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): February 18, 2005

Merck & Co., Inc.
__________________________________________
(Exact name of registrant as specified in its charter)

New Jersey	1-3305	22-1109110
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)
One Merck Drive, P.O. Box 100, Whitehouse Station, New Jersey		08889
_________________________________ (Address of principal executive offices)		___________ (Zip Code)

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

Not Applicable
______________________________________________
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:

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01. Entry into a Material Definitive Agreement.

Merck & Co., Inc. ("Merck") has adopted term sheets under the Merck & Co., Inc. 2004 Incentive Stock Plan (the "ISP") pursuant to which grants may be made after January 27, 2005 to employees with respect to (a) options to purchase shares of common stock of Merck and (b) units of restricted stock ("RSUs") of Merck common stock. The term sheet for options sets forth option term, vesting and exercise periods, and information regarding termination of employment and transferability. The term sheets for RSUs set forth the restricted period, and information regarding termination of employment and transferability. The foregoing summary is qualified in its entirety by reference to the text of the form term sheets, which are filed as exhibits to this report.

Item 9.01. Financial Statements and Exhibits.

(c) Exhibits

Exhibit 10.1 - Stock option terms for a non-qualified stock option under the Merck & Co., Inc. 2004 Incentive Stock Plan

Exhibit 10.2 - Restricted stock unit terms for annual grant under the Merck & Co., Inc. 2004 Incentive Stock Plan

Exhibit 10.3 - Restricted stock unit terms for Leader Shares grant under the Merck & Co., Inc. 2004 Incentive Stock Plan

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.
February 18, 2005	By:	/s/ Debra A. Bollwage
		Name: Debra A. Bollwage
		Title: Senior Assistant Secretary

Exhibit Index

Exhibit No.	Description
10.1	Stock option terms for a non-qualified stock option under the Merck & Co., Inc. 2004 Incentive Stock Plan
10.2	Restricted stock unit terms for annual grant under the Merck & Co., Inc. 2004 Incentive Stock Plan
10.3	Restricted stock unit terms for Leader Shares grant under the Merck & Co., Inc. 2004 Incentive Stock Plan

EX-10.1

Exhibit 10.1

STOCK OPTION TERMS
FOR A NON-QUALIFIED STOCK OPTION (NQSO)
UNDER THE MERCK & CO., INC. 2004 INCENTIVE STOCK PLAN

This is a summary of the terms applicable to the stock option specified on this document. Different terms may apply to any prior or future stock option. These Stock Option Terms apply to the Annual and Quarterly Stock Options granted in 2005.

I. GENERAL INFORMATION

This stock option becomes exercisable in equal installments (subject to rounding process) on the Vesting Dates indicated in the accompanying box. This stock option expires on its Expiration Date, which is the day before the tenth anniversary of the Grant Date. If your employment with the Company is terminated, your right to exercise this stock option will be determined according to the terms in Section II.

II. TERMINATION OF EMPLOYMENT

A. General Rule. If your employment is terminated for any reason other than those specified in the following paragraphs, the portion of this stock option that is unvested will expire on the date your employment ends; the portion of this stock option that is vested will expire on the day before the same date of the third month after your employment ends, but in no event later than the original Expiration Date.

B. Retirement. If you retire from service with the Company, this stock option will continue to become exercisable on applicable Vesting Dates and will expire on its original Expiration Date.

C. Separation. If your employment is terminated and the Company determines that such termination resulted from the elimination of your job or the sale of your subsidiary, division or joint venture, the portion of this stock option that is unvested will vest immediately upon such termination. Whether already vested on the date of your separation or vested as a result of your separation, this stock option will expire the day before the second anniversary of the date your employment with the Company ends, but in no event later than the original Expiration Date. Notwithstanding the foregoing, the Compensation and Benefits Committee of the Board of Directors of Merck & Co., Inc., may determine, for purposes of this stock option grant, whether employment with an entity that is established from the Company’s spin off, split off, split up or distribution of equity securities in connection with that entity constitutes a termination of employment or separation, and may make adjustments, if any, as it deems appropriate, at the time of the distribution of such equity securities, in the kind and/or number of shares subject to this option, and/or in the option price of such option.

D. Misconduct. If your employment is terminated as a result of your deliberate, willful or gross misconduct, this stock option (whether vested or unvested) will expire immediately upon your receipt of notice of such termination.

E. Death. If you die, the portion of this stock option that is unvested will vest immediately upon your death. Whether already vested on the date of your death or vested as a result of your death, this stock option will expire on the earlier of: (a) the day before the third anniversary of your death, or (b) the later of (i) the Original Expiration date or (ii) the day before the first anniversary of your death. This stock option will expire on such earlier date than otherwise specified in this paragraph as may be required under applicable non-U.S. law (e.g., in France, six months from the date of death).

