Exhibit 10.2
LETTER AGREEMENT
     THIS LETTER AGREEMENT (this “Agreement”), dated as of March 5, 2008 (the
“Effective Date”) is made and entered into by and between GenCorp Inc., an Ohio
corporation (the “Company”), and J. Scott Neish (the “Executive”).
Recitals:
     A. The Company and Steel Partners II, L.P. are parties to that certain
Second Amended and Restated Shareholder Agreement dated March 5, 2008 (the
“Shareholder Agreement”).
     B. Pursuant to the Shareholder Agreement, Terry L. Hall resigned as Chief
Executive Officer and President of the Company on the Effective Date.
     C. Executive is currently Vice President of the Company and President of
Aerojet-General Corporation (“Aerojet”), a subsidiary of the Company.
     D. On the Effective Date, the Board of Directors of the Company (the
“Board”) appointed Executive as interim Chief Executive Officer and interim
President of the Company in accordance with Section 2.1(b) of the Shareholder
Agreement subject to the terms and conditions set forth in this Agreement.
     NOW, THEREFORE, the Company and Executive agree as follows:

1.   Executive will serve as interim Chief Executive Officer and interim
President of the Company at the pleasure of the Board until such time as a New
CEO (as defined in the Shareholder Agreement) is appointed by the Board.
Additionally, during such time, Executive will continue to serve as Vice
President and President, Aerojet-General Corporation.

2.   In consideration of Executive’s serving as interim Chief Executive Officer
and interim President, the Company agrees as follows:

  (a)   At the earlier of (i) November 30, 2008, and (ii) the appointment of a
New CEO, the Company shall pay to Executive a one-time bonus in the amount of
three hundred fifty thousand dollars ($350,000);     (b)   If Executive serves
in the positions of interim Chief Executive Officer and interim President after
November 30, 2008, the Board shall determine a suitable additional bonus;    
(c)   If Executive leaves the employ of the Company or its subsidiaries on or
prior to March 4, 2010, either voluntarily or involuntarily (except with Cause
(as defined in that certain severance agreement by and between the Company and
Executive dated on or about August 10, 2006 (the “Severance Agreement”)), the
Company shall purchase the condominium owned by Executive on the Effective Date
and located at ________________, Sacramento, California at the then prevailing

 

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      fair market value. The terms and conditions of such purchase shall be
substantially similar to the Company’s policy with respect executive relocation.
Executive shall not be entitled to other benefits with respect to any
relocation.

3.   As a condition to the appointment to the positions of interim Chief
Executive Officer and interim President, and the receipt of the benefits set
forth in paragraph 2 hereof, Executive hereby acknowledges that (i) the removal
of Executive from one or both of the positions of interim Chief Executive
Officer and interim President in and of itself shall not give rise to the deemed
occurrence of Constructive Termination as defined in the Severance Agreement,
and (ii) Executive shall not be deemed a “Corporate Headquarters” employee
eligible for the benefits set forth under Section 4.12 of the GenCorp
Consolidated Pension Plan (Program B).

4.   The validity, interpretation, construction and performance of this
Agreement will be governed by and construed in accordance with the substantive
laws of the State of California, without giving effect to the principles of
conflict of laws of such State.

5.   This Agreement may be executed in one or more counterparts, each of which
shall be deemed to be an original but all of which together will constitute one
and the same agreement.

     IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the date first above written.

            EXECUTIVE
      /s/ J. Scott Neish       J. SCOTT NEISH              GENCORP INC.
      By:   /s/ Yasmin R. Seyal         Yasmin R. Seyal        Senior Vice
President and
Chief Financial Officer     

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