CALL OPTION AGREEMENT

(1)

Schering-Plough Corporation , a corporation organized under the laws of New Jersey (“ Schering-Plough ”);

(2)

Merck & Co., Inc. ,   a corporation organized under the laws of New Jersey (“ Merck ”);  

(3)

Sanofi-Aventis , a société anonyme organized under the laws of France (“ Sanofi-Aventis ”)

(A)

Merck and Schering-Plough are parties to that certain Agreement and Plan of Merger, dated March 8, 2009 (the “ Merger Agreement ”), by and among Schering-Plough, Merck and two Subsidiaries of Schering-Plough formed to execute the merger of one of the Subsidiaries into Schering-Plough such that Schering-Plough is the surviving corporation in such merger and the other Subsidiary into Merck such that Merck is the surviving corporation in such merger (the “ Merger ”) and becomes a wholly-owned Subsidiary of Schering-Plough;

(B)

Each of Merck and Sanofi-Aventis owns, indirectly, 50% of the outstanding equity interests in Merial Limited, a private company limited by shares organized under the laws of England and domesticated in Delaware as a limited liability company (“ Merial ”). Merial and its Subsidiaries are engaged in the discovery and development, manufacturing, marketing and sale of pharmaceutical, biological and medicinal products to enhance the health or performance of animals (collectively, the “ Merial Business ”);

(C)

Schering-Plough and its Subsidiaries are engaged in the animal health business, including discovery and development, manufacturing and sale of veterinary products in all major food producing and companion animal species (collectively, the “ I/SP Business ”), which is conducted through Intervet Holdings B.V., Intervet, Inc. and certain other Subsidiaries of Schering-Plough (the “ I/SP Entities ”);

(D)

Merck and Sanofi-Aventis have agreed, pursuant to a share purchase agreement, dated as of the date hereof (the “ Share Purchase Agreement ”), by and among Sanofi-Aventis, Merck and certain of Merck’s Subsidiaries, that certain of Merck’s Subsidiaries will sell to Sanofi-Aventis or a Subsidiary of Sanofi-Aventis and Sanofi-Aventis or such Subsidiary will buy from Merck’s Subsidiaries, all of the equity interests in Merial owned by Merck and its Subsidiaries (the “ Merial Equity Interests ”) such that Sanofi-Aventis will then own, directly or indirectly, all of the outstanding equity interests in Merial; and

·

Statement of Net Sales and Expenses for the I/SP Business pursuant to the requirements of Rule 3-05 of Regulation S-X. These statements will include net sales less expenses attributable to the I/SP Business. Expenses would include all direct expenses, such as cost of sales, sales and marketing, depreciation and amortization, foreign exchange transaction gains and losses, special and acquisition related charges and all allocations of corporate administrative expenses that have historically been made by Schering-Plough and would only exclude interest, income taxes and the costs of Schering-Plough’s senior executive management (which is considered to be part of corporate overhead);

·

Statement of Assets Acquired and Liabilities Assumed pursuant to the requirements of Rule 3-05 of Regulation S-X. This statement will consist only of the assets acquired and liabilities to be assumed by an acquirer;

·

To the extent available, selected cash flow information about cash flows relating to the I/SP Business in the notes to the financial statements. Such information will be prepared consistent with the Statement of Assets Acquired and Liabilities Assumed and Statement of Net Sales and Expenses; and

·

The notes to the I/SP Business financial statements will disclose the basis of presentation and the nature of the omitted items;

3

Call Right

3.1.1

Upon the terms and subject to the conditions of this Agreement, Schering-Plough hereby grants to Sanofi-Aventis, or any Affiliate of Sanofi-Aventis that Sanofi-Aventis may designate, an irrevocable option (the “ Call Right ”) to acquire from Schering-Plough (by way of contribution to Merial) all (but not less than all) of the then-outstanding equity interests in the I/SP Entities (holding all of the I/SP Business) following completion of the Merger such that Schering-Plough (and/or one or more Affiliates of Schering-Plough that Schering-Plough may designate) and Sanofi-Aventis (and/or one or more Affiliates of Sanofi-Aventis that Sanofi-Aventis may designate) each, following the completion of the adjustment, if any, contemplated by Clauses 3.6.2 and 3.6.3, respectively holds 50% of the equity interests in Merial.

3.1.2

Sanofi-Aventis may elect, in its sole and unfettered discretion, subject to the conditions set forth herein and only after consummation of the Merger, to exercise or not exercise the Call Right at any time on or prior to 5:00 p.m. New York City time on the Expiration Date in accordance with the provisions of Clause 3.5.1.

3.1.3

Schering-Plough grants this Call Right for payment by Sanofi-Aventis to Schering-Plough of the sum of one (1) US dollar in cash upon the execution hereof.

3.2

Due diligence

3.2.1

During the 10 Business Days following the completion of the Merger, Merck and Sanofi-Aventis shall use good faith efforts to negotiate and enter into a confidentiality agreement on customary and reasonable terms.  If by the end of such period they are unable to agree the form of, and enter into, such a confidentiality agreement, they shall execute and deliver on the last day of such period the New Confidentiality Agreement. Commencing no later than 10 Business Days following the completion of the Merger and continuing through the Expiration Date (such period, the “ Due Diligence Period ”), Merck and Schering-Plough shall provide Sanofi-Aventis and its Affiliates and their Representatives (including Merial personnel that are reasonably acceptable to Merck and Schering-Plough) with reasonable and prompt access during regular business hours to information regarding the I/SP Business that is reasonably necessary or customary for a transaction of this nature to conduct due diligence, including:

(i)

access to an electronic data room containing documents relating to the I/SP Business that were provided to Third Party bidders in the process conducted by Merck for the potential sale of the I/SP Business to one or more Third Parties (updated through the closing date of the Merger), including the right to make copies of the same; provided , however , that Sanofi-Aventis and its Representatives shall not have access to any information relating to any litigation between Sanofi-Aventis or its Affiliates, on the one hand, and Schering-Plough or its Affiliates, on the other hand, or the subject matter of such litigation;

(ii)

the provision of the following financial statements:

(a)

audited Abbreviated Financial Statements for the fiscal year ending December 31, 2008;

(b)

unaudited Abbreviated Financial Statements for the six-month period ended June 30, 2009 (subject to limited review standard by auditors);

(c)

any subsequent quarterly or Pre-Merger Stub Period unaudited Abbreviated Financial Statements prior to the Merger (subject to limited review standard by auditors), to be provided as soon as available but in any event no later than 45 days following the end of such quarter; and

(d)

any subsequent quarterly Post-Merger Stub Period unaudited financial statements following the Merger prepared in a form substantially consistent with the Abbreviated Financial Statements but reflecting purchase accounting and other potential changes, such as in allocation methodology, in connection with the Merger (subject to limited review standard by auditors), to be provided as soon as available but in no event later than 45 days following the end of such quarter (or if applicable law or regulation would not permit such delivery within such 45-day period, as soon as such applicable law or regulation would permit such delivery).

(iii)

any other up-to-date books, records or other information and documents relating to the I/SP Business as shall be reasonably requested by Sanofi-Aventis, subject to applicable law;

(iv)

access to the management team of the I/SP Business (through management presentations or otherwise);

(v)

access to the properties, assets and manufacturing facilities of the I/SP Business (through site visits); and

3.2.2

For purposes of this Agreement, the “ Commencement Date ” shall be the date that is 10 Business Days following the completion of the Merger, except that if Sanofi-Aventis has complied with its obligations under the first sentence of Clause 3.2.1 and Merck and Schering-Plough shall not have provided Sanofi-Aventis reasonable access to the materials contemplated by Clause 3.2.1(i) and Clause 3.2.1(ii), subparagraphs (a) and (b) during such 10-Business Day period, the “ Commencement Date ” shall be the first date upon which Merck or Schering-Plough shall have provided Sanofi-Aventis reasonable access to the materials contemplated by Clause 3.2.1(i) and Clause 3.2.1(ii), subparagraphs (a) and (b).

