Document:

Exhibit
10.8.27

 

UNSECURED
SUBORDINATED NOTE

 

	
  $1,000,000

  	
  May 17, 2002

  
	
   

  	
  Walnut Creek,
  California

  

 

1.             Promise to
Pay.    This Unsecured Subordinated Note (this “Note”), is the
promise of WESTAFF (USA), INC., a California corporation (“Payor”) to
pay to DWIGHT S. PEDERSEN, and his successors and assigns (“Holder”),
the principal amount and all interest accrued the loan (the “Loan”),
made by Holder to the undersigned, in the amount of ONE MILLION DOLLARS
(US$1,000,000) (the “Principal Amount”).  Upon the terms and conditions hereof, Payor hereby
unconditionally promises to pay to the order of Holder at such address as
Holder shall hereinafter designate to Payor in writing, in lawful money of the
United States of America and in immediately available funds, the Principal
Amount, and to pay interest on the outstanding principal balance of the Loan as
computed in the manner set forth in Section 3 below.  In addition, Payor shall pay Holder a fee of
THIRTY THOUSAND DOLLARS (US$30,000) on the date of this Note (the “Note
Fee”).  All capitalized terms herein
shall have the meanings as provided herein (including Section 13 below),
and if not defined herein, shall have the respective meanings as defined in
Annex A of that certain Westaff (USA), Inc., Westaff (U.K.) Limited, Westaff
Support, Inc., Westaff (CA), Inc., and Westaff Limited Partnership, as
Borrowers, Westaff, Inc., as Guarantor, General Electric Capital Corporation,
as Agent, and the Lenders signatory thereto (as amended, supplemented,
replaced, refinanced or otherwise modified from time to time, “Credit
Agreement”).

 

2.             Maturity.  Subject to Section 4 hereof, the
Principal Amount of the Loan made under this Note, plus all accrued and unpaid
interest thereon, shall be due and payable on the earlier of (a) on August 18,
2007 (the “Maturity Date”), or (b) 10 calendar days after the
payment in full in cash of the Term Loan upon the sale of the real property
described in the Deed of Trust, but only from the proceeds of the sale of such
real property (the “Prepayment Event”). 
Subject to the provisions of Section 4(c), Payor may also prepay
all or any portion of this Note at any time without penalty.  All payments to Holder shall be accompanied
by a certificate from an officer of Payor certifying that Payor is not prohibited
from making payments under Section 4(c) hereof.  All payments received from Payor hereunder
shall be applied first, to the payment of any unpaid interest under this Note,
and second, to reduce the principal balance hereunder.

 

3.             Interest
Rate.  Payor shall pay
interest to Holder on the outstanding and unpaid principal amount of the Loan
at the rate (the “Interest Rate”) equal to the US Index Rate (as calculated
under the Credit Agreement) plus the Applicable Term Loan Index Margin (as
calculated under the Credit Agreement) calculated on the basis of a year of 365
days for the actual number of days elapsed, provided, however,
that in no event 

1

 

shall the Interest Rate exceed
the maximum rate permitted by law. 
Interest accruing on the principal amount of the Loan shall be paid by
Payor to Holder 45 calendar days after the end of each Fiscal Period (subject
to the Section 4(c) hereof).  For
the purposes of this Note, “Fiscal Period” means any  means any of the 13 four-week accounting
periods of Payor.

 

4.             Subordination.

 

(a)           Payor and Holder agree that all payments under this Note
are and shall be subordinate, to the extent and in the manner hereinafter set
forth, in right of payment to the prior cash payment in full of all of Payor’s
payment obligations now or hereafter existing in respect of any Senior Debt (as
defined in Section 13 below), whether for principal, interest, fees,
expenses or otherwise (such payment obligations being the “Senior Obligations”).

