Document:

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                              SEVENTH AMENDMENT TO
                           SECOND AMENDED AND RESTATED
                        AGREEMENT OF LIMITED PARTNERSHIP
                      OF FELCOR LODGING LIMITED PARTNERSHIP

      This Seventh Amendment to Second Amended and Restated Agreement of Limited
Partnership of FelCor Lodging Limited Partnership (the "Partnership") is made
and entered into effective as of April 7, 2005, by and among FelCor Lodging
Trust Incorporated, a Maryland corporation, as General Partner (the "General
Partner"), and all persons and entities who are, or shall in the future become,
Limited Partners of the Partnership in accordance with the provisions of the
Partnership Agreement (as hereinafter defined).

                                    RECITALS:

      A.    The General Partner and the existing Limited Partners (the General
Partner and the Limited Partners, collectively, referred to herein as the
"Partners") have previously executed and delivered that certain Second Amended
and Restated Agreement of Limited Partnership of FelCor Lodging Limited
Partnership, dated as of December 31, 2001, as amended (as amended, herein
referred to as the "Partnership Agreement"), and the Partnership Agreement
governs the Partnership.

      B.    Pursuant to Sections 1.4 and 4.6 of the Partnership Agreement, the
General Partner is authorized to cause the Partnership to issue Partnership
Securities for any Partnership purpose, at any time or from time to time, to the
Partners or to other persons for such consideration and on such terms and
conditions as shall be established by the General Partner in its sole
discretion.

      C.    The General Partner desires to exercise such authority by amending
the Partnership Agreement as provided herein to establish a new class and series
of Partnership Securities.

                               A G R E E M E N T S

      NOW, THEREFORE, in consideration of the agreements and obligations of the
parties set forth herein and of other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:

      1.    Amendment of Partnership Agreement. The Partnership Agreement is
hereby amended to add Addendum No. 4 to the Partnership Agreement to create and
provide for the authorization for issuance of a class of the Partnership
Securities designated as the "Series E Cumulative Redeemable Preferred Units,"
having the preferences and relative, participating, optional or other special
rights, powers and duties set forth in such Addendum No. 4. Such Addendum No. 4
shall be in the form of Addendum No. 4 attached to this Seventh Amendment to
Second Amended and Restated Agreement of Limited Partnership of FelCor Lodging
Limited Partnership. The Addendum No. 4 is hereby incorporated into and made a
part of the Partnership Agreement for all purposes.

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      2.    Defined Terms; Effect Upon Partnership Agreement. All initially
capitalized terms used without definition herein shall have the meanings set
forth therefor in the Partnership Agreement. Except as expressly amended hereby,
the Partnership Agreement shall remain in full force and effect and each of the
parties hereto hereby reaffirms the terms and provisions thereof.

                             SIGNATURE PAGE FOLLOWS

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         IN WITNESS WHEREOF, the General Partner has caused this Amendment to be
duly executed in its respective capacities set forth below as of the date first
set forth above.

                              GENERAL PARTNER:

                              FELCOR LODGING TRUST INCORPORATED,
                              a Maryland corporation

                              By:____________________________________
                              Name: Lawrence D. Robinson

                              Title: Executive Vice President, General Counsel &
                                     Secretary

                              LIMITED PARTNERS (for all the Limited Partners now
                              and hereafter admitted as limited partners of the
                              Partnership, pursuant to the powers of attorney in
                              favor of the General Partner contained in Section
                              1.4 of the Agreement):

                              By: FELCOR LODGING TRUST INCORPORATED,
                                  acting as General Partner and as duly
                                  authorized attorney-in-fact

                              By:____________________________________
                              Name: Lawrence D. Robinson
                              Title: Executive Vice President, General
                                     Counsel & Secretary
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                       FELCOR LODGING LIMITED PARTNERSHIP

                  ADDENDUM NO. 4 TO SECOND AMENDED AND RESTATED
                        AGREEMENT OF LIMITED PARTNERSHIP

                                 DESIGNATION OF
                 SERIES E CUMULATIVE REDEEMABLE PREFERRED UNITS

      The undersigned General Partner of FelCor Lodging Limited Partnership, a
Delaware limited partnership (the "PARTNERSHIP"), pursuant to the authority
expressly granted to the General Partner by the Second Amended and Restated
Agreement of Limited Partnership of FelCor Lodging Limited Partnership, dated as
of December 31, 2001, as amended, pursuant to which the Partnership was formed
(the "PARTNERSHIP AGREEMENT"), and in particular Sections 1.4 and 4.6 thereof,
hereby executes and delivers this Addendum No. 4 to the Partnership Agreement
(the "ADDENDUM"), which Addendum is hereby made a part of the Partnership
Agreement for all purposes, to create and provide for the issue of a class of
Partnership Units and to fix the designations, preferences and relative,
participating, optional or other special rights, powers and duties thereof as
follows:

      1.    DESIGNATION OF CLASS. A class of units of the Partnership is hereby
authorized and designated as the "Series E Cumulative Redeemable Preferred
Units" (the "SERIES E PREFERRED UNITS"). The Series E Preferred Units shall have
the preferences and relative, participating, optional or other special rights,
powers and duties that are set forth in this Addendum and, to the extent
permitted by this Addendum, established by the General Partner and set forth in
any amendment to the Partnership Agreement or any amendment or annex to this
Addendum.

      2.    AUTHORIZED NUMBER OF SERIES E PREFERRED UNITS. The authorized number
of Series E Preferred Units shall be 54,000.

      3.    PREFERENCES, RIGHTS, POWERS AND DUTIES.

            3.1   DEFINITIONS. For purposes of the Series E Preferred Units, the
      following terms shall have the meanings indicated:

            "Addendum" shall have the meaning set forth in the preamble hereof.

            "Business Day" shall mean any day other than a Saturday, Sunday or a
      day on which state or federally-chartered banking institutions in Texas or
      New York are not required to be open.

