S-3

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As filed with the Securities and Exchange Commission on June 4, 2002.

Registration No. 333-          

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

GENCORP INC.
(Exact name of registrant as specified in its charter)

Ohio	34-0244000
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

GenCorp Inc.
Highway 50 and Aerojet Road
Rancho Cordova, California
95853-7012
(916) 355-4000
(Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)
(Registrant's telephone number, including area code)

William R. Phillips
Senior Vice President,
Law, General Counsel and Secretary
GenCorp Inc.
P.O. Box 537012
Sacramento, California 95853-7012
(916) 355-4000
(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copy to:

CHRISTOPHER M. KELLY	TIMOTHY J. MELTON
Jones, Day, Reavis & Pogue	Jones, Day, Reavis & Pogue
North Point	77 West Wacker Drive
901 Lakeside Avenue	Chicago, Illinois 60601-1692
Cleveland, Ohio 44114-1190	(312) 782-3939
(216) 586-3939

Approximate date of commencement of proposed sale to the public:
From time to time after this Registration Statement becomes effective.

        If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. o

        If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. ý

        If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

        If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

        If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. o

CALCULATION OF REGISTRATION FEE

Title of securities to be registered	Amount to be registered	Proposed maximum offering price per security(1)	Proposed maximum aggregate offering price	Amount of Registration Fee
53/4% Convertible Subordinated Notes	$150,000,000	$1,091.25	$163,687,500	$15,060
Common Stock, par value $.10 per share and associated rights(2)(3)	8,143,320 shares	$—	—	$—

(1)

Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(c) under the Securities Act, based on the average of the bid and asked prices of the notes on the PORTAL System on May 29, 2002 of $1,091.25 per $1,000 aggregate principal amount at maturity of the notes.

(2)

Also being registered are 8,143,320 shares of common stock issuable upon conversion of the notes based on an initial conversion price of $18.42 per share and an indeterminate number of shares of common stock issuable upon conversion of the notes in connection with a stock split, stock dividend, recapitalization or similar event. Pursuant to Rule 457 (i) under the Securities Act of 1933, no additional registration fee is required in connection with the registration of the common stock issuable upon conversion of the notes.

(3)

Also being registered are rights to purchase shares of Series A Cumulative Preference Stock, which are attached to the shares of common stock being registered. These rights, if issued, will be issued for no additional consideration. Pursuant to Rule 457(g), no additional registration fee is required in connection with the registration of the rights.

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this prospectus is not complete and may be changed. The selling securityholders may not sell or offer these securities until the registration statement filed with the Securities and Exchange Commission is declared effective. This prospectus is not an offer to sell these securities, and neither we nor the selling securityholders are soliciting an offer to buy these securities in any state where the offer and sale is not permitted.

SUBJECT TO COMPLETION, DATED JUNE 4, 2002

PROSPECTUS

$150,000,000
5³/4% Convertible Subordinated Notes due 2007

We sold $150,000,000 aggregate principal amount of our 5³/4% Convertible Subordinated Notes due 2007 in private transactions on April 5, 2002 and April 17, 2002. Selling securityholders may use this prospectus to resell from time to time their notes and the shares of common stock issuable upon conversion of the notes, including the rights attached to the common stock as described in "Description of Capital Stock."

The Convertible Notes

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Interest is payable on the convertible notes on each April 15 and October 15 and the notes will mature on April 15, 2007, unless previously redeemed or purchased.



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You may convert the notes into our common stock at any time on or after July 16, 2002 and before April 14, 2007, or the earlier redemption or repurchase of the notes, at an initial conversion price of $18.42 per share, subject to adjustment in some circumstances.



•

At any time on or after April 22, 2005, we may redeem some or all of the notes at the redemption prices listed in this prospectus, plus accrued and unpaid interest, if any, to the redemption date if the closing price of our common stock exceeds 125% of the conversion price then in effect for at least 20 trading days within a period of 30 consecutive trading days ending on the trading day before the mailing of the optional redemption notice.



•

You may require us to repurchase the notes upon a change of control at a price in cash equal to 100% of the principal amount of the notes to be repurchased, plus accrued and unpaid interest, if any, to the date of repurchase.



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The notes are general unsecured obligations and rank junior in right of payment to all of our other existing and future senior debt, including all of our obligations under our senior credit facilities.



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The notes are effectively subordinated to any secured debt and to any and all debt, including trade debt, of our subsidiaries. The indenture governing the notes does not restrict the incurrence of indebtedness by us or our subsidiaries.



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The notes issued in the initial private placement are eligible for trading in the PORTAL System. The notes sold using this prospectus, however, will no longer be eligible for trading in the PORTAL System. We do not intend to list the notes on any other national securities exchange or automated quoting system.

The Common Stock

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Our common stock is listed on the New York Stock Exchange and the Chicago Stock Exchange under the symbol "GY."



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On May 31, 2002, the last reported sale price of our common stock was $14.60.

Investing in the notes and the common stock issuable upon their conversion involves certain risks. See "Risk Factors" beginning on page 5.

The securities offered hereby have not been approved or recommended by the Securities and Exchange Commission or any state securities commission or regulatory authority. Furthermore, the foregoing authorities have not confirmed the accuracy or determined the adequacy of this document. Any representation to the contrary is a criminal offense.

The date of this prospectus is              , 2002.

TABLE OF CONTENTS

	Page
Summary	1
Risk Factors	5
Note Regarding Forward-Looking Statements	21
Ratio of Earnings to Fixed Charges	22
Use of Proceeds	23
Price Range of Common Stock and Dividend Policy	24
Capitalization	25
Description of Notes	26
Description of Capital Stock	38
Important United States Federal Tax Considerations	42
Selling Securityholders	48
Plan of Distribution	50
Legal Matters	51
Experts	52
Where You Can Find More Information and Incorporation by Reference	52

        This prospectus does not constitute an offer of, or an invitation to purchase, any of the notes or the common stock issuable upon their conversion in any jurisdiction in which, or to any person to whom, such offer or invitation would be unlawful. You should assume that the information in this prospectus is accurate only as of the date on the front of the document and that any information we have incorporated by reference is accurate only as of the date of the document incorporated by reference. Neither the delivery of this prospectus nor any sale of the notes shall, under any circumstances, create any implication that there has been no change in the affairs of GenCorp after the date of this prospectus.

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PROSPECTUS SUMMARY

This summary highlights key information contained elsewhere in, or incorporated by reference into, this prospectus. This summary is not complete and does not contain all of the information that may be important to you. You should read this entire prospectus carefully, including "Risk Factors" and the financial information, which appears elsewhere in, or is incorporated by reference into, this prospectus.

Our fiscal year ends on November 30 of each year. When we refer to a fiscal year, such as fiscal 2001, we are referring to the fiscal year ended on November 30 of that year. In December 2000, we acquired the Draftex International Car Body Seals Division of The Laird Group plc. The Draftex business is now part of our GDX Automotive segment. Draftex's fiscal year historically ended on December 31 of each year, but now ends on November 30 of each year, beginning with the fiscal year ended November 30, 2001.

Our Company

        We are a manufacturing and engineering company that is a leader in providing design solutions and products for the aerospace and defense market and the automotive vehicle sealing market. In addition, we supply both registered intermediates and final active pharmaceutical ingredients to pharmaceutical and biotechnology customers. Our operations are grouped into three operating segments:

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aerospace and defense;

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GDX Automotive; and

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fine chemicals.

Our aerospace and defense segment, which we operate as Aerojet-General Corporation, and refer to as Aerojet, develops and manufactures propulsion systems, both solid and liquid, for space and defense applications and armament systems for precision tactical weapons systems and munition applications. Our GDX Automotive segment designs and manufactures highly engineered automotive vehicle sealing systems for motor vehicle bodies and doors. Our fine chemicals segment manufactures fine chemical ingredients and active pharmaceutical ingredients, with a special emphasis on producing chemicals that are difficult to manufacture and that are used in therapeutic products and applications in areas such as oncology, anti-viral, arthritis, AIDS, neurology and anti-inflammatory treatments.

        We also own substantial amounts of undeveloped real property located in high-growth areas in Northern and Southern California. We have recently increased our focus on these sizable land holdings with the objective of maximizing the financial and business opportunities that we believe exist for these valuable assets. Approximately 2,600 contiguous acres of our land located near Sacramento were recently carved out from existing Superfund site designation. This land is situated in a high growth area along a major highway and has already been zoned for light industrial and commercial use. As a result, the carve-out represents a key initiative in our evolving strategy to maximize the value of our real estate.

Recent Developments

        On May 9, 2002, the United States District Court for the Northern District of Ohio issued a memorandum opinion stating that final judgment in the Olin Corporation v. GenCorp Inc. case, which relates to liability for certain Superfund remediation costs associated with a former Olin manufacturing facility and waste disposal site in Ashtabula County, Ohio and which is discussed in more detail in our Annual Report on Form 10-K for the year ended November 30, 2001, will be entered in Olin's favor in the amount of $19 million, plus prejudgment interest running from October 7, 1993 or the date the expenditure was actually made, whichever is later. The parties have until June 8, 2002

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to reach an agreement on the amount of prejudgment interest. If an agreement cannot be reached, the parties have until June 23, 2002 to submit their own calculations to the court. The court had previously ruled that Olin was obligated to insure us for any liability that we may incur in connection with the case. That insurance has been procured and we believe that the court did not properly address the insurance issue in the memorandum opinion. Therefore, we plan to seek a timely reconsideration of the memorandum opinion with respect to Olin's obligation to insure us for the amount of this judgment.

        In September 2001, we sold our electronic and information systems business to Northrop Grumman. The purchase price was subject to adjustment. On April 24, 2002, we entered into an agreement with Northrop Grumman Systems Corporation under which we agreed to pay Northrop Grumman an additional $6 million as an adjustment to the purchase price. We will make this payment in two installments, with the first payment scheduled for September 15, 2002 and the second scheduled for December 15, 2002.

        In January 2002, we became aware of potential accounting issues at two GDX manufacturing plants in North America. After an inquiry, we restated our previously issued financial statements for the first three quarters of fiscal 2001 and for the years ended November 30, 2000 and November 30, 1999, as described in more detail in our Annual Report on Form 10-K for the year ended November 30, 2001. Unless otherwise expressly stated, all financial information contained in or incorporated by reference into this prospectus reflects the restatement.

        Our principal executive offices are currently located at Highway 50 and Aerojet Road, Rancho Cordova, California 95670. Our mailing address is P.O. Box 537012, Sacramento, California 95853-7012 and our telephone number is (916) 355-4000. We maintain a website at www.gencorp.com. However, we do not intend that the information available through our website be incorporated into this prospectus.

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The Offering

Securities Offered	$150,000,000 in aggregate principal amount of 53/4% Convertible Subordinated Notes due 2007.
Maturity Date	April 15, 2007.
Interest Payment Dates	April 15 and October 15, commencing October 15, 2002.
Ranking	The notes are our general unsecured subordinated obligations and rank junior in right of payment to all of our other existing and future senior debt, including obligations under our senior credit facilities. In addition, the notes are effectively subordinated to any secured debt and to any and all debt and other liabilities, including trade debt, of our subsidiaries. As of February 28, 2002, after giving pro forma effect to the sale of the notes and the application of the net proceeds:
	•	we would have had approximately $91 million of senior debt outstanding to which the notes would have been expressly subordinated; and
	•	our subsidiaries would have had approximately $716 million of debt and other liabilities outstanding, including trade debt but excluding pension liabilities, to which the notes would have been effectively subordinated.
	The indenture does not restrict our ability to incur additional debt, some or all of which may be senior in right of payment to the notes. The indenture also does not restrict the ability of our subsidiaries to incur additional indebtedness or other liabilities that would be effectively senior to the notes.
Conversion Rights	The notes are convertible into shares of our common stock at an initial conversion price of $18.42. The conversion price is subject to adjustment under some circumstances as described in this prospectus.
Sinking Fund	None.
Optional Redemption	We may redeem some or all of the notes at any time on or after April 22, 2005, at the redemption prices set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date if the closing price of our common stock exceeds 125% of the conversion price then in effect for at least 20 trading days within a period of 30 consecutive trading days ending on the trading day before the day of the mailing of the optional redemption notice.
Repurchase Right of Holders Upon A Change of Control	You may require us to repurchase the notes upon a change of control at a price equal to 100% of the principal amount of the notes to be repurchased, plus accrued and unpaid interest, if any, to the date of repurchase. The repurchase price is payable in cash.

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Use of Proceeds

We will not receive any proceeds from the sale by any selling securityholder of the notes or the common stock issuable upon conversion.

Trading

The notes sold in the initial private placement are eligible for trading in the PORTAL system. The notes sold using this prospectus, however, will no longer be eligible for trading in the PORTAL system. We do not intend to list the notes on any other national securities exchange or automated quotation system. Our common stock is traded on the New York Stock Exchange and the Chicago Stock Exchange under the symbol "GY."

Risk Factors

        You should carefully consider the information set forth in the section of this prospectus entitled "Risk Factors" as well as the other information provided to you in, or incorporated by reference into, this prospectus before deciding whether to invest in the notes.

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RISK FACTORS

An investment in the notes represents a high degree of risk. There are a number of factors, including those specified below, which may adversely affect our ability to make payments on the notes or lead to a decline in the value of our common stock. Additional risks that we do not know about or that we currently view as immaterial may also impair our business or adversely impact our ability to repay the notes or lead to a decline in the value of our common stock. We may also, from time to time, discuss additional risks or update those discussed below in our filings with the Securities and Exchange Commission that are incorporated by reference into this prospectus. You should carefully consider the risks described below together with the other information contained in, or incorporated by reference into, this prospectus before making a decision to invest in the notes.

Risks Related to GenCorp

We have a substantial amount of debt, and the cost of servicing that debt could adversely affect our business and hinder our ability to make payments on the notes and may lead to a decline in the value of our common stock.

        We have a substantial amount of indebtedness. As of February 28, 2002, after giving pro forma effect to the initial sale of the notes in April 2002 and the application of the net proceeds, we would have had total consolidated debt of approximately $250 million. For the year ended November 30, 2001, giving pro forma effect to the sale of our electronic and information systems business, the acquisition of Draftex, the initial sale of the notes in April 2002 and the application of the net proceeds from those sales, our earnings would have been insufficient to cover fixed charges by approximately $56 million. Subject to the limits contained in our senior credit facilities, we may incur additional debt in the future.

        In addition to the interest payable on the notes, we have other demands on our cash resources including, among others, operating expenses and interest and principal payments under our senior credit facilities. Our level of indebtedness and these significant demands on our cash resources could have important effects on your investment in the notes and may lead to a decline in the value of our common stock. For example they could:

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make it more difficult for us to satisfy our obligations with respect to the notes and our senior credit facilities;



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require us to dedicate a substantial portion of our cash flow from operations to payments on our debt, thereby reducing the amount of our cash flow available for working capital, capital expenditures, acquisitions and other general corporate purposes;



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limit our flexibility in planning for, or reacting to, changes in the industries in which we compete;



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place us at a competitive disadvantage compared to our competitors, some of which have lower debt service obligations and greater financial resources than we do;



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limit our ability to borrow additional funds;



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increase our vulnerability to general adverse economic and industry conditions; and/or



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result in our failure to satisfy the financial covenants contained in our senior credit facilities or in other agreements governing our indebtedness, which, if not cured or waived, could have a material adverse effect on our business, financial condition, results of operations and ability to make payments on the notes.

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        Our ability to make required payments on the notes and our senior credit facilities and satisfy our other liabilities will depend upon our future operating performance and our ability to refinance our debt as it becomes due. Our future operating performance and ability to refinance will be affected by prevailing economic conditions at that time and financial, business and other factors, many of which are beyond our control.

        If we are unable to service our indebtedness and fund our operating costs, we will be forced to adopt alternative strategies that may include:

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reducing or delaying capital expenditures;



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seeking additional debt financing or equity capital;



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selling assets;



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restructuring or refinancing debt; or



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curtailing or eliminating certain activities.

        We cannot assure you that any such strategy could be implemented on satisfactory terms, if at all.

Our debt agreements will restrict our ability, and the ability of some of our subsidiaries, to engage in particular activities.

        The agreements governing our senior credit facilities limit or prohibit us or our subsidiaries of our subsidiaries from engaging in particular transactions and activities. Our senior credit facilities also contain financial covenants that will require us to achieve certain financial and operating results and maintain compliance with specified financial ratios. These covenants could limit our ability to obtain future financing and may prevent us from taking advantage of attractive business opportunities. Our ability to meet these covenants or requirements may be affected by events beyond our control, and we cannot assure you that we will satisfy such covenants and requirements. A breach of these covenants or our inability to comply with the financial ratios, tests or other restrictions could result in an event of default under our senior credit facilities and/or the indenture relating to the notes. Upon the occurrence of an event of default under our senior credit facilities, the lenders could elect to declare all amounts outstanding under our senior credit facilities, together with accrued interest, to be immediately due and payable. If we were unable to repay those amounts, the lenders could proceed against our and our subsidiaries' assets granted to them as collateral to secure the indebtedness. If the lenders under our senior credit facilities accelerate the payment of the indebtedness, the subordination provisions of the indenture would apply and we cannot assure you that our assets and those of the guarantors would be sufficient to repay in full the accelerated indebtedness and our other indebtedness, including the notes.

We are a holding company and therefore depend on our subsidiaries in order to service our debt.

        Although we operate a portion of our North American GDX Automotive operations directly, the remainder of our operations, including all of the operations of our aerospace and defense and fine chemicals segments, as well as the European and Canadian portions of our GDX Automotive operations, are conducted through subsidiaries. Consequently, our cash flow and ability to service our debt obligations, including the notes, are largely dependent upon the earnings of our operating subsidiaries and the distribution of those earnings to us, or upon loans, advances or other payments made by these subsidiaries to us. The ability of our subsidiaries to pay dividends or make other payments or advances to us will depend upon their operating results and will be subject to applicable laws and contractual restrictions contained in the instruments governing their debt, including our

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senior credit facilities. We cannot assure you that the earnings of our operating subsidiaries, and their ability to make dividend or other payments to us, will be adequate for us to service our debt obligations, including the notes.

We may experience product failures, schedule delays or other problems with existing or new products and systems, all of which could adversely impact our business.

        Many of the products we develop and manufacture are technologically advanced systems that must function under demanding operating conditions, particularly in our aerospace and defense segment. Even though we believe we employ sophisticated design, manufacturing and testing processes and practices, we cannot assure you that we will successfully launch or operate our products or that they will be developed or will perform as intended. Some of our contracts require us to forfeit a portion of our expected profit, receive reduced payments, provide a replacement product or service or reduce the price of subsequent sales to the same customer if our products fail to perform adequately. Performance penalties also may be imposed should we fail to meet delivery schedules or other measures of contract performance.

        We have experienced occasional product failures and other problems with our rocket propulsion systems. We may experience product and service failures, schedule delays and other problems in connection with our propulsion systems or other products in the future. In addition to any costs resulting from product warranties, contract performance or required remedial action, such failures may result in increased costs or loss of sales due to postponement or cancellation of subsequently scheduled launches or other product and service deliveries.

        Our fine chemicals segment produces chemicals that are difficult to manufacture, including chemicals that are highly energetic and toxic. The production of these chemicals requires a high degree of precision and strict adherence to safety standards. The U.S. Food and Drug Administration must approve the production process for many of the products that our fine chemicals segment manufactures. In the past, we have experienced delays in obtaining approval for the production processes for certain products. These delays have negatively impacted the historical financial results of this business. If these types of delays were to occur in the future, the results for our fine chemicals segment and our overall operations could be adversely affected.

        We do not generally insure against potential costs resulting from any required remedial actions or costs or loss of sales due to postponement or cancellation of subsequently scheduled operations or product deliveries.

Our inability to adapt to rapid technological change could impair our ability to remain competitive.

        The aerospace and defense and the fine chemicals industries have undergone rapid and significant technological development over the last few years. The automotive vehicle sealing industry has also experienced significant changes in the fields of noise attenuation and alternative sealing materials, particularly in Europe. Our success in each of our business segments depends on our ability to maintain our market position with existing customers, generate sales from new sources and continue to conceive, design, manufacture and market new products and services on a cost-effective and timely basis. We anticipate that we will continue to incur significant expenses in the design and initial manufacturing and marketing of new products and services. Our competitors may implement new technologies before we are able to, allowing them to provide more effective products at more competitive prices. Future technological developments could:

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adversely impact our competitive position if we are unable to react to these developments in a timely or efficient manner;

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require us to write-down obsolete facilities, equipment and technology;



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require us to discontinue production of obsolete products before we can recover any or all of our related research, development and commercialization expenses; or



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require significant capital expenditures beyond those currently contemplated.

        We cannot assure you that we will be able to achieve the technological advances necessary to remain competitive and profitable, that new products and services will be developed and manufactured on schedule or on a cost-effective basis, that anticipated markets will exist or develop for new products or services or that our existing products and services will not become technologically obsolete. Competition may grow more intense as industry-wide technological progress accelerates and more money is invested in new products or processes. In addition, we may incur significant costs associated with launching products employing new technology, including costs associated with scaling up our operations and transitioning from research and development to full production.

We may not be able to consummate or effectively integrate acquisitions, and our results may be adversely affected.

        Our business strategy contemplates continued expansion of our operations, including growth through future acquisitions. However, our ability to consummate and integrate effectively any future acquisitions on terms that are favorable to us may be limited by the number of attractive acquisition targets, internal demands on our resources and our ability to obtain financing. Our success in integrating newly acquired businesses will depend upon our ability to retain key personnel, avoid diversion of management's attention from operational matters, integrate general and administrative services and key information processing systems and, where necessary, to requalify on customer programs. In addition, future acquisitions could result in the incurrence of additional debt, costs and contingent liabilities, all of which could have a material adverse effect on our business, financial condition or results of operations. We may also incur costs and divert management attention for acquisitions which are never consummated. Integration of acquired operations may also take longer, or be more costly or disruptive to our business, than originally anticipated. It is also possible that expected synergies from past or future acquisitions may not materialize.

        Although we undertake a diligence investigation of each business that we acquire, there may be liabilities of the acquired companies that we fail or are unable to discover during the diligence investigation and for which we, as a successor owner, may be responsible. In connection with acquisitions, we generally seek to minimize the impact of these types of potential liabilities through indemnities and warranties from the seller, which may in some instances be supported by deferring payment of a portion of the purchase price. However, these indemnities and warranties, if obtained, may not fully cover the liabilities due to limitations in scope, amount or duration, financial limitations of the indemnitor or warrantor or other reasons.

The loss of significant customers could materially adversely affect our business, thereby making it more difficult to make payments on the notes and leading to a decline in the value of our common stock.

        In fiscal 2001, our largest customer in our aerospace and defense segment was the U.S. Government and its agencies, which accounted for approximately 90% of net segment sales and 39% of our total net sales. The two largest customers in our GDX Automotive segment were General Motors and Ford. In fiscal 2001, General Motors accounted for approximately 32% of net segment sales and Ford accounted for approximately 23% of net segment sales. In our fine chemicals segment, we rely on a limited number of customers, as well as a limited number of products. For

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fiscal 2001, a single customer accounted for 52% of net segment sales and the top five customers accounted for 94% of net segment sales.

        A significant decrease or interruption in business from one or more significant customers could have a material adverse effect on the particular segment affected as well as on our overall business, thereby making it more difficult for us to make payments on the notes and leading to a decline in the value of our common stock.

A loss of key personnel or highly skilled employees could adversely affect our business.

        Many of our executive officers are critical to the management and direction of our businesses. Our future success depends, in large part, on our ability to retain these officers and other capable management personnel. In general, we do not enter into employment agreements with our executive officers. In addition, we have entered into severance agreements with several of our officers that allow those officers to terminate their employment under particular circumstances, such as a change of control affecting our company. Although we believe we will be able to attract and retain talented personnel and replace key personnel should the need arise, our inability to do so could have a material adverse effect on our business, financial condition or results of operations. In addition, because of the complex nature of many of our products and programs, we are generally dependent on an educated and highly skilled workforce. We would be adversely affected by a shortage of available skilled employees.

A strike or other work stoppage, or our inability to renew collective bargaining agreements on favorable terms, could adversely affect our business.

        As of November 30, 2001, approximately 60% of our employees were covered by collective bargaining or similar agreements. Of the covered employees, approximately 7% were covered by collective bargaining agreements that are due to expire in 2002. Our inability to negotiate acceptable new agreements with the unions representing our employees upon expiration of the existing contracts could result in strikes or work stoppages. Even if we are successful in negotiating new agreements, the new agreements could call for higher wages or benefits paid to union members, which would increase our operating costs and could adversely affect our profitability. During fiscal 1998, our GDX Automotive segment experienced a work stoppage at its Batesville, Arkansas facility that adversely affected its and our results of operations for fiscal 1998. If our unionized workers were to engage in a strike or other work stoppage, or other non-unionized operations were to become unionized, we could experience a significant disruption of our operations or higher ongoing labor costs, which could have a material adverse effect on our business, financial condition or results of operations. A strike or other work stoppage in the facilities of any of our major customers could also have similar effects on us. In particular, the automotive industry is generally highly unionized and some of our customers have, in the past, experienced significant labor disruptions. For example, our results of operations for the third quarter of fiscal 2001 were negatively impacted by a two-week strike at a Volkswagen plant in Puebla, Mexico.

Our customers operate in industries that are cyclical in nature, which can lead to significant variability in our operating results.

        A majority of our sales are derived from customers that are in industries and businesses that are cyclical in nature and subject to changes in general economic conditions, such as the aerospace and defense and automotive industries. General economic or industry specific downturns, or a prolonged disruption in production by one or more of our significant customers, including any such downturns or disruptions occasioned by unforeseen events could have a negative impact on the market for our products and, therefore, could have a material adverse effect on our business, financial condition or results of operations.

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We rely on intellectual property and proprietary rights to maintain our competitive position and, therefore, our failure to adequately protect our intellectual property and proprietary rights could adversely affect our business.

        The technological and creative skills of our personnel and our innovative product developments are essential to establishing and maintaining our technology leadership position. We seek to protect our inventions, confidential information, brand names and works of authorship under patent and "trade secret" laws, and through the use of confidentiality procedures and written agreements. However, these laws and our efforts afford only limited protection to our intellectual property and proprietary rights, and we cannot assure you that the same will be successfully protected, or that, if protected, our rights will not be invalidated, circumvented or challenged by our competitors or other third parties. With respect to pending or future patent applications, we cannot assure you that they will be issued with the scope of the claims we have sought, if at all. Furthermore, third parties may develop technologies that are similar or superior to our technology or design around our intellectual property. Despite our efforts to protect our intellectual property and proprietary rights, unauthorized parties may attempt to copy aspects of our products or to obtain and use information that we regard as proprietary. In addition, the laws of some foreign countries do not ensure that our means of protecting our proprietary rights in the United States or abroad will be adequate or that our competitors will not independently develop similar technology for which we have no patent. Moreover, on certain U.S. Government research and development contracts, the U.S. Government retains right to certain of the intellectual property. Our failure to protect adequately our intellectual property and proprietary rights could have a material adverse effect on our business, financial condition and results of operations.

We may incur liability for infringing the intellectual property rights of others.

        Each of our business groups has used, and intends to use in the future, new technology in our various design and manufacturing processes. We cannot assure you that our products do not and will not be alleged to infringe upon issued patents, pending patent applications or other intellectual property rights of third parties that may relate to our products. For example, in our fine chemicals segment we are aware of the existence of three patents that could impact our right to utilize a key technology. Although we have received an opinion from legal counsel that one of these patents is invalid and that our technology does not infringe upon the other two patents, we cannot assure you that one or more of the parties that hold these patents will not bring an action for patent infringement against us. This and other potential claims, and any resulting litigation, could subject us to significant liability for damages. In addition, even if we prevail, intellectual property litigation could be time consuming and expensive to defend and could result in the diversion of our time and attention from the management and operation of our various businesses. Any claims from third parties may also result in limitations on our ability to use the intellectual property subject to these claims unless we are able to enter into agreements with the third parties making these claims. The result of any such agreement is likely to be an increase in our product costs in the way of additional royalty payments or other fees.

Our operations and properties are currently the subject of significant environmental claims, and the numerous environmental and other government regulations to which we are subject may become more stringent in the future and may result in increased liability and increased capital expenditures.

        Our operations and ownership or use of real property are subject to a number of foreign, federal, state and local environmental laws and regulations that, among other things, require us to obtain permits to operate and to install pollution control equipment and regulate the generation, storage, handling, transportation, treatment and disposal of hazardous and solid wastes. Our operations also

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subject us to liability for the cleanup of releases of hazardous substances. The laws and regulations affect not only our current operations, but also could impose liability on us for past operations that were conducted in compliance with then-applicable laws and regulations. Environmental laws and regulations change frequently, and we anticipate that these laws and regulations will become increasingly stringent. It is difficult to predict whether and to what extent compliance with environmental laws and regulations may impact our results of operations or financial condition in the future.

        Due to the nature of our operations, particularly our aerospace and defense operations, we are involved from time to time in legal proceedings involving remediation of environmental contamination from past or present operations or use or ownership of real property, as well as compliance with environmental requirements applicable to ongoing operations. We may also be subject to fines and penalties, toxic tort suits or other third-party lawsuits due to our or our predecessors' present or past use of hazardous substances or the alleged on-site or off-site contamination of the environment through past or present operations. We could incur material costs or liabilities in connection with any such proceedings or claims. In fiscal 2001, we incurred costs of $75 million relating to the remediation of environmental contamination, the settlement of environmental claims and general environmental compliance efforts, including $40 million placed into escrow for the San Gabriel Valley BPOU settlement agreement, which is described in our Annual Report on Form 10-K for the year ended November 30, 2001. The nature of environmental investigation and cleanup activities often makes it difficult to determine the timing and amount of any estimated future costs that may be required for remedial measures.

        We are currently involved, together with other companies, in approximately 30 Superfund and non-Superfund remediation sites. Our liability and proportionate share of costs involving two sites in Sacramento, California and Azusa, California have not fully been determined largely due to uncertainties as to the nature and extent of site conditions and our involvement at those sites. Regarding other sites where we are one of numerous potentially responsible parties, while government agencies frequently claim potentially responsible parties are jointly and severally liable at such sites, in our experience, interim and final allocations of liability costs are generally made based on relative contributions of waste. Based on our previous experience, our allocated share has frequently been low, and, in many instances, has been less than 1%. We have established reserves of approximately $261 million as of February 28, 2002, which we believe are sufficient to cover our estimated share of the environmental remediation costs at these sites. Also, we are seeking recovery of our costs from our insurers. However, given the many uncertainties involved in assessing liability for environmental claims, we cannot provide you with any assurance that such reserve will be sufficient. In addition, the reserve is based only on known sites and the known contamination at those sites. It is possible that additional remediation sites will be identified in the future or that contamination at previously identified sites will be different than what is currently known.

        Under an agreement with the U.S. Government, the U.S. Government recognizes as allowable for government contract cost purposes up to 88% of the environmental expenses at the Sacramento and Azusa sites. Aerojet's mix of contracts can affect the actual reimbursement made by the U.S. Government. Actual reimbursements by the U.S. Government have averaged approximately 80% since 1999. Because these costs are recovered through forward pricing arrangements, our ability to continue to take advantage of this cost-recognition agreement is dependent on Aerojet's sustaining product volumes under U.S. Government contracts and programs and our ability to continue to perform under those contracts and programs.

        The nature of environmental investigation and cleanup activities often makes it difficult to determine the timing and amount of any estimated future costs that may be required for remedial measures. However, we review these matters and accrue for costs associated with the remediation of

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environmental pollution when it becomes probable that a liability has been incurred and the amount of the liability, usually based upon proportionate sharing, can be reasonably estimated.

        The effect of resolution of environmental matters on results of operations cannot be predicted due to the uncertainty concerning both the amount and timing of future expenditures and future results of operations. However, we believe, on the basis of presently available information, that resolution of these matters and our obligations for environmental remediation and compliance will not materially affect liquidity, capital resources or our consolidated financial condition. We will continue our efforts to mitigate past and future costs through pursuit of claims for insurance coverage and continued investigation of new and more cost effective remediation alternatives and associated technologies. For additional discussion of environmental matters, you should read our Annual Report on Form 10-K for the fiscal year ended November 30, 2001 and our other reports filed under the Exchange Act that are incorporated into this prospectus by reference.

Potential disruptions and liabilities arising from any release or explosion of dangerous materials could materially adversely affect our business, financial condition or results of operations.

        Our aerospace and defense and fine chemicals segments involve the handling and production of potentially explosive materials and other dangerous chemicals, including materials used in rocket propulsion and other products. This handling and/or production could result in incidents that temporarily shut down or otherwise disrupt our manufacturing, causing production delays. It is possible that a release of these chemicals or an explosion could result in death or significant injuries to employees and others. Material property damage to us and third parties could also occur. The use of these products in applications by our customers could also result in liability if an explosion or fire were to occur. Any release or explosion could expose us to adverse publicity or liability for damages or cause production delays, any of which could have a material adverse effect on our business, financial condition or results of operations.

We may have additional liability resulting from the restatement of our financials for the years ended November 30, 1999 and November 30, 2000.

        In January 2002, we became aware of potential accounting issues at two GDX manufacturing plants in North America. Under the direction and oversight of our audit committee and with the assistance of outside legal advisors and accounting consultants, we conducted an inquiry into these and related accounting issues as well as a more complete evaluation of accounting practices and internal control processes throughout GenCorp. As a result of this process, due primarily to activities at one GDX manufacturing plant, we restated our previously issued financial statements for the first three quarters of fiscal 2001 and for the years ended November 30, 2000 and November 30, 1999 as described in more detail in our Annual Report on Form 10-K for the year ended November 30, 2001. Because of this restatement, we may be subject to claims by third parties or inquiries by governmental agencies, which may impact our business, financial condition and operating results or the price of our common stock.

A significant percentage of our contracts are fixed priced contracts, and, if we experience cost overruns on these contracts, we would have to absorb the excess costs and our profitability would be adversely affected.

        Our contracts generally can be categorized as either "fixed price" or "cost protected" contracts. For fiscal 2001, on both an historical and pro forma basis, a substantial portion of our contracts were fixed price contracts. Under fixed price contracts, we agree to perform specified work for a fixed price and realize all the benefit or detriment resulting from decreases or increases in the costs of performing the contract. As a result, all fixed price contracts present the inherent risk of

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unreimbursed cost overruns. To the extent we were to incur unanticipated cost overruns on a program or platform subject to a fixed price contract, our profitability and, consequently, our financial condition and results of operations would be adversely affected.

Risks Related to Our Aerospace and Defense Segment

Our aerospace and defense segment is subject to various risks inherent in contracting with the U.S. Government, and a substantial decrease in or loss of government contracts would materially adversely affect our business, financial condition and results of operations, hinder our ability to make payments on the notes and lead to a decline in the value of our common stock.

        A substantial portion of our aerospace and defense sales is derived from U.S. Government contracts, and, consequently, we are subject to complex and extensive laws and regulations regarding procurement and data rights. These laws and regulations provide for ongoing audits and reviews of contract procurement, performance and administration and enumerate specific rights that the U.S. Government may have to use technical data and computer software. Our failure to comply, even inadvertently, with these laws and regulations and the laws governing the export of controlled products and commodities could subject us or one or more of our businesses to civil and criminal penalties and, under some circumstances, suspension and debarment from future government contracts and exporting of products for a specified period of time. Sales to the U.S. Government and its agencies accounted for approximately 90% of our aerospace and defense net segment sales and 39% of our total net sales in fiscal 2001.

        Government contracts and subcontracts are by their terms subject to termination by the government or the prime contractor either for convenience or default. The loss of a substantial portion of our government contract business would have a material adverse effect on our business and results of operations. There are significant inherent risks in contracting with the U.S. Government, including risks particular to the aerospace and defense industry, which could have a material adverse effect on our business, financial condition or results of operations. The primary risks include:

•

termination by the U.S. Government of any contract as a result of a default by us could subject us to liability for the excess costs incurred by the U.S. Government in procuring undelivered items from another source;



•

termination by the U.S. Government of any contract for convenience would generally limit our recovery to costs already incurred or committed and limit our profit to work completed prior to termination;



•

modification of U.S. Government contracts due to lack of congressional funding or changes in such funding could subject our contracts to termination or modification;



•

failure to comply, even inadvertently, with the extensive and complex U.S. Government laws and regulations applicable to certain U.S. Government contracts and the laws governing the export of controlled products and commodities could subject us to contract termination, civil and criminal penalties and, under certain circumstances, suspension and debarment from future U.S. Government contracts and exporting of products for a specific period of time;



•

results of U.S. Government audits and review could, in certain circumstances, lead to adjustments to our contract prices, which could be significant;



•

successful bids for U.S. Government contracts or the profitability of such contracts, if awarded, cannot be guaranteed in the light of the competitive bidding atmosphere under which U.S. Government contracts are awarded;

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•

the extent to which actual costs exceed projected costs on which our bids or contract prices were based could lower our profitability;



•

uncertain cost factors related to scarce technological skills and components;



•

the frequent need to bid on programs in advance of design completion, which may result in unforeseen technological difficulties and/or cost overruns; and



•

the substantial time and effort required for advanced product design and development design complexity, rapid obsolescence and the potential need for design improvement could negatively affect our profitability.

        The U.S. Government and their principal prime contractors periodically investigate the financial viability of their contractors and subcontractors as part of their risk assessment process associated with the award of new contracts. If the U.S. Government or one or more prime contractors were to determine that we were not financially viable, our ability to continue to act as a government contractor or subcontractor would be impaired. The U.S. Government also routinely audits our performance under various contracts and may, if appropriate, subsequently conduct an investigation into possible illegal or unethical activity in connection with these contracts. Investigations of this nature are common in the aerospace and defense industry and lawsuits may result. Possible consequences include civil and criminal fines and penalties, in some cases, double or treble damages, and suspension or debarment from future government contracting. An adverse result in any legal or administrative proceeding arising from one or more of these audits or investigations could have a material adverse effect on our business, financial condition and results of operations, hinder our ability to make payments on the notes and lead to a decline in the value of our common stock.

Our aerospace and defense segment could be adversely impacted by future reductions or changes in U.S. Government spending.

        Our primary aerospace and defense customers include the U.S. Department of Defense and its agencies, NASA and the government prime contractors that supply products to these customers. As a result, we rely on particular levels of U.S. Government spending on propulsion systems for space and defense applications and armament systems for precision tactical weapon systems and munitions applications. These spending levels are not generally correlated with any specific economic cycle, but rather, on the cycle of general political support for this type of spending. The overall U.S. defense budget declined in real terms from the mid-1980s through the early 1990s and has stabilized thereafter. Although the U.S. Department of Defense currently forecasts the defense budget to increase through its fiscal year 2005, we cannot assure you that future levels of defense spending will increase or that levels of defense spending will not decrease in the future. A decrease in U.S. military expenditures, or the elimination or curtailment of a material program in which we are involved, could have a material adverse effect on our business, financial condition or results of operations.

We may not be able to realize sales and profits from our significant backlog.

        Our significant backlog is derived from contracts with the U.S. Government and depends, in large part, on continued funding by the U.S. Government of the programs in which we are involved. These types of contracts typically permit the U.S. Government to unilaterally modify or terminate the contract or to discontinue funding for a particular program at any time. As a result, we cannot assure you that some part or even all of our current backlog will be realized as revenue. The cancellation of one or more significant contracts could have a material adverse effect on our ability to realize anticipated sales and profits in our aerospace and defense segment, and could therefore negatively impact our business, financial condition or results of operations.

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We face third-party performance and indemnification risks in connection with some of our U.S. Government contracts.

        In connection with the divestiture of certain of our operations, we have guaranteed performance of a number of U.S. Government contracts by the acquirer or acquirers of those operations and those acquirers have agreed to indemnify us for their non-performance. In the event the non-performance by the acquirers requires us to compensate the U.S. Government under our guarantee obligations, the refusal or inability of the acquirers to indemnify us in full for our losses on a timely basis could have a material adverse effect on our business, financial condition and results of operations, hinder our ability to make payments on the notes and lead to a decline in the value of our common stock.

The aerospace and defense industry is highly competitive.

        We encounter intense competition in bidding for contracts. Some of our competitors have financial, technical, production and other resources substantially greater than ours. In addition, although the downsizing of the defense industry in the early 1990s has resulted in a reduction in the number of competitors, the consolidation has also strengthened the capabilities of some of the remaining competitors resulting in an increasingly competitive environment. The U.S. Government also has its own manufacturing capabilities in some areas. We cannot assure you that we will be able to compete successfully with our competitors and our inability to do so could have a material adverse effect on our business, financial condition or results of operations. We cannot assure you that the U.S. Government will not open to competition programs on which we are currently the sole supplier, which could also adversely effect our profitability.

Aerojet has substantial real estate holdings, the value of which could be significantly affected by changes in the real estate market, government regulations and the possibility that a substantial portion of our property may not be released from existing Superfund site designation.

        Through Aerojet, we own sizable real estate holdings. A significant part of our strategy going forward will focus on unlocking the value we believe is inherent in these real estate assets. Our ability to realize this value will be affected by conditions from time to time in the real estate market in and surrounding Sacramento, California, where most of our real property is located, and in the other areas in which we own real estate, including general or local economic conditions, changes in neighborhood characteristics, real estate tax rates, the cost of operating our properties, governmental regulations and fiscal policies, acts of nature such as earthquakes and floods and other factors which are beyond our control. In addition, the development of our real estate holdings is subject to applicable zoning and other government regulations.

        In addition, our focus on our real estate holdings represents a new venture for us and we expect to need to hire additional qualified personnel to oversee implementation of this strategy. To that end, we have only recently hired a President to oversee our real estate business. As part of our strategy, we may sell or develop our land alone or in conjunction with third parties. If we decide to sell, we may not be able to do so at an attractive price. If we decide to develop the land, partners and/or funding may not be available. As a result, we may not be able to use or develop the land as we currently anticipate, if at all.

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Risks Related to Our GDX Automotive Segment

Results of Our GDX Automotive segment are dependent upon the commercial success of a limited number of vehicle platforms.

        In fiscal 2001, we derived a substantial portion of our GDX Automotive segment net sales from General Motors' full size pickup truck and sport utility vehicle and the Ford Explorer. Although the Draftex acquisition provided GDX with a significantly broader range of programs and customers, our GDX Automotive segment's future operating results will continue to depend significantly upon the continued market acceptance of vehicles for which we are a significant supplier. We cannot assure you that these types of vehicles, or other vehicles for which we are a supplier, will continue to enjoy the market acceptance they have in the past. A decline in the demand for these vehicles as a result of competition, technical change or other factors could have a material adverse effect on the business and financial results of our GDX Automotive segment and on our business, financial condition or results of operations as a whole.

The global automotive vehicle sealing business is highly competitive, and our failure to compete effectively or adverse market conditions could harm our business and profitability.

        The global automotive component supply industry in which our GDX Automotive segment competes is fragmented and highly competitive. Although we believe that we are the second largest automotive vehicle sealing manufacturer in the world, our ability to compete is dependent upon our ability to retain and grow our market share and to successfully adopt new strategies in response to changes in the marketplace.

        The automotive industry is characterized by a small number of original equipment manufacturers, or OEMs, that are able to exert considerable pressure on component suppliers to reduce costs, improve quality and provide innovative design and engineering. In the past, original equipment manufacturers have generally demanded and received price reductions and measurable increases in quality by implementing competitive selection processes, rating programs and other arrangements. Through increased partnering on platform work, the original equipment manufacturers have generally required component suppliers, including us, to provide more design engineering input at earlier stages of the development process, the cost of which, in some cases, is absorbed by the suppliers. Although we have generally been successful in offsetting losses caused by price reductions through cost reduction initiatives, we cannot assure you that future price reductions, increased quality standards or increased demand for technical innovation, such as better noise reduction, will not have a material adverse effect on our profitability.

        The loss of a production contract on an existing program or the failure to obtain new business to replace programs that are cancelled or terminated could have a material adverse effect on GDX's business and profitability.

Reductions in production volumes of one or more of our major OEM customers could materially adversely affect our business, financial condition and results of operations.

        GDX's business depends on the production volumes of its OEM customers which, in turn, depend on consumer confidence and general economic conditions. In the past several months, North American OEMS have taken actions to address economic uncertainties, such as laying-off employees, eliminating particular shifts at their manufacturing facilities and closing plants altogether. The events of September 11, 2001 and the resulting impact has also caused many of the OEMs to take further steps to counteract the economic impact on them of these events. For example, shortly after the terrorist attacks, Ford announced reductions in its North American production plants. Reductions in unit production volumes by Ford or other major OEM customers could have a material adverse effect on our business, financial condition or results of operations.

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Risks associated with foreign operations could adversely affect our results of operations.

        With the acquisition of Draftex, our GDX Automotive segment now operates in Canada, China, the Czech Republic, France, Germany and Spain. As part of our business strategy, we may expand our operations in these markets and move into other foreign markets. Foreign operations subject us to the risks of doing business abroad, including:

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currency exchange rate fluctuations;



•

difficulties in staffing and managing foreign operations;



•

political risks;



•

unexpected changes in regulatory requirements;



•

adverse tax consequences from operating in multiple jurisdictions; and



•

global and regional economic slowdowns.

Any of these factors, among others, could have a material adverse effect on our business, financial condition or results of operations.

An increase in the price or shortage of raw materials could have a material adverse affect on our business.

        The operations of our GDX Automotive segment are dependent on the availability of rubber and other raw materials. Because of this dependence, significant increases in the prices of these raw materials could have a material adverse effect on our results of operations and financial condition. Although we employ a diversified supplier base to mitigate the risk of supply interruption, we cannot assure you that there will not be a shortage of raw materials.

Risks Related to Our Fine Chemicals Segment

We have made significant capital investments in our fine chemicals segment, which we may never recoup.

        We have made significant capital investments in our fine chemicals segment. We are in the process of evaluating a number of strategic alternatives for our fine chemicals segment, one of which may include the sale of all or a portion of this business. If we decide to proceed with a sale of our fine chemicals segment, we may not be able to do so on favorable terms or at a price that is sufficient to recoup our investment.

The fine chemicals industry is highly competitive, and our failure to compete effectively could harm our business and profitability.

        The fine chemicals market is extremely fragmented, with the top one-third of the market in 2001 divided among approximately 13 competitors. Competition is based principally upon on-time delivery, manufacturing capability and expertise, reputation, service, price and reliability of supply. We cannot assure you that we will be successful in obtaining customer contracts on commercially favorable terms, if at all. Furthermore, our success depends to a significant extent on our ability to provide manufacturing service to potential customers at an early stage of product development and on continued technical innovation. We cannot assure you that we will be successful in such efforts.

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A decrease in demand for the fine chemical products we manufacture would have an adverse affect on our business, financial condition or results of operations.

        Our fine chemicals segment manufactures both registered intermediates and final active pharmaceutical ingredients used in finished products manufactured by our customers. Typically, there is a relatively lengthy lead-time between finalizing a production contract and the actual production of products under that contract. Accordingly, we rely upon the ability of our customers to anticipate changing customer needs, successfully market the products and obtain necessary regulatory approval. A decrease in demand for our customers' products would result in lower demand for our products. We cannot guarantee that our customers' product development efforts will be successful, required regulatory approvals can be obtained on a timely basis, if at all, products can be manufactured at acceptable cost and with appropriate quality or any products, if approved, can be successfully marketed. If customers are not successful in their efforts, they might reduce or cancel their orders and our results of operations likely would deteriorate.

Risks Relating to the Notes and the Common Stock Issuable Upon Conversion of the Notes

There is no established trading market for the notes.

        The notes are a new issue of securities for which there is no established trading market. Although the notes issued in the initial private placements are eligible for trading in the PORTAL system, the notes sold using this prospectus will no longer be eligible for trading in the PORTAL system. We do not intend to apply for listing of the notes on any other securities exchange or to arrange for quotation on any automated dealer quotation system. As a result, we cannot assure you that an final active trading market for the notes will develop, if it all. If a final active trading market does not develop or is not maintained, the market price and liquidity of the notes may be adversely affected.

