Document:

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                                                                     EXHIBIT 4.3

                                OMNOVA SOLUTIONS
                             RETIREMENT SAVINGS PLAN

                           Effective December 1, 2000

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                                OMNOVA SOLUTIONS

                             RETIREMENT SAVINGS PLAN
                                TABLE OF CONTENTS

<TABLE>
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ARTICLE 1 -  DEFINITIONS..................................................................................1

        1.1         Account...............................................................................1
        1.2         Administrative Committee..............................................................1
        1.3         After-Tax Contribution................................................................1
        1.4         Basic Contribution....................................................................1
        1.5         Before-Tax Contribution...............................................................2
        1.6         Beneficiary...........................................................................2
        1.7         Benefits Management Committee.........................................................2
        1.8         Code..................................................................................2
        1.9         Company...............................................................................2
        1.10        Company Share.........................................................................2
        1.11        Compensation..........................................................................2
        1.12        Controlled Group......................................................................3
        1.13        Controlled Group Member...............................................................3
        1.14        Director..............................................................................3
        1.15        Disability............................................................................3
        1.16        Distribution Request..................................................................4
        1.17        Effective Date........................................................................4
        1.18        Eligible Employee.....................................................................4
        1.19        Employee..............................................................................4
        1.20        Employee Contribution.................................................................4
        1.21        Employer..............................................................................4
        1.22        Enrollment............................................................................4
        1.23        Enrollment Change.....................................................................5
        1.24        ERISA.................................................................................5
        1.25        GenCorp Stock Fund....................................................................5
        1.26        Highly Compensated Employee...........................................................5
        1.27        Investment Fund.......................................................................8
        1.28        Investment Manager....................................................................8
        1.29        Layoff Status.........................................................................8
        1.30        Leased Employee.......................................................................8
        1.31        Matching Contribution.................................................................9
        1.32        Member................................................................................9
        1.33        Monthly Valuation Date................................................................9
        1.34        OMNOVA Stock Fund.....................................................................9
        1.35        Plan..................................................................................9
</TABLE>

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                                              OMNOVA SOLUTIONS
                                          RETIREMENT SAVINGS PLAN
                                             TABLE OF CONTENTS
                                                  (cont.)
<TABLE>
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                1.36            Plan Share...........................................................................10
                1.37            Plan Year............................................................................10
                1.38            Qualified Plan.......................................................................10
                1.39            Rollover Contribution................................................................10
                1.40            Salary Deferral Agreement............................................................10
                1.41            Salary Reduction Agreement...........................................................10
                1.42            Supplemental Contribution............................................................11
                1.43            Supplemental Make-up Contribution....................................................11
                1.44            Trust Agreement......................................................................11
                1.45            Trust Fund...........................................................................11
                1.46            Trustee..............................................................................11
                1.47            Valuation Date.......................................................................11

        ARTICLE 2 - ELIGIBILITY, MEMBERSHIP AND ENROLLMENT...........................................................12

                2.1             Eligibility..........................................................................12
                2.2             Membership...........................................................................12
                2.3             Exclusion From Participation.........................................................12
                2.4             Termination of Employment............................................................13

        ARTICLE 3 - CONTINUOUS SERVICE...............................................................................14

                3.1             Continuous Service...................................................................14
                3.2             Service Definitions..................................................................14
                3.3             Special Rules........................................................................15
                3.4             Approved Leave of Absence............................................................15

        ARTICLE 4 - EMPLOYEE CONTRIBUTIONS...........................................................................16

                4.1             Amount of Employee Contributions.....................................................16
                4.2             Changes in Contributions.............................................................18
                4.3             Suspension and Resumption of Contributions...........................................18
                4.4             Reduction in Employee Contributions..................................................19
                4.5             Transfer and Allocation to Accounts..................................................19

</TABLE>

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                                OMNOVA SOLUTIONS
                             RETIREMENT SAVINGS PLAN
                                TABLE OF CONTENTS
                                     (cont.)
<TABLE>
<CAPTION>

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ARTICLE 5 - MATCHING CONTRIBUTIONS...........................................................................21

        5.1             Matching Contributions...............................................................21
        5.2             Amount and Form of Payments..........................................................21
        5.3             Time of Matching Contributions.......................................................22
        5.4             Allocation of Matching Contributions.................................................23
        5.5             Limitation on Transfer...............................................................23

ARTICLE 6 - TRUST FUND AND INVESTMENT FUNDS..................................................................23

        6.1             Trust Agreement......................................................................23
        6.2             The Trustee..........................................................................23
        6.3             Separate Investment Funds............................................................24
        6.4             Temporary Investment.................................................................24
        6.5             Investment Managers..................................................................24
        6.6             Payment of Expenses..................................................................25
        6.7             Use of Assets........................................................................26
        6.8             GenCorp Stock Fund...................................................................27

ARTICLE 7 - INVESTMENT OPTIONS AND ELECTIONS.................................................................27

        7.1             Investment Options...................................................................27
        7.2             Changes in Investment Funds..........................................................28
        7.3             Transfers............................................................................28
        7.4             Matching Contributions...............................................................29
        7.5             Accounts.............................................................................29
        7.6             Directions to Trustee................................................................30
        7.7             Member Responsibility for Selection of Funds.........................................30
        7.8             Voting and Tendering of Company Shares...............................................31
        7.9             GenCorp Stock Fund Accounts..........................................................33

ARTICLE 8 - VALUATION OF ASSETS AND PLAN SHARES..............................................................33

        8.1             Valuation of Assets..................................................................33
        8.2             Determination of Plan Share Values...................................................33
        8.3             Reporting of Plan Share Values.......................................................33
</TABLE>

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                                OMNOVA SOLUTIONS
                             RETIREMENT SAVINGS PLAN

                                TABLE OF CONTENTS
                                     (cont.)

<TABLE>
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        8.4             Adjustments to Member Accounts.......................................................34
        8.5             Values on Days other than Valuation Dates............................................34
        8.6             Statement of Accounts................................................................34

ARTICLE 9 - VESTING AND REPAYMENT............................................................................35

        9.1             Vesting of Interests.................................................................35
        9.2             Repayment of Contributions...........................................................36
        9.3             Unclaimed Distribution...............................................................37

ARTICLE 10 - DISTRIBUTIONS TO MEMBERS........................................................................37

        10.1            Regular Distributions................................................................37
        10.2            Hardship Distribution................................................................39
        10.3            Termination Distributions to Members.................................................41
        10.4            Time and Form of Distributions.......................................................41
        10.5            Reemployment of Member...............................................................42
        10.6            Direct Rollovers.....................................................................42
        10.7            Loans................................................................................44

ARTICLE 11 -            DISTRIBUTIONS TO BENEFICIARIES
                        AND ALTERNATE PAYEES.................................................................46

        11.1            Distributions to Beneficiaries.......................................................46
        11.2            Designation of Beneficiary...........................................................46
        11.3            Form and Time of Distribution........................................................47

ARTICLE 12 -            SPECIAL DISTRIBUTION PROVISIONS......................................................48

        12.1            Distribution Election................................................................48
        12.2            Mandatory Distribution...............................................................48
        12.3            Death of Member......................................................................48
        12.4            Death of Beneficiary.................................................................48
</TABLE>

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                                       OMNOVA SOLUTIONS
                                   RETIREMENT SAVINGS PLAN
                                       TABLE OF CONTENTS
                                             (cont.)

<TABLE>
<CAPTION>

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        12.5            Legal Capacity.......................................................................49
        12.6            Delayed Payment......................................................................49

ARTICLE 13 -            ADMINISTRATION OF THE PLAN...........................................................49

        13.1            Administrator........................................................................49
        13.2            Administrative Committee.............................................................49
        13.3            Benefits Management Committee........................................................50
        13.4            Named Fiduciaries....................................................................51
        13.5            Authority and Duties of Various Fiduciaries..........................................51
        13.6            Delegation...........................................................................54
        13.7            Multiple Capacities..................................................................54
        13.8            Compensation and Expenses of Fiduciaries.............................................55

ARTICLE 14 -            CLAIM PROCEDURES.....................................................................55

        14.1            Claim................................................................................55
        14.2            Initial Determination................................................................55
        14.3            Review...............................................................................56
        14.4            Effect of Decision...................................................................56

ARTICLE 15 -            ADOPTION OF PLAN BY CONTROLLED
                        GROUP MEMBERS........................................................................57

        15.1            Plan Adoption Procedure..............................................................57
        15.2            Effect of Plan Adoption..............................................................57

ARTICLE 16 -            AMENDMENT AND TERMINATION............................................................58

        16.1            Amendment............................................................................58
        16.2            Termination..........................................................................58

ARTICLE 17 -            CONSOLIDATION AND TRANSFER...........................................................59

        17.1            Consolidation........................................................................59
        17.2            Transfer.............................................................................59
        17.3            Preservation of Benefits.............................................................59
</TABLE>

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                                OMNOVA SOLUTIONS
                             RETIREMENT SAVINGS PLAN
                                TABLE OF CONTENTS
                                     (cont.)

<TABLE>
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ARTICLE 18 -            ADDITIONAL PROVISIONS................................................................60

ARTICLE 19 -            MISCELLANEOUS........................................................................60

        19.1            Benefits Payable from Trust Fund.....................................................60
        19.2            Payments for Exclusive Benefits of Members...........................................60
        19.3            Address of Record....................................................................60
        19.4            Elections............................................................................61
        19.5            No Right to Continued Employment.....................................................61
        19.6            No Assurance.........................................................................61
        19.7            Time of Action.......................................................................61
        19.8            Headings.............................................................................61
        19.9            Use of Masculine Terms...............................................................62
        19.10           Ohio Law to Govern...................................................................62
        19.11           Inalienability of Benefits and Interest..............................................62
        19.12           Severability.........................................................................63

ARTICLE 20 -            TERMS OF MERGERS OR CONSOLIDATIONS...................................................63

        20.1            Spin-Off From GenCorp Retirement Savings Plan........................................63
        20.2            Spin-Off From GenCorp Profit Sharing Plan............................................63
</TABLE>

                          LIST OF SCHEDULES AND APPENDICES
                          --------------------------------

SCHEDULE A -- CATEGORIES OF ELIGIBLE EMPLOYEES

SCHEDULE B -- INVESTMENT FUNDS AVAILABLE TO MEMBERS

APPENDIX A -- NONDISCRIMINATION REQUIREMENTS

APPENDIX B -- LIMITATIONS ON ALLOCATIONS

APPENDIX C -- TOP-HEAVY PROVISIONS

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                                OMNOVA SOLUTIONS
                             RETIREMENT SAVINGS PLAN
                             -----------------------

         This Plan is adopted by OMNOVA Solutions Inc. effective as of December
1, 2000 for the benefit of eligible Employees and their families. Between
October 1, 1999 and November 30, 2000, this Plan comprised part of the
GenCorp/OMNOVA Solutions Joint Retirement Savings Plan, a multiple employer plan
as described in Section 413(c) of the Internal Revenue Code. On December 1,
2000, Members' account balances in the GenCorp/OMNOVA Solutions Joint Retirement
Savings Plan, and corresponding assets, were spun-off as this separate Plan.

                                    Article 1

                                   Definitions
                                   -----------

         The following words as used in the Plan shall have the meanings set
forth in this Article 1 unless the context clearly implies otherwise. Certain
additional terms are defined in other provisions of the Plan.

         1.1 "ACCOUNT" means the records maintained hereunder to reflect the
amount and value of a Member's interest in the Trust Fund and each Investment
Fund, associated with Employee Contributions, Rollover Contributions, Matching
Contributions, distributions and investment earnings and results.

         1.2 "ADMINISTRATIVE COMMITTEE" means the Committee designated in
Section l3.2.

         1.3 "AFTER-TAX CONTRIBUTION" means a contribution which a Member may
elect to make to the Trust Fund from his Compensation after deduction of taxes.

         1.4 "BASIC CONTRIBUTION" means any Employee Contribution by or for a
Member for a Plan Year which is not in excess of six percent of the Member's
Compensation for the Plan Year.

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         1.5 "BEFORE-TAX CONTRIBUTION" means an Employer contribution to the
Trust Fund that is allocated to a Member's Account pursuant to a Salary
Reduction Agreement.

         1.6 "BENEFICIARY" means the one or more persons or entities designated
pursuant to Section 11.2 or otherwise entitled to receive a distribution of a
Member's interest in the Plan if he dies.

         1.7 "BENEFITS MANAGEMENT COMMITTEE" means the Committee designated in
Section 13.3.

         1.8 "CODE" means the Internal Revenue Code of 1986, as amended from
time to time.

         1.9 "COMPANY" means OMNOVA Solutions Inc., an Ohio corporation.

         1.10 "COMPANY SHARE" means a share of the voting common stock of the
Company.

         1.11 "COMPENSATION" means the amount of regular wages or base salary,
cash bonuses, commissions, and pay for overtime work, which an Employer actually
pays (or would have paid but for a Salary Reduction Agreement or Salary Deferral
Agreement) to a Member during a Plan Year, but excludes (a) any other amount
paid under an employment agreement or employee benefit or compensation plan
unless such agreement or plan expressly provides that such amount shall be
included in Compensation for purposes of this Plan and is approved by the
Administrative Committee, and (b) any amount which is earned but payment of
which is deferred by election of a Member or otherwise, except pursuant to a
Salary Reduction Agreement or Salary Deferral Agreement.

         The annual compensation of a Member for a Plan Year which is taken into
account for any purpose shall not exceed $160,000, as adjusted in regulations
prescribed by the Secretary of the Treasury. In determining the compensation of
a Member for purposes of this limitation, the

                                       2
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rules of Code section 414(q)(6) shall apply except that, in applying such rules,
the term "family" shall include only the spouse of the Member and any lineal
descendants of the Member who have not attained age 19 before the close of the
year. If, as a result of the application of such rules the adjusted annual
compensation limitation is exceeded, then (except for purposes of determining
the portion of compensation up to the integration level if this plan provides
for permitted disparity), the limitation shall be prorated among the affected
individuals in proportion to each such individual's compensation as determined
under this section prior to the application of this limitation.

         1.12 "CONTROLLED GROUP" means the Company and any and all (a)
corporations (50% or more of whose voting stock is owned or controlled by the
Company, directly or indirectly) and (b) unincorporated trades and businesses
owned or controlled by the Company, directly or indirectly, and the employees of
which, together with employees of the Company, are required to be treated as
employees of a single employer under Code Section 414, including regulations
prescribed by the Secretary of the Treasury thereunder.

         1.13 "CONTROLLED GROUP MEMBER" means each corporation or unincorporated
trade or business that is or was a member of the Controlled Group, but only
during such period as it is or was such a member.

         1.14 "DIRECTOR" means each and every person who serves as a director of
the Company.

         1.15 "DISABILITY" means the inability of a Member to perform the duties
assigned to him by an Employer for an extended period of time due to a mental or
physical condition. The determination of a Member's Disability shall be made by
the Company after receiving competent

                                       3
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medical advice by a physician satisfactory to the Company and independent of a
determination of Disability under any other employee benefit plan maintained by
any Controlled Group Member.

         1.16 "DISTRIBUTION REQUEST" means the form prescribed by the Company
for use by a

         1.17 "EFFECTIVE DATE" means December 1, 2000, the first day on which
the Plan becomes effective.

         1.18 "ELIGIBLE EMPLOYEE" means an Employee who is in a category of
Employees designated as Eligible Employees on Schedule A, attached hereto and
made a part hereof, and not excluded under Section 2.3.

         1.19 "EMPLOYEE" means any person who is employed by any Controlled
Group Member including: (a) an Employee who is in Layoff Status; (b) a Leased
Employee, but only for purposes of the requirements of Code section 414(n)(3);
and (c) individuals who are treated as Employees of an Employer pursuant to
regulations under Code section 414(o).

         1.20 "EMPLOYEE CONTRIBUTION" means each and all of a Member's After-Tax
Contributions and the Employer contributions allocated to the Member's Account
as Before-Tax Contributions. For purposes of this Plan, an Employee Contribution
made "for" a Member refers to the allocation by the Trustee of Employer
contributions to the Member's Account as Before-Tax Contributions, rather than
to the payment of such Employer contributions to the Trust Fund.

         1.21 "EMPLOYER" means any Controlled Group Member which adopts the Plan
with the Company's consent.

         1.22 "ENROLLMENT" means the procedures, including a telephone
voice-response system, prescribed by the Company for use in connection with
enrollment of Members in the Plan.

                                       4
<PAGE>   12

         1.23 "ENROLLMENT CHANGE" means the use of the Enrollment process by a
Member to request (i) a change in his rate of contributions in accordance with
Section 4.2; (ii) suspension of his contributions in accordance with Section
4.3(a); (iii) a change in his election of investment options in accordance with
Section 7.2; or (iv) a transfer between Investment Funds in accordance with
Section 7.3.

         1.24 "ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time.

         1.25 "GENCORP STOCK FUND" means one of the Investment Funds, the assets
of which shall consist primarily of shares of common stock of GenCorp Inc.

         1.26. "HIGHLY COMPENSATED EMPLOYEE" means a "highly compensated active
employee" or a "highly compensated former employee" as determined below. For
purposes of this Section 1.26 the determination year shall be the Plan Year. The
look-back year shall be the twelve-month period immediately preceding the
determination year.

                  (a)(1) The term "highly compensated active employee" includes
                  any Employee who performs service for an Employer during the
                  determination year and who, during the look-back year:
                  (i)      received Compensation from the Employer in excess of
                           $75,000 (as adjusted pursuant to Code section
                           415(d));

                  (ii)     received Compensation from the Employer in excess of
                           $50,000 (as adjusted pursuant to Code section 415(d))
                           and was a member of the top-paid group for such year.
                           An Employee is in the top-paid group of Employees for
                           any Plan Year if such Employee is in the group
                           consisting

                                       5
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                           of the top 20 percent of the Employees when ranked on
                           the basis of Compensation paid during the Plan Year.
                           For purposes of determining the number of Employees
                           in the top-paid group, Employees described in Code
                           section 414(q)(8) and the regulations thereunder
                           shall be excluded; or

                  (iii)    was an officer of the Employer and received
                           Compensation during such year that is greater than 50
                           percent of the dollar limitation in effect under code
                           section 415(b)(1)(A). If no officer has satisfied the
                           compensation requirement of this subparagraph (iii)
                           during either a determination year or look-back year,
                           the highest paid officer for such year shall be
                           treated as a Highly Compensated Employee, unless
                           provided otherwise by regulations. The number of
                           officers who are treated as Highly Compensated
                           Employees for such year shall be limited to fifty
                           (50) or, if lesser, the greater of three (3)
                           Employees or 10 percent of the Employees, excluding
                           those Employees who may be excluded in determining
                           the top-paid group. In determining an individual's
                           Compensation under this Section, Compensation from
                           each Employer required to be aggregated under Code
                           sections 414(b),(c),(m) and (o) will be taken into
                           account. For purposes of this section, the
                           determination of Compensation will be made in
                           accordance with Code section 415(c)(3) and without
                           regard to Code sections 125, 401(e)(3), 401(h)(1)(B)
                           and, in the case of Employer contributions made
                           pursuant to a salary reduction agreement, without

                                       6
<PAGE>   14

                           regard to Code section 403(b).

                  (2) The term Highly Compensated Employee also includes: (i)
                  Employees who are both described in the preceding sentence if
                  the term "determination year" is substituted for the term
                  "look-back year" and the Employee is one of the 100 Employees
                  who received the most Compensation from an Employer during the
                  determination year; and (ii) Employees who are 5 percent
                  owners at any time during the look-back year or determination
                  year.

                  (b) The term "highly compensated former employee" includes any
         Employee who separated from service (or was deemed to have separated)
         prior to the determination year, performs no service for the Employer
         during the determination year, and was a highly compensated active
         employee for either the separation year or any determination year
         ending on or after the Employee's 55th birthday.

                  (c) If an Employee is, during a determination year or
         look-back year, a family member of either a 5 percent owner who is an
         active or former Employee or a Highly Compensated Employee who is one
         of the 10 most highly compensated employees ranked on the basis of
         Compensation paid by an Employer during such year, then the family
         member and the 5 percent owner or top-ten Highly Compensated Employee
         shall be aggregated. In such case, the family member and 5 percent
         owner or top-ten Highly Compensated Employee shall be treated as a
         single Employee receiving Compensation and plan contributions or
         benefits equal to the sum of such Compensation and contributions or
         benefits of the family member and 5 percent owner or top-ten Highly

                                       7
<PAGE>   15

         Compensated Employee. For purposes of this section, family member
         includes the spouse, lineal ascendants and descendants of the Employee
         or former Employee and the spouses of such lineal ascendants and
         descendants.

                  (d) The determination of who is a Highly Compensated Employee,
         including the determinations of the number and identity of Employees in
         the top-paid group, the top 100 Employees, the number of Employees
         treated as officers and the Compensation that is considered, will be
         made in accordance with Code section 414(q) and the regulations
         thereunder.

         1.27 "INVESTMENT FUND" means each and every fund described in Section
6.3.

         1.28 "INVESTMENT MANAGER" means any person who the Benefits Management
Committee designates pursuant to Section 6.5 and is either a registered
investment advisor, bank or insurance company as described in ERISA section
3(38).

         1.29 "LAYOFF STATUS" means the status of an Employee during the period
of time when he is laid off and ceases active work due to curtailment or
reduction in force and ends upon his return to work or, if earlier, one year
from the date of layoff.

         1.30 "LEASED EMPLOYEE" means any person (other than an employee of the
recipient) who pursuant to an agreement between the recipient and any other
person ("leasing organization") has performed services for the recipient (or for
the recipient and related persons determined in accordance with Code section
414(n)(6) on a substantially full time basis for a period of at least one year,
and such services are of a type historically performed by employees in the
business field of the recipient employer. Contributions or benefits provided to
a Leased

                                       8
<PAGE>   16

Employee by the leasing organization which are attributable to services
performed for the recipient employer shall be treated as provided by the
recipient employer.

A Leased Employee shall not be considered an Employee of the recipient if: (i)
such employee is covered by a money purchase pension plan providing: (1) a
nonintegrated employer contribution rate of at least 10 percent of compensation,
as defined in Code section 415(c)(3), but including amounts contributed pursuant
to a salary reduction agreement which are excludable from the employee's gross
income under Code sections 125, 402(e)(3), 402(h)(1)(B) or 403(b), (2) immediate
participation, and (3) full and immediate vesting; and (ii) Leased Employees do
not constitute more than 20 percent of the recipient's nonhighly compensated
workforce.

         1.31 "MATCHING CONTRIBUTION" means the Employer contributions which are
allocated to the GenCorp Stock Fund for the benefit of Members pursuant to
Section 5.1.

         1.32 "MEMBER" means a person (a) who is eligible to participate in the
Plan under Article 2 and is making Employee Contributions to the Plan, or (b)
who is no longer making Employee Contributions to the Plan but still has Plan
Shares credited to his Account in the Trust Fund.

         1.33 "MONTHLY VALUATION DATE" means the last day of each calendar
month.

         1.34 "OMNOVA Stock Fund" means one of the Investment Funds, the assets
of which shall consist primarily of Company Shares.

         1.35 "PLAN" means the OMNOVA Solutions Retirement Savings Plan, the
terms of which are set forth herein, and the Trust Agreement, as amended or
restated from time to time.

                                       9
<PAGE>   17

         1.36 "PLAN SHARE" means each and every share or unit of value credited
to a Member's Account under the Plan, representing his proportionate interest in
each Investment Fund and the Trust Fund.

         1.37 "PLAN YEAR" means each and every regularly recurring period of
twelve consecutive calendar months, beginning on November 1 and ending on
October 31, or portion thereof, during which the Plan is in effect.

         1.38 "QUALIFIED PLAN" means an employee benefit plan that is qualified
under Code section 401(a).

         1.39 "ROLLOVER CONTRIBUTION" means the contribution which a Member may
elect to make to the Trust Fund pursuant to Section 4.1(d).

         1.40 "SALARY DEFERRAL AGREEMENT" means an arrangement pursuant to which
a Member may elect to decrease, or to forego an increase in, the amount of his
Compensation which his Employer otherwise would have paid to him in cash, and
have an equal amount (i) applied to obtain additional benefits under a cafeteria
benefits plan (as defined in Code section l25) maintained by his Employer or
(ii) allocated to his Account under a qualified cash or deferred arrangement (as
defined in Code section 40l(k)) maintained by his Employer.

         1.41 "SALARY REDUCTION AGREEMENT" means an arrangement made under the
Plan pursuant to which a Member agrees to reduce, or to forego an increase in,
the amount of his Compensation paid directly to him in return for an allocation
of Employer contributions in an equal amount to the Member's Account.

                                       10
<PAGE>   18

         1.42 "SUPPLEMENTAL CONTRIBUTION" means any Employee Contribution by or
for a Member for a Plan Year that is in excess of six percent of the Member's
Compensation for the Plan Year.

         1.43 "SUPPLEMENTAL MAKE-UP CONTRIBUTION" means a contribution which a
Member may elect to make to the Trust Fund pursuant to Section 4.l(b) to make-up
Supplemental Contributions that he could have made but did not make in a prior
period of time.

         1.44 "TRUST AGREEMENT" means the agreement or agreements executed by
the Company and the Trustee which establishes a Trust Fund for investment,
reinvestment, administration and distribution of contributions made under the
Plan, and the earnings thereon, as amended from time to time.

         1.45 "TRUST FUND" means each and all of the assets of the Plan held by
the Trustee pursuant to the Trust Agreement.

         1.46 "TRUSTEE" means the person who has entered into the Trust
Agreement as Trustee and any person who is appointed as successor and becomes a
party to the Trust Agreement.

         1.47 "VALUATION DATE" means every day except (a) Saturdays and Sundays;
(b) New Year's Day, Presidents Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day, Christmas Day and any other day on which the New
York Stock Exchange is not open for trading; (c) the business day falling
immediately before (i) Martin Luther King, Jr. Day, (ii) Columbus Day, (iii)
Veterans Day and (iv) any other day on which the New York Stock Exchange is open
for trading but the federal wire system for banking is closed; and (d) any day
on which the Trustee, for reasons beyond its control, is unable to determine the
total fair market value of assets held by it in any Investment Fund.

                                       11
<PAGE>   19

                                    Article 2

                     Eligibility, Membership and Enrollment
                     --------------------------------------

         2.1 ELIGIBILITY. Each Employee who is in one of the categories of
Eligible Employees now or hereafter set forth in Schedule A and is not excluded
under Section 2.3 is eligible to participate in the Plan as a Member on and
subject to the terms of the Plan. The Company will notify each Eligible Employee
of his eligibility to participate in the Plan.

         2.2 MEMBERSHIP. By completing Enrollment in the Plan in accordance with
procedures established by the Company, each Eligible Employee may commence
participation in the Plan as of the first day of the first payroll period
commencing after such Enrollment.

         2.3      EXCLUSION FROM PARTICIPATION.

                  (a) INELIGIBLE EMPLOYEES. No Employee can become an Eligible
         Employee, and no Member may continue to make or have made for him any
         Employee Contributions, if (i) he is not or ceases to be in a category
         of Eligible Employees set forth in Schedule A, (ii) he is employed in a
         collective bargaining unit and represented by a recognized collective
         bargaining agent, unless (x) he is covered by a collective bargaining
         agreement expressly providing for participation in the Plan, (y) such
         agent has not had the opportunity to bargain in respect of such
         participation, or (z) his Employer has a good faith bargaining
         obligation to continue such participation during any period of good
         faith bargaining with such agent; (iii) he is a nonresident alien who
         receives no earned income (within the meaning of Code section
         9ll(d)(2)) from an Employer which constitutes income from sources
         within the United States (within the meaning of Code section

                                       12
<PAGE>   20

         86l(a)(3)); (iv) he is considered to be an Employee solely because he
         is a Leased Employee, or he is performing services for an Employer
         pursuant to an agreement between the Employer and a leasing
         organization but he is not a Leased Employee; (v) he is an individual
         treated as an Employee of an Employer pursuant to regulations under
         Code section 4l4(o); (vi) he is employed by a Controlled Group Member
         or an organizational unit thereof that has not been designated
         hereunder as an Employer; or (viii) he is then on an authorized leave
         of absence, in Layoff Status or in the full-time service of the armed
         forces of the United States.

                  (b) EXCLUSION AFTER PARTICIPATION. A Member who becomes
         ineligible to participate under Section 2.3(a) but remains in the
         employ of a Controlled Group Member will not be eligible to make or
         have made for him any Employee Contributions or Rollover Contributions
         during or in respect of any such period of ineligibility.

                  (c) LAPSE OF EXCLUSION. A Member who becomes ineligible to
         participate under Section 2.3(a) but remains in the employ of a
         Controlled Group Member will become eligible to participate in the Plan
         on the first day after he no longer is described in Section 2.3(a) and
         may resume making or having made for him any Employee Contributions as
         of the first day of a subsequent payroll period by completing
         Enrollment as provided in Section 2.2.

