8-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) September 26, 2006

Merck & Co., Inc.

(Exact name of registrant as specified in its charter)

New Jersey	1-3305	22-1109110
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

One Merck Drive, PO Box 100, Whitehouse Station, NJ	08889-0100
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (908) 423-1000

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

EX-10.1: MERCK & CO., INC. PLAN FOR DEFERRED PAYMENT OF DIRECTORS' COMPENSATION

EX-10.2: MERCK & CO., INC. DEFERRAL PROGRAM

Item 1.01. Entry into a Material Definitive Agreement.

     (a) Director Compensation.

On September 26, 2006, the Board of Directors of Merck & Co., Inc. (“Merck” or the “Company”) completed a review of compensation for non-employee directors. The review included an analysis of the most recent proxy statements of U.S.-based pharmaceutical peers and the Dow Jones Industrial companies. Based on the analysis, and the increased responsibility and time commitment associated with Board and committee service (particularly for Audit Committee members), the Board revised the compensation of non-employee directors as follows, effective October 1, 2006:

Compensation Item	Year Last Revised		Prior Amount		Revised Amount
Annual Retainers
Board		1999		$45,000		$55,000
Audit Committee Chair		2004		$15,000		$20,000
Audit Committee Members		2004		$5,000		$10,000
Meeting Fees (Board and Committee)		1991		$1,200		$1,500
Annual credit to Merck Common Stock Account in the Plan for Deferred Payment of Directors’ Compensation (the “Directors’ Plan”)		1999	Value equal to 1/3 Annual Retainer for Board service (i.e., $15,000 per year)		Value equal to Annual Retainer for Board service (i.e., $55,000 per year), beginning April, 2007

All other elements of compensation for non-employee directors remain the same.

The Directors’ Plan was amended and restated by the Committee on Corporate Governance to reflect the increase in annual credit to the Merck Common Stock Account described above. This increase will be reflected when made in April, 2007. A copy of the amended and restated Directors’ Plan is filed as Exhibit 10.1 to this report.

     (b) Amendments to Deferral Program.

On September 29, 2006, the Merck Compensation and Benefits Committee (the “C&B Committee”) amended and restated the Merck & Co., Inc. Deferral Program (the “Program”) to implement the second of a two-step process, providing Program participants maximum flexibility during the transition period prior to the Program being amended to fully conform with requirements of the American Jobs Creation Act of 2004. Under Step 1, previously announced in Forms 8-K filed October 28, 2005 and December 22, 2005, participants were permitted to cancel prior deferral elections in late 2005. Under Step 2, to be completed during October 2006, participants will be permitted to elect new distribution schedules for their accounts. More specifically, the Program was amended to:

• Provide that distributions begin in the year after retirement or separation (formerly, distributions could begin in the year of retirement or separation)

• Eliminate the requirement that distributions be completed within 15 years of retirement or separation

• Provide distributions be made as soon as administratively feasible following a participant’s death

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• Provide all elections, including changes to distribution schedules, be made by the process determined by the Senior Vice President, Human Resources, so long as they do not violate Section 409A of the Internal Revenue Code (the “Code”)

• Reflect the change in control provisions adopted by the Board as previously announced in a Form 8-K filed on November 29, 2004

• Require compliance with Section 409A of the Code

• Provide that the investment alternatives are the same as under the Company’s 401(k) plan for salaried employees as in effect from time to time and

• Make certain other clarifying and non-substantive changes.

The foregoing summary is qualified in its entirety by reference to the text of the Program, a copy of which is filed as Exhibit 10.2 to this report.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit 10.1	Merck & Co., Inc. Plan for Deferred Payment of Directors’ Compensation as amended and restated effective October 1, 2006
Exhibit 10.2	Merck & Co., Inc. Deferral Program as amended and restated as of September 28, 2006.

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Merck & Co., Inc.
Date: October 2, 2006	By:	/s/ Debra A. Bollwage
		DEBRA A. BOLLWAGE Senior Assistant Secretary

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EX-10.1

Exhibit 10.1

MERCK & CO., INC.

PLAN FOR DEFERRED PAYMENT OF

DIRECTORS’ COMPENSATION

(Amended and Restated as of October 1, 2006)

TABLE OF CONTENTS

		Page
Article I	Purpose		1
Article II	Election of Deferral, Measurement Methods and Distribution Schedule		1
Article III	Valuation of Deferred Amounts		2
Article IV	Redesignation Within a Deferral Account		4
Article V	Payment of Deferred Amounts		5
Article VI	Designation of Beneficiary		6
Article VII	Plan Amendment or Termination		6
Schedule A	Measurement Methods		7

(i)

MERCK & CO., INC.
PLAN FOR DEFERRED PAYMENT OF
DIRECTORS’ COMPENSATION

I.	PURPOSE
	To provide an arrangement under which directors of Merck & Co., Inc. other than current employees may (i) elect to voluntarily defer payment of annual retainers and Board and committee meeting fees until after termination of their service as a director, and (ii) value compensation mandatorily deferred on their behalf.
II.	ELECTION OF DEFERRAL, MEASUREMENT METHODS AND DISTRIBUTION SCHEDULE