        We cannot assure you that you will be able to sell your notes or the common stock issuable upon conversion of the notes at a particular time or that you will be able to sell your notes or the common stock at a favorable price. Future trading prices of the notes and the common stock will depend on many factors, including:

•

our operating performance and financial condition;



•

the interest of securities dealers in making a market; and



•

the market for similar securities.

        Historically, the markets for non-investment grade debt and equity securities have been subject to disruptions that have caused volatility in prices. It is possible that the markets for the notes and our common stock will be subject to disruptions, including disruptions arising out of terrorist activity such as the attacks that occurred in New York and Washington, D.C., on September 11, 2001. Any such disruptions may have a negative effect on you as a holder of the notes or the common stock issuable upon conversion of the notes, regardless of our prospects and financial performance.

The notes will be subordinate to our senior debt, which may impede our ability to repay you.

        The payment of principal, premium, if any, and interest on the notes by us is subordinate to all of our existing and future senior debt, except for any future debt that expressly provides that it ranks equal or junior, in right of payment, to the notes. The term "senior debt" is defined broadly in the indenture and includes all obligations under our senior credit facilities. As a result, in the event of our insolvency, liquidation or other reorganization, all senior debt must be paid in full before any amounts owed under the notes may be paid. In addition, our obligations under our senior credit facilities are secured by a first priority security interest in substantially all of our and our material domestic subsidiaries' tangible and intangible assets, as well as 100% of the stock of certain of our domestic

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subsidiaries and 65% of the stock of certain of our foreign subsidiaries. As of February 28, 2002, after giving pro forma effect to the sale of the notes and the application of the net proceeds, the notes would have been subordinated to approximately $91 million of senior debt. In addition, the notes will not be guaranteed by any of our subsidiaries. As a result, the notes are also effectively subordinated to all debt and other liabilities, including trade debt, of our subsidiaries. As of February 28, 2002, after giving pro forma effect to the sale of the notes and application of the net proceeds, our subsidiaries would have had approximately $716 million of outstanding debt and other liabilities, including trade debt but excluding pension liabilities, to which the notes would have been effectively subordinated. Because we may not have sufficient funds or assets to pay all of our creditors, holders of notes may receive less, ratably, than other creditors or they may receive no payment at all.

        The indenture does not limit the amount of debt, including senior debt, that we and our subsidiaries may incur in the future. In addition, the restrictions on the incurrence of additional debt contained in our senior credit facilities are subject to a number of important exceptions and limitations.

        Further, we may not pay any amount owed under the notes, or repurchase, redeem or otherwise retire the notes, if any payment default on our senior debt occurs unless, the default has been cured or waived, the senior debt is repaid in full or the holders of the senior debt consent to the payment. In addition, if any other default exists with respect to senior debt and specified other conditions are satisfied, at the option of the holders of that senior debt, we may be prohibited from making payments on the notes for a designated period of time. For additional information on the subordination terms applicable to the notes, see "Description of Notes — Subordination."

We may not be able to repurchase the notes upon a change of control.

        Upon a change of control, we will be required to make an offer to purchase all outstanding notes at 100% of their principal amount plus accrued and unpaid interest up to, but not including, the date of repurchase. The source of funds for any such purchase would be our available cash or third-party financing. However, we cannot assure you that we will have enough available funds at the time of any change of control to make required repurchases of tendered notes. Moreover, we are prohibited by our existing senior credit facilities from repurchasing any notes upon a change of control. Our existing senior credit facilities also provide that certain change of control events with respect to us constitute a default thereunder. Any future credit agreement or other agreements relating to indebtedness to which we become a party may contain similar restrictions or provisions. If we experience a change of control at a time when we are prohibited from repurchasing notes, we could seek the consent of our lenders to repurchase the notes or could attempt to refinance the indebtedness that contains the prohibition. In the event that we are unable to obtain consent and do not refinance the indebtedness, we would be prohibited from repurchasing the notes. Our failure to repurchase tendered notes at a time when the repurchase is required by the indenture would constitute a default under the indenture. This default would, in turn, constitute an event of default under our senior credit facilities and may constitute an event of default under future senior indebtedness. Under these circumstances, the subordination provisions in the indenture would restrict payments to holders of the notes before these other obligations are satisfied.

Volatility in the market price of our common stock could result in a lower trading price than your conversion or purchase price.

        The market price of our common stock has historically fluctuated over a wide range. In addition, the stock market in recent years has experienced significant price and volume fluctuations that have often been unrelated to the operating performance of companies. The market price of our common stock may continue to fluctuate in the future and may be adversely affected by factors such as actual or anticipated fluctuations in our operating results, acquisition activity, the impact of international

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markets, changes in financial estimates by securities analysts, general market conditions, rumors and other factors. Negative fluctuations in the market price of our common stock could adversely impact the trading price of the notes.

Future sales of our common stock in the public market could lower the market price for our common stock and adversely impact the trading price of the notes.

        We may, in the future, sell additional shares of our common stock to raise capital. We may also issue additional shares of our common stock to finance future acquisitions. Further, a substantial number of shares of our common stock are reserved for issuance pursuant to stock options and upon conversion of the notes. We cannot predict the size of future issuances or the effect, if any, that they may have on the market price for our common stock. The issuance of substantial amounts of common stock, or the perception that such sales may occur, could adversely affect the market price for our common stock and/or the trading price for the notes.

Various agreements and laws could delay or prevent a change of control that you may favor.

        The terms of some of the anti-takeover provisions of our articles of incorporation and Code of Regulations, our shareholder rights plan and provisions of Ohio law could delay or prevent a change of control that you may favor or may impede the ability of the holders of our common stock to change our management.

        In particular, the provision of our articles of incorporation and Code of Regulations, among other things:

•

require a majority vote of the holders of cumulative preference stock to approve certain transactions;



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divide our board of directors into three classes, with members of each class to be elected for staggered three-year terms;



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limit the right of shareholders to remove directors, fill vacancies and increase or reduce the number of directors;



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regulate how shareholders may present proposals or nominate directors for election at shareholders' meetings; and



•

authorize our board of directors to issue cumulative preference stock in one or more series, without shareholder approval.

        Our shareholder rights plan also makes an acquisition of a controlling interest in GenCorp in a transaction not approved by our board of directors more difficult.

        Additionally, Ohio law provides certain notice and informational filings and special shareholder meeting and voting procedures must be followed prior to consummation of a proposed "control share acquisition" as defined in the statute.

        Assuming compliance with the notice and information filings prescribed by statute, the proposed control share acquisition may be made only if, at a special meeting of shareholders, the acquisition is approved by both a majority of the voting power of the issuer represented at the meeting and a majority of the voting power remaining after excluding the combined voting power of the "interested shares," as defined in the statute. See "Description of Capital Stock — Ohio Control Share Statute."

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NOTE REGARDING FORWARD-LOOKING STATEMENTS

        This prospectus contains information that is forward-looking within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended, including material contingencies as described in the notes to our audited and unaudited consolidated financial statements incorporated by reference into the prospectus. The outcome of forward-looking statements and material contingencies could differ materially from those discussed due to inherent economic risks and changes in prevailing governmental policies and regulatory actions. You should not place undue reliance on these statements. Forward-looking statements include information concerning possible or assumed future results of operations, including descriptions of our business strategies. These statements often include words such as "anticipates," "expects," "plans," "intends" and similar expressions. We base these statements on particular assumptions that we have made in the light of our experience in our industries, as well as our perception of historical trends, current conditions, expected future developments and other factors we believe are appropriate in these circumstances. As you read and consider the information in this prospectus, you should understand that these statements are not guarantees of performance or results. They involve risks, uncertainties and assumptions. Although we believe that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect our actual financial results or results of operations and could cause actual results to differ materially from those expressed in the forward-looking statements.

        Some important factors that could cause our actual results or the outcome of these forward-looking statements to differ from those expressed in this prospectus include, but are not limited to, the following:

•

the reaction of our employees, shareholders, customers and lenders to the restatement of certain of our financial statements, including any litigation arising out of such restatement;



•

general economic trends affecting our markets and product offerings;



•

changes in the short-term and long-term plans of major customers and potential customers;



•

governmental and regulatory policies, including environmental regulations, and increases in the amount or timing of environmental remediation and compliance costs;



•

an unexpected adverse result in the toxic tort or other litigation, proceeding or investigation pending against us;



•

our acquisition and disposition of businesses and joint venture activities;



•

vehicle sales and production rates of major automotive programs in the United States and abroad, particularly vehicles for which we supply components;



•

the level of funding secured by the U.S. Department of Defense and the National Aeronautics and Space Administration, or NASA, for aerospace and defense programs for which we are a supplier;



•

future funding for commercial launch vehicles and propulsion systems;



•

our ability to achieve the anticipated savings from the restructuring and other financial management programs that we have implemented;



•

our ability to successfully complete the entitlement process and related pre-development activities for our real estate;



•

the market for our real estate in California;



•

fluctuations in currency exchange rates and other risks associated with foreign operations;

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•

our ability to satisfy contract performance criteria;



•

our ability to maintain a high level of product performance, particularly related to the continued success of our launch vehicle propulsion platforms;



•

an adverse decision in any patent infringement suit, or settlement of a patent infringement suit impacting our right to utilize technology, particularly in our fine chemicals segment;



•

intense competition from competitors in each of our businesses;



•

pricing pressures from our major customers, particularly in our GDX Automotive segment;



•

potential liabilities which could arise from any release or explosion of dangerous materials;



•

work stoppages at one or more of our facilities or at a facility of one of our significant customers; and



•

cost escalation and availability of suitable energy sources in the locations where we operate, particularly in Northern California, which has experienced power shortages in the recent past.

        These and other risks are described above in more detail under "Risk Factors." Additional risks may be described from time to time in our filings with the Securities and Exchange Commission. All of these risk factors are difficult to predict, contain material uncertainties that may affect actual results and may be beyond our control.

RATIO OF EARNINGS TO FIXED CHARGES

        The following table shows the earnings to fixed charges of GenCorp for the three months ended February 28, 2002 and for each of the five most recent fiscal years.

		Year ended November 30,
	Three Months ended February 28, 2002
		2001	2000	1999	1998	1997
Ratio of earnings to fixed charges	3.0	4.4	5.2	10.1	8.5	4.9

        For purposes of calculating the ratio of earnings to fixed charges, "earnings" represents income from continuing operations before income taxes, plus fixed charges. "Fixed charges" consist of interest expense, amortization of debt issuance costs and that portion of rental expense considered to be a reasonable approximation of interest expense.

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USE OF PROCEEDS

        All sales of the notes or common stock issuable upon conversion of the notes will be by or for the account of the selling security holders listed in this prospectus or any prospectus supplement. We will not receive any proceeds from the sale by any selling securityholder of the notes or the common stock issuable upon conversion of the notes.

        The aggregate net proceeds from the initial private placements of the notes, after deduction of underwriting discounts and expenses, were approximately $144 million. We used those net proceeds as follows:

•

$25 million to repay in full outstanding loans under our Tranche C term loan facility; and



•

$119 million to repay outstanding borrowings under our revolving credit facility.

        The Tranche C term loans accrued interest at a rate of 8.25% per annum as of February 28, 2002 and were scheduled to mature on December 28, 2004.

        The borrowings repaid under our revolving credit facility accrued interest at an average rate of 5.40% per annum as of February 28, 2002 and would have matured on December 28, 2005. Amounts repaid under the revolving credit facility may be reborrowed at any time or from time to time and borrowings may be used for any purpose, subject only to the limitations contained in that facility.

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PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY

        Our common stock is listed on the New York Stock Exchange and the Chicago Stock Exchange under the trading symbol "GY." The following table lists, on a per share basis for the periods indicated, the high and low closing sale prices for the common stock as reported by the New York Stock Exchange:

		Common Stock Price
Fiscal Year Ended November 30,
		High		Low
2000
	First Quarter	$	11.00	$	6.75
	Second Quarter	$	10.56	$	6.94
	Third Quarter	$	9.94	$	6.88
	Fourth Quarter	$	9.56	$	7.31
2001
	First Quarter	$	12.50	$	7.81
	Second Quarter	$	12.45	$	10.06
	Third Quarter	$	14.20	$	11.65
	Fourth Quarter	$	13.10	$	10.95
2002
	First Quarter	$	14.78	$	10.64
	Second Quarter (through May 31, 2002)	$	15.95	$	10.95

        As of May 30, 2002, there were 14,188 holders of record of the common stock. On May 31, 2002, the last reported sale price of the common stock as quoted on the New York Stock Exchange was $14.60 per share.

        During each quarter in 2000 and 2001 and for the first and second quarters of 2002, we paid a quarterly cash dividend on our common stock of $0.03 per share.

        We have paid cash dividends every quarter since 1937. Our Board of Directors considers the payment of dividends based upon the earnings and financial condition of the company, as well as other relevant considerations. Our senior credit facilities impose limitations on the payment of dividends.

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CAPITALIZATION

        The following table sets forth, as of February 28, 2002, our actual historical capitalization and our as adjusted capitalization giving effect to the initial sale of the notes in April 2002 and the application of the net proceeds from that sale:

					February 28, 2002
					Actual			As Adjusted
					(unaudited) (in millions)
Cash and cash equivalents					$	54		$	54
Long-term debt, including current maturities:
	Senior credit facilities:
		Revolving loan facility(1)			$	125		$	6
		Tranche A term loans				85			85
		Tranche C term loans				25			—
			Total senior credit facilities			235			91
	Other					11			11
	Notes offered hereby					—			150
				Total long-term debt, including current maturities		246			252
Shareholders' equity:
	Preference stock, par value of $1.00; 15.0 million shares authorized, none issued or outstanding					—			—
	Common stock, par value of $0.10; 150.0 million shares authorized; 43.0 million shares issued, 42.7 million shares outstanding					4			4
	Other capital					10			10
	Retained earnings					333			333
	Accumulated other comprehensive loss, net of income taxes					(39	)		(39	)
				Total shareholders' equity		308			308
				Total capitalization	$	554		$	560

(1)

At February 28, 2002, we had approximately $17 million of borrowing availability under our revolving credit facility. After giving effect to the sale of the notes and the application of the net proceeds from that sale, we would have had approximately $136 million of borrowing availability under our revolving credit facility at that date. On April 19, 2002, the commitments available to us under our revolving credit facility were reduced by $13 million to $137 million.

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DESCRIPTION OF NOTES

        The notes were issued under an indenture between GenCorp Inc. and The Bank of New York, as trustee. The following description is only a summary of the material provisions of the indenture, the notes and the registration rights agreement. We urge you to read the indenture, the notes and the registration rights agreement in their entirety because they, and not this description, define your rights as holders of the notes. You may request copies of these documents by writing to us at the address shown under the caption "Where You Can Find More Information And Incorporation by Reference." The terms of the notes include those stated in the indenture and those made part of the indenture by reference to the Trust Indenture Act of 1939, as amended. For purposes of this section, references to "we," "us," "ours" and "GenCorp" include only GenCorp Inc. and not its subsidiaries.

General

        We issued notes having a principal amount of $150,000,000 in private transactions on April 5, 2002 and April 17, 2002. The notes are unsecured, subordinated obligations of GenCorp and will mature on April 15, 2007, unless earlier redeemed at our option as described under "—Optional Redemption of the Notes" or repurchased by us at a holder's option upon a change of control of GenCorp as described under "—Right to Require Purchase of Notes upon a Change of Control." Interest on the notes will accrue at the rate of 5.75% per annum and will be payable semiannually in arrears on April 15 and October 15 of each year, commencing on October 15, 2002. Interest on the notes will accrue from the date of original issuance or, if interest has already been paid, from the date it was most recently paid. We will make each interest payment to the holders of record of the notes on the immediately preceding March 31 and September 30, or if such day is not a business day, on the next succeeding business day. Interest on the notes will be computed on the basis of a 360-day year comprised of twelve 30-day months. The indenture does not contain any restriction on:

•

the payment of dividends;

•

the issuance of Senior Indebtedness, as defined below, or other indebtedness; or

•

the repurchase of securities of GenCorp;

and does not contain any financial covenants. Other than as described under "—Right to Require Purchase of Notes upon a Change of Control," the indenture contains no covenants or other provisions to afford protection to holders of notes in the event of a highly leveraged transaction or a change of control of GenCorp.

        We will pay the principal of, premium, if any, and interest on the notes at the office or agency maintained by us in the Borough of Manhattan in New York City. Holders may register the transfer of their notes at the same location. Except under the limited circumstances described below, the notes will be issued only in fully-registered book-entry form, without coupons, and will be represented by one or more global notes. There will be no service charge for any registration of transfer or exchange of notes. We may, however, require holders to pay a sum sufficient to cover any tax or other governmental charge payable in connection with any transfer or exchange.

Conversion Rights

        A holder may, at any time after July 5, 2002 and before the close of business on the business day immediately preceding the maturity date, convert a note or any portion of a note, if the portions are $1,000 or whole multiples of $1,000, into shares of our common stock initially at the conversion price stated on the cover page of this prospectus. This conversion price is equivalent to an initial conversion rate of approximately 54.2888 shares per $1,000 principal amount of notes. The right to convert a note called for redemption will terminate at the close of business on the business day immediately preceding the date fixed for redemption, unless we default in making the payment due on the redemption date. For information as to notices of redemption, see "—Optional Redemption of

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the Notes." If a holder of a note has delivered notice of its election to have the note repurchased as a result of a Change of Control, the note may be converted only if the notice of election is withdrawn as described under "—Right to Require Purchase of Notes upon a Change of Control."

        We will adjust the conversion price if, without duplication:

        (1)  we issue common stock as a dividend or distribution on our common stock;

        (2)  we subdivide, combine or reclassify our common stock;

        (3)  we issue to substantially all holders of our common stock rights, warrants or options entitling them to subscribe for or purchase common stock at less than the then current market price;

        (4)  we distribute to substantially all holders of common stock evidences of our indebtedness, shares of capital stock, other than common stock, securities, cash, property, rights, warrants or options, excluding:

•

those rights or options referred to in clause (3) above;

•

any dividend or distribution paid exclusively in cash not referred to in clause (5) below; and

•

any dividend or distribution referred to in clause (1) above;

        (5)  we make a cash distribution to substantially all holders of our common stock, that together with all other all-cash distributions and consideration payable in respect of any repurchase, including by way of tender or exchange offer, by us or one of our subsidiaries for our common stock made within the preceding twelve months, exceeds 10% of our aggregate market capitalization; or

        (6)  we complete a repurchase, including by way of a tender or exchange offer, of our common stock which involves an aggregate consideration that, together with:

•

any cash and other consideration payable in respect of any repurchase, including by way of a tender or exchange offer, by us or one of our subsidiaries for our common stock concluded within the preceding twelve months; and

•

the amount of any and all cash distributions to all holders of our common stock made within the preceding twelve months;

exceeds 10% of our aggregate market capitalization on the date of any such repurchase or the expiration of any such tender or exchange offer.

        In the event that we pay a dividend or make a distribution on shares of our common stock consisting of capital stock of, or similar equity interests in, a subsidiary or other business unit of ours, the conversion price will be adjusted based on the market value of the securities so distributed relative to the market value of our common stock, in each case based on the average closing prices of those securities for the 10 trading days commencing on and including the fifth trading day after the date on which "ex-dividend trading" commences for such dividend or distribution on the principal United States securities exchange or market on which the securities are then listed or quoted.

        We will not be required to make an adjustment in the conversion price unless the adjustment would require a change of at least 1% in the conversion price. However, any adjustments that are less than 1% of the conversion price will be taken into account in any subsequent adjustment.

        If our common stock is converted into the right to receive other securities, cash or other property as a result of reclassifications, consolidations, mergers, sales or transfers of assets or other transactions, each note then outstanding will, without the consent of any holders of notes, become convertible only into the kind and amount of securities, cash and other property receivable upon the

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transaction by a holder of the number of shares of common stock which would have been received by a holder immediately prior to the transaction if the holder had converted the note.

        We will not issue fractional shares of common stock to a holder who converts a note. In lieu of issuing fractional shares, we will pay cash based upon the market price of our common stock at the time of conversion.

        Except as described in this paragraph, no holder of notes will be entitled, upon conversion of the notes, to any actual payment or adjustment on account of accrued and unpaid interest or on account of dividends on shares of common stock issued in connection with the conversion. If any holder surrenders a note for conversion between the close of business on any record date for the payment of an installment of interest and the opening of business on the related interest payment date, the holder must deliver payment to us of an amount equal to the interest payable on the interest payment date on the principal amount converted together with the note being surrendered. The foregoing sentence shall not apply to notes called for redemption on a redemption date within the period between and including the record date and interest payment date.

        If we make a distribution to our shareholders which would be taxable to them as a dividend for federal income tax purposes and the conversion price of the notes is reduced, this reduction may be deemed to be the receipt of taxable income to holders of the notes.

        In addition, we may make any reductions in the conversion price that our board of directors deems advisable to avoid or diminish any income tax to holders of our common stock resulting from any dividend or distribution of stock, or rights to acquire stock, or from any event treated as such for income tax purposes or for any other reasons.

Subordination

        The payment of the principal of, premium, if any, and interest on the notes is, to the extent described in the indenture, subordinated in right of payment to the prior payment in full of all our Senior Indebtedness. The holders of all Senior Indebtedness will first be entitled to receive payment in full in cash of all amounts due or to become due on the Senior Indebtedness, or provision for payment in cash or cash equivalents, before the holders of the notes will be entitled to receive any payment in respect of the notes, when there is a payment or distribution of assets to creditors upon our:

•

liquidation;

•

dissolution;

•

winding up;

•

reorganization;

•

assignment for the benefit of creditors;

•

marshaling of assets;

•

bankruptcy;

•

insolvency; or

•

similar proceedings.

        In addition, our subsidiaries are separate and distinct legal entities and have no obligation to pay any amounts due on the notes or to provide us with the funds to satisfy our payment obligations. As a result, the notes are effectively subordinated to all existing and future indebtedness and other liabilities of our subsidiaries. As of February 28, 2002, after giving pro forma effect to the sale of the notes and the application of the net proceeds, our subsidiaries would have had approximately

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$716 million of indebtedness and other liabilities outstanding, including trade debt but excluding pension liabilities, to which the notes would have been effectively subordinated.

        No payment on account of the notes or on account of the purchase or acquisition of notes may be made if a default in any payment with respect to Senior Indebtedness has occurred and is continuing. If (1) there is a default on any Designated Senior Indebtedness other than a payment default that occurs that permits the holders of that Designated Senior Indebtedness to accelerate its maturity and (2) the trustee and GenCorp receive the notice required by the indenture, no payments may be made on the notes for up to 179 days in any 365-day period unless the default is cured or waived. By reason of this subordination, in the event of our insolvency, holders of the notes may recover less ratably than holders of our Senior Indebtedness. We may be required to obtain the consent of holders of Senior Indebtedness prior to redeeming the notes or satisfying or discharging our obligations under the indenture prior to the maturity of the notes.

        "Senior Indebtedness" means the principal of, premium, if any, and interest on, and fees, costs, enforcement expenses, collateral protection expenses and other reimbursement or indemnity obligations in respect of, and any other payments due pursuant to, any of the following, whether outstanding as of the date of the indenture or incurred or created thereafter, unless, in the case of any particular indebtedness, the instrument creating or evidencing the same or pursuant to which the same is outstanding expressly provides that such indebtedness shall not be senior in right of payment to the notes:

•

all of our indebtedness, obligations and other liabilities, contingent or otherwise, for money borrowed that is evidenced by a note, bond, debenture, loan agreement, or similar instrument or agreement, including, without limitation, all amounts outstanding from time to time under the Credit Agreement;

•

all of our noncontingent obligations (1) for the reimbursement of any obligor on any letter of credit, banker's acceptance or similar credit transaction, (2) under interest rate swaps, caps, collars, options, and similar arrangements, and (3) under any foreign exchange contract, currency swap agreement, futures contract, currency option contract or other foreign currency hedge;

•

all of our obligations for the payment of money relating to capital lease obligations; and

•

any liabilities of our subsidiaries described in the preceding clauses that we have guaranteed or which are otherwise our legal liability; and

•

renewals, extensions, refundings, refinancings, restructurings, amendments and modifications of any such obligations.

provided, however, that in no event shall Senior Indebtedness include (a) indebtedness or other obligations owed to any of our subsidiaries or affiliates, (b) trade account payables incurred in the ordinary course of business, (c) any liabilities for taxes owed or owing by us or any of our subsidiaries or (d) our obligations under the notes.

        "Credit Agreement" means the Credit Agreement, dated as of December 28, 2000, among us and Deutsche Bank Trust Company Americas (formerly Bankers Trust Company) for itself and as administrative agent for the other lenders party thereto from time to time, as that agreement may be amended (including any amendment and restatement thereof), supplemented or otherwise, modified from time to time, including any agreement extending the maturity of, refinancing, replacing or otherwise restructuring, including increasing the amount of available borrowings thereunder, all or any portion of the indebtedness under that agreement or any successor or replacement agreement and whether by the same or any other agent, lender or group of lenders.

        "Designated Senior Indebtedness" means (i) indebtedness under or in respect of the Credit Agreement, and (ii) any other indebtedness constituting Senior Indebtedness which, at the time of

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determination, has an aggregate principal amount of at least $25 million and is specifically designated in the instrument evidencing such Senior Indebtedness as "Designated Senior Indebtedness" by GenCorp. The instrument, agreement or other document evidencing any Designated Senior Indebtedness may place limitations and conditions of the right of such Senior Indebtedness to exercise the rights of Designated Senior Indebtedness.

        As of February 28, 2002, after giving pro forma effect to the sale of the notes and the application of the net proceeds, we would have had $91 million of indebtedness and other obligations that would have constituted Senior Indebtedness. We expect from time to time to incur additional indebtedness and obligations that will constitute Senior Indebtedness. The indenture does not limit or prohibit us from incurring additional Senior Indebtedness or other indebtedness.

Optional Redemption of the Notes

        At any time on or after April 22, 2005, we may redeem the notes in whole, or from time to time, in part, at our option upon not less than 30 days nor more than 60 days' notice if the trading price of our common stock for 20 trading days in a period of 30 consecutive trading days ending on the day prior to the mailing of notice of redemption exceeds 125% of the conversion price of the notes. The redemption price, expressed as a percentage of the principal amount, will be as follows:

Redemption Period	Redemption Price
April 22, 2005 through April 14, 2006	101.0	%
April 15, 2006 through April 14, 2007	100.5	%

        If we opt to redeem less than all of the notes at any time, the trustee will select or cause to be selected the notes to be redeemed on a pro rata basis, by lot or by any method that it deems fair and appropriate. In the event of a partial redemption, the trustee may provide for selection for redemption of portions of the principal amount of any note of a denomination larger than $1,000. If a portion of a holder's notes is selected for partial redemption and that holder converts a portion of its notes, the converted portion will be deemed to first be the portion selected for redemption.

Mandatory Redemption

        Except as set forth below under "—Right to Require Purchase of Notes upon a Change of Control," we are not required to make mandatory redemption of, or sinking fund payments with respect to, the notes.

Right to Require Purchase of Notes upon a Change of Control

        If a Change of Control, as defined below, occurs, each holder of notes may require that we repurchase the holder's notes on the date fixed by us that is not less than 45 nor more than 60 days after we give notice of the Change of Control. We will repurchase the notes for an amount of cash equal to 100% of the principal amount of the notes on the date of purchase, plus accrued and unpaid interest, if any, to the date of repurchase.

        "Change of Control" means the occurrence of one or more of the following events: (i) any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all or substantially all of the assets of GenCorp and its subsidiaries, taken as a whole, to any person or group of related persons, as defined in Section 13(d) of the Exchange Act, which for purposes of this definition will constitute a "group"; (ii) the approval by the holders of capital stock of GenCorp of any plan or proposal for the liquidation or dissolution of GenCorp, whether or not otherwise in compliance with the provisions of the applicable indenture; (iii) any person or Group shall become the owner, directly or indirectly, beneficially or of record, of shares representing more than 45% of the aggregate ordinary voting power represented by GenCorp's issued and outstanding Voting Stock of,

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or any successor to, all or substantially all of GenCorp's assets; or (iv) the first day on which a majority of the members of GenCorp's board of directors are not Continuing Directors.

        The definition of Change of Control includes a phrase relating to the sale, lease, transfer, conveyance or other disposition of "all or substantially all" of the assets of GenCorp and its subsidiaries taken as a whole. Although there is a developing body of case law interpreting the phrase "substantially all", there is no precise established definition of the phrase under applicable law. Accordingly, the ability of a holder of notes to require GenCorp to repurchase such notes as a result of a sale, lease, transfer, conveyance or other disposition of less than all of the assets of GenCorp and its subsidiaries taken as a whole to another person or group may be uncertain.

        "Continuing Directors" means, as of any date of determination, any member of the board of directors of GenCorp who (i) was a member of such board of directors on the date of the original issuance of the notes or (ii) was nominated for election or elected to such board of directors with the approval of a majority of the Continuing Directors who were members of such board at the time of such nomination or election.

        "Voting Stock" means stock or securities of the class or classes pursuant to which the holders thereof have the general voting power under ordinary circumstances to elect at least a majority of the board of directors, managers or trustees of a person (irrespective of whether or not at the time stock of any other class or classes shall have or might have voting power by reason of the happening of any contingency).

        On or prior to the date of repurchase, we will deposit with a paying agent an amount of money sufficient to pay the aggregate repurchase price of the notes which is to be paid on the date of repurchase.

        We may not repurchase any note at any time when the subordination provisions of the indenture otherwise would prohibit us from making payments of principal in respect of the notes. If we fail to repurchase the notes when required under the preceding paragraph, this failure will constitute an event of default under the indenture whether or not repurchase is permitted by the subordination provisions of the indenture.

        On or before the 30th day after the Change of Control, we must mail to the trustee and all holders of the notes a notice of the occurrence of the Change of Control, stating:

•

the repurchase date;

•

the date by which the repurchase right must be exercised;

•

the repurchase price for the notes; and

•

the procedures which a holder of notes must follow to exercise the repurchase right.

        To exercise the repurchase right, the holder of a note must deliver, on or before the third business day before the repurchase date, a written notice to us and the trustee of the holder's exercise of the repurchase right. This notice must be accompanied by certificates evidencing the note or notes with respect to which the right is being exercised, duly endorsed for transfer. This notice of exercise may be withdrawn by the holder at any time on or before the close of business on the business day preceding the repurchase date.

        The effect of these provisions granting the holders the right to require us to repurchase the notes upon the occurrence of a Change of Control may make it more difficult for any person or group to acquire control of us or to effect a business combination with us. The repurchase right resulted from negotiations between GenCorp and the initial purchasers. It is not part of any plan by management to adopt a series of anti-takeover provisions and GenCorp has no present intention to engage in a transaction that would result in a Change of Control, although it is possible that GenCorp may decide to do so in the future. In addition, the repurchase feature may not necessarily afford you protection in

31

the event of a highly leveraged transaction, including acquisitions, mergers, refinancings, restructurings, recapitalizations and other similar transactions, involving GenCorp. We could in the future enter into these types of transactions that would not necessarily constitute a Change of Control but would increase the amount of our Senior Indebtedness or other indebtedness. Moreover, we cannot assure you that sufficient funds will be available when necessary to make any required repurchases.

        The Credit Agreement prohibits, and other future agreements relating to Senior Indebtedness to which GenCorp becomes a party may prohibit, GenCorp from purchasing any notes following a Change of Control. In addition, the Credit Agreement provides, and other future agreements relating to Senior Indebtedness to which GenCorp becomes a party may provide, that certain change of control events with respect to GenCorp would constitute a default thereunder. In the event a Change of Control occurs at a time when GenCorp is prohibited from purchasing notes, GenCorp could seek the consent of its lenders to the purchase of notes or could attempt to refinance the borrowings that contain such prohibition. If GenCorp does not obtain such a consent or repay such borrowings, GenCorp will remain prohibited from purchasing notes. GenCorp's failure to purchase tendered notes following a Change of Control would constitute an Event of Default under the indenture which, in turn, will constitute a default under the Credit Agreement. In such circumstances, the subordination provisions in the indenture would likely restrict payments to the holders of notes.

        If a Change of Control occurs and the holders exercise their rights to require us to repurchase notes, we will comply with the tender offer rules under the Exchange Act with respect to any repurchase to the extent applicable.

        The term "beneficial owner" will be determined in accordance with Rules 13d-3 and 13d-5 promulgated by the Securities and Exchange Commission under the Exchange Act or any successor provision, except that a person shall be deemed to have "beneficial ownership" of all shares that the person has the right to acquire, whether exercisable immediately or only after the passage of time.

Consolidation, Merger and Sale of Assets

        We may not consolidate with or merge into any other person or convey, transfer or lease our properties and assets substantially as an entirety to, any other person in a single transaction or a series of transactions, unless:

•

we are the resulting or surviving corporation or the successor, transferee or lessee, if other than us, is a corporation organized under the laws of any U.S. jurisdiction and expressly assumes our obligations under the indenture and the notes by means of a supplemental indenture entered into with the trustee;

•

after giving effect to the transaction, no event of default and no event which, with notice or lapse of time, or both, would constitute an event of default, shall have occurred and be continuing; and

•

we or the surviving entity will have delivered to the trustee an opinion of counsel stating that the transaction or series of transactions and the supplemental indenture, if any, complies with the applicable provisions of the indenture.

        Under any consolidation, merger or any conveyance, transfer or lease of our properties and assets as described in the preceding paragraph, the successor company will be our successor and will succeed to, and be substituted for, and may exercise every right and power of, GenCorp under the indenture. Except in the case of a lease, if the predecessor is still in existence after the transaction, it will be released from its obligations and covenants under the indenture and the notes.

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Modification and Waiver

        We and the trustee may enter into one or more supplemental indentures that add, change or eliminate provisions of the indenture or modify the rights of the holders of the notes with the consent of the holders of at least a majority in principal amount of the notes then outstanding. However, without the consent of each holder of an outstanding note, no supplemental indenture may:

•

change the stated maturity of the principal of, or any installment of interest on, any note;

•

reduce the principal amount of, or the premium or rate of interest on, any note;

•

change the currency in which the principal of or any premium or interest on any note is payable;

•

impair the right to institute suit for the enforcement of any payment on or with respect to any note when due;

•

adversely affect the right provided in the indenture to convert any note;

•

change the number of shares of common stock issuable upon the conversion of a note in a manner adverse to the holders of the notes other than in accordance with the terms of the indenture;

•

change the redemption provisions of the indenture in a manner adverse to the holders of the notes;

•

modify the subordination provisions of the indenture in a manner adverse to the holders of the notes;

•

modify the provisions of the indenture relating to our requirement to offer to repurchase notes upon a Change of Control in a manner adverse to the holders of the notes;

•

reduce the percentage in principal amount of the outstanding notes necessary to modify or amend the indenture or to consent to any waiver provided for in the indenture; or

•

waive a default in the payment of principal of, or any premium or interest on, any note.

        The holders of a majority in principal amount of the outstanding notes may, on behalf of the holders of all notes:

•

waive compliance by us with restrictive provisions of the indenture other than as provided in the preceding paragraph; and

•

waive any past default under the indenture and its consequences, except a default in the payment of the principal of or any premium or interest on any note or in respect of a provision which under the indenture cannot be modified or amended without the consent of the holder of each outstanding note affected.

        Without the consent of any holders of notes, we and the trustee may enter into one or more supplemental indentures for any of the following purposes:

•

to cure any ambiguity, omission, defect or inconsistency in the indenture;

•

to evidence a successor to us and the assumption by the successor of our obligations under the indenture and the notes;

•

to make any change that does not adversely affect the rights of any holder of the notes;

•

to comply with any requirement in connection with the qualification of the indenture under the Trust Indenture Act; or

•

to complete or make provision for certain other matters contemplated by the indenture.

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Events of Default

        Each of the following is an "event of default":

        (1)  failure to pay any interest upon any of the notes when due and payable, if the failure continues for 30 days;

        (2)  a default in the payment of the principal of and premium, if any, on any of the notes when due, including on a redemption date;

        (3)  failure to pay when due the principal of or interest on indebtedness for money borrowed by us or our subsidiaries in excess of $10 million, or the acceleration of that indebtedness that is not withdrawn within 30 days after the date of written notice to us by the trustee or to us and the trustee by the holders of at least 25% in principal amount of the outstanding notes;

        (4)  our failure to deliver shares of common stock within 15 days after such common stock is required to be delivered upon conversion of a note as provided in the indenture;

        (5)  a default by us in the performance, or breach, of any of our other covenants in the indenture which are not remedied by the end of a period of 60 days after written notice to us by the trustee or to us and the trustee by the holders of at least 25% in principal amount of the outstanding notes; or

        (6)  events of bankruptcy, insolvency or reorganization of GenCorp or any Significant Subsidiary of GenCorp.

        If an event of default described in clauses (1), (2), (3), (4) or (5) occurs and is continuing, either the trustee or the holders of at least 25% in principal amount of the outstanding notes may declare the principal amount of and accrued interest on all notes to be immediately due and payable. This declaration may be rescinded if the conditions described in the indenture are satisfied. If an event of default of the type referred to in clause (6) occurs, the principal amount of and accrued interest on the outstanding notes will automatically become immediately due and payable.

        "Significant Subsidiary" means any subsidiary or group of subsidiaries which has (i) consolidated assets or in which GenCorp and its other subsidiaries have investments, equal to or greater than 10% of the total consolidated assets of GenCorp at the end of its most recently completed fiscal year; or (ii) consolidated gross revenue equal to or greater than 10% of the consolidated gross revenue of GenCorp for its most recently completed fiscal year.

        Within 30 days after a default, the trustee must give to the registered holders of notes notice of all uncured defaults known to it. The trustee will be protected in withholding the notice if it in good faith determines that the withholding of the notice is in the best interests of the registered holders, except in the case of a default in the payment of the principal of, or premium, if any, or interest on, any of the notes when due or in the payment of any redemption obligation.

        The holders of not less than a majority in principal amount of the outstanding notes may direct the time, method and place of conducting any proceedings for any remedy available to the trustee, or exercising any trust or power conferred on the trustee. Subject to the provisions of the indenture relating to the duties of the trustee, if an event of default occurs and is continuing, the trustee will be under no obligation to exercise any of the rights or powers under the indenture at the request or direction of any of the holders of the notes unless the holders have offered to the trustee reasonable indemnity or security against any loss, liability or expense. Except to enforce the right to receive payment of principal, premium, if any, or interest when due or the right to convert a note in accordance with the indenture, no holder may institute a proceeding or pursue any remedy with

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respect to the indenture or the notes unless it complies with the conditions provided in the indenture, including:

•

holders of at least 25% in principal amount of the outstanding notes have requested the trustee to pursue the remedy; and

•

holders have offered the trustee security or indemnity satisfactory to the trustee against any loss, liability or expense.

        We are required to deliver to the trustee annually a certificate indicating whether the officers signing the certificate know of any default by us in the performance or observance of any of the terms of the indenture. If the officers know of a default, the certificate must specify the status and nature of all defaults.

Book-Entry, Delivery and Form

        The notes were sold to the initial purchasers in a transactions exempt from the registration requirements of the Securities Act and were issued in the form of one or more global notes. The notes were resold to "qualified institutional buyers," as defined in Rule 144A under the Securities Act, in reliance on Rule 144A. The global notes were deposited with, or on behalf of, the clearing agency registered under the Exchange Act that is designated to act as depositary for the notes and registered in the name of the depositary or its nominee. DTC is the initial depositary. Investors may hold their interests in a global note directly through DTC if they are DTC participants, or indirectly through organizations that are DTC participants. Notes in definitive certificated form will be issued only in limited circumstances described below.

        Except as set forth below, a global note may be transferred, in whole or in part, only to another nominee of DTC or to a successor of DTC or its nominee.

        DTC has advised us that DTC is:

•

a limited-purpose trust company organized under the New York Banking Law;

•

a "banking organization" within the meaning of the New York Banking Law;

•

a member of the Federal Reserve System;

•

a "clearing corporation" within the meaning of the New York Uniform Commercial Code; and

•

a "clearing agency" registered pursuant to the provisions of Section 17A of the Exchange Act.

        DTC was created to hold securities of institutions that have accounts with DTC and to facilitate the clearance and settlement of securities transactions among its participants in securities through electronic book-entry changes in accounts of the participants, thereby eliminating the need for physical movement of securities certificates. DTC's participants include securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations.

        Access to DTC's book-entry system is also available to others such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a participant, whether directly or indirectly. The rules applicable to DTC and its participants are on file with the SEC.

        We have provided the following description of the operations and procedures of DTC, solely as a matter of convenience. These operations and procedures are solely within the control of DTC and are subject to change by it from time to time. Neither GenCorp, the initial purchasers nor the trustee takes any responsibility for those operations or procedures, and you are urged to contact DTC or its participants directly to discuss these matters.

        Pursuant to the procedures established by DTC (1) upon the issuance of the global notes, DTC credited, on its book-entry registration and transfer system, the respective principal amount of the individual beneficial interests represented by the global notes to the accounts of participants and

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(2) ownership of beneficial interests in the global notes is shown on, and the transfer of those ownership interests will be effected only through, records maintained by DTC, with respect to participants' interests, and the participants, with respect to the owners of beneficial interests in the global notes other than participants. The accounts to be credited will be designated by the initial purchasers of the beneficial interests. Ownership of beneficial interests in the global notes will be limited to participants or persons that may hold interests through participants.

        The laws of some jurisdictions may require that purchasers of securities take physical delivery of those securities in definitive form. Accordingly, the ability to transfer interests in the notes represented by a global note to those persons may be limited. In addition, because DTC can act only on behalf of its participants, who in turn act on behalf of persons who hold interests through participants, the ability of a person having an interest in notes represented by a global note to pledge or transfer those interests to persons or entities that do not participate in DTC's system, or otherwise to take actions in respect of such interest, may be affected by the lack of a physical definitive security in respect of such interest.

        So long as DTC or its nominee is the registered holder and owner of a global note, DTC or its nominee, as the case may be, will be considered the sole legal owner of the notes represented by the global note for all purposes under the Indenture and the notes. Except as set forth below, owners of beneficial interests in a global note will not be entitled to receive definitive notes and will not be considered to be the owners or holders of any notes under the global note. We understand that under existing industry practice, in the event an owner of a beneficial interest in a global note desires to take any action that DTC, as the holder of the global note, is entitled to take, DTC would authorize the participants to take the action, and that participants would authorize beneficial owners owning through the participants to take the action or would otherwise act upon the instructions of beneficial owners owning through them. No beneficial owner of an interest in a global note will be able to transfer the interest except in accordance with DTC's applicable procedures, in addition to those provided for under the Indenture.

        Neither GenCorp nor the trustee has any responsibility or liability for any aspect of the records relating to or payments made on account of notes by DTC, or for maintaining, supervising or reviewing any records of DTC relating to the notes.

        We will make payments of the principal of, and interest on, the notes represented by a global note registered in the name of and held by DTC or its nominee to DTC or its nominee, as the case may be, as the registered owner and holder of the global note.

        We expect that DTC or its nominee, upon receipt of any payment of principal or interest in respect of a global note, will credit participants' accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of the global note as shown on the records of DTC or its nominee. We also expect that payments by participants and indirect participants to owners of beneficial interests in a global note held through such participants will be governed by standing instructions and customary practices, as is now the case with securities held for accounts of customers registered in the names of nominees for these customers. The payments, however, will be the responsibility of the participants and indirect participants, and neither we, the trustee nor any paying agent will have any responsibility or liability for:

•

any aspect of the records relating to, or payments made on account of, beneficial ownership interests in a global note;

•

maintaining, supervising or reviewing any records relating to the beneficial ownership interests;

•

any other aspect of the relationship between DTC and its participants; or

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•

the relationship between the participants and indirect participants and the owners of beneficial interests in a global note.

        Unless and until it is exchanged in whole or in part for definitive notes, a global note may not be transferred except as a whole by DTC to a nominee of DTC or by a nominee of DTC to DTC or another nominee of DTC.

        Participants in DTC will effect transfers with other participants in the ordinary way in accordance with DTC rules and will settle transfers in same-day funds. If a holder requires physical delivery of a definitive note for any reason, including to sell notes to persons in jurisdictions which require physical delivery or to pledge notes, the holder must transfer its interest in a global note in accordance with the normal procedures of DTC and the procedures set forth in the Indenture.

        We expect that DTC will take any action permitted to be taken by a holder of notes, including the presentation of notes for exchange as described below, only at the direction of one or more participants to whose accounts at the DTC interests in a global note are credited and only in respect of the portion of the aggregate the principal amount of the notes as to which the participant or participants has or have given direction. However, if there is an event of default under the notes, DTC will exchange the global notes for definitive notes, which it will distribute to its participants. These definitive notes are subject to certain restrictions on registration of transfers and will bear appropriate legends restricting their transfer. Although we expect that DTC will agree to the foregoing procedures in order to facilitate transfers of interests in global notes among participants of DTC, DTC is under no obligation to perform or continue to perform these procedures, and these procedures may be discontinued at any time. Neither we nor the trustee have any responsibility for the performance by DTC or its participants or indirect participants of their obligations under the rules and procedures governing their operations.

        If DTC is at any time unwilling or unable to continue as a depositary for global notes or ceases to be a clearing agency registered under the Exchange Act and we do not appoint a successor depositary within 90 days, we will issue definitive notes in exchange for the global notes. The definitive notes will be subject to certain restrictions on registration of transfers and will bear appropriate legends concerning these restrictions.

Governing Law

        The indenture and the notes are governed by and construed in accordance with the laws of the State of New York without regard to principles of conflict of laws.

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DESCRIPTION OF CAPITAL STOCK

        Our authorized capital stock consists of 150.0 million shares of common stock, par value $0.10 per share, and 15.0 million shares of cumulative preference stock, par value $1.00 per share 575,000 shares of which are designated as Series A cumulative preference stock. At February 28, 2002, 42.7 million shares of common stock and no shares of cumulative preference stock were outstanding.

Common Stock

        Subject to the restrictions described below, the holders of our common stock are entitled to receive dividends from funds legally available when, as and if declared by our Board of Directors, and are entitled upon our liquidation, dissolution or winding up to receive pro rata our net assets after satisfaction in full of the prior rights of our creditors and holders of any cumulative preference stock. Our senior credit facilities, however, impose some limitations on our ability to pay to dividends.

        Except as otherwise provided by law or stated below, the holders of our common stock are entitled to one vote for each share held on all matters as to which shareholders are entitled to vote, voting jointly as a single class with the holders of shares of cumulative preference stock, without regard to series. The holders of our common stock do not have cumulative voting rights. The holders of our common stock do not have any preferential, subscriptive or preemptive rights to subscribe to or purchase any new or additional issue of shares of any class of stock or of securities convertible into our stock or any conversion rights with respect to any of our securities. Our common stock is not subject to redemption. All of our issued and outstanding common stock is fully paid and non-assessable.

Cumulative Preference Stock

        Our cumulative preference stock may be issued from time to time in one or more series with such distinctive serial designations as are fixed by our Board of Directors and with such rights, preferences and limitations as are fixed by the Board of Directors or required by law. Satisfaction of dividend preferences of any outstanding cumulative preference stock would reduce the amount of funds available for the payment of dividends on our common stock. In addition, holders of cumulative preference stock would be entitled to receive a preferential payment before any payment can be made to holders of common stock in the event of our voluntary or involuntary liquidation, dissolution or winding up.

        Subject to limited exceptions, in addition to the right to vote as a single class together with the common stock for the election of directors and on all other matters submitted to a vote of the holders of common stock including the lease, sale, exchange, transfer or other disposition of all or substantially all of our property, assets or business or our consolidation or merger with or into another corporation, the affirmative vote of the holders of a majority of the cumulative preference stock, voting separately as a class, and in some cases by series, is required to effect or validate some actions, including, among other things:

•

the authorization or creation of any stock, or any security convertible into stock, ranking prior to the cumulative preference stock,



•

an increase in the number of authorized shares of cumulative preference stock or of any other stock of any class ranking prior to or on a parity with the cumulative preference stock or of any security convertible into stock of any class ranking prior to or on parity with the cumulative preference stock, or



•

the sale, lease or conveyance of all or substantially all of our property or business, or a consolidation or merger with any other company.

