Executive Life Insurance Plan - Monsanto Corp.

EXECUTIVE LIFE INSURANCE PLAN




TABLE OF CONTENTS

                                                                 
Introduction..........................................................1

Plan Overview

Benefits.....................................................2

Premiums.....................................................3

Coverage Amounts.............................................4

Cash Value...................................................4

Options at Retirement........................................4

"What happens if . . ."......................................5

Summary......................................................6

Eligibility..................................................6

Enrollment............................................................7

Tax Considerations....................................................7






    INDEX


    Active Employee Coverage.................2,4,6
    AD&D Insurance ............................1,2
    Assignment of Ownership......................7

    Beneficiary................................3,7
    Benefits at Death........................2,4,6
    BMF Compensation Strategies..................5
    Business Travel Accident
             Insurance.........................1,2

    Cash Value of Policy.......................4,7
    Collateral Assignment, Monsanto............2,7
    Connecticut General..........................5

    Disabled Employee (T&PD).....................5

    Eligibility..................................6
    Enrollment...................................7
    Estate Planning..............................7

    Evidence of Insurability.................2,4,6
    Illness, Life Threatening....................6
    Interest Credits...........................2,4

    Loans Against Cash Value...............2,4,6,7

    Premiums.....................................3

    Regular Monsanto Coverage....................1
    Retiree Coverage.......................2,4-5,6

    Salary Increases.............................4
    Statements, Annual...........................5
    Summary......................................6
    Surrender of Policy......................2,4,6

    Tax Considerations.........................3,7
    Terminating Employee.........................5

    Withdrawals from Cash Value............2,4,6,7







INTRODUCTION

   The following describes the Monsanto Executive (Split Dollar) Life
Insurance Program, which becomes effective January 1, 1988. There are
four sections:

* OVERVIEW - explains the benefits of the split dollar program, and how
  it works.
* ELIGIBILITY - lists evidence of insurability requirements.
* ENROLLMENT - explains the enrollment procedure.
* TAX CONSIDERATIONS - reviews current insurance industry understanding
  of tax implications.

BY WAY OF REVIEW . . .

   Before describing the new Split Dollar program, let's quickly review
the normal life insurance coverage provided to salaried employees and
retirees:

ACTIVE EMPLOYEES

* Group Term coverage providing a death benefit of two and one-half times
  annual base pay.
* Accidental Death and Dismemberment (AD&D) coverage of one times annual
  base pay.
* Business Travel Accident coverage of one and one-half times annual base pay.

RETIRED EMPLOYEES

* A death benefit equal to 62 1/2% of final base pay if you retire with 20 or
  more years of service, 37 1/2% with 10 to 20 years.

   Monsanto provides this protection at no cost to employees and retirees.
However, each year the individual pays income tax on the "value" of the
Group Term coverage in excess of $50,000, since this is an economic benefit
resulting in "imputed income" to the individual, according to tax
regulations. The "value" is determined from a government table and is based
on age and coverage amount.





PLAN OVERVIEW

   By enrolling in the Monsanto Executive Life Insurance plan, you will own
a universal life insurance policy issued by Connecticut General Life
Insurance Company. This policy will replace most of your existing Group Term
coverage and will provide you with

* HIGHER DEATH BENEFITS (both before and after you retire) and

* INCREASED FINANCIAL FLEXIBILITY by giving you access to the cash value of
  the policy in excess of Monsanto's contributions.

   The program is called "split dollar" because both you and Monsanto share
the cost and the ownership of the policy.

SPLIT DOLLAR PLAN BENEFITS

As an active employee, you will have

* A DEATH BENEFIT EQUAL TO FOUR TIMES YOUR ANNUAL BASE PAY PLUS ALL PREMIUMS
  --------------------------------------------------------------------------
  YOU HAVE PAID, and
  --------------

* regular AD&D and Business Travel Accident coverage, and

* the ability to make withdrawals or borrow against the cash value of the
  policy in excess of Monsanto's contribution. (This will reduce the death
  benefit by a like amount, in exchange for your use of the money before
  death.)

If you retire at or after age 62, you will have

* A DEATH BENEFIT EQUAL TO TWO TIMES YOUR FINAL BASE PAY PLUS ALL PREMIUMS
  ------------------------------------------------------------------------
  YOU HAVE PAID - which can be sustained long after premium payments have
  -------------
  ended (to approximately age 90), and

* the same ability to make withdrawals or borrow against the cash value of
  the policy, or

* you can cash in - "surrender" - the policy. In this case, Monsanto will be
  reimbursed for its premiums, but you keep the remainder of the cash value
  (less a small surrender charge). At that time, you'll have to pay taxes on
  the excess over your contributions.