3.3

Structure of the transaction

3.3.1

Upon exercise of the Call Right, the transactions described herein shall be made pursuant to the terms of a contribution agreement substantially in the form of Exhibit A attached hereto, with such disclosure schedules as shall be provided by the Parties (as such agreement may be modified in accordance with the terms of this Agreement, the “ Contribution Agreement ”), to be entered into by Sanofi-Aventis, Schering-Plough (and/or one or more Affiliates of Schering-Plough that Schering-Plough may designate) and Merial.

3.3.2

Until the 75 th day of the Due Diligence Period, the Parties shall discuss and negotiate in good faith any desired amendments to (x) the structure of the transactions contemplated by this Agreement and the Contribution Agreement to the extent that any such proposal would conform to the principles specified in Clause 3.3.3 and/or (y) the other terms of the Contribution Agreement such as the representations, warranties and indemnities; provided that (i) no amendments shall be made to the structure of the transaction and/or the other terms of the Contribution Agreement unless the Parties agree thereto and (ii) in the event that the Parties are unable to otherwise agree on any such amendments, the Parties shall use the structure and the terms and conditions initially contemplated for by this Agreement and the Contribution Agreement.

3.3.3

For the purposes of Clause 3.3.2, the following principles shall be applied by the Parties:

(i)

the Parties agree to use their respective commercially reasonable efforts to maximize the tax efficiency to the Parties, Merial and its Subsidiaries, the I/SP Entities and their respective Affiliates of the transactions contemplated by this Agreement; `

(ii)

the I/SP Entities, when transferred to Merial, shall comprise all of the right, title and interest of Schering-Plough and its Subsidiaries to the assets, liabilities and the employees Related to the I/SP Business at such time (subject to obtaining any necessary third-party consents), and shall not include any assets or employees other than those Related to the I/SP Business at such time or any liabilities (except to the extent related to the I/SP Business at such time). Other than as contemplated by the Contribution Agreement, Schering-Plough will not retain after Closing any properties, assets and rights that are Related to the I/SP Business at such time;

(iii)

Merck and Schering-Plough shall be responsible for and bear any costs associated with any restructuring required to segregate the I/SP Business from Schering-Plough and its Affiliates’ other operations as well as to effect the transfer of the I/SP Business to Merial; and

(iv)

the I/SP Business shall be transferred so that with the arrangements described in subclauses (a) and (b) below Merial may operate the I/SP Business, in combination with the Merial Business, on a stand-alone basis and substantially as conducted during the 12-month period prior to the exercise of the Call Right. Schering-Plough agrees (a) to grant any appropriate intellectual property licenses or other types of similar arrangements or (b) for a reasonable transitional service period to provide, at cost, and for an agreed period of time, any service provided by Schering-Plough to the I/SP Business immediately prior to Closing, as may be required to achieve a timely and efficient transfer of the I/SP Business, in particular in connection with assets, properties or services that are not Related to the I/SP Business at such time and employees who are not primarily or exclusively dedicated to the I/SP Business at such time that are retained by Schering-Plough and are required to operate the I/SP Business in the ordinary course.

3.3.4

Subject to applicable law, the combined entities’ headquarters, management team and management structure shall be as jointly determined by Merck and Schering-Plough, on the one hand, and Sanofi-Aventis, on the other hand.

3.4

Documentation

3.4.1

At or prior to the Closing, the applicable Parties shall enter into, or cause their respective Affiliates to enter into, any other document or agreement as is reasonably necessary to effect the transfer of the I/SP Entities to Merial (or any of its Affiliates) at the Closing.

3.4.2

At the Closing, the Parties shall enter into a new shareholders agreement for the combined I/SP Entities and Merial that shall have the same terms as the Master Agreement, other than terms that are no longer applicable due to the passage of time or change in facts (together with any other changes thereto as may be agreed between the Parties (if any), the " Shareholders Agreement "). Accordingly, Sanofi-Aventis shall prepare and deliver to Merck and Schering-Plough a proposed form of the Shareholders Agreement that memorializes the agreement set forth in the preceding sentence within 10 days of the date of this Agreement, and promptly, and in any event within three (3) Business Days, following the receipt of such proposed form, Merck and Schering-Plough shall deliver to Sanofi-Aventis a written confirmation of the receipt of such form substantially in the form attached hereto as Exhibit D . The Parties agree that they will make their best efforts to confirm the form of the Shareholders Agreement reflects the agreement set forth in the first sentence of this Clause 3.4.2 within 75 days of this Agreement.  For the avoidance of doubt and without limitation to the foregoing, the terms of the Master Agreement under the article headings Objectives and Strategies, Business Scope, Merial Venture Companies, Governance, Certain Tax Matters, Profit and Loss Allocations, Dividends, Covenants, Non-Competition, Termination, Transfer of Interests, Change of Control, Dispute Resolution and Arbitration and Miscellaneous, and the related definitions and interpretive provisions for such articles, shall be fully included in the terms of the Shareholders Agreement.

3.4.3

Within 30 calendar days of the Commencement Date, each of Merck and Schering-Plough, on the one hand, and Sanofi-Aventis, on the other hand, shall deliver to the other disclosure schedules setting forth one or more exceptions to, or disclosures required by, the representations and warranties set forth in the Contribution Agreement.  Each of the Parties may update such disclosure schedules at any time up until the fifth Business Day prior to the Expiration Date.

3.5

Exercise

3.5.1

Following the completion of the Merger, and provided that Sanofi-Aventis (or any of its Affiliates) has consummated the acquisition of the Merial shares under the Share Purchase Agreement, Sanofi-Aventis may exercise the Call Right at any time until 5:00 p.m. New York City time on the 90th calendar day following the Commencement Date (such date, as may be extended by the next sentence, the “ Expiration Date ”).  In the event that an Independent Valuer is appointed pursuant to Clause 4.1.5 below, or if the MAC Amount (as defined in the Share Purchase Agreement) or the Other MAC Amount have not been finally determined in accordance with the terms of the Share Purchase Agreement or the terms hereof, the Expiration Date shall be extended until 10 Business Days following the final determination of the MAC Amount, the Other MAC Amount, and of the I/SP Enterprise Value by the Independent Valuer.

3.5.2

Sanofi-Aventis may exercise the Call Right by delivering to Schering-Plough a written notice of such exercise in the form attached hereto as Exhibit E   (the “ Call Notice ”), which notice shall, except as otherwise provided in Clause 9, be binding and irrevocable.

3.5.3

Upon exercise of the Call Right, the Parties undertake to execute the Contribution Agreement (incorporating any amendments as may be agreed by the Parties pursuant to Clause 3.3.2 and Clause 3.6.4) within five Business Days of delivery of such Call Notice.

3.6

Contribution Value

3.6.1

Upon the exercise of the Call Right in accordance with the terms hereof and subject to the satisfaction of the conditions precedent set forth in the Contribution Agreement, Schering-Plough agrees to (and to cause its Affiliates to) transfer and/or contribute the I/SP Entities to Merial in exchange for the issuance by Merial (the “ Merial Issuance ”) and transfer of a number of new shares in Merial with a value equal to the I/SP Contribution Value. The number of Merial shares to be issued to Schering-Plough shall be equal to the following calculation: I/SP Contribution Value divided by the Merial Share Value provided , however , that if a fraction of a Merial share would be issued pursuant to the foregoing calculation, Schering-Plough shall contribute to Merial an additional amount in cash equal to (x) the Merial Share Value minus (y) (i) the Merial Share Value multiplied by (ii) the fraction of a Merial share that would be issuable to Schering-Plough but for the operation of this proviso, and the number of Merial shares issued to Schering-Plough shall be correspondingly rounded upwards to the next whole integer.

3.6.2

The Merial shares, if any, held directly or indirectly by either Schering-Plough (and its Subsidiaries) or Sanofi-Aventis immediately following the Merial Issuance (and its Subsidiaries) in excess of 50% of the then outstanding aggregate Merial ordinary shares immediately following the Merial Issuance shall be the “ Excess Shares ”. It is the Parties’ intent that each of Schering-Plough and Sanofi-Aventis (and their relevant respective Subsidiaries) will each own 50% of the ordinary shares of Merial, 50% of the dividend rights of the ordinary shares of Merial and 50% of the voting rights in Merial.