F. Change in Control. Upon a change in control of the Company, this stock option will become fully vested and will remain exercisable for five years following termination of your employment following a change in control (but not beyond the Expiration Date). This extended exercise period does not apply in the case of termination by reasons of retirement, misconduct or death, as described in paragraphs B, D and E above or termination prior to a change in control. If this stock option does not remain outstanding following the change in control and is not converted into a successor stock option, then you will be entitled to receive cash for this option in an amount at least equal to the difference between the price paid to stockholders in the change in control and the Option Price of this stock option. A “change in control” has the same meaning that it has under the Merck & Co., Inc. Change in Control Separation Benefits Plan.

G. Joint Venture. Employment with a joint venture or other entity in which the Company has determined that it has a significant business or ownership interest (a “JV”) is not considered termination of employment for purposes of this stock option. If you transfer employment from the Company to a JV or from a JV to the Company, such employment must be approved by, and contiguous with employment by, the Company or the JV. The terms set out in paragraphs A-F above apply to this stock option while the option holder is employed by the JV.

III. TRANSFERABILITY

This stock option is not transferable and may not be assigned or otherwise transferred except, under specific terms, by executives who hold or who retired within the prior twelve (12) months from a Grade 1 or Section 16 position.

This stock option is subject to the provisions of the 2004 Incentive Stock Plan and the Rules and Regulations thereunder established by the Compensation and Benefits Committee of the Board of Directors of Merck & Co., Inc. For further information regarding your stock options, you may access the Merck Stock Option homepage at http://humres.merck.com/stockoptions, which includes links to the Prospectus for the 2004 Incentive Stock Plan and the Company’s Annual Report and Proxy Statement.

Exhibit 10.2

RESTRICTED STOCK UNIT TERMS
FOR ANNUAL GRANT
UNDER THE MERCK & CO., INC. 2004 INCENTIVE STOCK PLAN

This is a summary of the terms applicable to the Restricted Stock Unit (RSU) Award specified on this document. Different terms may apply to any prior or future RSU Awards. These are the grant terms for the 2005 Annual Restricted Stock Unit Grant. They may be amended by the Merck Compensation and Benefits Committee of the Board of Directors as permitted by the ISP.

I. GENERAL INFORMATION

A. Restricted Period. The Restricted Period is the period during which this RSU Award is restricted and subject to forfeiture. The Restricted Period begins on the Grant Date and ends on the earlier of (a) the third anniversary of the Grant Date and (b) a Change in Control, as such term is defined in the Change in Control Separation Benefits Plan, except as to awards that are deferred compensation subject to the American Jobs Creation Act of 2004 (the “AJCA”), in which event the definition as modified to the extent necessary to comply with the AJCA will apply.

B. Dividend Equivalents. During the Restricted Period, dividend equivalents will be paid to the holder (“you”) around the same time dividends, if any, are paid by the Company on Merck Common Stock. Any payment of dividend equivalents will be reduced to the extent necessary for the Company to satisfy any tax or other withholding obligations. No voting rights apply to this RSU Award.

C. Distribution. Upon the expiration of the Restricted Period if you are then employed, you will be entitled to receive a number of shares of Merck common stock equal to the number of RSUs that have become unrestricted. Prior to distribution, you must deliver to the Company an amount the Company determines to be sufficient to satisfy any amount required to be withheld, including applicable taxes. The Company may, in its sole discretion, withhold from the RSU Award distribution a number of shares to pay applicable withholding (including taxes).

II. TERMINATION OF EMPLOYMENT

If your employment with the Company is terminated during the Restricted Period, your right to this RSU Award will be determined according to the terms in this Section II.

A. General Rule. If your employment is terminated during the Restricted Period for any reason other than those specified in the following paragraphs, this RSU Award will be forfeited on the date your employment ends.

B. Separation. If your employment is terminated during the Restricted Period and the Company determines that such termination resulted from the elimination of your job or the sale of your subsidiary, division or joint venture, a pro rata portion (based on the number of completed months held) will be distributed as soon as possible after such separation date. The remainder will be forfeited on the date your employment ends.

C. Retirement. If you terminate employment during the Restricted Period by retirement (including early and disability retirement) (“Retirement”) on or after the same day of the sixth month after the Grant Date, then this RSU Award will continue and be distributable in accordance with its terms as if employment had continued and will be distributed at the time active RSU Grantees receive distributions with respect to this Restricted Period. If your Retirement occurs before the same day of the sixth month after the Grant Date, then this RSU Award will be forfeited on the date your employment ends.

D. Death. If you die during the Restricted Period, a pro rata portion of this RSU Award (based on the number of completed months held) will be distributed to your estate as soon as possible after your death.