            "Call Date" shall have the meaning set forth in Section 3.4(b)
      hereof.

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            "Common Unit" shall mean the units of partnership interest of the
      Partnership not designated as Preferred Units.

            "Common Stock" shall mean the common stock, $0.01 par value per
      share, of the General Partner.

            "Distribution Payment Date" shall mean the last calendar day of
      January, April, July and October, in each year, commencing on July 31,
      2005; PROVIDED, HOWEVER, that if any Distribution Payment Date falls on
      any day other than a Business Day, the distribution payment due on such
      Distribution Payment Date shall be paid on the Business Day immediately
      following such Distribution Payment Date.

            "Distribution Period" shall mean quarterly distribution periods
      commencing February 1, May 1, August 1 and November 1 of each year and
      ending on and including the day preceding the first day of the next
      succeeding Distribution Period (other than the initial Distribution
      Period, which shall commence on April 7, 2005 and end on and include July
      31, 2005).

            "General Partner" shall mean FelCor Lodging Trust Incorporated, a
      Maryland corporation, which is the sole general partner of the
      Partnership.

            "Issue Date" shall mean the date, from time to time, on which the
      Partnership issues a Series E Preferred Unit.

            "Junior Units" shall have the meaning set forth in Section 3.6(c)
      hereof.

            "Parity Units" shall have the meaning set forth in Section 3.6(b)
      hereof.

            "Partnership" shall have the meaning set forth in the preamble
      hereof.

            "Partnership Agreement" shall have the meaning set forth in the
      preamble hereof.

            "Preferred Units" shall mean units of partnership interest of the
      Partnership designated as having certain preferences to the Common Units
      with respect to distributions or upon liquidation of the Partnership.

            "Series C Preferred Stock" shall mean the 8% Series C Cumulative
      Redeemable Preferred Stock, $0.01 par value and $2,500.00 liquidation
      preference per share, of the General Partner.

            "Series E Preferred Units" shall have the meaning set forth in
      Section 1 hereof.

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      "set apart for payment" shall be deemed to include, without any action
other than the following, the recording by the Partnership in its accounting
ledgers of any accounting or bookkeeping entry which indicates, pursuant to a
declaration of dividends or other distribution by the Partnership, the
allocation of funds to be so paid on any series or class of capital units of the
Partnership; PROVIDED, HOWEVER, that if any funds for a class or series of
Junior Units or any class or series of Parity Units are placed in a separate
account of the Partnership or delivered to a disbursing, paying or other similar
agent, then "set apart for payment" with respect to the Series E Preferred Units
shall mean placing such funds in a separate account or delivering such funds to
a disbursing, paying or other similar agent.

      Initially capitalized terms used without definition herein shall have the
meanings set forth therefor in the Partnership Agreement. Other terms defined
herein have the meanings so given them. Whenever the context requires, the
gender of all words used in this Addendum shall include the masculine, feminine
and neuter form of such words, and the singular form shall include the plural
and vice versa.

      3.2 DISTRIBUTIONS.

      (a)   The holders of the Series E Preferred Units shall be entitled to
receive, when, as and if declared by the General Partner out of funds legally
available for that purpose, distributions payable in cash in an amount per
Series E Preferred Unit equal to $200.00 per year. Such distributions shall be
cumulative from the Issue Date of such units, whether or not in any Distribution
Period or Periods there shall be funds of the Partnership legally available for
the payment of such distributions and whether or not such distributions are
authorized, and shall be payable quarterly, when, as and if declared by the
General Partner, in arrears on Distribution Payment Dates, commencing on the
first Distribution Payment Date after the Issue Date. Each such distribution
shall be payable in arrears to the holders of record of the Series E Preferred
Units, as they appear on the records of the Partnership at the close of business
on such record dates, not more than sixty (60) days preceding such Distribution
Payment Dates thereof, as shall be fixed by the General Partner. Accrued and
unpaid distributions for any past Distribution Periods may be declared and paid
at any time, without reference to any regular Distribution Payment Date, to
holders of record on such date, not exceeding forty-five (45) days preceding the
payment date thereof, as may be fixed by the General Partner.

      (b)   The amount of distributions payable for each full Distribution
Period for the Series E Preferred Units shall be computed by dividing the annual
distribution rate by four. The amount of distributions payable for any period
shorter or longer than a full Distribution Period, on the Series E Preferred
Units shall be computed on the basis of a 360-day year consisting of twelve
30-day months. Holders of the Series E Preferred Units shall not be entitled to
any distributions, whether payable in cash, property or units, in excess of
cumulative distributions, as herein provided, on the Series E Preferred Units.
No interest, or sum of money in lieu of interest, shall be payable in respect of
any distribution payment or payments on the Series E Preferred Units that may be
in arrears.

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      (c)   So long as any of the Series E Preferred Units are outstanding, no
distributions, except as described in the immediately following sentence, shall
be declared or paid or set apart for payment on any class or series of Parity
Units for any period unless full cumulative distributions have been, or
contemporaneously are, declared and paid, or declared and a sum sufficient for
the payment thereof set apart for such payment on the Series E Preferred Units
for all Distribution Periods terminating on or prior to the Distribution Payment
Date on such class or series of Parity Units. When distributions are not paid in
full or a sum sufficient for such payment is not set apart, as aforesaid, all
distributions declared upon the Series E Preferred Units and all distributions
declared upon any other class or series of Parity Units shall be declared
ratably in proportion to the respective amounts of distributions accumulated and
unpaid on the Series E Preferred Units and accumulated and unpaid on such Parity
Units.