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        The affirmative vote of the holders of a super majority of the cumulative preference stock, voting separately as a class, and in some cases by series, is required for the alteration, amendment, or repeal of any provision of our Articles of Incorporation or specified provisions our Code of Regulations which would adversely affect the rights or preferences of that stock or series.

        If the payment of six quarterly dividends, whether or not consecutive, is in default, the holders of the cumulative preference stock, voting separately as a class, in addition to all other voting rights, are entitled to call a special meeting of shareholders to elect two additional members to our Board of Directors. When all dividends on the cumulative preference stock in default have been paid, the holders power to elect the two additional directors at subsequent elections of directors becomes null and void unless and until a new default occurs. The holders of cumulative preference stock do not have cumulative voting rights or any preferential, subscriptive or preemptive rights to subscribe to or purchase any new or additional issue of shares of any class of stock or securities convertible into our stock.

        Although the cumulative preference stock is designed to give us more flexibility in meeting our financial needs from time to time, the issuance of cumulative preference stock could have anti-takeover effects. The authority of the Board of Directors to issue additional cumulative preference stock could be used to dilute stock ownership of a person or entity seeking to take control of our company. The cumulative preference stock could be issued to persons or entities who would support the Board of Directors in opposing a takeover bid that the Board determines is not in our best interests or the best interest of our shareholders and employees.

        The cumulative preference stock of any series may be redeemed in whole or in part, at our option, by vote of the Board of Directors, or by operation of any sinking fund provided for in any particular series of cumulative preference stock, at the time, or from time to time, at the redemption price or the respective redemption prices fixed by the Board of Directors or the sinking fund provisions as provided in the Articles of Incorporation upon notice given as provided in the Articles.

Shareholder Rights Plan

        In January 1997, the Board of Directors extended our Shareholder Rights Plan for 10 years. When the Shareholder Rights Plan was originally adopted in 1987, the directors declared a dividend of one Preferred Share Purchase Right, or Right, on each outstanding share of common stock, payable to shareholders of record on February 27, 1987. Rights outstanding as of November 30, 2001 and 2000 totaled 43.1 million and 42.4 million, respectively. The Shareholder Rights Plan provides that, under the circumstances described below, each Right will entitle shareholders to buy one one-hundredth of a share of a new Series A Cumulative Preference Stock at an exercise price of $100. The Rights are exercisable only if a person or group acquires 20% or more of our common stock or announces a tender or exchange offer that will result in the person or group acquiring 30% or more of the common stock. We are entitled to redeem the Rights at two cents per Right at any time until 10 days after a 20% position has been acquired, unless the Board of Directors elects to extend that time period. However, no extension may exceed 30 days. If we are involved in specified transactions after the Rights become exercisable, a holder of Rights, other than Rights beneficially owned by a shareholder who has acquired 20% or more of our common stock, which Rights become void in that circumstance, is entitled to buy a number of the acquiring company's common shares, or our common stock, the case may be, having a market value of twice the exercise price of each Right. The exercise or the Rights could, therefore, potentially have a dilutive effect. The Rights under the extended Shareholder Rights Plan expire on February 18, 2007. Until a Right is exercised, the holder has no rights as a stockholder including, without limitation, the right to vote as a shareholder or to receive dividends.

        As of November 30, 2001, 575,000 shares of $1.00 par value Series A Cumulative Preference Stock were reserved for issuance upon exercise of Preferred Share Purchase Rights.

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Anti-takeover Provisions in Our Charter and Bylaws

        Pursuant to our Articles of Incorporation, the Board of Directors is divided, with respect to the terms for which the directors severally hold office, into three classes as nearly equal in number as the total number of directors constituting the whole Board of Directors permits, with the three-year term of office of one class of directors expiring each year. This provision may be amended only by the affirmative vote of not less than 80% of our total voting power. In addition, our Code of Regulations, or by-laws, provide that:

•

directors may be removed, with or without cause, only by the affirmative vote of the holders of not less than 80% of our voting power entitled to elect directors in place of those being removed.



•

the Board of Directors may fix the number of directors within a range of seven to seventeen directors, to the extent consistent with applicable law, and



•

the size of the Board of Directors may be increased or decreased within that range only by the affirmative vote of a majority of the Board or by the holders of not less than 80% of our voting power

        Our Code of Regulations also contains provisions relating to the size of, and filling vacancies on, the Board of Directors and the removal of directors which may be amended only by the affirmative vote of not less than 80% of our voting power. Subject to compliance with this restriction, the provisions of our Code of Regulations may be amended at a meeting of the shareholders by the affirmative vote of the holders of record of shares entitling them to exercise a majority of the voting power on the proposal, or by the written consent of the holders of record of shares entitling them to exercise two-thirds of the voting power on such proposal, subject to certain exceptions.

        Although these provisions are intended to encourage potential acquiring persons to negotiate with our Board of Directors and to provide for continuity and stability of management, the combination of the provisions in our Articles of Incorporation and Code of Regulations may have an anti-takeover effect. By making it more time consuming for a substantial shareholder to gain control of the Board, these provisions may render more difficult, and may discourage, a proxy contest or the assumption of control of us or the removal of the incumbent Board of Directors.

Ohio Control Share Statute

        Section 1701.831 of the General Corporation Law of the State of Ohio requires the prior authorization of the shareholders of certain corporations in order for any person to acquire, either directly or indirectly, shares of that corporation that would entitle the acquiring person to exercise or direct the exercise of 20% or more of the voting power of that corporation in the election of directors or to exceed specified other percentages of voting power. In the event an acquiring person proposes to make such an acquisition, the person is required to deliver to the corporation a statement disclosing, among other things, the number of shares owned, directly or indirectly, by the person, the range of voting power that may result from the proposed acquisition and the identity of the acquiring person. Within 10 days after receipt of this statement, the corporation must call a special meeting of shareholders to vote on the proposed acquisition. The acquiring person may complete the proposed acquisition only if the acquisition is approved by the affirmative vote of the holders of at least a majority of the voting power of all shares entitled to vote in the election of directors represented at the meeting excluding the voting power of all "interested shares." Interested shares include any shares held by the acquiring person and those held by officers and directors of the corporation. Section 1701.831 does not apply to a corporation if its articles of incorporation or code of regulations state that the statute does not apply to a corporation. The Articles of Incorporation and Code of Regulations contain a provision opting out of this statute.

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        Chapter 1704 of the General Corporation Law of the State of Ohio prohibits certain corporations from engaging in a "chapter 1704 transaction" with an "interested shareholder" for a period of three years after the date of the transaction in which the person became an interested shareholder, unless, among other things:

•

the articles of incorporation expressly provide that the corporation is not subject to the statute, and we have not made this election, or



•

the board of directors of the corporation approves the chapter 1704 transaction or the acquisition of the shares before the date the shares were acquired. After the three-year moratorium period, the corporation may not consummate a chapter 1704 transaction unless, among other things, it is approved by the affirmative vote of the holders of at least two-thirds of the voting power in the election of directors and the holders of a majority of the voting shares, excluding all shares beneficially owned by an interested shareholder or an affiliate or associate of an interested shareholder, or the shareholders receive certain minimum consideration for their shares. A Chapter 1704 transaction includes certain mergers, sales of assets, consolidations, combinations and majority share acquisitions involving an interested shareholder. An interested shareholder is defined to include, with limited exceptions, any person who, together with affiliates and associates, is the beneficial owner of a sufficient number of shares of the corporation to entitle the person, directly or indirectly, alone or with others, to exercise or direct the exercise of 10% or more of the voting power in the election of directors after taking into account all of the person's beneficially owned shares that are not then outstanding. The application of Chapter 1704 and Section 1701.831 may have the effect of delaying, deferring or preventing a change of control involving our company.

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IMPORTANT UNITED STATES FEDERAL TAX CONSIDERATIONS

        The following is a discussion of the material United States federal income tax consequences to U.S. and non-U.S. holders, as defined below, and U.S. estate tax consequences to non-U.S. holders, relating to the purchase, ownership and disposition of the notes and of the common stock into which the notes may be converted. For purposes of this discussion, the Internal Revenue Service is referred to as the "IRS."

        This discussion:

•

does not purport to be a complete analysis of all the potential tax consequences that may be material to an investor based on its particular tax situation;



•

is based on the provisions of the Internal Revenue Code of 1986, as amended, which is referred to in this discussion as the "Code," the applicable Treasury Regulations promulgated or proposed under the Code, which are referred to in this discussion as the "Treasury Regulations," and judicial authority and current administrative rulings and practice, all of which are subject to change, possibly on a retroactive basis;



•

deals only with the beneficial owner, or "holder," of a note that will hold notes and common stock into which the notes may be converted as "capital assets" (within the meaning of Section 1221 of the Code);



•

does not address tax consequences applicable to holders that may be subject to special tax rules, such as banks, holders subject to the alternative minimum tax, tax-exempt organizations, nonresident aliens subject to the tax on expatriates under Section 877 of the Code, pension funds, insurance companies, dealers in securities or foreign currencies, traders who elect to mark to market their securities, persons that will hold notes as a position in a hedging or constructive sale transaction, "straddle" or "conversion" or other integrated transaction for tax purposes, or persons that have a "functional currency" other than the U.S. dollar; and



•

discusses only the tax consequences applicable to the initial investors purchasing the notes at their "issue price" as defined in Section 1273 of the Code and does not discuss the tax consequences applicable to subsequent purchasers of the notes.

        We have not sought any ruling from the IRS with respect to the statements made and the conclusions reached in the following discussion, and we cannot assure you that the IRS will agree with those statements and conclusions. In addition, the IRS may successfully assert a contrary position. This discussion does not consider the effect of any applicable foreign, state, local or other tax laws.

        As used in this prospectus, the term "U.S. holder" means a beneficial owner of a note or of common stock into which a note is converted that is, for United States federal income tax purposes:

•

a citizen or individual resident of the United States;



•

a corporation, or other entity treated as a corporation, created in or under the laws of the United States or of any state;



•

an estate the income of which is subject to United States federal income taxation regardless of its source; or



•

a trust if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more United States persons have the authority to control all substantial decisions, or a trust in existence on August 20, 1996 and treated as a United States person before this date that timely elected to continue to be treated as a United States person.

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        If a partnership holds notes, the tax treatment of a partner will generally depend on the status of the partner and upon the activities of the partnership. If you are a partner of a partnership holding notes, we suggest you consult your tax advisor.

        The term "non-U.S. holder" means any holder that is not a U.S. holder.

Investors considering the purchase of notes should consult their own tax advisors with respect to the application of the United States federal income and estate tax laws to their particular situations as well as any tax consequences arising under the laws of any state, local or foreign taxing jurisdiction or under any applicable tax treaty.

Federal Tax Considerations Applicable to U.S. Holders

        Interest on Notes.    Interest paid on the notes will be taxable to a U.S. holder as ordinary interest income when received or accrued, in accordance with the holder's method of tax accounting. In general, if a holder of a debt instrument may receive payments that exceed by more than a de minimus amount the issue price of the instrument, other than fixed periodic interest, the holder may be required to recognize additional interest as "original issue discount" over the term of the instrument. We believe that the notes will not be issued with original issue discount. We are obligated to pay liquidated damages to holders of the notes in circumstances described under "Description of the Notes." According to Treasury Regulations, the possibility of an additional payment on the notes will not affect the amount of interest income recognized by a holder, or the timing of this recognition, if the likelihood of the additional payment is remote as of the date of the debt obligations are issued. We believe that the likelihood of the payment of liquidated damages is remote and do not intend to treat this possibility as creating original issue discount on any note. Notwithstanding the above, if liquidated damages are paid, the payments will be treated by us as interest income to the holder. Similarly, we intend to take the position that the likelihood of a redemption or a repurchase upon a "change of control" is remote under the Treasury Regulations, and likewise we do not intend to treat the possibility of such a redemption or repurchase as creating original issue discount on any note.

        Constructive Dividend.    Some corporate transactions, such as distributions of assets to holders of common stock, may cause a deemed distribution to the holders of the notes if the conversion price or conversion ratio of the notes is adjusted to reflect the corporate transaction. These deemed distributions will be taxable as a dividend, return of capital or capital gain in accordance with the earnings and profits rules discussed under "—Dividends on Shares of Common Stock."

        Deductibility of Interest.    Generally, under Section 279 of the Code, an interest deduction may not be permitted with respect to some "corporate acquisition indebtedness." Corporate acquisition indebtedness includes any indebtedness that is:

•

issued to provide consideration for the direct or indirect acquisition of stock or assets of another corporation;



•

subordinated to the claims of trade creditors of the issuing corporation generally or expressly subordinated to any substantial amount of unsecured indebtedness, whether outstanding or subsequently issued, of the issuing corporation;



•

convertible directly or indirectly into the stock of the issuing corporation; and



•

issued by a corporation that has a debt to equity ratio that exceeds 2 to 1 or as to which the projected earnings do not exceed three times the annual interest to be paid or accrued by the corporation.

        Our ability to deduct all of the interest payable on the notes will depend on the application of the foregoing tests to us. The application of these rules is subject to uncertainties and depends on various factual matters, so that there is no assurance that Section 279 will not apply.

        Conversion of Notes.    A U.S. holder generally will not recognize any income, gain or loss upon conversion of a note into common stock, except to the extent the common stock is considered

43

attributable to accrued interest not previously included in income, which is taxable as ordinary income, or with respect to cash received instead of a fractional share of common stock. The holder's tax basis in common stock received upon conversion of a note will be the same as the holder's adjusted tax basis of the note at the time of conversion, reduced by any basis allocable to a fractional share interest, and the holding period of the common stock received upon conversion generally will include the holding period of the note converted. However, a holder's tax basis in shares of common stock considered attributable to accrued interest as described above generally will equal the amount of the accrued interest included in income, and the holding period for those shares will begin as of the date of conversion of the notes.

        Cash received instead of a fractional share of common stock upon conversion should be treated as a payment in exchange for the fractional share of common stock. Accordingly, the receipt of cash instead of a fractional share of common stock generally will result in capital gain or loss, measured by the difference between the cash received for the fractional share and the holder's adjusted tax basis in the fractional share.

        Dividends on Shares of Common Stock.    Distributions on shares of common stock will constitute dividends for U.S. federal income tax purposes to the extent of our current or accumulated earnings and profits as determined under U.S. federal income tax principles. Dividends paid to holders that are U.S. corporations may qualify for the dividends-received deduction.

        To the extent that a U.S. holder receives a distribution on shares of common stock that would otherwise constitute a dividend for U.S. federal income tax purposes but that exceeds our current and accumulated earnings and profits, the distribution will be treated first as a non-taxable return of capital reducing the holder's basis in the shares of common stock. Any distribution in excess of the holder's basis in the shares of common stock will be treated as capital gain.

        Sale or Exchange of Notes or Shares of Common Stock.    In general, a U.S. holder of notes will recognize gain or loss upon the sale, redemption, retirement or other disposition of the notes measured by the difference between:

•

the amount of cash and the fair market value of any property received, except to the extent attributable to the payment of accrued interest; and



•

the U.S. holder's tax basis in the notes.

A U.S. holder's tax basis in notes generally will equal the cost of the notes to the holder.

        In general, each U.S. holder of common stock into which the notes have been converted will recognize gain or loss upon the sale, exchange, redemption, or other disposition of the common stock under rules similar to those applicable to the notes. Special rules may apply to redemptions of the common stock which may result in an amount paid being treated as a dividend. Gain or loss on the disposition of the notes or shares of common stock will be capital gain or loss and will be long-term capital gain or loss if the holding period of the notes or the common stock disposed of exceeded one year.

Federal Tax Considerations Applicable to Non-U.S. Holders

        Interest on Notes.    Generally, interest paid on the notes to a non-U.S. holder will not be subject to U.S. federal income tax if:

•

the interest is not effectively connected with the conduct of a trade or business within the United States by the non-U.S. holder;



•

the non-U.S. holder does not actually or constructively own 10% or more of the total voting power of all classes of our stock entitled to vote and is neither a controlled foreign corporation with respect to which we are a "related person" within the meaning of the Code, nor a bank receiving interest described in Section 881(c)(3)(A) of the Code; and

44

•

the beneficial owner, under penalty of perjury, certifies that the beneficial owner is not a U.S. person and provides the beneficial owner's name and address.

        The certification described in the last clause above may be provided by a securities clearing organization, a bank or other financial institution that holds customers' securities in the ordinary course of its trade or business. Under Treasury regulations, the certification may also be provided by a qualified intermediary on behalf of one or more beneficial owners, or other intermediaries, provided that the intermediary has entered into a withholding agreement with the IRS and other conditions are met. A holder that is not exempt from tax under these rules will be subject to U.S. federal income tax withholding at a rate of 30% unless the interest is effectively connected with the conduct of a U.S. trade or business, in which case the interest will be subject to the U.S. federal income tax on net income that applies to U.S. persons generally. Corporate non-U.S. holders that receive interest income that is effectively connected with the conduct of a trade or business within the United States may also be subject to an additional "branch profits" tax on such income. Non-U.S. holders should consult applicable income tax treaties, which may provide reduced rates of withholding. A non-U.S. holder and any entities, partners, shareholders or other beneficiaries of non-U.S. holders may be required to satisfy certification requirements in order to claim a reduction of or exemption from withholding under applicable income tax treaties. A non-U.S. holder can meet the certification requirements under this paragraph by providing a form W-8 BEN or appropriate substitute to us or our agent.

        Constructive Dividend.    As discussed above, an adjustment to the conversion price of the notes could possibly give rise to a deemed distribution to holders of the notes. See "Federal Tax Considerations Applicable to U.S. Holders—Constructive Dividends" above. With respect to non-U.S. holders, the deemed distribution would be subject to the rules below regarding withholding of U.S. federal tax on dividends in respect of common stock. See "Federal Tax Considerations Applicable to Non-U.S. Holders—Dividends on Shares of Common Stock" below.

        Deductibility of Interest.    Deductibility of interest on the notes is discussed above.

        Conversion of Notes.    A non-U.S. holder generally will not be subject to U.S. federal income tax on the conversion of a note into shares of common stock. To the extent the common stock received on conversion is considered attributable to accrued interest not previously included in income, such stock will be treated as interest under the rules described above. See "Federal Tax Considerations Applicable to Non-U.S. Holders—Interest on Notes" above. To the extent a non-U.S. holder receives cash in lieu of a fractional share on conversion, such cash may give rise to gain that would be subject to the rules described below with respect to the sale or exchange of a note or common stock.

        Dividends on Shares of Common Stock.    Generally, any distribution on shares of common stock to a non-U.S. holder will be subject to U.S. federal income tax withholding at a rate of 30% unless the dividend is effectively connected with the conduct of a trade or business within the United States by the non-U.S. holder, in which case the dividend will be subject to the U.S. federal income tax on net income that applies to U.S. persons generally. Corporate non-U.S. holders that receive dividend income that is effectively connected with the conduct of a trade or business within the United States also may be subject to an additional "branch profits" tax on such income. Non-U.S. holders should consult any applicable income tax treaties, which may provide reduced rates of withholding. A non-U.S. holder and any entities, partners, shareholders or other beneficiaries of non-U.S. holders may be required to satisfy certification requirements in order to claim a reduction of or exemption from withholding under applicable income tax treaties.

45

        Sales or Exchange of Notes or Shares of Common Stock.    A non-U.S. holder generally will not be subject to U.S. federal income tax on gain recognized upon the sale or other disposition of the notes or shares of common stock unless:

•

the gain is effectively connected with the conduct of a trade or business within the United States by the non-U.S. holder; or



•

in the case of a non-U.S. holder who is a nonresident alien individual and holds the common stock as a capital asset, such holder is present in the United States for 183 or more days in the taxable year; or



•

if the rules of the Foreign Investment in Real Property Tax Act, or (FIRPTA), as described below, treat the gain as effectively connected with a U.S. trade or business; or



•

cash or common stock treated as issued for accrued interest would be treated as interest under the rules described above. See "Federal Tax Considerations Applicable to Non-U.S. Holders—Interest on Notes"

        Federal Estate Taxes.    A note beneficially owned by an individual who is a non-U.S. holder at the time of his or her death generally will not be subject to U.S. federal estate tax as a result of such individual's death, provided that:

•

the individual does not actually or constructively own 10% or more of the total combined voting power of all classes of stock entitled to vote within the meaning of Section 871(h)(3) of the Code; and



•

interest payments with respect to such note would not have been, if received at the time of the individual's death, effectively connected with the conduct of a U.S. trade or business by the individual.

        Common stock owned or treated as owned by an individual who is a non-U.S. holder at the time of his or her death will be included in such individual's estate for U.S. federal estate tax purposes and thus will be subject to U.S. federal estate tax, unless an applicable estate tax treaty provides otherwise.

        United States Real Property Holding Corporations.    The discussion of the United States taxation of non-U.S. holders of notes and common stock assumes that we are at no relevant time a United States real property holding corporation within the meaning of the Code. Under present law, we would not be a United States real property holding corporation so long as the fair market value of our United States real property interests is less than 50% of the sum of the fair market value of our United States real property interests, our interests in real property located outside the United States, and our other assets which are used or held or used in a trade or business on certain determination dates. We believe that we are not a United States real property holding corporation and do not expect to become such a corporation.

        If we become a United States real property holding corporation, gain recognized by non-U.S. holders on a disposition of notes or common stock would be subject to United States federal income tax, including applicable withholding tax, in certain circumstances.

46

Information Reporting and Backup Withholding

        U.S. Holders.    Information reporting and backup withholding may apply to payments of interest or dividends on or the proceeds of the sale or other disposition of the notes or shares of common stock made by us with respect to non-corporate U.S. holders. These holders generally will be subject to backup withholding currently at the rate of 30% unless the recipient of the payment supplies a taxpayer identification number and other information, certified under penalties of perjury, or otherwise establishes, in the manner prescribed by law, an exemption from backup withholding. Any amount withheld under backup withholding is allowable as a credit against the U.S. holder's federal income tax, upon furnishing the required information to the IRS.

        Non-U.S. Holders.    We will, where required, report to non-U.S. holders and to the IRS the amount of any principal, interest and dividends, if any, paid on the notes or shares of common stock. Under current United States federal income tax law, backup withholding tax will not apply to payments if the required certifications are received provided in each case that the payor, including a bank or its paying agent, as the case may be, does not have actual knowledge or reason to know that the payee is a United States person.

        Under Treasury Regulations, payments on the sale, exchange or other disposition of a note or shares of common stock effected at a foreign office of a broker to its customer generally are not subject to information reporting or backup withholding. However, if the broker is a United States person, a controlled foreign corporation, a foreign person 50% or more of whose gross income is effectively connected with a United States trade or business for a specified three-year period, a foreign partnership with significant United States ownership, or a United States branch of a foreign bank or insurance company, then information reporting will be required, unless the broker has in its records documentary evidence that the beneficial owner of the payment is not a United States person or is otherwise entitled to an exemption and the broker has no actual knowledge or reason to know that the beneficial owner is not entitled to an exemption. Backup withholding will apply if the sale is subject to information reporting and the broker has actual knowledge that the beneficial owner is a United States person.

        Information reporting and backup withholding will apply to payments effected at a Untied States office of any United States or foreign broker, unless the broker has in its records documentary evidence that the beneficial owner of the payment is not a United States person or is otherwise entitled to an exemption and the broker has no actual knowledge or reason to now that the beneficial owner is not entitled to an exemption.

        Backup withholding does not represent an additional income tax. Any amounts withheld from a payment to a non-U.S. holder under the backup withholding rules will be allowed as a credit against the holder's United States federal income tax liability and may entitle the holder to a refund, provided that the required information is furnished to the IRS.

47

SELLING SECURITYHOLDERS

        The notes were originally issued by us and sold to Deutsche Bank Securities Inc., Banc One Capital Markets, Inc. and ABN AMRO Rothschild LLC, to whom we refer to elsewhere in this prospectus as the "initial purchasers," in transactions exempt from the registration requirements of the federal securities laws. The initial purchasers resold the notes to persons reasonably believed by them to be "qualified institutional buyers," as defined by Rule 144A under the Securities Act. The selling securityholders, which term includes their transferees, pledges, donees or successors, may from time to time offer and sell pursuant to this prospectus any and all of the notes and the shares of common stock issuable upon conversion and/or redemption of the notes. Set forth below are the names of each selling securityholder, the principal amount of the notes that may be offered by such selling securityholder pursuant to this prospectus and the number of shares of common stock into which the notes are convertible, each to the extent known to us as of the date of this prospectus. Unless set forth below, none of the selling securityholders has had a material relationship with us or any of our predecessors or affiliates within the past three years.

        Any or all of the notes or common stock listed below may be offered for sale pursuant to this prospectus by the selling securityholders from time to time. Accordingly, no estimate can be given as to the amount of notes or common stock that will be held by the selling securityholders upon consummation of any particular sale. In addition, the selling securityholders identified below may have sold, transferred, or otherwise disposed of all or a portion of their notes since the date on which the information regarding their notes was provided in transactions exempt from the registration requirements of the Securities Act.

Name	Aggregate Principal Amount of Notes at Maturity that may be Sold		Percentage of Notes Outstanding		Common Stock Owned Prior to Conversion	Common Stock Registered Hereby(1)
Alpine Associates	$	10,000,000	6.7	%	—	542,888
Alpine Partners L.P.		700,000	*		—	38,002
American Samoa Government		17,000	*		—	922
Arkansas Teachers Retirement System		1,869,000	1.2	%	—	101,465
Bancroft Convertible Fund, Inc.		1,625,000	1.1	%	—	88,219
Baptist Health of South Florida		296,000	*		—	16,069
BP Amoco PLC Master Trust		623,000	*		—	33,821
Context Convertible Arbitrage Fund, L.P.		275,000	*		—	14,929
DeAm Convertirage Fund Ltd.		3,000,000	2.0	%	—	162,866
DKR Fixed Income Holding Fund Ltd.		3,000,000	2.0	%	—	162,866
Ellsworth Convertible Growth and Income Fund, Inc.		1,625,000	1.1	%	—	88,219
Engineers Joint Pension Fund		181,000	*		—	9,826
Grace Brothers Ltd.		1,000,000	*		—	54,288
Grace Brothers Management LLC		2,500,000	1.7	%	—	135,722
Innovest Finanzdienstleistungs AG		327,000	*		—	17,752
Jeffries & Company Inc.		4,000	*		—	217
JMG Capital Partners, LP		1,000,000	*		—	54,288
JMG Triton Offshore Fund, Ltd.		1,000,000	*		—	54,288
Lumberman's Mutual Casualty		269,000	*		—	14,603
McMahan Securities Co. L.P.		4,950,000	3.3	%	—	268,729
Motion Pictures Industry		297,000	*		—	16,123
Nicholas Applegate Convertible Fund		867,000	*		—	47,068
Palladin Securities LLC		500,000	*		—	27,144
Physicians Life		99,000	*		—	5,374

48

San Diego City Retirement		591,000	*		—	32,084
San Diego County Convertible		890,000	*		—	48,317
Screen Actors Guild Pension Convertible		272,000	*		—	14,766
SG Cowen Securities Corp.		15,500,000	10.3	%	—	841,476
Sunrise Partners LLC		7,000,000	4.7	%	—	380,021
The Class I C Company		2,250,000	1.5	%	—	122,149
The Estate of James Campbell		201,000	*		—	10,912
The Hotel Union and Hotel Industry of Hawaii Pension Plan		187,000	*		—	10,152
The James Campbell Corporation		150,000	*		—	8143
TQA Master Fund Ltd.		1,175,000	*		—	63,789
Viacom Inc. Pension Plan Master Trust		19,000	*		—	1031
Wake Forest University		359,000	*		—	19,489
WPG Convertible Arbitrage Overseas Master Fund, L.P.		3,000,000	2.0	%	—	162,866
Writers Guild — Industry Health Fund		160,000	*		—	8,686
Wyoming State Treasurer		523,000	*		—	28,393
Zurich Institutional Benchmarks Master Fund Ltd.		899,000	*		—	48,805
All other holders of notes or future transferees, pledgees, donees or successors of any such holders (2)(3)		80,800,000	53.9	%	—	4,386,535
Total (4)	$	150,000,000	100	%	—	8,143,320

*

Less than 1%.

(1)

Assumes conversion of all of the holder's notes at a conversion rate of 54.2888 shares of common stock per $1,000 principal amount at maturity of the notes. This conversion rate will be subject to adjustment as described under "Description of the Notes—Conversion Rights." As a result, the amount of common stock issuable upon conversion of the notes may increase or decrease in the future.

(2)

Information about other selling securityholders will be set forth in supplements or amendments to this prospectus, if required.

(3)

Assumes that any other holders of notes, or any future transferees, pledgees, donees or successors of or from any such other holders of notes, do not beneficially own any common stock other than the common stock issuable upon conversion of the notes at the initial conversion rate.

(4)

Amounts may not sum due to rounding.

49

        The preceding table has been prepared based upon information furnished to us by the selling securityholders named in the table. From time to time, additional information concerning ownership of the notes and common stock may be known by certain holders thereof not named in the preceding table, with whom we believe we have no affiliation. Information about the selling securityholders may change over time. Any changed information will be set forth in supplements or amendments to this prospectus.

PLAN OF DISTRIBUTION

        The notes and the common stock are being registered to permit public secondary trading of these securities by the holders thereof from time to time after the date of this prospectus. We have agreed, among other things, to bear all expenses, other than underwriting discounts and selling commissions, in connection with the registration and sale of the notes and the common stock covered by this prospectus.

        We will not receive any of the proceeds from the offering of notes or the common stock by the selling securityholders. We have been advised by the selling securityholders that the selling securityholders may sell all or a portion of the notes and common stock beneficially owned by them and offered hereby from time to time on any exchange on which the securities are listed on terms to be determined at the times of such sales. The selling securityholders may also make private sales directly or through a broker or brokers. Alternatively, any of the selling securityholders may from time to time offer the notes or the common stock beneficially owned by them through underwriters, dealers or agents, who may receive compensation in the form of underwriting discounts, commissions or concessions from the selling securityholders and the purchasers of the notes and the common stock for whom they may act as agent. The aggregate proceeds to the selling securityholders from the sale of the notes or common stock offering will be the purchase price of such notes or common stock less discounts and commissions, if any.

        The notes and common stock may be sold from time to time in one or more transactions at fixed offering prices, which may be changed, or at varying prices determined at the time of sale or at negotiated prices. These prices will be determined by the holders of such securities or by agreement between these holders and underwriters or dealers who may receive fees or commissions in connection therewith.

        These transactions may include block transactions or crosses. Crosses are transactions in which the same broker acts as an agent on both sides of the trade.

        In connection with sales of the notes and the underlying common stock or otherwise, the selling securityholders may enter into hedging transactions with broker-dealers. These broker-dealers may in turn engage in short sales of the notes and the underlying common stock in the course of hedging their positions. The selling securityholders may also sell the notes and underlying common stock short and deliver notes and the underlying common stock to close out short positions, or loan or pledge notes and the underlying common stock to broker-dealers that in turn may sell the notes and the underlying common stock.

        To our knowledge, there are currently no plans, arrangements or understandings between any selling securityholders and any underwriter, broker-dealer or agent regarding the sale of the notes and the underlying common stock by the selling securityholders. Selling securityholders may not sell any or all of the notes and the underlying common stock offered by them pursuant to this prospectus. In addition, we cannot assure you that any such selling securityholders will not transfer, devise or gift the notes and the underlying common stock by other means not described in this prospectus. In addition, any securities covered by this prospectus which qualify for sale pursuant to Rule 144 or

50

Rule 144A of the Securities Act may be sold under Rule 144 or Rule 144A rather than pursuant to this prospectus.

        Our outstanding common stock is listed for trading on the New York Stock Exchange and the Chicago Stock Exchange.

        The selling securityholders and any broker and any broker-dealers, agents or underwriters that participate with the selling securityholders in the distribution of the notes or the common stock may be deemed to be "underwriters" within the meaning of the Securities Act, in which event any commission received by such broker-dealers, agents or underwriters and any profit on the resale of the notes of the common stock purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act.

        In addition, in connection with any resales of the notes, any broker-dealer who acquired the notes for its own account as a result of market-making activities or other trading activities must deliver a prospectus meeting the requirements of the Securities Act. Broker-dealers may fulfill their prospectus delivery requirements with respect to the notes, other than a resale of an unsold allotment from the original sale of the outstanding notes, with this prospectus.

        The notes were issued and sold on April 5, 2002 and April 17, 2002 in transactions exempt from registration requirements of the federal securities laws to the initial purchasers. We have agreed to indemnify each initial purchaser, the directors, officers, partners, employees, representatives and agents of each initial purchaser and each selling securityholder including each person, if any, who controls any of them within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act, and each initial purchaser has agreed severally and not jointly, to indemnify us, our directors and officers and each person, if any, who controls us within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act against certain liabilities arising under the Securities Act.

        The selling securityholders and any other persons participating in the distribution will be subject to certain provisions under the federal securities laws, including Regulation M, which may limit the timing of purchases and sales of the notes and the underlying common stock by the selling securityholders and any other such person. In addition, Regulation M may restrict the ability of any person engaged in the distribution of the notes and the underlying common stock to engage in market-making activities with respect to the particular notes and the underlying common stock being distributed for a period of up to five business days prior to thc commencement of such distribution. This may affect the marketability of the notes and the underlying common stock and the ability of any person or entity to engage in market-making activities with respect to the notes and the underlying common stock.

        We have agreed to use our reasonable best efforts to keep the registration statement of which this prospectus is a part effective until April 17, 2004, or the earlier of (1) the sale pursuant to the registration statement of all the securities registered thereunder and (2) the expiration of the holding period applicable to such securities held by persons that are not our affiliates under Rule 144(k) under the Securities Act or any successor provision, subject to certain permitted exceptions in which case we may prohibit offers and sales of notes and common stock pursuant to the registration statement to which this prospectus relates.

LEGAL MATTERS

        Jones, Day, Reavis & Pogue will opine for us upon the validity of the notes and the shares of common stock issuable upon conversion of the notes.

51

EXPERTS

        Ernst & Young LLP, independent auditors, has audited our consolidated financial statements included in our Annual Report on Form 10-K for the year ended November 30, 2001, as set forth in their report, which is incorporated by reference in this prospectus and elsewhere in the registration statement. Our financial statements are incorporated by reference in reliance on Ernst & Young LLP's report, given on their authority as experts in accounting and auditing.

WHERE YOU CAN FIND MORE INFORMATION AND
INCORPORATION BY REFERENCE

        We are subject to the informational requirements of the Exchange Act and, in accordance with these requirements, we file reports, proxy statements and other information relating to our business, financial condition and other matters with the Securities and Exchange Commission. We are required to disclose in such reports certain information, as of particular dates, concerning our operating results and financial condition, officers and directors, principal holders of securities, any material interests of such persons in transactions with us and other matters. Reports, proxy statements and other information filed by us can be inspected and copied at the public reference facilities maintained by the Securities and Exchange Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549.

        Copies of such material can be obtained from the Public Reference Section of the Securities and Exchange Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates. The Securities and Exchange Commission also maintains a website that contains reports, proxy and information statements and other information regarding registrants like us that file electronically with the Securities and Exchange Commission. The address of such site is: http://www.sec.gov. Reports, proxy statements and other information concerning our business may also be inspected at the offices of the New York Stock Exchange at 20 Broad Street, New York, New York 10005. This information may also be obtained from us as described below.

        We incorporate by reference our documents listed below and any future filings that we make with the Securities and Exchange Commission on or after the date of this prospectus under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until completion of resale of all of the notes by the selling securityholders under this prospectus:

•

Our Annual Report on Form 10-K for the fiscal year ended November 30, 2001 (File No. 1-1520);



•

Our Annual Proxy Statement dated March 8, 2002 (File No. 1-1520);



•

Our Quarterly Report on Form 10-Q for the fiscal quarter ended February 28, 2002 (File No. 1-1520);



•

Our Current Reports on Form 8-K dated December 3, 2001, March 8, 2002, March 28, 2002, April 3, 2002, April 18, 2002, April 24, 2002 and May 20, 2002 (File No. 1-1520); and



•

the description of our capital stock contained in our Registration Statement on Form 10 dated May 20, 1935, as amended by Amendment No. 1 on Form 8, dated March 29, 1989 (File No. 1-1520).

        Any statement contained in a document all or a portion of which is incorporated or deemed to be incorporated by reference herein will be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any statement so modified will not be deemed to constitute a part of this prospectus,

52

except as so modified, and any statement so superseded will not be deemed to constitute a part of this prospectus.

        The information related to us contained in this prospectus should be read together with the information contained in the documents incorporated by reference.

        You may request a copy of these filings, or any or all of the documents incorporated into this prospectus by reference, other than exhibits to those documents unless the exhibits are specifically incorporated by reference into those documents, or referred to in this prospectus. Requests should be directed to:

GenCorp Inc.
P. O. Box 537012
Sacramento, California 95853-7012
Attention: Secretary
(916) 355-4000

53

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14. Other Expenses of Issuance and Distribution.

        Expenses payable in connection with the distribution of the securities being registered (estimated except for the registration fee), all of which will be borne by us, are as follows:

SEC Registration Fee	$	15,215
Legal Fees and Expenses	$	15,000
Miscellaneous Expenses	$	50,000
TOTAL	$	80,215

Item 15. Indemnification of Directors and Officers.

        Article Two, Section 10 of the Code of Regulations of the Registrant concerns indemnification of the Registrant's directors and officers and provides as follows:

        "The Corporation shall indemnify, to the full extent then permitted by law, any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he is or was a member of the Board of Directors or an officer, employee, member, manager or agent of the Corporation, or is or was serving at the request of the Corporation as a director, trustee, officer, employee or agent of another corporation, limited liability company, or a partnership, joint venture, trust or other enterprise. The Corporation shall pay, to the full extent then required by law, expenses, including attorney's fees, incurred by a member of the Board of Directors in defending any such action, suit or proceeding as they are incurred, in advance of the final disposition thereof, and may pay, in the same manner and to the full extent then permitted by law, such expenses incurred by any other person. The indemnification and payment of expenses provided hereby shall not be exclusive of, and shall be in addition to, any other rights granted to those seeking indemnification under any law, the Articles of Incorporation, any agreement, vote of shareholders or disinterested members of the Board of Directors, or otherwise, both as to action in official capacities and as to action in another capacity while he or she is a member of the Board of Directors, or an officer, employee or agent of the Corporation, and shall continue as to a person who has ceased to be a member of the Board of Directors, trustee, officer, employee or agent and shall inure to the benefit of the heirs, executors, and administrators of such a person.

        The Corporation may, to the full extent then permitted by law and authorized by the Board of Directors, purchase and maintain insurance or furnish similar protection, including but not limited to trust funds, letters of credit or self-insurance, on behalf of or for any persons described in the preceding paragraph against any liability asserted against and incurred by any such person in any such capacity, or arising out of his status as such, whether or not the Corporation would have the power to indemnify such person against such liability. Insurance may be purchased from or maintained with a person in which the Corporation has a financial interest.

        The Corporation, upon approval by the Board of Directors, may enter into agreements with any persons whom the Corporation may indemnify under this Code of Regulations or under law and undertake thereby to indemnify such persons and to pay the expenses incurred by them in defending any action, suit or proceeding against them, whether or not the Corporation would have the power under law or this Code of Regulations to indemnify any such person."

        Section 1701.13(E) of the Ohio General Corporation Law authorizes a corporation under certain circumstances to indemnify any director, trustee, officer, employee or agent in respect of expenses and other costs reasonably incurred by him in connection with any action, suit or proceeding to

II-1

which he is made a party or threatened to be made a party by reason of the fact that he was a director, trustee, officer, employee or agent of the corporation. In general, indemnification is permissible only if the person acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and in any criminal proceeding, had no reasonable cause to believe his conduct was unlawful, provided that indemnification is not permitted if the person is adjudged liable for negligence or misconduct in the performance of his duty to the corporation unless authorized by a court. To the extent that a director, trustee, officer, employee or agent has been successful in the defense of any such action, suit or proceeding, he is entitled to be indemnified against his reasonable expenses incurred in connection therewith by Section 1701.13(E)(3) of the Ohio General Corporation Law.

        The Registrant maintains and pays the premiums on contracts insuring the Registrant (with certain exclusions) against any liability to directors and officers it may incur under the above indemnity provisions and insuring each director and officer of the Registrant (with certain exclusions) against liability and expense, including legal fees, which he or she may incur by reason of his or her relationship to the Registrant, even if the Registrant does not have the obligation or right to indemnify such person against such liability or expense.

        The Registrant has entered into indemnity agreements with certain of its executive officers and directors to indemnify them against liability and expenses, including legal fees, which he or she may incur by reason of his or her relationship to the Registrant.

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Item 16. Exhibits and Financial Statement Schedules.

Exhibit Number	Description of Exhibit
4.1	Amended and Restated Rights Agreement (with exhibits) dated as of December 7, 1987 between GenCorp and Morgan Shareholder Services Trust Company as Rights Agent was filed as Exhibit D to the Company's Annual Report on Form 10-K for the fiscal year ended November 30, 1987 (File No. 1-1520), and is incorporated herein by reference.
4.2	Amendment to Rights Agreement among GenCorp, The First Chicago Trust Company of New York, as resigning Rights Agent and The Bank of New York, as successor Rights Agent, dated August 21, 1995 was filed as Exhibit A to the Company's Annual Report on Form 10-K for the fiscal year ended November 30, 1995 (File No. 1-1520), and is incorporated herein by reference.
4.3	Amendment to Rights Agreement between GenCorp and The Bank of New York as successor Rights Agent, dated as of January 20, 1997 was filed as Exhibit 4.1 to the Company's Current Report on Form 8-K Date of Report January 20, 1997 (File No. 1-1520), and is incorporated herein by reference.
4.4*	Indenture dated April 5, 2002 between GenCorp Inc. and The Bank of New York, as trustee relating to GenCorp's 5.75% Convertible Subordinated Notes due 2007
4.5*	Registration Rights Agreement dated April 5, 2002 by and among GenCorp Inc. Deutsche Bank Securities Inc., ABN AMRO Rothschild LLC and Banc One Capital Markets, Inc.
4.6*	Form of 5.75% Convertible Subordinated Notes (included in Exhibit 4.4)
5.1*	Opinion of Jones, Day, Reavis & Pogue
12.1*	Computation of Ratio of Earnings to Fixed Charges
23.1*	Consent of Ernst & Young LLP, Independent Auditors
23.2*	Consent of Jones, Day, Reavis & Pogue (included in Exhibit 5.1)
24.1*	Powers of Attorney
25.1*	Form of T-1 Statement of Eligibility of the Trustee under the Indenture

*

Filed herewith.

Item 17. Undertakings.

        We undertake:

        (1)  To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i)

To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;


(ii)

To reflect in the prospectus any facts or events arising after the effective date of this registration statement (or the most recent post-effective amendment thereof) that, individually or in the aggregate, represent a fundamental change in the information in this registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high and of the estimated maximum offering range may be reflected in the form of prospectus filed with the Securities and Exchange Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and

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(iii)

To include any material information with respect to the plan of distribution not previously disclosed in this registration statement or any material change to such information in this registration statement.

        However, paragraphs (1)(i) and (1)(ii) shall not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by us pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in this registration statement.

        (2)  That for the purpose of determining any liability under the Securities Act of 1933 each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide offering thereof.

        (3)  To remove from registration by means of post-effective amendment any of the securities being registered that remain unsold at the termination of the offering.

        We further undertake that, for purposes of determining any liability under the Securities Act of 1933, each filing of our annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in this registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide offering thereof.

        Insofar as indemnification for liabilities arising under the Securities Act, may be permitted to directors, officers or persons controlling us, pursuant to the provisions described under Item 15 above or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission the indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by us of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement on Form S-3 to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Rancho Cordova, in the State of California on June 3, 2002.

GENCORP INC.,
By:	/s/  TERRY L. HALL Terry L. Hall Senior Vice President and Chief Operating Officer

        Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement on Form S-3 has been signed below by the following persons in the capacities on June 3, 2002.

Signatures	Title
* Robert A. Wolfe	Chairman, Chief Executive Officer and President (Principal Executive Officer)
* Yasmin R. Seyal	Senior Vice President and Chief Financial Officer; Treasurer (Principal Financial and Accounting Officer)
* J. Robert Anderson	Director
* J. Gary Cooper	Director
* James J. Didion	Director
* Irving Gutin	Director

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* William K. Hall	Director
* James M. Osterhoff	Director
* Steven G. Rothmeier	Director
* Sheila E. Widnall	Director

*By:
/s/  TERRY L. HALLAttorney-in-Fact
Pursuant to Powers of Attorney
filed herewith or previously with
the Securities and Exchange Commission

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INDEX TO EXHIBITS

Exhibit Number	Description of Exhibit
4.4*	Indenture dated April 5, 2002 between GenCorp Inc. and The Bank of New York, as trustee relating to GenCorp's 5.75% Convertible Subordinated Notes due 2007
4.5*	Registration Rights Agreement dated April 5, 2002 by and among GenCorp Inc. Deutsche Bank Securities Inc., ABN AMRO Rothschild LLC and Banc One Capital Markets, Inc.
4.6*	Form of 5.75% Convertible Subordinated Notes (included in Exhibit 4.4)
5.1*	Opinion of Jones, Day, Reavis & Pogue
12.1*	Computation of Ratio of Earnings to Fixed Charges
23.1*	Consent of Ernst & Young LLP, Independent Auditors
23.2*	Consent of Jones, Day, Reavis & Pogue (included in Exhibit 5.1)
24.1*	Powers of Attorney
25.1*	Form of T-1 Statement of Eligibility of the Trustee under the Indenture

*

Filed herewith.