A.	Election of Voluntary Deferral Amount
1.	Prior to December 28 of each year, each director is entitled to make an irrevocable election to defer until termination of service as a director receipt of payment of (a) 50% or 100% of the Board retainer for the 12 months beginning April 1 of the next calendar year, (b) 50% or 100% of the Committee Chairperson retainer for the 12 months beginning April 1 of the next calendar year, (c) 50% or 100% of the Audit Committee member retainer for the 12 months beginning April 1 of the next calendar year and (d) 50% or 100% of the Board and committee meeting fees for the 12 months beginning April 1 of the next calendar year.
2.	Prior to commencement of duties as a director, a director newly elected or appointed to the Board during a calendar year must make the election under this paragraph for the portion of the Voluntary Deferral Amount applicable to such director’s first year of service (or part thereof).
3.	The Voluntary Deferral Amount shall be credited as follows: (1) Board and committee meeting fees that are deferred are credited on the last business day of each calendar quarter; (2) if the Board retainer, Committee Chairperson retainer and/or Audit Committee member retainer are deferred, a pro-rata share of the deferred retainer is credited on the last business day of each calendar quarter. The dates the Voluntary Deferral Amount, or parts thereof, are credited to the director’s deferred account are hereinafter referred to as the Voluntary Deferral Dates.
B.	Mandatory Deferral Amount
1.	On the Friday following the Company’s Annual Meeting of Stockholders (such Friday hereinafter referred to as the “Mandatory Deferral Date”), each director will be credited with an amount equivalent to the annual cash retainer for the 12 month period beginning on the April 1 preceding the Annual Meeting (the “Mandatory Deferral Amount”). The Mandatory Deferral Amount will be measured by the Merck Common Stock account.
2.	A director newly elected or appointed to the Board after the Mandatory Deferral Date will be credited with a pro rata portion of the Mandatory Deferral Amount

	applicable to such director’s first year of service (or part thereof). Such pro rata portion shall be credited to the director’s account on the first day of such director’s service.
C.	Automatic Deferral of Executive Committee Fees
1.	Effective June 1, 2005, any director who serves as either Chairperson or member of the Board’s Executive Committee, in lieu of any cash payment for such service, will be credited with an amount, if any, provided by way of retainer or meeting fees (the “Automatic Deferral Amount”). The Automatic Deferral Amount will be measured by the Merck Common Stock account.
2.	The “Automatic Deferral Date” with respect to meeting fees will be the last business day of each calendar quarter during which such meetings occurred. The “Automatic Deferral Date” for Committee Chairperson retainer and/or Committee member retainer fees, which are annual fees paid quarterly, will be the last business day of each calendar quarter.
D.	Election of Measurement Method
	Each such annual election referred to in Section A shall include an election as to the measurement method or methods by which the value of amounts deferred will be measured in accordance with Article III, below. The available measurement methods are set forth on Schedule A hereto.
E.	Election of Distribution Schedule
	Each annual election referred to in Article II, Sections A, B and C shall also include an election to receive payment following termination of service as a director of all Voluntary Deferral Amounts Mandatory Deferral Amounts and Automatic Deferral Amounts in a lump sum either immediately or one year after such termination, or in quarterly or annual installments over five, ten or fifteen years. Any election made with respect to a Mandatory Deferral Amount also shall apply with respect to any Automatic Deferral Amount credited during the same period.

III. VALUATION OF DEFERRED AMOUNTS

A.	Common Stock
1.	Initial Crediting. The annual Mandatory Deferral Amount shall be used to determine the number of full and partial shares of Merck Common Stock which such amount would purchase at the closing price of the Common Stock on the New York Stock Exchange on the Mandatory Deferral Date.
	The Automatic Deferral Amount shall be used to determine the number of full and partial shares of Merck Common Stock which such amount would purchase at the closing price of the Common Stock on the New York Stock Exchange on the Automatic Deferral Date.

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	That portion of the Voluntary Deferral Amount allocated to Merck Common Stock shall be used to determine the number of full and partial shares of Merck Common Stock which such amount would purchase at the closing price of the Common Stock on the New York Stock Exchange on the applicable Voluntary Deferral Date.
	However, should it be determined by the Committee on Corporate Governance of the Board of Directors that a measurement of Merck Common Stock on any Mandatory, Automatic or Voluntary Deferral Date would not constitute fair market value, then the Committee shall decide on which date fair market value shall be determined using the valuation method set forth in this Article III, Section A.1.
	At no time during the deferral period will any shares of Merck Common Stock be purchased or earmarked for such deferred amounts nor will any rights of a shareholder exist with respect to such amounts.
2.	Dividends. Each director’s account will be credited with the additional number of full and partial shares of Merck Common Stock which would have been purchasable with the dividends on shares previously credited to the account at the closing price of the Common Stock on the New York Stock Exchange on the date each dividend was paid.
3.	Distributions. Distribution from the Merck Common Stock account will be valued at the closing price of Merck Common Stock on the New York Stock Exchange on the distribution date.
B.	Mutual Funds
1.	Initial Crediting. The amount allocated to each Mutual Fund shall be used to determine the full and partial Mutual Fund shares which such amount would purchase at the closing net asset value of the Mutual Fund shares on the Mandatory or Voluntary Deferral Date, whichever is applicable. The director’s account will be credited with the number of full and partial Mutual Fund shares so determined.
	At no time during the deferral period will any Mutual Fund shares be purchased or earmarked for such deferred amounts nor will any rights of a shareholder exist with respect to such amounts.
2.	Dividends. Each director’s account will be credited with the additional number of full and partial Mutual Fund shares which would have been purchasable, at the closing net asset value of the Mutual Fund shares as of the date each dividend is paid on the Mutual Fund shares, with the dividends which would have been paid on the number of shares previously credited to such account (including pro rata dividends on any partial shares).
3.	Distributions. Mutual Fund distributions will be valued based on the closing net asset value of the Mutual Fund shares on the distribution date.