      (d)   So long as any of the Series E Preferred Units are outstanding, no
distributions (other than dividends or distributions paid in units of, or
options, warrants or rights to subscribe for or purchase units of, Junior
Units), shall be declared or paid or set apart for payment or other distribution
declared or made upon Junior Units, nor shall Junior Units be redeemed,
purchased or otherwise acquired (other than a redemption, purchase or other
acquisition of Common Units made for purposes of an employee incentive or
benefit plan of the Partnership for any consideration (or any moneys be paid to
or made available for a sinking fund for the redemption of any such units) by
the Partnership, directly or indirectly), unless in each case (i) the full
cumulative distributions on all outstanding Series E Preferred Units and any
other Parity Units shall have been paid or set apart for payment for all past
Distribution Periods with respect to the Series E Preferred Units and all past
distribution periods with respect to such Parity Units and (ii) sufficient funds
shall have been paid or set apart for the payment of the distribution for the
current Distribution Period with respect to the Series E Preferred Units and the
current Distribution Period with respect to such Parity Units.

      3.3 LIQUIDATION PREFERENCE.

      (a)   In the event of any liquidation, dissolution or winding up of the
Partnership, whether voluntary or involuntary, before any payment or
distribution of the assets of the Partnership (whether capital or surplus) shall
be made to or set apart for the holders of Junior Units, the holders of the
Series E Preferred Units shall be entitled to receive two thousand five hundred
dollars ($2,500.00) per Series E Preferred Unit plus an amount equal to all
distributions (whether or not earned or declared) accrued and unpaid thereon to
the date of final distribution to such holders, but such holders shall not be
entitled to any further payment. If, upon any liquidation, dissolution or
winding up of the Partnership, the assets of the Partnership, or proceeds
thereof, distributable among the holders of the Series E Preferred Units shall
be insufficient to pay in full the preferential amount aforesaid and liquidating
payments on any other class or series of Parity Units, then such assets, or the
proceeds thereof, shall be distributed among the holders of the Series E
Preferred Units and any such other Parity Units ratably in accordance with the
respective amounts that would be payable on such Series E Preferred Units and
any such other Parity Units if all amounts payable thereon were paid in full.
For the purposes of this Section 3.3, (i) a consolidation or merger of the
Partnership with one or more

                                     - 4 -
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Persons, (ii) a sale or transfer of all or substantially all of the assets of
the Partnership, or (iii) a statutory exchange of units shall not be deemed to
be a liquidation, dissolution or winding up, voluntary or involuntary, of the
Partnership.

      (b)   Subject to the rights of the holders of any series or class or
classes of Parity Units, after payment shall have been made in full to the
holders of the Series E Preferred Units, as provided in this Section 3.3, any
other series or class or classes of Junior Units shall, subject to the
respective terms and provisions (if any) applying thereto, be entitled to
receive any and all assets remaining to be paid or distributed, and the holders
of the Series E Preferred Units shall not be entitled to share therein.

      3.4 REDEMPTION.

      (a)   The Series E Preferred Units shall be redeemable by the Partnership
solely when, as, and if any share of the Series C Preferred Stock is redeemed by
the General Partner and in the same proportion as shares of the Series C
Preferred Stock are redeemed by the General Partner so that the number of Series
E Preferred Units remaining unredeemed shall be the same as, and at all times
equal to, the number of shares of Series C Preferred Stock remaining unredeemed.
The Series C Preferred Stock is not redeemable by the General Partner prior to
April 7, 2010, and, therefore, the Series E Preferred Units shall not be
redeemable by the Partnership prior to such date.

      (b)   Upon redemption of the Series E Preferred Units by the Partnership
on the date specified in the notice to holders required under subparagraph (d)
of this Section 3.4 (the "CALL DATE"), each Series E Preferred Unit called for
redemption shall be redeemed in cash at a price per unit equal to $2,500.00 per
unit, plus all accrued and unpaid distributions thereon to the Call Date,
without interest, to the extent that the Partnership has funds legally available
therefor. The redemption price of the Series E Preferred Units may be paid from
any source. Distributions payable on the Series E Preferred Units for any period
greater or less than a full dividend period will be computed on the basis of a
360-day year consisting of twelve 30-day months.

      (c)   If full cumulative distributions on the Series E Preferred Units and
any other class or series of Parity Units have not been paid, or declared and
set apart for payment, the Series E Preferred Units may not be redeemed in part
and the Partnership may not purchase or acquire Series E Preferred Units,
otherwise than pursuant to a purchase or exchange offer made on the same terms
to all holders of Series E Preferred Units.

      (d)   If the Partnership shall redeem Series E Preferred Units pursuant to
this Section 3.4, notice of such redemption shall be given to the record holders
of the Series E Preferred Units called for redemption as soon as practicable
after notice of redemption of the Series C Preferred Stock is given by the
General Partner.

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      From and after the Call Date (unless the Partnership shall fail to make
available the amount of cash necessary to effect such redemption), (i) except as
otherwise provided herein, distributions on the Series E Preferred Units so
called for redemption shall cease to accrue, (ii) such units shall no longer be
deemed to be outstanding, and (iii) all rights of the holders thereof as holders
of Series E Preferred Units shall cease (except the rights to receive the cash
payable upon such redemption, without interest thereon, upon surrender and
endorsement of their certificates).

      As promptly as practicable after the surrender in accordance with such
notice of the certificates for any such units so redeemed (properly endorsed or
assigned for transfer, if the Partnership shall so require and if the notice
shall so state), such units shall be exchanged for cash (without interest
thereon) for which such units have been redeemed. If fewer than all the
outstanding Series E Preferred Units are to be redeemed, units to be redeemed
shall be selected by the Partnership from outstanding Series E Preferred Units
not previously called for redemption by lot or pro rata (as nearly as may be) or
by any other method determined by the Partnership in its sole discretion to be
equitable. If fewer than all the Series E Preferred Units represented by any
certificate are redeemed, then new certificates representing the unredeemed
units shall be issued without cost to the holder thereof.

