1998 Employee Stock Purchase Plan - ImClone Systems Inc.


                          IMCLONE SYSTEMS INCORPORATED
                        1998 EMPLOYEE STOCK PURCHASE PLAN

      The  following  constitutes  the  provisions  of the 1998  Employee  Stock
Purchase Plan of ImClone Systems Incorporated.

1.    PURPOSE.

      The  purpose of the Plan is to provide  employees  of the  Company and its
      Affiliates with an opportunity to purchase Common Stock of the Company. It
      is the intention of the Company that the Options granted under the Plan be
      considered  options issued under an 'Employee Stock Purchase Plan' as that
      term is defined under Section  423(b) of the Code.  The  provisions of the
      Plan  shall,  accordingly,   be  construed  so  as  to  extend  and  limit
      participation in a manner consistent with the requirements of that section
      of the Code.

2.    DEFINITIONS.

(a)   'AFFILIATE' as used in the Plan means any parent corporation or subsidiary
      corporation of the Company,  as those terms are defined in Sections 424(e)
      and (f), respectively, of the Code.

(b)   'BOARD'  shall mean the Board of Directors of the Company,  or a committee
      of the Board of Directors named by the Board to administer the Plan.

(c)   'CODE' shall mean the Internal Revenue Code of 1986, as amended.

(d)   'COMMON  STOCK'  shall mean the  Common  Stock,  $0.001 par value,  of the
      Company.

(e)   'COMPANY' shall mean ImClone Systems Incorporated, a Delaware corporation.

(f)   'COMPENSATION'  shall mean all  compensation  that is  taxable  income for
      federal  income tax  purposes,  including,  payments for  overtime,  shift
      premium, incentive compensation,  incentive payments, bonuses, commissions
      and other compensation.

(g)   'CONTINUOUS  STATUS  AS  AN  EMPLOYEE'  shall  mean  the  absence  of  any
      interruption  or  termination  of service as an employee of the Company or
      any  Affiliate.  Continuous  Status as an Employee shall not be considered
      interrupted  in the case of a leave of absence agreed to in writing by the
      Company or any Affiliate,  provided that such leave is for a period of not
      more than 90 days or  reemployment  upon the  expiration  of such leave is
      guaranteed by contract or statute.

(h)   'CONTRIBUTIONS'  shall  mean all  amounts  credited  to the  account  of a
      participant pursuant to the Plan.



(i)   'EXERCISE  DATE'  shall mean the last day of each  Offering  Period of the
      Plan.

(j)   'OFFERING  DATE' shall mean the first  business day of an Offering  Period
      under the Plan.

(k)   'OFFERING PERIOD' shall mean any of the three month periods  commencing on
      each of July 1,  October  1,  January  1 and April 1 of each year (or such
      other  periods as may be  determined  by the Board which shall comply with
      Section 423(b)(7) of the Code);  provided that the initial offering period
      shall commence at a time to be determined by the Board.

(l)   'OPTION' shall mean an option granted under Section 6 of this Plan.

(m)   'PLAN' shall mean this ImClone  Systems  Incorporated  1998 Employee Stock
      Purchase Plan.

3.    ELIGIBILITY.

(a)   Options may be granted only to employees of the Company or any  Affiliate.
      An  employee  of the  Company or any  Affiliate  shall not be  eligible to
      participate  in an Offering  Period,  unless on the Offering  Date of such
      Offering  Period,  such employee has  maintained  Continuous  Status as an
      Employee for a period of six (6) months  preceding  such Offering Date. In
      addition, no employee of the Company or any Affiliate shall be eligible to
      be granted an Option under the Plan,  unless,  on the Offering Date,  such
      employee's  customary  employment with the Company or such Affiliate is at
      least twenty (20) hours per week and at least five (5) months per calendar
      year.

(b)   No employee  shall be eligible  for the grant of an Option  under the Plan
      if,  immediately after any such grant, such employee owns stock possessing
      five percent (5%) or more of the total  combined  voting power or value of
      all classes of stock of the Company or of any  Affiliate.  For purposes of
      this  subparagraph  3(b),  the rules of  Section  424(d) of the Code shall
      apply in determining the stock ownership of any employee,  and stock which
      such employee may purchase under all outstanding  rights and options shall
      be treated as stock owned by such employee.