QuickLinks

TABLE OF CONTENTS
PROSPECTUS SUMMARY
Our Company
The Offering
Risk Factors
RISK FACTORS
NOTE REGARDING FORWARD-LOOKING STATEMENTS
RATIO OF EARNINGS TO FIXED CHARGES
USE OF PROCEEDS
PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY
CAPITALIZATION
DESCRIPTION OF NOTES
DESCRIPTION OF CAPITAL STOCK
IMPORTANT UNITED STATES FEDERAL TAX CONSIDERATIONS
SELLING SECURITYHOLDERS
PLAN OF DISTRIBUTION
LEGAL MATTERS
EXPERTS
WHERE YOU CAN FIND MORE INFORMATION AND INCORPORATION BY REFERENCE
PART II INFORMATION NOT REQUIRED IN PROSPECTUS
SIGNATURES
INDEX TO EXHIBITS

EX-4.4

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EXHIBIT 4.4

GENCORP INC.
5³/4% Convertible Subordinated Notes
Due 2007

INDENTURE
Dated as of April 5, 2002

THE BANK OF NEW YORK,
AS TRUSTEE

TABLE OF CONTENTS

		Page
ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE		1
	SECTION 1.1. DEFINITIONS	1
	SECTION 1.2. OTHER DEFINITIONS	7
	SECTION 1.3. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT	8
	SECTION 1.4. RULES OF CONSTRUCTION	8
ARTICLE 2. THE SECURITIES		8
	SECTION 2.1. DESIGNATION, FORM AND DATING	8
	SECTION 2.2. EXECUTION AND AUTHENTICATION	9
	SECTION 2.3. REGISTRAR, PAYING AGENT AND CONVERSION AGENT	9
	SECTION 2.4. PAYING AGENT TO HOLD MONEY IN TRUST	10
	SECTION 2.5. SECURITYHOLDER LISTS	11
	SECTION 2.6. TRANSFER AND EXCHANGE	11
	SECTION 2.7. REPLACEMENT SECURITIES	16
	SECTION 2.8. OUTSTANDING SECURITIES	17
	SECTION 2.9. TREASURY SECURITIES	17
	SECTION 2.10. TEMPORARY SECURITIES	17
	SECTION 2.11. CANCELLATION	17
	SECTION 2.12. CUSIP NUMBERS	18
ARTICLE 3. REDEMPTION AND REPURCHASE		18
	SECTION 3.1. OPTIONAL REDEMPTION BY THE COMPANY	18
	SECTION 3.2. SELECTION TO REDEEM; NOTICE TO TRUSTEE	18
	SECTION 3.3. SELECTION OF SECURITIES TO BE REDEEMED	18
	SECTION 3.4. NOTICE OF REDEMPTION	19
	SECTION 3.5. DEPOSIT OF REDEMPTION PRICE	20
	SECTION 3.6. SECURITIES PAYABLE ON REDEMPTION DATE	20
	SECTION 3.7. SECURITIES REDEEMED IN PART	20
	SECTION 3.8. CONVERSION ARRANGEMENT ON CALL FOR REDEMPTION	20
	SECTION 3.9. REPURCHASE OF SECURITIES AT OPTION OF THE HOLDER UPON CHANGE OF CONTROL.	21
	SECTION 3.10. NOTICE; METHOD OF EXERCISING REPURCHASE RIGHT	22
	SECTION 3.11. EFFECT OF REPURCHASE NOTICE	22
	SECTION 3.12. DEPOSIT OF REPURCHASE PRICE	23
	SECTION 3.13. SECURITIES REPURCHASED IN PART	23
	SECTION 3.14. COMPLIANCE WITH SECURITIES LAWS UPON REPURCHASE OF SECURITIES	24
	SECTION 3.15. REPAYMENT TO THE COMPANY	24
ARTICLE 4. CONVERSION		24
	SECTION 4.1. CONVERSION PRIVILEGE	24
	SECTION 4.2. CONVERSION PROCEDURE	25
	SECTION 4.3. ADJUSTMENTS BELOW PAR VALUE	25
	SECTION 4.4. TAXES ON CONVERSION	26
	SECTION 4.5. COMPANY TO PROVIDE STOCK	26

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	SECTION 4.6. ADJUSTMENT OF CONVERSION PRICE	26
	SECTION 4.7. NO ADJUSTMENT	30
	SECTION 4.8. EQUIVALENT ADJUSTMENTS	31
	SECTION 4.9. ADJUSTMENT FOR TAX PURPOSES	31
	SECTION 4.10. NOTICE OF ADJUSTMENT	31
	SECTION 4.11. NOTICE OF CERTAIN TRANSACTIONS	31
	SECTION 4.12. EFFECT OF RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE ON CONVERSION PRIVILEGE	32
	SECTION 4.13. TRUSTEE'S DISCLAIMER	32
	SECTION 4.14. VOLUNTARY REDUCTION	33
ARTICLE 5. SUBORDINATION		33
	SECTION 5.1. SECURITIES SUBORDINATED TO SENIOR INDEBTEDNESS	33
	SECTION 5.2. SECURITIES SUBORDINATED TO PRIOR PAYMENT OF ALL SENIOR INDEBTEDNESS ON DISSOLUTION, LIQUIDATION, REORGANIZATION, ETC., OF THE COMPANY	34
	SECTION 5.3. SECURITYHOLDERS TO BE SUBROGATED TO RIGHT OF HOLDERS OF SENIOR INDEBTEDNESS	35
	SECTION 5.4. OBLIGATIONS OF THE COMPANY UNCONDITIONAL	35
	SECTION 5.5. COMPANY NOT TO MAKE PAYMENT WITH RESPECT TO SECURITIES IN CERTAIN CIRCUMSTANCES	35
	SECTION 5.6. NOTICE TO TRUSTEE	36
	SECTION 5.7. APPLICATION BY TRUSTEE OF MONIES DEPOSITED WITH IT	37
	SECTION 5.8. SUBORDINATION RIGHTS NOT IMPAIRED BY ACTS OR OMISSIONS OF THE COMPANY OR HOLDERS OF SENIOR INDEBTEDNESS	37
	SECTION 5.9. TRUSTEE TO EFFECTUATE SUBORDINATION	37
	SECTION 5.10. RIGHT OF TRUSTEE TO HOLD SENIOR INDEBTEDNESS	38
	SECTION 5.11. ARTICLE 5 NOT TO PREVENT EVENTS OF DEFAULT	38
	SECTION 5.12. NO FIDUCIARY DUTY CREATED TO HOLDERS OF SENIOR INDEBTEDNESS	38
	SECTION 5.13. ARTICLE APPLICABLE TO PAYING AGENTS	38
	SECTION 5.14. CERTAIN CONVERSION DEEMED PAYMENT	38
	SECTION 5.15. CONTRACTUAL SUBORDINATION	39
ARTICLE 6. COVENANTS		39
	SECTION 6.1. PAYMENT OF SECURITIES	39
	SECTION 6.2. SEC REPORTS; 144A INFORMATION	39
	SECTION 6.3. LIQUIDATION	41
	SECTION 6.4. COMPLIANCE CERTIFICATES	41
	SECTION 6.5. NOTICE OF DEFAULTS	41
	SECTION 6.6. PAYMENT OF TAXES AND OTHER CLAIMS	41
	SECTION 6.7. CORPORATE EXISTENCE	42
	SECTION 6.8. MAINTENANCE OF PROPERTIES	42
	SECTION 6.9. FURTHER INSTRUMENTS AND ACTS	42

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	SECTION 6.10. MAINTENANCE OF OFFICE OR AGENCY	42
	SECTION 6.11. RESALE OF CERTAIN SECURITIES; REPORTING ISSUER	42
	SECTION 6.12. REGISTRATION RIGHTS	43
	SECTION 6.13. LIQUIDATED DAMAGES	43
	SECTION 6.14. STAY, EXTENSION AND USURY LAWS	44
ARTICLE 7. SUCCESSOR CORPORATION		44
	SECTION 7.1. WHEN COMPANY MAY MERGE, ETC	44
	SECTION 7.2. SUCCESSOR CORPORATION SUBSTITUTED	44
ARTICLE 8. DEFAULT AND REMEDIES		45
	SECTION 8.1. EVENTS OF DEFAULT	45
	SECTION 8.2. ACCELERATION	46
	SECTION 8.3. OTHER REMEDIES	46
	SECTION 8.4. WAIVER OF DEFAULTS AND EVENTS OF DEFAULT	47
	SECTION 8.5. CONTROL BY MAJORITY	47
	SECTION 8.6. LIMITATION ON SUITS	47
	SECTION 8.7. RIGHTS OF HOLDERS TO RECEIVE PAYMENT	47
	SECTION 8.8. COLLECTION SUIT BY TRUSTEE	48
	SECTION 8.9. TRUSTEE MAY FILE PROOFS OF CLAIM	48
	SECTION 8.10. PRIORITIES	48
	SECTION 8.11. UNDERTAKING FOR COSTS	49
	SECTION 8.12. RESTORATION OF RIGHTS AND REMEDIES	49
	SECTION 8.13. RIGHTS AND REMEDIES CUMULATIVE	49
	SECTION 8.14. DELAY OR OMISSION NOT WAIVER	49
ARTICLE 9. TRUSTEE		50
	SECTION 9.1. DUTIES OF TRUSTEE	50
	SECTION 9.2. RIGHTS OF TRUSTEE	50
	SECTION 9.3. INDIVIDUAL RIGHTS OF TRUSTEE	51
	SECTION 9.4. TRUSTEE'S DISCLAIMER	52
	SECTION 9.5. NOTICE OF DEFAULT OR EVENTS OF DEFAULT	52
	SECTION 9.6. REPORTS BY TRUSTEE TO HOLDERS	52
	SECTION 9.7. COMPENSATION AND INDEMNITY	52
	SECTION 9.8. REPLACEMENT OF TRUSTEE	53
	SECTION 9.9. SUCCESSOR TRUSTEE BY MERGER, ETC	53
	SECTION 9.10. ELIGIBILITY; DISQUALIFICATION	53
	SECTION 9.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY	55
ARTICLE 10. SATISFACTION AND DISCHARGE OF INDENTURE		55
	SECTION 10.1. TERMINATION OF COMPANY'S OBLIGATIONS	55
	SECTION 10.2. APPLICATION OF TRUST MONEY	55
	SECTION 10.3. REPAYMENT TO COMPANY	56
	SECTION 10.4. REINSTATEMENT	56
ARTICLE 11. AMENDMENTS, SUPPLEMENTS AND WAIVERS		56

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	SECTION 11.1. WITHOUT CONSENT OF HOLDERS	56
	SECTION 11.2. WITH CONSENT OF HOLDERS	56
	SECTION 11.3. COMPLIANCE WITH TRUST INDENTURE ACT	57
	SECTION 11.4. REVOCATION AND EFFECT OF CONSENTS	57
	SECTION 11.5. NOTATION ON OR EXCHANGE OF SECURITIES	58
	SECTION 11.6. TRUSTEE TO SIGN AMENDMENTS, ETC.; NOTICES	58
ARTICLE 12. MISCELLANEOUS		58
	SECTION 12.1. TRUST INDENTURE ACT CONTROLS	58
	SECTION 12.2. NOTICES	59
	SECTION 12.3. COMMUNICATIONS BY HOLDERS WITH OTHER HOLDERS	59
	SECTION 12.4. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT	60
	SECTION 12.5. RECORD DATE FOR VOTE OR CONSENT OF SECURITYHOLDERS	60
	SECTION 12.6. RULES BY TRUSTEE, PAYING AGENT, REGISTRAR	60
	SECTION 12.7. LEGAL HOLIDAYS	60
	SECTION 12.8. GOVERNING LAW	61
	SECTION 12.9. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS	61
	SECTION 12.10. NO RECOURSE AGAINST OTHERS	61
	SECTION 12.11. SUCCESSORS	61
	SECTION 12.12. MULTIPLE COUNTERPARTS	61
	SECTION 12.13. REPARABILITY	61
	SECTION 12.14. TABLE OF CONTENTS, HEADINGS, ETC	61

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        INDENTURE dated as of April 5, 2002 between GenCorp Inc., an Ohio corporation (the "Company"), and The Bank of New York, as trustee (the "Trustee").

        Both parties agree as follows for the benefit of the other and for the equal and ratable benefit of the registered holders of the Company's 5³/4% Convertible Subordinated Notes Due 2007.

ARTICLE 1.

DEFINITIONS AND INCORPORATION BY REFERENCE

SECTION 1.1.    DEFINITIONS.

        The terms defined in this Section 1.1 (except as herein otherwise expressly provided or unless the context otherwise requires) for all purposes of this Indenture and of any indenture supplemental hereto shall have the respective meanings specified in this Section 1.1.

        "Affiliate" of any specified person means any other person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified person. For the purposes of this definition, "control" when used with respect to any person means the power to direct the management and policies of such person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing.

        "Agent" means any Registrar, Paying Agent or Conversion Agent.

        "Beneficial Owner" shall be determined in accordance with Rules 13d-3 and 13d-5 promulgated by the SEC under the Exchange Act, or any successor provision, except that a person shall be deemed to be the "beneficial owner" of all securities that such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time.

        "Board of Directors" means the Board of Directors of the Company or any authorized committee of the Board of Directors.

        "Board Resolution" means a copy of a resolution certified by the secretary or an assistant secretary of such Person to have been duly adopted by the Board of Directors of such Person or any duly authorized committee thereof and to be in full force and effect on the date of such certification, and delivered to the Trustee.

        "Business Day" means a day that is not a Legal Holiday.

        "Cash" or "cash" means such coin or currency of the United States as at any time of payment is legal tender for the payment of public and private debts.

        "Closing Price" with respect to any securities on any day shall mean the closing sale price regular way on such day or, in case no such sale takes place on such day, the average of the reported closing bid and asked prices, regular way, in each case on the principal national security exchange or quotation system on which such security is quoted or listed or admitted to trading,

2

or, if not quoted or listed or admitted to trading on any national securities exchange or quotation system, the average of the closing bid and asked prices of such security on the over-the-counter market on the day in question as reported by the National Quotation Bureau Incorporated, or a similar generally accepted reporting service, or if not so available, in such manner as furnished by any New York Stock Exchange member firm selected from time to time by the Board of Directors for that purpose, or a price determined in good faith by the Board of Directors or, to the extent permitted by applicable law, a duly authorized committee thereof, whose determination shall be conclusive.

        "Common Stock" means any stock of any class of the Company which has no preference in respect of dividends or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company and which is not subject to redemption by the Company. Subject to the provisions of Section 4.12, however, shares issuable on conversion of Securities shall include only shares of Common Stock, $0.10 par value per share (which is the class designated as Common Stock of the Company at the date of this Indenture), or shares of any class or classes resulting from any reclassification or reclassifications thereof and which have no preference in respect of dividends or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company and which are not subject to redemption by the Company; provided that if at any time there shall be more than one such resulting class, the shares of each such class then so issuable shall be substantially in the proportion to which the total number of shares of such class resulting from all such reclassifications bears to the total number of shares of all such classes resulting from all such reclassifications.

        "Company" means the party named as such in this Indenture until a successor replaces it pursuant to this Indenture and thereafter means the successor. The foregoing sentence shall likewise apply to any subsequent successor or successors.

        "Consolidated Net Worth" means, with respect to any Person, the consolidated stockholders' equity (excluding any capital stock that by its terms is, or upon the happening of an event or passage of time would be, required to be redeemed prior to the maturity of the Securities or is redeemable at the option of the holder thereof at any time prior to such maturity or is convertible or exchangeable for debt securities at any time prior to such maturity at the option of the holder thereof) of such Person and its consolidated subsidiaries, as determined in accordance with generally accepted accounting principles.

        "Continuing Directors" means, as of any date of determination, any member of the Board of Directors of the Company who (i) was a member of such Board of Directors on the date of the original issuance of the Securities or (ii) was nominated for election or elected to the Board of Directors with the approval of a majority of the Continuing Directors who were members of such Board of Directors at the time of such nomination or election.

        "Corporate Trust Office" of the Trustee means the principal office of the Trustee at which at any time its corporate trust business shall be administered, which office initially is located at 101 Barclay Street, New York 10286, Attn: Corporate Trust Division or such other address as the Trustee may designate from time to time by notice to the Company or the

3

principal corporate trust office of any successor Trustee (or such other address as a successor Trustee may designate from time to time by notice to the Company).

        "Credit Agreement" means the Credit Agreement dated as of December 28, 2000 among the Company, as the borrower and Deutsche Bank Trust Company Americas (formerly Bankers Trust Company) for itself and as administrative agent for the other lenders party thereto from time to time, as such agreement has been or may be amended (including any amendment or restatement thereof), supplemented, or otherwise modified from time to time (including any agreement extending the maturity of, refinancing, replacing or otherwise restructuring (including increasing the amount of available borrowings thereunder) all or any provision of the indebtedness under such agreement or any successor or replacement agreement and whether by the same or other agent, lender or group of lenders).

        "DBSI" means Deutsche Bank Securities Inc.

        "Default" or "default" means any event which is, or after notice or passage of time, or both, would be, an Event of Default.

        "Depositary" means, with respect to the Securities issuable or issued in whole or in part in global form, The Depository Trust Company as the Depositary with respect to the Securities, until a successor shall have been appointed and becomes such pursuant to the applicable provisions of this Indenture, and thereafter, "Depositary" shall mean or include such successor.

        "Designated Senior Indebtedness" means (i) indebtedness under or in respect of the Credit Agreement, and (ii) any other indebtedness constituting Senior Indebtedness which, at the time of determination, has an aggregate principal amount of at least $25 million and is specifically designated in the instrument evidencing such Senior Indebtedness as "Designated Senior Indebtedness" for purposes of this Indenture. The instrument, agreement or other document evidencing any Designated Senior Indebtedness may place limitations and conditions on the right of such Senior Indebtedness to exercise the rights of Designated Senior Indebtedness provided under this Indenture.

        "Exchange Act" means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

        "Holder" or "Securityholder" means the person in whose name a Security is registered on the Registrar's books.

        "Indenture" means this Indenture as amended or supplemented from time to time.

        "Initial Purchasers" means Deutsche Bank Securities Inc., Banc One Capital Markets, Inc. and ABN AMRO Rothschild LLC as initial purchasers under the Purchase Agreement.

        "Instrument" means any agreement, indenture, instrument or other document under which any obligation is evidenced, assumed, guaranteed or secured.

4

        "Market Capitalization" means an amount determined by multiplying the number of shares of Common Stock outstanding on the applicable date by the current market price of the Common Stock (determined as provided in Section 4.6(f)) as of such date.

        "Officer" means the Chairman of the Board, the President, any Vice President, the Chief Executive Officer, the Chief Operating Officer, the Chief Financial Officer, the General Counsel, the Treasurer or the Secretary of the Company.

        "Officers' Certificate" means a certificate signed by two Officers of the Company; provided, however, that for purposes of Section 6.4 "Officers' Certificate" means a certificate signed by the principal executive officer, principal financial officer or principal accounting officer of the Company.

        "Opinion of Counsel" means a written opinion from legal counsel who is reasonably acceptable to the Trustee. The counsel may be an employee of or counsel to the Company.

        "Payment Dates" means April 15 and October 15, the payment dates of the Securities.

        "Payment Default" means any default in the payment of principal of (or premium, if any) or interest on Senior Indebtedness.

        "Payment in full" or "paid in full" means payment in full in cash.

        "Person" or "person" means any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization or government or other agency or political subdivision thereof.

        "PORTAL Market" means the Private Offerings, Resales and Trading through Automated Linkages Market operated by the National Association of Securities Dealers, Inc. or any successor thereto.

        "Principal" or "principal" of a debt security, including the Securities, means the principal of the security plus, when appropriate, the premium, if any, on the security.

        "Purchase Agreement" means the Purchase Agreement dated April 2, 2002 by and among the Company and the Initial Purchasers.

        "Purchase Option" means the option to purchase up to $25,000,000 in aggregate principal amount of Securities granted by the Company to DBSI pursuant to Section 2(c) of the Purchase Agreement.

        "QIB" means a "Qualified Institutional Buyer" as that term is defined in Rule 144A.

        "Record Dates" means March 31 and September 30, the record dates of the Securities.

        "Redemption Date" or "redemption date," when used with respect to any Security to be redeemed, means the date fixed for such redemption pursuant to this Indenture, as set forth in the form of Security annexed as Exhibit A hereto.

5

        "Redemption Price" or "redemption price," when used with respect to any Security to be redeemed, means the price fixed for such redemption pursuant to this Indenture, as set forth in the form of Security annexed as Exhibit A hereto.

        "Registration Rights Agreement" means the Registration Rights Agreement dated as of the date hereof between the Company and the Initial Purchasers and certain permitted assigns.

        "Regulation S" means Regulation S promulgated under the Securities Act.

        "Representative" means the indenture trustee or other trustee, agent or representative for any class of Senior Indebtedness.

        "Rule 144" means Rule 144 as promulgated under the Securities Act (or any successor provision) as it may be amended from time to time.

        "Rule 144A" means Rule 144A as promulgated under the Securities Act (or any successor provision) as it may be amended from time to time.

        "SEC" or "Commission" means the Securities and Exchange Commission.

        "Securities" means the 5³/4% Convertible Subordinated Notes Due 2007 or any of them (each a "Security"), as amended or supplemented from time to time, that are issued under this Indenture.

        "Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

        "Senior Agent" means, on any date, the Representative of the class of Senior Indebtedness having the highest principal amount (including all revolving credit, letter of credit and other working capital commitments) then outstanding.

        "Senior Indebtedness" means the principal of and premium, if any, and interest on, and fees, costs, enforcement expenses, collateral protection expenses and other reimbursement or indemnity obligations in respect of and any other payments due pursuant to any of the following, whether outstanding as of the date of this Indenture or incurred or created thereafter, unless, in the case of any particular indebtedness, the instrument creating or evidencing the same or pursuant to which the same is outstanding expressly provides that such indebtedness shall not be senior in right of payment to the Securities, and includes:

•

all indebtedness, obligations and other liabilities, contingent or otherwise, of the Company for money borrowed that is evidenced by a note, bond, debenture, loan agreement, or similar instrument or agreement including, without limitation, all amounts outstanding from time to time under the Credit Agreement;



•

all of noncontingent obligations of the Company (i) for the reimbursement of any obligor on any letter of credit, banker's acceptance or similar credit transaction, (ii) under interest rate swaps, caps, collars, options, and similar arrangements,

6

and (iii) under any foreign exchange contract, currency swap agreement, futures contract, currency option contract or other foreign currency hedge;

•

all obligations of the Company for the payment of money relating to capital lease obligations;



•

any liabilities of the Subsidiaries described in the preceding clauses that the Company has guaranteed or which are otherwise the legal liability of the Company; and



•

renewals, extensions, refundings, refinancings, restructurings, amendments and modifications of any such obligations;

provided, however, that in no event shall "Senior Indebtedness" include (i) indebtedness or other obligations owed by the Company to any of the Subsidiaries or Affiliates, (ii) trade account payables incurred in the ordinary course of business, (iii) any liabilities for taxes owed or owing by the Company or any of the Subsidiaries, or (iv) the obligations of the Company under the Securities.

        "Significant Subsidiary" means any Subsidiary or group of Subsidiaries which has (i) consolidated assets or in which the Company and its other Subsidiaries have investments, equal to or greater than 10% of the total consolidated assets of the Company at the end of its most recently completed fiscal year; or (ii) consolidated gross revenue equal to or greater than 10% of the consolidated gross revenue of the Company for its most recently completed fiscal year.

        "Subsidiary" means any corporation, association or other business entity of which at least a majority of the total capital stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by the Company or one or more of the Company's other Subsidiaries or a combination thereof.

        "TIA" means the Trust Indenture Act of 1939, as amended by the Trust Indenture Reform Act of 1990 and as in effect on the date of this Indenture, except as provided in Section 11.3, and except to the extent any amendment to the Trust Indenture Act expressly provides for application of the Trust Indenture Act as in effect on another date.

        "Transfer Restricted Security" means securities that bear or are required to bear the legend set forth in Section 2.6(c) or (d).

        "Trust Officer" means any officer in the Corporate Trust Office of the Trustee, including any vice president, assistant vice president, assistant treasurer, trust officer or any other officer customarily performing functions similar to those performed by any of the above-designated officers who shall, in any case, be responsible for the administration of this Indenture or have familiarity with it, and also means, with respect to a particular corporate matter, any other officer of the Trustee to whom corporate trust matters are referred because of his knowledge of and familiarity with the particular subject.

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        "Trustee" means The Bank of New York until a successor replaces it in accordance with the provisions of this Indenture and thereafter means the successor The foregoing sentence shall likewise apply to any subsequent successor or successors.

        "U.S. Person" has the meaning specified in Regulation S.

        "Voting Stock" means stock or securities of the class or classes pursuant to which the holders thereof have the general voting power under ordinary circumstances to elect at least a majority of the board of directors, managers or trustees of a person (irrespective of whether or not at the time stock of any other class or classes shall have or might have voting power by reason of the happening of any contingency).

SECTION 1.2. OTHER DEFINITIONS.

Defined Term	Section
"Bankruptcy Law"	8.1
"Change of Control"	3.9
"Company Notice"	3.10(a)
"Company Order"	2.2
"Conversion Agent"	2.3
"Conversion Price"	4.6
"Conversion Shares"	4.1
"Custodian"	8.1
"Event of Default"	8.1
"Global Note"	2.6(a)
"Group"	3.9(1)
"Legal Holiday"	12.7
"Liquidated Damages"	6.12(a)
"Notice Date"	3.1(a)
"Optional Redemption"	3.1
"Paying Agent"	2.3
"Payment Blockage Period"	5.5
"Payment of the Securities"	5.5
"Purchase Party"	3.8
"Registrar"	2.3
"Registration Default"	6.12
"Registration Statement"	6.12(a)
"Repurchase Date"	3.9
"Repurchase Price"	3.9
"Repurchase Notice"	3.10(b)
"Restricted Securities"	2.6(c)
"Stockholder Rights Plan"	4.6(g)
"Trading Days"	4.6(f)
"Trigger Event"	4.6(g)
"U.S. Government Obligations"	10.1

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SECTION 1.3.    INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.

        This Indenture is hereby made subject to, and shall be governed by, the provisions of the TIA required to be part of and to govern indentures qualified under the TIA. The following TIA terms used in this Indenture have the following meanings:

        "Commission" means the SEC.

        "indenture securities" means the Securities.

        "indenture security holder" means a Securityholder.

        "indenture to be qualified" means this Indenture.

        "indenture trustee" or "institutional trustee" means the Trustee.

        "obligor" on the indenture securities means the Company or any other obligor on the Securities.

        All other terms used in this Indenture that are defined in the TIA, defined by a TIA reference to another statute or defined by SEC rule and not otherwise defined herein have the meanings assigned to them therein.

SECTION 1.4.    RULES OF CONSTRUCTION.

        Unless the context otherwise requires:

(1)

a term has the meaning assigned to it;



(2)

an accounting term not otherwise defined has the meaning assigned to it in accordance with generally accepted accounting principles in effect on the date hereof, and any other reference in this Indenture to "generally accepted accounting principles" refers to generally accepted accounting principles in effect on the date hereof;



(3)

"or" is not exclusive;



(4)

words in the singular include the plural, and words in the plural include the singular;



(5)

definitions are equally applicable to the masculine as well as to the feminine and neuter genders of such terms;



(6)

provisions apply to successive events and transactions; and



(7)

"herein," "hereof" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision.

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ARTICLE 2.

THE SECURITIES

SECTION 2.1.    DESIGNATION, FORM AND DATING.

        The Securities shall be designated as the 5³/4% Convertible Subordinated Notes Due 2007. Other than as provided in Section 2.6, the Securities and the Trustee's certificate of authentication to be borne by the Securities shall be substantially in the form of Exhibit A attached hereto, which is incorporated in and made part of this Indenture. The Company and the Trustee, by their execution and delivery of this Indenture, expressly agree to the terms and provisions of the Securities and to be bound thereby. In addition to such legends as may be required pursuant to Section 2.6, any of the Securities may have imprinted thereon such legends or endorsements as the officers executing the same may approve (execution thereof to be conclusive evidence of such approval) and as are not inconsistent with the provisions of this Indenture, or as may be required to comply with any law or with any rule or regulation made pursuant thereto or with any rule or regulation of any stock exchange on which the Securities may be listed or any trading system on which the Securities may be admitted, or to conform to usage. Each Security shall be dated the date of its authentication.

SECTION 2.2.    EXECUTION AND AUTHENTICATION.

        Two Officers of the Company shall sign the Securities for the Company by manual or facsimile signature. If an Officer whose signature is on a Security no longer holds that office at the time the Trustee authenticates the Security, the Security shall be valid nevertheless. A Security shall not be valid until an authorized signatory of the Trustee manually signs the certificate of authentication on the Security, which signature shall be conclusive evidence that the Security has been authenticated under this Indenture.

        The Trustee shall authenticate and make available for delivery Securities for original issue in the aggregate principal amount of up to $125,000,000, upon a written order or orders of the Company signed by two Officers or by an Officer and an Assistant Treasurer or Assistant Secretary of the Company (a "Company Order"). The Company Order shall specify the amount of Securities to be authenticated and the date on which the original issue of Securities is to be authenticated. Upon the exercise of the Purchase Option by DBSI, additional Securities in the aggregate principal amount of up to $25,000,000 shall be executed by the Company in the aforementioned manner and delivered to the Trustee for authentication, and shall thereupon be authenticated and delivered by the Trustee upon Company Order. The aggregate principal amount of Securities outstanding under this Indenture at any time may not exceed $150,000,000, except as provided in Section 2.7.

        The Trustee shall act as the initial authenticating agent. Thereafter, the Trustee may appoint an authenticating agent acceptable to the Company to authenticate Securities. An authenticating agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as an Agent to deal with the Company or an Affiliate of the Company.

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        The Securities shall be issuable only in registered form without coupons only in denominations of $1,000 and any integral multiple thereof.

SECTION 2.3.    REGISTRAR, PAYING AGENT AND CONVERSION AGENT.

        The Company shall maintain an office or agency where Securities may be presented for registration of transfer or for exchange (the "Registrar"), an office or agency where Securities may be presented for payment (the "Paying Agent"), an office or agency where Securities may be presented for conversion (the "Conversion Agent") and an office or agency for service of notices and demands to or upon the Company in respect of the Securities and this Indenture may be served. The Registrar shall keep a register of the Securities and of their transfer and exchange. The Company may have one or more co-Registrars, one or more additional Paying Agents and one or more additional Conversion Agents. The term "Registrar" includes any co-Registrar, the term "Paying Agent" includes any additional Paying Agent and the term "Conversion Agent" includes any additional Conversion Agent.

        The Company shall enter into an appropriate agency agreement with any Agent not a party to this Indenture. The agreement shall implement the provisions of this Indenture that relate to such Agent. The Company shall notify the Trustee of the name and address of any Agent not a party to this Indenture. If the Company fails to maintain a Registrar, Paying Agent or a Conversion Agent or fails to give the foregoing notice, the Trustee shall act as such. The Company or any Affiliate of the Company may act as Paying Agent (except for the purposes of Section 6.3 and Article 10), Registrar or Conversion Agent.

        The Company initially appoints the Trustee as Registrar, Paying Agent and Conversion Agent in connection with the Securities.

SECTION 2.4.    PAYING AGENT TO HOLD MONEY IN TRUST.

        If the Company shall at any time act as its own Paying Agent, it will, on or before each due date of the principal of and premium, if any, or interest (together with any Liquidated Damages in respect thereof) on any of the Securities, segregate and hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay the principal of, premium, if any, or interest on any of the Securities (together with any Liquidated Damages in respect thereof) so becoming due until such sums shall be paid to such Persons or otherwise disposed of as herein provided and will promptly notify the Trustee of its action or failure so to act.

        Whenever the Company shall have one or more Paying Agents, it will, prior to 10:00 a.m., New York City time, on each due date of the principal of and premium, if any, or interest (together with any Liquidated Damages in respect thereof) on any Securities, deposit with a Paying Agent a sum sufficient to pay such amount, such sum to be held in trust for the benefit of the Persons entitled to such principal, premium, if any, or interest, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its action or failure so to act.

        The Company will cause each Paying Agent other than the Trustee to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section 2.4, that such Paying Agent will, subject to Section 5.7:

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        (1)    hold all sums held by it for the payment of the principal of, premium, if any, or interest on Securities in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided;

        (2)    give the Trustee written notice of any default by the Company (or any other obligor upon the Securities) in the making of any payment of principal, premium, if any, or interest; and

        (3)    at any time during the continuance of any such default, upon the written request of the Trustee, forthwith pay to the Trustee all sums so held in trust by such Paying Agent.

        The Company may at any time require a Paying Agent to pay all money held by it to the Trustee and to account for any funds distributed by it. Upon doing so, the Paying Agent should have no further liability for the money.

        Any money deposited with the Trustee or any Paying Agent, or then held by the Company in trust for the payment of the principal of, and premium, if any, or interest (together with any Liquidated Damages in respect thereof) on any Security and remaining unclaimed for two years after such principal and premium, if any, or interest has become due and payable shall be paid, subject to applicable escheatment laws, to the Company on written request of the Company, or (if then held by the Company) shall be discharged from such trust; and the Holder of such Security shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in a newspaper selected by the Company and published in the English language, customarily published on each Business Day and of general circulation in the Borough of Manhattan, The City of New York, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Company.

SECTION 2.5.    SECURITYHOLDER LISTS.

        The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Securityholders. If the Trustee is not the Registrar, the Company shall furnish to the Trustee at least five Business Days prior to each semi-annual interest Payment Date and at such other times as the Trustee may request in writing a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Securityholders.

SECTION 2.6. TRANSFER AND EXCHANGE.

        (a)    The Securities shall be issued in registered form and shall be transferable only upon surrender for registration of transfer of any Security to the Registrar or any co-registrar at the office or agency of the Company designated as Registrar or co-registrar pursuant to Section 3.3, and satisfaction of the requirements for such transfer set forth in this Section 2.6, the

12

Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Securities of any authorized denominations and of a like aggregate principal amount and bearing such restrictive legends as may be required by this Indenture.

        Securities may be exchanged for other Securities of any authorized denominations and of a like aggregate principal amount, upon surrender of the Securities to be exchanged at any such office or agency maintained by the Company pursuant to Section 6.10. Whenever any Securities are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Securities which the Securityholder making the exchange is entitled to receive bearing numbers not contemporaneously outstanding.

        All Securities issued upon any registration of transfer or exchange of Securities shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Securities surrendered upon such registration of transfer or exchange.

        All Securities presented or surrendered for registration of transfer or for exchange, redemption or conversion shall (if so required by the Company or the Registrar) be duly endorsed, or be accompanied by a written instrument or instruments of transfer in form satisfactory to the Company, and the Securities shall be duly executed by the Securityholder thereof or his attorney duly authorized in writing.

        No service charge shall be made for any registration of transfer or exchange of Securities, but the Company may require payment of a sum sufficient to cover any tax, assessment or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Securities.

        Neither the Company nor the Trustee nor any Registrar or any Company registrar shall be required to exchange or register a transfer of (a) any Securities for a period of fifteen (15) days next preceding any selection of Securities to be redeemed or (b) any Securities or portions thereof selected for redemption pursuant to Section 3.4 or (c) any Securities or portion thereof surrendered for conversion pursuant to Article 4.

        So long as the Securities are eligible for book-entry settlement with the Depositary, or unless otherwise required by law, all Securities that upon initial issuance are beneficially owned by QIBs will be represented by a Security in global form registered in the name of the Depositary or the nominee of the Depositary (the "Global Note"). The transfer and exchange of beneficial interests in the Global Note shall be effected through the Depositary in accordance with this Indenture and the procedures of the Depositary therefor. The Trustee shall make appropriate endorsements to reflect increases or decreases in the principal amounts of the Global Note as set forth on the face of the Security to reflect any such transfers. Except as provided below, beneficial owners of the Global Note shall not be entitled to have certificates registered in their names, will not receive or be entitled to receive physical delivery of certificates in definitive form and will not be considered holders of such Securities in global form.

        (b)    Any Security in global form may be endorsed with or have incorporated in the text thereof such legends or recitals or changes not inconsistent with the provisions of this

13

Indenture as may be required by the Custodian, the Depositary or by the National Association of Securities Dealers, Inc. in order for the Securities to be tradable on The PORTAL Market or as may be required for the Securities to be tradable on any other market developed for trading of securities pursuant to Rule 144A or Regulation S or required to comply with any applicable law or any regulation thereunder or with the rules and regulations of any securities exchange or automated quotation system upon which the Securities may be listed or traded or to conform with any usage with respect thereto, or to indicate any special limitations or restrictions to which any particular Securities are subject.

        (c)    Every Security that bears or is required under this Section 2.6(c) to bear the legend set forth in this Section 2.6(c) (together with any Common Stock issued upon conversion of the Securities and required to bear the legend set forth in Section 2.6(d), collectively, the "Restricted Securities") shall be subject to the restrictions on transfer set forth in this Section 2.6(c) (including those set forth in the legend set forth below) unless such restrictions on transfer shall be waived by written consent of the Company, and the Holder of each such Transfer Restricted Security, by such Holder's acceptance thereof, agrees to be bound by all such restrictions on transfer. As used in Sections 2.6(c) and 2.6(d), the term "transfer" encompasses any sale, pledge, transfer or other disposition whatsoever of any Restricted Security.

        Until the expiration of the holding period applicable to sales thereof under Rule 144(k) under the Securities Act (or any successor provision), any certificate evidencing such Security (and all securities issued in exchange therefor or substitution thereof, other than Common Stock, if any, issued upon conversion thereof, which shall bear the legend set forth in Section 2.6(d), if applicable) shall bear a legend in substantially the following form, unless such Security has been sold pursuant to a registration statement that has been declared effective under the Securities Act (and which continues to be effective at the time of such transfer), or unless otherwise agreed by the Company in writing, with written notice thereof to the Trustee:

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, AGREES FOR THE BENEFIT OF GENCORP INC. (THE "COMPANY") THAT THIS SECURITY MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD UNDER RULE 144(k) (OR ANY SUCCESSOR THERETO) UNDER THE SECURITIES ACT WHICH IS APPLICABLE TO THIS SECURITY OR (Y) BY ANY HOLDER THAT WAS AN "AFFILIATE" (WITHIN THE MEANING OF RULE 144 UNDER THE SECURITIES ACT) OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE OF SUCH TRANSFER, IN EITHER CASE, OTHER THAN (1) TO THE COMPANY, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (3) IN AN OFFSHORE TRANSACTION (AS DEFINED IN REGULATION S UNDER THE SECURITIES

14

ACT) IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT, (4) TO AN INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1), (2), (3), OR (7) OF REGULATION D UNDER THE SECURITIES ACT ("INSTITUTIONAL ACCREDITED INVESTOR") THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION, AND THAT, PRIOR TO SUCH TRANSFER, DELIVERS TO THE COMPANY AND THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH LETTER MAY BE OBTAINED FROM THE TRUSTEE), (5) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT OR (6) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. PRIOR TO A TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER PURSUANT TO CLAUSE (6) ABOVE), THE HOLDER OF THIS SECURITY MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY AND THE TRUSTEE SUCH CERTIFICATES AND OTHER INFORMATION AND, IN THE CASE OF A TRANSFER PURSUANT TO CLAUSE (5) ABOVE, A LEGAL OPINION AS THEY MAY REASONABLY REQUIRE TO CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE FOREGOING RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER OR (2) AN INSTITUTIONAL ACCREDITED INVESTOR THAT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION OR (3) NOT A U.S. PERSON AND IS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING THE REQUIREMENTS OF PARAGRAPH (k)(2) OF RULE 902 UNDER) REGULATION S UNDER THE SECURITIES ACT. IN ANY CASE, THE HOLDER HEREOF WILL NOT, DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO THIS SECURITY OR ANY COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY EXCEPT AS PERMITTED BY THE SECURITIES ACT.

        Any Security (or security issued in exchange or substitution therefor) as to which such restrictions on transfer shall have expired in accordance with their terms or as to which the conditions for removal of the foregoing legend set forth therein have been satisfied may, upon surrender of such Security for exchange to the Registrar in accordance with the provisions of this Section 2.6, be exchanged for a new Security or Securities, of like tenor and aggregate principal amount, which shall not bear the restrictive legend required by this Section 2.6(c).

        Notwithstanding any other provisions of this Indenture (other than the provisions set forth in Section 2.6(b) and in this Section 2.6(c)), the Global Note may not be transferred as a whole or in part except by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary.

15

        The Depositary shall be a clearing agency registered under the Exchange Act. The Company initially appoints The Depository Trust Company to act as Depositary with respect to the Global Note. Initially, the Global Note shall be issued to the Depositary, registered in the name of Cede & Co., as the nominee of the Depositary, and deposited with the Custodian for Cede & Co. Securityholders may hold their interests in the Global Note directly through DTC if they are DTC participants, or indirectly through DTC participants.

        If at any time the Depositary for the Global Note notifies the Company that it is unwilling or unable to continue as Depositary for such Global Note, the Company may appoint a successor Depositary with respect to such Global Note. If a successor Depositary is not appointed by the Company within ninety (90) days after the Company receives such notice, the Company will execute, and the Trustee, upon receipt of an Officers' Certificate for the authentication and delivery of Securities, will authenticate and deliver, Securities in certificated form, in aggregate principal amount equal to the principal amount of the Global Note, in exchange for such Global Note.

        If a Security in certificated form is issued in exchange for any portion of the Global Note after the close of business at the office or agency where such exchange occurs on any record date and before the opening of business at such office or agency on the next succeeding interest Payment Date, interest will not be payable on such interest Payment Date in respect of such Security, but will be payable on such interest Payment Date, subject to the provisions of paragraphs 1 and 2 of the Security, only to the person to whom interest in respect of such portion of the Global Note is payable in accordance with the provisions of this Indenture and the Securities.

        Securities in certificated form issued in exchange for all or a part of the Global Note pursuant to this Section 2.6 shall be registered in such names and in such authorized denominations as the Depositary, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Trustee. Upon execution and authentication, the Trustee shall deliver such Securities in certificated form to the persons in whose names such Securities in certificated form are so registered.

        At such time as all interests in the Global Note have been redeemed, converted, canceled, exchanged for Securities in certificated form, or transferred to a transferee who receives Securities in certificated form thereof, such Global Note shall, upon receipt thereof, be canceled by the Trustee in accordance with standing procedures and instructions existing between the Depositary and the Custodian. At any time prior to such cancellation, if any interest in the Global Note is redeemed, converted, repurchased or canceled, the principal amount of the Global Note shall, in accordance with the standing procedures and instructions existing between the Depositary and the Custodian, be appropriately reduced and an endorsement shall be made on such Global Note, by the Trustee or the Custodian, at the direction of the Trustee, to reflect such reduction.

        (d) Until the expiration of the holding period applicable to sales thereof under Rule 144(k) under the Securities Act (or any successor provision), any stock certificate representing Common Stock issued upon conversion of such Security shall bear a legend in substantially the following form, unless such Common Stock has been sold pursuant to a registration statement

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that has been declared effective under the Securities Act (and which continues to be effective at the time of such transfer) or such Common Stock has been issued upon conversion of Securities that have been transferred pursuant to a registration statement that has been declared effective under the Securities Act, or unless otherwise agreed by the Company in writing with written notice thereof to the transfer agent:

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, AGREES FOR THE BENEFIT OF GENCORP INC. (THE "COMPANY") THAT THIS SECURITY MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD UNDER RULE 144(k) (OR ANY SUCCESSOR THERETO) UNDER THE SECURITIES ACT WHICH IS APPLICABLE TO THIS SECURITY OR (Y) BY ANY HOLDER THAT WAS AN "AFFILIATE" (WITHIN THE MEANING OF RULE 144 UNDER THE SECURITIES ACT) OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE OF SUCH TRANSFER, IN EITHER CASE, OTHER THAN (1) TO THE COMPANY, (2) IN AN OFFSHORE TRANSACTION (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT) IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER APPLICABLE TO THIS SECURITY, THE FORM OF WHICH MAY BE OBTAINED FROM THE COMPANY OR THE TRANSFER AGENT), (3) TO AN INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT ("INSTITUTIONAL ACCREDITED INVESTOR") AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER APPLICABLE TO THIS SECURITY, THE FORM OF WHICH MAY BE OBTAINED FROM THE COMPANY OR THE TRANSFER AGENT, THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION, AND THAT, PRIOR TO SUCH TRANSFER, DELIVERS TO THE COMPANY AND THE TRANSFER AGENT A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH MAY BE OBTAINED FROM THE COMPANY OR THE TRANSFER AGENT), (4) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER APPLICABLE TO THIS SECURITY, THE FORM OF WHICH MAY BE OBTAINED FROM THE COMPANY OR THE TRANSFER AGENT), OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. PRIOR TO A TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER PURSUANT TO CLAUSE (5) ABOVE), THE HOLDER OF THIS SECURITY MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY AND THE TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AND, IN THE CASE OF A

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TRANSFER PURSUANT TO CLAUSE (4) ABOVE, A LEGAL OPINION AS THEY MAY REASONABLY REQUIRE TO CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE FOREGOING RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) AN INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT AND THAT IT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION OR (2) NOT A U.S. PERSON AND IS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING THE REQUIREMENTS OF PARAGRAPH (k)(2) OF RULE 902 UNDER) REGULATION S UNDER THE SECURITIES ACT. IN ANY CASE THE HOLDER HEREOF WILL NOT, DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO THIS SECURITY EXCEPT AS PERMITTED BY THE SECURITIES ACT.

        Any such Common Stock as to which such restrictions on transfer shall have expired in accordance with their terms or as to which the conditions for removal of the foregoing legend set forth therein have been satisfied may, upon surrender of the certificates representing such shares of Common Stock for exchange in accordance with the procedures of the transfer agent for the Common Stock, be exchanged for a new certificate or certificates for a like number of shares of Common Stock, which shall not bear the restrictive legend required by this Section 2.6(d).

        (e) Any Security or Common Stock issued upon the conversion or exchange of a Security that, prior to the expiration of the holding period applicable to sales thereof under Rule 144(k) under the Securities Act (or any successor provision), is purchased or owned by the Company or any Affiliate thereof may not be resold by the Company or such Affiliate unless registered under the Securities Act or resold pursuant to an exemption from the registration requirements of the Securities Act in a transaction which results in such Securities or Common Stock, as the case may be, no longer being" restricted securities" (as defined under Rule 144).

        (f) Each Holder of a Security agrees to indemnify the Company and the Trustee against any liability that may result from the transfer, exchange or assignment of such Holder's Security in violation of any provision of this Indenture and/or applicable United States Federal or state securities law.

        The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Security (including any transfers between or among depositary participants or beneficial owners of interests in the Global Note) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.

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SECTION 2.7. REPLACEMENT SECURITIES.

        If any mutilated Security is surrendered to the Company or the Trustee, or the Company and the Trustee receive evidence to their satisfaction of the destruction, loss or theft of any Security, and there is delivered to the Company and the Trustee such Security or indemnity as may be required by them to save each of them harmless, then, in the absence of notice to the Company or the Trustee that such Security has been acquired by a bona fide purchaser, the Company shall execute, and upon its written request the Trustee shall authenticate and deliver, in exchange for any such mutilated Security or in lieu of any such destroyed, lost or stolen Security, a new Security of like tenor and principal amount, bearing a number not contemporaneously outstanding.

        In case any such mutilated, destroyed, lost or stolen Security has become or is about to become due and payable, or is about to be redeemed by the Company pursuant to Article 3, the Company in its discretion may, instead of issuing a new Security, pay or redeem such Security, as the case may be.

        Upon the issuance of any new Securities under this Section 2.7, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) in connection therewith.

        Every new Security issued pursuant to this Section 2.7 in lieu of any destroyed, lost or stolen Security shall constitute an original additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all benefits of this Indenture equally and proportionately with any and all other Securities duly issued hereunder.

        The provisions of this Section 2.7 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities.

SECTION 2.8. OUTSTANDING SECURITIES.

        Securities outstanding at any time are all Securities authenticated by the Trustee, except for those canceled by it, those delivered to it for cancellation and those described in this Section 2.8 as not outstanding.

        If a Security is replaced pursuant to Section 2.7, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Security is held by a bona fide purchaser.

        If the Paying Agent (other than the Company or an Affiliate of the Company) holds on a redemption date, repurchase date or maturity date money sufficient to pay the principal of, premium, if any, and accrued interest on Securities payable on that date, then on and after that date such Securities cease to be outstanding and interest on them ceases to accrue; provided that if such Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture.

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        Subject to the restrictions contained in Section 2.9, a Security does not cease to be outstanding because the Company or an Affiliate of the Company holds the Security.

SECTION 2.9. TREASURY SECURITIES.

        In determining whether the Holders of the required principal amount of Securities have concurred in any notice, direction, waiver or consent, Securities owned by the Company or any other obligor on the Securities or by any Affiliate of the Company or of such other obligor shall be disregarded, except that for purposes of determining whether the Trustee shall be protected in relying on any such notice, direction, waiver or consent, only Securities which a Trust Officer of the Trustee actually knows are so owned shall be so disregarded. Securities so owned which have been pledged in good faith shall not be disregarded if the pledgee establishes to the satisfaction of the Trustee the pledgee's right so to act with respect to the Securities and that the pledgee is not the Company or any other obligor upon the Securities or any Affiliate of the Company or of such other obligor.

SECTION 2.10. TEMPORARY SECURITIES.

        Until definitive Securities are ready for delivery, the Company may prepare and execute, and, upon the order of the Company, the Trustee shall authenticate and deliver temporary Securities. Temporary Securities shall be substantially in the form of definitive Securities but may have variations that the Company with the consent of the Trustee considers appropriate for temporary Securities. Every such temporary Security shall be executed by the Company and authenticated by the Trustee upon the same conditions and in substantially the same manner, and with the same effect, as the definitive Securities. Without unreasonable delay the Company will execute and deliver to the Trustee definitive Securities and thereupon any or all temporary Securities may be surrendered in exchange therefor, at each office or agency maintained by the Company pursuant to Section 6.10 and the Trustee shall authenticate and deliver in exchange for such temporary Securities an equal aggregate principal amount of definitive Securities. Such exchange shall be made by the Company at its own expense and without any charge therefor. Until so exchanged, the temporary Securities shall in all respects be entitled to the same benefits under this Indenture as definitive Securities authenticated and delivered hereunder.