      3.5   CONVERSION. Holders of Series E Preferred Units shall have no
conversion rights.

      3.6   RANKING. Any class or series of units of the Partnership shall be
deemed to rank:

      (a)   prior to the Series E Preferred Units, as to the payment of
distributions and as to distribution of assets upon liquidation, dissolution or
winding up, if the holders of such class or series shall be entitled to the
receipt of distributions or of amounts distributable upon liquidation,
dissolution or winding up, as the case may be, in preference or priority to the
holders of Series E Preferred Units;

      (b)   on a parity with the Series E Preferred Units, as to the payment of
distributions and as to distribution of assets upon liquidation, dissolution or
winding up, whether or not the distribution rates, distribution payment dates or
redemption or liquidation prices per unit thereof are different from those of
the Series E Preferred Units, if the holders of such class of units or series
and the Series E Preferred Units shall be entitled to the receipt of
distributions and of amounts distributable upon liquidation, dissolution or
winding up in proportion to their respective amounts of accrued and unpaid
distributions per unit or liquidation preferences, without preference or
priority one over the other ("PARITY UNITS"); the Series A Cumulative
Convertible Preferred Units and the Series B Cumulative Redeemable Preferred
Units shall be Parity Units with respect to the Series E Preferred Units; and

      (c)   junior to the Series E Preferred Units, as to the payment of
distributions or as to the distribution of assets upon liquidation, dissolution
or winding up, if such units or series shall be Common Units or if the holders
of the Series E Preferred Units shall be

                                     - 6 -
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entitled to receipt of distributions or of amounts distributable upon
liquidation, dissolution or winding up, as the case may be, in preference or
priority to the holders of such units or series ("JUNIOR UNITS").

      3.7   RECORD HOLDERS. The Partnership may deem and treat the record holder
of any Series E Preferred Units as the true and lawful owner thereof for all
purposes, and the Partnership shall not be affected by any notice to the
contrary.

                             SIGNATURE PAGE FOLLOWS

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      IN WITNESS WHEREOF, the Partnership has caused this Addendum to be
executed by its General Partner, acting through its duly authorized officer, as
of this 7th day of April 2005.

                              FELCOR LODGING LIMITED PARTNERSHIP

                              By: FELCOR LODGING TRUST INCORPORATED, a
                                  Maryland corporation, as its General Partner

                                  By:____________________________________
                                  Name: Lawrence D. Robinson
                                  Title: Executive Vice President,
                                         General Counsel and Secretary

                                     - 8 -ELAN CORPORATION, PLC

                          EMPLOYEE EQUITY PURCHASE PLAN

                                NOVEMBER 14, 2004

                                    ARTICLE I

                                  INTRODUCTION

                  Section 1.1 Purpose. The purpose of the Elan Corporation, plc
(the "Company") Employee Equity Purchase Plan is to provide employees with an
opportunity to acquire Shares of the Company through accumulated payroll
deductions.

                  Section 1.2 Rules of Interpretation and Governing Law. (a) It
is the intention of the Company to have the Plan qualify as an "employee stock
purchase plan" under Section 423 of the Internal Revenue Code of 1986 of the
United States of America, as amended (the "Code") and the Plan and/or any
schedule may qualify as an employees'share scheme for the purposes of Section 2
of the Companies (Amendment) Act, 1983. The provisions of the Plan shall be
construed so as to extend and limit participation in a manner consistent with
the requirements of Section 423 of the Code.

                  (b) This Plan will be construed in accordance with and
governed by the laws of Ireland. Any schedule to the Plan setting out the rules
of a share scheme established pursuant to Section 1.3 may be construed in
accordance with the law of another jurisdiction, if so specified in that
schedule.

         Section 1.3 Further Plans. The Board may operate the Plan for Employees
in any country it deems appropriate and may modify the operation of the Plan or
establish further share schemes based on the Plan but modified, to take account
of local tax, exchange control, securities or other applicable laws in overseas
territories, provided that any Shares made available under such further schemes
are treated as counting against the limits set out in Section 4.1 of the Plan.
Such further schemes may be established as schedules to the Plan, or otherwise
as the Board determines and may be treated as separate plans and construed
separately from the Plan

         Section 1.4 Plan Operation. The Board has discretion to determine when
the Plan will be operated.

                                   ARTICLE II

                                   DEFINITIONS

                  Section 2.1 "Board" means the Board of Directors of the
Company.

                  Section 2.2 "Compensation" means all base, straight-time,
gross earnings exclusive of payments for overtime, incentive compensation,
incentive payment, bonuses and other compensation.

                  Section 2.3 "Committee" means the Leadership Development and
Compensation Committee of the Company (formerly known as the Compensation
Committee), or such other committee of the Board as the Board shall direct.

                  Section 2.4 "Designated Company" means any company within the
Group which has been designated by the Board to participate in the Plan.

                  Section 2.5 "Employee" means any individual who (i) is
customarily employed by a Designated Company on a full-time or part-time basis
and (ii) unless otherwise provided by the Committee, is regularly scheduled to
work more than 20 hours per week and more than five

months in any calendar year. For the purposes of this Plan, the employment
relationship shall be treated as continuing intact while the individual is on
sick leave or another leave of absence approved by the Company or the Designated
Company or required by the relevant local law to constitute continuous service.
Where the period of leave exceeds 90 days and the individual's right to
employment is not guaranteed either by statute or by contract, the employment
relationship shall be deemed to have terminated on the 91st day of such leave.

                  Section 2.6 "Effective Date" means January 1, 2005, subject to
the provisions of Section 12.8 hereof.

                  Section 2.7 "Enrollment Date" means the first Offering Period
Commencement Date on which the Employee shall have satisfied the eligibility
requirements of Article III of this Plan.

                  Section 2.8 "Exercise Date" means the last day of each
Offering Period.