(c)   An eligible  employee may be granted an Option under the Plan only if such
      Option,  together with any other options  granted  under  'employee  stock
      purchase plans' of the Company and any Affiliates, as specified by Section
      423(b)(8) of the Code,  do not permit such  employee's  rights to purchase
      stock of the Company or any  Affiliate  to accrue at a rate which  exceeds
      twenty-five  thousand dollars ($25,000) of fair market value of such stock
      (determined  at the time such Options are granted) for each  calendar year
      in which such  Options are  outstanding  at any time.  Any Option  granted
      under the Plan shall be deemed to be modified to the extent  necessary  to
      satisfy this paragraph 3(c).

(d)   Officers of the Company  shall be  eligible  to  participate  in the Plan;
      provided,  however,  that the Board may provide in an Offering Period that


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      certain employees who are highly compensated  employees within the meaning
      of Section 423(b)(4)(D) of the Code shall not be eligible to participate.

4.    OFFERING PERIODS.

      The Plan shall be implemented by a series of Offering Periods,  with a new
      Offering Period  commencing on July 1, October 1, January l and April 1 of
      each year (or such other  periods as may be  determined by the Board which
      shall  comply  with  Section  423(b)(7)  of the Code);  provided  that the
      initial  Offering  Period shall commence at a time to be determined by the
      Board.  The Plan  shall  continue  until  terminated  in  accordance  with
      paragraph 17 or paragraph 21 hereof.  In addition,  employees shall not be
      entitled to enroll in the Plan or exercise any Options  granted  under the
      Plan during any period in which the Company has restricted the purchase or
      sale of its securities by its employees.

5.    PARTICIPATION; CONTRIBUTIONS.

(a)   An eligible employee may become a participant in the Plan by completing an
      enrollment form ('Enrollment  Form') provided by the Company and filing it
      with the Company prior to the  applicable  Offering  Date,  unless a later
      time for filing the  Enrollment  Form is set by the Board for all eligible
      employees with respect to a given  Offering  Period.  The Enrollment  Form
      shall set forth the percentage of the  participant's  Compensation  (which
      shall be a whole  percentage not less than 1% and not more than 15%) to be
      paid as Contributions pursuant to the Plan.

(b)   Payroll  deductions  shall  commence on the first  payroll  following  the
      Offering  Date and shall end on the last  payroll  paid on or prior to the
      Exercise  Date of the  Offering  Period  to which the  Enrollment  Form is
      applicable,  unless sooner  terminated by the  participant  as provided in
      paragraph  8.  All  payroll  deductions  made by a  participant  shall  be
      credited to such  participant  in an account under the Plan. A participant
      may not make payments into such account.

(c)   A participant  may  discontinue  his or her  participation  in the Plan as
      provided in paragraph 8.

(d)   Notwithstanding  the  foregoing,  to the extent  necessary  to comply with
      Section  423(b)(8) of the Code and paragraph 3(c) herein,  a participant's
      payroll deductions may be decreased to 0% at such time during any Offering
      Period which is scheduled to end during the current calendar year that the
      aggregate  of all  payroll  deductions  accumulated  with  respect to such
      Offering  Period  and any other  Offering  Period  ending  within the same
      calendar year equals $21,250.  Payroll  deductions shall recommence at the
      rate provided in such  participant's  Enrollment  Form at the beginning of
      the first  Offering  Period  which is  scheduled  to end in the  following
      calendar  year,  unless  terminated  by the  participant  as  provided  in
      paragraph 8.


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6.    GRANT OF OPTION.

(a)   On the Offering  Date of each  Offering  Period,  each  eligible  employee
      participating  in such  Offering  Period  shall be  granted  an  Option to
      purchase on the Exercise Date of such  Offering  Period a number of shares
      of Common  Stock  determined  by dividing  such  employee's  Contributions
      accumulated  prior to such Exercise Date and retained in the participant's
      account as of the Exercise Date by 85% of the fair market value of a share
      of the Common  Stock on the Exercise  Date;  provided  however,  that such
      purchase shall be subject to the limitations set forth in Sections 3(b), 3
      (c),  3(d) and 10 hereof.  The fair market  value of a share of the Common
      Stock shall be determined as provided in Section 6(b) below.