SECTION 2.11. CANCELLATION.

        The Company at any time may deliver Securities to the Trustee for cancellation. The Registrar, the Paying Agent and the Conversion Agent shall forward to the Trustee any Securities surrendered to them for transfer, exchange, payment or conversion. The Trustee and no one else shall cancel all Securities surrendered for transfer, exchange, payment (including redemption or repurchase), conversion or cancellation and shall dispose of cancelled Securities in accordance with its procedures for the disposition of cancelled Securities in effect as of the date of such disposition and thereupon deliver a certificate of cancellation to the Company. The Company may not issue new Securities to replace Securities it has paid or delivered to the Trustee for cancellation or which have been converted.

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SECTION 2.12. CUSIP NUMBERS.

        The Company in issuing the Securities may use "CUSIP" numbers (if then generally in use), and if so, the Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to Holders; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company will promptly notify the Trustee of any change in the "CUSIP" numbers.

ARTICLE 3.

REDEMPTION AND REPURCHASE

SECTION 3.1. OPTIONAL REDEMPTION BY THE COMPANY.

        The Company may, at its option, redeem all, or from time to time, any part of the Securities on any date on or after April 22, 2005 and prior to maturity (an "Optional Redemption") if the trading price of the Company's Common Stock for 20 Trading Days in a period of 30 consecutive Trading Days ending on the Trading Day prior to the date of mailing of the provisional notice of redemption (the "Notice Date") exceeds 125% of the Conversion Price (as defined in Section 4.6) of the Securities, upon notice as set forth in Section 3.4, and at the redemption prices set forth in paragraph 5 of the form of Security attached hereto as Exhibit A, together with accrued interest to the date of redemption.

SECTION 3.2. SELECTION TO REDEEM; NOTICE TO TRUSTEE.

        If the Company elects to redeem Securities pursuant to paragraph 5 of the Securities, it shall notify the Trustee at least 30 days but not more than 60 days prior to the redemption date as fixed by the Company (unless a shorter notice shall be satisfactory to the Trustee) of the redemption date and the principal amount of Securities to be redeemed. If fewer than all of the Securities are to be redeemed, the record date relating to such redemption shall be selected by the Company and given to the Trustee, which record date shall not be less than 10 days after the date of notice to the Trustee.

SECTION 3.3. SELECTION OF SECURITIES TO BE REDEEMED.

        If less than all of the Securities are to be redeemed, the Trustee shall, not more than 60 days prior to the redemption date, select the Securities to be redeemed by lot, pro rata or by another method the Trustee considers fair and appropriate; provided that such method is not prohibited by any stock exchange or market on which the Securities are then listed. The Trustee shall make the selection from the Securities outstanding and not previously called for redemption. Securities in denominations of $1,000 may only be redeemed in whole. The Trustee may select for redemption portions (equal to $1,000 or any multiple thereof) of the principal of Securities that have denominations larger than $1,000. Provisions of this Indenture that apply to Securities called for redemption also apply to portions of Securities called for redemption. If a portion of a Holder's Securities is selected for redemption and that Holder

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converts a portion of its Securities, the converted portion will be deemed to be the portion first selected for redemption.

SECTION 3.4. NOTICE OF REDEMPTION.

        Notice of redemption shall be given at least 30 days and no more than 60 days' prior to the redemption date in the case of an Optional Redemption. In each case, the Company shall mail or cause to be mailed a notice of redemption by first-class mail to each Holder of Securities to be redeemed at such Holder's address as it appears on the Registrar's books.

        The notice shall identify the Securities to be redeemed and shall state:

(1)

the redemption date;



(2)

the redemption price;



(3)

the then-current Conversion Price;



(4)

the name and address of the Paying Agent and the Conversion Agent;



(5)

that Securities called for redemption must be presented and surrendered to the Paying Agent to collect the redemption price;



(6)

that the Securities called for redemption may be converted at any time before the close of business on the Business Day immediately preceding the redemption date;



(7)

that Holders who wish to convert Securities must satisfy the requirements in paragraph 8 of the Securities;



(8)

that, unless the Company defaults in making the redemption payment, interest on Securities called for redemption ceases to accrue on and after the redemption date and the only remaining right of the Holder is to receive payment of the redemption price upon presentation and surrender to the Paying Agent of the Securities;



(9)

if any Security is being redeemed in part, the portion of the principal amount of such Security to be redeemed and that, after the redemption date, upon presentation and surrender of such Security, a new Security or Securities in principal amount equal to the unredeemed portion thereof will be issued; and



(10)

subject to Section 2.12, the CUSIP number of the Securities called for redemption.

At the Company's written request delivered at least 5 days prior to the date of the mailing of the notice of redemption, the Trustee shall give the notice of redemption in the Company's name and at the Company's expense.

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SECTION 3.5. DEPOSIT OF REDEMPTION PRICE.

        On or prior to 10:00 a.m. (New York City time) on the Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company or a Subsidiary or an Affiliate of either of them is acting as its own Paying Agent, segregate and hold in trust) an amount of money sufficient to pay the Redemption Price of, and (except if the Redemption Date shall be an interest Payment Date) accrued interest on, all the Securities which are to be redeemed on that date other than any Securities or portions of Securities called for redemption which on or prior thereto which have been delivered by the Company to the Trustee for cancellation or which have been converted.

        If any Security called for redemption is converted, any money deposited with the Trustee or with any Paying Agent or segregated and held in trust for the redemption of such Security shall (subject to any right of the Holder of such Security or any predecessor security to receive interest) be paid to the Company as soon as practicable or, if then held by the Company, shall be released from such trust.

SECTION 3.6. SECURITIES PAYABLE ON REDEMPTION DATE.

        Once a notice of redemption has been given as aforesaid, the Securities called for redemption shall, on the Redemption Date, become due and payable at the Redemption Price therein specified, except for Securities which are converted in accordance with this Indenture, and from and after such date (unless the Company shall default in the payment of the Redemption Price and accrued interest, if any) such Securities shall cease to bear or accrue any interest. Upon surrender of any such Security for redemption in accordance with said notice, such Security shall be paid by the Company at the Redemption Price, together with accrued interest, if any, to (but not including) the Redemption Date; provided, however, that installments of interest whose stated maturity is on or prior to the Redemption Date shall be payable to the Holders of such Securities registered as such at the close of business on the relevant Record Dates according to their terms.

SECTION 3.7. SECURITIES REDEEMED IN PART.

        Any Security which is to be redeemed only in part shall be surrendered at an office or agency of the Company designated for that purpose (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or his attorney-in-fact duly authorized in writing), and the Company shall execute, and the Trustee shall authenticate and deliver to the Holder of such Security without service charge, a new Security or Securities, of any authorized denomination as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal amount of the Security surrendered.

SECTION 3.8. CONVERSION ARRANGEMENT ON CALL FOR REDEMPTION.

        In connection with any redemption of Securities, the Company may arrange for the purchase and conversion of any Securities by an agreement with one or more investment bankers or other purchasers (the "Purchase Party") to purchase such Securities by paying to the Trustee

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in trust for the Holders, on or before the Redemption Date, an amount not less than the applicable Redemption Price of such Securities, together with interest accrued to the Redemption Date. Notwithstanding anything to the contrary contained in this Article 3, the obligation of the Company to pay the Redemption Price of such Securities, together with interest accrued to, but excluding, the Redemption Date shall be deemed to be satisfied and discharged to the extent such amount is so paid by such Purchase Party. If such an agreement is entered into, a copy of which shall be filed with the Trustee prior to or on the Redemption Date, any Securities not duly surrendered for conversion by the Holders thereof, may, at the option of the Company, be deemed, to the fullest extent permitted by law, acquired by such purchasers from such Holders and (notwithstanding anything to the contrary contained in Article 4) surrendered by such purchasers for conversion, all as of immediately prior to the close of business on the Business Day prior to the Redemption Date (and the right to convert any such Securities shall be deemed to have been extended through such time), subject to payment of the above amount as aforesaid. At the direction of the Company, the Trustee shall hold and dispose of any such amount paid to it in the same manner as it would monies deposited with it by the Company for the redemption of Securities. Without the Trustee's prior written consent, no arrangement between the Company and such purchasers for the purchase and conversion of any Securities shall increase or otherwise affect any of the powers, duties, responsibilities or obligations of the Trustee as set forth in this Indenture, and the Company agrees to indemnify the Trustee from, and hold it harmless against, any loss, liability or expense arising out of or in connection with any such arrangement for the purchase and conversion of any Securities between the Company and such purchasers, including the costs and expenses incurred by the Trustee in the defense of any claim or liability arising out of or in connection with the exercise or performance of any of its powers, duties, responsibilities or obligations under this Indenture. Nothing in the preceding sentence shall be deemed to limit the rights and protections afforded to the Trustee in Article 9, including, but not limited to, the right to the indemnification pursuant to Section 9.7.

SECTION 3.9. REPURCHASE OF SECURITIES AT OPTION OF THE HOLDER UPON CHANGE OF CONTROL.

        If at any time that Securities remain outstanding there shall have occurred a Change of Control (as hereinafter defined), Securities shall be repurchased by the Company or by a Purchase Party, if applicable, at the option of the Holder thereof, at a purchase price in cash (the "Repurchase Price") equal to 100% of the principal amount thereof plus accrued interest, if any, up to and including the Repurchase Date (as hereinafter defined), on the date (the "Repurchase Date") fixed by the Company that is not less than 45 days nor more than 60 days after the date of the Company Notice (as hereinafter defined), subject to satisfaction by or on behalf of the Holder of the requirements set forth in Section 3.10(b).

        Whenever in this Indenture there is a reference to the principal of any Security as of any time, such reference shall be deemed to include reference to the Repurchase Price payable in respect of such Security to the extent that such Repurchase Price is, was or would be so payable at such time, and express mention of the Repurchase Price in any provision of this Indenture shall not be construed as excluding the Repurchase Price in those provisions of this Indenture when such express mention is not made.

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        Any rights of Holders, contractual or otherwise, arising under or pursuant to any offer to repurchase Securities made by the Company under this Section 3.9 shall be subordinated in right of payment to all Senior Indebtedness to the same extent as the Securities are subordinated to Senior Indebtedness under the provisions of Article 5 and such offer to repurchase shall provide that, if at the time the Securities are required to be repurchased pursuant to such offer, payment of the Securities is not permitted pursuant to the provisions of Article 5, the Company shall use its best efforts to obtain all necessary waivers from, or to repay in full, the holders of Senior Indebtedness in order to permit such repurchase. Notwithstanding the foregoing, any failure by the Company to comply with this Section 3.9 to offer to repurchase, or to repurchase, the Securities shall be a default in the performance by the Company hereunder.

        A "Change of Control" shall be deemed to have occurred at such time after the original issuance of the Securities as any of the following occur:

        (1)  any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all or substantially all of the assets of the Company and its Subsidiaries, taken as a whole, to any Person or group of related Persons, as defined in Section 13(d) of the Exchange Act (a "Group");

        (2)  the approval by the holders of capital stock of the Company of any plan or proposal for the liquidation or dissolution of the Company (whether or not otherwise in compliance with the provisions of the Indenture);

        (3)  any Person or Group shall become the owner, directly or indirectly, beneficially or of record, of shares representing more than 45% of the aggregate ordinary voting power represented by the Company's issued and outstanding Voting Stock of, or any successor to, all or substantially all of the Company's assets; or

        (4)  the first day on which a majority of the members of the Company's Board of Directors are not Continuing Directors.

SECTION 3.10. NOTICE; METHOD OF EXERCISING REPURCHASE RIGHT.

        (a)  Within 30 days after the occurrence of a Change of Control, the Company shall mail a written notice (the "Company Notice") by first-class mail to the Trustee and to each Holder (and to beneficial owners as required by applicable law). The notice shall include the form of a Repurchase Notice (as defined below) to be completed by the Holder and shall state:

        (1)  the date of such Change of Control and, briefly, the events causing such Change of Control;

        (2)  the date by which the Repurchase Notice pursuant to this Section 3.10 must be given;

        (3)  the Repurchase Date;

        (4)  the Repurchase Price; and

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        (5)  the procedures that the Holder must follow to exercise rights under Section 3.9.

        (b)  A Holder may exercise its rights specified in Section 3.9 upon delivery of a written notice of the exercise of such rights (a "Repurchase Notice") to the Paying Agent at any time prior to the close of business on the third Business Day prior to the Repurchase Date, stating:

        (1)  the certificate number of each Security that the Holder will deliver to be repurchased;

        (2)  the portion of the principal amount of each Security that the Holder will deliver to be repurchased which portion must be $1,000 or an integral multiple thereof; and that such Security shall be repurchased pursuant to the terms and conditions specified in this Indenture.

        The delivery of such Security to the Paying Agent together with the Repurchase Notice at any time prior to the third Business Day prior to the Repurchase Date (together with all necessary endorsements) at the office of the Paying Agent shall be a condition to the receipt by the Holder of the Repurchase Price therefor; provided, however, that such Repurchase Price shall be so paid pursuant to Section 3.9 only if the Security so delivered to the Paying Agent shall conform in all respects to the description thereof set forth in the related Repurchase Notice as determined by the Company.

        The Company or the Purchase Party shall repurchase from the Holder thereof, pursuant to Section 3.9, a portion of a Security if the principal amount of such portion is $1,000 or an integral multiple of $1,000. Provisions of this Indenture that apply to the repurchase of all of a Security pursuant to Sections 3.9 through 3.15 also apply to the repurchase of such portion of such Security.

        Notwithstanding anything herein to the contrary, any Holder delivering to the Paying Agent the Repurchase Notice contemplated by this Section 3.10(b) shall have the right to withdraw such Repurchase Notice in whole or in a portion thereof that is $1,000 or an integral multiple thereof at any time prior to the close of business on the Business Day prior to the Repurchase Date by delivery of a written notice of withdrawal to the Paying Agent in accordance with Section 3.11.

        The Paying Agent shall promptly notify the Company and any Purchase Party of the receipt by it of any Repurchase Notice or written withdrawal thereof.

SECTION 3.11. EFFECT OF REPURCHASE NOTICE.

        Upon receipt by the Paying Agent of the Repurchase Notice specified in Section 3.10(b), the Holder of the Security in respect of which such Repurchase Notice was given shall (unless such Repurchase Notice is withdrawn as specified below) thereafter be entitled to receive solely the Repurchase Price with respect to such Security. Such Repurchase Price shall be paid to such Holder promptly following the later of (i) the Repurchase Date with respect to such Security (provided the conditions in Section 3.10(b) have been satisfied) and (ii) the time of delivery of such Security to the Paying Agent by the Holder

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thereof in the manner required by Section 3.10(b). Securities in respect of which a Repurchase Notice has been given by the Holder thereof may not be converted into shares of Common Stock on or after the date of the delivery of such Repurchase Notice unless such Repurchase Notice has first been validly withdrawn.

        A Repurchase Notice may be withdrawn by means of a written notice of withdrawal delivered by the Holder, with such Holder's signature guaranteed in a manner satisfactory to the Paying Agent, to the office of the Paying Agent at any time prior to the close of business on the Business Day prior to the Repurchase Date to which it relates, specifying:

        (1)  the certificate number of each Security in respect of which such notice of withdrawal is being submitted;

        (2)  the principal amount of the Security or portion thereof with respect to which such notice of withdrawal is being submitted; and

        (3)  the principal amount, if any, of such Security that remains subject to the original Repurchase Notice and that has been or will be delivered for repurchase by the Company.

SECTION 3.12. DEPOSIT OF REPURCHASE PRICE.

        On or before the Repurchase Date, the Company shall deposit with the Trustee or with the Paying Agent (or, if the Company or a Subsidiary or an Affiliate of either of them is acting as the Paying Agent, shall segregate and hold in trust as provided in Section 2.4) an amount of money sufficient to pay the aggregate Repurchase Price of all the Securities or portions thereof that are to be repurchased as of such Repurchase Date. The manner in which the deposit required by this Section 3.12 is made by the Company shall be at the option of the Company; provided that such deposit shall be made in a manner such that the Trustee or the Paying Agent shall have immediately available funds on the Repurchase Date; provided further, that if such payment is made on the Repurchase Date it must be received by the Trustee or Paying Agent, as the case may be, by 10:00 a.m., New York City time, on such date.

        If the Paying Agent holds, in accordance with the terms hereof, money sufficient to pay the Repurchase Price of any Security tendered for repurchase on the Business Day prior to the Repurchase Date, then, on and after the Repurchase Date, such Security will cease to be outstanding and interest on such Security will cease to accrue and will be deemed paid, whether or not such Security is delivered to the Paying Agent, and all other rights of the Holder in respect thereof shall terminate (other than the right to receive the Repurchase Price upon delivery of such Security).

SECTION 3.13. SECURITIES REPURCHASED IN PART.

        Any Security that is to be repurchased only in part shall be surrendered at the office of the Paying Agent (with due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or such Holder's attorney duly authorized in writing), and the Company shall execute and the Trustee shall authenticate and deliver to the Holder of such Security, without service charge, a new Security or Securities, or such authorized denomination or denominations as may be requested by such Holder, in aggregate principal amount equal to, and in exchange for, the portion of the principal amount of the Security so surrendered that is not repurchased.

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SECTION 3.14.    COMPLIANCE WITH SECURITIES LAWS UPON REPURCHASE OF SECURITIES.

        In connection with any offer to repurchase or repurchase of Securities under Section 3.9 hereof (provided that such offer or repurchase constitutes an "issuer tender offer" for purposes of Rule 13e-4 (which term, as used herein, includes any successor provision thereto) at the time of such offer or repurchase), the Company shall (i) comply with Rule 13e-4 and Rule 14e-1 under the Exchange Act, if applicable, (ii) file the related Schedule TO (or any successor schedule, form or report) under the Exchange Act, and (iii) otherwise comply with all federal and state securities laws so as to permit the rights of the Holders and obligations of the Company under Sections 3.9 through 3.14 to be exercised at the time and in the manner specified therein.

SECTION 3.15.    REPAYMENT TO THE COMPANY.

        Subject to the provisions of Section 5.7, to the extent that the aggregate amount of cash deposited by the Company pursuant to Section 3.12 exceeds the aggregate Repurchase Price of the Securities or portions thereof to be repurchased, then, promptly after the Business Day following the Repurchase Date, the Trustee or the Paying Agent, as the case may be, shall return any such excess to the Company.

ARTICLE 4.

CONVERSION

SECTION 4.1.    CONVERSION PRIVILEGE.

        At any time after 90 days following the last date of original issuance of the Securities and prior to the close of business on the Business Day immediately preceding April 15, 2007, a Holder of a Security may convert such Security into Common Stock (the shares of Common Stock issuable upon such conversion, the "Conversion Shares"), at the Conversion Price then in effect, together with those rights, warrants or options specified in the first sentence of Section 4.6(f) hereof, to the extent applicable; provided that, if such Security is called for redemption pursuant to Article 3, such conversion right shall terminate at the close of business on the Business Day before the redemption date for such Security (unless the Company shall default in making the redemption payment then due, in which case the conversion right shall terminate on the date such default is cured and such Security is redeemed). The number of shares of Common Stock issuable upon conversion of a Security shall be determined by dividing the principal amount of the Security or portion thereof surrendered for conversion by the Conversion Price in effect on the conversion date. The initial Conversion Price is set forth in paragraph 8 of the Securities and is subject to adjustment as provided in this Article 4.

        A Holder may convert a portion of a Security equal to $1,000 or any integral multiple thereof. Provisions of this Indenture that apply to conversion of all of a Security also apply to conversion of a portion of a Security.

        A Security in respect of which a Holder has delivered a Repurchase Notice pursuant to Section 3.10(b) exercising the option of such Holder to require the Company to repurchase such Security may be converted only if such Repurchase Notice is withdrawn by a written notice of

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withdrawal delivered to the Paying Agent prior to the close of business on the Repurchase Date in accordance with Section 3.11.

        A Holder of Securities is not entitled to any rights of a holder of Common Stock until such Holder has converted his Securities into Common Stock and, upon such conversion, only to the extent such Securities are deemed to have been converted into Common Stock pursuant to this Article 4.

SECTION 4.2.    CONVERSION PROCEDURE.

        To convert a Security, a Holder must (i) complete and manually sign the conversion notice on the back of the Security and deliver such notice to the Conversion Agent, (ii) surrender the Security to the Conversion Agent, (iii) furnish appropriate endorsements and transfer documents to the Registrar or the Conversion Agent, (iv) pay any transfer or other tax, if required by Section 4.4 and (v) if the Security is held in book-entry form, complete and deliver to the Depositary appropriate instructions pursuant to the Depositary's book-entry conversion programs. The date on which the Holder satisfies all of the foregoing requirements is the conversion date. As soon as practicable after the conversion date, the Company shall deliver to the Holder through the Conversion Agent a certificate for the number of whole shares of Common Stock issuable upon the conversion and cash in lieu of any fractional shares pursuant to Section 4.5.

        The person in whose name the certificate is registered shall be deemed to be a stockholder of record on the conversion date; provided, however, that no surrender of a Security on any date when the stock transfer books of the Company shall be closed shall be effective to constitute the person or persons entitled to receive the shares of Common Stock upon such conversion as the record holder or holders of such shares of Common Stock on such date, but such surrender shall be effective to constitute the person or persons entitled to receive such shares of Common Stock as the record holder or holders thereof for all purposes at the close of business on the next succeeding day on which such stock transfer books are open; provided, further, that such conversion shall be at the Conversion Price in effect on the date that such Security shall have been surrendered for conversion, as if the stock transfer books of the Company had not been closed. Upon conversion of a Security, such person shall no longer be a Holder of such Security.

        No payment or adjustment will be made for accrued interest on converted Security or for dividends or distributions on shares of Common Stock issued upon conversion of a Security, but if any Holder surrenders a Security for conversion between the record date for the payment of an installment of interest and the next interest Payment Date, then, notwithstanding such conversion, the interest payable on such interest Payment Date shall be paid to the Holder of such Security on such record date. In such event, such Security, when surrendered for conversion, must be accompanied by delivery of a check payable to the Conversion Agent in an amount equal to the interest payable on such interest Payment Date on the portion so converted. If such payment does not accompany such Security, the Security shall not be converted; provided, however, that no such check shall be required if such Security has been called for redemption on a redemption date within the period between and including such record date and

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such interest Payment Date. If the Company defaults in the payment of interest payable on the interest Payment Date, the Conversion Agent shall repay such funds to the Holder.

        Upon surrender of a Security that is converted in part, the Company shall execute, and the Trustee shall authenticate and deliver to the Holder, a new Security equal in principal amount to the unconverted portion of the Security surrendered.

SECTION 4.3.    ADJUSTMENTS BELOW PAR VALUE.

        Before taking any action which would cause an adjustment decreasing the Conversion Price so that the shares of Common Stock issuable upon conversion of the Securities would be issued for less than the par value of such Common Stock, the Company will take all corporate action which may be necessary in order that the Company may validly and legally issue fully paid and nonassessable shares of such Common Stock at such adjusted Conversion Price.

SECTION 4.4.    TAXES ON CONVERSION.

        If a Holder converts a Security, the Company shall pay any documentary, stamp or similar issue or transfer tax due on the issue of shares of Common Stock upon such conversion. However, the Holder shall pay any such tax which is due because the Holder requests the shares to be issued in a name other than the Holder's name. The Conversion Agent may refuse to deliver the certificates representing the Common Stock being issued in a name other than the Holder's name until the Conversion Agent receives a sum sufficient to pay any tax which will be due because the shares are to be issued in a name other than the Holder's name. Nothing herein shall preclude any tax withholding required by law or regulations.

SECTION 4.5.    COMPANY TO PROVIDE STOCK.

        The Company shall, prior to issuance of any Securities hereunder, and from time to time as may be necessary, reserve, out of its authorized but unissued Common Stock a sufficient number of shares of Common Stock to permit the conversion of all outstanding Securities for shares of Common Stock. The shares of Common Stock or other securities issued upon conversion of the Securities shall bear any legend required in accordance with Section 2.6(d).

        No fractional shares of Common Stock or scrip representing fractional shares shall be issued upon conversion of Securities. If more than one Security shall be surrendered for conversion at one time by the same holder, the number of full shares which shall be issuable upon conversion shall be computed on the basis of the aggregate principal amount of the Securities (or specified portions thereof to the extent permitted hereby) so surrendered. If any fractional share of Common Stock would be issuable upon the conversion of any Security or Securities, the Company shall make an adjustment thereof in cash at the current market value thereof. For these purposes, the current market value of a share of Common Stock shall be the Closing Price on the first day (which is not a Legal Holiday) immediately preceding the day on which the Securities (or specified portions thereof) are deemed to have been converted.

        The Company covenants that all shares of Common Stock delivered upon conversion of the Securities shall be newly issued shares or treasury shares, shall be duly authorized, validly

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issued, fully paid and non-assessable and shall be free from preemptive rights and free of any lien or adverse claim.

        The Company will endeavor promptly to comply with all federal and state securities laws regulating the offer and delivery of shares of Common Stock upon conversion of Securities, if any, and will list or cause to have quoted such shares of Common Stock on each national securities exchange or in the over-the-counter market or such other market on which the Common Stock is then listed or quoted.

SECTION 4.6.    ADJUSTMENT OF CONVERSION PRICE.

        The conversion price (the "Conversion Price") shall be that price set forth in paragraph 8 of the form of Security attached hereto as Exhibit A and shall be adjusted from time to time by the Company as follows:

        (a)  In case the Company shall (i) pay a dividend or other distribution in shares of Common Stock to holders of Common Stock, (ii) subdivide its outstanding Common Stock into a greater number of shares, (iii) combine its outstanding Common Stock into a smaller number of shares or (iv) reclassify its outstanding Common Stock, the Conversion Price in effect immediately prior thereto shall be adjusted so that the Holder of any Security thereafter surrendered for conversion shall be entitled to receive the number of shares of Common Stock which it would have owned or have been entitled to receive had such Security been converted immediately prior to the happening of such event. An adjustment made pursuant to this subsection (a) shall become effective immediately after the record date in the case of a dividend or distribution and shall become effective immediately after the effective date in the case of subdivision, combination or reclassification.

        (b)  In case the Company shall issue to all or substantially all holders of its Common Stock, rights, warrants or options entitling such holders (for a period commencing no earlier than the record date described below and expiring not more than 45 days after such record date) to subscribe for or purchase shares of Common Stock (or securities convertible into Common Stock) at a price per share less than the current market price per share of Common Stock (as determined in accordance with subsection (f) below) at the record date for the determination of stockholders entitled to receive such rights, warrants or options, the Conversion Price in effect immediately prior thereto shall be adjusted so that the Conversion Price shall equal the price determined by multiplying the Conversion Price in effect immediately prior to such record date by a fraction, the numerator of which shall be the number of shares of Common Stock outstanding on such record date, plus the number of shares which the aggregate subscription or purchase price for the total number of shares of Common Stock offered by the rights, warrants or options so issued (or the aggregate conversion price of the convertible securities offered by such rights, warrants or options) would purchase at such current market price, and the denominator of which shall be the number of shares of Common Stock outstanding on such record date plus the number of additional shares of Common Stock offered by such rights, warrants or options (or into which the convertible securities so offered by such rights, warrants or options are convertible). Such adjustment shall be made successively whenever any such rights, warrants or options are issued, and shall become effective immediately after such record date. If at the end of the period during which such rights, warrants or options are exercisable not all rights, warrants

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or options shall have been exercised, the adjusted Conversion Price shall be immediately readjusted to what it would have been upon application of the foregoing adjustment substituting the number of additional shares of Common Stock actually issued (or the number of shares of Common Stock issuable upon conversion of convertible securities actually issued) for the total number of shares of Common Stock offered (or the convertible securities offered).

        (c)  In case the Company shall distribute to all or substantially all holders of its Common Stock any shares of capital stock of the Company (other than Common Stock) or evidences of its indebtedness, cash, other securities or other assets, or shall distribute to all or substantially all holders of its Common Stock, rights, warrants or options to subscribe for or purchase any of its securities (excluding (i) rights, options, warrants and other securities referred to in subsection (b) above or (d) or (g) below; (ii) those dividends, distributions, subdivisions and combinations referred to in subsection (a) above; and (iii) dividends and distributions paid in cash in an aggregate amount that, combined together with (A) all other such cash distributions made within the preceding 12 months in respect of which no adjustment has been made under this Section 4.6 and (B) the fair market value of consideration payable in respect of any repurchases (including by way of tender or exchange offers) by the Company or any of its Subsidiaries or Affiliates, of Common Stock concluded within the preceding 12 months, in each case in respect of which no adjustment has been made under this Section 4.6, does not exceed 10% of Market Capitalization as of the record date for such distribution), then in each such case the Conversion Price shall be adjusted so that the same shall equal the price determined by multiplying the Conversion Price in effect immediately prior to the date of such distribution or purchase by a fraction, the numerator of which shall be the current market price per share (as defined in subsection (f) below) of the Common Stock on the record date mentioned below less the fair market value on such record date (as determined by the Board of Directors of the Company, whose determination shall be conclusive evidence of such fair market value) of the portion of the capital stock or evidences of indebtedness, securities or assets so distributed or of such rights, warrants or options, in each case as applicable to one share of Common Stock, and the denominator of which shall be the current market price per share (as defined in subsection (f) below) of the Common Stock on such record date. Such adjustment shall become effective immediately after the record date for the determination of stockholders entitled to receive such distribution.

        (d)  In the event the Company pays a dividend or makes a distribution to all holders of its Common Stock consisting of publicly-traded capital stock of any class or series, or similar equity interests, of or relating to a Subsidiary or other business unit of the Company, the Conversion Price shall be adjusted in accordance with the formula:

CP' =         CP        
                (1+  F  )
                        M

where:

CP' = the adjusted Conversion Price

CP = the current Conversion Price

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        M = the average of the closing sale prices of the Common Stock for the 10 trading days commencing on and including the fifth trading day after the date on which "ex-dividend trading" commences for such dividend or distribution on The New York Stock Exchange or such other national or regional exchange or market which such securities are then listed or quoted.

        F = the average of the closing sale prices of the securities distributed in respect of each share of Common Stock for which this Section 4.6(d) applies for the 10 trading days commencing on and including the fifth trading day after the date on which "ex-dividend trading" commences for such dividend or distribution on The New York Stock Exchange or such other national or regional exchange or market which such securities are then listed or quoted.

        (e)  In case the Company or any of its Subsidiaries shall repurchase (including by way of tender or exchange offer) shares of Common Stock, and the fair market value of the sum of (i) the aggregate consideration paid for such Common Stock, (ii) the aggregate fair market value of cash dividends and distributions of the type described in clause (iii) of paragraph (c) above paid within the twelve (12) months preceding the date of purchase of such shares of Common Stock in respect of which no adjustment pursuant to this Section 4.6 previously has been made, and (iii) the aggregate fair market value of any amounts previously paid for the repurchase of Common Stock of a type described in this paragraph (e) within the twelve (12) months preceding the date of purchase of such shares of Common Stock in respect of which no adjustment pursuant to this Section 4.6 previously has been made, exceeds 10% of Market Capitalization on the date of, and after giving effect to, such repurchase, then the Conversion Price shall be adjusted so that the same shall equal the price determined by multiplying the Conversion Price in effect immediately prior to the date of such distribution or purchase by a fraction, the numerator of which shall be the current market price per share (as defined in subsection (f) below) of the Common Stock on the date of such repurchase, less the quotient obtained by dividing the Aggregate Market Premium involved in such repurchase (as defined hereinafter) by the difference between the number of shares of Common Stock outstanding before such repurchase and the number of shares of Common Stock the subject of such repurchase, and the denominator of which shall be the current market price per share (as defined in subsection (f) below) of the Common Stock on the date of such repurchase. Such adjustment shall become effective immediately after the date of such repurchase. For purposes of this subsection (e), the "Aggregate Market Premium" is the excess, if any, of the aggregate repurchase price paid for all such Common Stock over the aggregate current market value per share (as defined in subsection (f) below) of all such repurchased stock, determined with respect to each share involved in each such repurchase as of the date of repurchase with respect to such share.

        (f)    For the purpose of any computation under subsections (b), (c) and (e) above, the current market price per share of Common Stock on any date shall be deemed to be the average of the Closing Prices for 20 consecutive Trading Days commencing 30 Trading Days before the record date with respect to any distribution, issuance or other event requiring such computation. The Closing Price for each day shall be (i) the last sale price, or the closing bid price if no sale occurred, of such class of stock on the principal securities exchange on which such class of stock is listed, if the Common Stock is listed or admitted for trading on any national securities exchange, (ii) the last reported sale price of Common Stock on any system of automated dissemination of quotations of securities prices then in common use, if so quoted, or (iii) if not quoted as described in clause (i), the mean between the high bid and low asked quotations for

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Common Stock as reported by the National Quotation Bureau Incorporated if at least two securities dealers have inserted both bid and asked quotations for such class of stock on at least 5 of the 10 preceding days. If the Common Stock is quoted on a national securities or central market system, in lieu of a market or quotation system described above, the Closing Price shall be determined in the manner set forth in clause (iii) of the preceding sentence if bid and asked quotations are reported but actual transactions are not, and in the manner set forth in clause (ii) of the preceding sentence if actual transactions are reported. If none of the conditions set forth above is met, the Closing Price of Common Stock on any day or the average of such last reported sale prices for any period shall be the fair market value of such class of stock as determined by a member firm of the New York Stock Exchange selected by the Company. As used herein the term "Trading Days" with respect to Common Stock means (i) if the Common Stock is listed or admitted for trading on any national securities exchange, days on which such national securities exchange is open for business or (ii) if the Common Stock is quoted on a system of automated dissemination of quotations of securities prices, days on which trades may be made on such system.

        (g)  If the Company has implemented or implements a Stockholder Rights Plan (as defined below), the Company agrees that such Stockholder Rights Plan will provide that upon any conversion of the Securities by any Holder prior to a Trigger Event (as defined below), the Holders shall receive the rights, warrants or options issued under such plan. Rights, warrants or options distributed by the Company to all holders of Common Stock entitling the holders thereof to subscribe for or purchase shares of the Company's capital stock (either initially or under certain circumstances), which rights, warrants or options, until the occurrence of a specified event or events (a "Trigger Event"):

(i)

are deemed to be transferred with such shares of Common Stock,



(ii)

are not exercisable, and



(iii)

are also issued in respect of future issuances of Common Stock,

(a "Stockholder Rights Plan") shall not be deemed distributed for purposes of this Section 4.6 and no adjustment to the Conversion Price shall be required to be made until the occurrence of the earliest Trigger Event. In addition, in the event of any Trigger Event with respect thereto, that shall have resulted in an adjustment to the Conversion Price under this Section 4.6, (1) in the case of any such rights, warrants or options which shall all have been redeemed or repurchased without exercise by any holders thereof, the Conversion Price shall be readjusted upon such final redemption or repurchase to give effect to such distribution or Trigger Event, as the case may be, as though it were a cash distribution, equal to the per share redemption or repurchase price received by a holder of Common Stock with respect to such rights, warrants or options (assuming such holder had retained such rights, warrants or options), made to all holders of Common Stock as of the date of such redemption or repurchase, and (2) in the case of any such rights, warrants or options all of which shall have expired without exercise by any holder thereof, the Conversion Price shall be readjusted as if such issuance had not occurred.

        In any case in which this Section 4.6 shall require that an adjustment be made immediately following a record date established for purposes of this Section 4.6, the Company

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may elect to defer (but only until five Business Days following the filing by the Company with the Trustee of the certificate described in Section 4.10) issuing to the holder of any Security converted after such record date the shares of Common Stock and other capital stock of the Company issuable upon such conversion over and above the shares of Common Stock and other capital stock of the Company issuable upon such conversion only on the basis of the Conversion Price prior to adjustment; and, in lieu of the shares the issuance of which is so deferred, the Company shall issue or cause its transfer agents to issue due bills or other appropriate evidence of the right to receive such shares.

SECTION 4.7. NO ADJUSTMENT.

        No adjustment in the Conversion Price shall be required unless the adjustment would require an increase or decrease of at least 1% in the Conversion Price as last adjusted; provided, however, that any adjustments which by reason of this Section 4.7 are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Article 4 shall be made to the nearest cent or to the nearest one-hundredth of a share, as the case may be.

        No adjustment need be made for rights to purchase Common Stock or issuances of Common Stock pursuant to a Company plan for reinvestment of dividends or interest.

        No adjustment need be made for a change in the par value or a change to no par value of the Common Stock.

        To the extent that the Securities become convertible into cash, no adjustment need be made thereafter as to the cash. Interest will not accrue on the cash.

SECTION 4.8. EQUIVALENT ADJUSTMENTS.

        In the event that, as a result of an adjustment made pursuant to Section 4.6 above, the holder of any Security thereafter surrendered for conversion shall become entitled to receive any shares of capital stock of the Company other than shares of its Common Stock, thereafter the Conversion Price of such other shares so receivable upon conversion of any Securities shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to Common Stock contained in this Article 4.

SECTION 4.9. ADJUSTMENT FOR TAX PURPOSES.

        The Company shall be entitled to make such reductions in the Conversion Price, in addition to those required by Section 4.6, as it in its discretion shall determine to be advisable in order that any stock dividends, subdivision of shares, distribution of rights to purchase stock or securities, or a distribution or securities convertible into or exchangeable for stock hereafter made by the Company to its stockholders shall not be taxable.

SECTION 4.10. NOTICE OF ADJUSTMENT.

        Whenever the Conversion Price is adjusted, or Securityholders become entitled to other securities or due bills, the Company shall promptly mail to Securityholders a notice of the

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adjustment and file with the Trustee an Officers' Certificate briefly stating the facts requiring the adjustment and the manner of computing it. The certificate shall be conclusive evidence of the correctness of such adjustment and the Trustee may conclusively assume that, unless and until such certificate is received by it, no such adjustment is required.

SECTION 4.11. NOTICE OF CERTAIN TRANSACTIONS.

        In case:

        (a)  the Company shall declare a dividend (or any other distribution) on its Common Stock (other than in cash out of retained earnings); or

        (b)  the Company shall authorize the granting to the holders of its Common Stock of rights, warrants or options to subscribe for or purchase any share of any class or any other rights, warrants or options; or

        (c)  of any reclassification of the Common Stock of the Company (other than a subdivision or combination of its outstanding Common Stock, or a change in par value, or from par value to no par value, or from no par value to par value), or of any consolidation or merger to which the Company is a party and for which approval of any stockholders of the Company is required, or of the sale or transfer of all or substantially all of the assets of the Company; or

        (d)  of the voluntary or involuntary dissolution, liquidation or winding-up of the Company.

the Company shall cause to be filed with the Trustee and to be mailed to each holder of Securities at its address appearing on the list provided for in Section 2.5, as promptly as possible but in any event at least ten days prior to the applicable date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution or rights, warrants or options, or, if a record is not to be taken, the date as of which the holders of Common Stock of record to be entitled to such dividend, distribution or rights are to be determined, or (y) the date on which such reclassification, consolidation, merger, sale, transfer, dissolution, liquidation or winding-up is expected to become effective or occur, and the date as of which it is expected that holders of Common Stock of record shall be entitled to exchange their Common Stock for securities or other property deliverable upon such reclassification, consolidation, merger, sale, transfer, dissolution, liquidation or winding-up. Failure to give such notice, or any defect therein, shall not affect the legality or validity of such dividend, distribution, reclassification, consolidation, merger, sale, transfer, dissolution, liquidation or winding-up.

SECTION 4.12. EFFECT OF RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE ON CONVERSION PRIVILEGE.

        If any of the following shall occur, namely: (i) any reclassification or change of outstanding shares of Common Stock (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination); (ii) any consolidation, combination or merger to which the Company is a party other than a merger in which the Company is the continuing corporation and which does not result in any

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reclassification of, or change (other than a change in name, or par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination) in, outstanding shares of Common Stock; or (iii) any sale or conveyance of all or substantially all of the assets of the Company, then the Company, or such successor or purchasing corporation, as the case may be, shall, as a condition precedent to such reclassification, change, consolidation, merger, sale or conveyance, execute and deliver to the Trustee a supplemental indenture providing that the Holder of each Security then outstanding shall have the right to convert such Security into the kind and amount of shares of stock and other securities and property (including cash) receivable upon such reclassification, change, consolidation, merger, sale or conveyance by a holder of the number of shares of Common Stock deliverable upon conversion of such Security immediately prior to such reclassification, change, consolidation, merger, sale or conveyance. Such supplemental indenture shall provide for adjustments of the Conversion Price which shall be as nearly equivalent as maybe practicable to the adjustments of the Conversion Price provided for in this Article 4. If, in the case of any such consolidation, merger, sale or conveyance, the stock or other securities and property (including cash) receivable thereupon by a holder of Common Stock includes shares of stock or other securities and property of a corporation other than the successor or purchasing corporation, as the case may be, in such consolidation, merger, sale or conveyance, then such supplemental indenture shall also be executed by such other corporation and shall contain such additional provisions to protect the interests of the Holders of the Securities as the Board of Directors of the Company shall reasonably consider necessary by reason of the foregoing. The provision of this Section 4.12 shall similarly apply to successive consolidations, mergers, sales or conveyances. Notwithstanding the foregoing, a distribution by the Company to all or substantially all holders of its Common Stock for which an adjustment to the Conversion Price or provision for conversion of the Securities may be made pursuant to Section 4.6 shall not be deemed to be a sale or conveyance of all or substantially all of the assets of the Company for purposes of this Section 4.12.

        In the event the Company shall execute a supplemental indenture pursuant to this Section 4.12, the Company shall promptly file with the Trustee an Opinion of Counsel stating that such supplemental indenture is authorized or permitted by this Indenture and an Officers' Certificate briefly stating the reasons therefor, the kind or amount of shares of stock or securities or property (including cash) receivable by Holders of the Securities upon the conversion of their Securities after any such reclassification, change, consolidation, merger, sale or conveyance, any adjustment to be made with respect thereto and that all conditions precedent have been complied with.

SECTION 4.13. TRUSTEE'S DISCLAIMER.

        The Trustee has no duty to determine when an adjustment under this Article 4 should be made, how it should be made or what such adjustment should be, but may accept as conclusive evidence of the correctness of any such adjustment, and shall be protected in relying upon, the Officers' Certificate with respect thereto which the Company is obligated to file with the Trustee pursuant to Section 4.10. The Trustee shall not be accountable for and makes no representation as to the validity or value of any securities or assets issued upon conversion of Securities, and the Trustee shall not be responsible for the Company's failure to comply with any provisions of this

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Article 4. Each Conversion Agent (other than the Company or an Affiliate of the Company) shall have the same protection under this Section 4.13 as the Trustee.

        The Trustee shall not be under any responsibility to determine the correctness of any provisions contained in any supplemental indenture executed pursuant to Section 4.12, but may accept as conclusive evidence of the correctness thereof, and shall be protected in relying upon, the Officers' Certificate with respect thereto which the Company is obligated to file with the Trustee pursuant to Section 4.12.

SECTION 4.14. VOLUNTARY REDUCTION.

        The Company from time to time may reduce the Conversion Price by any amount for any period of time if the period is at least 20 days or such longer period as may be required by law and if the reduction is irrevocable during the period; provided that in no event may the Conversion Price be less than the par value of a share of Common Stock.

ARTICLE 5.

SUBORDINATION

SECTION 5.1. SECURITIES SUBORDINATED TO SENIOR INDEBTEDNESS.

        The Company covenants and agrees, and each Holder of Securities by his acceptance thereof likewise covenants and agrees, that all Securities are subject to the provisions of this Article 5; and each Person holding any Security, whether upon original issue or upon transfer or assignment thereof, accepts and agrees to be bound by such provisions and acknowledges that such provisions are for the benefit of, and shall be enforceable directly by, the holders of Senior Indebtedness.

        Each Holder of Securities authorizes and directs the Trustee on such Holder's behalf to take such action as may be necessary or appropriate, in the sole discretion of the Trustee, to acknowledge or effectuate the subordination between the Holders of Securities and the holders of Senior Indebtedness as provided in this Article and appoints the Trustee as such Holder's attorney-in-fact for any and all such purposes.

        The payment of the principal of, premium, if any, and interest on and any other payment due pursuant to this Indenture or any Securities issued hereunder (including, without limitation, the payment or deposit of the Redemption Price or Repurchase Price pursuant to Article 3 and any deposit pursuant to Section 6.3) shall, to the extent and in the manner hereinafter set forth, be subordinated and subject in right of payment to the prior payment in full of all Senior Indebtedness, whether outstanding at the date of this Indenture or thereafter created, incurred, assumed or guaranteed.

        Each Holder by accepting a Security acknowledges and agrees that the subordination provision set forth in this Article 5 are, and are intended to be, an inducement and consideration to each holder of any Senior Indebtedness of the Company, whether such Senior Indebtedness was created before or after the issuance of the Securities, to acquire and continue to hold, or to continue to hold, such Senior Indebtedness, and such holder of Senior Indebtedness shall be

38

deemed conclusively to have relied upon such subordination provisions in acquiring and continuing to hold, or in continuing to hold, such Senior Indebtedness, and such holder is made an obligee hereunder and may enforce directly such subordination provisions.

SECTION 5.2. SECURITIES SUBORDINATED TO PRIOR PAYMENT OF ALL SENIOR INDEBTEDNESS ON DISSOLUTION, LIQUIDATION, REORGANIZATION, ETC., OF THE COMPANY.

        Upon any payment or distribution of the assets of the Company of any kind or character, whether in cash, property or securities (including any collateral at any time securing the Securities), to creditors upon any dissolution, winding-up, total or partial liquidation, or reorganization of the Company (whether voluntary or involuntary, or in bankruptcy, insolvency, reorganization, liquidation, or receivership proceedings, or upon an assignment for the benefit of creditors, or any marshalling of the assets of the Company, or upon any similar proceedings), then in such event:

        (a)  all Senior Indebtedness (including principal thereof and interest thereon) shall first be paid in full before any Payment of the Securities (as defined in Section 5.5) is made;

        (b)  any payment or distribution of assets of the Company of any kind or character, whether in cash, property or securities (including any collateral at any time securing the Securities), to which the Holders or the Trustee on behalf of the Holders would be entitled except for the provisions of this Article 5, including any such payment or distribution which may be payable or deliverable by reason of the payment of another debt of the Company being subordinated to the payment of the Securities, shall be paid or delivered by any debtor, Custodian or other person making such payment or distribution, directly to the holders of the Senior Indebtedness or their Representative or Representatives, or to the trustee or trustees under any indenture pursuant to which any instruments evidencing any of such Senior Indebtedness may have been issued, ratably according to the aggregate amounts remaining unpaid on account of the principal of and interest on the Senior Indebtedness held or represented by each, for application to payment of all Senior Indebtedness remaining unpaid, to the extent necessary to pay all Senior Indebtedness in full after giving effect to any concurrent payment or distribution, or provision therefor, to the holders of such Senior Indebtedness; and

        (c)  in the event that, notwithstanding the foregoing provisions of this Section 5.2, any payment or distribution of assets of the Company of any kind or character, whether in cash, property or securities, shall be received by the Trustee or the Holders before all Senior Indebtedness is paid in full, such payment or distribution (subject to the provisions of Sections 5.6 and 5.7) shall be held in trust for the benefit of, and shall be immediately paid or delivered by the Trustee or such Holders, as the case may be, to the holders of Senior Indebtedness remaining unpaid, or their Representative or Representatives, ratably according to the aggregate amounts remaining unpaid on account of the principal of and interest on the Senior Indebtedness held or represented by each, for application to the payment of all Senior Indebtedness remaining unpaid, to the extent necessary to pay all Senior Indebtedness in full after giving effect to any concurrent payment or distribution, or provision therefor, to or for the holders of such Senior Indebtedness.