 

(b)           Senior Debt Holders (as defined in Section 13
below) will be entitled to receive payment in full of all Senior Obligations
due in respect of Senior Debt (including interest after the commencement of any
bankruptcy proceeding at the rate specified in the applicable Senior Debt,
without regard to whether or not such interest is an allowed claim, but except
for any contingent indemnity obligation) before Holder will be entitled to
receive any payment with respect to this Note, in the event of any distribution
to creditors of Payor:  (i) in a
liquidation or dissolution of Payor; (ii) in a bankruptcy, reorganization,
insolvency, receivership or similar proceeding relating to Payor or its
property; (iii) in an assignment for the benefit of creditors; or (iv) in any
marshaling of Payor’s assets and liabilities.

 

(c)           Payor may make principal and interest payments under this
Note when due, without acceleration, except, as long as any Senior Obligations
are outstanding, Payor may not make any payment in respect of this Note in the
event of any of the following:

 

(i)            in the event any default in the
payment of principal of, interest or premium, if any, on any Senior Debt occurs
and is continuing under the agreement, indenture or other document governing
such Senior Debt (a “Payment Default”), or

 

(ii)           in the event (A) any default
(other than a Payment Default) occurs and is continuing with respect to any  Senior
Debt which with the giving of notice or the passage of time, would permit the
Agent or the Senior Debt Holders to accelerate the maturity of the Senior Debt;
or (B) after giving effect to the payment to be made in respect of this
Note, a default would exist that, with the giving of notice or the passage of
time, would permit the Agent or the Senior Debt Holders to accelerate the
maturity of the Senior Debt; or (C) except with respect to the prepayment of
this Note in connection with a Prepayment Event (which prepayment shall not
require any Borrowing Availability under the Credit Agreement, as long as the Term
Loan has been paid in full in cash), after giving 

2

 

effect to the proposed payment hereunder, the
Borrowers under the Credit Agreement shall have an aggregate Borrowing
Availability (as defined in the Credit Agreement) of the US Dollar
Equivalent  (as defined in the Credit
Agreement) of less than the greater of (y) fifteen percent (15%) of the
Aggregate Borrowing Base (as defined in the Credit Agreement) or (y) $5,000,000,
and in each instance under Clauses (A), (B) and (C) hereof, any Senior Debt
Holder shall have delivered to Payor and Holder at the addresses set forth in
Section 8 below notice of such default or condition (a “Payment Blockage
Notice”) from any Senior Debt Holder.

 

(d)           Payments on this Note may and shall be resumed (i) in
the case of a Payment Default, or (ii) in the case Payor and Holder
receive a Payment Blockage Notice, upon the date on which such Payment Default
or the default or condition described in the Payment Blockage Notice is cured
or waived.

 

(e)           In the event that Holder receives any payment with respect
to this Note at a time when such payment is prohibited by Section 4(c)
hereof, such payment (the “Unpermitted Payment”) shall be held by
Holder, in trust for the benefit of the Senior Debt Holders.  Upon written request of the Agent, Holder
shall deliver the Unpermitted Payment in trust to the Agent to be applied to
the Senior Obligations.

 

(f)            Intentionally Left Blank

 

(g)           This Section 4 defines the relative rights of
Holder and Senior Debt Holders.  Nothing
in this Note shall:

 

(i)            impair, as between Payor and Holder,
the obligation of Payor, which is absolute and unconditional, to pay principal
of and interest on this Note in accordance with its terms;

 

(ii)           affect the relative rights of Holder
and creditors of Payor other than their rights in relation to Senior Debt
Holders; and

 

(iii)          if Payor fails because of this Section
4 to pay principal of or interest on this Note on the due date, the failure
is still a default hereunder.

 

(h)           No right of any Senior Debt Holder to enforce the
subordination of the indebtedness evidenced by this Note shall be impaired by
any act or failure to act by Payor or Holder or by the failure of Payor or
Holder to comply with the terms of this Note.

 

(i)            Upon any payment or distribution of assets of Payor
referred to in Section 4(a), Holder shall be entitled to rely upon
any order or decree made by any court of competent jurisdiction or upon any
certificate of a representative or of the liquidating trustee or agent or other
Person making any distribution to Holder of this Note for the purpose of
ascertaining the Persons entitled to participate in such 

 

3

 

distribution, the Senior Debt Holders and other
indebtedness of Payor, the amount thereof or payable thereon, the amount or
amounts paid or distributed thereon and all other facts pertinent thereto or to
this Section 4.