                  Section 2.9 "Fair Market Value" means, as of any date, the
value of a Share determined as follows:

                  (a) if the Shares are listed on a national securities exchange
or quotation system, the closing sales price on such exchange or quotation
system on such date or, in the absence of reported sales price on such date, the
closing sales price on the immediately preceding date on which sales were
reported,

                  (b) if the Shares are not listed on a national securities
exchange or quotation system, the mean between the high bid and low offered
prices as quoted by the National Association of Securities Dealers, Inc.
Automated Quotation System ("NASDAQ") for such date, or

                  (c) if the Shares are neither listed on a national securities
exchange or quotation system nor quoted by NASDAQ, the fair value as determined
by such other method as the Committee determines in good faith to be reasonable.

                  Whenever possible the determination of Fair Market Value shall
be determined by reference to the prices quoted on the New York Stock Exchange.

                  Section 2.10 "Group" means the Company and its Subsidiaries.

                  Section 2.11 "Offering Period" means each quarter described in
Section 4.2 during which an option granted under Section 6.1 of this Plan may be
exercised.

                  Section 2.12 "Offering Period Commencement Date" means the
first day of the applicable Offering Period.

                  Section 2.13 "Option Price" means the amount described in
Section 6.2 of the Plan.

                  Section 2.14 "Participant" means an Employee who has satisfied
the eligibility requirements of Article III of this Plan and has elected to
participate in this Plan pursuant to Section 3.3.

                  Section 2.15 "Plan" means the Elan Corporation, plc Employee
Equity Purchase Plan as set out in these rules.

                  Section 2.16 "Plan Administrator" means the person designated
by the Committee pursuant to Section 11.1(b) hereof to take certain
administrative actions under the Plan.

                  Section 2.17 "Share" or "Shares" means a share in the Company
with a par value of 5 Euro cents as represented by one American Depositary Share
and evidenced by one American Depositary Receipt.

                  Section 2.18 "Subsidiary" means any company, if the Company
and/or one or more other Subsidiaries own not less than 50% of the total
combined voting power of all classes of outstanding stock of such company. A
company that attains the status of a Subsidiary on a date after the adoption of
the Plan shall be considered a Subsidiary commencing as of such date.

                                   ARTICLE III

                          ELIGIBILITY AND PARTICIPATION

                  Section 3.1 Eligibility.

                  (a) Subject to the provisions of Section 3.2, an Employee will
be eligible to participate in this Plan on any Enrollment Date occurring on or
after the date on which such Employee has commenced employment with a Designated
Company.

                  (b) Each Employee who becomes eligible to participate in this
Plan shall be furnished with a summary of the Plan. All Shares acquired under
the Plan will be held in an individual custody account and shall be subject to,
and governed by, the terms and conditions of the applicable individual custody
account agreement.

                  (c) An eligible employee may become a participant in the Plan
by contacting the plan recordkeeper (The Bank of New York, "BNY") via the plan's
website or via telephone prior to the applicable Enrollment Date. The deduction
election chosen shall remain in effect throughout successive Offering Periods
unless terminated by the employee.

                  Section 3.2 Restrictions on Participation. Notwithstanding any
provision of the Plan to the contrary, no Employee shall be eligible to
participate in the Plan and receive an option to acquire Shares to the extent
that, immediately after the grant, such Employee would own Shares and/or hold
outstanding options to purchase Shares amounting to 5% or more of the total
combined voting power or value of all classes of stock of the Company or of any
Subsidiary (for purposes of this paragraph, the rules of Section 424(d) of the
Code shall apply in determining stock ownership of any Employee).

                  Section 3.3  Commencement of Participation.

                  (a) An Employee may become a Participant by electing a
deduction percentage through one of BNY's automated systems or by speaking to a
Customer Service Representative (CSR) during the enrollment period. (b) Payroll
deductions for a Participant shall commence on the first day of the first full
payroll period following the Participant's Enrollment Date and shall end on the
last day of the payroll period ending within the Offering Period to which the
authorization is applicable, unless sooner terminated by the Participant as
provided in Article VIII or as reduced by the Plan Administrator as described in
Section 5.4.

                  Section 3.4 Code Limitations. In addition to any other
limitations set forth in the Plan, no Employee may be granted an option under
the Plan which permits his or her rights to purchase stock under the Plan, and
any other stock purchase plan of his or her employer corporation and its Parent
(within the meaning of Section 424(e) of the Code) and Subsidiary corporations
that is qualified under Section 423 of the Code, to accrue at a rate which
exceeds

US$25,000 of the Fair Market Value of such stock (determined at the time such
option is granted) for each calendar year in which the option is outstanding at
any time.

                                   ARTICLE IV

                    SHARES SUBJECT TO THE PLAN AND OFFERINGS

                  Section 4.1  Shares Subject to the Plan.

                  (a) Subject to the provisions of Section 12.4 of the Plan, the
aggregate number of Shares that may be issued or delivered pursuant to the Plan
shall not exceed 800,000. These Shares may be authorized but unissued Shares,
issued Shares held in or acquired for the Company's treasury or Shares
reacquired by the Company upon purchase in the open market. The Company may, at
its discretion, set a maximum number of Shares which may be delivered in an
Offering Period.

                  (b) If, on any Exercise Date, the number of Shares with
respect to which options are to be exercised exceeds the number of Shares
available for purchase during the Offering Period, then the Company shall make a
pro rata allocation of the Shares remaining available for purchase in as uniform
a manner as shall be practicable and as the Committee shall determine to be
equitable and in accordance with the requirements of Section 423 of the Code.

                  Section 4.2 Offering Periods. Shares will be available for
acquisition by Participants during each of the four Offering Periods to be held
during each calendar year that the Plan is in effect. Except as provided in
Section 12.4(b), the first Offering Period will begin on January 1st and end on
March 31st, the second Offering Period will begin on April 1st and end on June
30th, the third Offering Period will begin on July 1st and end September 30th
and the fourth Offering Period will begin on October 1st and end on December
31st. The Plan Administrator may make changes to the Offering Periods, provided
such changes are not inconsistent with Section 423 of the Code.