3.6.3

In the event there are any Excess Shares, on the Closing Date, the Party holding such Excess Shares shall sell to the other Party, and the other Party shall purchase, the Excess Shares (provided that, if there are different classes of ordinary shares, such Party shall transfer such class of ordinary shares as it deems appropriate in its sole discretion) at a price per ordinary share equal to the Merial Share Value (such price, the “ Excess Price ”) by wire transfer of immediately available funds to an account designated by the seller of any such Excess Shares.

3.6.4

Until the 75 th day of the Due Diligence Period, the Parties may mutually agree on an alternate mechanism differing from that of Clauses 3.6.2 and 3.6.3 for the equalization of ownership in Merial and I/SP at the Closing, and neither Party will unreasonably object to such an alternate mechanism if such Party and its Affiliates, the I/SP Entities and Merial and its Subsidiaries would not be adversely impacted (more than a de minimis amount) by such alternate mechanism.

4

Determination of Value

4.1

I/SP Enterprise Value

4.1.1

Following the completion of the Merger, Merck and Schering-Plough and Sanofi-Aventis shall, based on the method set out in Clause 4.2, determine the I/SP Enterprise Value on a stand-alone basis as at the Valuation Date in accordance with Exhibit B .

4.1.2

Upon commencement of the Due Diligence Period, each of Merck and Schering-Plough, on the one hand, and Sanofi-Aventis, on the other hand, shall appoint an investment bank (each a “ Valuer ”) to assist it in determining the I/SP Enterprise Value.  Each of Sanofi-Aventis and Schering-Plough shall bear the costs of the Valuer it appoints pursuant to this Clause 4.1.2.

4.1.3

Each of Sanofi-Aventis and Schering-Plough, together with their respective Valuers, shall reach its own independent conclusions as to the I/SP Enterprise Value in accordance with Exhibit B , and shall provide the other with a simultaneous written notice (each a “ Valuation Notice ”) setting forth its calculation of the I/SP Enterprise Value in accordance with Exhibit B by at least 10 days prior to the Expiration Date.

4.1.4

If the highest figure (the “ High Value ”) provided by one Party on its Valuation Notice for the I/SP Enterprise Value is less than or equal to 120% of the lower figure (the “ Low Value ”) provided by the other on its Valuation Notice, then the I/SP Enterprise Value, as the case may be, shall equal the average of the High Value and the Low Value.

4.1.5

If the applicable High Value is more than 120% of the Low Value, Schering-Plough and Sanofi-Aventis shall within 5 calendar days after receipt of the last Valuation Notice appoint a mutually agreed-upon independent investment bank that does not act as a consultant or otherwise provide services to Sanofi-Aventis, Merck or Schering-Plough (the “ Independent Valuer ”) to determine the I/SP Enterprise Value within 30 days of its appointment.  Failing such agreement, the Independent Valuer shall be appointed by the American Arbitration Association pursuant to the list of expert financial valuators maintained by such agency. If the value provided by the Independent Valuer is closer to the applicable High Value, then the I/SP Enterprise Value shall equal the average of the value provided by the Independent Valuer and the applicable High Value ( provided that the I/SP Enterprise Value shall not be above the applicable High Value). If the value provided by the Independent Valuer is closer to the applicable Low Value, then the I/SP Enterprise Value shall equal the average of the value provided by the Independent Valuer and the applicable Low Value ( provided that the I/SP Enterprise Value shall not be below the Low Value). The fees of the Independent Valuer shall be borne equally by Schering-Plough and Sanofi-Aventis.

4.1.6

The Independent Valuer shall act as an expert and not as an arbitrator.  The determination of the Independent Valuer shall be final and binding on the Parties (in the absence of manifest error in which case the determination shall be void and shall be remitted to the Independent Valuer for correction).

4.1.7

The Parties shall ensure that the Parties, the Valuers and the Independent Valuer have such access to the accounting records and other relevant documents of the Parties as they may reasonably require, subject to such confidentiality obligations as the Parties may consider appropriate.

4.1.8

The final determination of the I/SP Enterprise Value (whether by the Parties, together with the Valuers, or by the Independent Valuer) shall be accompanied by a written report setting out the details of the determination of such value. Subject to a Party receiving from the Independent Valuer confidentiality and non-reliance undertakings reasonably acceptable to such Party,  such Party may provide the Independent Valuer with a copy of the written report of its Valuer at the time the Independent Valuer is appointed.

4.1.9

For the purposes of this Clause 4, the Valuers and the Independent Valuers shall not be bound in their determinations by the Floor Price; provided , however , that if the I/SP Enterprise Value as determined in accordance with this Clause 4 is below the Floor Price, then the I/SP Enterprise Value shall be deemed to be equal to the Floor Price and such deemed I/SP Enterprise Value shall be used to calculate the final I/SP Value.

4.2

Method of determining the I/SP Contribution Value and the Merial Contribution Value

4.2.1

Upon occurrence of the Satisfaction Date, the Parties shall identify the Contribution Reference Date.

4.2.2

Within five Business Days of the Satisfaction Date, Schering-Plough shall provide to Sanofi-Aventis a certificate setting forth the I/SP Contribution Value together with a detailing of the forecasts, calculations, bases and assumptions relating thereto. The certificate shall contain a statement from Schering-Plough confirming that it has been prepared in good faith based on the information available at the time it was prepared and in compliance with the terms of this Agreement.

4.2.3

Within five Business Days of the Satisfaction Date, Sanofi-Aventis shall provide to Schering-Plough a certificate setting forth the Merial Contribution Value together with a detailing of the forecasts, calculations, bases and assumptions relating thereto. The certificate shall contain a statement from Sanofi-Aventis confirming that it has been prepared in good faith based on the information available at the time it was prepared and in compliance with the terms of this Agreement.

4.3

Method of Determining the I/SP Value and the Merial Value, the I/SP Adjustment Amount and the Merial Adjustment Amount

4.3.1

Preparation of the Closing Accounts

(i)

Schering-Plough and Sanofi-Aventis shall cause, respectively, the I/SP Entities and Merial to each prepare, under their respective responsibility, and in close cooperation with their respective independent accountants, and shall deliver to each other within 90 days following the Closing, the I/SP Closing Accounts and the Merial Closing Accounts (and in each case the related statements of their independent auditors) together with the resulting amount of (a) the I/SP Value together with a detailing of the forecasts, calculations, bases and assumptions relating thereto, (b) the Merial Value together with a detailing of the forecasts, calculations, bases and assumptions relating thereto, (c) the I/SP Adjustment Amount (such amount as notified being referred to as the “ Notified I/SP Adjustment Amount ”) and (d) the Merial Adjustment Amount (such amount as notified being referred to as the “ Notified Merial Adjustment Amount ”). Each of Schering-Plough and Sanofi-Aventis shall provide (and shall cause Merial and its Subsidiaries and the I/SP Entities to provide) all reasonable access to the books and records, any other information, including working papers of their respective independent accountants, and to any employees of Merial and its Subsidiaries and the I/SP Entities to the extent necessary for either Party and its auditors to prepare the Closing Financial Documents.

(ii)

Subject to Exhibit B , the items on the I/SP Closing Accounts and the Merial Closing Accounts will be calculated as of the Closing Date and according to US GAAP consistent with past practice.

4.3.2

Review of the Closing Financial Documents

(i)

Each of Schering-Plough and Sanofi-Aventis shall complete their review within 45 days after delivery by the other of the relevant Closing Financial Documents. Each of Schering-Plough and Sanofi-Aventis shall provide (and shall cause Merial and its Subsidiaries and the I/SP Entities to provide) to the other Party and its accountants all reasonable access to the books and records, any other information, including working papers of its auditors, and to any employees of Merial and its Subsidiaries and the I/SP Entities to the extent necessary for each of Schering-Plough and Sanofi-Aventis and their respective auditors to exercise their review of the relevant Closing Financial Documents and necessary to equally participate in any discussion with each other.