E. Misconduct. If your employment is terminated as a result of your deliberate, willful or gross misconduct, this RSU Award, will be forfeited immediately upon your receipt of notice of such termination.

F. Joint Venture. Employment with a joint venture or other entity in which the Company has a significant business or ownership interest is not considered termination of employment for purposes of this RSU Award. Such employment must be approved by, and contiguous with employment by, the Company, as described more fully in the Rules and Regulations. The terms set out in paragraphs A-E above apply to this RSU Award while you are employed by the joint venture or other entity.

III. TRANSFERABILITY

This RSU Award is not transferable and may not be assigned or otherwise transferred.

This RSU Award is subject to the provisions of the 2004 Incentive Stock Plan and the Rules and Regulations thereunder established by the Compensation and Benefits Committee of the Board of Directors of Merck & Co., Inc.

Exhibit 10.3

RESTRICTED STOCK UNIT TERMS
FOR LEADER SHARES GRANT
UNDER THE MERCK & CO., INC. 2004 INCENTIVE STOCK PLAN

This is a summary of the terms applicable to the Restricted Stock Unit (RSU) Award specified on this document. Different terms may apply to any prior or future RSU Awards. These are the grant terms for the 2005 Leader Shares Restricted Stock Unit Grant. They may be amended by the Merck Compensation and Benefits Committee of the Board of Directors as permitted by the ISP.

I. GENERAL INFORMATION

A. Restricted Period. The Restricted Period is the period during which this RSU Award is restricted and subject to forfeiture. The Restricted Period begins on the Grant Date and ends on the earlier of (a) the third anniversary of the Grant Date and (b) a Change in Control, as such term is defined in the Change in Control Separation Benefits Plan, except as to awards that are deferred compensation subject to the American Jobs Creation Act of 2004 (the “AJCA”), in which event the definition as modified to the extent necessary to comply with the AJCA will apply.

B. Dividend Equivalents. During the Restricted Period, dividend equivalents will be paid to the holder (“you”) around the same time dividends, if any, are paid by the Company on Merck Common Stock. Any payment of dividend equivalents will be reduced to the extent necessary for the Company to satisfy any tax or other withholding obligations. No voting rights apply to this RSU Award.

C. Distribution. Upon the expiration of the Restricted Period if you are then employed, you will be entitled to receive a number of shares of Merck common stock equal to the number of RSUs that have become unrestricted. Prior to distribution, you must deliver to the Company an amount the Company determines to be sufficient to satisfy any amount required to be withheld, including applicable taxes. The Company may, in its sole discretion, withhold from the RSU Award distribution a number of shares to pay applicable withholding (including taxes).

II. TERMINATION OF EMPLOYMENT

If your employment with the Company is terminated during the Restricted Period, your right to this RSU Award will be determined according to the terms in this Section II.

A. General Rule. If your employment is terminated during the Restricted Period for any reason other than those specified in the following paragraphs, this RSU Award will be forfeited on the date your employment ends.

B. Separation. If your employment is terminated during the Restricted Period and the Company determines that such termination resulted from the elimination of your job or the sale of your subsidiary, division or joint venture, a pro rata portion (based on the number of completed months held) will be distributed as soon as possible after such separation date. The remainder will be forfeited on the date your employment ends.

C. Retirement. If you terminate employment during the Restricted Period by retirement (including early and disability retirement) (“Retirement”) on or after the one-year anniversary of the Grant Date, then a pro rata portion (based on the number of completed months held prior to the Retirement date) of this Award shall be distributed as soon as possible after such Retirement. If your Retirement occurs before the one-year anniversary of the Grant Date, then this RSU Award will be forfeited on the date your employment ends.

D. Death. If you die during the Restricted Period, a pro rata portion of this RSU Award (based on the number of completed months held) will be distributed to your estate as soon as possible after your death.

E. Misconduct. If your employment is terminated as a result of your deliberate, willful or gross misconduct, this RSU Award, will be forfeited immediately upon your receipt of notice of such termination.

F. Joint Venture. Employment with a joint venture or other entity in which the Company has a significant business or ownership interest is not considered termination of employment for purposes of this RSU Award. Such employment must be approved by, and contiguous with employment by, the Company, as described more fully in the Rules and Regulations. The terms set out in paragraphs A-E above apply to this RSU Award while you are employed by the joint venture or other entity.

III. TRANSFERABILITY

This RSU Award is not transferable and may not be assigned or otherwise transferred.

This RSU Award is subject to the provisions of the 2004 Incentive Stock Plan and the Rules and Regulations thereunder established by the Compensation and Benefits Committee of the Board of Directors of Merck & Co., Inc.