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C.

Adjustments

In the event of a reorganization, recapitalization, stock split, stock dividend, combination of shares, merger, consolidation, rights offering or any other change in the corporate structure or shares of the Company or a Mutual Fund, the number and kind of shares or units of such investment measurement method available under this Plan and credited to each director’s account shall be adjusted accordingly.

IV. REDESIGNATION WITHIN A DEFERRAL ACCOUNT

A.	General
	A director may request a change in the measurement methods used to value all or a portion of his/her account other than Merck Common Stock. Amounts deferred using the Merck Common Stock method and any earnings attributable to such deferrals may not be redesignated. The change will be effective on (i) the day when the redesignation request is received pursuant to administrative guidelines established by the Human Resources Financial Services area of the Treasury department, provided the request is received prior to the close of the New York Stock Exchange on such day or (ii) the next following business day if the request is received when the New York Stock Exchange is closed.
B.	When Redesignation May Occur
1.	During Active Service. There is no limit on the number of times a director may redesignate the portion of his/her deferred account permitted to be redesignated. Each such request shall be irrevocable and can be designated in whole percentages or as a dollar amount.
2.	After Death. Following the death of a director, the legal representative or beneficiary of such director may redesignate subject to the same rules as for active directors set forth in Article IV, Section B.1.
C.	Valuation of Amounts to be Redesignated
	The portion of the director’s account to be redesignated will be valued at its cash equivalent and such cash equivalent will be converted into shares or units of the other measurement method(s). For purposes of such redesignations, the cash equivalent of the value of the Mutual Fund shares shall be the closing net asset value of such Mutual Fund on (i) the day when the redesignation request is received pursuant to administrative guidelines established by the Human Resources Financial Services area of the Treasury department, provided the request is received prior to the close of the New York Stock Exchange on such day or (ii) the next following business day if the request is received when the New York Stock Exchange is closed.

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V. PAYMENT OF DEFERRED AMOUNTS

A.	Payment
	All payments to directors of amounts deferred will be in cash in accordance with the distribution schedule elected by the director pursuant to Article II, Section E. Distributions shall be pro rata by measurement method. Distributions shall be valued on the fifteenth day of the distribution month (or, if such day is not a business day, the next business day) and paid as soon thereafter as possible.
B.	Changes to Distribution Schedule Prior to Termination
	Upon the request of a director made at any time during the calendar year immediately preceding the calendar year in which service as a director is expected to terminate, the Committee on Corporate Governance of the Board of Directors (the “Committee”), in its sole discretion, may authorize: (a) an extension of a payment period beyond that originally elected by the director not to exceed that otherwise allowable under Article II, Section E, and/or (b) a payment frequency different from that originally elected by the director. Such request may not be made with regard to amounts deferred after December 31, 1990 using the Merck Common Stock method and to any earnings attributable to such deferrals. Deferrals into Merck Common Stock made after December 31, 1990 and any earnings thereon may only be distributed in accordance with the schedule elected by the director under Article II, Section E or determined by the Committee on Corporate Governance under Article VI.
C.	Post-Termination Changes to Distribution Schedule
	Following termination of service as a director, each director may make one request for a further extension of the period for distribution of his/her deferred compensation. Such request must be received by the Committee on Corporate Governance prior to the first distribution to the participant under his/her previously elected distribution schedule. Any revised distribution schedule may not exceed the deferral period otherwise allowable under Article II, Section E. This request may be granted and a new payment schedule determined in the sole discretion of the Committee on Corporate Governance.
	Such request may not be made with regard to amounts deferred after December 31, 1990 using the Merck Common Stock Method and to any earnings attributable to such deferrals. Any retired director who is not subject to U.S. income tax may petition the Committee on Corporate Governance to change payment frequency, including a lump sum distribution, and the Committee on Corporate Governance may grant such petition if, in its discretion, it considers there to be reasonable justification therefor. Deferrals into Merck Common Stock made after December 30, 1990 and any earnings thereon may only be distributed in accordance with the schedule elected by the director under Article II, Section E or determined by the Committee on Corporate Governance under Article VI.

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D.	Forfeitures
	A director’s deferred amount attributable to the Mandatory Deferral Amount and earnings thereon shall be forfeited upon his or her removal as a director or upon a determination by the Committee on Corporate Governance in its sole discretion, that a director has:

(i)	joined the Board of, managed, operated, participated in a material way in, entered employment with, performed consulting (or any other) services for, or otherwise been connected in any material manner with a company, corporation, enterprise, firm, limited partnership, partnership, person, sole proprietorship or any other business entity determined by the Committee on Corporate Governance in its sole discretion to be competitive with the business of the Company, its subsidiaries or its affiliates (a “Competitor”);
(ii)	directly or indirectly acquired an equity interest of 5 percent or greater in a Competitor; or
(iii)	disclosed any material trade secrets or other material confidential information, including customer lists, relating to the Company or to the business of the Company to others, including a Competitor.

VI.	DESIGNATION OF BENEFICIARY
	In the event of the death of a director, the deferred amount at the date of death shall be paid to the last named beneficiary or beneficiaries designated by the director, or, if no beneficiary has been designated, to the director’s legal representative, in one or more installments as the Committee on Corporate Governance in its sole discretion may determine.
VII.	PLAN AMENDMENT OR TERMINATION
	The Committee on Corporate Governance shall have the right to amend or terminate this Plan at any time for any reason.

