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Kuraray Co., Ltd. resolved at a meeting of its Board of Directors held on August 27, 2002 the definite terms and conditions for the issue of Stock Acquisition Rights as stock options pursuant to the resolution at the 121st Ordinary General Meeting of Shareholders:

1. Class and number of shares for which Stock Acquisition Rights will be issued:

1,144,500 shares of common stock of the Company

If the Company splits or consolidates its common stock, the number of shares to be issued upon exercise of each Stock Acquisition Right shall be adjusted according to the following formula; provided, however, that such adjustment shall be made only to those remain unexercised at the time of such adjustment and; provided, further, that if any fraction less than one share arises as a result of such adjustment, such fraction shall be discarded.

2. Total number of Stock Acquisition Rights to be issued:

2,289 (The number of shares to be issued upon exercise of each Stock Acquisition Rights shall be 500.)

3. Issue price of Stock Acquisition Rights:

No consideration shall be payable.

4. Issue date of Stock Acquisition Rights:

October 1, 2002

5. Amount to be paid in upon exercise of Stock Acquisition Rights:

Whichever is higher of (i) the average (any fraction less than one yen will be rounded up) of the closing price of the common stock of the Company in the regular trading on the Tokyo Stock Exchange (including indication of any bid or offer, hereafter referred to as the "Closing Price") for 30 consecutive trading days (excluding days on which there is no Closing Price) from the beginning of 45 days period preceding the issue of Stock Acquisition Rights, multiplied by 1.05 (any fraction less than one yen will be rounded up), or (ii) the Closing Price on the day of issue of Stock Acquisition Rights (if there is no Closing Price on such date, the Closing Price on the latest trading day on which the Closing Price is quoted).

If the Company splits or consolidates its common stock after the day of issue of Stock Acquisition Rights, the exercise price shall be adjusted according to the following formula, and any fraction less than one yen resulting from this adjustment shall be rounded up.

In addition, in the case the Company issues new shares at a price lower than the then current market value after the day of issue of Stock Acquisition Rights (excluding the case where such lower price is resulted from the exercise of Stock Acquisition Rights), the exercise price shall be adjusted according to the following formula, and any fraction less than one yen resulting from this adjustment shall be rounded up.

6. Exercise period of Stock Acquisition Rights:

From June 28, 2004 to June 27, 2012.

7. Conditions for exercise of Stock Acquisition Rights:

• a) A person who received allocation of Stock Acquisition Rights shall remain a director, a statutory auditor or an employee of the Company or its subsidiaries at the time of exercise the Stock Acquisition Rights; provided, however, that a person who held a position of director, statutory auditor or associate director of the Company or president of Kuraray Engineering Co., Ltd., Kuraray Chemical Co., Ltd., Kuraray Trading Co., Ltd., Kuraray Plastics Co., Ltd., Kuraray Fudosan Co., Ltd., Kuraray Techno Co., Ltd., Techno Soft Co., Ltd., Kuraray America, Inc., Eval Company of America, Kuraray Europe GmbH, EVAL Europe N. V. and Kuraray Specialities Europe GmbH (hereafter, "Selected Subsidiaries") may exercise Stock Acquisition Rights even after resignation from such position or retirement by reason of the age limit.
• b) No transfer, assignment or any other disposal of Stock Acquisition Rights shall be permitted.
• c) Other conditions for exercise shall be determined by the "Agreement for Granting Stock Acquisition Rights" to be entered into between the Company and each person to whom Stock Acquisition Rights will be allocated, pursuant to the resolution at the 121st Ordinary General Meeting of Shareholders and this resolution at the meeting of the Board of Directors for the issue of Stock Acquisition Rights.

8. Reasons and conditions for the cancellation of Stock Acquisition Rights:

• a) In the case that a resolution for the approval of any joint venture agreement under which the Company is merged into other company, or any share exchange agreement under which the Company will become a wholly-owned subsidiary of other company is adopted at the General Meeting of Shareholders of the Company, the Company may cancel Stock Acquisition Rights without any consideration therefor.
• b) In case that a person who received allocation of Stock Acquisition Rights (other than a person who held a position of director, statutory auditor or associate director of the Company or president of any of Selected Subsidiaries) fails to exercise its Stock Acquisition Rights by reason of loss of its position as director, statutory auditor or employee of the Company or any of its subsidiaries before exercising its rights, or pass away before exercising its rights, the Company may cancel such Stock Acquisition Rights without any consideration therefor.

9. Restriction on transfer of Stock Acquisition Rights:

Any transfer of Stock Acquisition Rights shall require an approval of the Board of Directors.

10. Issue of security representing Stock Acquisition Rights:

No security representing any of Stock Acquisition Rights shall be issued by the Company unless it is demanded by a person who received allocation of Stock Acquisition Rights.

11. Amount not to be incorporated into capital out of issue price of new shares of stock:

In case new shares of stock are issued by the Company as a result of the exercise of Stock Acquisition Rights, the amount not to be incorporated into the capital out of the issue price per share of such new shares of stock shall be the exercise price less the amount to be incorporated into the capital, which is the exercise price multiplied by 0.5 (any function less than one yen shall be rounded up).

12. Initial date in reckoning the dividend period with respect to the shares of stock issued as a result of the exercise of Stock Acquisition Rights:

The initial date in reckoning the dividend period for the first primary or interim dividend (an allotment of money as stipulated in Article 293-5 of the Commercial Code) with respect to the shares of stock issued as a result of the exercise of Stock Acquisition Rights shall be April 1 if the exercise of Stock Acquisition Rights is made during a period starting on April 1 and ending on the following September 30, or October 1 if the exercise of Stock Acquisition Rights is made during a period starting on October 1 and ending on the following March 31.

13. Persons who receive allocation of Stock Acquisition Rights, number of Stock Acquisition Rights allocated and number of shares to be issued:

500 shares per one Stock Acquisition Right

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