         2.4 TERMINATION OF EMPLOYMENT. A Member may continue to be a Member
(but may not make Rollover Contributions or make or have made for him any
Employee Contributions) after his Termination of Employment Date until all Plan
Shares credited to his Account have been distributed pursuant to the Plan.

                                       13
<PAGE>   21

                                    Article 3
                               Continuous Service
                               ------------------

         3.1 CONTINUOUS SERVICE. The term "Continuous Service" means one or more
periods of time beginning on an Employment Commencement Date of an Employee and
ending on the first subsequent Termination of Employment Date of the same
Employee. Nonconsecutive periods of Continuous Service shall be aggregated and
three hundred sixty-five (365) days of service shall equal a whole year of
service (computed to the nearest one-twelfth thereof).

         3.2 SERVICE DEFINITIONS. The following terms as used in this Plan shall
have the meanings set forth in this Section 3.2:

                  (a) "EMPLOYMENT COMMENCEMENT DATE" means the day on which an
         Employee first performs an Hour of Service and commences a period of
         Continuous Service.

                  (b) "BREAK IN SERVICE" means the period following a
         Termination of Employment Date extending until the Employee again
         completes an Hour of Service.

                  (c) "HOUR OF SERVICE" means an hour for which an Employee is
         paid or entitled to payment by a Controlled Group Member for the
         performance of duties.

                  (d) "TERMINATION OF EMPLOYMENT DATE" means the earlier of (l)
         the day on which an Employee ceases to be in the employ of a Controlled
         Group Member because he quits, is discharged, retires or dies, or (2)
         the first anniversary of the day on which an Employee commenced an
         authorized leave of absence is placed on Layoff Status or is absent
         from work for any other reason, with or without pay, unless he returns
         to work by

                                       14
<PAGE>   22

         such anniversary; provided that, for purposes of Section 10.3, a Member
         who is placed on Layoff Status will be deemed to have incurred a
         Termination of Employment Date at the time of layoff.

         3.3 SPECIAL RULES. Section 3.2(d) notwithstanding, the special rules
set forth below will apply in determining Continuous Service and Termination of
Employment Dates for the following Employees:

                  (a) MILITARY SERVICE. If an Employee is absent from the
         service of a Controlled Group Member because of service in the armed
         forces of the United States and is returned to the service of a
         Controlled Group Member within the period during which reemployment
         rights are extended by law, such period of absence shall be included in
         his Continuous Service.

                  (b) PREGNANCY. If an Employee is absent from the service of a
         Controlled Group Member due to the Employee's pregnancy, birth or
         adoption of a child by the Employee, or caring for his new-born or
         newly adopted child and returns to the employment of the Controlled
         Group Member by the second anniversary of the period of such absence,
         the period of such absence ending on the first anniversary of the birth
         or adoption of the child will be included in the Employee's Continuous
         Service, and the period of such absence ending after the first but
         before the second such anniversary will be deemed as neither Continuous
         Service nor a Break in Service.

         3.4 APPROVED LEAVE OF ABSENCE. A period during which an Employee is on
a leave of absence approved by a Controlled Group Member and is not otherwise
included in Continuous Service shall, if the Administrative Committee so
determines, be so included under rules

                                       15
<PAGE>   23

established by the Administrative Committee uniformly applicable to all
Employees similarly situated.

                                    Article 4

                             Employee Contributions
                             ----------------------

         4.1 AMOUNT OF EMPLOYEE CONTRIBUTIONS.

                  (a) EMPLOYEE CONTRIBUTIONS. Upon enrollment pursuant to
         Section 2.2, a Member will elect (i) to make After-Tax Contributions of
         a designated percentage of his Compensation (in l% increments) through
         payroll deductions and/or (ii) to have his Employer's contributions
         allocated to his Account as Before-Tax Contributions in the amount of
         the reduction in his Compensation (in l% increments) pursuant to a
         Salary Reduction Agreement.

                           (1) Aggregate Employee Contributions by or for a
                  Member for a Plan Year up to an amount equal to six percent of
                  the Member's Compensation for the Plan Year shall be
                  considered Basic Contributions.

                           (2) The aggregate amount of Employee Contributions by
                  or for a Member for a Plan Year may not exceed 16% of the
                  Member's Compensation for the Plan Year.

                  (b) SUPPLEMENTAL MAKE-UP CONTRIBUTIONS. Subject to Section
         2.3(b) and Section 4.3, a Member who has not contributed the maximum
         amount of Supplemental Contributions which he was entitled to
         contribute under the Plan during any period of his employment
         thereafter may make Supplemental Make-up Contributions, by a single-sum

                                       16
<PAGE>   24

         cash payment, in an amount equal to the difference between the actual
         amount of Supplemental Contributions that he previously made and the
         maximum amount of Supplemental Contributions that he could have made
         during the relevant period or periods, subject to the following three
         limitations:

                           (i) First, no amount may be contributed which would
                  cause his Account to exceed applicable limitations on Annual
                  Additions for any year as defined in Appendix B or any other
                  limitation under Appendix A.

                           (ii) Second, no Supplemental Make-up Contribution may
                  be made on a before-tax basis pursuant to a Salary Reduction
                  Agreement or otherwise.

                           (iii) Third, after making a Supplemental Make-up
                  Contribution for any period, a Member thereafter can make no
                  Supplemental Make-up Contribution for the same or any prior
                  period.

                  (c) ROLLOVER CONTRIBUTIONS. A Member who is entitled to (i) a
         lump-sum distribution from (A) a Qualified Plan maintained by a
         previous employer, (B) an annuity contract qualified under Code section
         403, or (C) a Keogh plan defined in Code section 401(c), or (ii) one or
         more distributions within one taxable year of a Member on account of
         the termination of a Qualified Plan of an Employer, may rollover and
         contribute to the Trust Fund a Rollover Contribution equal to all or
         part of such lump-sum distribution or, if applicable, the aggregate
         distributions upon termination of a Qualified Plan of an Employer, less
         any amount thereof that represents the Member's after-tax contributions
         to such prior plan. Notwithstanding the preceding sentence, if the
         Administrative Committee determines that such distribution could
         jeopardize the qualified status of the

                                       17
<PAGE>   25

         Plan, the exempt status of the Trust Fund, or otherwise create adverse
         tax consequences for an Employer if rolled over to this Plan, the
         Administrative Committee shall have the authority to refuse to accept
         such a distribution as a Rollover Contribution under the Plan. The
         Administrative Committee shall have the right to require that the
         Member seeking to roll a distribution to this Plan provide sufficient
         evidence that the rollover contribution is from an arrangement
         described in Section 4.1(c)(i) or (ii) above. In the event that the
         Member is unable or unwilling to provide such evidence, the
         Administrative Committee shall have the authority to refuse to accept
         such a distribution as a Rollover Contribution under this Plan.

         4.2 CHANGES IN CONTRIBUTIONS. The percentage of Compensation which a
Member elects to contribute or have allocated to his Account pursuant to Section
4.1(a) shall continue in effect, notwithstanding any changes in his
Compensation, until he completes an Enrollment Change in accordance with the
following sentence. Subject to the percentage permitted by Section 4.1(a), a
Member may change the rate of deferral under his Salary Reduction Agreement
and/or the rate of his After-Tax Contributions by completing an Enrollment
Change directing a change in his contributions, and such change will be
effective as of the first day of the first payroll period immediately following
his Enrollment Change.

         4.3 SUSPENSION AND RESUMPTION OF CONTRIBUTIONS.

                  (a) SUSPENSION OF EMPLOYEE CONTRIBUTIONS. A Member may cause
         all or any of his After-Tax Contributions and all or any deferrals
         pursuant to a Salary Reduction Agreement to be suspended, effective as
         of the first day of the first payroll period after he completes an
         Enrollment Change directing the suspension of his contributions or
         salary

                                       18
<PAGE>   26

         deferrals. Thereafter, such Member may cause Employee Contributions to
         resume by completing Enrollment as provided in Section 2.2. A Member
         may not make up any Basic Contributions that were so suspended.

                  (b) SUSPENSION WHILE INELIGIBLE. No Employee Contributions or
         Rollover Contributions may occur with respect to a Member after he
         becomes ineligible under Section 2.3. If such Member thereafter becomes
         an Eligible Employee, he will become eligible to participate and may
         enroll for participation as provided in Section 2.2, but may not make
         any Supplemental Make-up Contributions in respect of such period of
         ineligibility.

         4.4 REDUCTION IN EMPLOYEE CONTRIBUTIONS. Other provisions hereof
notwithstanding, an Employer may reduce any or all Employee Contributions if any
reduction thereof is permitted or required under Appendix A or applicable
provision of law.

         4.5 TRANSFER AND ALLOCATION TO ACCOUNTS.

                  (a) BEFORE TAX CONTRIBUTIONS. Each Member's Employer shall
         contribute to the Plan in any given Plan Year sufficient amounts to
         fund the allocations described in Section 4.1(a)(ii). These Employer
         contributions may be made in one or more installments at any time
         during the Plan Year in which such contributions are properly
         allocable, but in no event later than the time the corresponding
         reduction in the Member's Compensation would be considered assets of
         the Plan under U.S. Department of Labor Regulation Section 2510.3-102.
         Amounts contributed by an Employer pursuant to this Section 4.5(a) that
         are not immediately allocable to a Member's Account as Before-Tax
         Contributions shall be invested separately pursuant to Section 6.5 and
         such amounts,

                                       19
<PAGE>   27

         adjusted for any gains, losses, income and deductions, shall be applied
         to reduce Employer contributions otherwise required under the Plan.
         Contributions by or on behalf of an Employer for any taxable year of an
         Employer shall not exceed the maximum amount allowable as a deduction
         to the Employer under the provisions of Section 404 of the Code.

                  (b) OTHER CONTRIBUTIONS. Except as provided in Section 9.2,
         After-Tax Contributions (except Supplemental Make-up Contributions)
         will be made only through payroll deductions from Compensation each pay
         period. After-Tax Contributions, Supplemental Make-up Contributions,
         and Rollover Contributions shall be transmitted to the Trustee as soon
         as practicable, but not later than the time such contributions would be
         considered assets of the Plan under U.S. Department of Labor Regulation
         Section 2510.3-102.

                  (c) INVESTMENTS. All allocations to the Investment Fund or
         Funds selected by a Member under Section 6.3, insofar as the
         allocations relate to Employee Contributions for a given pay period and
         Rollover Contributions, shall occur as soon as practicable after the
         contributions are allocated to Members' Accounts. Each Member's Account
         shall be credited with the number of Plan Shares determined by dividing
         the amount allocated to his Account with respect to his Employee
         Contributions and Rollover Contributions, if any, by the Plan Share
         value of the applicable Investment Fund as of the date such
         contributions are allocated to the selected Investment Fund or Funds.

                                       20
<PAGE>   28

                                    Article 5

                             Matching Contributions
                             ----------------------

         5.1 MATCHING CONTRIBUTIONS. Subject to the provisions of the Plan and
applicable law, amounts will be allocated as Matching Contributions to the
Accounts of each Member who makes or for whom are made Basic Contributions as
provided in Section 4.1(a) as set forth below:

         (a)      SALARIED MEMBERS: An amount equal to the sum of (i) l00% of
                  the first 3% of Compensation contributed or deferred by each
                  Member and (ii) 50% of the next 3% of Compensation contributed
                  or deferred by each Member.

         (b)      MEMBERS OF INTERNATIONAL CHEMICAL WORKERS' UNION LOCAL 419
                  (MOGADORE, OHIO): An amount equal to 25% of the first 6% of
                  Compensation contributed or deferred by each Member.

         (c)      MEMBERS OF LOCAL 1876, UNION OF NEEDLETRADES, INDUSTRIAL AND
                  TEXTILE EMPLOYEES, AFL-CIO-CLC, CALHOUN, GA: An amount equal
                  to 50% of the first 6% of Compensation contributed or deferred
                  by each Member.

         (d)      MEMBERS OF LOCAL 748, UNITED STEELWORKERS OF AMERICA
                  (COLUMBUS, MS): No Matching Contribution.

         5.2 AMOUNT AND FORM OF PAYMENTS. Each Employer will pay to the Trust
Fund an amount at least equal to the aggregate amount required to be allocated
to each of its Members as Matching Contributions for a pay period pursuant to
Section 5.1 (less an amount equal to the interests of each Member in its employ
in any Matching Contributions permitted or required to be forfeited during the
same pay period hereunder or any applicable law). Additionally, all

                                       21
<PAGE>   29

contributions allocable as Matching Contributions shall be made in cash, except
that in lieu of cash, the Company may deliver that number of Company Shares
having an aggregate market value equal to that part of any Employer
contributions allocable as Matching Contributions not paid in cash. For this
purpose, the value of a Company Share delivered or allocated in respect of a
payroll period shall be the average of the high and low trading prices reported
in the New York Stock Exchange Composite Transactions section of the Wall Street
Journal (A) for the payroll disbursement date of the PAYROLL period if such date
falls on (i) a Friday, (ii) the 15th day of a month or (iii) the last day of a
month, and (B) if the payroll disbursement date of the payroll period falls on
any other day, for the Friday immediately following such date. If, for any
reason, no trading of Company Shares on the New York Stock Exchange occurs on a
payroll disbursement date (or, as applicable, a Friday immediately following
such date), trading prices on the last preceding trading day shall be used for
purposes of the preceding sentence.

         5.3 TIME OF MATCHING CONTRIBUTIONS. Employer contributions made under
this Article 5 shall be paid to the Trustee in one or more installments at any
time on or after the first day of the Plan Year in which such contributions are
properly allocable, provided sufficient contributions have been paid or
delivered to the Trustee to fund allocations as they are credited pursuant to
Section 5.4. Although contributions allocable as Matching Contributions may be
made earlier than this time in a given Plan Year, such contributions shall be
transmitted to the Trustee no later than 30 days after the end of the calendar
month in which ends the pay period for which the corresponding Basic
Contributions are withheld or allocated. All Matching Contributions made under
this Article 5 shall be deemed to have been made in the same Plan Year as the
Basic Contributions corresponding thereto.

                                       22
<PAGE>   30

         5.4 ALLOCATION OF MATCHING CONTRIBUTIONS. All contributions allocated
as Matching Contributions shall be directed to the OMNOVA Stock Fund as soon as
practicable after allocation by the Trustee. Allocations of amounts as Matching
Contributions shall be made by crediting the Member's Account with the number of
Plan Shares in the OMNOVA Stock Fund determined by dividing the amount of
Matching Contributions credited to this Account by the Plan Share value for the
OMNOVA Stock Fund as of the date such Matching Contributions are allocated to
the OMNOVA Stock Fund. Any Employer contributions pursuant to this Article 5
that are not immediately allocable shall be invested separately pursuant to
Section 6.5 and such amounts, adjusted for any gains, losses, income and
deductions, shall be applied to reduce Employer contributions otherwise required
under the Plan.

         5.5 LIMITATION ON TRANSFER. A Member may not transfer from the OMNOVA
Stock Fund any Matching Contributions made for his benefit and credited to his
Account.

                                    Article 6

                         Trust Fund and Investment Funds
                         -------------------------------

         6.1 TRUST AGREEMENT. The Company shall enter into a Trust Agreement
which shall be a part of the Plan. Any or all rights or benefits accruing to any
person under the Plan with respect to any Employee Contributions, Rollover
Contributions and Matching Contributions deposited under the Trust Agreement
shall be subject to all provisions of the Trust Agreement.

         6.2 THE TRUSTEE. The Benefits Management Committee shall appoint the
Trustee and any successor Trustee to serve at its pleasure. The Trustee may hold
the Trust Fund as part of a

                                       23
<PAGE>   31

master trust comprising assets of various qualified plans maintained by the
Company or any Employer.

         6.3 SEPARATE INVESTMENT FUNDS. The Trustee will maintain initially as
separate Investment Funds within the Trust the Diversified Equity Fund, OMNOVA
Stock Fund, Interest Income Fund, Balanced Fund, International Equity Fund,
Diversified Bond Fund, Short-Term Investment Fund, and a closed GenCorp Stock
Fund (as described in Schedule B), and as many separate Investment Funds, each
with different investment objectives, as the Benefits Management Committee deems
advisable. Such Investment Funds and related investment objectives may be added
or deleted as the Benefits Management Committee so determines and as described
in one or more amendments to Schedule B. Each Investment Fund may be part of a
fund with the same investment objectives maintained by the Trustee for the
benefit of participants in other qualified plans maintained by the Company or an
Employer or may be a separate fund maintained only for the benefit of Members of
this Plan. Earnings or gains derived from the assets of any Investment Fund will
be invested and reinvested in that Fund.

         6.4 TEMPORARY INVESTMENT. In accordance with applicable investment
objectives, guidelines and policies, the Trustee temporarily may make short-term
investments in obligations issued or guaranteed by the United States Government,
commercial paper, an interim investment fund for tax qualified employee benefit
plans established by the Trustee unless otherwise provided by applicable law, or
other investments of a short-term nature and may hold some portion of each
Investment Fund in cash.

         6.5 INVESTMENT MANAGERS. All contributions to the Trust Fund and each
Investment Fund and earnings thereon will be invested (a) by the Trustee alone
or (b) pursuant to the

                                       24
<PAGE>   32

instructions of an Investment Manager. The Company may enter into, or direct the
Trustee to enter into, a written agreement with one or more Investment Managers
designated by the Benefits Management Committee to manage the investments of one
or more of the Investment Funds. The Benefits Management Committee may remove
any such Investment Manager or any successor Investment Manager, or direct the
Trustee to do so, and any such Investment Manager may resign, upon giving
appropriate written notice thereof. Upon removal or resignation of an Investment
Manager, the Benefits Management Committee may appoint a successor Investment
Manager.

         6.6 PAYMENT OF EXPENSES.

                  (a) TRANSACTION EXPENSES. All expenses and charges incurred
         directly in connection with the purchase or sale of securities or
         assets and all taxes levied on or assessed in connection therewith
         shall be charged against the Investment Fund(s) whose assets were
         involved in such transaction.

                  (b) ADMINISTRATIVE COSTS. Administrative costs including (i)
         fees charged to the Plan by the Trustee and by the Investment Managers,
         (ii) costs charged to the Plan by the Company or by third parties for
         legal services, accounting, recordkeeping (including required
         software), investment management, plan administration, education and
         other direct expenses shall be allocated among, and charged to, the
         various Investment Funds once each calendar quarter, based upon the
         aggregate account balances in such Funds.

                  (c) OTHER EXPENSES. Except as provided in Sections 6.6(a) and
         (b), the Company and/or Employers will pay expenses incurred in
         administering the Plan,

                                       25
<PAGE>   33

         including expenses of the Benefits Management Committee and the
         Administrative Committee.

         6.7 USE OF ASSETS. The assets of the Trust Fund shall be at all times
used for, and not diverted to purposes other than, the exclusive benefit of
Members and their Beneficiaries and payment of administrative expenses pursuant
to Sections 6.6(a) and (b), except as provided in Section 5.2 and below in this
Section 6.7:

                  (a) DEDUCTION DISALLOWED. If all or part of an Employer's
         Matching Contributions is disallowed as a tax deduction under the Code,
         the Trustee will refund promptly to such Employer the amount thereof
         (reduced by any depreciation or loss in the Trust Fund attributable
         thereto) upon receipt of refund instructions from the Administrative
         Committee within one year thereafter.

                  (b) FAILURE TO QUALIFY. If the Internal Revenue Service
         determines that the Plan initially fails to constitute a Qualified Plan
         and the Company elects not to amend the Plan to constitute a Qualified
         Plan, the Trustee will refund to each Employer all Matching
         Contributions made within one year after the date the initial
         qualification is denied (but only if the application for a
         determination by the Internal Revenue Service is made by the time
         prescribed by law for filing the Company's return for the taxable year
         in which the Plan is adopted or such later date as the Secretary of the
         Treasury may prescribe) and thereupon the Plan shall terminate upon
         receipt of instructions from the Administrative Committee.

                  (c) MISTAKEN CONTRIBUTION. If an Employer makes a contribution
         to the Trust Fund in any amount due to a mistake of fact or law, the
         Trustee will return to such

                                       26
<PAGE>   34

         Employer the part thereof resulting from such mistake (reduced by any
         depreciation or loss in the Trust Fund attributable thereto) upon
         receipt of refund instructions from the Administrative Committee within
         one year after such contribution was made; provided that no such refund
         may reduce the number of Plan Shares that any Member was entitled to
         hereunder without regard to such mistake.

                  6.8 GENCORP STOCK FUND. The shares of common stock of GenCorp
Inc. attributable to Employee and Matching Contributions made under the GenCorp
Retirement Savings Plan prior to October 1, 1999 shall be held in the `GenCorp
Stock Fund Account" and the "GenCorp Stock Fund". Investments in the GenCorp
Stock Fund Account and GenCorp Stock Fund shall be made by the Trustee solely as
directed by the Members, their Beneficiaries and alternate payees, as provided
in Section 7.9.

                                    Article 7

                        Investment Options and Elections
                        --------------------------------

         7.1      INVESTMENT OPTIONS.

                  (a) EMPLOYEE CONTRIBUTIONS. Upon Enrollment pursuant to
         Section 2.2, each Member will elect to have his Contributions, if any,
         invested in one or more of the Investment Funds in whole-percentage
         increments totaling 100%.

                  (b) OTHER EMPLOYEE CONTRIBUTIONS. A Member's Supplemental
         Make-up Contributions will be invested in one or more Investment Funds
         in accordance with the investment option specified in respect of his
         After-Tax Contributions in his Enrollment then in effect or, if none,
         in an Enrollment filed at the time he makes the Supplemental

                                       27
<PAGE>   35

         Make-up Contributions. Subject to the following sentence, a Member's
         Rollover Contributions will be invested in one or more Investment Funds
         in accordance with the investment option specified in respect of his
         Before-Tax Contributions in either his Enrollment then in effect, or if
         none, then by written notice.

         7.2 CHANGES IN INVESTMENT FUNDS. A Member may change his election of
investment options specified in Section 7.1(a) by completing an Enrollment
Change indicating a new election of investment options. Any change pursuant to
this Section 7.2 will be effective for Employee Contributions made by or for the
Member with respect to the first payroll period after he completes the
Enrollment Change.

         7.3 TRANSFERS. A Member may transfer all or any part of his interest in
one or more Investment Funds to different Investment Funds by completing an
Enrollment Change directing such transfer or transfers in whole dollar amounts;
provided that a Member may not transfer from the OMNOVA Stock Fund his interest
in any Matching Contributions. A Member may make up to six (6) such transfers
during any 365-day period. If a transfer request is executed prior to 3:00 p.m.
E.S.T. on a Valuation Date, the transfer(s) will be made based upon the Plan
Share values in the Investment Funds as of the Trustee's close of business on
that Valuation Date. If a transfer request is executed at any other time (I.E.,
after 3:00 p.m. E.S.T. on a Valuation Date or at any time on any non-Valuation
Date, the transfer(s) will be made based upon the Plan Share values in the
Investment Funds as of the Trustee's close of business on the next following
Valuation Date. Notwithstanding the preceding two sentences, if a transfer
request involves one or more Investment Funds for which the Trustee is unable to
determine the total fair market value of assets held in such Fund or Funds as of
the otherwise applicable Valuation Date, such transfer

                                       28
<PAGE>   36

request will be held in suspense and made based upon the Plan Share values in
the Investment Funds as of the Trustee's close of business on the next following
Valuation Date on which the Trustee is able to determine the total fair market
value of all Funds involved in such transfer request.

         The amount transferred from an Investment Fund pursuant to this Section
7.3 will be the cash value of the Member's Plan Shares transferred from such
Investment Fund as of the applicable Valuation Date, and the Member's Account
will be reduced by such amount and then credited with the number of Plan Shares
in the Investment Fund to which transfer is made, determined by dividing such
amount by the value of Plan Shares in the Investment Fund to which the transfer
is made as of the applicable Valuation Date.

         7.4 MATCHING CONTRIBUTIONS. All Matching Contributions made for the
benefit of a Member will be invested only in the OMNOVA Stock Fund and may not
be transferred to another Investment Fund.

         7.5 ACCOUNTS. The Company will establish and maintain for each Member
an Account which shows separately:

                  (a) CONTRIBUTIONS. The amount of all Employee Contributions
         and Rollover Contributions, if any, made by or for the Member and
         Matching Contributions made by his Employer for his benefit:

                           (i)        Before-Tax Contributions,

                           (ii)       After-Tax Contributions,

                           (iii)      Pre-August 1, 1994 Supplemental Before-Tax
                                      Contributions,

                           (iv)       Pre-August 1, 1994 Supplemental After-Tax
                                      Contributions,

                                       29
<PAGE>   37

                           (v)        Rollover Contributions, and

                           (vi)       Matching Contributions.

                  (b) PLAN SHARES. The number and value of Plan Shares in each
         Investment Fund which have been credited to each Member's Account and
         reflect contributions, transfers, distributions and investment earnings
         and results of the Investment Funds selected by the Member.

         7.6 DIRECTIONS TO TRUSTEE. The Company shall give appropriate and
timely directions to the Trustee in order to permit the Trustee to give effect
to the investment choices and elections made pursuant to this Article 7 and to
provide funds for distributions pursuant to Article 10 and Article 11.

         7.7 MEMBER RESPONSIBILITY FOR SELECTION OF FUNDS. Each Member is solely
responsible for his decision to participate in the Plan and his selection of
Investment Funds and accepts all investment risks entailed by his participation
in and/or selection of an Investment Fund, including the risk of loss of and a
decrease in the value of contributions and Plan Shares. A Member's selection of
one or more Investment Funds and a Member's transfer of interests in his Account
from one to another Investment Fund pursuant to Section 7.3 shall be deemed an
exercise of control over assets in his Account for all purposes, including ERISA
section 404(c). Neither the Trustee, the Company, any Employer, the
Administrative Committee, the Benefits Management Committee, nor any of the
officers or supervisors of the Company or an Employer are empowered to advise a
Member as to the manner in which any contributions to the Plan or income thereon
should be invested or reinvested in his Account. The fact that an Investment
Fund or any interest in securities or other assets therein is available to
Members for investment

                                       30
<PAGE>   38

under the Plan shall not be deemed a recommendation for investment of
contributions in any Investment Fund, nor shall the provision of any Investment
Fund impose any liability on the Trustee, Administrative Committee, Benefits
Management Committee, the Company or any Employer or any director, officer or
employee of the Trustee, the Company or any Employer.

         7.8 VOTING AND TENDERING OF COMPANY SHARES.

                  (a) VOTING. Each Member (or if he has died, his Beneficiary)
         shall have the right and shall be afforded the opportunity to instruct
         the Trustee how to vote at any meeting of the Company's shareholders
         those Company Shares which are held in the OMNOVA Stock Fund and are
         allocated or allocable to his Account. Instructions by a Member to the
         Trustee shall be in such form and pursuant to such regulations as the
         Administrative Committee may prescribe and any such instructions to the
         Trustee shall remain in the strict confidence of the Trustee. If the
         Trustee does not receive instructions from a Member regarding the
         voting of Company Shares allocated or allocable to his Account, the
         Trustee shall vote such Company Shares and any additional Company
         Shares not allocated or allocable to Member Accounts as directed by the
         Benefits Management Committee. The preceding sentence notwithstanding,
         the Trustee will not vote such Company Shares to elect Directors if a
         person other than the Company's Directors or officers has solicited
         shareholder proxies for election of Directors.

                  (b) TENDERS AND EXCHANGES. Each Member (or if he has died, his
         Beneficiary) shall have the right and shall be afforded the opportunity
         to instruct the Trustee in writing as to the manner in which to respond
         to each tender or exchange offer for any or all Company Shares which
         are held in the OMNOVA Stock Fund and are allocated or

                                       31
<PAGE>   39

         allocable to his Account. The Company shall notify each Member (or
         Beneficiary) and utilize its best efforts to timely distribute or cause
         to be distributed to him such information as will be distributed to
         shareholders of the Company in connection with any such tender or
         exchange offer. Upon its receipt of such instructions, the Trustee
         shall tender or exchange such Company Shares as and to the extent so
         instructed. If the Trustee does not receive instructions from a Member
         (or Beneficiary) regarding any such tender or exchange offer for
         Company Shares, such Member (or Beneficiary) will be deemed to have
         instructed the Trustee not to tender or exchange, and the Trustee shall
         not tender or exchange, such Company Shares. Company Shares which are
         not allocated or allocable to Member Accounts shall be tendered or
         exchanged as directed by the Benefits Management Committee. All amounts
         received in exchange for Company Shares will be credited to the
         Member's Account and allocated to the OMNOVA Stock Fund.