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SCHEDULE A

MEASUREMENT METHODS

(January 1, 2002 — January 10, 2003)

Merck Common Stock

Mutual Funds

American Century Emerging Markets Fund
American Century Europacific Growth Fund
Fidelity Destiny I
Fidelity Dividend Growth
Fidelity Equity Income Fund
Fidelity Low-Priced Stock Fund
Fidelity Retirement Money Market
Fidelity Spartan Government Income
Fidelity Spartan U.S. Equity Index
Franklin Small-Mid Cap Growth A
Janus Enterprise
Janus Growth & Income
Liberty Acorn Z
PIMCO Foreign Bond Institutional
PIMCO Long Term US Government Institutional
PIMCO Total Return Institutional
Putnam Global Equity Fund A*
Putnam International Voyager A
Putnam Vista A
T. Rowe Price Blue Chip Growth Fund
Vanguard Asset Allocation

*  From September 20, 2002 — September 30, 2002, this investment was briefly named the Putnam Global Growth Fund A as a result of the merger, in September 2002, of Putnam Global Equity Fund A with Putnam Global Growth Fund A. The merged fund briefly retained the name “Putnam Global Growth Fund A.” Effective October 1, 2002, the merged fund changed its name to “Putnam Global Equity Fund A.”

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SCHEDULE A

MEASUREMENT METHODS

(Effective January 11, 2003 to July 31, 2003)

Merck Common Stock

Mutual Funds

American Century Emerging Markets Institutional
American Funds EuroPacific Growth Fund
Fidelity Destiny I
Fidelity Dividend Growth
Fidelity Equity-Income
Fidelity Low-Priced Stock
Fidelity Retirement Money Market
Fidelity Spartan Government Income
Fidelity Spartan U.S. Equity Index
Franklin Small-Mid Cap Growth A
Janus Enterprise
Janus Growth & Income
Liberty Acorn Class Z
PIMCO Foreign Bond Institutional
PIMCO Long Term US Government Institutional
PIMCO Total Return Institutional
Putnam Global Equity A
Putnam International Capital Opportunities Fund A*
Putnam Vista A
T. Rowe Price Blue Chip Growth
Vanguard Asset Allocation

* Prior to April 30, 2003, known as Putnam International Voyager Fund A.

Redesignation of Deferred Amounts measured by Putnam Vista A on July 31, 2003

Prior to 4 p.m. ET on July 31, 2003, each participant who has any part of his/her account measured by the Putnam Vista A measurement method may redesignate the amount in such measurement method in accordance with Article IV. If a participant does not redesignate the amount measured by the Putnam Vista A measurement method to any other remaining measurement method before 4 p.m. ET on July 31, 2003, then the amount in the Putnam Vista A account shall be redesignated as of 4 p.m. ET on July 31, 2003, to the Fidelity Mid-Cap Stock Fund.

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SCHEDULE A

MEASUREMENT METHODS

(Effective July 31, 2003 — November 19, 2003)

Merck Common Stock

Mutual Funds

American Century Emerging Markets Institutional
American Funds EuroPacific Growth Fund
Columbia Acorn Class Z*
Fidelity Destiny I
Fidelity Dividend Growth
Fidelity Equity-Income
Fidelity Low-Priced Stock
Fidelity Mid-Cap Stock Fund
Fidelity Retirement Money Market
Fidelity Spartan Government Income
Fidelity Spartan U.S. Equity Index
Franklin Small-Mid Cap Growth A
Janus Enterprise
Janus Growth & Income
PIMCO Foreign Bond Institutional
PIMCO Long Term US Government Institutional
PIMCO Total Return Institutional
Putnam Global Equity A
Putnam International Capital Opportunities Fund A**
T. Rowe Price Blue Chip Growth
Vanguard Asset Allocation

*	Prior to October 2003, known as Liberty Acorn Class Z
**	Prior to April 30, 2003, known as Putnam International Voyager Fund A

Redesignation of Deferred Amounts measured by Putnam Global Equity A and Putnam International Capital Opportunities Fund A (collectively, the “Putnam Funds”) on November 19, 2003

Prior to 4 p.m. ET on November 19, 2003, each participant who has any part of his/her Deferred Compensation Account measured by a Putnam Funds investment alternative may redesignate the amount in such investment alternative in accordance with Article IV. If a participant does not redesignate the amount measured by a Putnam Funds investment alternative to any other remaining investment alternative(s) before 4 p.m. ET on November 19, 2003, then the amount in the Putnam Funds investment alternative shall be redesignated as of 4 p.m. ET on November 19, 2003, to the Fidelity Retirement Money Market Portfolio.

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SCHEDULE A

MEASUREMENT METHODS
(November 19, 2003 to April 2, 2004)

Merck Common Stock

Mutual Funds

American Century Emerging Markets Institutional
American Funds EuroPacific Growth Fund
Columbia Acorn Class Z*
Fidelity Destiny I
Fidelity Dividend Growth
Fidelity Equity-Income
Fidelity Low-Priced Stock
Fidelity Mid-Cap Stock Fund
Fidelity Retirement Money Market
Fidelity Spartan Government Income
Fidelity Spartan U.S. Equity Index
Franklin Small-Mid Cap Growth A
Janus Enterprise
Janus Growth & Income
PIMCO Foreign Bond Institutional
PIMCO Long Term US Government Institutional
PIMCO Total Return Institutional
T. Rowe Price Blue Chip Growth
Vanguard Asset Allocation

* Prior to October 2003, known as Liberty Acorn Class Z.