(b)   The  fair  market  value of the  Common  Stock  on a given  date  shall be
      determined by the Board in its discretion; provided that (i) if the Common
      Stock is listed on a stock exchange, the fair market value per share shall
      be the closing price on such exchange on such date as reported in the Wall
      Street Journal (or, (A) if not so reported,  as otherwise  reported by the
      exchange,  and (B) if not  reported  on such date,  then on the last prior
      date on which a sale of the  Common  Stock was  reported);  or (ii) if not
      listed on an exchange but traded on the National Association of Securities
      Dealers Automated  Quotation  ('Nasdaq')  National Market, the fair market
      value  per share  shall be the last  reported  sale  price on such date as
      reported  in the  Wall  Street  Journal  (or  (A) if not so  reported,  as
      otherwise  reported by the Nasdaq  National Market and (B) if not reported
      on such  date,  then on the last  prior date on which a sale of the Common
      Stock was  reported)  or (iii) if traded  on Nasdaq  SmallCap  and not the
      National  Market the fair market  value per share shall be the mean of the
      closing bid and asked price per share of the Common Stock on such date, as
      reported  in the Wall  Street  Journal  (or,  (A) if not so  reported,  as
      otherwise  reported  by Nasdaq,  and (B) if not so  reported on such date,
      then on the  last  prior  date on  which a sale of the  Common  Stock  was
      reported);  or (iv) if the Common Stock is otherwise  publicly traded, but
      not listed on a stock exchange or traded on Nasdaq,  the fair market value
      per  share  shall  be  determined  in  good  faith  by  the  Board  in its
      discretion.

7.    EXERCISE OF OPTION.

(a)   Unless a participant  withdraws  from the Plan as provided in paragraph 8,
      such participant's  Option for the purchase of shares of Common Stock will
      be exercised automatically on the Exercise Date of the Offering Period and
      the maximum  number of full shares of Common  Stock  subject to the Option
      will be purchased for such  participant at the  applicable  purchase price
      with the accumulated  Contributions in such  participant's  account.  If a
      fractional  number of shares of Common  Stock  results,  then such  number
      shall  be  rounded   down  to  the  next  whole   number  and  the  excess
      Contributions  shall be carried forward to the next Exercise Date,  unless
      such participant withdraws the Contributions pursuant to paragraph 8(a) or
      is no longer  eligible  to  participate  in the Plan,  in which  case such
      amount shall be  distributed  to the  participant  without  interest.  The
      shares  purchased upon exercise of an Option  hereunder shall be deemed to
      be  transferred  to  the  participant  on  the  Exercise  Date.  During  a
      participant's   lifetime,   a  participant's  Option  to  purchase  shares
      hereunder is exercisable only by such participant.


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(b)   Shares shall not be issued with  respect to an Option  unless the exercise
      of such  Option and the  issuance  and  delivery  of such shares of Common
      Stock pursuant thereto shall comply with all applicable provisions of law,
      domestic or foreign, including,  without limitation, the Securities Act of
      1933, as amended,  the  Securities  Exchange Act of 1934, as amended,  the
      rules and regulations promulgated thereunder,  and the requirements of any
      stock  exchange  upon which the shares of Common Stock may then be listed,
      and shall be further  subject to the  approval  of counsel for the Company
      with  respect to such  compliance.  As a condition  to the  exercise of an
      Option,  the  Company may  require  the person  exercising  such Option to
      represent  and warrant at the time of any such exercise that the shares of
      Common  Stock are being  purchased  only for  investment  and  without any
      present intention to sell or distribute such shares of Common Stock if, in
      the opinion of counsel for the Company,  such a representation is required
      by any of the aforementioned applicable provisions of law.

