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News Release

FOR IMMEDIATE RELEASE
May 16, 2005

Notice on Providing Stock Options in the Form of New Stock Issuance


Listed Stock Name:   Eisai Co., Ltd.
President & CEO: Mr. Haruo Naito
Headquarters: 4-6-10 Koishikawa Bunkyo-ku, Tokyo
Securities Code: 4523
Listed Locations: First Sections of the Tokyo Stock Exchange
& the Osaka Securities Exchange
Inquiries: Mr. Hiroyuki Mitsui
Vice President
Corporate Communications & General Affairs
Phone: +81-3-3817-5085

Notice on Providing Stock Options in the Form of New Stock Issuance

The Board of Directors of Eisai Co., Ltd. (hereinafter referred to as "Company") resolved at a meeting on May 16, 2005 to propose at the 93rd Ordinary General Meeting of Shareholders to be held on June 24, 2005 the issuance of subscription rights as stock options pursuant to Articles 280-20 and 280-21 of the Commercial Code.


I1 . Reason for issuing subscription rights under specifically advantageous terms to parties other than shareholders.

The subscription rights shall be issued to the Company's directors executive officers and other applicable persons as stock options in order to raise their morale and enhance motivation to promote the Company's corporate value.

II2 . Terms for Issuing Subscription Rights

(1) Types and Numbers of Shares to be Issued by the Exercise of Subscription Rights

Up to 290,000 common shares in the Company


(2) Number of Subscription Rights

Up to 2,900 subscription rights

The number of shares (hereinafter referred to as "Number of Granted Shares") to be Issued by the exercise of each share option shall be 100 shares. In the event that the Company's common shares are split or consolidated, the Number of Granted Shares shall be adjusted by the following formula, and any amount less than one sahre resulting from such adjustment shall be rounded up.

(3) Subscription rights Issuing price

The subscription rights shall be issued free of charge.

(4) Amount Paid in upon the Exercise of Subscription Rights
 

The amounts paid in upon the exercise of the subscription rights shall be equal to the amount paid in (hereinafter referred to as "Exercise Price") per share issued or transferred by the exercise of the respective subscription rights multiplied by the Number of Granted Shares.


The Exercise Price shall be equal to the greater of (a) the average closing price of the Company's common shares traded in regular transactions at the Tokyo Stock Exchange on the respective days in the previous month (excluding the days on which no transactions were performed), or (b) the closing price of the subscription rights issuing date (or the most recent closing price if there is no transaction on the subscription rights issuing date).


Furthermore, in the event that the Company's common shares are split or consolidated, the Exercise Price shall be adjusted according to the following formula, and any amount less than 1 yen resulting from such adjustment shall be rounded up.

 

Furthermore, regarding the Company's common shares, if the Company is to issue new shares or dispose of its treasury shares at an amount lower than the market price the Exercise Price shall be adjusted according to the following formula and any amount less than 1 yen resulting from such adjustment shall be rounded up. Provided, however, that the foregoing shall not apply to the exercise of subscription rights, the conversion of convertible bonds pursuant to the Commercial Code before the enforcement of the Law concerning Partial Amendment to the Commercial Code (Law No. 128/2001), or the exercise of warrants pursuant to Article 280-19 of said law.

In the above formula, "Number of previously issued shares" is the total number of shares issued by the Company excluding treasury stock shares held by the Company. In the event treasury stock shares are disbursed, "Number of new shares issued" and "Subscription price per share" shall be read as "Number of treasury stock shares disposed" and "Disposed price."


In addition, in the event of a certain occurrence such as a merger or spin-off which necessitates the Company to adjust the exercise price, the exercise price shall be adjusted rationally in consideration of the conditions of such an event.


(5) Exercise period for stock options

From July 1, 2007 until June 24, 2015.

(6) Other conditions for the exercise of stock options

The partial exercise of stock options is not permitted.

(7) Cancellation of stock options

The Company may at any time acquire and cancel stock options that it acquires.

(8) Transfer restrictions on stock options

The transfer of stock options requires the approval of the Board of Directors.
III3 . Terms for Allotment of Subscription Rights

Upon the allocation of the subscription rights, those who are allotted the subscription rights shall enter into the "Share Option Agreement" which sets forth the following terms which are deemed reasonable by the Board of Directors for the purpose of the issuance of the subscription rights.

(1) A party who is allotted the subscription rights may exercise the subscription rights also when he/she is no longer the Company's director or employee. In the event that a party who is allotted the subscription rights passes away, his/her heir may exercise the Share Option. In both of these cases, the subscription rights shall be exercised in accordance with the Stock Option Agreement.

(2) The parties who are allotted the subscription rights may not assign or pledge to any third party, or otherwise dispose of the subscription rights.

(3) The Share Option Agreement shall set forth other restrictions on the exercise of the subscription rights.

(Note)

The above proposal concerning "the issuance of subscription rights as stock options" is subject to approval at the General Shareholders' Meeting to be held on June 24, 2005.


For further information

Corporate Communications Department
Eisai Co., Ltd.
Tel: +81-3-3817-5120