4-02-04

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SCHEDULE A

MEASUREMENT METHODS
(April 2, 2004 through January 31, 2005)

Merck Common Stock

Mutual Funds

American Century Emerging Markets Institutional
American Funds EuroPacific Growth Fund
Columbia Acorn Class Z*
Fidelity Destiny I
Fidelity Dividend Growth
Fidelity Equity-Income
Fidelity Low-Priced Stock
Fidelity Mid-Cap Stock Fund
Fidelity Retirement Money Market
Fidelity Spartan Government Income
Fidelity Spartan U.S. Equity Index
Janus Enterprise
Janus Growth & Income
PIMCO Foreign Bond Institutional
PIMCO Long Term US Government Institutional
PIMCO Total Return Institutional
T. Rowe Price Blue Chip Growth
Vanguard Asset Allocation

* Prior to October 2003, known as Liberty Acorn Class Z.

   4-02-04

11

SCHEDULE A

MEASUREMENT METHODS
(February 1, 2005)

Investment alternatives available under this plan shall be the same as the investment alternatives available from time to time under the Merck & Co., Inc. Deferral Program.

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EX-10.2

Exhibit 10.2

MERCK & CO., INC.

DEFERRAL PROGRAM

(Amended and Restated as of September 28, 2006)

TABLE OF CONTENTS

		Page
Article I	Administration		1
Article II	Eligibility		1
Article III	Deferral Into a Deferred Compensation Account		1
Article IV	Valuation of Deferred Compensation Accounts		2
Article V	Redesignation Within a Deferred Compensation Account		4
Article VI	Distribution of Deferred Compensation Accounts		6
Article VII	Deductions from Distributions		7
Article VIII	Beneficiary Designations		7
Article IX	Amendments		8
Article X	Section 409A		8
Schedule I	Deferral Program Investment Alternatives		9
Schedule II	Special Provisions Applicable to Medco Health Employees		10
Schedule III	Special Transition Provisions Under AJCA		11

(i)

MERCK & CO., INC. DEFERRAL PROGRAM

     The Deferral Program (the “Program”) is intended to permit a select group of management to defer income which would otherwise be immediately payable to them as annual base salary or under various incentive plans of Merck & Co., Inc. (the “Company”).

I. ADMINISTRATION

     This Program is administered by the Compensation and Benefits Committee of the Company’s Board of Directors. This Committee is composed of non-employee directors only. The Committee shall have responsibility for determining which investments will be available under the Program, and those investments shall be listed on Schedule I hereto. The Committee shall review the investment selections at least once every five years. The Committee shall make all decisions affecting the timing, price or amount of any and all of the Deferred Compensation of participants subject to Section 16 of the Securities Exchange Act of 1934, as amended (“Section 16 Officers”), but may otherwise delegate any of its authority under this Program.

II. ELIGIBILITY

     Eligibility to defer under this Program will be determined in accordance with the terms of the Company’s Base Salary Deferral Plan and various incentive plans. However, the Committee has the authority to refuse to permit an employee to participate in this Program, if the Committee determines that such participation would jeopardize the Program’s compliance with applicable law or the Program’s status as a top hat plan under the Employee Retirement Income Security Act.

III. DEFERRAL INTO A DEFERRED COMPENSATION ACCOUNT

A. Election to Defer

     A participant’s decision to defer under the Program must be made, (i) for the Base Salary Deferral Plan, prior to the commencement of the pay period during which the base salary to be deferred will be earned, (ii) for annual incentive plans, prior to the commencement of the performance year during which the bonus monies to be deferred will be earned, and (iii) for long-term incentive plans, prior to the commencement of the last year of the award period during which the bonus monies to be deferred will be earned. For purposes of annual incentive plans only, a participant who is hired by the Company during a performance year may make an election, no later than the 30th day from the participant’s date of hire, to defer bonus monies to be earned during such performance year. For the Base Salary Deferral Plan, only amounts equal to or in excess of 5 percent of Annual Base Salary (as defined in the Base Salary Deferral Plan) and less than or equal to the lesser of (1) 50 percent of Annual Base Salary or (2) the Participant’s Annual Base Salary in excess of the amount determined under Section 401(a)(17) of the Internal Revenue Code (the “Code”) may be deferred. For the annual and long-term incentive plans, only amounts in excess of $3,000 may be deferred. Amounts so deferred are known as “Deferred Compensation” and will be credited to the participant’s “Deferred Compensation Account.” Deferred Compensation shall be held in one account regardless of the plan (Base Salary Deferral or incentive plan) under which it was deferred.

B. Election of Distribution Schedule

1. Timing of Election

     The participant shall elect a distribution schedule for his/her Deferred Compensation. A participant’s election of a distribution schedule in connection with a deferral election under annual and/or long-term incentive plans shall be made at the same time that the participant makes the election to defer. A participant’s initial election of a distribution schedule in connection with deferrals under the Base Salary Deferral Plan shall be made at the same time as the initial deferral election, shall be irrevocable during the calendar year for which it was made and shall apply to all deferrals of Annual Base Salary until a new distribution election becomes effective. Thereafter, an election of a different distribution schedule in connection with deferrals under the Base Salary Deferral Plan may be made at any time, provided, however, that such new distribution schedule shall only apply prospectively to deferrals of Annual Base Salary in the following calendar year.

2. Distribution Schedule

     A participant may elect to have payments begin (a) in a particular year (whether or not employment has then ended) or (b) in the year following the participant’s Retirement or Separation date, or (c) up to 15 years subsequent to the participant’s Retirement or Separation date. A participant may elect a lump sum or a schedule of annual installments, up to a maximum of 15 annual installments.