                  (c) Each Member (or if he has died, his Beneficiary) who gives
         (or is deemed to have given) any instruction to the Trustee to vote,
         tender or exchange any Company Shares pursuant to Section 7.8(a) or
         Section 7.8(b) will be deemed a named fiduciary (as defined in ERISA)
         for such purposes and each such instruction will be deemed a proper
         direction (as defined in ERISA) to the Trustee, binding on both the
         Member (and his Beneficiary) and the Trustee. Other provisions hereof
         notwithstanding, the Benefits Management Committee may designate and
         delegate to an Investment Manager (rather than the Trustee) the duty
         and power to receive instructions from Members under Section 7.8(a) and
         Section 7.8(b) and to direct the Trustee to vote, tender or exchange
         Company Shares in accordance with such instructions.

                                       32
<PAGE>   40

         7.9 GENCORP STOCK FUND ACCOUNTS. Anything in the Plan to the contrary
notwithstanding, each Member who has GenCorp Stock allocated to his or her
Account in the Plan may direct the Trustee that the GenCorp Stock be retained in
the GenCorp Stock Fund, transferred to the OMNOVA Stock Fund or transferred to
any other investment fund maintained under the Plan. No transfers may be made by
such Member, Beneficiary or alternate payee into the GenCorp Stock Fund. Any
dividends on GenCorp Stock in Accounts of such Members, Beneficiaries or
alternate payees will be reinvested in GenCorp Stock.

                                    Article 8

                       Valuation of Assets and Plan Shares
                       -----------------------------------

         8.1 VALUATION OF ASSETS. As of the Trustee's close of business on each
Valuation Date, the Trustee shall determine the total fair market value of
assets held by it in each Investment Fund and the Trust Fund.

         8.2 DETERMINATION OF PLAN SHARE VALUES. As of the Trustee's close of
business on each Valuation Date, the Trustee shall determine the value of a Plan
Share in each Investment Fund by dividing (a) the total fair market value of
assets held in such Investment Fund, by (b) the total number of Plan Shares in
such Investment Fund determined by the Company in accordance with Section 8.4 as
of the end of the immediately preceding Valuation Date.

         8.3 REPORTING OF PLAN SHARE VALUES. As of the Trustee's close of
business on each Valuation Date, the Trustee shall report to the Company the
Plan Share values determined in accordance with Section 8.2.

                                       33
<PAGE>   41

         8.4 ADJUSTMENTS TO MEMBER ACCOUNTS. On each Valuation Date, after the
Trustee determines the values of Plan Shares in accordance with Section 8.2 and
reports such values to the Company in accordance with Section 8.3, the Company
will adjust each Member's Account (a) to reflect any changes in such Plan Share
values, and (b) to record (i) any contributions to the Investment Funds, (ii)
any transfers among the Investment Funds, and (iii) any distributions from the
Investment Funds, occurring with respect to the Member since the immediately
preceding Valuation Date. The Company then will report to the Trustee the
resulting number of Plan Shares in each Investment Fund.

         8.5 VALUES ON DAYS OTHER THAN VALUATION DATES. On any day which is not
a Valuation Date, the fair market value of assets held in any Investment Fund,
Plan Share values and Member's Account balances shall be deemed for all purposes
under the Plan to be the same as determined on the immediately preceding
Valuation Date in accordance with this Article 8.

         8.6 STATEMENT OF ACCOUNTS. At least annually, the Company shall furnish
to each Member and Beneficiary of each deceased Member a written statement
setting forth the value of his Account and Plan Shares in each Investment Fund
and the number of Company Shares corresponding to Plan Shares in the GenCorp
Stock Fund as of the last Monthly Valuation Date in the calendar year.

                                       34
<PAGE>   42

                                    Article 9

                              Vesting and Repayment
                              ---------------------

         9.1 VESTING OF INTERESTS.

                  (a) EMPLOYEE CONTRIBUTIONS. A Member's interests in the
         Employee Contributions that he has made or his Employer has made for
         him will be at all times vested and not subject to forfeiture.

                  (b) MATCHING CONTRIBUTIONS. A Member's interest in the
         Matching Contributions made for his benefit will be at all times vested
         and not subject to forfeiture (except forfeitures required under an
         Appendix or applicable provision of law). However, a Member may not
         elect pursuant to Section 10.1 or Section 10.2 a distribution of any
         Plan Shares attributable to Matching Contributions prior to the last
         day of the Plan Year which is two full Plan Years after the Plan Year
         for which the Matching Contributions were made for his benefit.

                  (c) If a Plan amendment, including any change in the vesting
         provisions that occurs when the Plan becomes or ceases to be top heavy,
         directly or indirectly affects the computation of a Member's vested
         interest, each Member with at least three years of Continuous Service
         with a Controlled Group Member may elect, within sixty days after the
         later of (i) the date the amendment is adopted; (ii) the date the
         amendment is effective; or (iii) the date the Member is provided
         written notice of the amendment by the Administrative Committee to have
         his or her nonforfeitable interest computed under the Plan without
         regard to the amendment. For any Member who does not perform at least
         an Hour of Service in any Plan Year beginning after December 31, 1988,
         the "three years

                                       35
<PAGE>   43

         of Continuous Service" clause in the preceding sentence will be
         replaced with five years of Continuous Service.

         9.2 REPAYMENT OF CONTRIBUTIONS.

                  (a) REPAYMENT. If a Member receives a distribution of Plan
         Shares credited to his Account upon or after the termination of his
         employment pursuant to Section l0.3 and he thereafter becomes an
         Eligible Employee, he may repay and restore to the Trust Fund, in a
         single-sum cash payment and on an after-tax basis, all or part of the
         value of his Basic Contributions and Supplemental Contributions that
         were so distributed to him; provided that he makes such payment before
         expiration of a period of five consecutive years after either (a) his
         subsequent Employment Commencement Date, or if earlier, (b) the date of
         such distribution; provided that the amount of such payment may not
         exceed any limitation under any Appendix hereto or applicable provision
         of law. No Employer will make any Matching Contributions in respect of
         any Basic Contributions which an Eligible Employee elects to restore
         under this Section 9.2(a).

                  (b) TIME AND AMOUNT OF RESTORATION. Each payment pursuant to
         this Section 9.2 will be transmitted to the Trustee as soon as
         practical, but within 30 days after the month in which such payment is
         received by the Member's Employer, and will be allocated to the
         Member's Account at the time and in the manner specified in Section 4.5
         for Basic Contributions and Supplemental Contributions and to one or
         more Investment Funds selected by the Member in his current Enrollment.
         Additionally, such payment will be treated as Basic After-Tax
         Contributions and allocated to Plan Years, beginning

                                       36
<PAGE>   44

         with the most recent Plan Year from which the distribution was made
         pursuant to Section 10.3.

         9.3 UNCLAIMED DISTRIBUTION. If a person entitled to receive a benefit
under the Plan cannot be located, the amount of his benefit will be forfeited
and used to reduce the amount of the Employer's Matching Contributions as
provided in Section 5.2. At any time before final distributions are made from
the Trust Fund following termination of the Plan, a person entitled to such
benefit may file a claim therefor with the Company. If the claim is upheld, and
the Employer who received the benefit of any corresponding forfeiture will
restore to the Trust Fund the amount required to pay such benefit, and
distribution of such benefit will be made as soon as practicable. Upon
termination of the Plan, all unclaimed benefits will be forfeited and
reallocated to the Accounts of the remaining Members, with each Member receiving
the same proportion thereof.

                                   Article 10

                            Distributions to Members
                            ------------------------

         10.1     REGULAR DISTRIBUTIONS.

                  (a) ELECTION. As of any Monthly Valuation Date following the
         end of the 180-day period following his enrollment pursuant to Section
         2.2 but subject to Section 9.1(b), a Member may elect to have
         distributed to him the value of all or any part of the Plan Shares
         which are attributable to his Employee Contributions, Rollover
         Contributions, Matching Contributions and earnings and credited to his
         Account by completing and filing with his Employer a Distribution
         Request not later than the 15th calendar day of the

                                       37
<PAGE>   45

         month in which such Monthly Valuation Date occurs. Additionally, a
         Member may elect a distribution only once in any period of six
         consecutive months, and all distributions from his Account will be in
         the order specified in Section 10.1(b) and subject to all other
         applicable limitations hereunder.

                  (b) ORDER OF DISTRIBUTION. The Member must designate in his
         Distribution Request the amount to be distributed from his Account and
         any Investment Fund and the distribution will be made in accordance
         with the order and limitations specified below:

                           (i) First, the value of Plan Shares attributable to
                  After-Tax Contributions made prior to 1987.

                           (ii) Next, the value of Plan Shares attributable to
                  the Member's After-Tax Contributions for which there were no
                  corresponding Matching Contributions.

                           (iii) Next, the value of Plan Shares attributable to
                  the Member's After-Tax Contributions in Plan Years for which
                  there were corresponding Matching Contributions and for which
                  his interest in such Matching Contributions may be distributed
                  to him under Section 9.1(b), beginning with the earliest such
                  Plan Year.

                           (iv) Next, the value of Plan Shares attributable to
                  Matching Contributions made for his benefit and which may be
                  distributed to him under Section 9.1(b), beginning with the
                  earliest Plan Year in which such Matching Contributions were
                  made.

                                       38
<PAGE>   46

                           (v) Next, the value of Plan Shares attributable to
                  the Member's Rollover Contributions.

                           (vi) Next, the value of Plan Shares attributable to
                  After-Tax Contributions in a Plan Year for which there were
                  corresponding Matching Contributions and for which his
                  interest in such Matching Contributions may not be distributed
                  to him under Section 9.1(b), beginning with the earliest such
                  Plan Year.

                  (c) EXCEPTION. Section 10.1(b) notwithstanding, a Member who
         is at least 59 l/2 years old may elect a distribution of the value of
         all or any part of the Plan Shares attributable to his Before-Tax
         Contributions and credited to his Account prior to any distribution of
         his After-Tax Contributions, Matching Contributions and earnings
         credited to his Account pursuant to Section 10.1(a) and Section
         10.1(b).

         10.2 HARDSHIP DISTRIBUTION. After electing a distribution of the value
of all Plan Shares available to him under Section l0.1(a), a Member also may
elect in case of financial hardship to have distributed to him, in the order
specified in Section 10.l(b), the value of all or part of the Plan Shares
attributable, first, to his Supplemental Before-Tax Contributions, and second,
to his Basic Before-Tax Contributions, and credited to his Account by submitting
his written request to his Employer at least l5 days prior the next subsequent
Monthly Valuation Date and in such manner as the Administrative Committee
prescribes and subject to satisfaction of the following two conditions:

                  (a) First, the distribution request must be for an immediate
         and heavy financial need on account of:

                                       39
<PAGE>   47

                           (i) Nonreimbursable medical expenses incurred by the
                  Member, his spouse, or dependents;

                           (ii) Purchase (excluding mortgage payments) of a
                  principal residence for the Member;

                           (iii) Payment of tuition for the next semester or
                  quarter of post-secondary education for the Member, his
                  spouse, children, or dependents; or

                           (iv) The need to prevent the eviction of the Member
                  from his principal residence or foreclosure on the mortgage on
                  the Member's principal residence; and

                  (b) Second, the amount distributed may not exceed the actual
         expense incurred or to be incurred by the Member on account of such
         needs and only to the extent that the need cannot be satisfied from
         other resources and funds reasonably available to the Member,
         including, without limitation, a distribution pursuant to Section
         l0.1(a) and/or Section 10.1(c).

                  (c) LIMITATIONS. Any Member who receives a distribution
         pursuant to this Section 10.2 may not make or have made on his behalf
         any Employee Contributions to the Plan or any other plan of his
         Employer for a period of l2 consecutive months after such distribution,
         and the maximum amount of Employer Contributions that may be allocated
         on his behalf as Before-Tax Contributions under the Plan and all other
         plans of this Employer in his next tax year after the tax year in which
         he received such withdrawal shall be limited to the excess of the
         applicable limit under Code section 402(g) for such

                                       40
<PAGE>   48

         next tax year over the Member's Before-Tax Contributions for the tax
         year in which he received such withdrawal.

         10.3 TERMINATION DISTRIBUTIONS TO MEMBERS.

                  (a) TERMINATION DISTRIBUTIONS. A Member may elect as of the
         Monthly Valuation Date occurring in the month in which his Termination
         of Employment Date occurs or any Monthly Valuation Date thereafter a
         distribution of the value of Plan Shares credited to his Account by
         completing and filing with his Employer a Distribution Request on or
         before the 15th day of the month in which occurs such Monthly Valuation
         Date; provided that, if the aggregate value of all Plan Shares credited
         in his Account does not exceed $3,500, the entire amount thereof
         automatically will be distributed to him as soon as practical after the
         Monthly Valuation Date first occurring after his Termination of
         Employment Date.

                  (b) DELAYED DISTRIBUTIONS. A Member who incurs a Termination
         of Employment Date may elect irrevocably a distribution of the value of
         all Plan Shares credited to his Account in the calendar year following
         the year in which such termination occurs, based on the value of Plan
         Shares as of November 30 in the calendar year in which such termination
         occurs, by completing and filing with his Employer a Distribution
         Request no later than November 15 of the same calendar year.

         10.4 TIME AND FORM OF DISTRIBUTIONS. Each distribution pursuant to this
Article l0 shall be made in a single-sum cash payment, except that (i)
distributions from the OMNOVA Stock Fund will be in the form of whole Company
Shares plus cash for any fractional Company Share unless the Member elects to
receive the cash value thereof, and (ii) distributions from the

                                       41
<PAGE>   49

GenCorp Stock Fund will be in the form of whole shares of common stock of
GenCorp Inc. plus cash for any fractional shares thereof unless the Member
elects to receive the cash value thereof, and shall be made as soon as
practicable after all information necessary to process the distribution is
received, and except as provided in Section 10.3(b), the amount shall be equal
to value of Plan Shares as of the Monthly Valuation Date for the month in which
all necessary information is received.

         10.5 REEMPLOYMENT OF MEMBER. If a Member whose employment has been
terminated again becomes an Employee before receiving a full distribution of his
Account balance, no distribution hereunder will be made or continued while he is
an Employee, and amounts which would have been distributed to him on account of
such termination will be held in the Trust Fund until he is again entitled to a
distribution under the Plan.

         10.6 DIRECT ROLLOVERS.

                  (a) Notwithstanding any provision of the Plan to the contrary
         that would otherwise limit a Distributee's election under this section,
         a Distributee may elect, at the time and in the manner prescribed by
         the Company, to have any portion of an Eligible Rollover Distribution
         paid directly to an Eligible Retirement Plan specified by the
         Distributee in a Direct Rollover.

                  (b) DEFINITIONS. For purposes of this section 10.6, the
         following terms shall have the meanings set forth in this subsection
         (b):

                           (1) "Eligible Rollover Distribution" means any
                  distribution of all or any portion of the balance to the
                  credit of the Distributee, except that an Eligible Rollover
                  Distribution does not include: any distribution that is one of
                  a series of

                                       42
<PAGE>   50

                  substantially equal periodic payments (not less frequently
                  than annually) made for the life (or life expectancy) of the
                  Distributee or the joint lives (or joint life expectancies) of
                  the Distributee and the Distributee's designated Beneficiary,
                  or for a specified period of ten years or more; any
                  distribution to the extent such distribution is required under
                  Code section 401(a)(9); and the portion of any distribution
                  that is not includible in gross income (determined without
                  regard to the exclusion for net unrealized appreciation with
                  respect to employer securities).

                           (2) "Eligible Retirement Plan" means an individual
                  retirement account described in Code section 408(a), an
                  individual retirement annuity described in Code section
                  408(b), an annuity plan described in Code section 403(a), or a
                  qualified trust described in Code section 401(a) that accepts
                  the Distributee's Eligible Rollover Distribution. However, in
                  the case of an Eligible Rollover Distribution to the surviving
                  spouse, an Eligible Retirement Plan is an individual
                  retirement account or individual retirement annuity.

                           (3) "Distributee" means an Employee or former
                  Employee. In addition, the Employee's or former Employee's
                  surviving spouse and the Employee's or former Employee's
                  spouse or former spouse who is the alternate payee under a
                  qualified domestic relations order, as defined in Code section
                  414(p), are Distributees with regard to the interest of the
                  spouse or former spouse.

                           (4) "Direct Rollover" means a payment by the Plan to
                  the Eligible Retirement Plan specified by the Distributee.

                                       43
<PAGE>   51

         10.7 LOANS

                  (a) LOAN PROGRAM. The Committee is authorized to establish and
         administer a program to make available to Members to opportunity to
         borrow funds from their Accounts in accordance with the terms set forth
         below and pursuant to such procedures and guidelines for obtaining a
         loan as the Committee, or its delegate, may prescribe and publish.

                  (b) AMOUNTS OF LOANS. The maximum loan available to a Member,
         whether such Member is a Highly Compensated employee or a Non-Highly
         Compensated Employee, is fifty percent of such Member's aggregate
         Account balance, subject to a maximum of $50,000. While Matching
         Contributions are not available for loan, they are included in the
         computation of the maximum loan amount. The minimum loan amount is
         $1,000.

                  (c) SOURCE OF LOANS.

                           (i) ACCOUNTS. A loan to a Member will be deducted
                  from funds in his Account in the same order set forth in
                  Section 10.1(b) for in-service withdrawals, except that no
                  funds attributable to Matching Contributions will be available
                  as a source of loans.

                           (ii) INVESTMENT FUNDS. A loan to a Member will be
                  deducted prorata from his available balances in all Investment
                  Funds.

                  (d) TERMS OF LOAN. Loans will be made on such terms and
         subject to such limitations as the Committee may prescribe, provided
         any such loan is evidenced by a written promissory note, bears a
         reasonable rate of interest on the unpaid principal, is

                                       44
<PAGE>   52

         adequately secured, and will be repaid by the Member over a period not
         to exceed five years, unless the loan is for the purpose of acquiring a
         primary residence for the Member (in which case a 10-year repayment
         period is permitted). The interest rate charged on a loan must be at
         least equivalent to the prevailing interest rate charged by persons in
         the business of lending money for loans which would be made under
         similar circumstances.

                  (e) SECURITY. A loan to a Member will be secured by his right,
         title and interest in his Account balance. The Member's pledge will be
         evidenced by a promissory note.

                  (f) REPAYMENT OF LOAN. All loans will amortized on a
         substantially level basis, and repaid by means of monthly payroll
         deduction. Early loan repayment is permitted only for the full amount
         of a Member's outstanding loan. Loan repayments are deposited directly
         into the Member's Account, first replacing any Before-Tax Contributions
         (and earnings thereon) that were included in the loan, then replacing
         any After-Tax Contributions (and earnings thereon) that were included
         in the loan. Repayments are allocated to the Investment Funds based
         upon the Member's most recent Enrollment elections for future
         contributions.

                  The Committee, or its delegate, may suspend a Member's loan
         payment obligation for up to one year if the Member is not receiving a
         paycheck due to a company-approved temporary leave of absence. However,
         such a suspension cannot extend the total repayment period beyond the
         maximum 5- or 10-year period described in subsection (d). Interest on
         the Member's loan balance continues to accrue during any such period of
         suspension.

                                       45
<PAGE>   53

                  (g) DEFAULT ON LOAN. In the event the Member's employment with
         an Employer terminates, all remaining principal payments, and any
         outstanding interest payments, on the loan will be immediately due and
         payable. The Committee is authorized (to the extent permitted by law)
         to take any and all actions necessary and appropriate to enforce
         collection of an unpaid loan. However, in the event of default,
         foreclosure on the note and attachment of security will not occur until
         a distributable event occurs under the Plan. A default will be deemed
         to have occurred if any loan payment has not been made with 90 days of
         when the payment was due to be paid by the Member.

                                   Article 11

               Distributions to Beneficiaries and Alternate Payees
               ---------------------------------------------------

         11.1 DISTRIBUTIONS TO BENEFICIARIES. Upon his death, a Member's
interest in his Account will be distributed to the Beneficiary or Beneficiaries
designated by the Member pursuant to Section 11.2 or, if he has designated no
Beneficiary who survives him, to (a) his spouse, if living and if not, (b) his
then living children in equal shares, or if none are living, (c) his living
parents in equal shares, or if neither is living, (d) his estate.

         11.2 DESIGNATION OF BENEFICIARY.

                  (a) METHOD OF DESIGNATION. Subject to Section 11.2(b), each
         Member may designate a Beneficiary or Beneficiaries to receive the
         distribution from his Account upon his death in the beneficiary
         designation form prescribed the Company and filed in connection with
         Enrollment pursuant to Section 2.2, and may change or revoke any

                                       46
<PAGE>   54

         designated Beneficiary by completing and filing a new beneficiary
         designation form with his Employer.

                  (b) CONSENT OF SPOUSE REQUIRED. A Member who has a spouse may
         designate a Beneficiary other than, or in addition to, his spouse only
         if his spouse consents thereto irrevocably in a writing that is filed
         with his Employer, is signed by the spouse, contains the spouse's
         acknowledgement of the effect of the consent, and is witnessed by a
         notary public. If a spouse consents to the designation of a Beneficiary
         other than or in addition to the spouse, the Member may change such
         designation only if his spouse consents thereto irrevocably in a
         writing that is filed with his Employer, is signed by the spouse,
         expressly authorizes the Member to designate one or more Beneficiaries
         other than, or in addition to, the spouse without any further consent
         of the spouse, acknowledges that such consent was given after the
         spouse was advised of the right to limit consent to a specific
         Beneficiary, and is witnessed by a notary public.

         11.3 FORM AND TIME OF DISTRIBUTION. Each distribution pursuant to
Section 11.2 will be made in a single-sum cash payment and/or Company Shares in
the same manner as provided for Members in Section 10.4 and will be made as soon
as practicable after all necessary documentation is received. Plan Shares in the
Member's Account will be valued as of the Monthly Valuation Date for that month
in which all necessary documentation is received.

                                       47
<PAGE>   55
                                   Article 12

                         Special Distribution Provisions
                         -------------------------------

         12.1 DISTRIBUTION ELECTION. Other provisions hereof notwithstanding,
unless he otherwise elects, the value of all Plan Shares credited to a Member's
Account will be distributed to him within 90 days of the later of (i) the date
on which he attains age 65, (ii) the tenth anniversary of date on which he first
enrolled and commenced participation in the Plan, or (iii) the date on which his
employment by a Controlled Group Member terminates. A Member's failure to elect
a distribution pursuant to Article l0 prior to the foregoing date will be deemed
an election not to receive a distribution at such time.

         12.2 MANDATORY DISTRIBUTION. Other provisions hereof notwithstanding,
the value of all Plan Shares credited to a Member's Account will be distributed
to him as provided in Section l0.4 on or before April l of the calendar year
following the earlier of the calendar year in which he attains age 70 l/2 or
(ii) the calendar year in which he retires.

         12.3 DEATH OF MEMBER. If a Member dies after electing but before
receiving a distribution of all or part of his vested interests in his Account,
the amount thereof will be paid to any surviving Beneficiary or Beneficiaries
that he has designated pursuant to Section 11.2 or, if no Beneficiary survives
him, as provided in Section 11.1.

         12.4 DEATH OF BENEFICIARY. If a Beneficiary dies after the Member who
designated him as a Beneficiary but before receiving a distribution pursuant to
Section 11.2, the amount thereof will be paid to the heirs or estate of such
Beneficiary in the same manner and within the time provided in Section 11.1.

                                       48
<PAGE>   56

         12.5 LEGAL CAPACITY. If any benefit hereunder becomes payable to a
minor or other person lacking legal capacity and the Administrative Committee
becomes aware thereof, payment thereof will be made only to the guardian of such
person, who is appointed by a court or in such other manner as will discharge
the obligations of the Plan, the Trustee and the Company.

         12.6 DELAYED PAYMENT. If the amount of a distribution under the Plan
cannot be made by the date herein specified for payment due to lack of necessary
information, inability to locate a Member or Beneficiary or any other cause
beyond the reasonable control of the Trustee or Company, payment thereof may be
made as soon as practically possible, based on the value of Plan Shares as of
the last Monthly Valuation Date prior to such payment.

                                   Article 13

                           Administration of the Plan
                           --------------------------

         13.1 ADMINISTRATOR. The Company will be both the administrator and
sponsor of the Plan, as defined in ERISA sections 3(l6)(A) and (B), for purposes
of complying with the reporting and disclosure requirements imposed by ERISA and
the Code and administering the Plan. In complying with such requirements and in
administering the Plan, the Company will use its Human Resources Department and
those of other Employers, the Administrative Committee and Benefits Management
Committee as herein provided and as the Company may direct.

         13.2 ADMINISTRATIVE COMMITTEE.

                  (a) RESPONSIBILITIES. The Administrative Committee will have
         general responsibility for interpreting and assuring uniform
         administration of the provisions of the Plan, except the Trust
         Agreement.

                                       49
<PAGE>   57

                  (b) MEMBERS. The members of the Administrative Committee will
         be the persons who serve the Company in the capacities of Senior Vice
         President and Chief Financial Officer, Senior Vice President, Human
         Resources, Senior Vice President, Law and General Counsel, Director of
         Benefits, and Director of Compensation and such other or additional
         persons as the Administrative Committee may designate. Each person who
         is or becomes a member of the Administrative Committee will signify his
         acceptance by filing a written acceptance, and may resign by filing his
         written resignation, with the Secretary to the Administrative
         Committee.

                  (c) CHAIRMAN, SECRETARY AND RECORDS. The Administrative
         Committee will elect from its members a Chairman and a Secretary. The
         Secretary will keep a record of the Administrative Committee's
         proceedings and documents pertaining to the Administrative Committee's
         administration of the Plan.

                  (d) MEETINGS. The Administrative Committee shall hold meeting
         upon such notice, at such places and at times as it or the Secretary
         may determine.

                  (e) ACTION. A majority of the Administrative Committee shall
         constitute a quorum for the transaction of business. All resolutions or
         other action taken by the Administrative Committee shall be by the vote
         of a majority of the members present at a meeting or without a meeting
         by an instrument signed by a majority of the members.

         13.3 BENEFITS MANAGEMENT COMMITTEE.

                  (a) RESPONSIBILITIES. The Benefits Management Committee will
         have the responsibilities related to maintaining relationships with the
         Trustee and Investment Managers and investment of the Trust Fund as set
         forth in Section 13.5(b).

                                       50
<PAGE>   58

                  (b) MEMBERS. The members of the Benefits Management Committee
         will be the persons who serve the Company in the capacities of Chief
         Executive Officer, Senior Vice President and Chief Financial Officer,
         Senior Vice President, Human Resources, Senior Vice President, Law and
         General Counsel, and such other or additional persons as the Benefits
         Management Committee may designate. Each person who is or becomes a
         member of the Benefits Management Committee will signify his acceptance
         by filing a written acceptance, and may resign by filing his written
         resignation, with the Secretary to the Benefits Management Committee.

                  (c) CHAIRMAN, SECRETARY AND RECORDS. The Benefits Management
         Committee will elect from its members a Chairman and a Secretary. The
         Secretary will keep a record of the Benefits Management Committee's
         proceedings and documents pertaining to the Benefits Management
         Committee's administration of the Plan.

                  (d) MEETINGS. The Benefits Management Committee shall hold
         meeting upon such notice, at such place and at time as it or the
         Secretary may determine.

                  (e) ACTION. A majority of the Benefits Management Committee
         shall constitute a quorum for the transaction of business. All
         resolutions or other action taken by the Benefits Management Committee
         shall be by the vote of a majority of the members present at a meeting
         or without a meeting by an instrument signed by a majority of the
         members.

         13.4 NAMED FIDUCIARIES. The Company, the Trustee, the Administrative
Committee and the Benefits Management Committee shall each be a named fiduciary
as defined in ERISA.

                                       51
<PAGE>   59

         l3.5 AUTHORITY AND DUTIES OF VARIOUS FIDUCIARIES.

                  (a) PLAN INTERPRETATION. Except as otherwise provided by the
         terms of the Plan, the Administrative Committee shall have the
         exclusive right to interpret the Plan (except the Trust Agreement) and
         to decide any and all matters arising under the Plan or in connection
         with its administration, including, without limitation, Continuous
         Service, eligibility to participate in the Plan, and determining
         eligibility for and the amount of any benefit. The Company shall have
         no power to direct or modify any interpretation, determination, or
         decision of the Administrative Committee. The Administrative Committee
         may adopt rules for the administration of the Plan and the conduct of
         its business, which rules shall be consistent with the provisions of
         the Plan.

                  (b) INVESTMENT ADMINISTRATION. The Benefits Management
         Committee will have general responsibility for maintaining
         relationships with the Trustee and Investment Managers; selection and
         removal of the Trustee and Investment Managers; discontinuing,
         establishing or modifying Investment Funds and related investment
         objectives; establishing and reviewing general investment guidelines
         and policies; monitoring and evaluating the performance of the Trustee
         and Investment Managers; establishing and implementing policies and
         methods for funding the Plan consistent with the objectives of the Plan
         and the requirements of law; and informing the Trustee about projected
         short-term and long-term financial requirements and need for cash to
         make distribution.