8.    WITHDRAWAL; TERMINATION OF EMPLOYMENT.

(a)   A  participant  may withdraw  all but not less than all the  Contributions
      credited  to his or her  account  under the Plan at any time  prior to the
      Exercise Date of the Offering Period by written notice to the Company. All
      of the participant's  Contributions credited to such participant's account
      will  be  paid  to  such  participant   promptly  after  receipt  of  such
      participant's  notice of withdrawal and such participant's  Option for the
      current Offering Period will be automatically  terminated,  and no further
      Contributions  for the  purchase  of shares of Common  Stock  will be made
      during the Offering Period.

(b)   Upon termination of the  participant's  Continuous  Status as an Employee,
      prior  to the  Exercise  Date  of the  Offering  Period  for  any  reason,
      including  retirement  or  death,  the  Contributions   credited  to  such
      participant's account will be returned to such participant or, in the case
      of his or her  death,  to the  person or persons  entitled  thereto  under
      paragraph 12, and his or her Option will be automatically terminated.

(c)   In the  event an  employee  fails to  remain  in  Continuous  Status as an
      Employee of the Company for at least 20 hours per week during the Offering
      Period in which the employee is a participant,  such  participant  will be
      deemed to have  elected to  withdraw  from the Plan and the  Contributions
      credited  to  such   participant's   account  will  be  returned  to  such
      participant and the Option terminated.

(d)   A  participant's  withdrawal  from an  Offering  Period  will not have any
      effect upon his or her eligibility to participate in a succeeding Offering
      Period or in any  similar  plan  which may  hereafter  be  adopted  by the
      Company.

9.    INTEREST.

      No interest  shall accrue on the  Contributions  of a  participant  in the
      Plan.


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 :  PAGE>

10.   STOCK.

      The maximum number of shares of Common Stock which shall be made available
      for sale under the Plan shall be 500,000 shares subject to adjustment upon
      changes in  capitalization  of the Company as provided  in  paragraph  16.
      Shares sold under the Plan may be newly issued shares or shares reacquired
      in private  transactions  or open  market  purchases,  but all shares sold
      under the Plan  regardless of source shall be counted  against the 500,000
      share  limitation.  If the total  number of shares of Common  Stock  which
      would  otherwise  be subject to Options  granted  pursuant to Section 6(a)
      hereof on the Offering  Date of an Offering  Period  exceeds the number of
      shares of Common Stock then available  under the Plan (after  deduction of
      all shares of Common Stock for which  Options  have been  exercised or are
      then  outstanding),  the Company  shall make a pro rata  allocation of the
      shares of Common Stock remaining  available for Option grant in as uniform
      a manner as shall be reasonably  practicable  and as it shall determine to
      be equitable.  Any amounts remaining in an employee's  account not applied
      to the  purchase  of Common  Stock  pursuant  to this  Section 10 shall be
      refunded on or  promptly  after the  Exercise  Date.  In such  event,  the
      Company  shall  give  written  notice of such  reduction  of the number of
      shares of Common  Stock  subject to the Option to each  employee  affected
      thereby  and  shall  similarly  reduce  the  rate  of  Contributions,   if
      necessary.

11.   ADMINISTRATION.

      The Board  shall  supervise  and  administer  the Plan and shall have full
      power  to  adopt,  amend  and  rescind  any  rules  deemed  desirable  and
      appropriate for the  administration  of the Plan and not inconsistent with
      the Plan,  to  construe  and  interpret  the  Plan,  and to make all other
      determinations necessary or advisable for the administration of the Plan.

12.   DESIGNATION OF BENEFICIARY.

(a)   A participant  may file a written  designation of a beneficiary  who is to
      receive  any  shares  of  Common  Stock  and  cash,   if  any,   from  the
      participant's  account  under the Plan in the event of such  participant's
      death  subsequent to the end of the Offering  Period but prior to delivery
      of such  participant's  shares of Common Stock and cash.  In  addition,  a
      participant  may file a written  designation  of a  beneficiary  who is to
      receive  any cash  from the  participant's  account  under the Plan in the
      event  of such  participant's  death  prior  to the  Exercise  Date of the
      Offering   Period.   If  a  participant  is  married  and  the  designated
      beneficiary is not the spouse,  spousal consent shall be required for such
      designation to be effective.