                                    ARTICLE V

                               PAYROLL DEDUCTIONS

                  Section 5.1 Amount of Deduction. Subject to the limitations
mandated in Section 3.4, t a Participant may elect to have payroll deductions
made in whole percentages of up to 100% of the Participant's Compensation
(exclusive of applicable taxes and payroll deductions and other contributions)
for each payroll period in an Offering Period, but the amount deducted for any
Participant for an Offering Period may not exceed an amount equal to (i) the
"applicable dollar amount" (as defined in Section 402(g)(1)(B) of the Code) for
the applicable calendar year, divided by (ii) 4.

                  Section 5.2 Participant's Memorandum Account. All payroll
deductions made for a Participant shall be credited to a memorandum account
established for such Participant for purposes of recording, as a bookkeeping
entry, the payroll deductions made by the Participant under this Plan. A
Participant may not make any separate cash payment with respect to such
memorandum account.

                  Section 5.3 Changes in Payroll Deductions. During any Offering
Period, a Participant may discontinue his participation in this Plan for that
Offering Period as provided in Section 8.1 hereof or, not more than once during
any Offering Period, he or she may decrease the rate of his payroll deductions
during that Offering Period by contacting The Bank of New York

and electing a change in deduction percentage. These changes will then be
communicated to Elan Corporation. The new payroll deduction election shall
become effective as of the first day of the first full payroll period
immediately following five (5) business days after the Plan Administrator's
receipt of the new payroll deduction percentages from The Bank of New York.

                  Section 5.4 Certain Adjustments to Payroll Deduction
Authorizations.

                  (a) To the extent necessary to comply with (i) the limitations
contained in the Plan on the number of shares available to any Participant and
(ii) the limitations in Section 3.4, a Participant's payroll deductions may be
reduced to zero percent (0%) by the Plan Administrator without the Participant's
consent, at any time during an Offering Period.

                  (b) In the event that a Participant's payroll deductions are
reduced pursuant to Section 5.4(a) above, payroll deductions shall recommence
for such Participant at the rate specified in the Participant's payroll
deduction on file with the Plan Administrator effective as of the beginning of
the first Offering Period which is scheduled to end in the immediately
succeeding calendar year, unless the payroll deduction authorization election is
terminated by the Participant, as provided in Section 8.1 hereof.

                                   ARTICLE VI

                               GRANTING OF OPTION

                  Section 6.1 Maximum Number of Option Shares. On each Offering
Period Commencement Date, each Participant in the Plan shall be granted an
option to acquire, at the applicable Option Price, up to the number of Shares
determined by dividing such Participant's payroll deductions accumulated prior
to such Exercise Date during the applicable Offering Period and credited to the
Participant's memorandum account as of such Exercise Date by the applicable
Option Price; provided, however, that such option grant shall also be subject to
the limitations contained in Sections 3.2, 3.4, 4.1, 5.1 and 8.1 of the Plan;
provided further, however that in no event shall the number of Shares that may
be purchased under any such option exceed 1000 Shares or such higher or lower
number of Shares as the Committee may have specified in advance of such Offering
Period as the maximum amount of Shares which may be purchased by a Participant
in such Offering Period.

                  Section 6.2 Option Price. Unless the Committee determines
before the first day of an Offering Period that a higher price that complies
with Section 423 of the Code shall apply with respect to such Offering Period,
the Option Price for Shares to be acquired with accumulated payroll deductions
during any Offering Period shall be the lower of 85% of the Fair Market Value of
a Share on the applicable (a) Offering Period Commencement Date, or (b) Exercise
Date.

                                   ARTICLE VII

                               EXERCISE OF OPTION

                  Section 7.1 Automatic Exercise. Unless the Participant
withdraws from the Plan as provided in Section 8.1 , the option granted to the
Participant pursuant to Section 6.1 of the Plan during the applicable Offering
Period shall be exercised automatically on the applicable Exercise Date for the
purchase of the number of full and fractional Shares which the accumulated
payroll deductions credited to the Participant's memorandum account at such time
will acquire at the applicable Option Price; provided, however, that in no event
shall the accumulated payroll deductions credited to the Participant's
memorandum account as of the Exercise Date be used to acquire Shares that exceed
the maximum number of Shares available for acquisition after the application of
Sections 3.2, 3.4, 4.1 and/or 5.1. Any amounts remaining to the credit of such
Participant in the memorandum account following an applicable Exercise Date as a
result of the

application of Sections 3.2, 3.4, 4.1 and/or 5.1 shall be promptly
refunded to the Participant, without interest.

                  Section 7.2 Fractional Shares. Fractional Shares will be
issued under the Plan.

                  Section 7.3 Exercise of Options. An option granted to a
Participant under this Plan may be exercised only during the Participant's
lifetime and only by such Participant.

                  Section 7.4 Delivery of Shares. As promptly as practicable
after each Exercise Date on which an acquisition of Shares occurs, the Shares
purchased in the Offering Period upon the exercise of such Participant's option
hereunder shall be credited to the individual participant's account, held in
book-entry form at The Bank of New York.

                  Section 7.5  Stock Transfer Restrictions.

                  (a) Shares acquired pursuant to the Plan may not be disposed
of by the Participant for at least 3 months following the Exercise Date. Is this
true?

                  (b) The Plan is intended to satisfy the requirements of
Section 423 of the Code. A Participant will not obtain the benefits of this
provision if such Participant disposes of Shares acquired pursuant to the Plan
within two (2) years after the Offering Period Commencement Date or within one
(1) year after the date such Shares are acquired by the Participant on the
applicable Exercise Date, whichever is later.