                  (c) DATA AND RECORDS. The Company shall keep or cause to be
         kept in convenient form such personnel data as may be necessary for the
         Plan. The Company

                                       52
<PAGE>   60

         shall prepare, distribute, and file such reports and notices as may be
         required by applicable law or regulations.

                  (d) SERVICES. The Company, the Administrative Committee, the
         Benefits Management Committee and any other named fiduciary may each
         employ counsel, agents, and such clerical and accounting services as it
         may require in carrying out its responsibilities under the Plan. All
         fiduciaries shall be entitled to rely upon tables, valuations,
         certificates, opinions, and reports furnished by any actuary,
         accountant, or legal counsel appointed under the provisions of the
         Plan.

                  (e) STANDARD OF CONDUCT. Members of the Administrative and
         Benefits Management Committees shall use that degree of care, skill,
         prudence and diligence that a prudent man acting in a like capacity and
         familiar with such matters would use in his conduct of a similar
         situation. Members of the Administrative or Benefits Management
         Committee shall not be liable for the breach of fiduciary
         responsibility of another fiduciary unless (l) he knowingly
         participates in, or knowingly undertakes to conceal, an act or omission
         of such other fiduciary, knowing such act or omission is a breach; or
         (2) he has enabled such other fiduciary to commit a breach; by his
         failure to discharge his duties solely in the interest of Members and
         Beneficiaries for the exclusive purpose of providing their benefits and
         defraying reasonable expenses of administering the Plan not met by the
         Company; or (3) he has knowledge of a breach by such other fiduciary
         and does not make reasonable efforts to remedy the breach; or (4) if
         the Administrative Committee or Benefits Management Committee
         improperly allocates among its Members

                                       53
<PAGE>   61

         or delegates to others, or fails to properly review such allocation or
         delegation of fiduciary responsibilities.

                  (f) INDEMNIFICATION. The Company will indemnify and save
         harmless the members of the Administrative Committee and Benefits
         Management Committee against any and all expenses (including attorneys'
         fees), judgments, fines, and amounts paid in settlement, actually and
         reasonably incurred by him in connection with any civil, criminal,
         administrative, or investigative action, proceeding, or claim
         (including an action by or in the right of the Company) by reason of
         the fact that he is or was serving in such capacity; provided that such
         person's conduct is not finally adjudged to have been knowingly
         fraudulent, deliberately dishonest or willful misconduct.

                  (g) DISCRETION. Whenever, in the administration of the Plan,
         any discretionary action is required, the authorized party shall
         exercise his authority in a nondiscriminatory manner so that all
         persons similarly situated will receive substantially the same
         treatment.

         13.6 DELEGATION. By appropriate instrument, unless precluded by the
terms of such appointment, any named fiduciary designated herein may designate
any person (including any firm or corporation) to carry out and cause to be
performed part or all of such fiduciary's responsibilities and, upon such
designation, the named fiduciary shall have no liability, except as imposed by
applicable law, for any act or omission of such person. The foregoing does not
preclude any other fiduciary to the extent allowed by ERISA and the terms of his
appointment from delegating part or all of such fiduciary's responsibilities
with respect to the Plan.

         13.7 MULTIPLE CAPACITIES. Any fiduciary may serve in more than one
fiduciary capacity with respect to the Plan.

                                       54
<PAGE>   62

         13.8 COMPENSATION AND EXPENSES OF FIDUCIARIES. A fiduciary will be
entitled to receive any reasonable compensation for services rendered or for the
reimbursement of expenses properly and actually incurred in the performance of
his or her duties under the Plan. However, a fiduciary who already receives
full-time pay from an Employer will receive no compensation from the Plan,
except for reimbursement of expenses properly and actually incurred.

                                   Article 14

                                Claim Procedures
                                ----------------

         14.1 CLAIM. Any Employee, Eligible Employee, Member or Beneficiary who
believes that he is entitled to or has not received a right or benefit due him
under the Plan may make a claim therefor by filing a written claim with the
Company or his Employer.

         14.2 INITIAL DETERMINATION. The Company acting for itself or through
the Human Resources Department of the Company or an Employer will determine
initially any claim made pursuant to Section l4.1, including without limitation,
eligibility for and the amount of any benefit claimed by a Member or a
Beneficiary, and will mail or deliver to the claimant a written notice of its
decision. Each notice denying a claim, in whole or part, will specify the
reasons therefor, state the time within which the Employee, Member or
Beneficiary has to request review thereof and contain such other information as
the law may require. Such notice will be given within 30 days after filing of
the claim. If special circumstances require additional time for processing the
claim, the Company may delay issuing its decision for an additional 30 by giving
the claimant written notice of the circumstances requiring the delay. If no
notice of decision or delay is given within 30 days after the claim is filed,
the claim shall be deemed denied.

                                       55
<PAGE>   63

         14.3 REVIEW. Within 60 days after receipt of the decision denying his
claim, in whole or part, such Employee, Member, Beneficiary or other claimant
may request that the Administrative Committee review the denial by filing a
written request for review with the Administrative Committee, and will have the
right to inspect such documents as the Administrative Committee may determine,
and meet with the Administrative Committee at such time and place as the
Administrative Committee determines, with or without a representative of his
choice. The Administrative Committee shall issue a written decision, stating the
reasons therefor, including specific references to pertinent provisions of the
Plan, applicable practice and policy under the Plan, prior decisions of the
Administrative Committee and other information which the law may require or the
Administrative Committee deems appropriate, within 60 days after receipt of the
request for review. If special circumstances require additional time for
processing such review, the Administrative Committee may delay issuing its
decision for an additional 60 days by giving the claimant written notice of such
circumstances and the date the Administrative Committee expects to render its
final decision. If the decision is not issued within the prescribed period, the
appeal shall be deemed denied. No claimant shall have recourse to courts of law
until the administrative review process set forth herein has been completed.

         l4.4 EFFECT OF DECISION. The decisions of the Administrative Committee
pursuant to this Article l3 shall be final and binding on the Company and any
Employer, Employee, Member, Beneficiary or other claimant unless a court having
jurisdiction of the matter under ERISA determines that such decision was
arbitrary and capricious.

                                       56
<PAGE>   64

                                   Article 15

                  Adoption of Plan by Controlled Group Members
                  --------------------------------------------

         15.1 PLAN ADOPTION PROCEDURE. Any Controlled Group Member may become an
Employer under the Plan if (a) the Company first approves the adoption of the
Plan by the Controlled Group Member and participation of the Controlled Group
Member in the Plan as an Employer and the eligibility of all or some categories
of the Employees of the Controlled Group Member to participate in the Plan as
Members; (b) pursuant to resolution of its directors in a form satisfactory to
the Company, the Controlled Group Member adopts the Plan, as amended, and
delegates to the Company authority to (i) enter into the Trust Agreement and
agreements with one or more Investment Managers, (ii) amend and/or terminate the
Plan, Trust Agreement and/or agreements with Investment Managers, and (iii)
administer the Plan in accordance with its terms; and (c) the Controlled Group
Member agrees to be bound by any other terms and conditions which the Company
may require and are consistent with the purposes of the Plan.

         15.2 EFFECT OF PLAN ADOPTION. A Controlled Group Member that adopts the
Plan pursuant to this Article will be an Employer for all purposes hereunder. If
the Company so authorizes, the Eligible Employees of a Controlled Group Member
may receive credit under the Plan for their employment with the Controlled Group
Member prior to the date it became a Controlled Group Member for purposes of
determining vesting of the interests of such Employees in their Account;
provided that such credit will be applied in a uniform and nondiscriminatory
manner with respect to all such Eligible Employees.

                                       57
<PAGE>   65

                                   Article 16

                            Amendment and Termination
                            -------------------------

         16.1 AMENDMENT. The Company acting for itself or through the
Administrative Committee reserves the right to modify or amend, in whole or in
part, any and all provisions of the Plan; provided that no modification or
amendment:

                  (a) shall permit any part of the assets of the Trust Fund to
         be used for, or diverted to, purposes other than the exclusive benefit
         of Members and their Beneficiaries, except as provided in Section 6.7;

                  (b) retroactively change the provisions for vesting any
         Member's interest in any Matching Contributions made for his benefit;

                  (c) retroactively decrease the percentage of an Employer's
         Matching Contribution; or

                  (d) decrease any Member's interest in Employee Contributions,
         Rollover Contributions, Matching Contributions or earnings credited to
         his Account to the extent his interest therein has vested.

         16.2 TERMINATION.

                  (a) BY THE COMPANY. The Company reserves the right to
         terminate the Plan for any reason in respect of any or all Employers
         and/or categories of Eligible Employees, and direct complete
         discontinuance of contributions hereunder by any or all Employers
         and/or categories of Eligible Employees.

                  (b) BY AN EMPLOYER. Subject to the Company's approval, an
         Employer may discontinue its participation in the Plan for any reason
         in respect of any or all of its

                                       58
<PAGE>   66

         categories of Eligible Employees and/or completely discontinue
         contributions hereunder by any or all categories of its Eligible
         Employees.

                  (c) INSTRUCTIONS TO TRUSTEE. If the Company terminates the
         Plan as to all Employers and Eligible Employees or discontinues all
         contributions to the Trust Fund, the Company will instruct the Trustee
         to distribute to each Member the value of all Plan Shares credited to
         each Member as soon as practical and to continue to manage the Trust
         Fund until all assets in the Trust Fund have been distributed to
         Members except as otherwise provided in Section 6.7 in respect of
         Matching Contributions.

                                   Article 17

                           Consolidation and Transfer
                           --------------------------

         17.1 CONSOLIDATION. Subject to Section 17.3, the Company may
consolidate this Plan and any other plan maintained by any Employer on such
terms and conditions as the Company may determine.

         17.2 TRANSFER. Subject to Section 17.3, the Company may permit Members
to transfer to this Plan any interests they may have under a plan maintained by
the Company or Employer on such terms and conditions as the Company may
determine.

         17.3 PRESERVATION OF BENEFITS. In the event of a merger or
consolidation with, or transfer of assets to any other plan, each Member will
receive a benefit immediately after such merger, consolidation or transfer (if
the Plan then terminated) which is at least equal to the benefit the Member was
entitled to immediately before such merger, consolidation or transfer (if the
Plan had terminated).

                                       59
<PAGE>   67

                                   Article 18

                              Additional Provisions
                              ---------------------

The provision of the Appendices set forth below are incorporated herein by
reference and made a part hereof:

                  (A)      Appendix A, Nondiscrimination Requirements

                  (B)      Appendix B, Limitations on Allocations

                  (C)      Appendix C, Top-Heavy Provisions

                                   Article 19

                                  Miscellaneous
                                  -------------

         19.1 BENEFITS PAYABLE FROM TRUST FUND. All persons with any interest in
the Trust Fund shall look solely to the Trust Fund for any payments with respect
to such interest.

         19.2 PAYMENTS FOR EXCLUSIVE BENEFITS OF MEMBERS. Payments of benefits
in respect of the interest of a Member under the Plan to any person other than
such Member in accordance with the provisions of the Plan shall be deemed to be
for the exclusive benefit of such Member.

         19.3 ADDRESS OF RECORD. Each Member, Beneficiary or other person who
has an interest under the Plan, actual or potential, shall file and maintain on
file with the Company and/or an Employer a current address. Communications
mailed by the Company and/or Employer, Trustee, or Administrative Committee to
such address will fulfill all obligations to provide required information to
Members, including former Employees and Beneficiaries, in regard to the Plan.
The last address as shown by the Company and/or Employer's records will be
presumed to be the current address and all communications, including without
limitation

                                       60
<PAGE>   68

statements of a Member's Account, mailed thereto will be deemed given when
mailed to such address.

         19.4 ELECTIONS. Members will make all elections hereunder in writing by
the completion and delivery of forms prescribed by the Company or Administrative
Committee for such purposes, within the time limits set forth hereunder with
respect to each such election or, if no time limit is set forth, such limit as
may be established by the Administrative Committee. When the time limit for
making an election would expire on a non-business day of the Company, such time
shall be extended to the next business day of the Company.

         19.5 NO RIGHT TO CONTINUED EMPLOYMENT. Neither the establishment or
continuance of the Plan nor the making of any contributions to the Plan nor the
payment of any benefits hereunder nor any action of the Company and/or Employer,
the Directors, the Administrative Committee, the Benefits Management Committee,
or the Trustee shall be held or construed to confer upon any person any legal
right to be continued in the employ of the Company or any Employer or to limit
the right of the Company or any Employer to terminate the employment of any
person.

         19.6 NO ASSURANCE. Nothing herein will be deemed an assurance or
guarantee that the Trust Fund or any Investment Fund will not decrease in value
or incur a loss.

         19.7 TIME OF ACTION. Any action required or permitted to be taken
hereunder may be taken at any time and from time to time unless the Plan
expressly requires such action to be taken at or within a specified time.

         19.8 HEADINGS. Headings of Articles and Sections of the Plan are
inserted for convenience of reference and do not constitute a part of the Plan.

                                       61
<PAGE>   69

         19.9 USE OF MASCULINE TERMS. Masculine terms shall include the feminine
wherever appropriate.

        19.10 OHIO LAW TO GOVERN. All questions pertaining to the construction,
regulation, validity and effect of the provisions of the Plan, including the
Trust Agreement, shall be determined in accordance with the laws of the State of
Ohio, except as provided in ERISA.

         19.11 INALIENABILITY OF BENEFITS AND INTEREST. No benefit payable under
the Plan or interest in the Trust Fund shall be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance or
charge, and any such attempted action shall be void and no such benefit or
interest shall be in any manner liable for or subject to debts, contracts,
liabilities, engagements or torts of any Member or Beneficiary. If any Member or
Beneficiary shall become bankrupt or shall attempt to anticipate, alienate,
sell, transfer, assign, pledge, encumber or charge any benefit payable under the
Plan or interest in the Trust Fund, then to the extent permitted by law, the
Administrative Committee in its discretion may hold or apply such benefit or
interest or any part thereof to or for the benefit of such Member, or his
Beneficiary, his spouse, children, blood relatives, or dependents, or any of
them, in such manner and in such proportions as the Administrative Committee may
consider proper. Notwithstanding the foregoing, a Member may direct that a
distribution pursuant to Article 10 or Article 11 shall be paid to the trustee
of a trust created by him for his own benefit or for the benefit of his
immediate family.

         Notwithstanding any provision in the Plan to the contrary, the Plan
shall make all payments required by a qualified domestic relations order
("QDRO") within the meaning of Code Section 4l4(o), including distributions
required or permitted by a QDRO to an alternate payee even though such payments
are with respect to a Member who has not incurred a

                                       62
<PAGE>   70

Termination of Employment Date and which commence before the Member has attained
the earliest retirement age under the Plan. The Company shall establish a
procedure to determine the qualified status of a QDRO and to administer
distributions under a QDRO.

         19.12 SEVERABILITY. If any provision of this Plan, any amendment to
this Plan or any part of such amendment is held to be invalid, illegal or
unenforceable by any court of competent jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other provision of this Plan
or any other part of such amendment.

                                   Article 20

                       Terms of Mergers or Consolidations
                       ----------------------------------

         20.1 SPIN-OFF FROM GENCORP RETIREMENT SAVINGS PLAN.

                  (a) TRANSFER. The account balances of current and former
         OMNOVA Employees in the GenCorp Retirement Savings Plan ("GenCorp
         Plan") were spun-off and merged into the Plan effective as of 12:01
         a.m. on December 1, 2000.

                  (b) ACCOUNTS. In connection with said transfer, Participants'
         balances in their Accounts in the GenCorp Plan were transferred to the
         Plan, becoming part of such Participants' corresponding Accounts in the
         Plan. Participants remain fully vested in their entire Account balances
         under the Plan, including the amounts transferred from the GenCorp
         Plan.

         20.2 SPIN-OFF FROM GENCORP PROFIT SHARING PLAN

                  (a) TRANSFER. The account balances of current and former
         OMNOVA Employees in the GenCorp Profit Sharing Retirement and Savings
         Plan ("Profit Sharing

                                       63
<PAGE>   71

         Plan") were spun-off and merged into the Plan effective as of 12:01
         a.m. on December 1, 2000.

                  (b) ACCOUNTS. In connection with said merger, Members'
         balances in their Accounts in the Profit Sharing Plan were transferred
         to the Plan, becoming part of such Members' corresponding Accounts in
         the Plan. Members remain fully vested in their entire Account balances
         under the Plan, including the amounts transferred from the Profit
         Sharing Plan.

                  (c) PRESERVATION OF RIGHTS. The rights of Members to their
         Account balances are governed by the terms of the Plan, except to the
         extent preservation of an optional form of benefit provided under the
         Profit Sharing Plan is required pursuant to Treas. Regs.
         Sec.1.411(d)-4. If so required, the relevant terms of the Profit
         Sharing Plan are deemed to be incorporated in the Plan.

         EXECUTED pursuant to the adopting resolution of the Company's Board of
Directors dated November 15, 2000.

                                           OMNOVA SOLUTIONS INC.

Date:   November 28, 2000                  /s/ Gregory T. Troy
        ----------------------             ------------------------------------
                                           By:      Gregory T. Troy
                                                    Senior Vice President,
                                                    Human Resources

/s/Robert G. Hall
-------------------------------------
Law Department Review

                                       64
<PAGE>   72

                                   SCHEDULE A

                                OMNOVA SOLUTIONS
                             RETIREMENT SAVINGS PLAN

          All categories of Employees at the locations listed below are eligible
to participate as Members of the Plan as of December 1, 2000, except Employees
represented by the unions indicated:

<TABLE>
<CAPTION>

              EMPLOYER                               WORK LOCATION                               UNION
              --------                               -------------                               -----
<S>                                    <C>                                                      <C>
OMNOVA Solutions Inc.                  Corporate Headquarters
                                       175 Ghent Road
                                       Fairlawn, OH 44333

                                       Technical Center
                                       2990 Gilchrist Road
                                       Akron, OH 44305

                                       OMNOVA Performance Chemicals Headquarters
                                       175 Ghent Road
                                       Fairlawn, OH 44333

                                       OMNOVA Performance Chemicals
                                       165 S. Cleveland Avenue
                                       Mogadore, OH 44260

                                       OMNOVA Performance Chemicals
                                       1601 Highway 41 SW
                                       Calhoun, GA 30701-3651

                                       OMNOVA Performance Chemicals
                                       1476 J. A. Cochran Bypass
                                       Chester, SC 29706
</TABLE>

                                      A-1
<PAGE>   73

<TABLE>
<CAPTION>

              EMPLOYER                               WORK LOCATION                               UNION
              --------                               -------------                               -----
<S>                                    <C>                                                      <C>

OMNOVA Solutions Inc.                  OMNOVA Performance Chemicals
(continued)                            83 Authority Drive
                                       Fitchburg, MA 01420

                                       OMNOVA Performance Chemicals
                                       1701 Cornell Road
                                       Green Bay, WI 54313

                                       OMNOVA Performance Chemicals
                                       6008 High Point Road
                                       Greensboro, NC 27407

                                       OMNOVA Performance Chemicals
                                       Latex Sales Office
                                       235 Brickyard Road
                                       Dalton, GA 30720

                                       OMNOVA Decorative & Building Products
                                       Headquarters
                                       175 Ghent Road
                                       Fairlawn, OH 44333

                                       OMNOVA Decorative & Building Products
                                       2011 Rocky River Road
                                       Monroe, NC 28110

                                       OMNOVA Decorative & Building Products
                                       133 Yorkville Road East
                                       Columbus, MS 39702

                                       OMNOVA Decorative & Building Products
                                       P.O. Box 429
                                       Auburn, PA 17922-0429
</TABLE>

                                      A-2
<PAGE>   74

<TABLE>
<CAPTION>

              EMPLOYER                               WORK LOCATION                               UNION
              --------                               -------------                               -----
<S>                                    <C>                                                      <C>

OMNOVA Solutions Inc.                  OMNOVA Decorative & Building Products
(continued)                            Sales Office
                                       2201 Coronation Boulevard
                                       Suite 190
                                       Charlotte, NC 28227

                                       OMNOVA Decorative & Building Products
                                       Sales Office
                                       1359 Broadway, 20th Floor
                                       New York, NY 10018

                                       OMNOVA Decorative & Building Products
                                       Wallcovering
                                       10 Bloomfield Avenue
                                       Pine Brook, NJ 07058

                                       OMNOVA Decorative & Building Products
                                       Design Center
                                       5 Northeastern Blvd.
                                       Salem, NH 03079

                                       OMNOVA Decorative & Building Products
                                       1722 Indianwood Circle, Suite A
                                       Maumee, OH 43537

OMNOVA Services Inc.                   As directed
</TABLE>

                                      A-3
<PAGE>   75

                                   SCHEDULE B

                                OMNOVA SOLUTIONS
                             RETIREMENT SAVINGS PLAN

         Following is a description of each of the three Investment Funds as of
the Effective Date.

         1.       DIVERSIFIED EQUITY FUND

                  (a) INVESTMENT: Contributions to the Diversified Equity Fund
will be invested primarily in the common stocks and other equity securities of
companies included in Standard and Poor's 500 Index and/or one or more funds
designed to match the performance of and changes in Standard and Poor's 500
Index. All earnings on and proceeds from the sale or disposition of assets held
in the Diversified Equity Fund shall be invested in the Diversified Equity Fund.
A portion of the funds in the Diversified Equity Fund may be held in cash or
other short-term investments as provided in Section 6.4.

         (b) OBJECTIVE: The primary objective of the Diversified Equity Fund
will be to provide the opportunity to participate in the increase, if any, in
the value of the common stocks and other equity securities of relatively large
corporations and minimize investment risk by investing funds in a diverse number
of common stocks and other equity securities of relatively large companies.

         2.       OMNOVA STOCK FUND.

         (a) INVESTMENT: Contributions to the OMNOVA Fund will be invested in
Shares of OMNOVA Solutions Inc. which may be purchased in the open market or
from OMNOVA Solutions Inc. at their fair market value on the date of purchase. A
portion of the OMNOVA Stock Fund may be held in cash or other short-term
investments as provided in Section 6.4.

         (b) OBJECTIVE: The primary objective of the OMNOVA Stock Fund will be
to encourage Members to become shareholders of OMNOVA Solutions Inc. and align
their interests as shareholders and employees of OMNOVA Solutions Inc.

         3.       INTEREST INCOME FUND

         (a) INVESTMENT: Contributions to the Interest Income Fund will be
invested primarily in one or more investment contracts with one or more banks,
insurance companies or other financial institutions, which contain provision for
payment of a guaranteed minimum rate of interest on the principal amount of such
investment during a specified period of time and protection of such principal
amount from risk of loss, except in certain limited circumstances and,
secondarily, in securities and obligations of the US Government corporations
which yield a fixed rate of interest on the principal amount thereof during a
specified period of time. A portion

                                      B-1
<PAGE>   76

of the funds in the Interest Income Fund may be held in cash or other short-term
investments as provided in Section 6.4.

         (b) OBJECTIVE: The primary objective of the Interest Income Fund will
be to produce relatively high income yields at fixed rates of interest and
minimize the risk of loss of the principal amounts of investments and earnings
thereon.

           4.     BALANCED FUND

           (a) INVESTMENT. Contributions to the Balanced Fund will be invested
  in both (i) common stocks and other equity securities of companies included in
  Standard and Poor"s 500 Index (ii) and investment-grade fixed income
  securities of over a year in maturity of the U.S. Government and its agencies,
  publicly issued debt of U.S. companies, U.S. dollar-denominated debt of
  foreign governments issued in the U.S., and mortgage pass-through securities
  issued by the Federal National Mortgage Corporation (Fannie Mae), Federal Home
  Loan Mortgage Corporation (Freddie Mac), and the Government National Mortgage
  Association (Ginny Mae). All earnings on and proceeds from the sale or
  disposition of assets held in the Balanced Fund shall be invested in the
  Balanced Fund. A portion of the funds in the Balanced Fund may be held in cash
  or other short-term investments as provided in Section 6.4.

           (b) OBJECTIVE: The primary objective of the Balanced Fund is to
  participate in the increase, if any, in the value of common stocks and other
  equity securities of a diversified portfolio of relatively large corporations
  and to produce income and possibly capital gains from fixed income securities

           5.     INTERNATIONAL EQUITY FUND

           (a) INVESTMENT: Contributions to the International Equity Fund will
  be invested in the companies included in the Morgan Stanley Capital
  International Europe, Australia, and Far East Index (EAFE Index). All earnings
  on and proceeds from the sale or disposition of assets held in the
  International Equity Fund shall be invested in the International Equity Fund.
  A portion of the funds in the International Equity Fund may be held in cash or
  other short-term investments as provided in Section 6.4.

           (b) OBJECTIVE: The primary objective of the International Equity
  Fund is to provide an opportunity to participate in the increase, if any, in
  the value of common stocks of a diversified portfolio of non-U.S.
  corporations.

           6.     DIVERSIFIED BOND FUND

           (a) INVESTMENT. Contributions to the Diversified Bond Fund will be
  invested in investment-grade fixed income securities of over a year in
  maturity of the U.S. Government and its agencies, publicly issued debt of U.S.
  companies, U.S. dollar-denominated debt of foreign

                                      B-2
<PAGE>   77

  governments issued in the U.S., and mortgage pass-through securities issued by
  the Federal National Mortgage Corporation (Fannie Mae), Federal Home Loan
  Mortgage Corporation (Freddie Mac), and the Government National Mortgage
  Association (Ginny Mae), in a manner designed to match the performance of and
  changes in the Lehman Brothers Aggregate Bond Index. All earnings on and
  proceeds from the sale or disposition of assets held in the Diversified Bond
  Fund shall be invested in the Diversified Bond Fund. A portion of the funds in
  the Diversified Bond Fund may be held in cash or other short-term investments
  as provided in Section 6.4.

           (b) OBJECTIVE. The primary objective of the Diversified Bond Fund is
  to produce income and possibly capital gains from investing in a broadly
  diversified portfolio of fixed income securities.

           7.     SHORT-TERM INVESTMENT FUND

           (a) INVESTMENT. Contributions to the Short-Term Investment Fund will
  be invested in short-term securities with relatively little market (interest
  rate) risk. The maturities of securities in the Fund will normally be limited
  to one year with an average maturity of 30 to 60 days. Like most money market
  funds, the Fund will invest in a diversified portfolio of securities, or in a
  commingled fund investing in such securities, including, but not limited to,
  U.S. Treasury Bills and Notes, Corporate Notes and Commercial Paper,
  Certificates of Deposit, and Floating-Rate Notes. All earnings on and proceeds
  from the sale or disposition of assets held in the Short-Term Investment Fund
  shall be invested in the Short-Term Investment Fund. A portion of the funds in
  the Short-Term Investment Fund may be held in cash as provided in Section 6.4.

           (b) OBJECTIVE. The primary objective of the Short-Term Investment
  Fund is to maximize investment returns while focusing on the preservation of
  principal. The Fund is not intended to track any single fixed income index.

         8.       GENCORP STOCK FUND

         (a) INVESTMENT: Assets in the GenCorp Stock Fund are invested in shares
of common stock of GenCorp Inc. A portion of the GenCorp Stock Fund may be held
in cash or other short-term investments as provided in Section 6.4.

         (b) OBJECTIVE:  The GenCorp Stock Fund is closed to new contributions.

                                      B-3

<PAGE>   78

                                   APPENDIX A

                                OMNOVA SOLUTIONS
                             RETIREMENT SAVINGS PLAN

                         NONDISCRIMINATION REQUIREMENTS
                         ------------------------------

           A.1    EXCESS DEFERRALS.

                    (a) LIMIT ON 401(k) CONTRIBUTIONS. Notwithstanding the
provisions of Article 4, a Member's 401(k) Contributions (as defined in this
Section A.l(a)) for any taxable year of such Member shall not exceed $7,000 (as
such amount may be adjusted for increases in the cost of living pursuant to
regulations prescribed by the Secretary of the Treasury). Except as otherwise
provided in this Section, the term "401(k) Contributions" for purposes of this
Appendix means and includes (i) any employer contribution made under any
qualified cash or deferred arrangement as defined in Code section 401(k) to the
extent not includible in gross income for the taxable year under Code section
402(e)(3) (determined without regard to Code section 402(g)), (ii) any employer
contribution to the extent not includible in gross income for the taxable year
under Code section 402(h)(1)(B) (determined without regard to Code section
402(g)), and (iii) any employer contribution to purchase an annuity contract
under Code section 403(b) under a salary reduction agreement within the meaning
of Code section 3121(a)(5)(D); and "401(a) Contributions" means and includes a
Member's After-Tax Contributions (as defined in Article l).