3. Manner of Elections

     All elections under the Program shall be made in the manner and in accordance with the process approved by the Company’s head of Human Resources Department from time to time.

C. Election of Investment Alternatives

     The participant shall designate, in accordance with procedures established by the Company for such designation, the portion (in multiples of 1%) of the Deferred Compensation to be allocated to any investment alternative available under this Program.

IV. VALUATION OF DEFERRED COMPENSATION ACCOUNTS

A. Common Stock

1. Initial Crediting

     The amount allocated to Merck Common Stock shall be used to determine the number of full and partial shares of Merck Common Stock which such amount would purchase at the closing price of Merck Common Stock on the New York Stock Exchange on the date cash payments of base salary, for amounts deferred under the Base Salary Deferral Plan, or incentive awards, for amounts deferred under the various incentive plans, would otherwise be paid to the participant (“the Deferral Date”). Should the Committee determine that valuation on any Deferral Date would not constitute fair market value, then the Committee shall decide on which date fair market value shall be determined using the valuation method set forth in this paragraph. The Company shall credit the participant’s Deferred Compensation Account with the number of full and partial shares of Merck Common Stock so determined. However, at no time prior to the delivery of such

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shares shall any shares be purchased or earmarked for such Account and the participant shall not have any of the rights of a shareholder with respect to shares credited to his/her Deferred Compensation Account.

2. Dividends

     The Company shall credit the Participant’s Deferred Compensation Account with the number of full and partial shares of Merck Common Stock purchasable at the closing price of Merck Common Stock on the New York Stock Exchange as of the date each dividend is paid on the Common Stock, with the dividends which would have been paid on the number of shares credited to such Account (including pro rata dividends on any partial share) had the shares so credited then been issued and outstanding.

3. Redesignations

     The value of Merck Common Stock for purposes of redesignation shall be the closing price of Merck Common Stock on the New York Stock Exchange on (i) the day when the redesignation request is received pursuant to administrative guidelines established by the Human Resources Financial Services area of the Treasury department, provided the request is received prior to the close of the New York Stock Exchange on such day or (ii) the next following business day if the request is received when the New York Stock Exchange is closed.

4. Distributions

     Distributions of Merck Common Stock will be valued at the closing price of Merck Common Stock on the New York Stock Exchange on the distribution date.

5. Limitations

     Shares of Merck Common Stock to be delivered under the provisions of this Program may be delivered by the Company from its authorized but unissued shares of Common Stock or from Common Stock held in the treasury. The amount of shares available each year under this Program shall be one-tenth of one-percent of outstanding shares of Merck Common Stock on the last business day of the preceding calendar year plus any shares authorized under this Program in previous years but not used, minus any shares distributed under the Executive Incentive Plan after April 26, 1994.

6. Adjustments

     In the event of a reorganization, recapitalization, stock split, stock dividend, combination of shares, merger, consolidation, rights offering or any other change in the corporate structure or shares of the Company, the number and kind of shares of Merck Common Stock available under this Program or credited to participants’ Deferred Compensation Accounts shall be adjusted accordingly.

B. Mutual Funds

1. Initial Crediting

     The amount allocated to each Mutual Fund shall be used to determine the number of full and partial Mutual Fund shares that such amount would purchase at the closing net asset value of

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the Mutual Fund shares on the Deferral Date. The Company shall credit the participant’s Deferred Compensation Account with the number of full and partial Mutual Fund shares so determined. However, no Mutual Fund shares shall be purchased or earmarked for such Account, nor shall the participant have the rights of a shareholder with respect to such Mutual Fund shares.

2. Dividends

     The Company shall credit the participant’s Deferred Compensation Account with the number of full and partial Mutual Fund shares purchasable, at the closing net asset value of the Mutual Fund shares as of the date each dividend is paid on the Mutual Fund shares, with the dividends which would have been paid on the number of shares credited to such Account (including pro rata dividends on any partial share) had the shares then been owned by the participant for purposes of the above computation.

3. Redesignations

     The value of Mutual Fund shares for purposes of redesignation shall be the net asset value of such Mutual Fund at the close of business on (i) the day when the redesignation request is received pursuant to administrative guidelines established by the Human Resources Financial Services area of the Treasury department, provided the request is received prior to the close of the New York Stock Exchange on such day or (ii) the next following business day if the request is received when the New York Stock Exchange is closed.

4. Distributions

     Mutual Fund distributions will be valued based on the closing net asset value of the Mutual Fund shares on the distribution date.

5. Adjustments

     In the event of a reorganization, recapitalization, stock split, stock dividend, combination of shares, merger, consolidation, rights offering or any other change in the corporate structure or shares of a Mutual Fund, the number and kind of shares of that Mutual Fund credited to participants’ Deferred Compensation Accounts shall be adjusted accordingly.

V. REDESIGNATION WITHIN A DEFERRED COMPENSATION ACCOUNT

A. Basic Redesignation Rules

     A participant, or the beneficiary or legal representative of a deceased participant, may redesignate amounts credited to a Deferred Compensation Account among the investments available under this Program in accordance with the following rules:

(1)	Eligible Participants — Active employees, and Participants who incurred a Separation or Retirement are eligible to redesignate.
(2)	Frequency and Timing — Effective June 1, 1999, there is no limit on the number of times a participant may redesignate amounts measured by Mutual Funds, or, subject to Section B, below, Merck Common Stock. Redesignation shall take place on (i) the day when the redesignation request is received pursuant to administrative guidelines

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	established by the Human Resources Financial Services area of the Treasury department, provided the request is received prior to the close of the New York Stock Exchange on such day or (ii) the next following business day if the request is received when the New York Stock Exchange is closed.
(3)	Amount and Extent of Redesignation — Redesignation must be in 1% multiples of the investment from which redesignation is being made.
(4)	Beneficiaries or Legal Representatives — The beneficiary or legal representative of a deceased participant may redesignate subject to the same rules as participants.