                  Section 7.6 Taxes. At the time an option is granted or
exercised under this Plan, in whole or in part, or at the time some or all of
the Shares issued under the Plan are delivered to a Participant, or are disposed
of, the Company or any Subsidiary, in its sole discretion, shall be entitled to
withhold the amount it determines necessary to satisfy any United States
federal, state, local, foreign, or other tax or social security withholding
obligations arising, or to require as a condition of the grant or exercise of an
option or the delivery of Shares that the Participant remit, when due, the
amount necessary to satisfy such tax or social security withholding obligations.

                                  ARTICLE VIII

                                   WITHDRAWAL

                  Section 8.1 In General. A Participant may withdraw all, but
not less than all, of the payroll deductions credited to his or her memorandum
account that have not yet been used to exercise his or her option under the Plan
at any time before the end of the Offering Period by contacting The Bank of New
York and electing a refund of contributions. All of the payroll deductions
credited to the Participant's memorandum account shall be paid to such
Participant promptly after the Plan Administrator's receipt of such notice of
withdrawal, without interest, and the Participant's option for the Offering
Period shall be automatically terminated and no further payroll deductions for
the purchase of shares shall be made on behalf of such Participant for such
Offering Period. If a Participant withdraws from the Plan during an Offering
Period, payroll deductions shall not resume at the beginning of the next
immediately succeeding Offering Period unless the Participant contacts The Bank
of New York and elects a new deduction percentage prior to the applicable
Offering Period Commencement Date and in such time and manner as the Committee
shall prescribe.

                  Section 8.2 Effect on Subsequent Participation. An Employee's
withdrawal from participation in the Plan pursuant to Section 8.1 hereof will
not have any effect upon the Employee's eligibility to participate in the Plan
during any succeeding Offering Period or in any similar plan which may hereafter
be adopted by the Company and for which such Employee is otherwise eligible;
provided, however, in order to resume participation in this Plan, the Employee
must satisfy the requirements of Article III.

                  Section 8.3 Termination of Employment. Upon the termination of
a Participant's employment for any reason, including retirement or death, the
Participant shall be deemed to have withdrawn from the Plan and the payroll
deductions that have accumulated for such Participant prior to such termination,
if any, shall be promptly returned, without interest, to the Participant or, in
the case of the Participant's death, to the person or persons entitled thereto
under Section 12.1 hereof, and such Participant's option shall be automatically
terminated, and no further payroll deductions for the purchase of Shares shall
be made for the Participant with respect to such Offering Period.

                                   ARTICLE IX

                                    INTEREST

                  Section 9.1 Payment of Interest. No interest will accrue or be
paid or allowed on any money paid into the Plan, credited to the memorandum
account, or distributed to a Participant.

                                    ARTICLE X

                                     SHARES

                  Section 10.1 Participant's Interest in Option Shares. No
Participant will have any interest in Shares covered by any option held by the
Participant until the Shares have been delivered as provided in Section 7.4
above.

                  ???Section 10.2 Registration of Shares. Shares acquired by a
Participant under the Plan will be registered in the name of the Participant,
or, if the Participant so directs by written notice to the Plan Administrator at
least five business days prior to the applicable Exercise Date, in the names of
the Participant and one such other person as may be designated by the
Participant, as joint tenants with rights of survivorship or as tenants by the
entireties, to the extent permitted by applicable law, provided that such
designation is not treated as a disposition under the Code.

                  Section 10.3 Restrictions on Exercise. The Committee may, in
its discretion, require as conditions to the exercise of any option that the
Shares due to be delivered upon the exercise of such option shall have been duly
listed, upon official notice of issuance, upon a stock exchange or market, and
that a registration statement under the Securities Act of 1933, as amended (the
"Securities Act"), with respect to said Shares shall be effective.

                                   ARTICLE XI

                                 ADMINISTRATION

                  Section 11.1 Administration.

                  (a) The Plan shall be administered by the Committee. The
Committee shall operate in accordance with the charter setting out the terms of
reference and rules of procedure for the Leadership Development and Compensation
Committee (formerly the Compensation Committee) established 31 May 2002. If the
Board determines that another Committee will administer the Plan, it will
determine the terms of reference and procedures to apply to such Committee.

                  (b) Subject to the provisions of the Plan and the specific
duties delegated by the Board to the Committee, the Committee may delegate, to
any executive or other delegate of the Company (any such person, a "Plan
Administrator"), the following authority:

                  (i) to determine the Fair Market Value of Shares in accordance
with Section 2.9 and the option price in accordance with Section 6.2 of the
Plan;

                  (ii) to determine whether and to what extent options are
granted;

                  (iii) to approve forms of agreement for use under the Plan;

                  (iv) to construe and interpret the terms of the Plan;

                  (v) to prescribe, amend and rescind rules and regulations
relating to the Plan; and

                  (vi) to make all other determinations deemed necessary or
advisable for administering the Plan.

                  Section 11.2 Interpretation. The Committee shall have full
power and authority to interpret the provisions of the Plan and any agreement
evidencing options granted under the Plan, to administer the Plan in all
jurisdictions in which the Plan is effective or where there are Participants who
are participating in the Plan, to determine how and as of what date any
currencies other than United States dollars will be converted into United States
Dollars, and to determine any and all questions arising under the Plan. The
Committee's decisions shall be final and binding on all Participants in or other
persons claiming under the Plan.

                  Section 11.3 Indemnity. No member of the Board or the
Committee shall be liable for any action or determination made in good faith
with respect to the Plan or any option granted under it. The Company shall
indemnify each member of the Board and the Committee to the fullest extent
permitted by law with respect to any claim, loss, damage or expense (including
counsel fees) arising in connection with their responsibilities under this Plan.