                    (b) DISTRIBUTION OF EXCESS DEFERRALS. If a Member's 401(k)
Contributions exceed the amount described in Section A.1(a) (hereinafter called
"excess deferrals"), such excess deferrals (and any income allocable thereto)
will be distributed to the Member by April 1 following the close of the taxable
year in which such excess deferrals occurred if (and only if) by March 1
following the close of such taxable year, the Member (i) allocates the amount of
such excess deferrals among the plans under which the excess deferrals were made
and (ii) notifies the Administrative Committee of the portion allocated to this
Plan. The amount of excess deferrals that may be distributed with respect to a
Member for a taxable year shall be reduced by any excess contributions (as
defined in Section A.2(d)) previously distributed or recharacterized with
respect to such Member for the Plan Year beginning with or within such taxable
year.

                    (c) RETURN OF MATCHING CONTRIBUTIONS. If a Member's 401(k)
Contributions under this Plan exceed the amount described in Section A.1(a), or
if a Member's 401(k) Contributions made under this Plan do not exceed such
amount but he allocates a portion of his excess deferrals to his 401(k)
Contributions made to this Plan, Matching Contributions, if any, made with
respect to such 401(k) Contributions (and any income applicable thereto) shall
be forfeited and used to reduce subsequent cash payments of Matching
Contributions in accordance with Section 5.2.

                                      AA-1
<PAGE>   79

  A.2 EXCESS 401(k) CONTRIBUTIONS.

                  (a) ACTUAL DEFERRAL PERCENTAGE TEST. Notwithstanding the
provisions of Article 4 or Article 5, for any Plan Year,

           (i) the actual deferral percentage (as defined in Section A.2(b) for
  the group of eligible Highly Compensated Employees for such Plan Year shall
  not exceed the actual deferral percentage for all other Eligible Employees for
  such Plan Year multiplied by 1.25, or

           (ii) the excess of the actual deferral percentage for the group of
  eligible Highly Compensated Employees (as defined in Section A.2(c)) for such
  Plan Year over the actual deferral percentage for all other Eligible Employees
  for such Plan Year shall not exceed 2 percentage points, and the actual
  deferral percentage for the group of eligible Highly Compensated Employees for
  such Plan Year shall not exceed the actual deferral percentage for all other
  Eligible Employees for such Plan Year multiplied by 2.

If two or more plans which include cash or deferred arrangements are considered
as one plan for purposes of Code section 401(a)(4) or 410(b), such arrangements
included in such plans shall be treated as one arrangement for the purposes of
this Section. If any eligible Highly Compensated Employee is a participant under
two or more cash or deferred arrangements of the Controlled Group, all such
arrangements shall be treated as one cash or deferred arrangement for purposes
of determining the deferral percentage with respect to such eligible Highly
Compensated Employee.

                  (b) DEFINITION OF ACTUAL DEFERRAL PERCENTAGE. For the purposes
of this Appendix, the actual deferral percentage for a specified group of
Eligible Employees for a Plan Year shall be the average of the ratios
(calculated separately for each Eligible Employee in such group) of (i) the
amount of 401(k) Contributions actually allocated to the Accounts of each such
Eligible Employee for such Plan Year (including any "excess deferrals" described
in Section A.1) to (ii) the Eligible Employee's compensation for such Plan Year.
For the purposes of this Section A.2(b), the term "compensation" shall mean an
Eligible Employee's compensation from an Employer that is required to be
reported as wages on the Eligible Employees' Form W-2 for income tax purposes.
For purposes of determining the actual deferral percentage test, 401(k)
Contributions must be made before the last day of the twelve-month period
immediately following the Plan Year to which such contributions relate and must
be allocated to the Member's Account as of a date within the Plan Year to which
such contributions relate.

                  (c) DEFINITION OF ELIGIBLE HIGHLY COMPENSATED EMPLOYEE. For
the purposes of this Appendix, the term "eligible" Highly Compensated Employee
means a Highly Compensated Employee eligible to become a Member under Article 2.

                    (d) TREATMENT OF EXCESS CONTRIBUTIONS. If excess
contributions (as such term is hereinafter defined) are made to the Trust for
any Plan Year, then such contributions, to the extent permitted in Treasury
Regulations, shall be recharacterized for purposes of Section A.2.

                                      AA-2
<PAGE>   80

Before-Tax Contributions shall be recharacterized as After-Tax Contributions.
For the purposes of this Section A.2(d), the term "excess contributions" shall
mean, for any Plan Year, the excess of (A) the aggregate amount of 401(k)
Contributions allocated to the Accounts of eligible Highly Compensated Employees
for such Plan Year over (B) the maximum amount of such 401(k) Contributions
permitted for such Plan Year under Section A.2(a), determined by reducing 401(k)
Contributions allocated to the Accounts of eligible Highly Compensated Employees
in order of the actual deferral percentages (as defined in Section A.2(b))
beginning with the highest of such percentages. Such reductions shall be made
pursuant to non-discriminatory rules adopted by the Administrative Committee
consistent with applicable law. Excess contributions that cannot be
recharacterized as 401(a) Contributions, and any income allocable thereto, shall
be designated as such and distributed to the Highly Compensated Employee as soon
as practicable but in any event prior to the end of the following Plan Year on
the basis of the respective portions of the excess contributions attributable to
each such Member. The amount of excess contributions to be recharacterized or
distributed under this Section A.2(d) with respect to an eligible Highly
Compensated Employee for a Plan Year shall be reduced by any excess deferrals
previously distributed to such Employee for his taxable year ending with or
within such Plan Year.

                    (e) FORFEITURE OF MATCHING CONTRIBUTIONS. Matching
Contributions made with respect to a Member's excess contributions that are not
recharacterized as After-Tax Contributions (and any income allocable thereto)
shall be forfeited (if forfeitable) and applied to reduce subsequent cash
payments of Matching Contributions in accordance with Section 5.2.

           A.3 EXCESS MATCHING AND 401(a) CONTRIBUTIONS.

                    (a) CONTRIBUTION PERCENTAGE TEST. Notwithstanding the
provisions of Article 4 or Article 5, for any Plan Year the contribution
percentage (as defined in Section A.3(b)) for the group of eligible Highly
Compensated Employees for such Plan Year shall not exceed the greater of (i) 125
percent of the contribution percentage for all other eligible Employees or (ii)
the lesser of 200 percent of the contribution percentage for all other Eligible
Employees or the contribution percentage for all other Eligible Employees plus 2
percentage points. If two or more plans of the Controlled Group to which
Matching Contributions, 401(a) contributions or 401(k) Contributions (as defined
in Section A.1(a)) are made are treated as one plan for purposes of Code section
410(b), such plans shall be treated as one plan for purposes of this Appendix
A.3(a); and if an eligible Highly Compensated Employee participates in two or
more plans of the Controlled Group to which such contributions are made, all
such contributions shall be aggregated for purposes of this Appendix A.3(a).

                  If one or more Highly Compensated Employees participate in
both a cash or deferred arrangement and a plan subject to the contribution
percentage test maintained by an Employer, the sum of the actual deferral
percentage and contribution percentage of those Highly Compensated Employees who
also participate in a cash or deferred arrangement will be reduced (beginning
with such Highly Compensated Employee whose contribution percentage is the
highest) so that the "aggregate limit" is not exceeded. The amount by which each
Highly Compensated Employee's contribution percentage amount is reduced will be
treated as an excess

                                      AA-3
<PAGE>   81

aggregate contribution. The actual deferral percentage and contribution
percentage of the Highly Compensated Employees are determined after any
corrections required to meet the actual deferral percentage and contribution
percentage tests. Multiple use does not occur if both the actual deferral
percentage and the contribution percentage of the Highly Compensated Employees
do not exceed 1.25 times the actual deferral percentage and contribution
percentage of the non-Highly Compensated Employees. For purposes of this Section
A.3, "aggregate limit" means the greater of the sum of (i) 1.25 times the
greater of the actual deferral percentage of non-Highly Compensated Employees
for the Plan Year or the contribution percentage of non-Highly Compensated
Employees for the Plan Year beginning with or within the Plan Year of the cash
or deferred arrangement; and (ii) the lesser of two times or two plus the lesser
of such actual deferral percentage or contribution percentage.

                    (b) DEFINITION OF CONTRIBUTION PERCENTAGE. For the purposes
of this Section, the contribution percentage for a specified group of Eligible
Employees for a Plan Year shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of (i) the sum of the
Matching Contributions and After-Tax Contributions paid under the Plan by or on
behalf of each such Eligible Employee for such Plan Year to (ii) the Eligible
Employee's compensation (as defined in Section A.2(b)) for such Plan Year.

                    (c) TREATMENT OF EXCESS AGGREGATE CONTRIBUTIONS. If excess
aggregate contributions (as such term is hereinafter defined) are made to the
Trust for any Plan Year, then, as soon as practicable but in any event prior to
the end of the following Plan Year, such excess aggregate contributions (and any
income allocable thereto) shall be forfeited (if forfeitable) and applied to
reduce the cash payment of future contributions allocable as Matching
Contributions or (if not forfeitable) shall be designated as such and
distributed to the eligible Highly Compensated Employees on the basis of the
respective portions of the excess contributions attributable to each such
Employee. For the purposes of this Section A.3(c), the term "excess aggregate
contributions" shall mean, for any Plan Year, the excess of (i) the aggregate
amount of the contributions allocated as Matching Contributions and Member's
401(a) Contributions actually paid to the Trust Fund by or on behalf of eligible
Highly Compensated Employees for such Plan Year over (ii) the maximum amount of
such contributions allocated as Matching Contributions and Member's 401(a)
Contributions permitted for such Plan Year under Section A.3(a), determined by
reducing contributions allocable as Matching Contributions and Member's 401(a)
Contributions made by or on behalf of eligible Highly Compensated Employees in
order of their contribution percentages (as defined in Section A.3(b)) beginning
with the highest of such percentages. Such reductions shall be made pursuant to
non-discriminatory rules adopted by the Administrative Committee that are
consistent with applicable law.

                    (d) ORDER OF DETERMINATIONS. The determination of excess
aggregate contributions under this Section shall be made after (i) first
determining the excess deferrals under Section A.1 and (ii) then determining the
excess contributions under Section A.2.

           A.4    MONITORING PROCEDURES.

                                      AA-4

<PAGE>   82

                    (a) MONITORING ACTUAL DEFERRAL PERCENTAGES AND CONTRIBUTION
PERCENTAGES. In order to ensure that the requirements specified in Section
A.2(a) and Section A.3(a) are satisfied for each Plan Year, the Company will
monitor (or cause to be monitored) the amount of Employee Contributions and
Employer contributions allocable as Matching Contributions being made to the
Plan by or for each Eligible Employee during each Plan Year. If the Company
determines that either of such requirements will not be satisfied for a Plan
Year, the Employee Contributions or the Employer contributions allocated as
Matching Contributions or both made thereafter by or for each eligible Highly
Compensated Employee will be reduced to the extent necessary to decrease the
actual deferral percentage and/or the contribution percentage for eligible
Highly Compensated Employees for such Plan Year to a level which satisfies
either of the actual deferral percentage test and/or the contribution percentage
test. Such reductions will be made in 1% increments pursuant to
non-discriminatory rules adopted by the Administrative Committee.

                    (b) PREVENTING EXCESS DEFERRALS. In order to ensure that
excess deferrals (as such term is defined in Section A.1(b)) will not be made to
the Plan for any taxable year for any Member, the Company will monitor (or cause
to be monitored) the amount of 401(k) Contributions being made to the Plan for
each Member during each taxable year and will take such action (pursuant to
non-discriminatory rules adopted by the Administrative Committee) to prevent
Member's 401(k) Contributions made for any Member under the Plan for any taxable
year from exceeding the maximum amount applicable under Section A.1(a). To the
extent allowable under Section A.3, the percent of Compensation so reduced shall
be redesignated as an After-Tax Contribution, and such redesignation shall not
be subject to the six month waiting period imposed under Section 4.2.

                                      AA-5
<PAGE>   83

                                   APPENDIX B

                                OMNOVA SOLUTIONS
                             RETIREMENT SAVINGS PLAN

                           LIMITATIONS ON ALLOCATIONS
                           --------------------------

           B.1 PRIORITY OVER OTHER ALLOCATION PROVISIONS. The provisions set
forth in this Appendix will supersede any conflicting provisions of Articles 4
or 5.

           B.2 DEFINITIONS USED IN THIS APPENDIX. The following words and
phrases, when used with initial capital letters, will have the meanings set
forth below.

                    (a) "ANNUAL ADDITION" means the sum of the following amounts
with respect to all Qualified Plans and Welfare Benefit Funds maintained by the
Controlled Group Members:

                    (i) the amount of Controlled Group Member contributions with
respect to the Limitation Year allocated to the Member's Account, including any
such contributions that are distributed to him or forfeited pursuant to Section
A.3(c) or forfeited pursuant to Section A.2(e);

                    (ii) the amount of any forfeitures for the Limitation Year
allocated to the Member's Account;

                    (iii) the amount, if any, carried forward pursuant to
Section B.4 or a similar provision in another Qualified Plan and allocated to
the Member's Account;

                    (iv) the amount of a Member's voluntary nondeductible
contributions for the Limitation Year;

                    (v) the amount allocated to an individual medical benefit
account (as defined in Code section 415(1)(2)) which is part of a pension plan
or an annuity plan; and

                    (vi) the amount derived from contributions paid or accrued
that are attributable to post-retirement medical benefits allocated to the
separate account of a key employee (as defined in Code section 4l9A(d)(3)) under
a Welfare Benefit Fund.

           A Member's Annual Addition will not include any nonvested amounts
restored to his Account following his reemployment pursuant to Section 9.3.

                    (b) "DEFINED BENEFIT DOLLAR LIMITATION" means for any
Limitation Year, $90,000 or such amount as determined by the Commissioner of
Internal Revenue under Code section 415(d)(1) as of the January 1 falling within
such Limitation Year.

                                      AB-1
<PAGE>   84

                    (c) "DEFINED BENEFIT FRACTION" means a fraction, the
numerator of which is the Projected Annual Benefit of a Member under all Defined
Benefit Plans maintained by a Controlled Group Member determined as of the close
of the Limitation Year and the denominator of which is the lesser of (i) 140% of
the Member's average Includible Compensation that may be taken into account for
the Limitation Year under Code section 415(b)(1)(B), or (ii) 125% of the Defined
Benefit Dollar Limitation, determined as of the close of the Limitation Year. If
the Member was a participant in a Defined Benefit Plan maintained by a
Controlled Group Member in existence on July 1, 1982, or on May 6, 1986, the
denominator of the Defined Benefit Fraction will not be less than 125% of the
greater of the Member's accrued Projected Annual Benefit under such plan as of
the end of the last Limitation Year beginning before January 1, 1983, or his
accrued Projected Annual Benefit, as of the end of the last Limitation Year
beginning January 1, 1987. The preceding sentence applies only if the Defined
Benefit Plan satisfied the requirements of Code section 415 as in effect at the
end of such Limitation Year.

                    (d) "DEFINED BENEFIT PLAN" means a Qualified Plan other than
a Defined Contribution Plan.

                    (e) "DEFINED CONTRIBUTION DOLLAR LIMITATION" means for any
Limitation Year, $30,000 or, if greater, 25% of the Defined Benefit Dollar
Limitation for the same Limitation Year. If a short Limitation Year is created
because of a Plan amendment changing the Limitation Year to a different
12-consecutive month period, the Defined Contribution Dollar Limitation for the
short Limitation Year shall not exceed the amount determined in the preceding
sentences multiplied by a fraction, the numerator of which is the number of
months in the short Limitation Year and the denominator of which is 12.

                    (f) "DEFINED CONTRIBUTION FRACTION" means a fraction, the
numerator of which is the sum of the Annual Additions allocated to the Member's
Account for the applicable Limitation Year and each prior Limitation Year, and
the denominator of which is the sum of the lesser of the following products for
each Limitation Year in which the Member was an Employee (regardless of whether
a Defined Contribution Plan was in existence for such Limitation Year) (i) the
Defined Contribution Dollar Limitation (determined for this purpose without
regard to the provisions of Code section 415(c)(6)) effective for the Limitation
Year multiplied by 125%, or (ii) 35% of the Member's Includible Compensation for
such Limitation Year.

                    (g) "DEFINED CONTRIBUTION PLAN" means a Qualified Plan
described in Code section 414(i).

                    (h) "INCLUDIBLE COMPENSATION" means an Employee's total
wages from the Controlled Group as determined for purposes of Internal Revenue
Service Form W-2, excluding, however: (i) moving expense reimbursements that are
deductible by the Employee under Code section 217, (ii) contributions of
Controlled Group Members to a simplified employee pension plan to the extent
such contributions are deductible by the Employee and contributions of

                                      AB-2
<PAGE>   85

Controlled Group Members to any other plan of deferred compensation that are not
includible in the Employee's gross income, (iii) distributions to the Employee
from any plan of deferred compensation other than an unfunded, nonqualified plan
of deferred compensation, (iv) amounts realized from the exercise of a
nonqualified stock option, (v) amounts realized under Code section 83 with
respect to restricted property that becomes freely transferable or is no longer
subject to a substantial risk of forfeiture, (vi) amounts realized from the
disposition of stock acquired under a qualified stock option within the meaning
of Code section 422, and (vii) any other amounts that receive special tax
benefits within the meaning of section 1.415-2(d)(2) of the Treasury
Regulations.

                    (i) "LIMITATION YEAR" means the 12-consecutive-month period
used by a Qualified Plan for purposes of computing the limitations on benefits
and annual additions under Code section 415. The Limitation Year for this Plan
is the calendar year.

                    (j) "MAXIMUM ANNUAL ADDITION" means with respect to a Member
for any Limitation Year an amount equal to the lesser of (i) the Defined
Contribution Dollar Limitation or (ii) 25% of the Member's Includible
Compensation.

                    (k) "PROJECTED ANNUAL BENEFIT" means the annual benefit (as
defined in Code section 415(b)(2)) to which a Member would be entitled under the
terms of a Defined Benefit Plan maintained by a Controlled Group Member,
assuming that the Member will continue employment until his normal retirement
age under the Defined Benefit Plan (or current age, if later) and that the
Member's Includible Compensation for the current Limitation Year and all other
relevant factors used to determine benefits under the Defined Benefit Plan will
remain constant for all future Limitation Years.

                    (l) "WELFARE BENEFIT FUND" means an organization described
in paragraph (7), (9), (17) or (20) of Code section 501(c), a trust, corporation
or other organization not exempt from federal income tax, or to the extent
provided in Treasury Regulations, any account held for an employer by any
person, which is part of a plan of an employer through which the employer
provides benefits to employees or their beneficiaries, other than a benefit to
which Code sections 83(h), 404 (determined without regard to section 404(b)(2))
or 404A applies, or to which an election under Code section 463 applies.

           B.3 GENERAL LIMITATION. The Annual Addition of a Member for any
Limitation Year shall not exceed the Maximum Annual Addition. If, except for the
application of this section, the Annual Addition of a Member for any Limitation
Year would exceed the Maximum Annual Addition, the excess Annual Addition
attributable to this Plan will not be allocated to the Member's Account for the
Plan Year included in such Limitation Year, but will be subject to the
provisions of Section B.4. The limitations contained in this Appendix will apply
on an aggregate basis to all Defined Contribution Plans and all Defined Benefit
Plans (whether or not any of such plans have terminated) established by the
Controlled Group Members.

                                      AB-3
<PAGE>   86

           B.4    EXCESS ALLOCATIONS.

                    (a) MEMBERS COVERED BY ONE DEFINED CONTRIBUTION PLAN. If the
Member is not covered under another Defined Contribution Plan or a Welfare
Benefit Fund maintained by a Controlled Group Member during the Limitation Year
and the amount otherwise allocable to his Account would exceed the Maximum
Annual Addition, his Supplemental After-Tax Contributions shall be returned to
him to the extent necessary to insure that this limit is not exceeded. If the
allocated amounts nonetheless continue to exceed the Maximum Annual Addition,
the Matching Contributions and forfeitures which would cause the Member's Annual
Addition to exceed the Maximum Annual Addition will be successively allocated in
the manner described in Section 5.4 among the Accounts of eligible Members whose
Annual Additions do not exceed the Maximum Annual Addition. If, after such
allocations have been made, there remain Matching Contributions or forfeitures
which cannot be allocated without causing the Annual Addition of a Member to
exceed the Maximum Annual Addition, the forfeitures which cause the Annual
Addition to exceed the Maximum Annual Addition and the Matching Contributions
which result from a reasonable error in estimating the Member's Includible
Compensation or from any other limited facts and circumstances which the
Commissioner of Internal Revenue finds justifiable under section 1.415-6(b)(6)
of the Treasury Regulations and which cause the Member's Annual Addition to
exceed the Maximum Annual Addition will be held in a suspense account in the
Trust Fund to be carried forward and allocated in subsequent Limitation Years as
provided in Section 5.4. Such suspense account will not participate in the
allocation of the net income or net loss of the Trust Fund.

                    (b) MEMBERS COVERED BY TWO OR MORE DEFINED CONTRIBUTION
PLANS. If, in addition to this Plan, the Member is covered under another Defined
Contribution Plan or a Welfare Benefit Fund maintained by a Controlled Group
Member during the Limitation Year, the following provisions will apply. The
Annual Addition which may be credited to a Member's Account under this Plan for
any such Limitation Year will not exceed the Maximum Annual Addition reduced by
the Annual Addition credited to a Member's accounts under the other Defined
Contribution Plans and Welfare Benefit Funds for the same Limitation Year. If
the Annual Addition with respect to the Member under the other Defined
Contribution Plans and Welfare Benefit Funds maintained by a Controlled Group
Member is less than the Maximum Annual Addition and the Matching Contribution
that would otherwise be contributed or allocated to the Member's Account under
this Plan would cause the Annual Addition for the Limitation Year to exceed the
Maximum Annual Addition, the amount to be contributed or allocated to the
Member's Account under this Plan will be reduced so that the Annual Addition
under all such Defined Contribution Plans and Welfare Benefit Funds for the
Limitation Year will equal the Maximum Annual Addition. If the aggregate Annual
Addition with respect to the Member under such other Defined Contribution Plans
and Welfare Benefit Funds is equal to or greater than the Maximum Annual
Addition, no amount will be contributed or allocated to the Member's Account
under this Plan for the Limitation Year. An excess Annual Addition will be
reduced in the manner described in Section B.4(c).

                                      AB-4
<PAGE>   87

                    (c) REDUCTION OF EXCESS ALLOCATIONS. As soon as is
administratively feasible after the end of the Limitation Year, the Maximum
Annual Addition for the Limitation Year will be determined on the basis of the
Member's Includible Compensation for the Limitation Year. If a Member's Annual
Addition under this Plan and the other Defined Contribution Plans and Welfare
Benefit Funds maintained by Controlled Group Members would result in the Annual
Addition exceeding the Maximum Annual Addition for the Limitation Year, the
excess amount will be deemed to consist of the Annual Addition last allocated.
In making this determination, the Annual Addition attributable to a Welfare
Benefit Fund will be deemed to have been allocated first regardless of the
actual date of allocation. If an excess amount was allocated to a Member on an
allocation date of this Plan that coincides with an allocation date of another
plan, the excess amount attributed to this Plan will be the product of (i) the
total excess amount allocated as of such date and (ii) the ratio of the Annual
Addition allocated to the Member for the Limitation Year as of such date under
this Plan to the total Annual Addition allocated to the Member for the
Limitation Year as of such date under this and all the other Defined
Contribution Plans. Any excess amount attributed to this Plan will be disposed
of in the manner described in Appendix B.4(a).

           B.5 AGGREGATE BENEFIT LIMITATION. If a Controlled Group Member
maintains, or at any time maintained, one or more Defined Benefit Plans covering
any Member in this Plan, the sum of the Defined Benefit Fraction and the Defined
Contribution Fraction for any Limitation Year will equal no more than one (1.0).
The provisions of the Defined Benefit Plans will govern the order of reduction
of Annual Additions or benefit accruals necessary, to meet this limitation. If
the provisions of the Defined Benefit Plans are silent, the current Annual
Addition under this Plan will be reduced first, and then the rate of accrual
under the Defined Benefit Plans will be reduced, if necessary to meet this
limitation. If the Defined Contribution Plans taken into account in determining
the Member's Annual Addition under this Appendix satisfied the requirements of
Code section 415 as in effect for all Limitation Years beginning before January
1, 1987, an amount will be subtracted from the numerator of the Defined
Contribution Fraction (not exceeding such numerator) as prescribed by the
Secretary of the Treasury so that the sum of the Defined Contribution Fraction
and the Defined Benefit Fraction does not exceed 1.0. For purposes of this
Section, a Member's voluntary nondeductible contributions to a Defined Benefit
Plan will be treated as being part of a separate Defined Contribution Plan.

           B.6 AGGREGATION OF PLANS. For purposes of this Appendix, all Defined
Benefit Plans ever maintained by a Controlled Group Member will be treated as
one Defined Benefit Plan, and all Defined Contribution Plans ever maintained by
a Controlled Group Member will be treated as one Defined Contribution Plan.

                                      AB-5

<PAGE>   88

                                   APPENDIX C

                                /OMNOVA SOLUTIONS
                             RETIREMENT SAVINGS PLAN

                              TOP-HEAVY PROVISIONS
                              --------------------

           C.1 PRIORITY OVER OTHER PLAN PROVISIONS. If the Plan is or becomes a
Top-Heavy Plan in any Plan Year, the provisions of this Appendix will supersede
any conflicting provisions of the Plan. However, the provisions of this Appendix
C will not operate to increase the rights or benefits of Members under the Plan
except to the extent required by Code section 416 and other provisions of law
applicable to Top-Heavy Plans.

           C.2 DEFINITIONS USED IN THIS APPENDIX. The following words and
phrases, when used with initial capital letters, will have the meanings set
forth below.

                    (a) "DEFINED BENEFIT DOLLAR LIMITATION" means the limitation
described in Appendix B.2(b).

                    (b) "DEFINED BENEFIT PLAN" means the Qualified Plan
described in Appendix B.2(d).

                    (c) "DEFINED CONTRIBUTION DOLLAR LIMITATION" means the
limitation described in Appendix B.2(e).

                    (d) "DEFINED CONTRIBUTION PLAN" means the Qualified Plan
described in Appendix B.2(g).

                    (e) "DETERMINATION DATE" means for the first Plan Year of
the Plan the last day of the Plan Year and for any subsequent Plan Year the last
day of the preceding Plan Year.

                    (f) "DETERMINATION PERIOD" means the Plan Year containing
the Determination Date and the four preceding Plan Years.

                    (g) "INCLUDIBLE COMPENSATION" means the compensation
described in Appendix B.2(h).

                    (h) "KEY EMPLOYEE" means any Employee or former Employee
(and the Beneficiary of a deceased Employee) who at any time during the
Determination Period was (i) an officer of a Controlled Group Member, if such
individual's Includible Compensation exceeds 50% of the dollar limitation under
Code section 415(b)(1)(A), (ii) an owner (or considered an owner under Code
section 318) of one of the ten largest interests in a Controlled Group

                                      AC-1
<PAGE>   89

Member, if such individual's Includible Compensation exceeds the Defined
Contribution Dollar Limitation, (iii) a 5% owner of a Controlled Group Member,
or (iv) a 1% owner of a Controlled Group Member who has annual Includible
Compensation of more than $150,000. The determination of who is a Key Employee
will be made in accordance with Code section 416(i). For purposes of this
Appendix C, 'non-Key Employee' means any Employee or former Employee (and the
Beneficiary of a deceased Employee) who is not a Key Employee.

                    (i) "MINIMUM ALLOCATION" means the allocation described in
the first sentence of Appendix C.4(a).

                    (j) "PERMISSIVE AGGREGATION GROUP" means the Required
Aggregation Group of Qualified Plans plus any other Qualified Plan or Qualified
Plans of a Controlled Group Member which, when considered as a group with the
Required Aggregation Group, would continue to satisfy the requirements of Code
sections 401(a)(4) and 410 (including simplified employee pension plans).

                    (k) "PRESENT VALUE" means present value based only on the
interest and mortality rates specified in a Defined Benefit Plan.

                    (1) "REQUIRED AGGREGATION GROUP" means the group of plans
consisting of (i) each Qualified Plan (including simplified employee pension
plans) of a Controlled Group Member in which at least one Key Employee
participates or participated at any time during the Plan Year or any of the four
preceding Plan Years (regardless of whether the Plan has terminated), and (ii)
any other Qualified Plan (including simplified employee pension plans) of a
Controlled Group Member which enables a Qualified Plan to meet the requirements
of Code sections 401(a)(4) or 410.

                    (m) "TOP-HEAVY PLAN" means the Plan for any Plan Year in
which any of the following conditions exists: (i) if the Top-Heavy Ratio for the
Plan exceeds 60% and the Plan is not a part of any Required Aggregation Group or
Permissive Aggregation Group of Qualified Plans; (ii) if the Plan is a part of a
Required Aggregation Group but not part of a Permissive Aggregation Group of
Qualified Plans and the Top-Heavy Ratio for the Required Aggregation Group
exceeds 60%; or (iii) if the Plan is a part of a Required Aggregation Group and
part of a Permissive Aggregation Group of Qualified Plans and the Top-Heavy
Ratio for the Permissive Aggregation Group exceeds 60%.