(b)   Such designation of beneficiary may be changed by the participant (and his
      or her spouse,  if any) at any time by written notice. In the event of the
      death  of a  participant  and  in the  absence  of a  beneficiary  validly
      designated under the Plan who is living at the time of such  participant's
      death,  the Company  shall deliver such shares of Common Stock and/or cash
      to the executor or administrator  of the estate of the participant,  or if
      no such executor or administrator  has been appointed (to the knowledge of
      the  Company),  the Company,  in its  discretion,  may deliver such shares
      and/or cash to the spouse or to any one or more dependents or relatives of


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      the  participant,  or if no spouse,  dependent or relative is known to the
      Company, then to such other person as the Company may designate.

13.   TRANSFERABILITY.

      Neither  Contributions  credited to a participant's account nor any rights
      with regard to the  exercise of an Option or to receive  shares  under the
      Plan may be assigned, transferred, pledged or otherwise disposed of in any
      way  other  than by  will,  the laws of  descent  and  distribution  or as
      provided in  paragraph 12 hereof by the  participant.  Any such attempt at
      assignment, transfer, pledge or other disposition shall be without effect,
      except  that the  Company  may treat such act as an  election  to withdraw
      Contributions in accordance with paragraph 8.

14.   USE OF FUNDS.

      All  Contributions  received or held by the Company  under the Plan may be
      used by the Company for any corporate  purpose,  and the Company shall not
      be obligated to segregate such Contributions.

15.   REPORTS.

      Individual  accounts will be maintained for each  participant in the Plan.
      Statements  of  account  will be  given  to  participants,  the per  share
      purchase  price,  the number of shares  purchased and the  remaining  cash
      balance, if any.

16.   ADJUSTMENTS UPON CHANGES IN STOCK.

      If any change is made in the shares of Common Stock subject to the Plan or
      subject  to  any  Option   granted   under  the  Plan   (through   merger,
      consolidation,  reorganization,  distribution of substantially  all of the
      assets of the Company, spin-off of a subsidiary's voting securities to the
      Company's  shareholders,   recapitalization,   stock  dividend,  split-up,
      combination  of  shares,   exchange  of  shares,  issuance  of  rights  to
      subscribe, or change in capital structure),  appropriate adjustments shall
      be made by the Board as to the  maximum  number of shares  subject  to the
      Plan and the number of shares and price per share  subject to  outstanding
      Options as shall be equitable to prevent dilution or enlargement of Option
      rights.  Any  determination  made by the Board  hereunder  shall be final,
      binding and conclusive upon each participant.

17.   AMENDMENT OR TERMINATION.

      The Board may at any time terminate or amend the Plan.  Except as provided
      in  paragraph  16,  no such  termination  may  affect  Options  previously
      granted,  nor may an  amendment  make any change in any  Option  therefore
      granted  which  adversely  affects  the  rights  of  any  participant.  In
      addition,  to the extent  necessary to comply with Section 423 of the Code
      (or any successor rule or provision or any applicable law or  regulation),


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      the Company shall obtain stockholder approval in such a manner and to such
      a degree as so required.

18.   NOTICES.

      All notices or other  communications by a participant to the Company under
      or in  connection  with the Plan  shall be deemed to have been duly  given
      when received in the form specified by the Company at the location,  or by
      the person, designated by the Company for the receipt thereof.

19.   RIGHT TO TERMINATE EMPLOYMENT.

      Nothing in the Plan or in any agreement  entered into pursuant to the Plan
      shall confer upon any  participant the right to continue in the employment
      of the Company or any Affiliate,  or affect any right which the Company or
      any Affiliate may have to terminate the employment of such participant.

20.   RIGHTS AS A STOCKHOLDER.

      Neither  the  granting  of an Option nor a deduction  from  payroll  shall
      constitute  a  participant  the owner of shares  covered by an Option.  No
      participant  shall  have any right as a  stockholder  unless  and until an
      Option has been exercised,  and the shares of Common Stock  underlying the
      Option have been registered in the Company's share register.

21.   TERM OF PLAN.

      The Plan shall become effective upon its adoption by each of the Board and
      the stockholders and shall continue in effect for a term of ten (10) years
      unless sooner terminated earlier under paragraph 17.

22.   APPLICABLE LAW.

      This Plan shall be governed in accordance with the laws of Delaware.


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