(ii)

In the event that either Schering-Plough has objections to the Notified Merial Adjustment Amount and/or Sanofi-Aventis has objections to the Notified I/SP Adjustment Amount, they shall inform the other Party in writing (respectively a “ SP Objection ” or a “ SA Objection ”), setting forth a specific description of the basis and justification of the SP Objection or SA Objection, as applicable, and the proposed changes to, respectively, the Notified Merial Adjustment Amount or the Notified I/SP Adjustment Amount.

(iii)

For the avoidance of doubt, no objection may be made in respect of the I/SP Enterprise Value or the Merial Enterprise Value.

4.3.3

Response to Objection

4.3.4

Expert Review

4.3.5

Determination of Final I/SP Adjustment Amount and Final Merial Adjustment Amount

4.4

Final Closing Adjustment

4.4.1

If the Final I/SP Adjustment Amount is greater than the Final Merial Adjustment Amount, then Sanofi-Aventis will pay to Schering-Plough an amount equal to 50% of the absolute amount of the difference between the Final I/SP Adjustment Amount and the Final Merial Adjustment Amount.

4.4.2

If the Final Merial Adjustment Amount is greater than the Final I/SP Adjustment Amount, then Schering-Plough will pay to Sanofi-Aventis an amount equal to 50% of the absolute amount of the difference between the Final Merial Adjustment Amount and the Final I/SP Adjustment Amount.

4.4.3

For the avoidance of doubt, the Parties agree that the I/SP Enterprise Value and the Merial Enterprise Value shall be calculated pursuant to Clause 4.1 and Exhibit B without regard to the adjustments thereto pursuant to Clause 4.2 and Clause 4.3.

4.5

Merial Material Adverse Change

4.5.1

If between the SPA Closing Date and the completion date of the Merger, Merck becomes aware of an event, change or circumstance arising after the SPA Closing Date that it believes constitutes a Merial MAC, Merck shall notify Sanofi-Aventis of such event, change or circumstance in writing as promptly as reasonably practicable (the “ MAC Occurrence Notice” ), but in any event prior to the completion date of the Merger. The MAC Occurrence Notice shall contain in reasonable detail the basis for the belief that a Merial MAC has occurred and, if possible, a good faith estimate of the Other MAC Amount (defined below). If Sanofi-Aventis disagrees with Merck’s determination that a Merial MAC has occurred after the SPA Closing Date, Sanofi-Aventis shall notify Merck in writing within ten Business Days of its receipt of the MAC Occurrence Notice that it disagrees that a Merial MAC has occurred (the “ MAC Dispute Notice ”).  During the thirty-day period following Merck’s receipt of the MAC Dispute Notice (the “ MAC Occurrence Negotiation Period ”), the Parties agree to negotiate in good faith to resolve the disagreement.  Any resolution agreed to in writing by Sanofi-Aventis and Merck during the MAC Occurrence Negotiation Period shall be final and binding upon the Parties.  If Sanofi-Aventis and Merck are unable to resolve the disagreement within the MAC Occurrence Negotiation Period, then the dispute shall be settled by arbitration, to be held in the Borough of Manhattan, New York, New York, administered by the American Arbitration Association under its Procedures for Large, Complex Commercial Disputes (the “ AAA Complex Commercial Rules ”) and judgment on the award rendered by the MAC Arbitrators may be entered in any court having jurisdiction thereof. In any such arbitration, the parties shall appoint a panel of three individuals each of whom is suitably qualified and experienced in determining disagreements of this nature (the “ MAC Arbitrators ”) within fifteen days of the end of the MAC Occurrence Negotiation Period to resolve the disagreement and make a final determination as to whether a Merial MAC has occurred after the SPA Closing Date.  If Sanofi-Aventis and Merck are unable to agree upon the individuals to be appointed as MAC Arbitrators within such fifteen day time period, then the MAC Arbitrators shall be designated by the American Arbitration Association in New York, New York, United States. The MAC Arbitrators shall deliver to Sanofi-Aventis and Merck, as promptly as practicable and in any event within thirty days after their appointment, a written report setting forth their final determination, as determined by at least a majority of the MAC Arbitrators and in accordance with the AAA Complex Commercial Rules, as to whether a Merial MAC has occurred after the SPA Closing Date.  Such determination shall be final and binding upon all of the Parties to this Agreement.

4.5.2

If Sanofi-Aventis does not deliver to Merck a MAC Dispute Notice within ten Business Days of Sanofi-Aventis’ receipt of a MAC Occurrence Notice, or if a final determination is made pursuant to the procedures set forth in Clause 4.5.1 hereof that a Merial MAC has occurred after the SPA Closing Date, Sanofi-Aventis and Merck and Schering Plough shall work together in good faith in order to determine the monetary amount by which the Merial MAC that occurred after the SPA Closing Date decreased the Merial Enterprise Value (the “ Other MAC Amount ”).

4.5.3

The Other MAC Amount shall be calculated by the Parties or the MAC Valuer (defined below) based upon a discounted cash flow methodology as commonly applied in financial valuations.

4.5.4

In the event that Sanofi-Aventis and Merck and Schering Plough are unable to agree on the value of the Other MAC Amount pursuant to Clause 4.5.2 within thirty Business Days (the “ MAC Amount Negotiation Period ”), then the Parties shall appoint within fifteen days of the end of the MAC Amount Negotiation Period an investment bank of national standing (the “ MAC Valuer ”) agreed to by Sanofi-Aventis and Merck.  If Sanofi-Aventis and Merck are unable to agree upon the MAC Valuer within such fifteen-day time period, then the MAC Valuer shall be an investment bank of national standing that does not act as a consultant or otherwise provide services to Sanofi-Aventis, Schering-Plough or Merck designated by the American Arbitration Association in New York, New York, United States.  Both of Sanofi-Aventis and Merck shall provide the MAC Valuer with a reasonably detailed description of each item of the calculation of the Other MAC Amount about which the Parties are in disagreement (each a “ MAC Amount Dispute Item ”).  The MAC Valuer shall only consider those MAC Amount Dispute Items not resolved between Sanofi-Aventis and Merck during the MAC Amount Negotiation Period and shall be instructed to resolve such MAC Amount Dispute Items in accordance with the terms and provisions of this Agreement.  The MAC Valuer shall deliver to Sanofi-Aventis and Merck, as promptly as practicable and in any event within thirty days after its appointment, a written report setting forth the resolutions of any unresolved MAC Amount Dispute Items determined in accordance with the terms herein and a final determination as to the Other MAC Amount.  The MAC Valuer shall select as a resolution the position of either Sanofi-Aventis or Merck for each MAC Amount Dispute Item (based solely on presentations and supporting material provided by the Parties and not pursuant to any independent review) and may not impose an alternative resolution.  Such report shall be final and binding upon all of the Parties to this Agreement.

4.5.5

The fees, expenses and costs of the MAC Arbitrators and of the MAC Valuer shall be borne equally by Sanofi-Aventis and Merck.

4.5.6

The Other MAC Amount shall only be taken into account in order to determine the Merial Enterprise Value in accordance with the provisions of Exhibit B .

4.5.7

Sanofi-Aventis undertakes to promptly inform Merck if, to the Knowledge of Sanofi-Aventis, any event, change or circumstance which would be reasonably likely to constitute a Merial MAC occurs after the SPA Closing Date and prior to the completion date of the Merger.

5.1

As of the date hereof and as of the Closing Date, each Party represents to the other Parties as follows:

5.1.1

5.1.2

Corporate authorization

The execution, delivery and performance by the Party of this Agreement has been duly and validly authorized by the relevant corporate bodies of the Party.

5.1.3

Enforceability

This Agreement has been duly and validly executed and delivered by the Party and, assuming the due and valid execution and delivery by the other Parties, constitutes a legal, valid and binding obligation of the Party enforceable against the Party in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, moratorium, reorganization or similar laws affecting the enforcement of creditors’ rights generally.

5.1.4

No contravention

The execution, delivery and performance by the Party of this Agreement and the consummation by the Party of the transactions contemplated hereby do not and will not (i) contravene or conflict with the organizational or governing documents of the Party or (ii) conflict with or constitute a violation of any provision of any material law binding upon or applicable to the Party or any of its properties or assets.