                    (n) "TOP-HEAVY RATIO" means a fraction, the numerator of
which is the sum of the Present Value of accrued benefits and the account
balances (as required by Code section 416) of all Key Employees with respect to
such Qualified Plans as of the Determination Date (including any part of any
accrued benefit or account balance distributed during the five-year period
ending on the Determination Date), and the denominator of which is the sum of
the Present Value of the accrued benefits and the account balances (including
any part of any accrued benefit or account balance distributed in the five-year
period ending on the Determination Date) of all Employees with respect to such
Qualified Plans as of the

                                      AC-2
<PAGE>   90

Determination Date. The value of account balances and the Present Value of
accrued benefits will be determined as of the most recent Top-Heavy Valuation
Date that falls within or ends with the 12-month period ending on the
Determination Date, except as provided in Code section 416 for the first and
second Plan Years of a Defined Benefit Plan. The account balances and accrued
benefits of a participant who is not a Key Employee but who was a Key Employee
in a prior year will be disregarded. The calculation of the Top-Heavy Ratio, and
the extent to which distributions, rollovers, transfers and contributions unpaid
as of the Determination Date are taken into account will be made in accordance
with Code section 416. Employee contributions described in Code section
219(e)(2) will not be taken into account for purposes of computing the Top-Heavy
Ratio. When aggregating plans, the value of account balances and accrued
benefits will be calculated with reference to the Determination Dates that fall
within the same calendar year. The accrued benefit of any Employee other than a
Key Employee will be determined under the method, if any, that uniformly applies
for accrual purposes under all Qualified Plans maintained by all Controlled
Group Members and included in a Required Aggregation Group or a Permissive
Aggregation Group or, if there is no such method, as if the benefit accrued not
more rapidly than the slowest accrual rate permitted under the fractional
accrual rate of Code section 411(b)(1)(C). Notwithstanding the foregoing, the
account balances and accrued benefits of any Employee who has not performed
services for an employer maintaining any of the aggregated plans during the
five-year period ending on the Determination Date will not be taken into account
for purposes of this Subsection.

                    (o) TOP-HEAVY VALUATION DATE means the last day of each Plan
Year.

           C.3 COMPENSATION TAKEN INTO ACCOUNT. For any Plan Year in which the
Plan is a Top-Heavy Plan, the amount of each Member's Includible Compensation
taken into account for purposes of determining allocations under the Plan will
not exceed the first $200,000 (or such larger amount as may be prescribed by the
Secretary of the Treasury or his delegate) of such Member's Includible
Compensation for such Plan Year.

           C.4 MINIMUM ALLOCATION.

                    (a) CALCULATION OF MINIMUM ALLOCATION. For any Plan Year in
which the Plan is a Top-Heavy Plan, each Member who is not a Key Employee will
receive an allocation of Matching Contributions and forfeitures of not less than
the lesser of 3% of his Includible Compensation for such Plan Year or, in the
event that the Controlled Group Members maintain no Defined Benefit Plan which
covers a Member in this Plan, the percentage of Includible Compensation that
equals the largest percentage of Matching Contributions and forfeitures
allocated to a Key Employee expressed as a percentage of the first $200,000 of
Includible Compensation received by such Key Employee in that Plan Year. For
purposes of determining the largest percentage of Matching Contributions and
forfeitures allocated to a Key Employee, elective contributions made by a Key
Employee pursuant to a Salary Reduction Agreement shall be counted as if they
were Matching Contributions. The Minimum Allocation is determined without regard
to any Social Security contribution.

                                      AC-3
<PAGE>   91

The Minimum Allocation applies even though under other Plan provisions the
Member would not otherwise be entitled to receive an allocation, or would have
received a lesser allocation for the Plan Year because (i) the non-Key Employee
fails to make mandatory contributions to the Plan, or (ii) the non-Key
Employee's Compensation is less than a stated amount.

                    (b) LIMITATION ON MINIMUM ALLOCATION. No Minimum Allocation
will be provided pursuant to Section C.4 (a) to a Member who incurred a
Termination of Employment Date during the Plan Year and who has not returned to
work and is not employed by a Controlled Group Member on the last day of the
Plan Year.

                    (c) MINIMUM ALLOCATION WHEN MEMBER IS COVERED BY ANOTHER
QUALIFIED PLAN. If a Controlled Group Member maintains one or more other Defined
Contribution Plans covering Employees who are Members in this Plan, the Minimum
Allocation will be provided under this Plan, unless such other Defined
Contribution Plans make explicit reference to this Plan and provide that the
Minimum Allocation will not be provided under this Plan, in which case the
provisions of Section C.4(a) will not apply to any Member covered under such
other Defined Contribution Plans. If a Controlled Group Member maintains one or
more Defined Benefit Plans covering Employees who are Members in this Plan, and
such Defined Benefit Plans provide that Employees who are participants therein
will accrue the minimum benefit applicable to top-heavy Defined Benefit Plans
notwithstanding their participation in this Plan (making explicit reference to
this Plan), then the provisions of Section C.4(a) will not apply to any Member
covered under such Defined Benefit Plans. If a Controlled Group Member maintains
one or more Defined Benefit Plans covering Employees who are Members in this
Plan, and the provisions of the preceding sentence do not apply, then each
Member who is not a Key Employee and who is covered by such Defined Benefit
Plans will receive a Minimum Allocation determined by applying the provisions of
Section C.4(a) with the substitution of "5%" in each place that "3%" occurs
therein.

                    (d) NONFORFEITABILITY. The Member's Minimum Allocation
required under this Section, to the extent required to be nonforfeitable under
Code section 416(b) and the special vesting schedule provided in this Appendix,
may not be forfeited under Code section 411(a)(3)(B) (relating to suspension of
benefits on reemployment) or 411(a)(3)(D) (relating to withdrawal of mandatory
contributions).

           C.5    MODIFICATION OF AGGREGATE BENEFIT LIMIT.

                    (a) MODIFICATION. Subject to the provisions of Section
C.5(b), in any Plan Year in which the Top-Heavy Ratio exceeds 60%, the aggregate
benefit limit described in Appendix B will be modified by substituting "100%"
for "125%" in Section B.2(c) and (f).

                    (b) EXCEPTION. The modification of the aggregate benefit
limit described in Section C.5(a) will not be required if the Top-Heavy Ratio
does not exceed 90% and one of the following conditions is met: (i) Employees
who are not Key Employees do not participate in both a Defined Benefit Plan and
a Defined Contribution Plan which are in the Required

                                      AC-4
<PAGE>   92

Aggregation Group, and the Minimum Allocation requirements of Section C.4(a) are
met when such requirements are applied with the substitution of "4%" for "3%";
(ii) The Minimum Allocation requirements of Section C.4(c) are met when such
requirements are applied with the substitution of "7 1/2%" for "5%"; or (iii)
Employees who are not Key Employees accrue a benefit for such Plan Year of not
less than 3% of their average Includible Compensation for the five consecutive
Plan Years in which they had the highest Includible Compensation (not to exceed
a total such benefit of 30%), expressed as a life annuity commencing at the
Member's normal retirement age in a Defined Benefit Plan which is in the
Required Aggregation Group.

           C.6    MINIMUM VESTING.

                    (a) REQUIRED VESTING. For any Plan Year in which this Plan
is a Top-Heavy Plan, the minimum vesting schedule set forth in Section C.6(b)
will automatically apply to the Plan to the extent it provides a higher vested
percentage than the regular vesting provisions set forth in Section 9.1. The
minimum vesting schedule applies to all Account balances including amounts
attributable to Plan Years before the effective date of Code section 416 and
amounts attributable to Plan Years before the Plan became a Top-Heavy Plan.
Further, no reduction in vested Account balances may occur in the event the
Plan's status as a Top-Heavy Plan changes for any Plan Year, and any change in
the effective vesting schedule from the schedule set forth in Section C.6(b) to
the regular provisions set forth in Section 9.1 will be treated as an amendment
subject to Section 16.1. However, this Section C.6(a) does not apply to the
Account balances of any Employee who does not have an Hour of Service after the
Plan has initially become a Top-Heavy Plan, and such Employee's Account balances
will be determined without regard to this Section.

                    (b)  MINIMUM VESTING SCHEDULE.
                         ------------------------

              Years of                    Percentage Vested
          Continuous Service              and Nonforfeitable
          ------------------              ------------------

       Less than 2                                      0
       2 but less than 3                               20
       3 but less than 4                               40
       4 but less than 5                               60
       5 but less than 6                               80
       6 or more                                      100

                                      AC-5EXHIBIT 4.1

                                   EXHIBIT 4.1

                                IVAX CORPORATION

                    ----------------------------------------

                                    INDENTURE

                           Dated as of ________, _____

                    ----------------------------------------

                        First Trust National Association,

                                   as Trustee

<PAGE>

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                                 Page
<S>               <C>                                                                             <C>
ARTICLE I.        DEFINITIONS AND INCORPORATION BY REFERENCE.......................................1
         Section 1.1       DEFINITIONS.............................................................1
         Section 1.2       OTHER DEFINITIONS.......................................................4
         Section 1.3       INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.......................4
         Section 1.4       RULES OF CONSTRUCTION...................................................5

ARTICLE II.       THE SECURITIES...................................................................5
         Section 2.1       ISSUABLE IN SERIES......................................................5
         Section 2.2       ESTABLISHMENT OF TERMS OF SERIES OF SECURITIES..........................5
         Section 2.3       EXECUTION AND AUTHENTICATION............................................7
         Section 2.4       REGISTRAR AND PAYING AGENT..............................................8
         Section 2.5       PAYING AGENT TO HOLD MONEY IN TRUST.....................................8
         Section 2.6       SECURITYHOLDER LISTS....................................................9
         Section 2.7       TRANSFER AND EXCHANGE...................................................9
         Section 2.8       MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES........................9
         Section 2.9       OUTSTANDING SECURITIES.................................................10
         Section 2.10      TREASURY SECURITIES....................................................10
         Section 2.11      TEMPORARY SECURITIES...................................................10
         Section 2.12      CANCELLATION...........................................................10
         Section 2.13      DEFAULTED INTEREST.....................................................11
         Section 2.14      GLOBAL SECURITIES......................................................11
         Section 2.15      CUSIP NUMBERS..........................................................12

ARTICLE III.      REDEMPTION......................................................................12
         Section 3.1       NOTICE TO TRUSTEE......................................................12
         Section 3.2       SELECTION OF SECURITIES TO BE REDEEMED.................................12
         Section 3.3       NOTICE OF REDEMPTION...................................................12
         Section 3.4       EFFECT OF NOTICE OF REDEMPTION.........................................13
         Section 3.5       DEPOSIT OF REDEMPTION PRICE............................................13
         Section 3.6       SECURITIES REDEEMED IN PART............................................13

ARTICLE IV.       COVENANTS.......................................................................13
         Section 4.1       PAYMENT OF PRINCIPAL AND INTEREST......................................13
         Section 4.2       SEC REPORTS............................................................13
         Section 4.3       COMPLIANCE CERTIFICATE.................................................14
         Section 4.4       STAY, EXTENSION AND USURY LAWS.........................................14
         Section 4.5       CORPORATE EXISTENCE....................................................14
         Section 4.6       TAXES..................................................................14

ARTICLE V.        SUCCESSORS......................................................................14
         Section 5.1       WHEN COMPANY MAY MERGE, ETC............................................14
         Section 5.2       SUCCESSOR CORPORATION SUBSTITUTED......................................15

ARTICLE VI.       DEFAULTS AND REMEDIES...........................................................15
         Section 6.1       EVENTS OF DEFAULT......................................................15
         Section 6.2       ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT.....................16
         Section 6.3       COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY TRUSTEE........17
</TABLE>
                                      -i-
<PAGE>
<TABLE>
<CAPTION>
<S>               <C>                                                                             <C>
         Section 6.4       TRUSTEE MAY FILE PROOFS OF CLAIM.......................................18
         Section 6.5       TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION
                           OF SECURITIES..........................................................18
         Section 6.6       APPLICATION OF MONEY COLLECTED.........................................18
         Section 6.7       LIMITATION ON SUITS....................................................19
         Section 6.8       UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL
                           AND INTEREST...........................................................19
         Section 6.9       RESTORATION OF RIGHTS AND REMEDIES.....................................19
         Section 6.10      RIGHTS AND REMEDIES CUMULATIVE.........................................20
         Section 6.11      DELAY OR OMISSION NOT WAIVER...........................................20
         Section 6.12      CONTROL BY HOLDERS.....................................................20
         Section 6.13      WAIVER OF PAST DEFAULTS................................................20
         Section 6.14      UNDERTAKING FOR COSTS..................................................20

ARTICLE VII.      TRUSTEE.........................................................................21
         Section 7.1       DUTIES OF TRUSTEE......................................................21
         Section 7.2       RIGHTS OF TRUSTEE......................................................22
         Section 7.3       INDIVIDUAL RIGHTS OF TRUSTEE...........................................22
         Section 7.4       TRUSTEE'S DISCLAIMER...................................................22
         Section 7.5       NOTICE OF DEFAULTS.....................................................23
         Section 7.6       REPORTS BY TRUSTEE TO HOLDERS..........................................23
         Section 7.7       COMPENSATION AND INDEMNITY.............................................23
         Section 7.8       REPLACEMENT OF TRUSTEE.................................................23
         Section 7.9       SUCCESSOR TRUSTEE BY MERGER, ETC.......................................24
         Section 7.10      ELIGIBILITY; DISQUALIFICATION..........................................24
         Section 7.11      PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY......................25

ARTICLE VIII.     SATISFACTION AND DISCHARGE; DEFEASANCE..........................................25
         Section 8.1       SATISFACTION AND DISCHARGE OF INDENTURE................................25
         Section 8.2       APPLICATION OF TRUST FUNDS; INDEMNIFICATION............................26
         Section 8.3       LEGAL DEFEASANCE OF SECURITIES OF ANY SERIES...........................26
         Section 8.4       COVENANT DEFEASANCE....................................................27
         Section 8.5       REPAYMENT TO COMPANY...................................................28

ARTICLE IX.       AMENDMENTS AND WAIVERS..........................................................28
         Section 9.1       WITHOUT CONSENT OF HOLDERS.............................................28
         Section 9.2       WITH CONSENT OF HOLDERS................................................29
         Section 9.3       LIMITATIONS............................................................29
         Section 9.4       COMPLIANCE WITH TRUST INDENTURE ACT....................................30
         Section 9.5       REVOCATION AND EFFECT OF CONSENTS......................................30
         Section 9.6       NOTATION ON OR EXCHANGE OF SECURITIES..................................30
         Section 9.7       TRUSTEE PROTECTED......................................................30

ARTICLE X.        MISCELLANEOUS...................................................................30
         Section 10.1      TRUST INDENTURE ACT CONTROLS...........................................30
         Section 10.2      NOTICES................................................................31
         Section 10.3      COMMUNICATION BY HOLDERS WITH OTHER HOLDERS............................31
         Section 10.4      CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.....................31
         Section 10.5      STATEMENTS REQUIRED IN CERTIFICATE OR OPINION..........................32
         Section 10.6      RULES BY TRUSTEE AND AGENTS............................................32
         Section 10.7      LEGAL HOLIDAYS.........................................................32
         Section 10.8      NO RECOURSE AGAINST OTHERS.............................................32
</TABLE>

                                      -ii-
<PAGE>
<TABLE>
<CAPTION>
<S>               <C>                                                                             <C>
         Section 10.9      COUNTERPARTS...........................................................32
         Section 10.10     GOVERNING LAWS.........................................................32
         Section 10.11     NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS..........................33
         Section 10.12     SUCCESSORS.............................................................33
         Section 10.13     SEVERABILITY...........................................................33
         Section 10.14     TABLE OF CONTENTS, HEADINGS, ETC.......................................33
         Section 10.15     SECURITIES IN A FOREIGN CURRENCY OR IN ECU.............................33
         Section 10.16     JUDGMENT CURRENCY......................................................34

</TABLE>

                                     -iii-
<PAGE>

                                IVAX CORPORATION

         Reconciliation and tie between Trust Indenture Act of 1939 and
                     Indenture, dated as of __________, ____

SECTION 310    (A)(1) ..................................................7.10
               (A)(2) ..................................................7.10
               (A)(3) ........................................NOT APPLICABLE
               (A)(4).........................................OT  APPLICABLE
               (A)(5) ..................................................7.10
               (B) .....................................................7.10
SECTION 311    (A)......................................................7.11
               (B) .....................................................7.11
               (C)............................................NOT APPLICABLE
 SECTION 312   (A) ......................................................2.6
               (B.......................................................10.3
               (C)......................................................10.3
 SECTION 313   (A).......................................................7.6
               (B)(1)....................................................7.6
               (B)(2)....................................................7.6
               (C)(1)....................................................7.6
               (D).......................................................7.6
 SECTION 314   (A).................................................4.2, 10.5
               (B)............................................NOT APPLICABLE
               (C)(1)...................................................10.4
               (C)(2)...................................................10.4
               (C)(3).........................................NOT APPLICABLE
               (D)............................................NOT APPLICABLE
               (E)......................................................10.5
               (F)............................................NOT APPLICABLE
SECTION 315    (A).......................................................7.1
               (B).......................................................7.5
               (C).......................................................7.1
               (D).......................................................7.1
               (E)......................................................6.14
SECTION 316    (A)......................................................2.10
               (A)(1)(A)................................................6.12
               (A)(1)(B)................................................6.13
               (B).......................................................6.8
SECTION 317    (A)(1)....................................................6.3
               (A)(2)....................................................6.4
               (B).......................................................2.5
SECTION 318    (A)......................................................10.1

Note: This reconciliation and tie shall not, for any purpose, be deemed to be
part of the Indenture.

                                      -iv-

<PAGE>

                                    INDENTURE

         Indenture dated as of ___________, ____ between IVAX Corporation, a
Florida corporation ("Company"), and First Trust National Association, as
trustee ("Trustee").

         Each party agrees as follows for the benefit of the other party and for
the equal and ratable benefit of the Holders of the Securities issued under this
Indenture.

                                   ARTICLE I.

                   DEFINITIONS AND INCORPORATION BY REFERENCE

         Section 1.1       DEFINITIONS.

                  "Additional Amounts" means any additional amounts which are
required hereby or by any Security, under circumstances specified herein or
therein, to be paid by the Company in respect of certain taxes imposed on
Holders specified therein and which are owing to such Holders.

                  "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" (including, with correlative meanings, the terms "controlled by" and
"under common control with"), as used with respect to any person, shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such person, whether through the
ownership of voting securities or by agreement or otherwise.

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

                  "Authorized Newspaper" means a newspaper in an official
language of the country of publication customarily published at least once a day
for at least five days in each calendar week and of general circulation in the
place in connection with which the term is used. If it shall be impractical in
the opinion of the Trustee to make any publication of any notice required hereby
in an Authorized Newspaper, any publication or other notice in lieu thereof that
is made or given by the Trustee shall constitute a sufficient publication of
such notice.

                  "Bearer" means anyone in possession from time to time of a
Bearer Security.

                  "Bearer Security" means any Security, including any interest
coupon appertaining thereto, that does not provide for the identification of the
Holder thereof.

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

                  "Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of the Company to have been adopted by
the Board of Directors or pursuant to authorization by the Board of Directors
and to be in full force and effect on the date of the certificate and delivered
to the Trustee.

                  "Business Day" means, unless otherwise provided by Board
Resolution, Officers' Certificate or supplemental indenture hereto for a
particular Series, any day except a Saturday, Sunday or a legal holiday in The
City of New York on which banking institutions are authorized or required by
law, regulation or executive order to close.

<PAGE>

                  "Company" means the party named as such above until a
successor replaces it and thereafter means the successor.

                  "Company Order" means a written order signed in the name of
the Company by two Officers.

                  "Company Request" means a written request signed in the name
of the Company by its Chairman of the Board, its Chief Executive Officer, its
President or any Vice President, and by its Chief Financial Officer or its
Treasurer, any Assistant Treasurer, its Secretary or an Assistant Secretary, and
delivered to the Trustee.

                  "Corporate Trust Office" means the office of the Trustee at
which at any particular time its corporate trust business shall be principally
administered.

                  "Debt" of any person as of any date means, without
duplication, all indebtedness of such person in respect of borrowed money,
including all interest, fees and expenses owed in respect thereto (whether or
not the recourse of the lender is to the whole of the assets of such person or
only to a portion thereof), or evidenced by bonds, notes, debentures or similar
instruments.

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

                  "Depository" means, with respect to the Securities of any
Series issuable or issued in whole or in part in the form of one or more Global
Securities, the person designated as Depository for such Series by the Company,
which Depository shall be a clearing agency registered under the Exchange Act;
and if at any time there is more than one such person, "Depository" as used with
respect to the Securities of any Series shall mean the Depository with respect
to the Securities of such Series.

                  "Discount Security" means any Security that provides for an
amount less than the stated principal amount thereof to be due and payable upon
declaration of acceleration of the maturity thereof pursuant to Section 6.2.

                  "Dollars" means the currency of the United States of America.

                  "ECU" means the European Currency Unit as determined by the
Commission of the European Union.

                  "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

                  "Foreign Currency" means any currency or currency unit issued
by a government other than the government of the United States of America.

                  "Foreign Government Obligations" means with respect to
Securities of any Series that are denominated in a Foreign Currency, (i) direct
obligations of the government that issued or caused to be issued such currency
for the payment of which obligations its full faith and credit is pledged or
(ii) obligations of a person controlled or supervised by or acting as an agency
or instrumentality of such government the timely payment of which is
unconditionally guaranteed as a full faith and credit obligation by such
government, which, in either case under clauses (i) or (ii), are not callable or
redeemable at the option of the issuer thereof.

                  "Global Security" or "Global Securities" means a Security or
Securities, as the case may be, in the form established pursuant to Section 2.2
evidencing all or part of a Series of Securities, issued to the Depository for
such Series or its nominee, and registered in the name of such Depository or
nominee.

                  "Holder" or "Securityholder" means a person in whose name a
Security is registered or the holder of a Bearer Security.

<PAGE>

                  "Indenture" means this Indenture as amended from time to time
and shall include the form and terms of particular Series of Securities
established as contemplated hereunder.

                  "interest" with respect to any Discount Security which by its
terms bears interest only after Maturity, means interest payable after Maturity.

                  "Maturity," when used with respect to any Security or
installment of principal thereof, means the date on which the principal of such
Security or such installment of principal becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption, notice of option to elect repayment or
otherwise.

                  "Officer" means the Chairman of the Board, the Chief Executive
Officer, any President, any Vice-President, the Chief Financial Officer, the
Treasurer, the Secretary, any Assistant Treasurer or any Assistant Secretary of
the Company.

                  "Officers' Certificate" means a certificate signed by two
Officers.

                  "Opinion of Counsel" means a written opinion of legal counsel,
which counsel may be an employee of or counsel to the Company.

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

                  "principal" of a Security means the principal of the Security
plus, when appropriate, the premium, if any, on, and any Additional Amounts in
respect of, the Security.

                  "Responsible Officer" means any officer of the Trustee in its
Corporate Trust Office and also means, with respect to a particular corporate
trust matter, any other officer to whom any corporate trust matter is referred
because of his or her knowledge of and familiarity with a particular subject.

                  "SEC" means the Securities and Exchange Commission.

                  "Securities" means the debentures, notes or other debt
instruments of the Company of any Series authenticated and delivered under this
Indenture.

                  "Series" or "Series of Securities" means each series of
debentures, notes or other debt instruments of the Company created pursuant to
Sections 2.1 and 2.2 hereof.

                  "Significant Subsidiary" means any direct or indirect
Subsidiary of the Company that would be a "significant subsidiary" as defined in
Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities
Act of 1933, as amended, as such regulation is in effect on the date hereof.

                  "Stated Maturity" when used with respect to any Security or
any installment of principal thereof or interest thereon, means the date
specified in such Security as the fixed date on which the principal of such
Security or such installment of principal or interest is due and payable.

                  "Subsidiary" of any specified person means any corporation of
which at least a majority of the outstanding stock having by the terms thereof
ordinary voting power for the election of directors of such corporation
(irrespective of whether or not at the time stock of any other class or classes
of such corporation shall have or might have

<PAGE>

voting power by reason of the happening of any contingency) is at the time
directly or indirectly owned by such person, or by one or more other
Subsidiaries, or by such person and one or more other Subsidiaries.

                  "TIA" means the Trust Indenture Act of 1939 (15 U.S. Code
Section (Section 77aaa-77bbbb) as in effect on the date of this Indenture;
provided, however, that in the event the Trust Indenture Act of 1939 is amended
after such date, "TIA" means, to the extent required by any such amendment, the
Trust Indenture Act as so amended.

                  "Trustee" means the person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each person who is then a Trustee hereunder, and
if at any time there is more than one such person, "Trustee" as used with
respect to the Securities of any Series shall mean the Trustee with respect to
Securities of that Series.

                  "U.S. Government Obligations" means securities which are (i)
direct obligations of the United States of America for the payment of which its
full faith and credit is pledged or (ii) obligations of a person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, and which in the case of (i)
and (ii) are not callable or redeemable at the option of the issuer thereof, and
shall also include a depository receipt issued by a bank or trust company as
custodian with respect to any such U.S. Government Obligation or a specific
payment of interest on or principal of any such U.S. Government Obligation held
by such custodian for the account of the holder of a depository receipt,
provided that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such depository
receipt from any amount received by the custodian in respect of the U.S.
Government Obligation evidenced by such depository receipt.

         Section 1.2       OTHER DEFINITIONS.

                                                             DEFINED IN
TERM                                                            SECTION
----                                                         ------------

"Bankruptcy Law"                                                   6.1
"Custodian"                                                        6.1
"Event of Default"                                                 6.1
"Journal"                                                         10.15
"Judgment Currency"                                               10.16
"Legal Holiday"                                                   10.7
"mandatory sinking fund payment"                                  11.1
"Market Exchange Rate"                                            10.15
"New York Banking Day"                                            10.16
"optional sinking fund payment"                                   11.1
"Paying Agent"                                                     2.4
"Registrar"                                                        2.4
"Required Currency"                                               10.16
"Service Agent"                                                    2.4
"successor person"                                                 5.1

         Section 1.3       INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.

                  Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:

                  "Commission" means the SEC.

<PAGE>

                  "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 and
any successor obligor upon the Securities.

                  All other terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule under
the TIA and not otherwise defined herein are used herein as so defined.

         Section 1.4       RULES OF CONSTRUCTION.

                  Unless the context otherwise requires:

                  (a)      a term has the meaning assigned to it;

                  (b)      an accounting term not otherwise defined has the
meaning assigned to it in accordance with generally accepted accounting
principles;

                  (c)      references to "generally accepted accounting
principles" shall mean generally accepted accounting principles in effect as of
the time when and for the period as to which such accounting principles are to
be applied;

                  (d)      "or" is not exclusive;

                  (e)      words in the singular include the plural, and in the
plural include the singular; and

                  (f)      provisions apply to successive events and
transactions.

                                   ARTICLE II.

                                 THE SECURITIES

         Section 2.1       ISSUABLE IN SERIES.

                  The aggregate principal amount of Securities that may be
authenticated and delivered under this Indenture is unlimited. The Securities
may be issued in one or more Series. All Securities of a Series shall be
identical except as may be set forth in a Board Resolution, a supplemental
indenture or an Officers' Certificate detailing the adoption of the terms
thereof pursuant to the authority granted under a Board Resolution. In the case
of Securities of a Series to be issued from time to time, the Board Resolution,
Officers' Certificate or supplemental indenture may provide for the method by
which specified terms (such as interest rate, maturity date, record date or date
from which interest shall accrue) are to be determined. Securities may differ
between Series in respect of any matters, provided that all Series of Securities
shall be equally and ratably entitled to the benefits of the Indenture.

         Section 2.2       ESTABLISHMENT OF TERMS OF SERIES OF SECURITIES.