                                   ARTICLE XII

                                  MISCELLANEOUS

                  Section 12.1 Designation of Beneficiary. Where permitted by
local law, a Participant may file a written designation of a beneficiary who is
to receive the Shares and cash, if any, credited to the Participant's memorandum
account under the Plan in the event of the Participant's death subsequent to an
Exercise Date on which the option is exercised but prior to the delivery to such
Participant of such Shares and cash. In addition, where permitted by local law,
a Participant may file a written designation of a beneficiary who is to receive
any cash that has been

credited to the Participant's memorandum account under the Plan in the event of
the Participant's death prior to the exercise of the option; provided, however,
in no event shall such beneficiary be entitled to authorize the exercise of such
option. In the event of the death of a Participant and in the absence of a
beneficiary validly designated under the Plan who is living at the time of such
Participant's death, or where the designation of a beneficiary is unlawful, the
Company shall deliver any Shares or cash credited to the Participant's
memorandum account to the executor or administrator of the estate of the
Participant.

                  Section 12.2 Non-Transferability. Neither payroll deductions
credited to any Participant's memorandum account nor any option or rights with
regard to the exercise of an option or the right to receive Shares under the
Plan may be assigned, transferred, pledged, or otherwise disposed of in any way
by the Participant, other than by will or the laws of descent and distribution.
Any such attempted assignment, transfer, pledge or other disposition shall be
without effect, except that the Designated Company, may, in its discretion,
treat such act as an election to withdraw from participation in the Plan in
accordance with Section 8.1.

                  Section 12.3 Use of Funds. All payroll deductions received or
held by a Designated Company, under the Plan may be used by the Designated
Company for any corporate purpose. The Designated Company shall not be obligated
to segregate such payroll deductions. At all times prior to an Exercise Date,
Participants' rights hereunder shall be equivalent to those of a general
unsecured creditor.

                  Section 12.4  Changes in Capitalization.

                  (a) If, while any options are outstanding under the Plan, the
outstanding Shares of the Company have increased, decreased, changed into, or
been exchanged for a different number or kind of shares or securities of the
Company through any reorganization, merger, recapitalization, reclassification,
stock split, reverse stock split or similar transaction, appropriate and
proportionate adjustments may be made by the Committee in the number and/or kind
of shares which are subject to purchase under outstanding options and in the
Option Price or Prices applicable to such outstanding options and in the number
and/or kind of shares which may be offered in the Offering Periods described in
Section 4.2. No such adjustments shall be made for dividends payable in cash.

                  (b) Upon the dissolution or liquidation of the Company, or
upon a reorganization, merger or consolidation of the Company with one or more
corporations as a result of which the Company is not the surviving corporation
or survives only as a wholly owned subsidiary, or upon a sale of substantially
all of the property or capital stock of the Company to another corporation, the
Committee shall provide either (i) that notwithstanding anything to the contrary
in Section 4.2, the Offering Period that last commenced prior to the effective
date of such transaction will end, and the Exercise Date for such Offering
Period will occur, either on the last business day or such earlier date as
determined in the sole discretion of the Committee before the effective date of
such transaction, or (ii) that the holder of each option then outstanding under
the Plan will thereafter be entitled to receive at the next Exercise Date, upon
the exercise of such option, for each Share as to which such option shall be
exercised, as nearly as reasonably may be determined, the cash, securities
and/or property which a holder of one Share was entitled to receive upon and at
the time of such transaction. The Board shall take such steps in connection with
such transactions as the Board shall deem necessary to assure that the
provisions of this Section 12.4(b) shall thereafter be applicable, as nearly as
reasonably may be determined, in relation to said cash, securities and/or
property as to which each such holder of any such option might hereafter be
entitled to receive.

                  Section 12.5 Governmental Regulation. The Company's obligation
to sell and deliver Shares under this Plan is subject to the approval of any
governmental authority required in connection with the authorization, issuance
or sale of such Shares.

                  Section 12.6  Amendment.

         (a) Amendments in General. The Board may amend, modify or alter the
Plan by resolution at any time provided that (i) no amendment may be made that
would adversely affect the right of a Participant to his payroll deductions as
of the date of such amendment, and (ii) subject to 12.6(b) no amendment,
modification or alteration may be made to Articles III, IV or VI or Sections
5.1, 8.3 or 9.1 of the Plan to the advantage of Participants without the prior
approval of the shareholders of the Company in general meeting.

         (b) Minor Amendments. The Board may, by resolution, make minor
amendments to benefit the administration of the Plan, to take account of a
change in legislation or to obtain or maintain favourable tax, exchange control
or regulatory treatment for Participants, the Company or any Subsidiaries
without being required to seek the sanction of shareholders of the Company in
general meeting pursuant to Section 12.6(a)(ii).

         Section 12.7 Termination. The Board may terminate the Plan at any time,
provided that no termination will adversely affect the right of a Participant to
his or her payroll deductions as of the date of such termination.

                  Section 12.8 Effective Date. The Plan shall become effective
as of January 1, 2005, having been approved by shareholders at the annual
general meeting of the Company on June 16, 2004.

                  Section 12.9 Right to Terminate Employment. Nothing in the
Plan or in the agreement evidencing any award granted under the Plan shall
confer upon any Participant the right to continue as an employee or a director
of the Company or any Subsidiary or affect the right of the Company or any of
its Subsidiaries to terminate the Participant's employment at any time, subject,
however, to the provisions of any agreement of employment between the
Participant and the Company, or any of its Subsidiaries.

                  Section 12.10 Transfer, Leave of Absence. For purposes of this
Plan, neither a transfer of an Employee from the Company to a Subsidiary of the
Company, or vice versa, or from one Subsidiary of the Company to another, shall
be deemed a termination of employment.

                  Section 12.11 Effect of Plan. The provisions of the Plan
shall, in accordance with its terms, be binding upon, and inure to the benefit
of, all successors of each Participant in the Plan, including, without
limitation, such Participant's estate and the executors, administrators or
trustees thereof, heirs and legatees, and any receiver, trustee in bankruptcy or
representative of creditors of such Participant.

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