   Interest credits will accumulate on a tax-deferred basis. Connecticut
General will provide illustrations of the cash value buildup to you at your
enrollment session.

   Making withdrawals, borrowing against the cash value of your policy, or
surrendering the policy can have tax implications. See the "Tax
Considerations" section, page 7.

   Monsanto's share of the policy ownership is a collateral assignment of
the case value and/or death benefits of the policy equal to the premiums it
has paid. Thus, the policy provides sufficient death benefits to reimburse
Monsanto for the premiums it has paid (but this does not affect any of your
benefits as described above).

   You can enroll for a lesser amount of coverage. However, if you later
decide you want to increase the coverage, the agreement of Monsanto and
Connecticut General will be required. Connecticut General will require
additional evidence of insurability.

   Note that for overview purposes, the death benefits described above are
referred to as being provided by the Split Dollar policy. In actuality, the
first $50,000 of the death benefit will continue to be provided under the
Group Term policy (because there's no imputed income tax to you on that
amount). You will not have to pay any premiums for this coverage. The normal
AD&D and Business Travel Accident coverage will also continue to be provided
under the existing policies. The remainder of your coverage will be provided
by the Split Dollar policy.





PLAN OVERVIEW
(continued)

PREMIUM PAYMENTS . . . YOURS AND MONSANTO'S

   During the premium payment period, both you and Monsanto pay premiums.

   You pay a portion of the premium equal to the "term" cost of the coverage
provided by the policy for your beneficiaries. As with term insurance
policies, this cost will increase with age. At the time of enrollment, you
will be provided with illustrative charts showing your projected premium
payments, based on your age. Here's a sampling of the cost per year per
$1,000 of death benefit:

                                      Your Annual Premium/
                Age                     $1,000 Insurance
                ---                     ----------------

                40                           $  .60
                45                              .80
                50                             1.13
                55                             1.58
                60                             2.87
                65                             4.60

   Monsanto pays the premiums in excess of the "term" cost.

   Premiums are payable until you reach age 65 (or until 10 years of program
participation if later). After deductions for administrative fees and for
risk charges, the remainder of the premiums is credited to the cash value of
the policy which accumulates interest on a tax-deferred basis. The premium
amount is set so that payments will end at age 65 (or after 10 payment years
if later), and there will be sufficient cash value to sustain the policy to
age 90 (assuming interest credits of 8 1/4% per year).

   As a normal death benefit, your beneficiaries will receive all the
premiums you have paid - in addition to the four times annual base pay as an
active employee or two times final base pay as a retiree.

COMPARING YOUR COSTS UNDER SPLIT DOLLAR AND REGULAR MONSANTO COVERAGE . . .

   Under the Split Dollar plan, you are paying premiums with after-tax
dollars for coverage over $50,000.

   Under the regular Monsanto coverage, you pay income tax on the "value" of
the Group Term coverage in excess of $50,000.

   Typically, the cost per year per $1,000 coverage will be less to you
under the Split Dollar plan than the imputed income tax under the regular
Monsanto program. (Of course, coverage under the Split Dollar plan is
higher, so your total cost will be determined by the cost per $1,000 times
your coverage.)

   Finally the Split Dollar plan is not term insurance. In addition to
providing a death benefit, your policy will also build cash value. This
gives you additional financial flexibility. The policy becomes self
sustaining at age 65 (or after 10 years of participation if later) and you
pay no more premiums.





PLAN OVERVIEW
(continued)

COVERAGE AMOUNTS TIED TO BASE PAY

   As an active employee, your death benefits are based on your annual base
pay, and increase automatically as your base pay increases.

   As a retiree, your benefits are based on final base pay at retirement.

DETERMINING YOUR POLICY'S CASH VALUE

   The cash value of your policy equals

         YOUR CONTRIBUTIONS,

    plus MONSANTO'S CONTRIBUTIONS,

   minus A 5% (OF PREMIUMS) FRONT-END ADMINISTRATIVE CHARGE

   minus A MORTALITY CHARGE (the cost charged by the insurance company to
         insure that portion of the death benefit in excess of the policy's
         cash value)

    plus INTEREST CREDITS on the balance.

   If you cash in ("surrender") the policy, you receive its current cash
value minus the company's contributions and minus a small surrender charge
(which ends in the tenth policy year).

MAKING ADDITIONAL CONTRIBUTIONS . . .