<PAGE>

                  At or prior to the issuance of any Securities within a Series,
the following shall be established (as to the Series generally, in the case of
Subsection 2.2.1, and, either as to such Securities within the Series or as to
the Series generally, in the case of Subsections 2.2.2 through 2.2.21) by a
Board Resolution, a supplemental indenture or an Officers' Certificate pursuant
to authority granted under a Board Resolution:

                            2.2.1 the title of the Series (which shall
distinguish the Securities of that particular Series from the Securities of any
other Series);

                            2.2.2 the price or prices (expressed as a percentage
of the principal amount thereof) at which the Securities of the Series will be
issued;

                            2.2.3 any limit upon the aggregate principal amount
of the Securities of the Series which may be authenticated and delivered under
this Indenture (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other Securities
of the Series pursuant to Section 2.7, 2.8, 2.11, 3.6 or 9.6);

                            2.2.4 the date or dates on which the principal of
the Securities of the Series is payable;

                            2.2.5 the rate or rates (which may be fixed or
variable) per annum or, if applicable, the method used to determine such rate or
rates (including, but not limited to, any commodity, commodity index, stock
exchange index or financial index) at which the Securities of the Series shall
bear interest, if any, the date or dates from which such interest, if any, shall
accrue, the date or dates on which such interest, if any, shall commence and be
payable and any regular record date for the interest payable on any interest
payment date;

                            2.2.6 the place or places where the principal of and
interest, if any, on the Securities of the Series shall be payable, or the
method of such payment, if by wire transfer, mail or other means;

                            2.2.7 if applicable, the period or periods within
which, the price or prices at which and the terms and conditions upon which the
Securities of the Series may be redeemed, in whole or in part, at the option of
the Company;

                            2.2.8 the obligation, if any, of the Company to
redeem or purchase the Securities of the Series pursuant to any sinking fund or
analogous provisions or at the option of a Holder thereof and the period or
periods within which, the price or prices at which and the terms and conditions
upon which Securities of the Series shall be redeemed or purchased, in whole or
in part, pursuant to such obligation;

                            2.2.9 the dates, if any, on which and the price or
prices at which the Securities of the Series will be repurchased by the Company
at the option of the Holders thereof and other detailed terms and provisions of
such repurchase obligations;

                            2.2.10 if other than denominations of $1,000 and any
integral multiple thereof, the denominations in which the Securities of the
Series shall be issuable;

                            2.2.11 the forms of the Securities of the Series in
bearer or fully registered form (and, if in fully registered form, whether the
Securities will be issuable as Global Securities);

                            2.2.12 if other than the principal amount thereof,
the portion of the principal amount of the Securities of the Series that shall
be payable upon declaration of acceleration of the maturity thereof pursuant to
Section 6.2;

<PAGE>

                            2.2.13 the currency of denomination of the
Securities of the Series, which may be Dollars or any Foreign Currency,
including, but not limited to, the ECU, and if such currency of denomination is
a composite currency other than the ECU, the agency or organization, if any,
responsible for overseeing such composite currency;

                            2.2.14 the designation of the currency, currencies
or currency units in which payment of the principal of and interest, if any, on
the Securities of the Series will be made;

                            2.2.15 if payments of principal of or interest, if
any, on the Securities of the Series are to be made in one or more currencies or
currency units other than that or those in which such Securities are
denominated, the manner in which the exchange rate with respect to such payments
will be determined;

                            2.2.16 the manner in which the amounts of payment of
principal of or interest, if any, on the Securities of the Series will be
determined, if such amounts may be determined by reference to an index based on
a currency or currencies or by reference to a commodity, commodity index, stock
exchange index or financial index;

                            2.2.17 the provisions, if any, relating to any
security provided for the Securities of the Series;

                            2.2.18 any addition to or change in the Events of
Default which applies to any Securities of the Series and any change in the
right of the Trustee or the requisite Holders of such Securities to declare the
principal amount thereof due and payable pursuant to Section 6.2;

                            2.2.19 any addition to or change in the covenants
set forth in Articles IV or V which applies to Securities of the Series;

                            2.2.20 any other terms of the Securities of the
Series (which terms shall not be inconsistent with the provisions of this
Indenture, except as permitted by Section 9.1, but which may modify or delete
any provision of this Indenture insofar as it applies to such Series); and

                            2.2.21 any depositories, interest rate calculation
agents, exchange rate calculation agents or other agents with respect to
Securities of such Series if other than those appointed herein.

                  All Securities of any one Series need not be issued at the
same time and may be issued from time to time, consistent with the terms of this
Indenture, if so provided by or pursuant to the Board Resolution, supplemental
indenture or Officers' Certificate referred to above, and the authorized
principal amount of any Series may not be increased to provide for issuances of
additional Securities of such Series, unless otherwise provided in such Board
Resolution, supplemental indenture or Officers' Certificate.

         Section 2.3       EXECUTION AND AUTHENTICATION.

                  Two Officers 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 Security is authenticated, the Security shall
nevertheless be valid.

                  A Security shall not be valid until authenticated by the
manual signature of the Trustee or an authenticating agent. The signature shall
be conclusive evidence that the Security has been authenticated under this
Indenture.

                  The Trustee shall at any time, and from time to time,
authenticate Securities for original issue in the principal amount provided in
the Board Resolution, supplemental indenture hereto or Officers' Certificate,
upon receipt

<PAGE>

by the Trustee of a Company Order. Such Company Order may authorize
authentication and delivery pursuant to oral or electronic instructions from the
Company or its duly authorized agent or agents, which oral instructions shall be
promptly confirmed in writing. Each Security shall be dated the date of its
authentication unless otherwise provided by a Board Resolution, a supplemental
indenture hereto or an Officers' Certificate.

                  The aggregate principal amount of Securities of any Series
outstanding at any time may not exceed any limit upon the maximum principal
amount for such Series set forth in the Board Resolution, supplemental indenture
hereto or Officers' Certificate delivered pursuant to Section 2.2, except as
provided in Section 2.8.

                  Prior to the issuance of Securities of any Series, the Trustee
shall have received and (subject to Section 7.2) shall be fully protected in
relying on: (a) the Board Resolution, supplemental indenture hereto or Officers'
Certificate establishing the form of the Securities of that Series or of
Securities within that Series and the terms of the Securities of that Series or
of Securities within that Series, (b) an Officers' Certificate complying with
Section 10.4, and (c) an Opinion of Counsel complying with Section 10.4.

                  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.

         Section 2.4       REGISTRAR AND PAYING AGENT.

                  The Company shall maintain, with respect to each Series of
Securities, at the place or places specified with respect to such Series
pursuant to Section 2.2, an office or agency where Securities of such Series may
be presented or surrendered for payment ("Paying Agent"), where Securities of
such Series may be surrendered for registration of transfer or exchange
("Registrar") and where notices and demands to or upon the Company in respect of
the Securities of such Series and this Indenture may be served ("Service
Agent"). The Registrar shall keep a register with respect to each Series of
Securities and to their transfer and exchange. The Company will give prompt
written notice to the Trustee of the name and address, and any change in the
name or address, of each Registrar, Paying Agent or Service Agent. If at any
time the Company shall fail to maintain any such required Registrar, Paying
Agent or Service Agent or shall fail to furnish the Trustee with the name and
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 also from time to time designate one or more
co-registrars, additional paying agents or additional service agents and may
from time to time rescind such designations; provided, however, that no such
designation or rescission shall in any manner relieve the Company of its
obligations to maintain a Registrar, Paying Agent and Service Agent in each
place so specified pursuant to Section 2.2 for Securities of any Series for such
purposes. The Company will give prompt written notice to the Trustee of any such
designation or rescission and of any change in the name or address of any such
co-registrar, additional paying agent or additional service agent. The term
"Registrar" includes any co-registrar; the term "Paying Agent" includes any
additional paying agent; and the term "Service Agent" includes any additional
service agent.

                  The Company hereby appoints the Trustee the initial Registrar,
Paying Agent and Service Agent for each Series unless another Registrar, Paying
Agent or Service Agent, as the case may be, is appointed prior to the time
Securities of that Series are first issued.

         Section 2.5       PAYING AGENT TO HOLD MONEY IN TRUST

                  The Company shall require each Paying Agent other than the
Trustee to agree in writing that the Paying Agent will hold in trust, for the
benefit of Securityholders of any Series of Securities, or the Trustee, all
money

<PAGE>

held by the Paying Agent for the payment of principal of or interest on the
Series of Securities, and will notify the Trustee of any default by the Company
in making any such payment. While any such default continues, the Trustee may
require a Paying Agent to pay all money held by it to the Trustee. The Company
at any time may require a Paying Agent to pay all money held by it to the
Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the
Company or a Subsidiary) shall have no further liability for the money. If the
Company or a Subsidiary acts as Paying Agent, it shall segregate and hold in a
separate trust fund for the benefit of Securityholders of any Series of
Securities all money held by it as Paying Agent.

         Section 2.6       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 of each Series of Securities and shall otherwise
comply with TIA Section 312(a). If the Trustee is not the Registrar, the Company
shall furnish to the Trustee at least ten days before each 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 of each Series of Securities.

         Section 2.7       TRANSFER AND EXCHANGE.

                  Where Securities of a Series are presented to the Registrar or
a co-registrar with a request to register a transfer or to exchange them for an
equal principal amount of Securities of the same Series, the Registrar shall
register the transfer or make the exchange if its requirements for such
transactions are met. To permit registrations of transfers and exchanges, the
Trustee shall authenticate Securities at the Registrar's request. No service
charge shall be made for any registration of transfer or exchange (except as
otherwise expressly permitted herein), but the Company may require payment of a
sum sufficient to cover any transfer tax or similar governmental charge payable
in connection therewith (other than any such transfer tax or similar
governmental charge payable upon exchanges pursuant to Sections 2.11, 3.6 or
9.6).

                  Neither the Company nor the Registrar shall be required (a) to
issue, register the transfer of, or exchange Securities of any Series for the
period beginning at the opening of business fifteen days immediately preceding
the mailing of a notice of redemption of Securities of that Series selected for
redemption and ending at the close of business on the day of such mailing, or
(b) to register the transfer of or exchange Securities of any Series selected,
called or being called for redemption as a whole or the portion being redeemed
of any such Securities selected, called or being called for redemption in part.

         Section 2.8       MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES.

                  If any mutilated Security is surrendered to the Trustee, the
Company shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same Series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.

                  If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity as may be required by them to save each of
them and any agent of either 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 request the Trustee shall
authenticate and make available for delivery, in lieu of any such destroyed,
lost or stolen Security, a new Security of the same Series and of like tenor and
principal amount and 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, the Company in its discretion
may, instead of issuing a new Security, pay such Security.

<PAGE>

                  Upon the issuance of any new Security under this Section, 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) connected therewith.

                  Every new Security of any Series issued pursuant to this
Section 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 the benefits of this Indenture equally and
proportionately with any and all other Securities of that Series duly issued
hereunder.

                  The provisions of this Section 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 2.9       OUTSTANDING SECURITIES.

                  The Securities outstanding at any time are all the Securities
authenticated by the Trustee except for those canceled by it, those delivered to
it for cancellation, those reductions in the interest on a Global Security
effected by the Trustee in accordance with the provisions hereof and those
described in this Section as not outstanding.

                  If a Security is replaced pursuant to Section 2.8, it ceases
to be outstanding until 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, a Subsidiary or
an Affiliate of any thereof) holds on the Maturity of Securities of a Series
money sufficient to pay such Securities payable on that date, then on and after
that date such Securities of the Series cease to be outstanding and interest on
them ceases to accrue.

                  A Security shall cease to be outstanding if the Company or any
of its Subsidiaries holds the Security.

                  In determining whether the Holders of the requisite principal
amount of outstanding Securities have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, the principal amount of a
Discount Security that shall be deemed to be outstanding for such purposes shall
be the amount of the principal thereof that would be due and payable as of the
date of such determination upon a declaration of acceleration of the Maturity
thereof pursuant to Section 6.2.

         Section 2.10      TREASURY SECURITIES.

                  In determining whether the Holders of the required principal
amount of Securities of a Series have concurred in any request, demand,
authorization, direction, notice, consent or waiver Securities of a Series owned
by the Company or an Affiliate shall be disregarded, except that for the
purposes of determining whether the Trustee shall be protected in relying on any
such request, demand, authorization, direction, notice, consent or waiver only
Securities of a Series that the Trustee knows are so owned shall be so
disregarded.

         Section 2.11      TEMPORARY SECURITIES.

                  Until definitive Securities are ready for delivery, the
Company may prepare and the Trustee shall authenticate temporary Securities upon
a Company Order. Temporary Securities shall be substantially in the form of
definitive Securities but may have variations that the Company considers
appropriate for temporary Securities. Without unreasonable delay, the Company
shall prepare and the Trustee upon request shall authenticate definitive
Securities of the same Series and date of maturity in exchange for temporary
Securities. Until so exchanged, temporary securities shall have the same rights
under this Indenture as the definitive Securities.

         Section 2.12      CANCELLATION.

<PAGE>

                  The Company at any time may deliver Securities to the Trustee
for cancellation. The Registrar and the Paying Agent shall forward to the
Trustee any Securities surrendered to them for registration of transfer,
exchange or payment. The Trustee shall cancel all Securities surrendered for
transfer, exchange, payment, replacement or cancellation and shall destroy such
canceled Securities (subject to the record retention requirement of the Exchange
Act) and deliver a certificate of such destruction to the Company, unless the
Company otherwise directs. The Company may not issue new Securities to replace
Securities that it has paid or delivered to the Trustee for cancellation.

         Section 2.13      DEFAULTED INTEREST.

                  If the Company defaults in a payment of interest on a Series
of Securities, it shall pay the defaulted interest, plus, to the extent
permitted by law, any interest payable on the defaulted interest, to the persons
who are Securityholders of the Series on a subsequent special record date. The
Company shall fix the record date and payment date. At least 30 days before the
record date, the Company shall mail to the Trustee and to each Securityholder of
the Series a notice that states the record date, the payment date and the amount
of interest to be paid. The Company may pay defaulted interest in any other
lawful manner.

         Section 2.14      GLOBAL SECURITIES.

                  2.14.1 TERMS OF SECURITIES. A Board Resolution, a supplemental
indenture hereto or an Officers' Certificate shall establish whether the
Securities of a Series shall be issued in whole or in part in the form of one or
more Global Securities and the Depository for such Global Security or
Securities.

                  2.14.2 TRANSFER AND EXCHANGE. Notwithstanding any provisions
to the contrary contained in Section 2.7 of the Indenture and in addition
thereto, any Global Security shall be exchangeable pursuant to Section 2.7 of
the Indenture for Securities registered in the names of Holders other than the
Depository for such Security or its nominee only if (i) such Depository notifies
the Company that it is unwilling or unable to continue as Depository for such
Global Security or if at any time such Depository ceases to be a clearing agency
registered under the Exchange Act, and, in either case, the Company fails to
appoint a successor Depository within 90 days of such event, (ii) the Company
executes and delivers to the Trustee an Officers' Certificate to the effect that
such Global Security shall be so exchangeable or (iii) an Event of Default with
respect to the Securities represented by such Global Security shall have
happened and be continuing. Any Global Security that is exchangeable pursuant to
the preceding sentence shall be exchangeable for Securities registered in such
names as the Depository shall direct in writing in an aggregate principal amount
equal to the principal amount of the Global Security with like tenor and terms.

                  Except as provided in this Section 2.14.2, a Global Security
may not be transferred except as a whole by the Depository with respect to such
Global Security to a nominee of such Depository, by a nominee of such Depository
to such Depository or another nominee of such Depository or by the Depository or
any such nominee to a successor Depository or a nominee of such a successor
Depository.

                  2.14.3 LEGEND. Any Global Security issued hereunder shall bear
a legend in substantially the following form:

                  "This Security is a Global Security within the meaning of the
Indenture hereinafter referred to and is registered in the name of the
Depository or a nominee of the Depository. This Security is exchangeable for
Securities registered in the name of a person other than the Depository or its
nominee only in the limited circumstances described in the Indenture, and may
not be transferred except as a whole by the Depository to a nominee of the
Depository, by a nominee of the Depository to the Depository or another nominee
of the Depository or by the Depository or any such nominee to a successor
Depository or a nominee of such a successor Depository."

<PAGE>

                  2.14.4 ACTS OF HOLDERS. The Depository, as a Holder, may
appoint agents and otherwise authorize participants to give or take any request,
demand, authorization, direction, notice, consent, waiver or other action which
a Holder is entitled to give or take under the Indenture.

                  2.14.5 PAYMENTS. Notwithstanding the other provisions of this
Indenture, unless otherwise specified as contemplated by Section 2.2, payment of
the principal of and interest, if any, on any Global Security shall be made to
the Holder thereof.

                  2.14.6 CONSENTS, DECLARATION AND DIRECTIONS. Except as
provided in Section 2.14.5, the Company, the Trustee and any Agent shall treat a
person as the Holder of such principal amount of outstanding Securities of such
Series represented by a Global Security as shall be specified in a written
statement of the Depositary with respect to such Global Security, for purposes
of obtaining any consents, declarations, waivers or directions required to be
given by the Holders pursuant to this Indenture.

         Section 2.15      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 elements of
identification printed on the Securities, and any such redemption shall not be
affected by any defect in or omission of such numbers.

                                  ARTICLE III.

                                   REDEMPTION

         Section 3.1       NOTICE TO TRUSTEE.

                  The Company may, with respect to any Series of Securities,
reserve the right to redeem and pay the Series of Securities or may covenant to
redeem and pay the Series of Securities or any part thereof prior to the Stated
Maturity thereof at such time and on such terms as provided for in such
Securities. If a Series of Securities is redeemable and the Company wants or is
obligated to redeem prior to the Stated Maturity thereof all or part of the
Series of Securities pursuant to the terms of such Securities, it shall notify
the Trustee of the redemption date and the principal amount of Series of
Securities to be redeemed. The Company shall give the notice at least 45 days
before the redemption date (or such shorter notice as may be acceptable to the
Trustee).

         Section 3.2       SELECTION OF SECURITIES TO BE REDEEMED.

                  Unless otherwise indicated for a particular Series by a Board
Resolution, a supplemental indenture or an Officers' Certificate, if less than
all the Securities of a Series are to be redeemed, the Trustee shall select the
Securities of the Series to be redeemed in any manner that the Trustee deems
fair and appropriate. The Trustee shall make the selection from Securities of
the Series outstanding not previously called for redemption. The Trustee may
select for redemption portions of the principal of Securities of the Series that
have denominations larger than $1,000. Securities of the Series and portions of
them it selects shall be in amounts of $1,000 or whole multiples of $1,000 or,
with respect to Securities of any Series issuable in other denominations
pursuant to Section 2.2.10, the minimum principal denomination for each Series
and integral multiples thereof. Provisions of this Indenture that apply to
Securities of a Series called for redemption also apply to portions of
Securities of that Series called for redemption.

         Section 3.3       NOTICE OF REDEMPTION.

<PAGE>

                  Unless otherwise indicated for a particular Series by Board
Resolution, a supplemental indenture hereto or an Officers' Certificate, at
least 30 days but not more than 60 days before a redemption date, the Company
shall mail a notice of redemption by first-class mail to each Holder whose
Securities are to be redeemed and if any Bearer Securities are outstanding,
publish on one occasion a notice in an Authorized Newspaper.

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

                  (a)      the redemption date;

                  (b)      the redemption price;

                  (c)      the name and address of the Paying Agent;

                  (d)      that Securities of the Series called for redemption
must be surrendered to the Paying Agent to collect the redemption price;

                  (e)      that interest on Securities of the Series called for
redemption ceases to accrue on and after the redemption date; and

                  (f)      any other information as may be required by the terms
of the particular Series or the Securities of a Series being redeemed.

                  At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense.

         Section III.4     EFFECT OF NOTICE OF REDEMPTION.

                  Once notice of redemption is mailed or published as provided
in Section 3.3, Securities of a Series called for redemption become due and
payable on the redemption date and at the redemption price. A notice of
redemption may not be conditional. Upon surrender to the Paying Agent, such
Securities shall be paid at the redemption price plus accrued interest to the
redemption date.

         Section 3.5       DEPOSIT OF REDEMPTION PRICE.

                  On or before the redemption date, the Company shall deposit
with the Paying Agent money sufficient to pay the redemption price of and
accrued interest, if any, on all Securities to be redeemed on that date.

         Section 3.6       SECURITIES REDEEMED IN PART.

                  Upon surrender of a Security that is redeemed in part, the
Trustee shall authenticate for the Holder a new Security of the same Series and
the same maturity equal in principal amount to the unredeemed portion of the
Security surrendered.

                                   ARTICLE IV.

                                    COVENANTS

         Section 4.1       PAYMENT OF PRINCIPAL AND INTEREST.

<PAGE>

                  The Company covenants and agrees for the benefit of the
Holders of each Series of Securities that it will duly and punctually pay the
principal of and interest, if any, on the Securities of that Series in
accordance with the terms of such Securities and this Indenture.

         Section 4.2       SEC REPORTS.

                  The Company shall deliver to the Trustee within 15 days after
it files them with the SEC copies of the annual reports and of the information,
documents, and other reports (or copies of such portions of any of the foregoing
as the SEC may by rules and regulations prescribe) which the Company is required
to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. The
Company also shall comply with the other provisions of TIA Section 314(a).

         Section 4.3       COMPLIANCE CERTIFICATE.

                  The Company shall deliver to the Trustee, within 90 days after
the end of each fiscal year of the Company, an Officers' Certificate stating
that a review of the activities of the Company and its Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the best of
his knowledge the Company has kept, observed, performed and fulfilled each and
every covenant contained in this Indenture and is not in default in the
performance or observance of any of the terms, provisions and conditions hereof
(or, if a Default or Event of Default shall have occurred, describing all such
Defaults or Events of Default of which he may have knowledge).

                  The Company will, so long as any of the Securities are
outstanding, deliver to the Trustee, forthwith upon becoming aware of any
Default or Event of Default, an Officers' Certificate specifying such Default or
Event of Default and what action the Company is taking or proposes to take with
respect thereto.

         Section 4.4       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 or the Securities; 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 has been enacted.

         Section 4.5       CORPORATE EXISTENCE.

                  Subject to Article V, 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 the corporate, partnership or other existence of each Significant
Subsidiary in accordance with the respective organizational documents of each
Significant Subsidiary and the rights (charter and statutory), licenses and
franchises of the Company and its Significant Subsidiaries, except, in each
case, where the failure to do or to care to be done of any of the foregoing
would not have a material adverse effect on the Company and its Subsidiaries,
taken as a whole; provided, however, that the Company shall not be required to
preserve any such right, license or franchise, or the corporate, partnership or
other existence of any Significant Subsidiary, if the Board of Directors shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company.

         Section 4.6       TAXES.

                  The Company shall, and shall cause each of its Significant
Subsidiaries to, pay prior to delinquency all taxes, assessments and
governmental levies, except as contested in good faith and by appropriate
proceedings, and except where the failure to so pay would not have a material
adverse effect on the Company and its Subsidiaries, taken as a whole.

<PAGE>

                                   ARTICLE V.

                                   SUCCESSORS

         Section 5.1       WHEN COMPANY MAY MERGE, ETC.

                  The Company shall not consolidate with or merge into, or
convey, transfer or lease all or substantially all of its properties and assets
to, any person (a "successor person"), and may not permit any person to merge
into, or convey, transfer or lease its properties and assets substantially as an
entirety to, the Company, unless:

                  (a) the successor person (if any) is a corporation,
partnership, trust or other entity organized and validly existing under the laws
of any U.S. domestic jurisdiction and expressly assumes the Company's
obligations on the Securities and under this Indenture and

                  (b) immediately after giving effect to the transaction, no
Default or Event of Default shall have occurred and be continuing.

                  The Company shall deliver to the Trustee prior to the
consummation of the proposed transaction an Officers' Certificate to the
foregoing effect and an Opinion of Counsel stating that the proposed transaction
and such supplemental indenture comply with this Indenture.

         Section 5.2       SUCCESSOR CORPORATION SUBSTITUTED.

                  Upon any consolidation or merger, or any sale, lease,
conveyance or other disposition of all or substantially all of the assets of the
Company in accordance with Section 5.1, the successor corporation formed by such
consolidation or into or with which the Company is merged or to which such sale,
lease, conveyance or other disposition 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 has been named
as the Company herein; provided, however, that the predecessor Company in the
case of a sale, lease, conveyance or other disposition shall not be released
from the obligation to pay the principal of and interest, if any, on the
Securities.

                                   ARTICLE VI.

                              DEFAULTS AND REMEDIES

         Section 6.1       EVENTS OF DEFAULT.

                  "Event of Default," wherever used herein with respect to
Securities of any Series, means any one of the following events, unless in the
establishing Board Resolution, supplemental indenture or Officers' Certificate,
it is provided that such Series shall not have the benefit of said Event of
Default:

                  (a) default in the payment of any interest on any Security of
that Series when it becomes due and payable, and continuance of such default for
a period of 30 days (unless the entire amount of such payment is deposited by
the Company with the Trustee or with a Paying Agent prior to the expiration of
such period of 30 days); or

                  (b) default in the payment of the principal of any Security of
that Series at its Maturity; or

<PAGE>

                  (c) default in the deposit of a sinking fund payment, if any,
when and as due in respect of any Security of that Series; or

                  (d) default in the performance or breach of any covenant or
warranty of the Company in this Indenture (other than a covenant or warranty
that has been included in this Indenture solely for the benefit of Series of
Securities other than that Series), which default continues uncured for a period
of 60 days after there has been given, by registered or certified mail, 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 of that Series a
written notice specifying such default or breach and requiring it to be remedied
and stating that such notice is a "Notice of Default" hereunder; or

                  (e) the Company or any of its Significant Subsidiaries
pursuant to or within the meaning of any Bankruptcy Law:

                           (i)      commences a voluntary case,

                           (ii)     consents to the entry of an order for relief
                           against it in an involuntary case,

                           (iii)    consents to the appointment of a Custodian
                           of it or for all or substantially all of its
                           property,

                           (iv)     makes a general assignment for the benefit
                           of its creditors, or

                           (v)      generally is unable to pay its debts as the
                           same become due; or

                  (f) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:

                           (i)      is for relief against the Company or any of
                           its Significant Subsidiaries in an involuntary case,

                           (ii)     appoints a Custodian of the Company or any
                           of its Significant Subsidiaries or for all or
                           substantially all of its property, or

                           (iii)    orders the liquidation of the Company or any
                           of its Significant Subsidiaries, and the order or
                           decree remains unstayed and in effect for 60 days; or

                  (g) any other Event of Default provided with respect to
Securities of that Series, which is specified in a Board Resolution, a
supplemental indenture hereto or an Officers' Certificate, in accordance with
Section 2.2.18.

                  The term "Bankruptcy Law" means Title 11, U.S. Code or any
similar Federal or State law for the relief of debtors. The term "Custodian"
means any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.

         Section 6.2       ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT.

                  If an Event of Default with respect to Securities of any
Series at the time outstanding occurs and is continuing (other than an Event of
Default referred to in Section 6.1(e) or (f)) then in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
outstanding Securities of that Series may declare the principal amount (or, if
any Securities of that Series are Discount Securities, such portion of the
principal amount as may be specified in the terms of such Securities) of and
accrued and unpaid interest, if any, on all of the Securities of that Series to
be due and payable immediately, by a notice in writing to the Company (and to
the Trustee if given by Holders), and

<PAGE>

upon any such declaration such principal amount (or specified amount) and
accrued and unpaid interest, if any, shall become immediately due and payable.
If an Event of Default specified in Section 6.1(e) or (f) shall occur, the
principal amount (or specified amount) of and accrued and unpaid interest, if
any, on all outstanding Securities shall ipso facto become and be immediately
due and payable without any declaration or other act on the part of the Trustee
or any Holder.

                  At any time after such a declaration of acceleration with
respect to any Series has been made and before a judgment or decree for payment
of the money due has been obtained by the Trustee as hereinafter in this Article
provided, the Holders of a majority in principal amount of the outstanding
Securities of that Series, by written notice to the Company and the Trustee, may
rescind and annul such declaration and its consequences if:

                  (a) the Company has paid or deposited with the Trustee a sum
sufficient to pay:

                           (i)      all overdue interest, if any, on all
                           Securities of that Series,

                           (ii)     the principal of any Securities of that
                           Series which have become due otherwise than by such
                           declaration of acceleration and interest thereon at
                           the rate or rates prescribed therefor in such
                           Securities,

                           (iii)    to the extent that payment of such interest
                           is lawful, interest upon any overdue principal and
                           overdue interest at the rate or rates prescribed
                           therefor in such Securities, and

                           (iv)     all sums paid or advanced by the Trustee
                           hereunder and the reasonable compensation, expenses,
                           disbursements and advances of the Trustee, its agents
                           and counsel; and

                  (b) all Events of Default with respect to Securities of that
Series, other than the non-payment of the principal of Securities of that Series
which have become due solely by such declaration of acceleration, have been
cured or waived as provided in Section 6.13.

                  No such rescission shall affect any subsequent Default or
impair any right consequent thereon.

         Section 6.3       COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT
                           BY TRUSTEE.

                  The Company covenants that if:

                  (a) default is made in the payment of any interest on any
Security when such interest becomes due and payable and such default continues
for a period of 30 days, or

                  (b) default is made in the payment of principal of any
Security at the Maturity thereof, or

                  (c) default is made in the deposit of any sinking fund payment
when and as due by the terms of a Security,

                  then the Company will, upon demand of the Trustee, pay to it,
for the benefit of the Holders of such Securities, the whole amount then due and
payable on such Securities for principal and interest and, to the extent that
payment of such interest shall be legally enforceable, interest on any overdue
principal or any overdue interest, at the rate or rates prescribed therefor in
such Securities, and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.