B. Special Rules for Redesignation Out of Common Stock

1. Frequency and Timing

     For Section 16 Officers, redesignations may only be made out of Merck Common Stock during any window period established by the Company from time-to-time and is restricted to amounts held in Merck Common Stock for longer than six months.

2. Material, Nonpublic Information

     The Committee, in its sole discretion and with advice of counsel, at any time may rescind a redesignation out of Merck Common Stock if such redesignation was made by a participant who, (a) at the time of the redesignation was in the possession of material, nonpublic information with respect to the Company; and (b) in the Committee’s estimation benefited from such information in the timing of his/her redesignation. The Committee’s determination shall be final and binding. In the event of such rescission, the participant’s Deferred Compensation Account shall be returned to a status as though such redesignation had not occurred. Notwithstanding the above, the Committee shall not rescind a redesignation if the facts were reviewed by the participant with the General Counsel of the Company or a designee prior to the redesignation and if the General Counsel or designee had concluded that such participant was not in possession of adverse material, nonpublic information.

C. Conversion of Common Stock Accounts

     The Committee may, in its sole discretion, convert all of the shares of Merck Common Stock allocated to a participant’s Deferred Compensation Account in the manner provided below where a position which a participant has taken or wishes to take is, in the opinion of the Committee, such as would make uncertain the propriety of the participant’s having a continued interest in Merck Common Stock. The date of conversion shall be the date of commencement of such other employment or the date of the Committee’s action, whichever is later.

     Conversion shall be from an expression of value in shares of Merck Common Stock in the participant’s Deferred Compensation Account to an expression of value in United States dollars in another available investment. The value of the Merck Common Stock shall be based upon its closing price on the New York Stock Exchange on the date of conversion or if no trading took place on such day, the next business day on which trading took place. Any conversion under this paragraph shall be irrevocable and absolute.

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VI. DISTRIBUTION OF DEFERRED COMPENSATION ACCOUNTS

     Distribution of Deferred Compensation Accounts shall be made in accordance with the participant’s distribution schedule pro rata by investment. Distributions from Merck Common Stock will be made in shares, with cash payable for any partial share, subject to the limitations set forth in Article IV, Section A.5. For Section 16 Officers, distribution of amounts in Merck Common Stock is also restricted to amounts held in Merck Common Stock for longer than six months. Distributions from Mutual Funds will be in cash. Distributions will be valued on the fifteenth day of the distribution month (or, if such day is not a business day, the next business day) and paid as soon thereafter as practicable.

A. Retirement

     A participant’s Retirement from active service will cause distributions of his/her Deferred Compensation Account to commence as soon as administratively feasible in accordance with the participant’s previously elected schedule. “Retirement” means a termination of employment at a time when the participant is eligible for Early, Normal, or Deferred Retirement under the Retirement Plan for Salaried Employees of Merck & Co., Inc., or other applicable qualified retirement plan (the “Retirement Plan”) or when the participant has been approved for a Disability Retirement under the Retirement Plan, but only if the participant is “disabled” within the meaning of Section 409A. Such a participant may change his or her distribution schedule in accordance with Section G, below.

B. Death

     In the event of a participant’s death, distributions under this Program will be made in a lump sum as soon as administratively feasible.

C. Automatic Distribution

     If a participant terminates employment for reasons other than Retirement, death, Separation, or to take a position with a joint venture or other business entity defined in Section E, below, then his/her Deferred Compensation Account will be automatically paid in a lump sum as soon as administratively feasible following his/her termination of employment. Furthermore, except as provided in Schedule II, any participant whose Deferred Compensation Account is valued at less than $125,000 on the date of his/her termination of employment for any reason whatsoever will have his/her Deferred Compensation Account distributed in a lump sum as soon as administratively feasible following such termination.

D. Termination Due to Separation

     If a participant is employed by a subsidiary of the Company that is sold, so that the subsidiary is no longer considered within the controlled group of the Company, that participant shall be considered to have terminated employment with the Company for purposes of this Program. If a participant’s employment terminates as a result of a “Separation” that is, a divestiture of a division or subsidiary of the Company, or as a result of a separation due to a reorganization, reduction in force, or elimination of the participant’s job, then distributions under this Program will commence as soon as administratively feasible after such termination of employment in accordance with his/her previously elected schedule or such schedule as re-elected in accordance with Section G, below.

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E. Joint Venture Service

     A participant’s termination of employment in order to take a position with a joint venture or other business entity in which the Company shall directly or indirectly own fifty percent or more of the outstanding voting or other ownership interest shall not be considered a termination of employment with the Company for purposes of distribution under this Program.

F. Hardship Distributions

     The Committee, in its sole discretion, may accelerate the time of distribution of a participant’s Deferred Compensation Account, if the participant experiences severe financial hardship due to illness, accident or death in the immediate family, loss of or damage to property due to casualty, or other extraordinary and unforeseeable circumstances. Such participant should provide the Committee with a statement in reasonable detail as to the nature of such financial hardship together with a statement that such acceleration is necessary to alleviate such hardship.