   Within legal limits, you can also invest additional money in the policy
and receive interest credits on a tax-deferred basis. This will build up
cash value, but this is not a primary purpose of the program. You will
probably find it financially attractive to make additional contributions
only if you expect to leave the money in for an extended period of time and
surrender the policy after termination or retirement.

OPTIONS AT RETIREMENT

   You have considerable financial flexibility after you retire.

   IF YOU RETIRE AT OR AFTER AGE 62 AND WISH TO MAINTAIN YOUR POLICY, you
and Monsanto continue to pay premiums until you reach 65 (or for the balance
of 10 payment years if later). Then, the policy becomes self-sustaining to
age 90 (assuming annual interest credits of at least 8 1/4%). In other
words, when premiums end, risk charges are paid out of the cash value of the
policy. You will then have to pay imputed income tax on the "term" cost of
the insurance, but you will be able to make withdrawals from the cash value
to pay these taxes.

   If interest is credited at a different rate, the policy's
self-sustainment will end at a different age. The rate currently being
credited by Connecticut General is 9%.

   IN ADDITION, YOU WILL HAVE THESE OTHER OPTIONS AFTER YOU RETIRE:

        *  CONTINUE THE POLICY, BUT WITH REDUCED COVERAGE. This will also
           reduce the risk charges paid out of the policy's cash value and
           also your imputed income tax.

        *  MAKE ADDITIONAL WITHDRAWALS OR BORROW AGAINST THE CASH VALUE OF
           THE POLICY, OR

        *  SURRENDER YOUR POLICY.





PLAN OVERVIEW
(continued)

   IF YOU RETIRE BEFORE AGE 62, MONSANTO WILL GENERALLY DISCONTINUE PAYMENT
OF PREMIUMS AND RECOVER ITS PREMIUMS AT THAT TIME. You will have the option
of continuing the policy on your own or surrendering the policy and taking
the cash value in excess of Monsanto's contributions. Also, if you have at
least 10 years of Benefit Service, sufficient funding will be provided to
fund coverage at least equal to regular Group Term coverage for salaried
employees. This assumes you make no withdrawals and continue to pay the
"term" cost of the reduced coverage until you reach age 65 (or 10 years of
participation if later).

WHAT HAPPENS IF . . .

WHAT HAPPENS IF YOU TERMINATE BEFORE AGE 62?

   If you terminate, the company will discontinue payment of premiums and
will recover its premiums at the time of your termination or retirement
(unless the company elects to exercise its discretion to continue the
payment of premiums and/or delay recovery of its premiums to a later time).

   You can maintain the policy by reimbursing Monsanto for the premiums it
has paid and continuing future premium payments personally. The cash to
repay Monsanto can be borrowed or withdrawn from the policy or paid from
personal funds. This repayment to Monsanto would terminate the split dollar
agreement and Monsanto would have no future ownership rights in the policy
cash values or death benefits. Alternatively, you can surrender the policy.
Monsanto would recoup its premiums at that time and the remaining cash value
would be yours to use as you choose.

WHAT HAPPENS IF YOU BECOME DISABLED?
   If you become totally and permanently disabled under the Disability
Income Plan, Monsanto will pay the entire premium. You will not be required
to contribute. You will have to pay taxes on the "term" costs, which will be
imputed to you as additional income.

OTHER CONSIDERATIONS
   In the event that the mortality or any other charges to the contract
reduce the policy's cash value so that the company's interest in the policy
may be impaired, the company will be allowed to recover its costs or to make
arrangements with the insured so that the company's interests remain intact.

ANNUAL STATEMENT
   You will receive an annual statement which will provide current, personalized
information about your policy. This will inform you of your current death
benefits, cash value, interest credits and mortality charges.

FOR MORE INFORMATION

The broker:   BMF Compensation Strategies
              613 Northwest Loop, Suite 500
              San Antonio, TX 78216
              (512) 366-0618

              Mr. Norm Bevan - President
              Ms. Colette Wagh - Vice President

Monsanto:     Robert N. Abercrombie - Director, Corporate Benefits - 4-2775

Insurance     Connecticut General        (for information about the status
  company:    Hartford, CT 06152         of your policy, amounts available
              (203) 726-7764             for loans or withdrawals, etc.)

              Mr. Louis Sumsky - Assistant Vice President






SPLIT DOLLAR
SUMMARY

   Here's a summary of the Monsanto Executive (Split Dollar) Life Insurance
plan:

AS AN ACTIVE EMPLOYEE . . .
NORMAL
DEATH BENEFIT
-------------
Four times annual
base pay, plus all
contributions.