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        The Company shall give prompt notice to the Trustee of any dissolution, winding-up, liquidation or reorganization of the Company.

        Upon any prepayment, payment or distribution of assets of the Company referred to in this Article 5, the Trustee, subject to the provisions of Sections 9.1 and 9.2, and the Holders shall be entitled to conclusively rely upon any order or decree by any court of competent jurisdiction in which such dissolution, winding-up, liquidation or reorganization proceeding is pending, or a certificate of the liquidating trustee or agent or other person making any distribution to the Trustee or to the Holders, for the purpose of ascertaining the persons entitled to participate in such distribution, the holders of the Senior Indebtedness and other indebtedness of the Company, the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Article 5; provided that the foregoing shall apply only if such court, trustee, liquidating trustee or other person has been fully apprised of the provisions of this Article.

SECTION 5.3. SECURITYHOLDERS TO BE SUBROGATED TO RIGHT OF HOLDERS OF SENIOR INDEBTEDNESS.

        Subject to the prior payment in full of all Senior Indebtedness, the Holders shall be subrogated (equally and ratably with the holders of all indebtedness of the Company which by its express terms is subordinated to indebtedness of the Company to substantially the same extent as the Securities are subordinated and is entitled to like rights of subrogation) to the rights of the holders of Senior Indebtedness to receive payments or distributions of assets of the Company applicable to the Senior Indebtedness until the principal of and interest on the Securities shall be paid in full, and for purposes of such subrogation, no payments or distributions to the holders of Senior Indebtedness of assets, whether in cash, property or securities, distributable to the holders of Senior Indebtedness under the provisions hereof to which the Holders would be entitled except for the provisions of this Article 5, and no payment pursuant to the provisions of this Article 5 to the holders of Senior Indebtedness by the Holders shall, as among the Company, its creditors other than the holders of Senior Indebtedness, and the Holders, be deemed to be a payment by the Company to or on account of Senior Indebtedness, it being understood that the provisions of this Article 5 are, and are intended, solely for the purpose of defining the relative rights of the Holders, on the one hand, and the holders of Senior Indebtedness, on the other hand.

SECTION 5.4. OBLIGATIONS OF THE COMPANY UNCONDITIONAL.

        Nothing contained in this Article 5 or elsewhere in this Indenture or in any Security is intended to or shall impair the obligation of the Company, which is absolute and unconditional, to pay to the Holders the principal of and interest on the Securities, as and when the same shall become due and payable in accordance with the terms of the Securities, or to affect the relative rights of the Holders and other creditors of the Company other than the holders of Senior Indebtedness, nor shall anything herein or therein prevent the Trustee or any Holder from exercising all remedies otherwise permitted by applicable law upon the happening of an Event of Default under this Indenture, subject to the provisions of Article 8, and the rights, if any, under this Article 5 of the holders of Senior Indebtedness in respect of assets, whether in cash, property or securities, of the Company received upon the exercise of any such remedy.

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SECTION 5.5. COMPANY NOT TO MAKE PAYMENT WITH RESPECT TO SECURITIES IN CERTAIN CIRCUMSTANCES.

        Upon the occurrence of a Payment Default, unless and until the amount of Designated Senior Indebtedness affected by such Payment Default then due shall have been paid in full, or such default shall have been cured or waived or shall have ceased to exist, the Company shall not pay principal of, premium, if any, or interest on the Securities or any other amount due pursuant to this Indenture or any Securities or make any deposit pursuant to Article 3 or Section 6.3 or 10.1 and shall not repurchase, redeem or otherwise retire any Securities (collectively, "Payment of the Securities").

        Unless Section 5.2 shall be applicable, upon (1) the occurrence of a default on Designated Senior Indebtedness (other than a Payment Default) that occurs and is continuing that permits the holders of such Designated Senior Indebtedness (or their Representative or Representatives) to accelerate its maturity and (2) receipt by the Company and the Trustee from the Senior Agent of written notice of such occurrence and the imposition of a Payment Blockage Period hereunder, then the Company shall not make any Payment of the Securities for a period (the "Payment Blockage Period") commencing on the earlier of the date of receipt by the Company or the Trustee of such notice from the Senior Agent and ending on the earlier of (subject to any blockage of payments that may then be in effect under this Section 5.5) (x) the date 179 days after such date, (y) the date such default shall have been cured or waived in writing or shall have ceased to exist or such Senior Indebtedness shall have been discharged, or (z) the date such Payment Blockage Period shall have been terminated by written notice to the Company or the Trustee from the Senior Agent, after which, in case of clause (x), (y) or (z), as the case may be, the Company shall resume making any and all required payments. Notwithstanding any other provision of this Indenture, only one Payment Blockage Period may be commenced within any consecutive 365-day period, and no event of default with respect to any Designated Senior Indebtedness which existed or was continuing on the date of the commencement of any Payment Blockage Period with respect to such Designated Senior Indebtedness shall be, or can be made, the basis for the commencement of a second Payment Blockage Period whether or not within a period of 365 consecutive days unless such event of default shall have been cured or waived for a period of not less than 90 consecutive days. In no event will a Payment Blockage Period extend beyond 179 days.

        In the event that, notwithstanding the foregoing provisions of this Section 5.5, any Payment of the Securities shall be made by or on behalf of the Company and received by the Trustee, any Holder or any Paying Agent (or, if the Company is acting as its own Paying Agent, money for any such payment shall be segregated and held in trust), which payment was prohibited by this Section 5.5, then, unless and until the amount of Senior Indebtedness then due, as to which a default shall have occurred, shall have been paid in full, or such default shall have been cured or waived, such payment (subject, in each case, to the provisions of Sections 5.6 and 5.7) shall be held in trust for the benefit of, and shall be immediately paid over to, the holders of Senior Indebtedness or their Representative or Representatives, ratably according to the aggregate amounts remaining unpaid on account of the principal of and interest on the Senior Indebtedness held or represented by each, for application to the payment of all Senior Indebtedness remaining unpaid to the extent necessary to pay all Senior Indebtedness in accordance with its terms, after

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giving effect to any concurrent payment or distribution to or for the benefit of the holders of Senior Indebtedness. The Company shall give prompt written notice to the Trustee of any default under any Senior Indebtedness or under any agreement pursuant to which Senior Indebtedness may have been issued.

SECTION 5.6. NOTICE TO TRUSTEE.

        The Company shall give prompt written notice to the Trustee of any fact known to the Company which would prohibit the making of any payment to or by the Trustee in respect of the Securities, but failure to give such notice shall not affect the subordination provided in this Article 5 of the Securities to Senior Indebtedness. Notwithstanding the provisions of this Article 5 or any other provision of this Indenture, the Trustee shall not at any time be charged with knowledge of the existence of any facts which would prohibit the making of any payment to or by the Trustee, unless and until the Trustee shall have received written notice thereof from the Company or from the holder or holders of Senior Indebtedness or from their Representative or Representatives; and, prior to the receipt of any such notice, the Trustee, subject to the provisions of Sections 9.1 and 9.2, shall be entitled to assume conclusively that no such facts exist.

        The Trustee shall be entitled to conclusively rely on the delivery to it of a written notice by a Person representing himself to be a holder of Senior Indebtedness (or a Representative of such holder) to establish that such notice has been given by a holder of Senior Indebtedness or a Representative of any such holder. In the event that the Trustee determines in good faith that further evidence is required with respect to the right of any Person as a holder of Senior Indebtedness to participate in any payment or distribution pursuant to this Article 5, the Trustee may request such Person to furnish evidence to the reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness held by such Person, the extent to which such Person is entitled to participate in such payment or distribution and any other facts pertinent to the rights of each Person under this Article 5, and if such evidence is not furnished, the Trustee may defer any payment to such Person pending judicial determination as to the right of such Person to receive such payment.

SECTION 5.7. APPLICATION BY TRUSTEE OF MONIES DEPOSITED WITH IT.

        Money or U.S. Government Obligations deposited in trust with the Trustee pursuant to Sections 6.3 and 10.1 and not in violation of this Article 5 shall be for the sole benefit of Securityholders and shall thereafter not be subject to the subordination provisions of this Article 5. Otherwise, any deposit of monies by the Company with the Trustee or any Paying Agent (whether or not in trust) for the payment of the principal of or interest on any Securities shall be subject to the provisions of Sections 5.1, 5.2, 5.3 and 5.5; except that, if at least three Business Days prior to the date on which by the terms of this Indenture any such monies may become payable for any purpose (including, without limitation, the payment of either the principal of or interest on any Security), a Trust Officer of the Trustee shall not have received with respect to such monies the notice provided for in Section 5.6, then the Trustee or any Paying Agent shall have full power and authority to receive such monies and to apply such monies to the purpose for which they were received, and shall not be affected by any notice to the contrary which may be received by it within three Business Days prior to or after such date. This Section 5.7 shall be construed solely for the benefit of the Trustee and the Paying Agent and shall not otherwise

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affect the rights that holders of Senior Indebtedness may have to recover any such payments from the Holders in accordance with the provisions of this Article 5.

SECTION 5.8. SUBORDINATION RIGHTS NOT IMPAIRED BY ACTS OR OMISSIONS OF THE COMPANY OR HOLDERS OF SENIOR INDEBTEDNESS.

        No right of any present or future holders of any Senior Indebtedness to enforce subordination, as herein provided, shall at any time in any way be prejudiced or impaired by any act or failure to act on the part of the Company or by any act or failure to act, in good faith, by any such holder, or by any noncompliance by the Company with the terms, provisions and covenants of this Indenture, regardless of any knowledge thereof which any such holder may have or be otherwise charged with. The holders of any Senior Indebtedness may extend, renew, modify or amend the terms of such Senior Indebtedness or any security therefor and release, sell or exchange such security and otherwise deal freely with the Company, all without affecting the liabilities and obligations of the parties to this Indenture or the Holders. No amendment of this Article 5 or any defined terms used herein or any other Sections referred to in this Article 5 which adversely affects the rights hereunder of holders of Senior Indebtedness, shall be effective unless the holders of such Senior Indebtedness (required pursuant to the terms of such Senior Indebtedness to give such consent) have consented thereto.

SECTION 5.9. TRUSTEE TO EFFECTUATE SUBORDINATION.

        Each Holder of a Security by his acceptance thereof authorizes and directs the Trustee on his behalf to take such action as may be necessary or appropriate to acknowledge and effectuate the subordination provided in this Article 5 and appoints the Trustee his attorney-in-fact for any and all such purposes.

SECTION 5.10. RIGHT OF TRUSTEE TO HOLD SENIOR INDEBTEDNESS.

        The Trustee, in its individual capacity, shall be entitled to all of the rights set forth in this Article 5 in respect of any Senior Indebtedness at any time held by it to the same extent as any other holder of Senior Indebtedness, and nothing in this Indenture shall be construed to deprive the Trustee of any of its rights as such holder. Nothing in this Article 5 shall apply to claims of, or payments to, the Trustee under or pursuant to Section 9.7.

SECTION 5.11. ARTICLE 5 NOT TO PREVENT EVENTS OF DEFAULT.

        The failure to make a Payment of the Securities by reason of any provision in this Article 5 shall not be construed as preventing the occurrence of an Event of Default under Section 8.1.

SECTION 5.12. NO FIDUCIARY DUTY CREATED TO HOLDERS OF SENIOR INDEBTEDNESS.

        Notwithstanding any other provision in this Article 5, the Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior Indebtedness by virtue of the provisions of this Article 5 or otherwise. With respect to the holders of Senior Indebtedness, the Trustee undertakes to perform or to observe only such of its covenants or obligations as are specifically

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set forth in this Article 5 and no implied covenants or obligations with respect to holders of Senior Indebtedness shall be read into this Indenture against the Trustee.

SECTION 5.13. ARTICLE APPLICABLE TO PAYING AGENTS.

        In case at any time any Paying Agent other than the Trustee shall have been appointed by the Company and be then acting hereunder, the term "Trustee" as used in this Article 5 shall in such case (unless the context shall otherwise require) be construed as extending to and including such Paying Agent within its meaning as fully for all intents and purposes as if such Paying Agent were named in this Article 5 in addition to or in place of the Trustee; provided, however, that Sections 5.6, 5.10 and 5.12 shall not apply to the Company if it acts as Paying Agent.

SECTION 5.14. CERTAIN CONVERSION DEEMED PAYMENT.

        For the purposes of this Article 5 only, (1) the issuance and delivery of junior securities upon conversion of Securities in accordance with Article 4 shall not be deemed to constitute a payment or distribution on account of the principal of or premium or interest on Securities or on account of the purchase or other acquisition of Securities, and (2) the payment, issuance or delivery of cash, property or securities (other than junior securities) upon conversion of a Security shall be deemed to constitute payment on account of principal of such Security. For the purposes of this Section, the term "junior securities" means (a) shares of any stock of any class of the Company and (b) securities of the Company which are subordinated in right of payment to all Senior Indebtedness which may be outstanding at the time of issuance or delivery of such securities to substantially the same extent as, or to a greater extent than, the Securities are so subordinated as provided in this Article. Nothing contained in this Article or elsewhere in this Indenture or in the Securities is intended to or shall impair, as among the Company, its creditors other than holders of Senior Indebtedness and the Holders of the Securities, the right, which is absolute and unconditional, of the Holder of any Security to convert such Security in accordance with Article 4.

SECTION 5.15. CONTRACTUAL SUBORDINATION.

        This Article 5 represents a bona fide agreement of contractual subordination pursuant to Section 510(b) of the Title 11, U.S. Code.

ARTICLE 6.

COVENANTS

SECTION 6.1. PAYMENT OF SECURITIES.

        The Company covenants and agrees that it will duly and punctually pay or cause to be paid the principal amount at maturity, Redemption Price, Repurchase Price and interest, in respect of each of the Securities at the places, at the respective times and in the manner provided herein and in the Securities. Each installment of interest on the Securities may be paid by mailing checks for the interest payable to or upon the written order of the Holders of Securities entitled thereto as they shall appear on the registry books of the Company; provided that with respect to any Holder of Securities with an aggregate principal amount equal to or in excess of

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$5 million, at the request of such Holder in writing the Company shall pay interest on such Holder's Securities by wire transfer in immediately available funds to an account in the continental United States.

SECTION 6.2. SEC REPORTS; 144A INFORMATION.

        The Company shall file all reports and other information and documents which it is required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act, and within 15 days after it files them with the SEC, the Company shall file copies of all such reports, information and other documents with the Trustee. The Company will cause any quarterly and annual reports which it mails to its stockholders to be mailed to the Holders of the Securities.

        In the event the Company is at any time no longer subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company will prepare, for the first three quarters of each fiscal year, quarterly financial statements substantially equivalent to the financial statements required to be included in a report on Form 10-Q under the Exchange Act and the Company will also prepare, on an annual basis, complete audited consolidated financial statements including, but not limited to, a balance sheet, a statement of income and retained earnings, a statement of cash flows and all appropriate notes. All such financial statements will be prepared in accordance with generally accepted accounting principles consistently applied, except for changes with which the Company's independent accountants concur, and except that quarterly statements may be subject to year-end adjustments. The Company will cause a copy of such financial statements to be filed with the Trustee and mailed to the Holders of the Securities within 60 days after the close for each of the first three quarters of each fiscal year and within 105 days after the close of each fiscal year. The Company will also comply with the other provisions of TIA 314(a).

        Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee's receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company's compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers' Certificates).

        At any time when the Company is not subject to Section 13 or 15(d) of the Exchange Act, nor exempt from reporting pursuant to 12g3-2(b) under the Exchange Act, upon the request of a Holder or beneficial owner of a Security, the Company will promptly furnish or cause to be furnished Rule 144A Information (as defined below) to such Holder, to such beneficial owner or to prospective purchaser designated by such Securityholder or beneficial owner, as the case may be, in order to permit compliance by such Securityholder or beneficial owner with Rule 144A under the Securities Act in connection with the resale of such Security by such Securityholder or beneficial owner; provided, however, the Company shall not be required to furnish such information in connection with any request made on or after the date which is two years from the later of (i) the date such Security (or any predecessor Security) was acquired from the Company or (ii) the date such Security (or any predecessor Security) was last acquired from an "affiliate" of the Company within the meaning of Rule 144 under the Securities Act. "Rule 144A Information" shall be such information as is specified pursuant to Rule 144A(d)(4) under the Securities Act (or any successor provision thereto).

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SECTION 6.3. LIQUIDATION.

        Subject to the provisions of Article 5, insofar as they may be applicable hereto, the Board of Directors or the stockholders of the Company may not adopt a plan of liquidation which plan provides for, contemplates, or the effectuation of which is preceded by (a) the sale, lease, conveyance or other disposition of all or substantially all of the assets of the Company otherwise than substantially as an entirety (Article 7 being the Article which governs any such sale, lease, conveyance or other disposition substantially as an entirety), and (b) the distribution of all or substantially all of the proceeds of such sale, lease, conveyance or other disposition and of the remaining assets of the Company to the holders of the capital stock of the Company, unless the Company shall in connection with the adoption of such plan make provision for, or agree that prior to making any liquidating distributions to the holders of capital stock of the Company it will make provision for, the satisfaction of the Company's obligations hereunder and under the Securities as to the payment of principal and interest. The Company shall be deemed to have made provision for such payments only if (1) the Company irrevocably deposits in trust with the Trustee money or U.S. Government Obligations maturing as to principal and interest in such amounts and at such times as are sufficient, without consideration of any reinvestment of such interest, to pay the principal of and interest on the Securities then outstanding to maturity and to pay all other sums payable by it hereunder, or (2) there is an express assumption of the due and punctual payment of the Company's obligations hereunder and under the Securities and the performance and observance of all covenants and conditions to be performed by the Company hereunder, by the execution and delivery of a supplemental indenture in form reasonably satisfactory to the Trustee by a person who acquires, or will acquire (otherwise than pursuant to a lease) a portion of the assets of the Company, and which person will have Consolidated Net Worth (immediately after the acquisition) equal to not less than the Consolidated Net Worth of the Company (immediately preceding such acquisition), and which is a corporation organized under the laws of the United States, any State thereof or the District of Columbia; provided, however, that the Company shall not make any liquidating distribution to the holders of capital stock of the Company described in the first sentence of this Section 6.3 until after the Company shall have certified to the Trustee with an Officers' Certificate at least five days prior to the making of any liquidating distribution that it has complied with the provisions of this Section 6.3.

SECTION 6.4. COMPLIANCE CERTIFICATES.

        The Company shall deliver to the Trustee within 120 days after the end of each fiscal year of the Company, an Officers' Certificate as to the signer's knowledge of the Company's compliance with all conditions and covenants on its part contained in this Indenture and stating whether or not the signer knows of any default or Event of Default. If such signer knows of such a default or Event of Default, the Certificate shall describe the default or Event of Default and the efforts to remedy the same. For the purposes of this Section 6.4, compliance shall be determined without regard to any grace period or requirement of notice provided pursuant to the terms of this Indenture. The Certificate need not comply with Section 12.4.

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SECTION 6.5. NOTICE OF DEFAULTS.

        The Company will give notice to the Trustee, promptly, and in any event within five days, upon becoming aware thereof, of the existence of any Event of Default or an event which, with notice or the lapse of time or both would constitute an Event of Default hereunder.

SECTION 6.6. PAYMENT OF TAXES AND OTHER CLAIMS.

        The Company will pay or discharge or cause to be paid or discharged, before the same shall become delinquent, (1) all material taxes, assessments and governmental charges levied or imposed upon the Company, directly or by reason of its ownership of any Subsidiary or upon the income, profits or property of the Company; and (2) all material lawful claims for labor, materials and supplies, which, if unpaid, might by law become a lien upon the property of the Company; provided, however, that the Company shall not be required to pay or discharge or cause to be paid or discharged any such tax, assessment, charge or claim whose amount, applicability or validity is being contested in good faith by appropriate proceedings and for which adequate provision has been made.

SECTION 6.7. CORPORATE EXISTENCE.

        Subject to Section 6.3 and Article 7, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence and rights (charter and statutory); provided, however, that the Company shall not be required to preserve any right if the Company shall determine that the preservation is no longer desirable in the conduct of the Company's business and that the loss thereof is not, and will not be, adverse in any material respect to the Holders.

SECTION 6.8. MAINTENANCE OF PROPERTIES.

        Subject to Section 6.3, the Company will cause all material properties owned, leased or licensed in the conduct of its business to be maintained and kept in good condition, repair and working order and supplied with all necessary equipment and will cause to be made all necessary repairs, renewals, replacements, betterments and improvements thereof and thereto, all as in the judgment of the Company may be necessary so that the business carried on in connection therewith may be properly and advantageously conducted at all times while any Securities are outstanding; provided, however, that nothing in this Section 6.8 shall prevent the Company from doing otherwise if, in the judgment of the Company, the same is desirable in the conduct of the Company's business and is not, and will not be, adverse in any material respect to the Holders.

SECTION 6.9. FURTHER INSTRUMENTS AND ACTS.

        Upon request of the Trustee, the Company will execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purposes of this Indenture.

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SECTION 6.10. MAINTENANCE OF OFFICE OR AGENCY.

        The Company will maintain in The City of New York an office or agency where Securities may be presented or surrendered for payment or repurchase, where Securities may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served. The office of the agent of the Trustee in The City of New York shall be such office or agency of the Company, unless the Company shall designate and maintain some other office or agency for one or more of such purposes. The Company will give prompt written notice to the Trustee of any change in the location of any such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands.

        The Company may from time to time designate one or more other offices or agencies where the Securities may be presented or surrendered for any or all such purposes and may from time to time rescind such designation; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in The City of New York for such purposes. The Company will give prompt written notice to the Trustee of any such designation or rescission and any change in the location of any such office or agency.

SECTION 6.11. RESALE OF CERTAIN SECURITIES; REPORTING ISSUER.

        During the period beginning on the last date of original issuance of the Securities and ending on the date that is two years from such date, the Company will not, and will use all reasonable efforts not to permit any of its "affiliates" (as defined under Rule 144 under the Securities Act or any successor provision thereto) to, resell (x) any Securities which constitute "restricted securities" under Rule 144 or (y) any securities into which the Securities have been converted under this Indenture which constitute "restricted securities" under Rule 144, that in either case have been reacquired by any of them, except pursuant to an effective registration statement under the Securities Act. The Trustee shall have no responsibility in respect of the Company's performance of its agreement in the preceding sentence.

SECTION 6.12. REGISTRATION RIGHTS.

        (a) The Company agrees that the Holders (and any Person that has beneficial interest of a Security) from time to time of Registrable Securities (as such term is defined in the Registration Rights Agreement) are entitled to the benefits of the Registration Rights Agreement. Pursuant to the Registration Rights Agreement, the Company has agreed for the benefit of the Holders from time to time of Registrable Securities, at the Company's expense, (i) to file within 60 days after the last date of original issuance of the Securities, a registration statement (the "Registration Statement") with the Commission with respect to resales of the Restricted Securities, (ii) to use all reasonable efforts to cause such Registration Statement to be declared effective by the Commission not later than 180 days after the last date of original issuance of the Securities, and (iii) to use all reasonable efforts to maintain such Registration Statement

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continuously effective under the Securities Act subject to and in accordance with the terms of the Registration Rights Agreement.

        Liquidated Damages (the "Liquidated Damages") with respect to the Securities shall be assessed if a Registration Default (as defined in the Registration Rights Agreement) occurs. Liquidated Damages shall accrue on the Securities over and above the interest set forth in the title of the Securities from and including the date on which any such Registration Default shall occur, to but excluding the date on which such Registration Default has been cured (in the manner described in the Registration Rights Agreement), at a rate of 0.50% per annum.

        (b) Any amounts of Liquidated Damages due pursuant to clause (a) of this Section 6.12 shall be payable in cash on the regular interest Payment Dates. The amount of Liquidated Damages shall be determined by multiplying the applicable Liquidated Damages rate by the principal amount of the Securities, multiplied by a fraction, the numerator of such period (determined on the basis of a 360-day year comprised of twelve 30-day months), and the denominator of which is 360.

        Whenever in this Indenture there is mentioned, in any context, the payment of the principal of, premium, if any, or interest on, or in respect of, any Security, such mention shall be deemed to include mention of the payment of Liquidated Damages provided for in this Section to the extent that, in such context, Liquidated Damages are, were or would be payable in respect thereof pursuant to the provisions of this Section 6.12 and express mention of the payment of Liquidated Damages (if applicable) in any provisions hereof shall not be construed as excluding Liquidated Damages in those provisions hereof where such express mention is not made. A default by the Company under the Registration Rights Agreement, other than a default in the payment of Liquidated Damages, shall not be treated as a Default under this Indenture.

SECTION 6.13. LIQUIDATED DAMAGES.

        If Liquidated Damages is payable pursuant to the Registration Rights Agreement, the Company shall deliver to the Trustee a certificate to that effect stating (i) the amount of such Liquidated Damages that is payable and (ii) the date on which such Liquidated Damages is payable. Unless and until a Trust Officer receives at the Corporate Trust Office such a certificate, the Trustee may assume without inquiry that no such Liquidated Damages is payable. If the Company has paid Liquidated Damages directly to the Persons entitled to it, the Company shall deliver to the Trustee a certificate setting forth the particulars of such payment.

SECTION 6.14. STAY, EXTENSION AND USURY LAWS.

        The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Company (to the extent it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.

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ARTICLE 7.

SUCCESSOR CORPORATION

SECTION 7.1. WHEN COMPANY MAY MERGE, ETC.

        The Company shall not consolidate with or merge into any other Person, or convey, transfer or lease its properties and assets substantially as an entirety to any Person, and shall not permit any Person (other than a Subsidiary wholly-owned by the Company) to consolidate with or merge into the Company or convey, transfer or lease its properties and assets substantially as an entirety to the Company, unless:

        (a) in case the Company shall consolidate with or merge into another Person or convey, or transfer or lease its properties and assets substantially as an entirety to any Person, the Person formed by such consolidation or into which the Company is merged or the Person which acquires by conveyance or transfer, or which leases, the properties and assets of the Company substantially as an entirety shall be a corporation, partnership or trust, shall be organized and validly existing under the laws of the United States of America, any State thereof or the District of Columbia and shall expressly assume, by an indenture supplemental thereto, executed and delivered to the Trustee, in form satisfactory to the Trustee, the due and punctual payment of the principal of (and premium, if any) and interest on all the Securities and the performance or observance of every covenant of this Indenture on the part of the Company to be performed or observed and shall have provided for conversion rights in accordance with Section 4.12;

        (b) immediately after giving effect to such transaction, no Event of Default, and no event which, after notice or lapse of time or both, would become an Event of Default, shall have occurred and be continuing; and

        (c) the Company has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that such consolidation, merger, conveyance, transfer or lease and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture comply with this Article and that all conditions precedent herein provided for relating to such transaction have been complied with.

SECTION 7.2. SUCCESSOR CORPORATION SUBSTITUTED.

        Upon any consolidation of the Company with, or merger of the Company into, any other Person or any conveyance, transfer or lease of the properties and assets of the Company substantially as an entirety in accordance with Section 7.1, the successor Person formed by such consolidation or into which the Company is merged or to which such conveyance, transfer or lease is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor Person had been named as the Company herein, and thereafter, except in the case of a lease, the predecessor Person shall be relieved of all obligations and covenants under this Indenture and the Securities.

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ARTICLE 8.

DEFAULT AND REMEDIES

SECTION 8.1. EVENTS OF DEFAULT.

        An "Event of Default" occurs if:

        (1)  the Company defaults in the payment of any interest upon any of the Securities when due and payable and the default continues for a period of 30 days whether or not such payment is prevented by Article 5;

        (2)  the Company defaults in the payment of the principal of and premium, if any, on any of the Securities when due, including on a redemption date, whether or not such payment is prevented by Article 5;

        (3)  the Company fails to pay when due the principal of or interest on indebtedness for money borrowed by the Company or its Subsidiaries in excess of $10 million, or the acceleration of that indebtedness that is not withdrawn within 30 days after the date of written notice to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% in principal amount of the outstanding Securities;

        (4)  the Company fails to deliver shares of Common Stock within 15 days after such Common Stock is required to be delivered upon conversion of a Security as provided in this Indenture;

        (5)  a default by the Company in the performance, or breach, of any of the Company's other covenants in this Indenture which are not remedied by the end of a period of 60 days after written notice to the Trustee or to the Company and the Trustee by the Holders of at least 25% in principal amount of the outstanding Securities;

        (6)  the Company or any Significant Subsidiary pursuant to or within the meaning of any Bankruptcy Law:

        A. commences a voluntary case or proceeding;

        B. consents to the entry of an order for relief against it in an involuntary case or proceeding;

        C. consents to the appointment of a Custodian of it or for all or substantially all of its assets;

        D. makes a general assignment for the benefit of its creditors; or

        (7)  a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

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        A. is for relief against the Company or any Significant Subsidiary in an involuntary case or proceeding;

        B. appoints a Custodian of the Company or any Significant Subsidiary or for all or substantially all of the assets of any of them; or

        C. orders the liquidation of the Company or any Significant Subsidiary;

        and in each case the order or decree remains unstated and in effect for 60 days.

        The term "Bankruptcy Law" means Title 11, U.S. Code or any similar foreign, Federal or state law for the relief of debtors. For purposes of this Section 8.1, the term "Custodian" means any receiver, trustee, assignee, liquidator, sequestrator or similar official under any Bankruptcy Law.

        A default under clause (5) is not an Event of Default until the Trustee notifies the Company or the Holders of at least 25% in principal amount of the Securities then outstanding notify the Company and the Trustee, of the default, and the Company does not cure the default within 30 days after receipt of such notice. The notice given pursuant to this Section 8.1 must specify the default, demand that it be remedied and state that the notice is a "Notice of Default." When a default is cured, it ceases.

        Subject to the provisions of Sections 9.1 and 9.2, the Trustee shall not be charged with knowledge of any Event of Default unless written notice thereof shall have been given to a Trust Officer at the Corporate Trust Office of the Trustee by the Company, the Paying Agent, any Holder or an agent of any Holder. Within 30 days after a default, the Trustee must give to the registered Holders of Securities notice of all uncured defaults known to it.

SECTION 8.2. ACCELERATION.

        If an Event of Default (other than an Event of Default specified in Section 8.1(6) or (7)) occurs and is continuing, the Trustee may, by notice to the Company, or the Holders of at least 25% in principal amount of the Securities then outstanding may, by notice to the Company and the Trustee, and the Trustee shall, upon the request of such Holders, declare all unpaid principal of and accrued interest to the date of acceleration on the Securities then outstanding (if not then due and payable) to be due and payable upon any such declaration, and the same shall become and be immediately due and payable. If an Event of Default specified in Section 8.1(6) or (7) occurs, all unpaid principal of and accrued interest on the Securities then outstanding shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Securityholder.

        The Holders of a majority in principal amount of the Securities then outstanding by notice to the Trustee may rescind an acceleration and its consequences if (i) all existing Events of Default, other than the nonpayment of the principal of and accrued interest on the Securities which has become due solely by such declaration of acceleration, have been cured or waived; (ii) the Company has paid or deposited with the Trustee a sum sufficient to pay (a) all overdue interest on the Securities, (b) the principal of any Security which has become due otherwise then by such declaration of acceleration, and (c) to the extent the payment of such interest is lawful,

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interest on overdue installments of interest and overdue principal, which has become due otherwise than by such declaration of acceleration; (iii) the rescission would not conflict with any judgment or decree of a court of competent jurisdiction; and (iv) all payments due to the Trustee and any predecessor Trustee under Section 9.7 have been made. No such rescission shall affect any subsequent default or impair any right consequent thereon. Anything herein contained to the contrary notwithstanding, in the event of any acceleration pursuant to this Section 8.2, the Company shall not be obligated to pay any premium which it would have had to pay if it had then elected to redeem the Securities pursuant to paragraph 5 of the Securities, except in the case of any Event of Default occurring by reason of any willful action (or inaction) taken (or not taken) by or on behalf of the Company with the intention of avoiding payment of the premium which it would have had to pay if it had then elected to redeem the Securities pursuant to paragraph 5 of the form of Security attached hereto as Exhibit A, in which case an equivalent premium shall also become and be immediately due and payable to the extent permitted by law.

SECTION 8.3. OTHER REMEDIES.

        In case of an Event of Default hereunder, the Trustee may in its discretion proceed to protect and enforce the rights vested in it by this Indenture by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any of such rights, either by suit in equity or by action at law or by proceeding in bankruptcy or otherwise, whether for the specific enforcement of any covenant or agreement contained in this Indenture or in aid of the exercise of any power granted in this Indenture, or to enforce any other legal or equitable right vested in the Trustee by this Indenture or by law.

        The Trustee may maintain a proceeding even if it does not possess any of the Securities or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Securityholder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy is exclusive of any other remedy. All available remedies are cumulative to the extent permitted by law.

SECTION 8.4. WAIVER OF DEFAULTS AND EVENTS OF DEFAULT.

        Subject to Section 8.7, the Holders of a majority in principal amount of the Securities then outstanding by notice to the Trustee may waive an existing default or Event of Default and its consequences, except a default in the payment of the principal of (or premium, if any) or interest on any Security as specified in clauses (1) and (2) of Section 8.1, or a default in respect of a covenant or provision hereof which cannot be modified or amended pursuant to Section 11.2 without the consent of the Holder of each Security affected thereby. When a default or Event of Default is waived, it is cured and ceases.

SECTION 8.5. CONTROL BY MAJORITY.

        The Holders of a majority in principal amount of the Securities then outstanding may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on it. However, the Trustee may refuse to

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follow any direction that conflicts with law or this Indenture; provided that the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction.

SECTION 8.6. LIMITATION ON SUITS.

        A Securityholder may not pursue any remedy with respect to this Indenture or the Securities (except actions for payment of overdue principal or interest or for the conversion of the Securities pursuant to Article 4) unless:

        (1)  the Holder gives to the Trustee written notice of a continuing Event of Default;

        (2)  the Holders of at least 25% in principal amount of the then outstanding Securities make a written request to the Trustee to pursue the remedy;

        (3)  such Holder or Holders offer to the Trustee indemnity reasonably satisfactory to the Trustee against any loss, liability or expense;

        (4)  the Trustee does not comply with the request within 60 days after receipt of the request and the offer of indemnity; and

        (5)  no direction inconsistent with such written request has been given to the Trustee during such 60 day period by the Holders of a majority in principal amount of the Securities then outstanding.

        A Securityholder may not use any provision of this Indenture to prejudice the rights of another Securityholder or to obtain a preference or priority over such other Securityholder, or to enforce any rights under this Indenture other than in the manner herein provided and for the equal and ratable benefit of all the Securityholders.

SECTION 8.7. RIGHTS OF HOLDERS TO RECEIVE PAYMENT.

        Notwithstanding any other provision of this Indenture (but subject to Article 5), the right of any Holder of a Security to receive payment of principal of (and premium, if any) and interest on the Security, on or after the respective dates on which such payments are due as expressed in the Security, or to convert the Security, or to bring suit for the enforcement of any such payment on or after such respective dates, is absolute and unconditional and shall not be impaired or affected without the consent of the Holder.

SECTION 8.8. COLLECTION SUIT BY TRUSTEE.

        If an Event of Default in the payment of principal or interest specified in Section 8.1(1) or (2) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company or another obligor on the Securities for the whole amount of principal and accrued interest remaining unpaid, together with interest on overdue principal and, to the extent that payment of such interest is lawful, interest on overdue installments of interest, in each case at the rate per annum borne by the Securities and such further amount as shall be sufficient to cover the costs and expenses of collection, including the

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reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.

SECTION 8.9. TRUSTEE MAY FILE PROOFS OF CLAIM.

        The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Securityholders allowed in any judicial proceedings relative to the Company (or any other obligor on the Securities), its creditors or its property and shall be entitled and empowered to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same, and any Custodian in any such judicial proceeding is hereby authorized by each Securityholder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Securityholders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 9.7, and to the extent that such payment of the reasonable compensation, expenses, disbursements and advances in any such proceedings shall be denied for any reason, payment of the same shall be secured by a lien on, and shall be paid out of, any and all distributions, dividends, monies, securities and other property which the Securityholders may be entitled to receive in such proceedings, whether in liquidation or under any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or the Trustee to authorize or accept or adopt on behalf of any Securityholder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Securityholder in any such proceeding.

SECTION 8.10. PRIORITIES.

        Subject to Article 5, if the Trustee collects any money pursuant to this Article 8, it shall pay out the money in the following order:

        First, to the Trustee for amounts due under Section 9.7;

        Second, to Securityholders for amounts due and unpaid on the Securities for principal and interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Securities for principal and interest, respectively; and

        Third, to the Company.

        The Trustee may fix a record date and payment date for any payment to Securityholders pursuant to this Section 8.10. At least 15 days before such record date, the Trustee shall mail to each Securityholder and the Company a notice that states the Record Date, the Payment Date and the amount to be paid.

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SECTION 8.11. UNDERTAKING FOR COSTS.

        In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys' fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 8.11 does not apply to a suit made by the Trustee, a suit by a Holder pursuant to Section 8.7, or a suit by any Holder, or group of Holders, of more than 10% in principal amount of the Securities then outstanding. This Section 8.11 shall be in lieu of Section 315(c) of the TIA and such Section 315(c) is hereby expressly excluded from this Indenture as permitted by the TIA.

SECTION 8.12. RESTORATION OF RIGHTS AND REMEDIES.

        If the Trustee or any Securityholder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Securityholder, then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and the Securityholders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Securityholders shall continue as though no such proceeding had been instituted.

SECTION 8.13. RIGHTS AND REMEDIES CUMULATIVE.

        Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities in the last paragraph of Section 2.7, no right or remedy herein conferred upon or reserved to the Trustee or to the Securityholders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

SECTION 8.14. DELAY OR OMISSION NOT WAIVER.

        No delay or omission of the Trustee or of any Securityholder to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article or by law to the Trustee or to the Securityholders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Securityholders, as the case may be.

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ARTICLE 9.

TRUSTEE

SECTION 9.1. DUTIES OF TRUSTEE.

        (a)  If an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of his own affairs.

        (b)  Except during the continuance of an Event of Default:

        (1)  the Trustee need perform only those duties as are specifically set forth in this Indenture and no others and no implied covenants or obligations shall be read into this Indenture against the Trustee; and

        (2)  in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. The Trustee, however, shall examine the certificates and opinions to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).

        (c)  The Trustee may not be relieved, and no provision of this Indenture shall be construed to relieve the Trustee, from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:

        (1)  this paragraph does not limit the effect of paragraph (b) of this Section 9.1;

        (2)  the Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts;

        (3)  the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 8.5; and

        (4)  no provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

        (d)  The Trustee may refuse to perform any duty or exercise any right or power unless it receives indemnity reasonably satisfactory to it against any loss, liability, expense or fee.

        (e)  Every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 9.1.

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        (f)    The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.

SECTION 9.2. RIGHTS OF TRUSTEE.

        Subject to Section 9.1:

        (a)  The Trustee may conclusively rely on any document believed by it to be genuine and to have been signed or presented by the proper person. The Trustee need not investigate any fact or matter stated in the document.

        (b)  Whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, it may require an Officers' Certificate or an Opinion of Counsel, which shall conform to Section 12.4 (b). The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Certificate or Opinion.

        (c)  The Trustee may act through its agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care.

        (d)  The Trustee may consult with counsel of its selection and the advice or opinion of such counsel as to matters of law shall be full and complete authorization and protection in respect of any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.

        (e)  Any request or direction of the Company mentioned herein shall be sufficiently evidenced by a written Company request or Officers' Certificate and any resolution of the Board of Directors may be sufficiently evidenced by a Board Resolution.

        (f)    The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company, personally or by agent or attorney at the sole cost of the Company and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation.

        (g)  The Trustee shall not be liable for any action taken, suffered, or omitted to be taken by it in good faith and reasonably believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture.

        (h)  The Trustee shall not be deemed to have notice of any Default or Event of Default unless a Trust Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a default is received by the Trustee at the Corporate Trust Office of the Trustee, and such notice references the Securities and this Indenture.

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        (i)    The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and to each agent, custodian and other Person employed to act hereunder.

        (j)    The Trustee may request that the Company deliver an Officers' Certificate setting forth the names of individuals and/or titles of Officers of the Company authorized at such time to take specified actions pursuant to this Indenture, which Officers' Certificate may be signed by any person authorized to sign an Officers' Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded.

SECTION 9.3. INDIVIDUAL RIGHTS OF TRUSTEE.

        The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or an Affiliate of the Company with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights. However, the Trustee is subject to Sections 9.10 and 9.11.

SECTION 9.4. TRUSTEE'S DISCLAIMER.

        The Trustee makes no representation as to the validity or adequacy of this Indenture or the Securities, it shall not be accountable for the Company's use of the proceeds from the Securities, and it shall not be responsible for the recitals contained herein or any statement in the Securities other than its certificate of authentication.

SECTION 9.5. NOTICE OF DEFAULT OR EVENTS OF DEFAULT.

        If a default or an Event of Default occurs and is continuing and if it is actually known to the Trustee, the Trustee shall mail to each Securityholder notice of the default or Event of Default within 30 days after it occurs. Except in the case of a default or an Event of Default in payment of the principal of or interest on any Security, the Trustee may withhold the notice if and so long as a committee of its Trust Officers in good faith determines that withholding the notice is in the interest of Securityholders.

SECTION 9.6. REPORTS BY TRUSTEE TO HOLDERS.

        If such report is required by TIA 313, within 60 days after each May 15, beginning with the May 15 following the date of this Indenture, the Trustee shall mail to each Securityholder a brief report dated as of such May 15 that complies with TIA 313(a). The Trustee also shall comply with TIA 313(b)(2) and (c).

        A copy of each report at the time of its mailing to Securityholders shall be mailed to the Company and filed with the SEC and each stock exchange, if any, on which the Securities are listed. The Company shall notify the Trustee whenever the Securities become listed on or delisted from any stock exchange and any changes in the stock exchanges on which the Securities are listed.

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SECTION 9.7. COMPENSATION AND INDEMNITY.

        The Company shall pay to the Trustee from time to time such compensation for its services hereunder as the Company and the Trustee shall from time to time agree in writing (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust). The Company shall reimburse the Trustee upon request for all reasonable disbursements, expenses and advances incurred or made by it. Such expenses may include the reasonable compensation, disbursements and expenses of Trustee's agents and counsel.

        The Company shall indemnify the Trustee or any predecessor Trustee and their agents for, and hold them harmless against, any loss, liability or expense incurred by it in connection with its duties under this Indenture or any action or failure to act as authorized or within the discretion or rights or powers conferred upon the Trustee hereunder, including the costs and expenses of defending itself against any claim (whether asserted by the Company, or any Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties hereunder. The Trustee shall notify the Company promptly of any claim asserted against the Trustee for which it may seek indemnity. The Trustee shall have the option of undertaking the defense of such claims at the Company's expense and may have separate counsel. The reasonable fees and expenses of such counsel shall be paid by the Company. The Company need not pay for any settlement without its written consent, which consent shall not be unreasonably withheld or delayed.

        The Company need not reimburse the Trustee for any expense or indemnify it against any loss or liability incurred by it through its own negligent action, negligent failure to act or willful misconduct.

        When the Trustee incurs expenses or renders services after an Event of Default specified in Section 8.1(6) or (7) occurs, such expenses and the compensation for such services are intended to constitute expenses of administration under any Bankruptcy Law.

        The Trustee shall have a lien prior to the Securities as to all property and funds held by it hereunder for any amount owing it or any predecessor Trustee pursuant to this Section 9.7, except with respect to funds held in trust for the benefit of the Holders of particular Securities.

        The provisions of this Section 9.7 shall survive the termination of this Indenture.

SECTION 9.8. REPLACEMENT OF TRUSTEE.

        The Trustee may resign by so notifying the Company; provided, however, no such resignation shall be effective until a successor Trustee has accepted its appointment pursuant to this Section 9.8. The Holders of a majority in principal amount of the Securities then outstanding may remove the Trustee by so notifying the Trustee and may appoint a successor Trustee with the Company's written consent. The Company may remove the Trustee if:

        (1)  the Trustee fails to comply with Section 9.10;

        (2)  the Trustee is adjudged a bankrupt or an insolvent;

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        (3)  a receiver or other public officer takes charge of the Trustee or its property; or

        (4)  the Trustee becomes incapable of acting as trustee.

        If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall promptly appoint a successor Trustee.

        If a successor Trustee does not take office within 30 days after the retiring Trustee resigns or is removed, the retiring Trustee (at the Company's expense), the Company or the Holders of 10% in principal amount of the Securities then outstanding may petition any court of competent jurisdiction for the appointment of a successor Trustee.

        If the Trustee fails to comply with Section 9.10, any Securityholder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

        A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Immediately after that, the retiring Trustee shall transfer all property held by it as Trustee to the successor Trustee and be released from its obligations (exclusive of any liabilities Trustee may have incurred while acting as Trustee) hereunder, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. A successor Trustee shall mail notice of its succession to each Securityholder.

        Notwithstanding replacement of the Trustee pursuant to this Section 9.8, the Company's obligations under Section 9.7 shall continue for the benefit of the retiring Trustee.

SECTION 9.9. SUCCESSOR TRUSTEE BY MERGER, ETC.

        If the Trustee consolidates with, merges or converts into, or transfers all or substantially all of its corporate trust assets (including the administration of this Indenture) to, another corporation, the resulting, surviving or transferee corporation without any further act shall be the successor Trustee; provided such transferee corporation shall qualify and be eligible under Section 9.10.

SECTION 9.10. ELIGIBILITY; DISQUALIFICATION.

        There shall at all times be a Trustee hereunder which shall be a corporation organized and doing business under the laws of the United States of America, any State thereof or the District of Columbia, authorized under such laws to exercise corporate trust process, having (together with any Person directly or indirectly controlling the Trustee) a combined capital and surplus of at least $25,000,000, subject to supervision or examination by federal or state authority. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of said supervising or examining authority, then for the purposes of this Section 9.10, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section 9.10, it shall resign immediately in the manner and with the effect specified above in this Article 9.

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SECTION 9.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.

        The Trustee shall comply with TIA 311(a), excluding any creditor relationship listed in TIA 311(b). A trustee who has resigned or been removed shall be subject to TIA 311(a) to the Government Obligations in accordance with Section 10.1; provided, however, that if the Company has made any payment of the principal of or premium, if any, or interest on any Securities because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive any such payment from the money or U.S. Government Obligations held by the Trustee or the Paying Agent.

ARTICLE 10.

SATISFACTION AND DISCHARGE OF INDENTURE

SECTION 10.1. TERMINATION OF COMPANY'S OBLIGATIONS.

        The Company may terminate all of its obligations under the Securities and this Indenture (except those obligations referred to in the immediately succeeding paragraph) if all Securities previously authenticated and delivered (other than destroyed, lost or stolen Securities which have been replaced or paid or Securities for whose payment money has theretofore been held in trust and thereafter repaid to the Company, as provided in Section 10.3) have been delivered to the Trustee for cancellation and the Company has paid all sums payable by it hereunder, or if the Company irrevocably deposits in trust with the Trustee money or U.S. Government Obligations maturing as to principal and interest in such amounts and at such times as are sufficient, without consideration of any reinvestment of such interest, to pay the principal of and premium, if any, and interest on the Securities then outstanding to maturity or to the date fixed for redemption and to pay all other sums payable by it hereunder. The Company may make an irrevocable deposit pursuant to this Section 10.1 only if at such time it is not prohibited from doing so under the provisions of Article 5 and the Company shall have delivered to the Trustee and any such Paying Agent an Officers' Certificate and Opinion of Counsel to that effect and that all other conditions to such deposit have been complied with.

        The Company's obligations in paragraphs 8 and 12 of the Securities, in Sections 6.1, 6.2, 9.7, 9.8 and 10.4, and in Articles 2 and 4 shall survive until the Securities are no longer outstanding. Thereafter, the Company's obligations in such paragraph 12 and in Section 9.7 shall survive.