 

(j)            For the purposes of this Note, the Senior Obligations
shall not be deemed to have been paid in full unless the Senior Debt Holders
shall have received cash payment in full of all Senior Obligations (whether
matured or unmatured), with the exception of contingent indemnity obligations
and all commitments to extend further financial accommodations under the Credit
Agreement shall have terminated.

 

(k)           Holder (i) will not take, sue for, or demand from Payor
payment of all or any portion of this Note (with the exception of a demand for
a regularly scheduled interest payment for which payment is permitted under
Section 4(c));  (ii) will not
commence, or join with any creditor other than the Senior Debt Holders in
commencing, directly or indirectly, or cause Payor to commence, or assist Payor
in commencing, any proceeding referred to in Section 4(a); and (iii)
will not initiate, prosecute or participate in any claim, action or other
proceeding challenging the enforceability, validity, perfection or priority of
the Senior Debt or any lien or security interest granted to secure the Senior
Debt.

 

(l)            Holder undertakes to execute, verify, deliver and file
any proofs of claim that the Senior Debt Holders may at any time require to
prove and realize upon any rights or claims pertaining to this Note and to
effectuate the full benefit of the subordination contained herein; and upon
failure of Holder so to do, the Senior Debt Holders shall be deemed to be
irrevocably appointed the agent and attorney-in-fact of Holder to execute,
verify, deliver and file any such proofs of claim; provided, that neither the
Agent nor any Senior Debt Holder shall have any obligation to execute, verify,
deliver or file such proof of claim.

 

(m)          No right of the Senior Debt Holders to enforce
subordination as herein provided shall at any time or in any way be affected or
impaired by any failure to act on the part of Payor or the Senior Debt Holders,
or by any noncompliance by Payor with any of the terms and provisions of this
Note, regardless of any knowledge thereof that the Senior Debt Holders may have
or be otherwise charged with.

 

5.             Subrogation.  Subject to the payment in full of all the Senior Debt (other than
contingent indemnity obligations) and termination of all commitments to extend
further financial accommodations under the Credit Agreement and until this Note
shall be paid in full, Holder shall be subrogated to the rights of the Senior
Debt Holders (to the extent of payments or distributions previously made to
such Senior Debt Holders pursuant to the provisions of Section 4
above) to receive payments or distributions of assets of Payor applicable to
the Senior Debt.  No such payments or
distributions applicable to the Senior Debt shall, as between Payor and its
creditors, other than the Senior Debt Holders and Holder, be deemed to be a
payment by Payor to or on account of this Note; and for the purposes of such
subrogation, no payments or 

4

 

distributions to the Senior Debt
Holders to which Holder would be entitled except for the provisions of this Section 5
shall, as between Payor and its creditors, other than the Senior Debt Holders
and Holder, be deemed to be a payment by Payor to or on account of the Senior
Debt.  If all or any part of any payment
to the Senior Debt Holders is recovered from or required to be repaid by any
Senior Debt Holder, then this Agreement shall be reinstated and any payment or
distribution to Holder at any time thereafter, whether pursuant to the right of
subrogation or otherwise, shall be deemed to have been received in trust for
the Senior Debt Holders and promptly paid to the Agent to be applied to the
Senior Debt.

 

6.             Usury
Savings Provision.  Under no
circumstances (and notwithstanding any other provisions of this Note) shall the
interest charged, collected, or contracted for on this Note exceed the maximum
rate permitted by law.  If any part of
this Note cannot be enforced, this fact will not affect the rest of this Note.

 

7.             Reimbursement
of Expenses.  If Holder
incurs any out-of-pocket expenses (including, without limitation, the fees and
expenses of Holder’s attorneys) in connection with the placement of this Note
in the hands of its attorneys for collection, or if this Note is collected
through any legal proceedings at law or in equity or in bankruptcy,
receivership or other court proceedings, then Payor shall pay to Holder, on
demand, all reasonable costs and expenses of collection, including, but not
limited to, court costs and reasonable attorneys’ fees.