5.1.5

Consents and approvals

Except for any required filings and or notices required by the Merger Control Authorities, no consent, approval, waiver or authorization is required to be obtained by the Party from, and no notice or filing is required to be given by the Party to, or made by the Party with, any governmental entity, regulatory authority or court in connection with the execution, delivery and performance by the Party of this Agreement, other than in all cases where the failure to obtain such consent, approval, waiver or authorization, or to give or make such notice or filing, individually or in the aggregate, have not and will not materially impair or delay the ability of the Party to perform its obligations under this Agreement.

5.1.6

No Brokers

No broker, investment banker, financial advisor or other Person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission in connection with the transactions contemplated by this Agreement, other than, with respect to Merck and Schering-Plough, Credit Suisse (the fees and expenses of which shall not be incurred or suffered by Sanofi-Aventis or any of its Affiliates or any of the I/SP Entities) and, with respect to Sanofi-Aventis, Evercore Partners (the fees and expenses of which shall be paid by Sanofi-Aventis). No engagement letters obligate Merial and its Subsidiaries or any of the I/SP Entities to continue to use their services or pay fees or expenses in connection with any future transaction.

6

Closing

6.1

Upon exercise of the Call Right and satisfaction of the conditions precedent set out in the Contribution Agreement, the completion of the transfer (by way of purchase or contribution) of the I/SP Business to Merial pursuant to Clause 3.6 (the “ Closing ”) shall take place at the offices of Linklaters LLP, 1345 Avenue of the Americas, New York, New York at 10:00 a.m. on the date that is determined in accordance with the Contribution Agreement (the “ Closing Date ”). At the Closing:

6.1.1

Schering-Plough shall cause the shares of the I/SP Entities to be contributed, free and clear of any Encumbrances, to Merial as further described in the Contribution Agreement;

6.1.2

Sanofi-Aventis shall cause to be delivered by Merial to Schering-Plough, or any Affiliate that Schering-Plough may designate, newly issued Merial shares as set forth in Clause 3.6, free and clear of any Encumbrances in consideration of the contribution of the shares of the I/SP Entities and shall sell to (or caused to be sold to) or acquire (or cause to be acquired) from Schering-Plough, or any Affiliate that Schering-Plough may designate, (and Schering-Plough agrees to acquire from or sell to Sanofi-Aventis) for cash such number of Merial shares, which results in Schering-Plough owning in aggregate 50% of the share capital in Merial, all as further described in Clause 3.6 hereof;

6.1.3

Sanofi-Aventis and Schering-Plough shall, and Sanofi-Aventis shall cause Merial to, execute and deliver the Shareholders’ Agreement;

6.1.4

Sanofi-Aventis, Merial and Schering-Plough shall each deliver all other instruments, agreements, certificates and documents required to be delivered by such Party on or prior to the Closing Date pursuant to this Agreement or the Contribution Agreement; and

6.1.5

Sanofi-Aventis or any of its Affiliates shall pay the sum of US$750,000,000, as additional consideration, by wire transfer of immediately available funds to one or more accounts designated by Schering-Plough or any of its Affiliates at least three (3) Business Days prior to the Closing Date.

7

Covenants of the Parties

7.1

Covenants of Sanofi-Aventis and Merial

7.1.1

From the SPA Closing Date until the earlier of the execution of the Contribution Agreement or the termination of this Agreement in accordance with its terms, Sanofi-Aventis shall cause Merial to (i) conduct the Merial Business in the Ordinary Course, (ii) use its commercially reasonable efforts to preserve intact the Merial Business, including the assets and the relationships of Merial with its customers and suppliers and others having business dealings with it, (iii) use its commercially reasonable efforts to keep available the services of the present officers and significant employees of Merial, (iv) maintain the books and records of Merial in the ordinary manner, (v) use its commercially reasonable efforts to preserve the goodwill and ongoing operations of Merial, (vi) not issue, sell, transfer, split, combine or reclassify any equity securities of Merial, and (vii) not adopt a plan or agreement of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization.

7.1.2

From the SPA Closing Date until the earlier of the execution of the Contribution Agreement or the termination of this Agreement in accordance with its terms, Sanofi-Aventis shall cause Merial to not pay (i) any dividend (including interim dividends or other similar forms of distribution), other than dividends or distributions that would be reflected in the calculation of the Merial Value pursuant to Clause 4.3, or (ii) effect any redemption of shares or otherwise effect a return of share capital.

7.1.3

From the SPA Closing Date until the earlier of the execution of the Contribution Agreement or the termination of this Agreement in accordance with its terms, Sanofi-Aventis and its Affiliates shall (i) maintain Merial principally as a stand-alone entity, provided that Sanofi-Aventis may cause Merial and its Subsidiaries to enter into customary agreements and intercompany arrangements for items such as cash management, tax sharing, data sharing and other similar ordinary course purposes and (ii) not otherwise enter into new agreements, or modify any existing agreements, between Sanofi-Aventis or its Affiliates, on the one hand, and Merial or its Subsidiaries, on the other hand, that would continue to be effective following the Closing unless such agreements are substantially on an arm’s-length basis.

7.1.4

Following the Closing, Sanofi-Aventis shall, and shall cause its respective Affiliates, from time to time, to, execute and deliver such additional instruments, documents, conveyances or assurances and take such other actions as shall be necessary, or otherwise reasonably requested by Schering-Plough, to confirm and assure the rights and obligations provided for in this Agreement and render effective the consummation of the transactions contemplated hereby.

7.1.5

From the SPA Closing Date, until the earlier of the execution of the Contribution Agreement or termination of this Agreement in accordance with its terms, Sanofi-Aventis undertakes (i) not to sell, transfer, donate, grant any option over or otherwise dispose of or permit the sale or the transfer of Merial or any of its Subsidiaries or all or substantially all of the rights, title, interests in and to the properties, assets and rights owned by Merial or any of its Subsidiaries to a third party, and (ii) without limiting Sanofi-Aventis’ rights hereunder, not to take any other action which is inconsistent with the provisions of this Agreement or the Contribution Agreement.

7.1.6

The provisions of this Agreement shall not prohibit the conversion of the preference shares currently issued by Merial into ordinary shares of Merial after the SPA Closing Date.

7.1.7

No later than ninety (90) days after the SPA Closing Date, Sanofi-Aventis shall deliver to Merck a proposed SPA Closing Date Balance Sheet.  Merck will have thirty (30) days following receipt thereof to review the proposed SPA Closing Date Balance Sheet.  If Merck objects in writing to all or part of the proposed SPA Closing Date Balance Sheet within such thirty (30) day period, the Parties will use their commercially reasonable efforts to resolve all such disputes.  If the Parties are unable to resolve all of their disagreements with respect to the proposed SPA Closing Date Balance Sheet within twenty (20) days, the Parties will refer their remaining differences to the Expert pursuant to the procedures set forth in Clauses 4.3.3 and 4.3.4.  The final SPA Closing Date Balance Sheet shall be the proposed SPA Closing Date Balance Sheet delivered to Merck by Sanofi-Aventis together with any revision thereto agreed between the Parties or resolved by the Expert pursuant to this Clause 7.1.7.

7.2

Covenants of Merck and Schering-Plough

7.2.1

From the date of closing of the Merger until the earlier of the execution of the Contribution Agreement or the termination of this Agreement in accordance with its terms, Schering-Plough shall cause the I/SP Entities to (i) conduct the I/SP Business in the Ordinary Course, (ii) use their commercially reasonable efforts to preserve intact the I/SP Business, including the assets and the relationships of the I/SP Entities with their respective customers and suppliers and others having business dealings with them, (iii) use their commercially reasonable efforts to keep available the services of the present officers and significant employees of the I/SP Business, (iv) use their commercially reasonable efforts to maintain the books and records of the I/SP Entities in the ordinary manner, (v) use their commercially reasonable efforts to preserve the goodwill and ongoing operations of the I/SP Entities and (vi) not adopt a plan or agreement of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization which would restrict the ability to complete the transactions contemplated by this Agreement or the Contribution Agreement upon the terms defined herein and therein.