G. Modifications to Distribution Schedule

     A participant who is an employee, or one who has had a Retirement or a Separation may elect to change his or her distribution schedule from time to time, provided, however, such changes shall not be permitted if it might reasonably be expected to cause a “plan failure” as such term is used in Section 409A of the Code; for example, no such election would be permitted if it would accelerate a distribution, or if it became effective earlier than one year from the date it were made, or if it permitted an additional deferral that commenced earlier than 5 years from the previously scheduled distribution date, except as otherwise permitted by Section 409A. Any such elections shall be made in the manner and in accordance with the process approved by the Company’s head of Human Resources Department from time to time.

VII. DEDUCTIONS FROM DISTRIBUTIONS

     The Company will deduct from each distribution amounts required to be withheld for income, Social Security and other tax purposes. Such withholding will be done on a pro rata basis per investment. The Company may also deduct any amounts the participant owes the Company for any reason.

VIII. BENEFICIARY DESIGNATIONS

     A participant under this program may designate a beneficiary to receive his/her Deferred Compensation Account upon the participant’s death. If the beneficiary predeceases the participant or if the participant does not name a beneficiary, the participant’s Deferred Compensation Account will be distributed to the participant’s estate.

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IX. AMENDMENTS

     The Committee may amend this Program at any time. However, such amendment shall not materially adversely affect any right or obligation with respect to any Deferred Compensation made theretofore.

     For two years following a change in control of the Company (as such term is defined in the Change in Control Separation Benefits Plan) the material terms of the Program (including terms relating to eligibility, benefit calculation, benefit accrual, cost to participants, subsidies and rates of employee contributions) may not be modified in a manner that is materially adverse to individuals who participated immediately before the change in control. The Company will pay the legal fees and expenses of any participant that prevails on his or her claim for relief in an action regarding an impermissible amendment to the Program (other than ordinary claims for benefits) or, if applicable, in an action regarding restrictive covenants applicable to the participant.

X. SECTION 409A

     The Deferral Program is a “nonqualified deferred compensation plan” within the meaning of Section 409A of the Code. Anything in the Deferral Program to the contrary notwithstanding, the Deferral Program shall be operated in compliance with the requirements, if any, of Section 409A (or any successor thereto) as in effect from time to time, including but not limited to applicable regulations of the U.S. Department of the Treasury or Internal Revenue Service. Anything in the Program to the contrary notwithstanding, to the extent required by Section 409A, distributions on account of a “separation from service” to a “specified employee,” as such terms are defined in Section 409A, may not be made before the date which is 6 months after the date of separation from service (or, if earlier, the date of death of the employee).

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SCHEDULE I

DEFERRAL PROGRAM INVESTMENT ALTERNATIVES

     Until determined otherwise, investment alternatives shall be the same investment alternatives offered under the Merck & Co., Inc. Employee Savings and Security Plan (the “401(k) Plan”) as in effect from time to time. The Merck Common Stock fund offered under the Deferral Program shall be measured as if it were invested 100% in Merck Common Stock.

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SCHEDULE II

SPECIAL PROVISIONS APPLICABLE TO
MEDCO HEALTH EMPLOYEES
(Approved July 23, 2002)

DEFINITIONS

Medco Health — Medco Health Solutions, Inc.

Medco Health Employee — A participant who is (i) employed by Medco Health prior to the Spin-Off or (ii) employed by Merck prior to the Spin-Off and expected to be employed by Medco Health prior to or as of the Spin-Off.

Separated Medco Health Employee — A participant in the Deferral Program who is employed by Medco Health as of the date of the Spin-Off and is considered to have terminated employment with the Company as a result of the Spin-Off.

Spin-Off — The distribution by Merck to its shareholders of the equity securities of Medco Health. The Spin-Off will be a divestiture for purposes of the Deferral Program.

SPECIAL PROVISIONS

Notwithstanding anything to the contrary in Article VI, Section C of the Deferral Program, the Deferred Compensation Account of each Separated Medco Health Employee shall be paid out in accordance with Article VI, Section D, without regard to the $125,000 threshold set forth in Section C.

Notwithstanding anything to the contrary in Article VI, Section G of the Deferral Program, each Medco Health Employee may submit the petition for an extension of the distribution schedule permitted under Section G either prior to the Spin-Off or once the Medco Health Employee has become a Separated Medco Health Employee; provided, however, that if a Medco Health Employee makes a request for a new distribution schedule prior to the Spin-Off and thereafter does not become a Separated Medco Health Employee, then such request shall not be effective.

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SCHEDULE III

SPECIAL TRANSITION PROVISIONS UNDER AJCA
(effective December 15, 2005)

Anything in the Program to the contrary notwithstanding, prior to the end of 2005, Eligible Participants may elect to cancel any or all prior deferral elections into the Deferral Program.

To the extent shares of Merck Common Stock are distributed as a result of any such cancellation, a dividend equivalent for the amount that would be paid if the shares were held by a shareholder on November 30, 2005 will be distributed before December 31, 2005.

Distribution of Deferred Compensation the election of which has been cancelled shall be made no later than December 31, 2005.

For purposes of this Schedule, Eligible Participants include all participants in the Program.

Anything in the Program to the contrary notwithstanding, where a participant has elected that distributions be made beginning in the year of retirement, distribution shall not be made in 2006 for participants who have a Retirement or Separation, in 2006 (“Active Eligible Participants”); provided, however, Automatic Distributions pursuant to Paragraph C. of Article VI shall be made in 2006 to the extent applicable.

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