        After such irrevocable deposit, the Trustee upon request shall acknowledge in writing the discharge of the Company's obligations under the Securities and this Indenture, except for those surviving obligations specified above.

        "U.S. Government Obligations" means direct non-callable obligations of, or non-callable obligations guaranteed by, the United States of America for the payment of which guarantee or obligation the full faith and credit of the United States is pledged.

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SECTION 10.2. APPLICATION OF TRUST MONEY.

        The Trustee or the Paying Agent shall hold in trust, for the benefit of the Holders, money or U.S. Government Obligations deposited with it pursuant to Section 10.1, and shall apply the deposited money and the money from U.S. Government Obligations in accordance with this Indenture to the payment of the principal of, premium, if any, and interest on the Securities. Money and U.S. Government Obligations so held in trust and deposited in compliance with Section 10.1 and Article 5 shall not be subject to the subordination provisions of Article 5.

        The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the U.S. Government Obligations deposited pursuant to Section 10.1 or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of outstanding Securities.

SECTION 10.3. REPAYMENT TO COMPANY.

        Subject to Section 10.1, the Trustee and the Paying Agent shall promptly pay to the Company upon request any excess money or U.S. Government Obligations held by them at any time.

        The Trustee and the Paying Agent shall pay, subject to applicable escheatment laws, to the Company upon request any money held by them for the payment of principal, premium, if any, or interest that remains unclaimed for two years after a right to such money has matured. After that, Holders entitled to money must look to the Company for payment unless an abandoned property law designates another person.

SECTION 10.4. REINSTATEMENT.

        If the Trustee or the Paying Agent is unable to apply any money or U.S. Government Obligations in accordance with Section 10.1 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company's obligations under this Indenture and the Securities shall be revived and reinstated as though no deposit had occurred pursuant to Section 10.1 until such time as the Trustee or Paying Agent is permitted to apply all such money or U.S. Government Obligations in accordance with Section 10.1; provided, however, that if the Company has made any payment of the principal of or premium or interest on any Securities because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive any such payment from the money or U.S. Government Obligations held by the Trustee or the Paying Agent.

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ARTICLE 11.

AMENDMENTS, SUPPLEMENTS AND WAIVERS

SECTION 11.1. WITHOUT CONSENT OF HOLDERS.

        The Company and the Trustee may amend or supplement this Indenture or the Securities without notice to or consent of any Securityholder: (a) to comply with Sections 4.12, 6.3 and 7.1;

        (a)  to cure any ambiguity, omission, defect or inconsistency, or to make any other change that does not adversely affect the rights of any Securityholder;

        (b)  to make provisions with respect to the conversion right of the Holders pursuant to Section 4.6;

        (c)  to evidence and provide for the acceptance of appointment hereunder by a successor to the Company with respect to the Securities; or

        (d)  to comply with any requirement of the SEC arising solely as a result of the qualification of this Indenture under the TIA.

SECTION 11.2. WITH CONSENT OF HOLDERS.

        The Company and the Trustee may amend or supplement this Indenture or the Securities without notice to any Securityholder but with the written consent of the Holders of a majority in aggregate principal amount of the Securities then outstanding. The Holders of a majority in aggregate principal amount of the Securities then outstanding may waive compliance by the Company with restrictive provisions of this Indenture other than as set forth in this Section 11.2 below; and waive any past default under this Indenture and its consequences, except a default in the payment of the principal of or any premium or interest on any Security or in respect of a provision which under this Indenture cannot be modified or amended without the consent of the Holder of each outstanding Security affected.

        Subject to Section 11.4, without the written consent of each Securityholder affected, however, an amendment, supplement or waiver, including a waiver pursuant to Section 8.4, may not:

        (a)  change the stated maturity date of the principal of, or any installment of interest on, any Security;

        (b)  reduce the principal amount of, or the rate of interest on, or any premium payable on, any Security, whether upon acceleration, redemption or otherwise;

        (c)  change the currency for payment of principal of, or premium or interest (including Liquidated Damages) on any Security;

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        (d)  impair the right to institute suit for the enforcement of any payment of principal of, or premium or interest on any Security when due;

        (e)  adversely affect the conversion rights provided in Article 4;

        (f)    change the number of shares of Common Stock issuable upon conversion of a Security in a manner adverse to the Holders of Securities other than as expressly provided in Article 4;

        (g)  change the redemption provisions of this Indenture in a manner adverse to the Holders of Securities;

        (h)  modify the provisions of Article 5 with respect to the subordination of the Securities in a manner adverse to the Holders of the Securities;

        (i)    modify the provisions of this Indenture requiring the Company to make an offer to repurchase Securities upon a Change of Control in a manner adverse to the Holders of the Securities;

        (j)    reduce the percentage of principal amount of the outstanding Securities necessary to modify or amend this Indenture or to consent to any waiver provided for in this Indenture; or

        (k)  waive a default in the payment of the principal of or premium or interest (including Liquidated Damages) on any Security.

        It shall not be necessary for the consent of the Holders under this Section 11.2 to approve the particular form of any proposed amendment, supplement or waiver, but it shall be sufficient if such consent approves the substance thereof.

        An amendment under this Section 11.2 may not make any change that adversely affects the rights under Article 5 of any holder of an issue of Senior Indebtedness unless the holders of that issue, pursuant to its terms, consent to the change.

SECTION 11.3. COMPLIANCE WITH TRUST INDENTURE ACT.

        Every amendment to or supplement of this Indenture or the Securities shall comply with TIA as in effect at the date of such amendment or supplement.

SECTION 11.4. REVOCATION AND EFFECT OF CONSENTS.

        Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder is a continuing consent by the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder's Security, even if notation of the consent is not made on any Security. However, any such Holder or subsequent Holder may revoke the consent as to his Security or portion of a Security if the Trustee receives the notice of revocation before the date the amendment, supplement or waiver becomes effective.

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        After an amendment, supplement or waiver becomes effective, it shall bind every Securityholder, unless it makes a change described in any of clauses (a) through (k) of Section 11.2. In that case the amendment, supplement or waiver shall bind each Holder of a Security who has consented to it and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder's Security.

SECTION 11.5. NOTATION ON OR EXCHANGE OF SECURITIES.

        If an amendment, supplement or waiver changes the terms of a Security, the Trustee may require the Holder of the Security to deliver it to the Trustee. The Trustee may place an appropriate notation on the Security about the changed terms and return it to the Holder. Alternatively, if the Company or the Trustees determines, the Company in exchange for the Security shall issue and the Trustee shall authenticate a new Security that reflects the changed terms.

SECTION 11.6. TRUSTEE TO SIGN AMENDMENTS, ETC.; NOTICES.

        The Trustee shall sign any amendment or supplement authorized pursuant to this Article 11 if the amendment or supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee. If it does, the Trustee may but need not sign it. In signing or refusing to sign such amendment or supplement, the Trustee shall be entitled to receive and, subject to Section 9.1, shall be fully protected in relying upon, an Opinion of Counsel stating that such amendment or supplement is authorized or permitted by this Indenture. The Company may not sign an amendment or supplement until the Board of Directors approves it.

        After an amendment, supplement or waiver under this Article 11 becomes effective, the Company shall mail to the Holders affected thereby a notice briefly describing the amendment, supplement or waiver. Any failure of the Company to mail such notice, or any defect therein, shall not, however, in anyway impair or affect the validity of any such amendment, supplement or waiver.

ARTICLE 12.

MISCELLANEOUS

SECTION 12.1. TRUST INDENTURE ACT CONTROLS.

        If any provision of this Indenture limits, qualifies or conflicts with the duties imposed by any of Sections 310 to 317, inclusive, of the TIA through operation of Section 318(c) thereof, upon qualification of this Indenture hereunder such imposed duties shall control.

SECTION 12.2. NOTICES.

        Any notice or communication shall be given in writing and delivered by facsimile (with original to follow), in person, by overnight delivery or mailed by first class mail, postage prepaid, addressed as follows:

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	If to the Company:
	GenCorp Inc. P.O. Box 537012 Sacramento, California 95853-7012 Attention: Terry L. Hall Facsimile: 916-351-8668
with a copy to:
	Jones, Day, Reavis & Pogue North Point 901 Lakeside Avenue Cleveland, Ohio 44114 Attention: Christopher Kelly
	Facsimile: 216-579-0212
	If to the Trustee:
	The Bank of New York 101 Barclay Street New York, New York 10286 Facsimile: 212-896-7299 Attention: Corporate Trust Administration

        Such notices or communications shall be effective when received.

        The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notice or communications.

        Any notice or communication mailed to a Securityholder shall be mailed by first class mail to such Securityholder at its address shown on the register kept by the Registrar.

        Failure to mail a notice or communication to a Securityholder or any defect in it shall not affect its sufficiency with respect to other Securityholders. If a notice or communication to a Securityholder is mailed in the manner provided above, it is duly given, whether or not the addressee receives it.

SECTION 12.3. COMMUNICATIONS BY HOLDERS WITH OTHER HOLDERS.

        Securityholders may communicate pursuant to TIA 312(b) with other Securityholders with respect to their rights under this Indenture or the Securities. The Company, the Trustee, the Registrar and any other person shall have the protection of TIA 312(c).

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SECTION 12.4. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.

        (a) Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company shall furnish to the Trustee at the request of the Trustee:

(1)

an Officers' Certificate stating that, in the opinion of the signers, all conditions precedent (including any covenants compliance with which constitutes a condition precedent), if any, provided for in this Indenture relating to the proposed action have been complied with; and



(2)

an Opinion of Counsel stating that, in the opinion of such counsel, all such conditions precedent (including any covenants compliance with which constitutes a condition precedent) have been complied with.

        (b) Each Officers' Certificate and Opinion of Counsel with respect to compliance with a condition or covenant provided for in this Indenture (other than annual certificates provided pursuant to Section 6.4) shall include:

(1)

a statement that the person making such certificate or opinion has read such covenant or condition;



(2)

a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;



(3)

a statement that, in the opinion of such person, he has made such examination or investigation as is necessary to enable him to express uninformed opinion as to whether or not such covenant or condition has been complied with; and



(4)

a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with; provided, however, that with respect to matters of fact an Opinion of Counsel may rely on Officers' Certificates or certificates of public officials.

SECTION 12.5. RECORD DATE FOR VOTE OR CONSENT OF SECURITYHOLDERS.

        The Company (or, in the event deposits have been made pursuant to Section 6.3 or 10.1, the Trustee) may set a record date for purposes of determining the identity of Securityholders entitled to vote or consent to any action by vote or consent authorized or permitted under this Indenture, which record date shall be the later of 10 days prior to the first solicitation of such vote or consent or the date of the most recent list of Securityholders furnished to the Trustee pursuant to Section 2.5 prior to such solicitation. If a record date is fixed, those persons who were Holders of Securities at such record date (or their duly designated proxies), and only those persons, shall be entitled to take such action by vote or consent or to revoke any vote or consent previously given, whether or not such persons continue to be Holders after such record date.

SECTION 12.6. RULES BY TRUSTEE, PAYING AGENT, REGISTRAR.

        The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or the Paying Agent may make reasonable rules for its functions.

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SECTION 12.7. LEGAL HOLIDAYS.

        A "Legal Holiday" is a Saturday, or a Sunday or a day on which state or federally chartered banking institutions in New York (or, if the Trustee is not located in New York, the state where the Trust Office of the Trustee is located) are not required to be open. If a payment date is a Legal Holiday at a place of payment, payment may be made at that place on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period.

SECTION 12.8. GOVERNING LAW.

        The laws of the State of New York shall govern this Indenture and the Securities without regard to principles of conflicts of law.

SECTION 12.9. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.

        This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary. Any such indenture, loan or debt agreement may not be used to interpret this Indenture.

SECTION 12.10. NO RECOURSE AGAINST OTHERS.

        All liability described in paragraph 17 of the Securities of any director, officer, employee or stockholder, as such, of the Company is waived and released.

SECTION 12.11. SUCCESSORS.

        All agreements of the Company in this Indenture and the Securities shall bind its successor. All agreements of the Trustee in this Indenture shall bind its successor.

SECTION 12.12. MULTIPLE COUNTERPARTS.

        The parties may sign multiple counterparts of this Indenture. Each signed counterpart shall be deemed an original, but all of them together represent the same agreement.

SECTION 12.13. SEPARABILITY.

        In case any provision in this Indenture or in the Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

SECTION 12.14. TABLE OF CONTENTS, HEADINGS, ETC.

        The table of contents, cross-reference sheet and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part hereof, and shall in no way modify or restrict any of the terms or provisions hereof.

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        IN WITNESS WHEREOF, the parties hereto have hereunto set their hands as of the 5th day of April, 2002.

GENCORP INC.
By:	/s/  YASMIN R. SEYAL Name: Yasmin R. Seyal Title: Senior Vice Presient, Financing;          Treasurer, and acting Chief          Financial Officer
THE BANK OF NEW YORK         as Trustee
By:	/s/  MICHAEL PITFICK Name: Michael Pitfick Title: Assistant Vice President

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EXHIBIT A

FORM OF SECURITY

[GLOBAL NOTE LEGEND:

        UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO GENCORP INC. (THE "COMPANY") OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

        TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFER IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.]

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[RESTRICTED SECURITIES LEGEND:

        THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, AGREES FOR THE BENEFIT OF GENCORP INC. (THE "COMPANY") THAT THIS SECURITY MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD UNDER RULE 144(k) (OR ANY SUCCESSOR THERETO) UNDER THE SECURITIES ACT WHICH IS APPLICABLE TO THIS SECURITY OR (Y) BY ANY HOLDER THAT WAS AN "AFFILIATE" (WITHIN THE MEANING OF RULE 144 UNDER THE SECURITIES ACT) OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE OF SUCH TRANSFER, IN EITHER CASE, OTHER THAN (1) TO THE COMPANY, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (3) IN AN OFFSHORE TRANSACTION (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT) IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT, (4) TO AN INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1), (2), (3), OR (7) OF REGULATION D UNDER THE SECURITIES ACT ("INSTITUTIONAL ACCREDITED INVESTOR") THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION, AND THAT, PRIOR TO SUCH TRANSFER, DELIVERS TO THE COMPANY AND THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH LETTER MAY BE OBTAINED FROM THE TRUSTEE), (5) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT OR (6) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. PRIOR TO A TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER PURSUANT TO CLAUSE (6) ABOVE), THE HOLDER OF THIS SECURITY MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY AND THE TRUSTEE SUCH CERTIFICATES AND OTHER INFORMATION AND, IN THE CASE OF A TRANSFER PURSUANT TO CLAUSE (5) ABOVE, A LEGAL OPINION AS THEY MAY REASONABLY REQUIRE TO CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE FOREGOING RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER OR (2) AN INSTITUTIONAL ACCREDITED INVESTOR THAT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION OR (3) NOT A U.S. PERSON AND IS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING THE

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REQUIREMENTS OF PARAGRAPH (k)(2) OF RULE 902 UNDER) REGULATION S UNDER THE SECURITIES ACT. IN ANY CASE, THE HOLDER HEREOF WILL NOT, DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO THIS SECURITY OR ANY COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY EXCEPT AS PERMITTED BY THE SECURITIES ACT.]

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[FORM OF FACE OF SECURITY]

GENCORP INC.

Number [ISIN No. US368682AD27]
CUSIP No. 368682 AD 2

5³/4% Convertible Subordinated Note Due 2007

        GenCorp Inc., an Ohio corporation (the "Company"), promises to pay to Cede & Co. or registered assigns, the principal sum of                         ($                        ) on April 15, 2007 and to pay interest on the principal amount of this Note beginning on the most recent date to which interest has been paid or, if no interest has been paid, beginning on October 15, 2002 at the rate of 5³/4% per annum.

Interest Payment Dates:	April 15 and October 15
Record Dates:	March 31 and September 30

        This Note is convertible at such times and as specified on the other side of this Note. Additional provisions of this Note are set forth on the other side of this Note.

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        IN WITNESS WHEREOF, the Company has caused this 5³/4% Convertible Subordinated Notes due 2007 to be signed by its duly authorized officers.

Dated:	GENCORP INC.
	By:	Name: Title:
	By:	Name: Title:

Trustee's Certificate of
Authentication:

Dated:                                      

This is one of the Securities
referred to in the within mentioned
Indenture.

THE BANK OF NEW YORK,
    as Trustee

By:                                                                   
        Authorized Signatory

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[FORM OF REVERSE SIDE OF SECURITY]

GENCORP INC.

5³/4% Convertible Subordinated Note Due 2007

1.

Interest.

        GenCorp Inc., an Ohio corporation (the "Company"), promises to pay interest on the principal amount of this Note at the rate per annum shown above. The Company shall pay interest semi-annually on April 15 and October 15 of each year, commencing October 15, 2002. Interest on the Notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from April 5, 2002. Interest will be computed on the basis of a 360-day year of twelve 30-day months.

        The Holder of this Note is entitled to the benefits of the Registration Rights Agreement, dated as of April 5, 2002, among the Company, Deutsche Bank Securities Inc. ("DBSI"), Banc One Capital Markets, Inc. and ABN AMRO Rothschild LLC.

2.

Method of Payment.

        The Company will pay interest on this Note (except defaulted interest) to the person who is the registered Holder of this Note at the close of business on the March 31 and September 30 immediately preceding the interest payment date, or if such day is not a Business Day, on the next succeeding Business Day. The Holder must surrender this Note to the Paying Agent to collect payment of principal. The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts. The Company, however, may pay principal and interest by its check payable in such money. It may mail an interest check to the Holder's registered address.

3.

Paying Agent, Registrar and Conversion Agent.

        Initially, The Bank of New York (the "Trustee") will act as Paying Agent, Registrar and Conversion Agent. The Company may change any Paying Agent, Registrar or Conversion Agent without notice to the holder. The Company or any of its Subsidiaries may act as Paying Agent, Registrar or Conversion Agent.

4.

Indenture; Limitations.

        This Note is one of a duly authorized issue of Notes of the Company designated as its 5³/4% Convertible Subordinated Notes Due 2007 (the "Notes"), issued under an Indenture dated as of April 5, 2002 (the "Indenture"), between the Company and the Trustee. The terms of this Note include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb), as amended by the Trust Indenture Reform Act of 1990, as in effect on the date hereof or, from and after the date that the Indenture shall be qualified thereunder, as in effect on such date. This Note is subject to all such terms, and the holder of this Note is referred to the Indenture and said Act for a statement of them.

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        The Notes are subordinated unsecured obligations of the Company limited to up to $125,000,000 aggregate principal amount plus an additional principal amount not exceeding $25,000,000 in the aggregate as may be issued upon the exercise by DBSI, in whole or in part, of the Purchase Option.

5.

Optional Redemption.

        The Notes may be redeemed at the Company's option, in whole or in part, at any time and from time to time on and after April 22, 2005 (an "Optional Redemption") if the trading price of the Company's Common Stock for 20 Trading Days (as defined in the Indenture) in a period of 30 consecutive Trading Days ending on the Trading Day prior to the date of mailing of the notice of redemption exceeds 125% of the Conversion Price (as defined below) of the Notes. The redemption price for the Notes, expressed as a percentage of the principal amount, is as follows for the 12-month periods set forth below:

Redemption Period	Percentage
April 22, 2005 through April 14, 2006	101.00	%
April 15, 2006 through April 14, 2007	100.50	%

together in the case of any such redemption with accrued and unpaid interest to the date of redemption, but any interest payment that is due and payable on or prior to such date of redemption will be payable to the Holders of such Notes, or one or more predecessor Notes, of record at the close of business on the relevant record dates referred to on the face hereof, all as provided in the Indenture.

6.

Notice of Redemption.

        Notice of redemption will be mailed by first class mail at least 30 days but no more than 60 days prior to the redemption date in the case of a Optional Redemption, and at least 20 days but not more than 60 days before the redemption date in the case of an Optional Redemption, to each Holder of Notes to be redeemed at his registered address. Notes in denominations larger than $1,000 may be redeemed in part, but only in whole multiples of $1,000. On and after the redemption date, subject to the deposit with the Paying Agent of funds sufficient to pay the redemption price, interest ceases to accrue on Notes or portions of them called for redemption.

7.

Repurchase of Notes at Option of Holder upon a Change of Control.

        If at any time that Notes remain outstanding there shall have occurred a Change of Control (as defined in the Indenture), at the option of the Holder and subject to the terms and conditions of the Indenture, the Company shall become obligated to repurchase all or any part specified by the Holder (so long as the principal amount of such part is $1,000 or an integral multiple thereof) of the Notes held by such Holder on the Repurchase Date. The Holder shall have the right to withdraw any Repurchase Notice by delivering a written notice of withdrawal to

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the Paying Agent in accordance with the terms of the Indenture. The Repurchase Price is payable in cash.

8.

Conversion.

        At any time after 90 days following the last date of original issuance of the Notes and prior to the close of business on the Business Day immediately preceding April 15, 2007, a Holder of a Note may convert such Note into shares of Common Stock of the Company; provided, however, that if the Note is called for redemption, the conversion right will terminate at the close of business on the Business Day before the redemption date of such Note (unless the Company shall default in making the redemption payment when due, in which case the conversion right shall terminate at the close of business on the date such default is cured and such Note is redeemed). The initial conversion price is $18.42 per share, subject to adjustment under certain circumstances as described in the Indenture (the "Conversion Price"). The number of shares issuable upon conversion of a Note is determined by dividing the principal amount converted by the Conversion Price in effect on the conversion date. Upon conversion, no adjustment for interest or dividends will be made. No fractional shares will be issued upon conversion; in lieu thereof, an amount will be paid in cash based upon the current market price (as defined in the Indenture) of the Common Stock on the last trading day prior to the date of conversion.

        To convert a Note, a Holder must (a) complete and sign the conversion notice set forth below and deliver such notice to the Conversion Agent, (b) surrender the Note to the Conversion Agent, (c) furnish appropriate endorsements and transfer documents if required by the Registrar or the Conversion Agent, (d) pay any transfer or similar tax, if required and (e) if the Note is held in book-entry form, complete and deliver to the Depositary appropriate instructions pursuant to the Depositary's book-entry conversion programs. If a Holder surrenders a Note for conversion between the record date for the payment of an installment of interest and the next interest payment date, the Note must be accompanied by payment of an amount equal to the interest payable on such interest payment date on the principal amount of the Note or portion thereof then converted; provided, however, that no such payment shall be required if such Note has been called for redemption on a redemption date within the period between and including such record date and such interest payment date. A Holder may convert a portion of a Note equal to $1,000 or any integral multiple thereof.

        A Note in respect of which a Holder had delivered a Repurchase Notice exercising the option of such Holder to require the Company to repurchase such Note may be converted only if the notice of exercise is withdrawn as provided above and in accordance with the terms of the Indenture.

9.

Subordination.

        The indebtedness evidenced by the Notes is, to the extent and in the manner provided in the Indenture, subordinate and junior in right of payment to the prior payment in full of all Senior Indebtedness of the Company, as defined in the Indenture. Any Holder by accepting this Note agrees to and shall be bound by such subordination provisions and authorizes the Trustee to give them effect.

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        In addition to all other rights of Senior Indebtedness described in the Indenture, the Senior Indebtedness shall continue to be Senior Indebtedness and entitled to the benefits of the subordination provisions irrespective of any amendment, modification or waiver of any terms of any instrument relating to the Senior Indebtedness or any extension or renewal of the Senior Indebtedness.

10.

Denominations, Transfer, Exchange.

        The Notes are in registered form without coupons in denominations of $1,000 and integral multiples thereof. A Holder may register the transfer of or exchange Notes in accordance with the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes or other governmental charges that may be imposed by law or permitted by the Indenture.

        The aggregate principal amount of the Note in global form represented hereby may from time to time be reduced to reflect conversions or redemptions of a part of this Note in global form or cancellations of apart of this Note in global form, in each case, and in any such case, by means of notations on the Global Note Transfer Schedule on the last page hereof. Notwithstanding any provision of this Note to the contrary, conversions or redemptions of a part of this Note in global form and cancellations of a part of this Note in global form, may be effected without the surrendering of this Note in global form, provided that appropriate notations on the Schedule of Exchanges, Conversions, Redemptions, Cancellations and Transfers are made by the Trustee, or the Custodian at the direction of the Trustee, to reflect the appropriate reduction or increase, as the case may be, in the aggregate principal amount of this Note in a global form resulting therefrom or as a consequence thereof.

11.

Persons Deemed Owners.

        The registered holder of a Note may be treated as the owner of it for all purposes.

12.

Unclaimed Money.

        If money for the payment of principal, premium, if any, or interest remains unclaimed for two years, the Trustee or Paying Agent will pay, subject to applicable escheatment laws, the money back to the Company at its request. After that, Holders entitled to money must look to the Company for payment unless an abandoned property law designates another person.

13.

Amendment, Supplement, Waiver.

        Subject to certain exceptions, the Indenture or the Notes may be amended or supplemented with the consent of the Holders of a majority in aggregate principal amount of the Notes then outstanding and any past default or compliance with any provision may be waived in a particular instance with the consent of the Holders of a majority in aggregate principal amount of the Notes then outstanding. Without the consent of or notice to any Holder, the Company and the Trustee may amend or supplement the Indenture or the Notes to, among other things, cure any ambiguity, omission, defect or inconsistency or make any other change that does not adversely affect the rights of any Holder.

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14.

Successor Corporation.

        When a successor corporation assumes all the obligations of its predecessor under the Notes and the Indenture, the predecessor corporation will be released from those obligations.

15.

Defaults and Remedies.

        An Event of Default is: default for 30 days in payment of interest on the Notes; default in payment of principal on the Notes when due; failure by the Company for 60 days after appropriate notice to it to comply with any of its other agreements contained in the Indenture or the Notes; default by the Company or any Subsidiary with respect to its obligation to pay principal of or interest on indebtedness for borrowed money aggregating more than $10 million or the acceleration of such indebtedness if not withdrawn within 30 days from the date of such acceleration; failure by the Company to deliver shares of Common Stock within 15 days after such Common Stock is required to be delivered upon conversion of a Note; and certain events of bankruptcy, insolvency or reorganization of the Company or any of its Significant Subsidiaries. If an Event of Default (other than as a result of certain events of bankruptcy, insolvency or reorganization) occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the Notes then outstanding may declare all unpaid principal of and accrued interest to the date of acceleration on the Notes then outstanding to be immediately due and payable, all as and to the extent provided in the Indenture. If an Event of Default occurs as a result of certain events of bankruptcy, insolvency or reorganization, all unpaid principal of and accrued interest on the Notes then outstanding shall become immediately due and payable without any declaration or other act on the part of the Trustee or any Holder, all as and to the extent provided in the Indenture. Holders may not enforce the Indenture or the Notes except as provided in the Indenture. The Trustee may require indemnity satisfactory to it before it enforces the Indenture or the Notes. Subject to certain limitations, Holders of a majority in principal amount of the Notes then outstanding may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders notice of any continuing default (except a default in payment of principal or interest) if it determines that withholding notice is in their interests. The Company is required to file periodic reports with the Trustee alto the absence of default.

16.

Trustee Dealings with the Company.

        The Bank of New York, the Trustee under the Indenture, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Company or an Affiliate of the Company, and may otherwise deal with the Company or an Affiliate of the Company, as if it were not the Trustee.

17.

No Recourse Against Others.

        A director, officer, employee or stockholder, as such, of the Company shall not have any liability for any obligations of the Company under the Notes or the Indenture or for any claim based on, in respect or by reason of, such obligations or their creation. The Holder of this Note by accepting this Note waives and releases all such liability. The waiver and release are part of the consideration for the issue of this Note.

18.

Discharge Prior to Maturity.

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        If the Company deposits with the Trustee or the Paying Agent money or U.S. Government Obligations sufficient to pay the principal of and interest on the Notes to maturity as provided in the Indenture, the Company will be discharged from the Indenture except for certain Sections thereof.

19.

Authentication.

        This Note shall not be valid until the Trustee or an authenticating agent signs the certificate of authentication on the other side of this Note.

20.

Abbreviations and Definitions.

        Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian) and U/G/M/A (= Uniform Gifts to Minors Act).

        All capitalized terms used in this Note and not specifically defined herein are defined in the Indenture and are used herein as so defined.

21.

Indenture to Control.

        In the case of any conflict between the provisions of this Note and the Indenture, the provisions of the Indenture shall control.

        The Company will furnish to any Holder, upon written request and without charge, a copy of the Indenture. Requests may be made to: GenCorp Inc., P.O. Box 537012, Sacramento, California 95853-7012.

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TRANSFER NOTICE

        This Transfer Notice relates to $                   principal amount of the 5³/4% Convertible Subordinated Notes Due 2007 of GenCorp Inc., an Ohio corporation, held by                                                   (the "Transferor").

(I) or (we) assign and transfer this Convertible Note to

(Print or type assignee's name, address and zip code)

(Insert assignee's social security or tax I.D. no.)

and irrevocably appoint                                                   agent to transfer this Note on the books of the Company. The agent may substitute another to act for him.

Your Signature:                                                  
(Sign exactly as your name appears on the other side of this convertible Note)

Date:                         

Signature Guarantee(1)                                     

        In connection with any transfer of any of the Notes evidenced by this certificate occurring prior to the date that is three years after the later of the date of original issuance of such Notes and the last date, if any, on which such Notes were owned by the Company or any Affiliate of the Company, the undersigned confirms that such Notes are being transferred:

CHECK ONE BOX BELOW

(1)

[  ] to GenCorp Inc.; or

(2)

[  ] pursuant to and in compliance with Rule 144A under the Securities Act of 1933, as amended; or

(3)

[  ] pursuant to and in compliance with Regulation S under the Securities Act of 1933, as amended; or

(4)

[  ] pursuant to another available exemption from the registration requirements of the Securities Act of 1933, as amended; or

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(5)

[  ] pursuant to an effective registration statement under the Securities Act of 1933.

Unless one of the boxes is checked, the Trustee will refuse to register any of the Notes evidenced by this certificate in the name of any person other than the registered holder thereof; provided, however, that if box (2), (3) or (4) is checked, the Trustee may require, prior to registering any such transfer of the Notes such legal opinions, certifications and other information as the Company has reasonably requested to confirm that such transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933, as amended, such as the exemption provided by Rule 144 under such Act.

Unless the box below is checked, the undersigned confirms that such Note is not being transferred to an "affiliate" of the Company as defined in Rule 144 under the Securities Act of 1933, as amended (an "Affiliate"):

[  ] The transferee is an Affiliate of the Company.

Signature

Date

Signature Guarantee¹

TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.

¹

The Holder's signature must be guaranteed by an "eligible guarantor institution" meeting the requirement of the Registrar which requirements include membership or participation in the Security Transfer Agent Medallion Program ("STAMP") or such other "signature guarantee program" as may be determined by the Registrar in addition to or in substitution for, STAMP, all in accordance with the Exchange Act.

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        The undersigned represents and warrants that it is purchasing this Note for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a "qualified institutional buyer" within the meaning of Rule 144A under the Securities Act of 1933, as amended, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Company as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon the undersigned's foregoing representations in order to claim the exemption from registration provided by Rule 144A.

Dated:                                                  
            [Signature of executive officer of purchaser]

Name:                                                                          

Title:                                                                            

84

CONVERSION NOTICE

To GenCorp Inc.:

        The undersigned owner of this Note hereby irrevocably exercises the option to convert this Note, or the portion below designated, into Common Stock of GenCorp Inc. in accordance with the terms of the Indenture referred to in this Note, and directs that the shares issuable and deliverable upon conversion, together with any check in payment for fractional shares, be issued in the name of and delivered to the undersigned, unless a different name has been indicated in the assignment below. If shares are to be issued in the name of a person other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto.

        Any holder of Notes, upon exercise of its conversion rights in accordance with the terms of the Indenture and the Security, agrees to be bound by the terms of the Registration Rights Agreement relating to the Common Stock issuable upon conversion of the Notes.

[    ] Convert whole	[    ] Convert in part Amount of Note to be converted ($1,000 or integral multiples thereof):
	$ ________________________
	Signature (sign exactly as name appears on the other side of this Note)2

²

The Holder's signature must be guaranteed by an "eligible guarantor institution" meeting the requirement of the Registrar which requirements include membership or participation in the Security Transfer Agent Medallion Program ("STAMP") or such other "signature guarantee program" as may be determined by the Registrar in addition to or in substitution for, STAMP, all in accordance with the Exchange Act.

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If you want the stock certificate made out in another person's name, complete the following for such person:

Name

Social Security or Taxpayer Identification Number

Street Address

City, State and Zip Code

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OPTION OF HOLDER TO ELECT REPURCHASE

        If you want to elect to have this Note repurchased by the Company pursuant to Section 3.9 of the Indenture, check the box:

[    ]

        If you want to elect to have only part of this Note repurchased by the Company pursuant to Section 3.9 of the Indenture, state the principal amount (which shall be $1,000 or a multiple thereof) to be repurchased:

$ ________________________
Dated: ____________________________________	Signature (sign exactly as name appears on the other side of this Note)
Signature Guarantee:(1)3

³

The Holder's signature must be guaranteed by an "eligible guarantor institution" meeting the requirement of the Registrar which requirements include membership or participation in the Security Transfer Agent Medallion Program ("STAMP") or such other "signature guarantee program" as may be determined by the Registrar in addition to or in substitution for, STAMP, all in accordance with the Exchange Act.

87

[Schedule A to Exhibit A]

GLOBAL NOTE TRANSFER SCHEDULE

Changes to Principal Amount of Global Security

Date

Principal Amount of
Securities by which
this Global Security Is
to Be Reduced and
Reasons for Reduction

Remaining Principal
Amount of this Global
Security
(following decrease)

Authorized
Signature of
officer or
Trustee or
Custodian

Schedule to be maintained by Depositary in cooperation with Trustee.

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QuickLinks

TABLE OF CONTENTS
ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE
ARTICLE 2. THE SECURITIES
ARTICLE 3. REDEMPTION AND REPURCHASE
ARTICLE 4. CONVERSION
ARTICLE 5. SUBORDINATION
ARTICLE 6. COVENANTS
ARTICLE 7. SUCCESSOR CORPORATION
ARTICLE 8. DEFAULT AND REMEDIES
ARTICLE 9. TRUSTEE
ARTICLE 10. SATISFACTION AND DISCHARGE OF INDENTURE
ARTICLE 11. AMENDMENTS, SUPPLEMENTS AND WAIVERS
ARTICLE 12. MISCELLANEOUS
FORM OF SECURITY [GLOBAL NOTE LEGEND
[RESTRICTED SECURITIES LEGEND
[FORM OF FACE OF SECURITY] GENCORP INC.
TRANSFER NOTICE
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.
CONVERSION NOTICE
OPTION OF HOLDER TO ELECT REPURCHASE
[Schedule A to Exhibit A]
GLOBAL NOTE TRANSFER SCHEDULE Changes to Principal Amount of Global Security

EX-4.5

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Exhibit 4.5

REGISTRATION RIGHTS AGREEMENT

Dated as of April 5, 2002
By and Between
GENCORP INC.,
as Issuer,
and
DEUTSCHE BANK SECURITIES INC.
and
ABN AMRO ROTHSCHILD LLC
and
BANC ONE CAPITAL MARKETS, INC.
as Initial Purchasers
5³/4% Convertible Subordinated Notes Due 2007

TABLE OF CONTENTS

1.	Definitions	1
2.	Shelf Registration	3
3.	Liquidated Damages	6
4.	Registration Procedures	7
5.	Registration Expenses	13
6.	Indemnification	14
7.	Rules 144 and 144A	17
8.	Underwritten Registrations	17
9.	Miscellaneous	17

REGISTRATION RIGHTS AGREEMENT

        This Registration Rights Agreement (this "Agreement") is dated as of April 5, 2002, by and among GENCORP INC., an Ohio corporation (the "Company"), Deutsche Bank Securities Inc. ("DBSI"), ABN AMRO Rothschild LLC ("ABN") and Banc One Capital Markets, Inc. ("Banc One") (DBSI, ABN and Banc One, individually, an "Initial Purchaser" and together, the "Initial Purchasers").

        This Agreement is entered into in connection with the Purchase Agreement, dated as of April 2, 2002 (the "Purchase Agreement"), by and between the Company and DBSI, as Representative of the Initial Purchasers (in such capacity, the "Representative"), which provides for the sale by the Company to the Initial Purchasers of $125,000,000 aggregate principal amount of the Company's 5³/4% Convertible Subordinated Notes Due 2007 (the "Firm Notes"), which are convertible into Common Stock of the Company, par value $.10 per share (the "Underlying Shares"), plus up to an additional $25,000,000 aggregate principal amount of the same which DBSI may subsequently elect to purchase pursuant to the terms of the Purchase Agreement (the "Additional Notes" and, together with the Firm Notes, the "Convertible Notes"). The Convertible Notes are being issued pursuant to an Indenture dated as of April 5, 2002 (the "Indenture"), between the Company and The Bank of New York, as trustee (as amended or supplemented from time to time, the "Indenture").

        In order to induce the Representative, on behalf of the Initial Purchasers, to enter into the Purchase Agreement, the Company has agreed to provide the registration rights set forth in this Agreement for the benefit of the Initial Purchasers and any subsequent holder or holders of the Convertible Notes or Underlying Shares as provided herein. The execution and delivery of this Agreement is a condition to the obligation of the Initial Purchasers to purchase the Firm Notes under the Purchase Agreement. Terms not otherwise defined herein shall have the meanings set forth in the Purchase Agreement.

        The parties hereby agree as follows:

1.    Definitions.    As used in this Agreement, the following terms shall have the following meanings:

        Additional Notes:    See the second introductory paragraph hereto.

        Agreement:    See the first introductory paragraph hereto.

        Amount of Registrable Securities:    (a) With respect to Convertible Notes constituting Registrable Securities, the aggregate principal amount of all such Convertible Notes outstanding, (b) with respect to Underlying Shares constituting Registrable Securities, the aggregate number of such Underlying Shares outstanding multiplied by the Conversion Price (as defined in the Indenture relating to the Convertible Notes upon the conversion of which such Underlying Shares were issued) in effect at the time of computing the Amount of Registrable Securities or, if no such Convertible Notes are then outstanding, the last Conversion Price that was in effect

under such Indenture when any such Convertible Notes were last outstanding, and (c) with respect to combinations thereof, the sum of (a) and (b) for the relevant Registrable Securities.

        Business Day:    Any day that is not a Saturday, Sunday or a day on which banking institutions in New York or California are authorized or required by law to be closed.

        Closing Date:    April 5, 2002.

        Company:    See the first introductory paragraph hereto.

        Convertible Notes:    See the second introductory paragraph hereto.

        Damages Payment Date:    See Section 3(c) hereof.

        Depositary:    The Depository Trust Company until a successor is appointed by the Company.

        Effectiveness Date:    The 180th day after the later of the Closing Date and the last Option Closing Date, if any.

        Effectiveness Period:    See Section 2(a) hereof.

        Exchange Act:    The Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder.

        Filing Date:    The 60th day after the later of the Closing Date and the last Option Closing Date, if any.

        Firm Notes:    See the second introductory paragraph hereto.

        Holder:    Any holder of Registrable Securities.

        Indemnified Holder:    See Section 6 hereof.

        Indemnified Person:    See Section 6 hereof.

        Indemnifying Person:    See Section 6 hereof.

        Indenture:    See the second introductory paragraph hereto.

        Initial Purchaser:    See the first introductory paragraph hereto.

        Initial Shelf Registration:    See Section 2(a) hereof.

        Inspectors:    See Section 4(m) hereof.

        Liquidated Damages:    See Section 3(a) hereof.

        Notice and Questionnaire:    See Section 2(a) hereof.

2

        Notice Holder:    See Section 2(a) hereof.

        Person:    An individual, partnership, corporation, limited liability company, unincorporated association, trust, joint venture or similar entity, or a governmental agency or political subdivision thereof.

        Prospectus:    The prospectus included in any Registration Statement (including, without limitation, any prospectus subject to completion and a prospectus that includes any information previously omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 430A promulgated under the Securities Act), as amended or supplemented by any prospectus supplement, and all other amendments and supplements to such prospectus, including post-effective amendments, and all material incorporated by reference or deemed to be incorporated by reference in such prospectus.

        Purchase Agreement:    See the second introductory paragraph hereto.

        Records:    See Section 4(m) hereof.

        Registrable Securities:    All Convertible Notes and all Underlying Shares upon original issuance thereof and at all times subsequent thereto until the earliest to occur of (i) a Registration Statement covering such Convertible Notes and Underlying Shares having been declared effective by the SEC and such Convertible Notes and Underlying Shares having been disposed of in accordance with such effective Registration Statement, (ii) such Convertible Notes and Underlying Shares having been sold in compliance with Rule 144 or being eligible for resale (except with respect to affiliates of the Company within the meaning of the Securities Act) in compliance with Rule 144(k), or (iii) such Convertible Notes and any Underlying Shares ceasing to be outstanding.

        Registration Default:    See Section 3(a) hereof.

        Registration Statement:    Any registration statement of the Company filed with the SEC pursuant to the provisions of this Agreement, including the Prospectus, amendments and supplements to such registration statement, including post-effective amendments, all exhibits and all material incorporated by reference or deemed to be incorporated by reference in such registration statement.

        Rule 144:    Rule 144 promulgated under the Securities Act, as such Rule may be amended from time to time, or any similar rule (other than Rule 144A) or regulation hereafter adopted by the SEC providing for offers and sales of securities made in compliance therewith resulting in offers and sales by subsequent holders that are not affiliates of an issuer of such securities being free of the registration and prospectus delivery requirements of the Securities Act.

        Rule 144A:    Rule 144A promulgated under the Securities Act, as such Rule may be amended from time to time, or any similar rule (other than Rule 144) or regulation hereafter adopted by the SEC.

        Rule 415:    Rule 415 promulgated under the Securities Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the SEC.

3

        SEC:    The Securities and Exchange Commission.

        Securities Act:    The Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder.

        Shelf Registration:    See Section 2(b) hereof.

        Shelf Registration Statement:    See Section 2(b) hereof.

        Subsequent Shelf Registration:    See Section 2(b) hereof.

        TIA:    The Trust Indenture Act of 1939, as amended, and the rules and regulations of the SEC promulgated thereunder.

        Trustee:    The Trustee under the Indenture.

        Underlying Shares:    See the second introductory paragraph hereto.

2.    Shelf Registration.

        (a)  Shelf Registration. The Company shall use its reasonable best efforts to file with the SEC a Registration Statement for an offering to be made on a continuous basis pursuant to Rule 415 covering all of the Registrable Securities (the "Initial Shelf Registration") on or prior to the Filing Date.

        The Initial Shelf Registration shall be on Form S-3 or another appropriate form permitting registration of such Registrable Securities for resale by Holders in the manner or manners set forth in such Registration Statement and in Rule 415. The Company shall not permit any securities other than the Registrable Securities to be included in the Initial Shelf Registration or any Subsequent Shelf Registration (as defined below).

        The Company shall use its reasonable best efforts to cause the Initial Shelf Registration to be declared effective under the Securities Act on or prior to the Effectiveness Date and to keep such Initial Shelf Registration continuously effective under the Securities Act until the date that is two years from the later of the Closing Date and the last Option Closing Date (as it may be shortened pursuant to clause (i), (ii) or (iii) immediately following, the "Effectiveness Period"), or such shorter period ending when (i) all the Registrable Securities covered by the Initial Shelf Registration have been sold in the manner set forth and as contemplated in the Initial Shelf Registration, (ii) the date on which all the Registrable Securities (x) held by Persons who are not affiliates of the Company may be resold pursuant to Rule 144(k) under the Securities Act or (y) cease to be outstanding, or (iii) a Subsequent Shelf Registration covering all of the Registrable Securities has been declared effective under the Securities Act.

        Each Holder wishing to include its Registrable Securities in the Initial Shelf Registration Statement prior to the time it is declared effective agrees to deliver a written notice, substantially in the form of Annex A to the Offering Memorandum dated April 2, 2002 used in connection with the offer of the Convertible Notes (a "Notice and Questionnaire"), to the Company not later than 15 days after the last date of original issuance of the Convertible Notes or, if later, five

4

Business Days prior to the effective date of the Shelf Registration Statement (each Holder delivering a Notice and Questionnaire, a "Notice Holder"). From and after the date the Shelf Registration Statement is declared effective, the Company shall, as promptly as reasonably practicable after the date of receipt of a Notice and Questionnaire (and, in any event, within 15 Business Days) (i) if required by applicable law, file with the SEC a post-effective amendment to the Shelf Registration Statement or prepare and, if required by applicable law, file a supplement to the related Prospectus or a supplement or amendment to any document incorporated therein by reference or file any other document required under the Securities Act so that the Holder delivering such Notice and Questionnaire is named as a selling securityholder in the Shelf Registration Statement and the related Prospectus in such a manner as to permit such Holder to deliver such Prospectus to purchasers of the Registrable Securities in accordance with applicable law and, if the Company shall file a post-effective amendment to the Shelf Registration Statement, use reasonable best efforts to cause such post-effective amendment to be declared effective under the Securities Act as promptly as is practicable, but in any event not later than 60 Business Days after the date such post-effective amendment is required by this clause to be filed; (ii) provide such Holder copies of any documents filed pursuant to subheading (i) of this paragraph; and (iii) notify such Holder as promptly as practicable after the effectiveness under the Securities Act of any post-effective amendment filed pursuant to subheading (i) of this paragraph; provided that if such Notice and Questionnaire is delivered during a period pursuant to Section 3(b), the Company shall so inform the Holder delivering such Notice and Questionnaire and shall take the actions set forth in clauses (i), (ii) and (iii) above upon expiration of any period referenced in Section 3(b) of this Agreement. Any Holder who, subsequent to the date the Registration Statement is declared effective, provides a Notice and Questionnaire required by this paragraph pursuant to the provisions of this Section (whether or not such Holder has supplied the Notice and Questionnaire at the time the Shelf Registration Statement was declared effective) shall be named as a selling securityholder in the Shelf Registration Statement and related Prospectus in accordance with the requirements of this paragraph.

        No Holder of Registrable Securities may include any of its Registrable Securities in any Shelf Registration pursuant to this Agreement unless and until such Holder furnishes to the Company a completed and executed Notice and Questionnaire. Each Holder of Registrable Securities as to which any Shelf Registration Statement is being effected agrees to furnish, in accordance with the previous paragraph, to the Company all information required to be disclosed so that the information previously furnished to the Company by such Holder is not materially misleading and does not omit to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading in the light of the circumstances under which they were made and, if such Holder fails to do so, the Company shall be under no obligation to include such Holder's Registrable Securities in any Shelf Registration Statement.

        (b)  Subsequent Shelf Registrations. If the Initial Shelf Registration or any Subsequent Shelf Registration ceases to be effective for any reason at any time during the Effectiveness Period (other than because of the sale of all of the securities registered thereunder), the Company shall use its reasonable best efforts to obtain the prompt withdrawal of any order suspending the effectiveness thereof, and in any event shall within 30 days of such cessation of effectiveness amend the Initial Shelf Registration in a manner to obtain the withdrawal of the order suspending the effectiveness thereof, or file an additional "shelf" Registration Statement

5

pursuant to Rule 415 covering all of the Registrable Securities (a "Subsequent Shelf Registration"). If a Subsequent Shelf Registration is filed, the Company shall use its reasonable best efforts to cause the Subsequent Shelf Registration to be declared effective under the Securities Act as soon as practicable after such filing and to keep such Registration Statement continuously effective for a period equal to the number of days in the Effectiveness Period less the aggregate number of days during which the Initial Shelf Registration and any Subsequent Shelf Registration were previously continuously effective. As used herein the term "Shelf Registration" means the Initial Shelf Registration and any Subsequent Shelf Registration and the term "Shelf Registration Statement" means any Registration Statement filed in connection with a Shelf Registration.

        (c)  Supplements and Amendments. The Company shall promptly supplement and amend the Shelf Registration if required by applicable law or if reasonably requested by the Holders of the majority in Amount of Registrable Securities covered by such Registration Statement or by any underwriter of such Registrable Securities.