 

8.             Notices. Any confirmation, notice or any other
communication provided for hereunder shall be in writing or by a
telecommunications device capable of creating a written record, and shall be
effective (a) upon personal delivery thereof, including without limitation, by
overnight mail and courier service or the United States mail, certified or
registered, postage prepaid, return receipt requested, or (b) in the case of
notice by such telecommunications device, when properly transmitted and
confirmed by telephone, addressed to the party to be noticed as follows:

 

If to Payor at:

 

                Westaff
(USA), Inc.

                P.O.
Box 9280

                Walnut
Creek, CA  94598

                Attention:  Treasurer

                Telecopier
No.: 925-930-5361

                Telephone
No.: 925-952-2502

 

                with
copies to:

 

                Westaff
(USA), Inc.

                P.O.
Box 9280

                Walnut
Creek, CA  94598

                Attention:  Chief Financial Officer

 

5

 

                Telecopier
No.: 925-934-5489

                Telephone
No.: 925-256-1518

 

                Westaff
(USA), Inc.

                P.O.
Box 9280

                Walnut
Creek, CA  94598

                Attention:
Legal Department

                Telecopier
No.: 925-937-0593

                Telephone
No.: 925-930-5349

 

        If to Holder at:

 

Mr.  Dwight S. Pedersen

c/o
Westaff (USA), Inc.

P.O.
Box 9280

Walnut
Creek, CA  94598

 

or to
such other address as either party may hereafter designate for itself by
written notice to the other party in the manner herein prescribed.

 

9.             Binding
Nature; Assignment.  This
Note and all of the provisions hereof shall be binding upon and inure to the
benefit of Payor and Holder and their respective successors and permitted
assigns, but neither this Note nor any of the rights, interests or obligations
hereunder shall be assigned or transferred by Payor without the prior written
consent of Holder.

 

10.           Amendments
and Waivers.

 

(a)           The Senior Debt and any Senior Obligations may be amended,
modified, increased, waived or extended, without notice to or consent of
Holder, and such amendment, modification, increase, waiver or extension shall
not change or modify the subordinated nature of this Note or Holder’s or
Payor’s obligations under Section 4 hereof.

 

(b)           Except as otherwise expressly provided herein, this Note
may not be amended or modified except by written instruments signed by the
Agent, Payor and Holder.  Each waiver or
consent under any provision hereof shall be effective only in the specific
instances for the purpose for which it is given.  Holder may delay or forego the enforcement of any of its rights
or remedies under this Note or any other document evidencing or securing this
Note without losing them.  Payor and any
other Person who signs, guarantees or endorses this Note, to the extent allowed
by law, waive presentment, demand for performance, notice of non-performance,
protest, notice of protest, notice of dishonor, notice of default, or any other
notice whatsoever.  Upon any change in
the terms of this Note in compliance with this Section 10 and
unless otherwise expressly stated in writing, no party who signs this Note,
whether as Payor, guarantor, accommodation Payor or endorser, shall be released
from liability.

 

 

6

 

11.           Applicable
Law.    THIS NOTE SHALL BE
GOVERNED BY, CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS
OF THE STATE OF CALIFORNIA WITHOUT GIVING EFFECT TO ANY CONFLICT OF LAWS,
PRINCIPLE OR RULE THAT MIGHT REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION.

 

12.           Waiver of
Jury Trial.  EACH OF THE
PARTIES HERETO WAIVES ITS RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS NOTE, IN ANY
ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE
PARTIES AGAINST ANY OTHER PARTY, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT
CLAIMS OR OTHERWISE.  EACH PARTY HERETO
AGREES THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL
WITHOUT A JURY.  WITHOUT LIMITING THE
FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY
JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR
OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR
ENFORCEABILITY OF THIS SUBORDINATION AGREEMENT OR ANY PROVISION HEREOF.  THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS SUBORDINATION
AGREEMENT.

 

13.   Definitions.

 

(a)           For the purposes of this Note, the terms below shall have
the following meanings:

 

“Agent” means General Electric Capital
Corporation, as agent for the Lenders under the Credit Agreement, and
its successors and assigns.