7.2.2

From the Valuation Date until the earlier of the execution of the Contribution Agreement or the termination of this Agreement in accordance with its terms, Schering-Plough shall cause the I/SP Entities to not (i) pay any dividend (including interim dividends or other similar forms of distribution), other than dividends or distributions that would be reflected in the calculation of the I/SP Value pursuant to Clause 4.3 and Exhibit B or (ii) effect any redemption of shares or otherwise effect a return of share capital.

7.2.3

Following the Closing, Schering-Plough shall, and shall cause its Affiliates, from time to time, to execute and deliver such additional instruments, documents, conveyances or assurances and take such other actions as shall be necessary, or otherwise reasonably requested by Sanofi-Aventis, to confirm and assure the rights and obligations provided for in this Agreement and render effective the consummation of the transactions contemplated hereby.

7.2.4

From the date of this Agreement until the earlier of the execution of the Contribution Agreement or the termination of this Agreement in accordance with its terms, Schering-Plough and its Affiliates shall (i) maintain the I/SP Business principally as a stand-alone entity to the same extent as they were stand-alone entities prior to the date hereof, provided that Schering-Plough may cause I/SP and its Subsidiaries to enter into customary agreements and intercompany arrangements for items such as cash management, tax sharing, data sharing, human resources and other similar ordinary course purposes and (ii) not otherwise enter into new agreements, or modify any existing agreements, between Schering-Plough or its Affiliates, on the one hand, and I/SP or its Subsidiaries, on the other hand, that would continue to be effective following the Closing unless such agreements are substantially on an arm’s-length basis.

7.2.5

From the date of this Agreement until the earlier of the execution of the Contribution Agreement or termination of this Agreement in accordance with its terms, Merck and Schering-Plough undertake (i) to cease and not to solicit, initiate, engage or participate, directly or indirectly, in any discussions or negotiations with any other Person regarding the transactions contemplated by this Agreement or the Contribution Agreement, (ii) not to sell, transfer, donate, grant any option over or otherwise dispose of or permit the sale or the transfer of the I/SP Entities or all or substantially all of the rights, title, interests in and to the properties, assets and rights owned by the I/SP Entities to a third party, and (iii) without limiting Schering-Plough’s rights hereunder, not to take any other action which is inconsistent with the provisions of this Agreement or the Contribution Agreement.  Nothing in this Clause 7.2.5 shall prohibit or limit in any way Schering-Plough from taking any actions permitted under Section 6.4 (No Solicitation) of the Merger Agreement as in effect on the date hereof.

7.2.6

Merck and Schering-Plough shall not make any filing under Competition Laws for approval of the Merger by the European Commission until the earlier of (i) September 17, 2009 and (ii) the SPA Closing Date (the “ Earliest EC Filing Date ”). Merck and Schering-Plough undertake to provide Sanofi-Aventis with a full copy of the clearance decision of the European Commission in respect of the Merger (save for business confidential information) within two Business Days of the receipt of such decision by Merck or Schering-Plough.  For the avoidance of doubt, nothing in this Agreement shall prohibit Merck and Schering-Plough from making any such filing on or after the Earliest EC Filing Date.

7.2.7

From the SPA Closing Date until the earlier of (i) the Closing Date or (ii) the later of (a) termination of this Agreement in accordance with its terms and (b) the date of the completion of the Merger, if Merck (or any of its Affiliates), or, after the completion of the Merger, Schering-Plough (or any of its Affiliates), purchases, merges with or otherwise acquires, directly or indirectly, any Third Party that has Merial Venture Business operation (as defined in the Master Agreement) then such Third Party will be deemed to be an Acquired Entity under Clause 15.1(d) of the Master Agreement and the provisions of such Clause shall be applicable to such purchase, merger or acquisition.

7.3

Covenants of Each Party

7.3.1

In the event the Call Right is exercised, each of the Parties shall use its commercially reasonable efforts to take or cause to be taken, all actions and to do, or cause to be done all things, necessary, proper or advisable to consummate the transactions contemplated hereby by the Closing Date.

7.3.2

In the event the Call Right is exercised, in furtherance and not in limitation of the foregoing, from and after the date the Call Right is exercised, each Party shall use its commercially reasonable efforts to take any and all steps necessary to avoid or eliminate impediments or objections, if any, that may be asserted with respect to the transactions contemplated by this Agreement under any Competition Laws so as to enable the Parties hereto to close the transactions as promptly as practicable, including (i) proposing, negotiating, committing to and effecting, by consent decree, hold separate orders or otherwise, the sale, divesture or disposition of any assets, properties or businesses of Merial and its Subsidiaries or the I/SP Business and (ii) otherwise taking or committing to take actions that after the Closing Date would limit Merial’s, Sanofi-Aventis’, I/SP Business’, Schering-Plough’s or Merck’s freedom of action with respect to, or their ability to retain, one or more of the businesses, product lines or assets of Merial or its Subsidiaries or of the I/SP Business, in each case as may be required in order to avoid the entry of, or to effect the dissolution of, any injunction, temporary restraining order, or other order in any suit or proceeding, which would otherwise have the effect of preventing or materially delaying the Closing (a “ Regulatory Divestiture ”); provided, however , that nothing in this Clause 7.3.2 or this Agreement shall require the Parties to effect a Regulatory Divestiture of assets or businesses of Merial and its Subsidiaries and of the I/SP Business that in the aggregate, generated more than 20% of the combined sales of Merial and its Subsidiaries and the I/SP Business during the 12 calendar months prior to the Valuation Date (the “ Threshold ”).  To the extent applicable, each of the Parties shall use its commercially reasonable efforts to in good faith identify and mutually agree upon which assets or businesses of Merial and its Subsidiaries, and/or the I/SP Business would be most economically advantageous to be subject to Regulatory Divestiture in light of the transactions contemplated by the Call Right.

7.3.3

In the event that any Regulatory Divestiture is required by a Merger Control Authority to be completed prior to the Closing, the Party conducting such Regulatory Divestiture shall ensure that any after tax cash proceeds or other consideration received in connection with such Regulatory Divestiture are retained in the I/SP Entities or Merial and its Subsidiaries, as applicable, and the relevant valuation for I/SP or Merial, as the case may be, shall not be adjusted pursuant to Exhibit B as a result of such Regulatory Divestiture or such after-tax cash proceeds or other consideration.

7.3.4

The Parties agree that (i) as of the date hereof, no withholding (including, without limitation, under Section 1445(e) of the Internal Revenue Code and Section 1.1445-11T of the Treasury Regulations) is required under current law with respect to the transactions contemplated by this Agreement and (ii) all payments and deliveries required with respect to the transactions contemplated by this Agreement shall be made free and clear of, and without withholding or deduction of, any Taxes, unless withholding or deduction of such Taxes is required by reason of a change in law occurring after the date hereof.

7.4

Right of First Refusal

7.4.1

If (i) Merck shall have terminated this Agreement pursuant to Clause 9.1.3 below, (ii) Sanofi-Aventis has acquired the Shares (as such term is defined in the Share Purchase Agreement) under the Share Purchase Agreement, and (iii) the Merger shall have occurred, the Parties agree that if, during the ROFR Period, Schering-Plough receives a bona fide written offer (the “ Offer ”) from a Third Party to purchase, directly or indirectly, in any manner, all, or a significant portion of, the I/SP Business or a controlling ownership of any class of equity securities of all or a significant portion of the I/SP Entities, Schering-Plough shall not accept such Offer unless it has first provided Sanofi-Aventis the opportunity to acquire all or such portion of the I/SP Business or such securities, as the case may be, on the same price, information access and terms as offered by or provided to the Third Party (the “ Matching Opportunity ”), in accordance with the procedures set forth in Clause 7.4.3.  For the avoidance of doubt, the Matching Opportunity shall be available to Sanofi-Aventis with respect to any bona fide offer made by a Third Party during the ROFR Period up to and until the date upon which such Offer is irrevocably withdrawn by such Third Party or rejected by Schering-Plough even if that withdrawal or rejection occurs following the end of the ROFR period. The Matching Opportunity shall not be available unless Schering-Plough determines to accept such bona fide Offer.