3.    Liquidated Damages.

        (a)  The Company and the Initial Purchasers agree that the Holders of Registrable Securities will suffer damages if the Company fails to fulfill its obligations under Section 2 hereof and that it would not be feasible to ascertain the extent of such damages with precision. Accordingly, the Company agrees to pay liquidated damages on the Registrable Securities ("Liquidated Damages") under the circumstances and to the extent set forth below, each of which shall be given independent effect (each a "Registration Default"):

        (i)    if the Initial Shelf Registration is not filed with the SEC on or prior to the Filing Date, then commencing on the day after the Filing Date, Liquidated Damages shall accrue on the Registrable Securities at a rate of 0.50% per annum on the Amount of Registrable Securities;

        (ii)  if the Initial Shelf Registration or a Subsequent Shelf Registration is not declared effective by the SEC on or prior to the Effectiveness Date, then commencing one day after the Effectiveness Date, Liquidated Damages shall accrue on the Registrable Securities at a rate of 0.50% per annum on the Amount of Registrable Securities;

        (iii)  if a Shelf Registration has been declared effective and such Shelf Registration ceases to be effective or the Prospectus therein fails to be available for use at any time during the Effectiveness Period (other than as permitted under Section 3(b)), then Liquidated Damages shall accrue on the Registrable Securities at a rate of 0.50% per annum on the Amount of Registrable Securities; and

        (iv)  if the Company fails with respect to a Notice Holder to amend or supplement the Shelf Registration Statement in a timely manner in accordance with Section 2 in order to name such Notice Holder as a selling securityholder, then Liquidated Damages shall accrue on the Registrable Securities held by such Notice Holder at a rate of 0.50% per annum on the Amount of Registrable Securities held by such Notice Holder.

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provided, however, that Liquidated Damages on Registrable Securities held by any Holder may not accrue under more than one of the foregoing clauses (i), (ii), (iii) or (iv) at any one time; provided, further, however, that (1) upon the filing of the Shelf Registration as required hereunder (in the case of clause (a)(i) of this Section 3), (2) upon the effectiveness of the Shelf Registration as required hereunder (in the case of clause (a)(ii) of this Section 3), (3) upon the effectiveness or availability of a Shelf Registration or Prospectus which had ceased to remain effective or available (in the case of (a)(iii) of this Section 3) or (4) upon inclusion of such Notice Holder in a Shelf Registration Statement (in the case of (a)(iv) of this Section 3), Liquidated Damages on the Registrable Securities as a result of such clause (or the relevant subclause thereof), as the case may be, shall cease to accrue. It is understood and agreed that, notwithstanding any provision to the contrary, so long as any Registrable Security is then covered by an effective Shelf Registration Statement containing a usable Prospectus, no Liquidated Damages shall accrue on such Registrable Security.

        (b)  Notwithstanding paragraph (a) of this Section 3, if the Board of Directors of the Company determines that it is in the best interest of the Company not to disclose the existence of or facts surrounding any proposed or pending material corporate transaction or development involving the Company or its subsidiaries, the Company may suspend the filing or effectiveness of a Shelf Registration or the use of any related Prospectus for up to 30 consecutive days in any 90-day period for a total of not more than 90 days in any calendar year, without paying Liquidated Damages, and, upon notice thereof to each Holder, such Holder shall suspend the use of the Shelf Registration Statement and the related Prospectus until such time as the Company shall have notified such Holder that the Shelf Registration Statement and the related Prospectus are again available for use.

        (c)  So long as Convertible Notes remain outstanding, the Company shall notify the Trustee promptly after each and every date on which an event occurs in respect of which Liquidated Damages is required to be paid. Any amounts of Liquidated Damages due pursuant to (a)(i), (a)(ii), (a)(iii) or (a)(iv) of this Section 3 will be payable in cash semi-annually on each April 15 and October 15 (each a "Damages Payment Date"), commencing with the first such date occurring after any such Liquidated Damages commences to accrue, to Holders to whom regular interest is payable on such Damages Payment Date with respect to Convertible Notes that are Registrable Securities and to Persons that are registered Holders 15 days prior to such Damages Payment Date with respect to Underlying Shares that are Registrable Securities. The amount of Liquidated Damages for Registrable Securities will be determined by multiplying the applicable rate of Liquidated Damages by the Amount of Registrable Securities outstanding on the Damages Payment Date following such Registration Default in the case of the first such payment of Liquidated Damages with respect to a Registration Default (and thereafter at the next succeeding Damages Payment Date until the cure of such Registration Default), multiplied by a fraction, the numerator of which is the number of days such Liquidated Damages rate was applicable during such period (determined on the basis of a 360-day year comprised of twelve 30-day months and, in the case of a partial month, the actual number of days elapsed), and the denominator of which is 360.

        4.    Registration Procedures. In connection with the filing of any Registration Statement pursuant to Section 2 hereof, the Company shall effect such registrations to permit the sale of the securities covered thereby in accordance with the intended method or methods of disposition

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thereof, and pursuant thereto and in connection with any Registration Statement filed by the Company hereunder the Company shall:

        (a)  Prepare and file with the SEC on or prior to the Filing Date, a Registration Statement or Registration Statements as prescribed by Section 2 hereof, and use its commercially reasonable efforts to cause each such Registration Statement to become effective and remain effective as provided herein; provided, however, that before filing any Registration Statement or Prospectus or any amendments or supplements thereto, the Company shall furnish to and afford each Holder of the Registrable Securities covered by such Registration Statement and the managing underwriters, if any, upon their request, a reasonable opportunity to review copies of all such documents proposed to be filed, other than documents filed with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act that are deemed incorporated by reference in such Registration Statement or Prospectus (in each case, where possible, at least five Business Days prior to such filing, or such later date as is reasonable under the circumstances). The Company shall not file any Registration Statement or Prospectus or any amendments or supplements thereto if the Holders of a majority in Amount of Registrable Securities covered by such Registration Statement shall reasonably object.

        (b)  Prepare and file with the SEC such amendments and post-effective amendments to each Shelf Registration, as may be necessary to keep such Registration Statement continuously effective for the Effectiveness Period; cause the related Prospectus to be supplemented by any Prospectus supplement required by applicable law, and as so supplemented to be filed pursuant to Rule 424 (or any similar provisions then in force) promulgated under the Securities Act; and comply with the provisions of the Securities Act and the Exchange Act applicable to it with respect to the disposition of all securities covered by such Registration Statement as so amended or in such Prospectus as so supplemented. Subject to Section 3(b), the Company shall be deemed not to have used its reasonable best efforts to keep a Registration Statement effective during the Effectiveness Period if it voluntarily takes any action that would result in selling Holders of the Registrable Securities covered thereby not being able to sell such Registrable Securities during that period unless such action is required by applicable law or unless the Company complies with this Agreement, including without limitation the provisions of Section 4(k) hereof.

        (c)  Notify the selling Holders of Registrable Securities and the managing underwriters, if any, promptly (but in any event within five Business Days), (i) when a Prospectus or any prospectus supplement or post-effective amendment has been filed, and, with respect to a Registration Statement or any post-effective amendment, when the same has become effective under the Securities Act (including in such notice a written statement that any Holder may, upon written request, obtain, at the sole expense of the Company, one conformed copy of such Registration Statement or post-effective amendment including financial statements and schedules, documents incorporated or deemed to be incorporated by reference and exhibits), (ii) of the issuance by the SEC of any stop order suspending the effectiveness of a Registration Statement or of any order preventing or suspending the use of any Prospectus or the initiation of any proceedings for that purpose, (iii) of the happening of any event, the existence of any condition or any information becoming known that makes any statement made in such Registration Statement or related Prospectus or any document incorporated or deemed to be incorporated therein by reference untrue in any material respect or that requires the making of

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any changes in or amendments or supplements to such Registration Statement, Prospectus or documents so that, in each case, it will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading and (iv) of the Company's determination that a post-effective amendment to a Registration Statement would be appropriate.

        (d)  Use its reasonable best efforts to prevent the issuance of any order suspending the effectiveness of a Registration Statement or of any order preventing or suspending the use of a Prospectus and, if any such order is issued, to use its commercially reasonable efforts to obtain the withdrawal of any such order at the earliest possible moment.

        (e)  If requested by the managing underwriter or underwriters (if any) or the Holders of the majority in Amount of Registrable Securities being sold in connection with an underwritten offering (i) promptly incorporate in a prospectus supplement or post-effective amendment such information as the managing underwriter or underwriters (if any), or such Holders reasonably determine is necessary to be included therein, provided, however, that the Company shall not be required to include any such information upon the request of a Holder or any underwriter if the inclusion of such information would, in the good faith judgment of the Company, violate applicable law, (ii) make all required filings of such prospectus supplement or such post-effective amendment as soon as reasonably practicable after the Company has received notification of the matters to be incorporated in such prospectus supplement or post-effective amendment and (iii) supplement or make amendments to such Registration Statement.

        (f)    Furnish to each selling Holder of Registrable Securities and a single counsel to all such Holders (chosen in accordance with Section 5(b)) and each managing underwriter, if any, at the sole expense of the Company, one conformed copy of the Registration Statement or Registration Statements and each post-effective amendment thereto, including financial statements and schedules, and all documents incorporated or deemed to be incorporated therein by reference and all exhibits.

        (g)  Furnish to each selling Holder of Registrable Securities and a single counsel to all such Holders (chosen in accordance with Section 5(b)) and the underwriters, if any, at the sole expense of the Company, as many copies of the Prospectus (including each form of preliminary prospectus) and each amendment or supplement thereto and any documents incorporated by reference therein as such Persons may reasonably request; and, subject to the last paragraph of this Section 4, the Company hereby consents to the use of such Prospectus and each amendment or supplement thereto by each of the selling Holders of Registrable Securities and the underwriters or agents, if any, and dealers (if any), in connection with the offering and sale of the Registrable Securities covered by such Prospectus and any amendment or supplement thereto in the manner contemplated by such Prospectus.

        (h)  Prior to any public offering of Registrable Securities, to use its reasonable best efforts to register or qualify, to the extent required by applicable law, and to cooperate with the selling Holders of Registrable Securities and the managing underwriter or underwriters, if any, in connection with the registration or qualification (or exemption from such registration or qualification) of such Registrable Securities or offer and sale under the securities or Blue Sky

9

laws of such jurisdictions within the United States as any selling Holder, or the managing underwriter or underwriters, if any, reasonably requests; keep each such registration or qualification (or exemption therefrom) effective during the period such Registration Statement is required to be kept effective and do any and all other acts or things reasonably necessary or advisable to enable the disposition in such jurisdictions of the Registrable Securities covered by the applicable Registration Statement; provided, however, that the Company shall not be required to (A) qualify generally to do business in any jurisdiction where it is not then so qualified, (B) take any action that would subject it to general service of process in any such jurisdiction where it is not then so subject or (C) subject itself to taxation in any such jurisdiction where it is not then so subject.

        (i)    Cooperate with the selling Holders of Registrable Securities and the managing underwriter or underwriters, if any, to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be sold, which certificates shall not bear any restrictive legends and shall be in a form eligible for deposit with Depository; and enable such shares of Registrable Securities to be in such denominations and registered in such names as the Holders may reasonably request.

        (j)    Use its reasonable best efforts to cause the Registrable Securities covered by any Shelf Registration Statement to be registered with or approved by such other governmental agencies or authorities as may be reasonably necessary to enable the seller or sellers thereof or the underwriter or underwriters, if any, to consummate the disposition of such Registrable Securities, except as may be required solely as a consequence of the nature of such selling Holder's business, in which case the Company will cooperate in all reasonable respects with the filing of such Registration Statement and the granting of such approvals.

        (k)  Upon the occurrence of any event contemplated by paragraph 4(c)(ii), 4(c)(iii) or 4(c)(iv) hereof, as promptly as practicable give notice to suspend the availability of the Registration Statement as contemplated by Section 3(b) and, subject to Section 3(b), prepare and (subject to Section 4(a) hereof) file with the SEC, at the sole expense of the Company, a supplement or post-effective amendment to the Registration Statement or a supplement to the related Prospectus or any document incorporated or deemed to be incorporated therein by reference, or file any other required document so that, as thereafter delivered to the purchasers of the Registrable Securities being sold thereunder, any such Prospectus will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

        (l)    In connection with any underwritten offering of Registrable Securities pursuant to a Shelf Registration, enter into an underwriting agreement on customary terms and conditions for underwritten offerings of securities similar to the Registrable Securities and take all such other actions as are reasonably requested by the managing underwriter in order to expedite or facilitate the registration or the disposition of such Registrable Securities and, in such connection, (i) make such representations and warranties to, and covenants with, the underwriters with respect to the business of the Company and its subsidiaries (including any acquired business, properties or entity, if applicable) and the Registration Statement, Prospectus and documents, if any, incorporated or deemed to be incorporated by reference therein, in each

10

case, as are customarily made by issuers to underwriters in underwritten offerings of securities similar to the Registrable Securities and confirm the same in writing if and when requested; (ii) upon the request of the managing underwriter, use all reasonable efforts to obtain the written opinion of counsel to the Company and written updates thereof in form, scope and substance reasonably satisfactory to the managing underwriter or underwriters, addressed to the underwriters covering the matters customarily covered in opinions requested in underwritten offerings of securities similar to the Registrable Securities and such other matters as may be reasonably requested by the managing underwriter or underwriters; (iii) upon the request of the managing underwriter, use all reasonable efforts to obtain "cold comfort" letters and updates thereof in form, scope and substance reasonably satisfactory to the managing underwriter or underwriters from the independent certified public accountants of the Company (and, if necessary, any other independent certified public accountants of any subsidiary of the Company or of any business acquired by the Company for which financia1 statements and financial data are, or are required to be, included or incorporated by reference in the Registration Statement), addressed to each of the underwriters, such letters to be in customary form and covering matters of the type customarily covered in "cold comfort" letters in connection with underwritten offerings of securities similar to the Registrable Securities and such other matters as are reasonably requested by the managing underwriter or underwriters as permitted by the Statement on Auditing Standards No. 72; and (iv) if an underwriting agreement is entered into, cause the same to contain indemnification provisions and procedures no less favorable to the sellers and underwriters, if any, than those set forth in Section 7 hereof (or such other provisions and procedures acceptable to Holders of a majority in Amount of Registrable Securities covered by such Registration Statement and the managing underwriter or underwriters or agents, if any). The above shall be done as and to the extent required by such underwriting agreement.

        (m)  Make available for inspection by any selling Holder of Registrable Securities being sold, any underwriter participating in any such disposition of Registrable Securities, if any, and any attorney, accountant or other agent retained by any such selling Holder, or underwriter (collectively, the "Inspectors"), at the offices where normally kept, during reasonable business hours at such time or times as shall be mutually convenient for the Company and the Inspectors as a group, all financial and other records, pertinent corporate documents and instruments of the Company and its subsidiaries (collectively, the "Records") as shall be reasonably necessary to enable the Inspectors to exercise any applicable due diligence responsibilities, and cause the officers, directors and employees of the Company and its subsidiaries to supply all information in their possession that has been reasonably requested by any such Inspector in connection with such Registration Statement; provided, however, that the foregoing inspection and information gathering shall be coordinated on behalf of such Holders by one firm of counsel, which firm shall be Winston & Strawn until another firm shall be designated pursuant to Section 5(b). Records that the Company determines, in good faith, to be confidential and any Records that it notifies the Inspectors are confidential shall not be disclosed by any Inspector unless (i) the disclosure of such Records is necessary to avoid or correct a material misstatement or material omission in such Registration Statement if such Registration Statement is then available and such Records are not the subject of an applicable legal privilege, (ii) the release of such Records is ordered pursuant to a subpoena or other order from a court of competent jurisdiction, (iii) disclosure of such information is, in the opinion of counsel for any Inspector, necessary in connection with any action, claim, suit or proceeding, directly involving or potentially involving such Inspector and arising out of, based upon, relating to, or involving

11

this Agreement or any transactions contemplated hereby or arising hereunder or (iv) the information in such Records has been made generally available to the public other than through the acts of such Inspector; provided, however, that prior notice shall be provided as soon as practicable to the Company of the potential disclosure of any information by such Inspector pursuant to clauses (i), (ii) or (iii) of this sentence to permit the Company to obtain a protective order (or waive the provisions of this paragraph (m)). Each Inspector shall take such actions as are reasonably necessary to protect the confidentiality of such information to the extent such actions are otherwise not inconsistent with, an impairment of or in derogation of the rights and interests of the Holder or any Inspector, unless and until such information in such Records has been made generally available to the public other than as a result of a breach of this Agreement.

        (n)  Provide (i) the Holders of the Registrable Securities to be included in such Registration Statement and not more than one counsel for all the Holders of such Registrable Securities chosen in accordance with Section 5(b), (ii) the underwriters (which term, for purposes of this Agreement, shall include a Person deemed to be an underwriter within the meaning of Section 2(11) of the Securities Act), if any, thereof, (iii) the sales or placement agent, if any, thereof, and (iv) one counsel for such underwriters or agents, reasonable opportunity to participate in the preparation of such Registration Statement, each Prospectus included therein or filed with the SEC, and each amendment or supplement thereto.

        (o)  Comply with all applicable rules and regulations of the SEC and make generally available to its securityholders earning statements satisfying the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or any similar rule promulgated under the Securities Act) no later than 45 days after the end of any 12-month period (or 90 days after the end of any 12-month period if such period is a fiscal year) (i) commencing at the end of any fiscal quarter in which Registrable Securities are sold to underwriters in a firm commitment or best efforts underwritten offering and (ii) if not sold to underwriters in such an offering, commencing on the first day of the first fiscal quarter of the Company after the effective date of a Registration Statement, which statements shall cover said 12-month periods.

                (p)  Cooperate with each seller of Registrable Securities covered by any Registration Statement and each underwriter, if any, participating in the disposition of such Registrable Securities and their respective counsel in connection with any filings required to be made with the National Association of Securities Dealers, Inc. (the "NASD"), including, if the Conduct Rules of the NASD or any successor thereto as amended from time to time so require, engaging, at the underwriters' (or Holders') expense, a "qualified independent underwriter" ("QIU") as contemplated therein and making Records available to such QIU as though it were a participating underwriter for the purposes of Section 4(m) and otherwise applying the provisions of this Agreement to such QIU (including indemnification) as though it were a participating underwriter.

                (q)  Cause the Indenture to be qualified under the TIA not later than the effective date of the first Registration Statement relating to the Registrable Securities; and in connection therewith, cooperate with the Trustee and the Holders of the Registrable Securities to effect such changes to the Indenture as may be required for the Indenture to be so qualified in accordance with the terms of the TIA; and execute, and use its reasonable best efforts to cause the Trustee to execute, all documents as may be required to effect such changes and all other

12

forms and documents required to be filed with the SEC to enable the Indenture to be so qualified in a timely manner.

                (r)  Use its reasonable best efforts to take all other steps necessary or advisable to effect the registration of the Registrable Securities covered by a Registration Statement contemplated hereby.

        The Company may require each seller of Registrable Securities as to which any registration is being effected to furnish to the Company the Notice and Questionnaire attached to the Offering Memorandum dated April 2, 2002 used in connection with the offer of the Convertible Notes and such other information regarding such seller and the distribution of such Registrable Securities as the Company may, from time to time, reasonably request to the extent necessary or advisable to comply with the Securities Act. Each seller as to which any Shelf Registration is being effected agrees to furnish promptly to the Company all information required to be disclosed so that the information previously furnished to the Company by such seller is not materially misleading and does not omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances under which they were made.

        Each Holder of Registrable Securities agrees by acquisition of such Registrable Securities that, upon actual receipt of any notice from the Company of the happening of any event of the kind described in Section 4(c)(ii), 4(c)(iii) or 4(c)(iv) hereof, or upon the suspension of the availability of the Registration Statement or any Prospectus pursuant to Section 3(b), such Holder will forthwith discontinue disposition of such Registrable Securities covered by such Registration Statement or Prospectus until such Holder's receipt of the copies of the supplemented or amended Prospectus contemplated by Section 4(k) hereof, or until it is advised in writing by the Company that the use of the applicable Prospectus may be resumed, and has received copies of any amendments or supplements thereto.

5.    Registration Expenses.    

                (a)  All fees and expenses incident to the performance of or compliance with this Agreement by the Company shall be borne by the Company, including, without limitation, (i) all registration and filing fees (including, without limitation, (A) fees with respect to filings required to be made with the NASD in connection with any underwritten offering and (B) fees and expenses of compliance with state securities or Blue Sky laws (including, without limitation, reasonable fees and disbursements of counsel in connection with Blue Sky qualifications of the Registrable Securities and determination of the eligibility of the Registrable Securities for investment under the laws of such jurisdictions as provided in Section 4(h) hereof), (ii) printing expenses, including, without limitation, expenses of printing certificates for Registrable Securities in a form eligible for deposit with Depository and of printing Prospectuses, (iii) fees and disbursements of counsel for the Company and reasonable fees and disbursements of one special counsel for the sellers of Registrable Securities (subject to the provisions of Section 5(b) hereof), (iv) fees and disbursements of all independent certified public accountants referred to in Section 4(l)(iii) hereof (including, without limitation, the expenses of any special audit and "cold comfort" letters required by or incident to such performance), (v) Securities Act liability insurance, if the Company desires such insurance, (vi) fees and expenses of all other Persons

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retained by the Company, (vii) internal expenses of the Company (including, without limitation, all salaries and expenses of officers and employees of the Company performing legal or accounting duties), (viii) the expense of any annual audit, (ix) the fees and expenses incurred in connection with the listing of the securities to be registered on any securities exchange, if applicable, and (x) the expenses relating to printing, word processing and distributing all Registration Statements, underwriting agreements, securities sales agreements and any other documents necessary in order to comply with this Agreement. Notwithstanding anything in this Agreement to the contrary, each Holder shall pay all underwriting discounts and brokerage commissions with respect to any Registrable Securities sold by it.

                (b)  The Company shall reimburse the Holders of the Registrable Securities being registered in a Shelf Registration for the reasonable fees and disbursements of not more than one counsel chosen by the Holders of a majority in Amount of Registrable Securities to be included in such Registration Statement, which counsel shall be Winston & Strawn until another firm shall be designated pursuant to this Section 5(b).

6.    Indemnification.    The Company agrees to indemnify and hold harmless (i) each Initial Purchaser, (ii) each Holder, (iii) each Person, if any, who controls (within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act) any of the foregoing (any of the Persons referred to in this clause (iii) being hereinafter referred to as a "controlling person"), (iv) the respective officers, directors, partners, employees, representatives and agents of the Initial Purchasers, the Holders (including predecessor Holders) or any controlling person (any person referred to in clause (i), (ii), (iii) or (iv) may hereinafter be referred to as an "Indemnified Holder"), from and against any and all losses, claims, damages, liabilities and judgments (including, without limitation, reasonable legal fees and other expenses reasonably incurred in connection with any suit, action or proceeding or any claim asserted) caused by any untrue statement or alleged untrue statement of a material fact contained in any Registration Statement or Prospectus, or any amendment or supplement thereto or any related preliminary Prospectus, or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages or liabilities are caused by any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with information relating to any Holder furnished to the Company in writing by such Holder expressly for use in therein; provided, however, that the Company shall not be liable to any Indemnified Holder under the indemnity agreement of this paragraph with respect to any preliminary Prospectus to the extent that any such loss, claim, damage, liability, judgment or expense of such Indemnified Holder results from the fact that such Indemnified Holder sold Registrable Securities under a Registration Statement to a Person as to whom it shall be established that there was not sent or given, at or prior to the written confirmation of such sale, a copy of the Prospectus (or of the preliminary Prospectus as then amended or supplemented if the Company shall have furnished such Indemnified Holder with such amendment or supplement thereto on a timely basis), in any case where such delivery is required by applicable law and the loss, claim, damage, liability or expense of such Indemnified Holder results from an untrue statement or omission of a material fact contained in the preliminary Prospectus which was corrected in the Prospectus (or in the preliminary Prospectus as then amended or supplemented if the Company shall have furnished such Indemnified Holder with such amendment or supplement thereto, as the case may be, on a timely basis). The Company shall notify each Indemnified Holder promptly of the institution,

14

threat or assertion of any claim, proceeding (including any governmental investigation) or litigation in connection with the matters addressed by this Agreement which involves the Company or such Indemnified Holder.

        Each Holder agrees, severally and not jointly, to indemnify and hold harmless the Company, its directors, officers and each Person who controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the foregoing indemnity from the Company to each Holder, but only with reference to such losses, claims, damages or liabilities which are caused by any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with information relating to a Holder furnished to the Company in writing by such Holder expressly for use in any Registration Statement or Prospectus, or any amendment or supplement thereto or any related preliminary Prospectus.

        If any suit, action, proceeding (including any governmental or regulatory investigation), claim or demand shall be brought or asserted against any Person in respect of which indemnity may be sought pursuant to either of the two preceding paragraphs, such Person (the "Indemnified Person") shall promptly notify the Person or Persons against whom such indemnity may be sought (each an "Indemnifying Person") in writing of the commencement thereof. However, the failure so to notify the Indemnifying Person (i) will not relieve it from liability hereunder unless and to the extent it did not otherwise learn of such action and such failure results in the forfeiture by the Indemnifying Person of substantial rights and defenses and (ii) will not, in any event, relieve the Indemnifying Person from any obligations to any Indemnified Person other than the indemnifcation obligation provided hereunder. The Indemnifying Person shall be entitled to participate in such action and, to the extent that it shall wish, jointly with any other Indemnifying Person similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to the Indemnified Person (in which case the Indemnifying Person shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the Indemnified Person or Persons except as set forth below). Notwithstanding the Indemnifying Person's election to assume the defense and employ counsel in an action, an Indemnified Person shall have the right to employ separate counsel (including local counsel), and the Indemnifying Person shall bear the reasonable fees, costs and expenses of such separate counsel if (i) the use of counsel chosen by the Indemnifying Person to represent the Indemnified Person would present such counsel with a conflict of interest, (ii) the actual or potential defendants in, or targets of, any such action include both the Indemnified Person and the Indemnifying Person and the Indemnified Person shall have reasonably concluded that there may be legal defenses available to it and/or other Indemnified Persons which are different from or additional to those available to the Indemnifying Person, (iii) the Indemnifying Person shall have failed to assume the defense and employ counsel reasonably satisfactory to the Indemnified Person within a reasonable time after notice of the institution of such action or (iv) the Indemnifying Person shall authorize the Indemnified Person to employ separate counsel at the expense of the Indemnifying Person. The Indemnifying Person shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, such Indemnifying Person agrees to indemnify any Indemnified Person from and against any loss or liability by reason of such settlement or judgment. No Indemnifying Person shall, without the prior written consent of the Indemnified Person, effect any settlement of any pending or threatened proceeding in respect of which any

15

Indemnified Person is or could have been a party and indemnity could have been sought hereunder by such Indemnified Person, unless such settlement includes an unconditional release of such Indemnified Person from all liability on claims that are the subject matter of such proceeding.

        If the indemnification provided for in the first and second paragraphs of this Section 6 is unavailable to an Indemnified Person or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each Indemnifying Person under such paragraph, in lieu of indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or payable by such Indemnified Person as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Indemnifying Person on the one hand and the Indemnified Person on the other hand pursuant to the Purchase Agreement or from the offering of Convertible Notes or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Indemnifying Person on the one hand and the Indemnified Person on the other in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and any Indemnified Holder on the other shall be deemed to be in the same proportion as the total net proceeds from the initial offering and sale of Convertible Notes (before deducting expenses) received by the Company bear to the total net proceeds received by such Indemnified Holder from sales of Registrable Securities giving rise to such obligations. The relative fault of the parties shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or such Indemnified Holder and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

        Each of the Company and the Initial Purchasers agrees that it would not be just and equitable if contribution pursuant to this Section 6 were determined by pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an Indemnified Person as a result of the losses, claims, damages and liabilities referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses incurred by such Indemnified Person in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 6, in no event shall any Holder be required to contribute any amount in excess of the amount by which the net proceeds received by such Holder from the sale of the Registrable Securities pursuant to a Shelf Registration Statement exceeds the amount of damages which such Holder would have otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.

        The remedies provided for in this Section 6 are not exclusive and shall not limit any rights or remedies that may otherwise be available to any indemnified party at law or in equity.

16

        The indemnity and contribution agreements contained in this Section 6 shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Holder or any Person controlling any Holder or by or on behalf of the Company, its officers or directors or any other Person controlling any of the Company and (iii) acceptance of and payment for any of the Registrable Securities.

7.    Rules 144 and 144A.    The Company covenants that it will file the reports required to be filed by it under the Securities Act and the Exchange Act and the rules and regulations adopted by the SEC thereunder in a timely manner in accordance with the requirements of the Securities Act and the Exchange Act and, for so long as any Registrable Securities remain outstanding, if at any time the Company is not required to file such reports, it will, upon the request of any Holder or beneficial owner of Registrable Securities, make available such information necessary to permit sales pursuant to Rule 144A under the Securities Act. The Company further covenants that, for so long as any Registrable Securities remain outstanding, it will use its reasonable best efforts to take such further action as any Holder of Registrable Securities may reasonably request, all to the extent required from time to time to enable such holder to sell Registrable Securities without registration under the Securities Act within the limitation of the exemptions provided by (a) Rule 144(k) and Rule 144A under the Securities Act, as such rules may be amended from time to time, or (b) any similar rule or regulation hereafter adopted by the SEC. Notwithstanding the foregoing, nothing in this Section 7 shall be deemed to require the Company to register any of its securities pursuant to the Exchange Act.

8.    Underwritten Registrations.

        If any of the Registrable Securities covered by any Shelf Registration are to be sold in an underwritten offering, the investment banker or investment bankers and manager or managers that will manage the offering will be selected by the Holders of the majority in Amount of Registrable Securities to be included in such offering and be reasonably acceptable to the Company.

        No Holder of Registrable Securities may participate in any underwritten registration hereunder unless such Holder (a) agrees to sell such Holder's Registrable Securities on the basis provided in any underwriting arrangements approved by the Persons entitled hereunder to approve such arrangements and (b) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements.

9.    Miscellaneous.

        (a)  No Inconsistent Agreements. The Company has not, as of the date hereof, and the Company shall not, after the date of this Agreement, enter into any agreement with respect to any of its securities that is inconsistent with the rights granted to the Holders of Registrable Securities in this Agreement or otherwise conflicts with the provisions hereof. The rights granted to the Holders hereunder do not in any way conflict with and are not inconsistent with the rights granted to the holders of the Company's other issued and outstanding securities under any such agreements. The Company has not entered and will not enter into any agreement

17

with respect to any of its securities that will grant to any Person registration rights with respect to a Registration Statement.

        (b)  Adjustments Affecting Registrable Securities. The Company shall not, directly or indirectly, take any action with respect to the Registrable Securities as a class that would adversely affect the ability of the Holders of Registrable Securities to include such Registrable Securities in a Shelf Registration undertaken pursuant to this Agreement.

        (c)  Amendments and Waivers. The provisions of this Agreement may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, otherwise than with the prior written consent of the Company and the Holders of not less than a majority in Amount of Registrable Securities; provided, however, that Section 6 and this Section 9(c) may not be amended, modified or supplemented without the prior written consent of the Company and each Holder (including, in the case of an amendment, modification or supplement of Section 6, any Person who was a Holder of Registrable Securities disposed of pursuant to any Registration Statement). Notwithstanding the foregoing, a waiver or consent to depart from the provisions hereof with respect to a matter that relates exclusively to the rights of Holders of Registrable Securities whose securities are being sold pursuant to a Registration Statement and that does not directly or indirectly affect, impair, limit or compromise the rights of other Holders of Registrable Securities may be given by Holders of at least a majority in Amount of Registrable Securities being sold by such Holders pursuant to such Registration Statement. Each Holder of Registrable Securities outstanding at the time of any such amendment, modification, supplement, waiver or consent or thereafter shall be bound by any such amendment, modification, supplement, waiver or consent effected pursuant to this Section 9(c), whether or not any notice, writing or marking indicating such amendment, modification, supplement, waiver or consent appears on the Registrable Securities or is delivered to such Holder. Each Holder may waive compliance with respect to any obligation of the Company under this Agreement as it may apply or be enforced by such particular Holder.

        (d)  Notices. All notices and other communications provided for or permitted hereunder shall be made in writing by hand-delivery, registered first-class mail, next-day air courier or facsimile:

        (1)  if to a Holder of the Registrable Securities, at the most current address of such Holder set forth on the records of the security registrar under the Indenture, in the case of Holders of Convertible Notes, and in the stock ledger of the Company, in the case of Holders of common stock of the Company.

(2)    if to the Initial Purchasers:

Deutsche Bank Securities Inc.
One South Street
Baltimore, Maryland 21202
Facsimile No.: 410-895-3619
Attention: General Counsel

        with copies to:

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Winston & Strawn
200 Park Avenue
New York, New York 10166
Facsimile No.: (212) 294-4700
Attention: Daniel A. Ninivaggi, Esq.

(3)    if to the Company, at the addresses as follows:

GenCorp Inc.
P.O. Box 537012
Sacramento, California 95853-7012
Attention: Terry L. Hall
Facsimile No.: 916-351-8668

        with copies to:

Jones, Day, Reavis & Pogue
North Point
901 Lakeside Avenue
Cleveland, Ohio 44114
Attention: Christopher Kelly
Facsimile: 216-579-0212

        All such notices and communications shall be deemed to have been duly given: when delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; one Business Day after being timely delivered to a next-day air courier; and when the addressor receives facsimile confirmation, if sent by facsimile.

        (e)  Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties hereto, including the Holders; provided, however, that this Agreement shall not inure to the benefit of or be binding upon a successor or assign of a Holder unless and except to the extent such successor or assign holds Registrable Securities.

        (f)    Counterparts. This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

        (g)  Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

        (h)  Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE JURISDICTION

19

OF THE FEDERAL AND NEW YORK STATE COURTS SITTING IN MANHATTAN, NEW YORK CITY, THE STATE OF NEW YORK, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.

        (i)    Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their best efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.

        (j)    Securities Held by the Company or Its Affiliates. Whenever the consent or approval of Holders of a specified percentage in Amount of Registrable Securities is required hereunder, Registrable Securities held by the Company or its affiliates (as such term is defined in Rule 405 under the Securities Act) shall not be counted in determining whether such consent or approval was given by the Holders of such required percentage.

        (k)  Third-Party Beneficiaries. Holders of Registrable Securities are intended third party beneficiaries of this Agreement and this Agreement may be enforced by such Persons.

        (l)    Entire Agreement. This Agreement, together with the Purchase Agreement and the Indenture, is intended by the parties as a final and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein and therein and any and all prior oral or written agreements, representations, or warranties, contracts, understandings, correspondence, conversations and memoranda between the Initial Purchasers on the one hand and the Company on the other, or between or among any agents, representatives, parents, subsidiaries, affiliates, predecessors in interest or successors in interest with respect to the subject matter hereof and thereof are merged herein and replaced hereby.

[Signature page immediately follows]

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        IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

GENCORP INC.
By:	/s/  YASMIN R. SEYAL Name: Yasmin R. Seyal Title: Senior Vice President, Financing           Treasurer, and acting Chief           Financial Officer
DEUTSCHE BANK SECURITIES INC.
By:	/s/  JEFFREY A. BAKER Name: Jeffrey A. Baker Title: Director
ABN AMRO ROTHSCHILD LLC
By:	/s/  NEIL COLLINGRIDGE Name: Neil Collingridge Title: Senior Vice President           ABN AMRO Inc.
BANC ONE CAPITAL MARKETS, INC.
By:	/s/  THOMAS J. MCGRATH Name: Thomas J. McGrath Title: Managing Director

S-1

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TABLE OF CONTENTS
REGISTRATION RIGHTS AGREEMENT

EX-5.1

Exhibit 5.1

[Letterhead of Jones, Day, Reavis & Pogue]

June 3, 2002

GenCorp Inc.
Highway 50 and Aerojet Road
Rancho Cordova, California 95670

Ladies and Gentlemen:

We are acting as special counsel for Gencorp Inc., an Ohio corporation (the “Company”), in connection with its filing with the Securities and Exchange Commission of a Registration Statement on Form S-3 (the “Registration Statement”), with respect to the registration for resale under the Securities Act of 1933, as amended (the “Act”) of $150,000,000 aggregate principal amount of the Company’s 5-3/4% Convertible Subordinated Notes due 2007 (the “Notes”) and the shares of Common Stock, par value $0.10 per share (the “Common Stock”), issuable upon conversion of the Notes, including the rights attached to such shares of Common Stock.  The Notes were issued pursuant to an indenture, dated April 5, 2002 (the “Indenture”), by and between the Company and The Bank of New York, as trustee.

In rendering this opinion, we have examined such documents and records, including an examination of originals or copies certified or otherwise identified to our satisfaction, and matters of law as we have deemed necessary for purposes of this opinion.  Based upon the foregoing and subject to the assumptions, qualifications and limitations stated herein, we are of the opinion that:

1.           The aggregate principal amount of Notes being registered for resale are validly issued and outstanding obligations of the Company;

2.           Assuming that sufficient authorized shares of the Common Stock are then authorized and available for issuance upon conversion of the Notes in accordance with the terms of the Notes and the Indenture, such shares of Common Stock will be validly issued, fully paid and non-assessable; and

3.           When issued in accordance with the Shareholder Rights Agreement, dated as of February 18, 1987, as amended on December 7, 1987, August 21, 1995 and January 20, 1997 (the “Rights Agreement”), between the Company and The Bank of New York, as rights agent, the Rights (as defined in the Rights Agreement) will be validly issued.

In rendering this opinion, we have assumed that (i) the Registration Statement, and any amendments thereto, will have become effective, (ii) the resolutions authorizing the Company to register, offer, sell and issue the Notes and the Common Stock and reserve the Common Stock for issuance, will remain in effect and unchanged at all times during which the Notes and the Common Stock are offered, sold or issued by the Company, and (iii) all Notes and Common Stock will be issued in compliance with applicable Federal and state securities laws.

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Our examination of matters of law in connection with the opinions expressed herein has been limited to, and accordingly our opinions herein are limited to, the laws of the State of New York and the State of Ohio.  We express no opinion with respect to the laws of any other jurisdiction.

The opinion set forth in paragraph 2 is limited to the valid issuance of the Rights under the corporation laws of the State of Ohio.  We do no express any opinion herein with respect to any other aspect of the Rights, the effect of the equitable principals or fiduciary considerations relating to the adoption of the Rights Agreements or the issuance of the Rights or the enforceability of any particular provisions of the Rights Agreement.  In rendering the opinion set forth in paragraph 3 above, we have assumed that the Board of Directors of the Company has acted and will act in the good faith exercise of its business judgment with respect to the authorization of the issuance of the Rights and the execution of the Rights Agreement.

In rendering the opinion set forth in paragraph 3 above moreover, we note that our research indicates that there are no reported decision applying Ohio law concerning the authorization or issuance of securities substantially similar to the Rights.  In the absence of directly applicable judicial authority, we have considered the pertinent provisions of Ohio corporation law and the decision of courts applying the laws of other jurisdictions to analogous factual situations.  Although such decisions may be persuasive to Ohio courts, they have no binding precedental effect.

We hereby consent to the filing of this opinion as Exhibit 5.1 to the Registration Statement  filed by the Company to register the resale of the Notes and Common Stock, including the Rights attached to the Common Stock, under the Act and to the reference to our Firm under the caption “Legal Matters” in the prospectus constituting a part of such Registration Statement.  In giving such consent, we do not hereby admit that we are included in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Securities and Exchange Commission promulgated thereunder.

Very truly yours,

/s/ Jones, Day, Reavis & Pogue

2

EX-12.1

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Exhibit 12.1

Computation of Ratio of Earnings to Fixed Charges

		Year Ended November 30,
														Three Months Ended February 28, 2002
		1997		1998		1999		2000			2001
Earnings:
	Income from continuing operations before income taxes	$	54	$	60	$	74	$	87		$	187		$	5
	Fixed charges included in income from operations per below		14		8		7		20			36			3
	Minority interest		—		—		—		(3	)		(4	)		—
	Amortization of financing costs		—		—		—		—			3			1
	Total earnings		68		68		81		104			222			9
Fixed Charges:
	Interest expense	$	12	$	6	$	6	$	18		$	33		$	3
	Portion of rent expense representing interest		2		2		1		2			3			—
	Fixed charges included in income from operations		14		8		7		20			36			3
	Capitalized financing costs		—		—		1		—			14			—
	Total fixed charges		14		8		8		20			50			3
Ratio of earnings to fixed charges			4.9		8.5		10.1		5.2			4.4			3.0

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Computation of Ratio of Earnings to Fixed Charges

EX-23.1

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Exhibit 23.1

Consent of Ernst & Young LLP, Independent Auditors

        We consent to the reference to our firm under the caption "Experts" in the Registration Statement (Form S-3) and related Prospectus of GenCorp Inc. for the registration of $150,000,000 of its 5³/4% Convertible Subordinated Notes due 2007 and to the incorporation by reference therein of our report dated February 28, 2002, with respect to the consolidated financial statements of GenCorp Inc. included in its Annual Report (Form 10-K) for the year ended November 30, 2001, filed with the Securities and Exchange Commission.

/s/  ERNST & YOUNG LLP

Sacramento, California
May 31, 2002

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Consent of Ernst & Young LLP, Independent Auditors

EX-24.1

Exhibit 24.1

POWERS OF ATTORNEY

By signing below, I hereby constitute and appoint Robert A. Wolfe, Terry L. Hall, and Yasmin R. Seyal my true and lawful attorney or attorneys-in-fact, with full power of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments in my name and behalf in my capacities as a director and/or officer of GenCorp Inc., an Ohio corporation (the “Company”), that said attorney or attorneys-in fact, or any of them, may deem necessary or advisable or that may be required to enable the Company to comply with the Securities Act of 1933, as amended (the “Securities Act”), and the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with one or more registration statements on Form S-3 (or any other appropriate form) and any abbreviated registration statement relating thereto for the purpose of registering pursuant to the Securities Act and/or the Exchange Act (i) up to $150 million of the Company’s outstanding 5³/₄% Convertible Subordinated Notes due 2007, and the shares of the Company’s Common Stock issuable upon conversion thereof for resale by the holders thereof from time to time and (ii) debt and equity securities of the Company, and securities exercisable or exchangeable for, or convertible into such debt and equity securities, having an aggregate offering price not to exceed $300 million, for sale from time to time, including (in each case) specifically, but without limiting the generality of the foregoing, the power and authority to sign for me, in my name and behalf in my capacities as director and/or officer of the Company (individually or on behalf of the Company), each such registration statement and any such abbreviated registration statement, and any and all amendments, including post-effective amendments, and supplements thereto, and any registration statement filed pursuant to Rule 462(b) of the Securities Act, and to file the same, with any and all exhibits thereto and other instruments or documents in connection therewith, with the Securities and Exchange Commission, and hereby ratify and confirm all that said attorneys and agents, or any of them, may do or cause to be done by virtue hereof.

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IN WITNESS WHEREOF, I have executed this Powers of Attorney as of May 16, 2002.

/s/ Robert A. Wolfe	/s/ Terry L. Hall
Robert A. Wolfe	Terry L. Hall
/s/ Yasmin R. Seyal	/s/ J. Robert Anderson
Yasmin R. Seyal	J. Robert Anderson
/s/ J. Gary Cooper	/s/ James J. Didion
J. Gary Cooper	James J. Didion
/s/ Irving Gutin	/s/ William K. Hall
Irving Gutin	William K. Hall
/s/ James M. Osterhoff	/s/ Steven G. Rothmeier
James M. Osterhoff	Steven G. Rothmeier
/s/ Shelia E. Widnall
Sheila E. Widnall

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EX-25.1

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Exhibit 25.1

FORM T-1

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE

CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2)        o

THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)

New York	13-5160382
(State of incorporation if not a U.S. national bank)	(I.R.S. employer identification no.)
One Wall Street, New York, N.Y.	10286
(Address of principal executive offices)	(Zip code)

GenCorp Inc.
(Exact name of obligor as specified in its charter)

Ohio	34-0244000
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)
Highway 50 and Aerojet Road Rancho Cordova, California	95853-7012
(Address of principal executive offices)	(Zip code)

5³/4% Subordinated Notes
(Title of the indenture securities)

1.    General information. Furnish the following information as to the Trustee:

        (a)    Name and address of each examining or supervising authority to which it is subject.

Name	Address
Superintendent of Banks of the State of New York	2 Rector Street, New York, N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York	33 Liberty Plaza, New York, N.Y. 10045
Federal Deposit Insurance Corporation	Washington, D.C. 20429
New York Clearing House Association	New York, New York 10005

        (b)    Whether it is authorized to exercise corporate trust powers.

        Yes.

2.    Affiliations with Obligor.

        If the obligor is an affiliate of the trustee, describe each such affiliation.

        None.

16.    List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the "Act") and 17 C.F.R. 229.10(d).

1.

A copy of the Organization Certificate of The Bank of New York (formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637.)



4.

A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 33-31019.)



6.

The consent of the Trustee required by Section 321(b) of the Act. (Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.)



7.

A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

SIGNATURE

        Pursuant to the requirements of the Act, the Trustee, The Bank of New York, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 6th day of May, 2002.

THE BANK OF NEW YORK
By:	/s/  ROBERT A. MASSIMILLO Name: ROBERT A. MASSIMILLO Title: VICE PRESIDENT

EXHIBIT 7

Consolidated Report of Condition of

THE BANK OF NEW YORK

of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,

a member of the Federal Reserve System, at the close of business December 31, 2001, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.

		Dollar Amounts In Thousands
ASSETS
Cash and balances due from depository institutions:
	Noninterest-bearing balances and currency and coin	$	3,163,218
	Interest-bearing balances		5,923,554
Securities:
	Held-to-maturity securities		1,210,537
	Available-for-sale securities		9,596,941
Federal funds sold and Securities purchased under agreements to resell			4,723,579
Loans and lease financing receivables:
	Loans and leases held for sale		1,104,560
	Loans and leases, net of unearned income		36,204,516
	LESS: Allowance for loan and lease losses		608,227
	Loans and leases, net of unearned income and allowance		35,596,289
Trading Assets			8,039,857
Premises and fixed assets (including capitalized leases)			836,786
Other real estate owned			1,292
Investments in unconsolidated subsidiaries and associated companies			207,616
Customers' liability to this bank on acceptances outstanding			292,295
Intangible assets
	Goodwill		1,579,965
	Other intangible assets		18,971
Other assets			5,723,285

Total assets		$	78,018,745
LIABILITIES
Deposits:
	In domestic offices	$	28,786,182
	Noninterest-bearing		12,264,352
	Interest-bearing		16,521,830
	In foreign offices, Edge and Agreement subsidiaries, and IBFs		27,024,257
	Noninterest-bearing		407,933
	Interest-bearing		26,616,325
Federal funds purchased and securities sold under agreements to repurchase			1,872,762
Trading liabilities			2,181,529
Other borrowed money: (includes mortgage indebtedness and obligations under capitalized leases)			1,692,630
Bank's liability on acceptances executed and outstanding			336,900
Subordinated notes and debentures			1,940,000
Other liabilities			7,217,748
Total liabilities		$	71,052,008
EQUITY CAPITAL
Common stock			1,135,284
Surplus			1,050,729
Retained earnings			4,266,676
Accumulated other comprehensive income			13,733
Other equity capital components			0
Total equity capital			6,466,422
Total liabilities and equity capital		$	78,015,745

        I, Thomas J. Mastro, Senior Vice President and Comptroller of the above-named bank do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true to the best of my knowledge and belief.

Thomas J. Mastro,
Senior Vice President and Comptroller

        We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us and to the best of our knowledge and belief has been

prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true and correct.

Thomas A. Renyi
Gerald L. Hassell                  Directors
Alan R. Griffith

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SIGNATURE
Consolidated Report of Condition of THE BANK OF NEW YORK of One Wall Street, New York, N.Y. 10286 And Foreign and Domestic Subsidiaries,