 

“Deed of Trust”
means that certain Deed of Trust, absolute Assignment of Leases and Rents,
Security Agreement and Fixture Filing, dated on or about May 16, 2002, made by
Westaff Support, Inc., as trustor, to Chicago Title Company, as trustee, for
the Benefit of Agent, as beneficiary.

 

“Lenders” means each of the financial
institutions party to the Credit Agreement.

 

“Credit Agreement” has the meaning set
forth in the introductory paragraph hereto.

 

“Senior Debt Holders” means the Agent and
the Lenders under the Credit Agreement and their respective successors,
participants and assigns, as permitted under the Credit Agreement.

 

7

 

“Senior Debt”
means all indebtedness and obligations now or hereafter existing or owed by
Payor to the Senior Debt Holders pursuant to the Credit Agreement or any
instruments or other documents executed by Payor with or in favor of the Senior
Debt Holders in connection therewith, as such agreements may be amended,
supplemented, replaced, refinanced or otherwise modified from time to time, and
whether for principal, premium, interest, fees, expenses, indemnities or
otherwise.

 

(b)           The meanings of defined terms are equally applicable to
the singular and plural forms of the defined terms.

 

(c)           Unless otherwise expressly provided
herein, references to agreements (including this Note) and other contractual
instruments shall be deemed to include all subsequent amendments. amendment and
restatements and other modifications thereto.

 

(d)           The words “hereof,” “hereto,”
“herein,” “hereunder” and similar words refer to this Note as a whole and not
to any particular provision of this Note; and Section and clause references are
to this Note unless otherwise specified.

 

(e)           The captions and headings of this
Note are for convenience of reference only and shall not affect the
interpretation of this Note.

 

[Signature Page to Follow]

 

8

 

IN WITNESS WHEREOF, Payor
has caused this Note to be duly executed by its officer hereunto authorized as
of the date first above written.

 

	
   

  	
  WESTAFF (USA), INC., a California corporation:

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dirk A. Sodestrom

  
	
   

  	
  Name: Dirk A. Sodestrom

  
	
   

  	
  Title:  
  Senior Vice President and Chief Financial Officer

  

 

The undersigned hereby
acknowledges and consents to the terms and conditions of the above Unsecured
Subordinated Note:

 

	
  /s/ Dwight S. Pedersen

  	
   

  
	
  Dwight S. Pedersen, an individual

  

 

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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

i

 

	 	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

ii

 

	 	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

iii

 

	 	

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

iv

  

        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. 

7

  

        "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

8

 

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. 

9

 

 
 

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. 

10

 

        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: 

11

 

        (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 

16

 

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 

17

 

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. 

18

 

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. 

19

 

        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. 

20

 

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 

21

 

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. 

22

   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 

23

 

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. 

24

 

        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 

25

 

        (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 

26

 

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. 

27

  

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 

28

 

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 

29

 

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 

30

 

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 

31

 

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 

32

 

        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 

33

  

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 

34

 

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 

35

 

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 

36

 

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 

37

 

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. 

39

  

        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. 

40

 

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 

41

 

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 

42

 

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 

43

 

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 

44

 

$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). 

45

  

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. 

46

 

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. 

47

 

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 

48

 

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. 

49

 
 
 

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. 

50

  

 
 

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: 

51

 

        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, 

52

 

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 

53

 

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 

54

 

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. 

55

  

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. 

56

 
 
 

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. 

57

 

        (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. 

58

 

        (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. 

59

 

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; 

60

 

        (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. 

61

  

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. 

62

 

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. 

63

 
 
 

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; 

64

 

        (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. 

65

 

        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: 

66

 

	 	 	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). 

67

   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. 

68

 

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. 

69

 

        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

70

  

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.] 

71

 
 
 

[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 

72

 

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.] 

73

  

 
 

[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. 

74

 

        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 

75

   [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. 

76

 

        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 

77

 

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. 

78

 

        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. 

79

 
	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. 

80

 

        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. 

81

  

 
 

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 

82

 
	(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. 

83

 

        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. 

85

 

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	
 	

 

86

 
 
 

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. 

88

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

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