7.4.2

The Parties agree that if (i) Merck shall have terminated this Agreement pursuant to Clause 9.1.3 below, (ii) Sanofi-Aventis has acquired the Shares (as such term is defined in the Share Purchase Agreement) under the Share Purchase Agreement and (iii) the Merger shall have occurred and, during the ROFR Period, Schering-Plough conducts a Third Party sale process or enters into any discussions with a Third Party for the sale of I/SP Business, Schering-Plough shall allow Sanofi-Aventis to participate in the sale process/discussions on the same terms as the other participants.  For the avoidance of doubt, Sanofi-Aventis shall be permitted to participate in such sale process/discussions up to and until the point in time at which such process/discussions are terminated with all Third Parties. The provisions of this Clause 7.4.2 are without prejudice to the rights of Sanofi-Aventis under Clause 7.4.1.

7.4.3

In the case of an Offer that Schering-Plough desires to accept, Schering-Plough shall provide Sanofi-Aventis with a notice (the “ Offer Notice ”) of the Offer, including (i) the principal terms and conditions of the Offer ( e.g. , price and proposed date of sale) and (ii) an irrevocable offer (the “ Sale Offer ”) by Schering-Plough to sell the I/SP Business at the price offered by the Third Party to Sanofi-Aventis, such price to be payable on terms and conditions no less favorable than those provided by the Third Party (save for any merger control approvals or other required regulatory approvals that would be required if Sanofi-Aventis accepts the Sale Offer).

Subject to entering into a customary confidentiality agreement (which, if terms cannot be agreed within three (3) calendar days, shall be on substantially the same terms as the Third Party making the Offer), Schering-Plough shall, at the same time as the Offer Notice, grant Sanofi-Aventis access to all information provided to the Third Party in respect of the I/SP Business or the subject matter of the Offer for the same period of time the Third Party had access to such information.

In the event the price offered by the Third Party is not entirely in cash (such as in the case of a merger or contribution in-kind), Schering-Plough shall, together with the Offer Notice, provide Sanofi-Aventis with a good faith valuation in cash of the consideration offered by the Third Party. Absent an agreement between Sanofi-Aventis and Schering-Plough within 20 calendar days of the Offer Notice on such valuation, Sanofi-Aventis and Schering-Plough shall appoint an independent investment bank to be agreed upon by Sanofi-Aventis and Schering-Plough to act as an independent valuer in order to determine the valuation in cash of the consideration offered by the Third Party, in which case the provisions of Clauses 4.1.6 and 4.1.7 shall apply mutatis mutandis and such independent valuer shall use its best efforts to provide Sanofi-Aventis and Schering-Plough with a valuation within 30 calendar days of its appointment. The independent valuer appointed pursuant to this Clause 7.4.3 shall make the determination of the cash value with reference to criteria that such independent valuer deems appropriate.

7.4.4

If Sanofi-Aventis does not accept the Sale Offer from Schering-Plough with respect to the I/SP Business during the 30-calendar day period (subject to the applicable suspensions of that period as provided in Clause 7.4.3) for which a Sale Offer shall remain open, Schering-Plough may sell the I/SP Business to the Third Party that made the Offer at any time following the expiration of such 30-day period; provided that any sale pursuant to the Offer shall be made on terms no more favorable in the aggregate to the Third Party making the Offer than the terms contained in the Sale Offer.

7.5

Cooperation

7.5.1

The Parties agree to cooperate, together with their outside counsels, in order to (i) identify those jurisdictions in which filings with Merger Control Authorities need to or should be made, (ii) to provide information relevant in that respect and (iii) if applicable, identify and mutually agree upon, in accordance with Clause 7.3.2, the assets or businesses of Merial or its Subsidiaries or the I/SP Business that may be subject to a Regulatory Divestiture.

7.5.2

Each Party shall use its commercially reasonable efforts to cooperate and to the extent practicable consult with each other in order to (x) comply promptly with all legal requirements which may be imposed on one of them with respect to this Agreement and the transactions contemplated hereby (which actions shall include furnishing all information required by applicable law in connection with approvals of or filings with any Governmental Authority or Merger Control Authority) and (y) take any reasonable action reasonably necessary to vigorously defend, lift, mitigate, or rescind the effect of any litigation or administrative proceeding adversely affecting the transactions contemplated by this Agreement, or the Contribution Agreement, including promptly appealing any adverse court or administrative decision. The Parties shall keep each other informed of any information and documents requested by any Merger Control Authority in respect of the transaction contemplated herein.

7.5.3

Nothing contained in this Clause 7.5 shall be construed as requiring the Parties to submit to or proffer to any terms or conditions as a condition to, or in connection with, making any filings with Merger Control Authorities, that would require Regulatory Divestitures in excess of the Threshold.

8

(Intentionally Omitted)

9

Termination

9.1

Termination

9.1.1

prior to the consummation of the Merger, by the written agreement of Sanofi-Aventis and Merck (provided that prior to the consummation of the Merger Schering-Plough shall have consented to any action by Merck pursuant to this Clause 9.1.1);

9.1.2

(Intentionally omitted);

9.1.3

prior to the consummation of the Merger, by Merck, (i) on or after September 30, 2009 if the FTC staff has not, by September 30, 2009, recommended to the FTC a proposed Decision and Order for the Merger that does not prohibit nor render impossible the consummation of the transactions contemplated by this Agreement and the Contribution Agreement or (ii) at any time following November 6, 2009 until the completion of the Merger, for any reason (the payment of the Termination Fee being a precondition to the effectiveness of any termination under this Clause 9.1.3 occurring after the SPA Closing Date);

9.1.4

by Sanofi-Aventis if the competition clearance decision of the European Commission with respect to the Merger would have the effect of prohibiting or rendering the consummation of the Call Right and/or the provisions of the Contribution Agreement impossible within two (2) years from the date of such decision;

9.1.5

by Merck (provided that prior to the consummation of the Merger Schering-Plough shall have consented to any action by Merck pursuant to this Clause 9.1.5), in the event a Merial MAC occurs between the completion of the Merger and the earlier of the exercise of the Call Right and the Expiration Date;

9.1.6

by Sanofi-Aventis in its sole discretion at any time before the exercise of the Call Right and thereafter upon termination of the Contribution Agreement;

9.1.7

by any Party, by written notice to the other Party if the Share Purchase Agreement shall have been terminated pursuant to its terms; and

9.1.8

by Merck (provided that prior to the consummation of the Merger Schering-Plough shall have consented to any action by Merck pursuant to this Clause 9.1.8) in its sole discretion at any time (x) after 5:00 p.m. New York City time on the Expiration Date if Sanofi-Aventis has not exercised the Call Right prior to such date or (y) after termination of the Contribution Agreement.

9.1.9

by Merck or Schering-Plough, if the Merger Agreement is terminated (the payment of the Termination Fee being a precondition to the effectiveness of any termination under this Clause 9.1.9 occurring after the SPA Closing Date).

9.2

Effect of Termination

10

Confidentiality and Announcements

10.1

Announcements

10.2

Confidentiality

10.2.1

The Parties hereby agree that any information they receive from or on behalf of any other Party or any Affiliate of any other Party, which receipt arises out of the transactions contemplated by this Agreement (the “ Confidential Information ”) shall: (a) be used solely for the purpose of performing the transactions contemplated by this Agreement; (b) not be used directly or indirectly in any way that is for competitive purposes; and (c) be kept confidential by such Party and its Representatives and be used only for the purposes of this Agreement; provided, however, that any such Confidential Information may be disclosed only to their Representatives who (a) need to know such Confidential Information and (b) are not involved in the management or operations of the I/SP Business or Merial, as applicable.  It is understood that such Representatives shall be informed by the applicable Party of the confidential nature of such Confidential Information, and that each Party shall be responsible for any disclosure or use made by their Representatives in breach of obligations under this Agreement to the same extent as if such disclosure or use had been made directly by such Party. The obligations of confidentiality and non-use set forth in this Agreement shall expire five years after the date of this Agreement.