FLEXIBILITY
-----------
You can make withdrawals
or borrow against the
Policy's cash value.

INCOME TAXES
ON IMPUTED INCOME
-----------------
You have no imputed income
because you are your
paying premiums equal to
the "term" cost of the
coverage.

AS A RETIREE (AT OR AFTER AGE 62) . . .
NORMAL
DEATH BENEFIT
-------------
Two times final base
pay, plus all your
contributions.

FLEXIBILITY
-----------
You can
* continue full coverage
* continue reduced
  coverage
* make withdrawals
  or borrow against the
  policy's cash value in
  excess of company
  contributions,
* surrender the policy,
  and receive cash value
  in excess of company
  contributions.

INCOME TAXES
ON IMPUTED INCOME
-----------------
While you pay premiums
you own no imputed income
tax. When your premiums
end, you pay imputed taxes
on the "term" cost of the
coverage.

ELIGIBILITY

   The Monsanto Executive (Split Dollar) Life Insurance plan is available to
designated members of the Monsanto Management Council as of January 1, 1988.
New members will become eligible when so designated by the Director of
Corporate Personnel.

   For eligible current members, coverage is guaranteed if you are actively
at work on October 1, 1987, and have not missed work more than three days
due to illness or injury during the preceding 90-day period. If you are age
61 or over on June 30, 1988, or if your initial coverage substantially
exceeds one million dollars, medical information will be required by
Connecticut General to establish the gross premium - in other words, the
total premium you and Monsanto pay. Your premiums will not be higher than
the normal "term" cost for a person your age.

   Medical information will also be required, and Connecticut General
reserves the right to establish a different gross premium, in the following
circumstances:

* you have been absent for more than three days due to illness or injury
  during the 90-day period ending October 1, 1987, or you are not actively at
  work on that day,

* you elect not to enroll for full coverage during this initial offering,
  but later request additional coverage,

* your cumulative salary increases exceed 8% compounded annually.

   In the above three circumstances, if the medical information indicates
that you have a life-threatening illness, the insurance company also
reserves the right to deny coverage.

   Similar underwriting requirements will apply to employees who become
eligible for the program after October 1, 1987.




ENROLLMENT

   To enroll, you will need to meet with a representative of the insurance
brokerage firm, BMF Compensation Strategies. You are invited to have your
personal advisor and your spouse at that meeting. You will receive
personalized information to illustrate premiums, death benefits and cash
values in the future.

   Any medical information requirements applicable in your situation will be
reviewed with you at that meeting.

   When you enroll, you will designate a beneficiary for your share of the
death benefit from your policy, or you can assign ownership of your policy
to another person or to a trust. Whatever your decision, you will also
execute a collateral assignment and split dollar agreement in favor of
Monsanto permitting it to recover the premiums it has paid from the cash
value or death benefit of the policy.

   Since the split dollar program significantly increases your life
insurance benefits, it will likely have an impact on your estate, financial
and tax planning. Before enrolling, you are encouraged to review this
program with your advisors in these areas to determine the most favorable
strategy for the ownership of the policy and the beneficiary(ies) to be
designated for the proceeds. The forms to be completed at enrollment will
require precise wording in these areas.

TAX
CONSIDERATIONS

   The tax information contained below and elsewhere in this program summary
is based on current insurance industry interpretations and practice for
similar policies. But there are no specific regulations or tax rulings on
this program, so you may want to review the subject with your tax advisor.

According to general insurance industry practice under current tax law:

* Death benefits are not subject to federal income tax unless the policy is
  transferred for valuable considerations.

* Like all life insurance, death benefits are subject to federal estate
  taxes unless excluded from your estate through a timely, irrevocable
  transfer of ownership. Irrevocable assignment may have give tax
  considerations.

* The buildup of cash value in the policy is not considered taxable as it
  accrues.

* Withdrawals of cash value may or may not be taxable, depending on the
  timing and amount of withdrawal.

* Loans against cash value are not considered taxable unless the policy is
  later surrendered or the loan is defaulted.

* Interest on loans is deductible according to the phase-out schedule for
  consumer loans.

* You have no imputed income from the policy as long as you are paying the
  "term" cost of coverage. When premium payments end, you have imputed
  income equal to the "term" cost of coverage.

   Because of the absence of definitive regulations and recent changes in
the tax code, be sure to consult your tax advisor about gift and estate tax
consequences, and before making a withdrawal or loan.

   The company reserves the right to amend or end this program, based on any
changes in the tax laws.