10.2.2

Each Party will as soon as practicable notify each other Party of any breach of this Agreement of which they become aware, and will use commercially reasonable efforts to assist and cooperate with each other Party in minimizing the consequences of such breach. If a Party or any of their Representatives are legally required or requested to disclose any Confidential Information, they will, unless otherwise prohibited by law or regulation, promptly notify each other Party of such request or requirement so that each such other Party may seek to avoid or minimize the required disclosure and/or obtain an appropriate protective order or other appropriate relief to ensure that any Confidential Information so disclosed is maintained in confidence to the maximum extent possible by the person receiving the disclosure, or, in each such other Party’s discretion, to waive compliance with the provisions of this Agreement. In any such case, the Parties agree to cooperate and use reasonable efforts to avoid or minimize the required disclosure and/or obtain such protective order or other relief. If, in the absence of a protective order or the receipt of a waiver hereunder, any Party or its Representatives is legally obligated to disclose any Confidential Information, they will disclose only so much thereof to the Party compelling disclosure as they believe in good faith, on the basis of advice of counsel, is required by law. Each Party shall give each other Party prior written notice of the specific Confidential Information that they believe they are required to disclose under such circumstances.

10.2.3

All Confidential Information disclosed by or on behalf of any Party or any of its Affiliates shall be, and shall remain, the property of such Party or such Affiliate. At any time at the written request of the disclosing Party, the receiving Party shall destroy all originals and copies of all Confidential Information and shall not retain any copies, extracts or other reproductions in whole or in part of such Confidential Information.  Such destruction shall be confirmed in writing to the disclosing Party by an authorized representative of such Party.  Notwithstanding the foregoing, each Party and their external law firms may each retain a copy of any Confidential Information and all corresponding material and related documentation pertaining thereto to the extent retention is required by their regulatory, compliance or internal record retention policies, by law or regulation or in connection with any legal proceeding. Any Confidential Information that is not destroyed, including all oral Confidential Information, shall remain subject to the confidentiality and non-use obligations set forth in this Agreement.

11

Miscellaneous

11.1

Fees and Expenses

11.1.1

Except as otherwise provided in this Agreement, Merck and Schering-Plough, on the one hand, and Sanofi-Aventis and Merial, on the other hand, shall bear their respective expenses, costs and fees in connection with the transactions contemplated hereby, including the preparation, execution and delivery of this Agreement and compliance herewith, whether or not the transactions contemplated hereby shall be consummated.

11.1.2

In the event that (i) after the SPA Closing (x) Merck terminates this Agreement pursuant to Clauses 9.1.3 or 9.1.9 or (y) the Merger Agreement is terminated prior to the consummation of the Merger or the board of directors of Merck or Schering-Plough has resolved not to consummate the Merger, Merck shall pay or cause to be paid $400,000,000 (the “ Termination Fee ”) to Sanofi-Aventis, within three (3) Business Days after such termination, by wire transfer of immediately available funds to an account designated by Sanofi-Aventis, or (ii) Merck terminates this Agreement pursuant to Clauses 9.1.3 or 9.1.9 (or the Merger Agreement is terminated prior to the consummation of the Merger or the board of directors of Merck or Schering-Plough has resolved not to consummate the Merger and Merck has not terminated this Agreement pursuant to Clause 9.1.9) prior to the SPA Closing Date but the SPA Closing Date subsequently occurs, Merck shall pay or cause to be paid the Termination Fee to Sanofi-Aventis, within three (3) business days after the SPA Closing Date, by wire transfer of immediately available funds to an account designated by Sanofi-Aventis; provided , however , that if (i) Merck pays the Termination Fee to Sanofi-Aventis pursuant to this Clause 11.1.2, (ii) the Merger shall have been consummated, and (iii) during the eighteen month period following the date of such payment Schering-Plough and Sanofi-Aventis enter into a joint venture, contribution, purchase or similar transaction as that contemplated by the Contribution Agreement, resulting in the combination of Merial with all of the I/SP Business in a joint venture between Sanofi-Aventis and Merck/Schering Plough and/or their respective Affiliates, Sanofi-Aventis shall, upon consummation of such joint venture, contribution, purchase or similar transaction, refund or reimburse the Termination Fee to Merck or such Affiliate of Merck that Merck may designate.

11.1.3

In the event that (i) Merck and Schering-Plough file their notification with the European Commission for competition clearance of the Merger (the “ EC Filing ”) on or prior to the SPA Closing Date, (ii) the European Commission takes a decision that approves the Merger but such decision has the effect of prohibiting the Parties from consummating, or rendering impossible the consummation of, the transactions contemplated by this Agreement and/or the Contribution Agreement within two (2) years from the date of such decision, (iii) the SPA Closing has occurred and (iv) the Merger has been consummated, then Merck shall pay or cause to be paid an amount of (x) $600,000,000 to Sanofi-Aventis in the event the Termination Fee has not yet become payable pursuant to Clause 11.1.2 or (y) $200,000,000 to Sanofi-Aventis, as an increase of the Termination Fee referred to in Clause 11.1.2, if the Termination Fee set forth in Clause 11.1.2 is then payable or has been previously paid by Merck to Sanofi-Aventis.  The payment specified in subclauses (x) and (y) of the preceding sentence shall be paid by wire transfer of immediately available funds to an account designated by Sanofi-Aventis within three Business Days after the latest to occur of the events described in subclauses (i) through (iv) above.

11.1.4

In the event that (i) Sanofi-Aventis has terminated this Agreement pursuant to Clause 9.1.4 and Merck has not terminated this Agreement in accordance with Clause 9.1.3 or 9.1.9, (ii) Merck and Schering-Plough file their EC Filing prior to the SPA Closing Date, (iii) the European Commission takes a decision that approves the Merger but such decision has the effect of prohibiting the Parties from consummating, or rendering impossible the consummation of, the transactions contemplated by this Agreement and/or the Contribution Agreement within two (2) years from the date of such decision, (iv) the SPA Closing has occurred and (v) the Merger has been consummated, Merck shall pay or cause to be paid an amount of $600,000,000 to Sanofi-Aventis.  The payment specified in the preceding sentence shall be paid by wire transfer of immediately available funds to an account designated by Sanofi-Aventis within three Business Days after the latest to occur of the events described in Clause (i) through (v) above in lieu of any payment that may become payable under Clauses 11.1.2 and 11.1.3.  Such payment shall be defined as a Termination Fee for the purpose of this Agreement.

11.1.5

Any Termination Fee payable pursuant to Clause 11 shall be treated as purchase price reduction under the Share Purchase Agreement.

11.1.6

The parties acknowledge and hereby agree that the covenants and agreements set forth in this Clause 11.1 are an integral part of the transactions contemplated by this Agreement, and that without these agreements, the parties would not have entered into this Agreement, and that any amounts payable pursuant to Clause 11 do not constitute a penalty.

11.1.7

Notwithstanding anything in this Agreement to the contrary, in no event shall Merck be obligated to pay to Sanofi-Aventis any amount in excess of $600,000,000 in the aggregate pursuant to this Clause 11.1.

11.2

Notices

11.2.1

Any notice or other communication in connection with this Agreement (each, a “ Notice ”) shall be:

(i)

in writing in English; and

(ii)

delivered by hand or by courier using an internationally recognized courier company.

11.2.2

A Notice to Sanofi-Aventis shall be sent to Sanofi-Aventis at the following address, or such other person or address as Sanofi-Aventis may notify to the Parties from time to time:

11.2.3

A Notice to Schering-Plough prior to consummation of the Merger shall be sent to Schering-Plough at the following address, or such other person or address as Schering-Plough may notify to the Parties from time to time:

11.2.4

A Notice to Merck (or to Schering-Plough following consummation of the Merger) shall be sent to Merck at the following address, or such other person or address as Merck may notify to the Parties from time to time:

11.2.5

A Notice shall be effective upon receipt and shall be deemed to have been received at the time of delivery, if delivered by hand, registered post or courier, provided that if a Notice would become effective after 5:30 p.m. on any Business Day, then it shall be deemed instead to become effective at 9:30 a.m. on the next Business Day. References in this Agreement to time are to local time at the location of the addressee as set out in the Notice.

11.3

Entire Agreement

11.4

Schedules

11.5

Amendment; Waivers

11.6

Severability

11.7

Counterparts

11.8

Binding Effect

11.9

Assignment

11.10

No Third Party Beneficiaries

11.11

Governing Law

11.12

Specific performance

11.13

Waiver of Jury Trial