<PAGE>

                  If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, may prosecute such proceeding to judgment or final decree and may
enforce the same against the Company or any other obligor upon such Securities
and collect the moneys adjudged or deemed to be payable in the manner provided
by law out of the property of the Company or any other obligor upon such
Securities, wherever situated.

                  If an Event of Default with respect to any Securities of any
Series occurs and is continuing, the Trustee may in its discretion proceed to
protect and enforce its rights and the rights of the Holders of Securities of
such Series by such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.

         Section 6.4       TRUSTEE MAY FILE PROOFS OF CLAIM.

                  In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise,

                  (a) to file and prove a claim for the whole amount of
principal and interest owing and unpaid in respect of the Securities and to file
such 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
of the Holders allowed in such judicial proceeding, and

                  (b) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same, and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Holder 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 Holders, to pay to
the Trustee any amount due 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 7.7.

                  Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
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 Holder in any such proceeding.

         Section 6.5       TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
                           SECURITIES.

                  All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.

         Section 6.6       APPLICATION OF MONEY COLLECTED.

                  Any money collected by the Trustee pursuant to this Article
shall be applied in the following order, at the date or dates fixed by the
Trustee and, in case of the distribution of such money on account of principal
or interest,

<PAGE>

upon presentation of the Securities and the notation thereon of the payment if
only partially paid and upon surrender thereof if fully paid:

                  First: To the payment of all amounts due the Trustee under
Section 7.7; and

                  Second: To the payment of the amounts then due and unpaid for
principal of and interest on the Securities in respect of which or for the
benefit of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such
Securities for principal and interest, respectively; and

                  Third: To the Company.

         Section 6.7       LIMITATION ON SUITS.

                  No Holder of any Security of any Series shall have any right
to institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:

                  (a) such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to the Securities of that
Series;

                  (b) the Holders of not less than 25% in principal amount of
the outstanding Securities of that Series shall have made written request to the
Trustee to institute proceedings in respect of such Event of Default in its own
name as Trustee hereunder;

                  (c) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be incurred
in compliance with such request;

                  (d) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such proceeding; and

                  (e) 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 outstanding Securities of that Series.

                  It is understood and intended that no one or more of such
Holders shall have any right in any manner whatever by virtue of, or by availing
of, any provision of this Indenture to affect, disturb or prejudice the rights
of any other of such Holders, or to obtain or to seek to obtain priority or
preference over any other of such Holders or to enforce any right under this
Indenture, except in the manner herein provided and for the equal and ratable
benefit of all such Holders.

         Section 6.8       UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL
                           AND INTEREST.

                  Notwithstanding any other provision in this Indenture, the
Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment of the principal of and interest, if any, on
such Security on the Stated Maturity or Stated Maturities expressed in such
Security (or, in the case of redemption, on the redemption date) and to
institute suit for the enforcement of any such payment, and such rights shall
not be impaired without the consent of such Holder.

         Section 6.9       RESTORATION OF RIGHTS AND REMEDIES.

<PAGE>

                  If the Trustee or any Holder 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 Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.

         Section 6.10      RIGHTS AND REMEDIES CUMULATIVE.

                  Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities in Section 2.8, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders 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 6.11      DELAY OR OMISSION NOT WAIVER.

                  No delay or omission of the Trustee or of any Holder of any
Securities 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 Holders may be exercised from time to
time, and as often as may be deemed expedient, by the Trustee or by the Holders,
as the case may be.

         Section 6.12      CONTROL BY HOLDERS.

                  The Holders of a majority in principal amount of the
outstanding Securities of any Series shall have the right to 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 the Trustee, with respect
to the Securities of such Series, provided that:

                  (a) such direction shall not be in conflict with any rule of
law or with this Indenture,

                  (b) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction, and

                  (c) subject to the provisions of Section 6.1, the Trustee
shall have the right to decline to follow any such direction if the Trustee in
good faith shall, by a Responsible Officer of the Trustee, determine that the
proceeding so directed would involve the Trustee in personal liability.

         Section 6.13      WAIVER OF PAST DEFAULTS.

                  The Holders of not less than a majority in principal amount of
the outstanding Securities of any Series may on behalf of the Holders of all the
Securities of such Series waive any past Default hereunder with respect to such
Series and its consequences, except a Default in the payment of the principal of
or interest on any Security of such Series (provided, however, that the Holders
of a majority in principal amount of the outstanding Securities of any Series
may rescind an acceleration and its consequences, including any related payment
default that resulted from such acceleration). Upon any such waiver, such
Default shall cease to exist, and any Event of Default arising therefrom shall
be deemed to have been cured, for every purpose of this Indenture; but no such
waiver shall extend to any subsequent or other Default or impair any right
consequent thereon.

         Section 6.14      UNDERTAKING FOR COSTS.

<PAGE>

                  All parties to this Indenture agree, and each Holder of any
Security by his acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, 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, suffered or omitted by it as Trustee, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section shall not apply to any suit instituted by the
Company, to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% in principal
amount of the outstanding Securities of any Series, or to any suit instituted by
any Holder for the enforcement of the payment of the principal of or interest on
any Security on or after the Stated Maturity or Stated Maturities expressed in
such Security (or, in the case of redemption, on the redemption date).

                                  ARTICLE VII.

                                     TRUSTEE

         Section 7.1       DUTIES OF TRUSTEE.

                  (a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise 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 man would
exercise or use under the circumstances in the conduct of his own affairs.

                  (b) Except during the continuance of an Event of Default:

                           (v) The Trustee need perform only those duties that
                           are specifically set forth in this Indenture and no
                           others.

                           (vi) 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 Officers' Certificates or
                           Opinions of Counsel furnished to the Trustee and
                           conforming to the requirements of this Indenture;
                           however, in the case of any such Officers'
                           Certificates or Opinions of Counsel which by any
                           provisions hereof are specifically required to be
                           furnished to the Trustee, the Trustee shall examine
                           such Officers' Certificates and Opinions of Counsel
                           to determine whether or not they conform to the
                           requirements of this Indenture.

                  (c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:

                           (vii) This paragraph does not limit the effect of
                           paragraph (b) of this Section.

                           (viii) The Trustee shall not be liable for any error
                           of judgment made in good faith by a Responsible
                           Officer, unless it is proved that the Trustee was
                           negligent in ascertaining the pertinent facts.

                           (ix) The Trustee shall not be liable with respect to
                           any action taken, suffered or omitted to be taken by
                           it with respect to Securities of any Series in good
                           faith in accordance with the direction of the Holders
                           of a majority in principal amount of the outstanding
                           Securities of such Series relating to the time,
                           method and place of conducting any proceeding for any

<PAGE>

                           remedy available to the Trustee, or exercising any
                           trust or power conferred upon the Trustee, under this
                           Indenture with respect to the Securities of such
                           Series.

                  (d) Every provision of this Indenture that in any way relates
to the Trustee is subject to paragraph (a), (b) and (c) of this Section.

                  (e) The Trustee may refuse to perform any duty or exercise any
right or power unless it receives indemnity satisfactory to it against any loss,
liability or expense.

                  (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.

                  (g) No provision of this Indenture shall require the Trustee
to risk its own funds or otherwise incur any financial liability in the
performance of any of its duties, 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 is not reasonably assured to it.

                  (h) The Paying Agent, the Registrar and any authenticating
agent shall be entitled to the protections, immunities and standard of care as
are set forth in paragraphs (a), (b) and (c) of this Section with respect to the
Trustee.

         Section 7.2       RIGHTS OF TRUSTEE.

                  (a) The Trustee may rely on and shall be protected in acting
or refraining from acting upon 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) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel.

                  (c) The Trustee may act through agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care. No Depository shall be deemed an agent of the Trustee and the Trustee
shall not be responsible for any act or omission by any Depository.

                  (d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers.

                  (e) The Trustee may consult with counsel and the advice of
such counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon.

                  (f) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders of Securities unless such Holders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request or direction.

         Section 7.3       INDIVIDUAL RIGHTS OF TRUSTEE.

<PAGE>

                  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 with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights. The Trustee is also subject to Sections 7.10
and 7.11.

         Section 7.4       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 any statement in the Securities other than its authentication.

         Section 7.5       NOTICE OF DEFAULTS.

                  If a Default or Event of Default occurs and is continuing with
respect to the Securities of any Series and if it is known to a Responsible
Officer of the Trustee, the Trustee shall mail to each Securityholder of the
Securities of that Series and, if any Bearer Securities are outstanding, publish
on one occasion in an Authorized Newspaper, notice of a Default or Event of
Default within 90 days after it occurs or, if later, after a Responsible Officer
of the Trustee has knowledge of such Default or Event of Default. Except in the
case of a Default or Event of Default in payment of principal of or interest on
any Security of any Series, the Trustee may withhold the notice if and so long
as its corporate trust committee or a committee of its Responsible Officers in
good faith determines that withholding the notice is in the interests of
Securityholders of that Series.

         Section 7.6       REPORTS BY TRUSTEE TO HOLDERS.

                  Within 60 days after May 15 in each year, the Trustee shall
transmit by mail to all Securityholders, as their names and addresses appear on
the register kept by the Registrar and, if any Bearer Securities are
outstanding, publish in an Authorized Newspaper, a brief report dated as of such
May 15, in accordance with, and to the extent required under, TIA Section 313.

                  A copy of each report at the time of its mailing to
Securityholders of any Series shall be filed with the SEC and each stock
exchange on which the Securities of that Series are listed. The Company shall
promptly notify the Trustee when Securities of any Series are listed on any
stock exchange.

         Section 7.7       COMPENSATION AND INDEMNITY.

                  The Company shall pay to the Trustee from time to time
reasonable compensation for its services. The Trustee's compensation shall not
be limited by any law on compensation of a trustee of an express trust. The
Company shall reimburse the Trustee upon request for all reasonable
out-of-pocket expenses incurred by it. Such expenses shall include the
reasonable compensation and expenses of the Trustee's agents and counsel.

                  The Company shall indemnify the Trustee (including the cost of
defending itself) against any loss, liability or expense incurred by it except
as set forth in the next paragraph in the performance of its duties under this
Indenture as Trustee or Agent. The Trustee shall notify the Company promptly of
any claim for which it may seek indemnity. The Company shall defend the claim
and the Trustee shall cooperate in the defense. The Trustee may have separate
counsel and the Company shall pay the reasonable fees and expenses of such
counsel. The Company need not pay for any settlement made without its consent,
which consent shall not be unreasonably withheld. This indemnification shall
apply to officers, directors, employees, shareholders and agents of the Trustee.

                  The Company need not reimburse any expense or indemnify
against any loss or liability incurred by the Trustee or by any officer,
director, employee, shareholder or agent of the Trustee through negligence or
bad faith.

<PAGE>

                  To secure the Company's payment obligations in this Section,
the Trustee shall have a lien prior to the Securities of any Series on all money
or property held or collected by the Trustee, except that held in trust to pay
principal and interest on particular Securities of that Series.

                  When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.1(e) or (f) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.

         Section 7.8       REPLACEMENT OF TRUSTEE.

                  A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.

                  The Trustee may resign with respect to the Securities of one
or more Series by so notifying the Company. The Holders of a majority in
principal amount of the Securities of any Series may remove the Trustee with
respect to that Series by so notifying the Trustee and the Company. The Company
may remove the Trustee with respect to Securities of one or more Series if:

                  (a) the Trustee fails to comply with Section 7.10;

                  (b) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any Bankruptcy
Law;

                  (c) a Custodian or public officer takes charge of the Trustee
or its property; or

                  (d) the Trustee becomes incapable of acting.

                  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. Within one year after the successor Trustee takes office, the
Holders of a majority in principal amount of the then outstanding Securities may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.

                  If a successor Trustee with respect to the Securities of any
one or more Series does not take office within 60 days after the retiring
Trustee resigns or is removed, the retiring Trustee, the Company or the Holders
of at least 10% in principal amount of the Securities of the applicable Series
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.

                  If the Trustee with respect to the Securities of any one or
more Series fails to comply with Section 7.10, any Securityholder of the
applicable Series 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 subject to the lien provided for in Section 7.7, 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
with respect to each Series of Securities for which it is acting as Trustee
under this Indenture. A successor Trustee shall mail a notice of its succession
to each Securityholder of each such Series and, if any Bearer Securities are
outstanding, publish such notice on one occasion in an Authorized Newspaper.
Notwithstanding replacement of the Trustee pursuant to this Section 7.8, the
Company's obligations under Section 7.7 hereof shall continue for the benefit of
the retiring Trustee with respect to expenses and liabilities incurred by it
prior to such replacement.

<PAGE>

         Section 7.9       SUCCESSOR TRUSTEE BY MERGER, ETC.

                  If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.

         Section 7.10      ELIGIBILITY; DISQUALIFICATION.

                  This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1), (2) and (5). The Trustee shall always
have a combined capital and surplus of at least $25,000,000 as set forth in its
most recent published annual report of condition. The Trustee shall comply with
TIA Section 310(b).

         Section 7.11      PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.

                  The Trustee is subject to TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated.

                                  ARTICLE VIII.

                     SATISFACTION AND DISCHARGE; DEFEASANCE

         Section 8.1       SATISFACTION AND DISCHARGE OF INDENTURE.

                  This Indenture shall upon Company Order cease to be of further
effect (except as hereinafter provided in this Section 8.1), and the Trustee, at
the expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when:

                  (a)      neither:

                           (i) all Securities theretofore authenticated and
                           delivered (other than Securities that have been
                           destroyed, lost or stolen and that have been replaced
                           or paid) have been delivered to the Trustee for
                           cancellation; or

                           (ii) all such Securities not theretofore delivered to
                           the Trustee for cancellation:

                                    (1) have become due and payable, or

                                    (2) will become due and payable at their
                                    Stated Maturity within one year, or

                                    (3) are to be called for redemption within
                                    one year under arrangements satisfactory to
                                    the Trustee for the giving of notice of
                                    redemption by the Trustee in the name, and
                                    at the expense, of the Company, or

                                    (4) are deemed paid and discharged pursuant
                                    to Section 8.3, as applicable;

                  and the Company, in the case of (1), (2) or (3) above, has
deposited or caused to be deposited with the Trustee as trust funds in trust an
amount sufficient for the purpose of paying and discharging the entire
indebtedness on such Securities not theretofore delivered to the Trustee for
cancellation, for principal and interest to the date of such deposit (in the
case of Securities which have become due and payable on or prior to the date of
such deposit) or to the Stated Maturity or redemption date, as the case may be;

<PAGE>

                  (b) the Company has paid or caused to be paid all other sums
payable hereunder by the Company; and

                  (c) the Company has delivered to the Trustee an Officers'
Certificate stating that all conditions precedent herein provided for relating
to the satisfaction and discharge of this Indenture have been complied with.

                  Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company to the Trustee under Section 7.7, and,
if money shall have been deposited with the Trustee pursuant to clause (a) of
this Section, the provisions of Sections 2.4, 2.7, 2.8, 8.1 8.2 and 8.5 shall
survive.

         Section 8.2       APPLICATION OF TRUST FUNDS; INDEMNIFICATION.

                  (a) Subject to the provisions of Section 8.5, all money
deposited with the Trustee pursuant to Section 8.1, all money and U.S.
Government Obligations or Foreign Government Obligations deposited with the
Trustee pursuant to Section 8.3 or 8.4 and all money received by the Trustee in
respect of U.S. Government Obligations or Foreign Government Obligations
deposited with the Trustee pursuant to Section 8.3 or 8.4, shall be held in
trust and applied by it, in accordance with the provisions of the Securities and
this Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the persons entitled thereto, of the principal and interest for
whose payment such money has been deposited with or received by the Trustee or
to make mandatory sinking fund payments or analogous payments as contemplated by
Sections 8.3 or 8.4.

                  (b) The Company shall pay and shall indemnify the Trustee
against any tax, fee or other charge imposed on or assessed against U.S.
Government Obligations or Foreign Government Obligations deposited pursuant to
Sections 8.3 or 8.4 or the interest and principal received in respect of such
obligations other than any payable by or on behalf of Holders.

                  (c) The Trustee shall deliver or pay to the Company from time
to time upon Company Request any U.S. Government Obligations or Foreign
Government Obligations or money held by it as provided in Sections 8.3 or 8.4
which, in the opinion of a nationally recognized firm of independent certified
public accountants expressed in a written certification thereof delivered to the
Trustee, are then in excess of the amount thereof which then would have been
required to be deposited for the purpose for which such U.S. Government
Obligations or Foreign Government Obligations or money were deposited or
received. This provision shall not authorize the sale by the Trustee of any U.S.
Government Obligations or Foreign Government Obligations held under this
Indenture.

         Section 8.3       LEGAL DEFEASANCE OF SECURITIES OF ANY SERIES.

                  Unless this Section 8.3 is otherwise specified pursuant to
Section 2.2.20 to be inapplicable to Securities of any Series, the Company shall
be deemed to have paid and discharged the entire indebtedness on all the
outstanding Securities of such Series on the 91st day after the date of the
deposit referred to in subparagraph (d) hereof, and the provisions of this
Indenture, as it relates to such outstanding Securities of such Series, shall no
longer be in effect (and the Trustee, at the expense of the Company, shall, at
Company Request, execute proper instruments acknowledging the same), except as
to:

                  (a) the rights of Holders of Securities of such Series to
receive, from the trust funds described in subparagraph (d) hereof, (i) payment
of the principal of and each installment of principal of and interest on the
outstanding Securities of such Series on the Stated Maturity of such principal
or installment of principal or interest and (ii) the benefit of any mandatory
sinking fund payments applicable to the Securities of such Series on the day on
which such payments are due and payable in accordance with the terms of this
Indenture and the Securities of such Series;

<PAGE>

                  (b) the provisions of Sections 2.4, 2.7, 2.8, 8.2, 8.3 and
8.5; and

                  (c) the rights, powers, trust and immunities of the Trustee
hereunder;

                  provided that, the following conditions shall have been
satisfied:

                  (d) the Company shall have deposited or caused to be deposited
irrevocably with the Trustee as trust funds in trust for the purpose of making
the following payments, specifically pledged as security for and dedicated
solely to the benefit of the Holders of such Securities, (i) in the case of
Securities of such Series denominated in Dollars, cash in Dollars (or such other
money or currencies as shall then be legal tender in the United States) and/or
U.S. Government Obligations, or (ii) in the case of Securities of such Series
denominated in a Foreign Currency (other than a composite currency), money
and/or Foreign Government Obligations, which through the payment of interest and
principal in respect thereof, in accordance with their terms, will provide (and
without reinvestment and assuming no tax liability will be imposed on such
Trustee), not later than one day before the due date of any payment of money, an
amount in cash, sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge each installment of principal
(including mandatory sinking fund or analogous payments) of and interest, if
any, on all the Securities of such Series on the dates such installments of
interest or principal are due;

                  (e) such deposit will not result in a breach or violation of,
or constitute a default under, this Indenture;

                  (f) no Default or Event of Default with respect to the
Securities of such Series shall have occurred and be continuing on the date of
such deposit or during the period ending on the 91st day after such date;

                  (g) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel to the effect that (i) the
Company has received from, or there has been published by, the Internal Revenue
Service a ruling, or (ii) since the date of execution of this Indenture, there
has been a change in the applicable Federal income tax law, in either case to
the effect that, and based thereon such Opinion of Counsel shall confirm that,
the Holders of the Securities of such Series will not recognize income, gain or
loss for Federal income tax purposes as a result of such deposit, defeasance and
discharge and will be subject to Federal income tax on the same amount and in
the same manner and at the same times as would have been the case if such
deposit, defeasance and discharge had not occurred;

                  (h) the Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made by the Company with
the intent of preferring the Holders of the Securities of such Series over any
other creditors of the Company or with the intent of defeating, hindering,
delaying or defrauding any other creditors of the Company;

                  (i) such deposit shall not result in the trust arising from
such deposit constituting an investment company (as defined in the Investment
Company Act of 1940, as amended), or such trust shall be qualified under such
Act or exempt from regulation thereunder; and

                  (j) the Company shall have delivered to the Trustee an
Officers' Certificate stating that all conditions precedent provided for
relating to the defeasance contemplated by this Section have been complied with.

         Section 8.4       COVENANT DEFEASANCE.

                  Unless this Section 8.4 is otherwise specified pursuant to
Section 2.2.20 to be inapplicable to Securities of any Series, on and after the
91st day after the date of the deposit referred to in subparagraph (a) hereof,
the Company may omit to comply with any term, provision or condition set forth
under Sections 4.2, 4.3, 4.4, 4.5, 4.6, and

<PAGE>

5.1 as well as any additional covenants contained in a supplemental indenture
hereto for a particular Series of Securities or a Board Resolution or an
Officers' Certificate delivered pursuant to Section 2.2.20 (and the failure to
comply with any such covenants shall not constitute a Default or Event of
Default under Section 6.1), with respect to the Securities of such Series,
provided that the following conditions shall have been satisfied:

                  (a) with reference to this Section 8.4, the Company has
deposited or caused to be irrevocably deposited (except as provided in Section
8.2(c)) with the Trustee as trust funds in trust, specifically pledged as
security for, and dedicated solely to, the benefit of the Holders of such
Securities, (i) in the case of Securities of such Series denominated in Dollars,
cash in Dollars (or such other money or currencies as shall then be legal tender
in the United States) and/or U.S. Government Obligations, or (ii) in the case of
Securities of such Series denominated in a Foreign Currency (other than a
composite currency), money and/or Foreign Government Obligations, which through
the payment of interest and principal in respect thereof, in accordance with
their terms, will provide (and without reinvestment and assuming no tax
liability will be imposed on such Trustee), not later than one day before the
due date of any payment of money, an amount in cash, sufficient, in the opinion
of a nationally recognized firm of independent certified public accountants
expressed in a written certification thereof delivered to the Trustee, to pay
principal and interest, if any, on and any mandatory sinking fund in respect of
the Securities of such Series on the dates such installments of interest or
principal are due;

                  (b) such deposit will not result in a breach or violation of,
or constitute a default under, this Indenture;

                  (c) no Default or Event of Default with respect to the
Securities of such Series shall have occurred and be continuing on the date of
such deposit or during the period ending on the 91st day after such date;

                  (d) the Company shall have delivered to the Trustee an Opinion
of Counsel confirming that Holders of the Securities of such Series will not
recognize income, gain or loss for federal income tax purposes as a result of
such deposit and defeasance and will be subject to federal income tax on the
same amounts, in the same manner and at the same times as would have been the
case if such deposit and defeasance had not occurred;

                  (e) the Company shall have delivered to the Trustee an
Officers' Certificate stating the deposit was not made by the Company with the
intent of preferring the Holders of the Securities of such Series over any other
creditors of the Company or with the intent of defeating, hindering, delaying or
defrauding any other creditors of the Company; and

                  (f) the Company shall have delivered to the Trustee an
Officers' Certificate stating that all conditions precedent herein provided for
relating to the defeasance contemplated by this Section have been complied with.

         Section 8.5       REPAYMENT TO COMPANY.

                  The Trustee and the Paying Agent shall pay to the Company upon
request any money held by them for the payment of principal and interest that
remains unclaimed for two years. After that, Securityholders entitled to the
money must look to the Company for payment as general creditors unless an
applicable abandoned property law designates another person.

                                   ARTICLE IX.

                             AMENDMENTS AND WAIVERS

         Section 9.1       WITHOUT CONSENT OF HOLDERS.

<PAGE>

                  The Company and the Trustee may amend or supplement this
Indenture or the Securities of one or more Series without the consent of any
Securityholder:

                  (a) to cure any ambiguity, defect or inconsistency;

                  (b) to comply with Article V;

                  (c) to provide for uncertificated Securities in addition to or
in place of certificated Securities;

                  (d) to make any change that does not adversely affect the
rights of any Securityholder;

                  (e) to provide for the issuance of and establish the form and
terms and conditions of Securities of any Series as permitted by this Indenture;

                  (f) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or more
Series and to add to or change any of the provisions of this Indenture as shall
be necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee; or

                  (g) to comply with requirements of the SEC in order to effect
or maintain the qualification of this Indenture under the TIA.

         Section 9.2       WITH CONSENT OF HOLDERS.

                  The Company and the Trustee may enter into a supplemental
indenture with the written consent of the Holders of at least a majority in
principal amount of the outstanding Securities of each Series adversely affected
by such supplemental indenture (including consents obtained in connection with a
tender offer or exchange offer for the Securities of such Series), for the
purpose of adding any adverse provisions to or changing in any adverse manner or
adversely eliminating any of the provisions of this Indenture or of any
supplemental indenture or of modifying in any adverse manner the rights of the
Securityholders of each such Series. Except as provided in Section 6.13, the
Holders of at least a majority in principal amount of the outstanding Securities
of each Series affected by such waiver by notice to the Trustee (including
consents obtained in connection with a tender offer or exchange offer for the
Securities of such Series) may waive compliance by the Company with any
provision of this Indenture or the Securities with respect to such Series.

                  It shall not be necessary for the consent of the Holders of
Securities under this Section 9.2 to approve the particular form of any proposed
supplemental indenture or waiver, but it shall be sufficient if such consent
approves the substance thereof. After a supplemental indenture or waiver under
this section becomes effective, the Company shall mail to the Holders of
Securities affected thereby and, if any Bearer Securities affected thereby are
outstanding, publish on one occasion in an Authorized Newspaper, a notice
briefly describing the supplemental indenture or waiver. Any failure by the
Company to mail or publish such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such supplemental
indenture or waiver.

         Section 9.3       LIMITATIONS.

                  Without the consent of each Securityholder affected, an
amendment or waiver may not:

                  (a) change the amount of Securities whose Holders must consent
to an amendment, supplement or waiver;

                  (b) reduce the rate of or extend the time for payment of
interest (including default interest) on any Security;

<PAGE>

                  (c) reduce the principal or change the Stated Maturity of any
Security or reduce the amount of, or postpone the date fixed for, the payment of
a sinking fund or analogous obligation, if any;

                  (d) reduce the principal amount of Discount Securities payable
upon acceleration of the maturity thereof;

                  (e) waive a Default or Event of Default in the payment of the
principal of or interest, if any, on any Security (except a rescission of
acceleration of the Securities of any Series by the Holders of at least a
majority in principal amount of the outstanding Securities of such Series and a
waiver of the payment default that resulted from such acceleration);

                  (f) make the principal of or interest, if any, on any Security
payable in any currency other than that stated in the Security;

                  (g) make any change in Sections 6.8, 6.13, 9.3 (this
sentence), 10.15 or 10.16; or

                  (h) waive a redemption payment with respect to any Security or
change any of the provisions with respect to the redemption of any Securities.

         Section 9.4       COMPLIANCE WITH TRUST INDENTURE ACT.

                  Every amendment to this Indenture or the Securities of one or
more Series shall be set forth in a supplemental indenture hereto that complies
with the TIA as then in effect.

         Section 9.5       REVOCATION AND EFFECT OF CONSENTS.

                  Until an amendment or waiver becomes effective, a consent to
it by a Holder of a Security 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 or waiver becomes
effective.

                  Any amendment or waiver once effective shall bind every
Securityholder of each Series affected by such amendment or waiver unless it is
of the type described in any of clauses (a) through (g) of Section 9.3. In that
case, the amendment 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 9.6       NOTATION ON OR EXCHANGE OF SECURITIES.

                  The Trustee may place an appropriate notation about an
amendment or waiver on any Security of any Series thereafter authenticated. The
Company in exchange for Securities of that Series may issue and the Trustee
shall authenticate upon request new Securities of that Series that reflect the
amendment or waiver.

         Section 9.7       TRUSTEE PROTECTED.

                  In executing, or accepting the additional trusts created by,
any supplemental indenture permitted by this Article or the modifications
thereby of the trusts created by this Indenture, the Trustee shall be entitled
to receive, and (subject to Section 7.1) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture. The Trustee shall sign
all supplemental indentures, except that the Trustee need not sign any
supplemental indenture that adversely affects its rights.

<PAGE>

                                   ARTICLE X.

                                  MISCELLANEOUS

         Section 10.1      TRUST INDENTURE ACT CONTROLS.

                  If any provision of this Indenture limits, qualifies, or
conflicts with another provision which is required or deemed to be included in
this Indenture by the TIA, such required or deemed provision shall control.

         Section 10.2      NOTICES.

                  Any notice or communication by the Company or the Trustee to
the other is duly given if in writing and delivered in person or mailed by
first-class mail:

                  if to the Company:

                  IVAX Corporation
                  4400 Biscayne Boulevard
                  Miami, Florida 33137
                  Attention:  General Counsel

                  if to the Trustee:

                  U.S. Bank Trust, National Association
                  190 East 5th Street
                  St. Paul, Minnesota   55101
                  Attention:  Richard Prokosch, Corporate Finance

                  The Company or the Trustee by notice to the other may
designate additional or different addresses for subsequent notices or
communications.

                  Any notice or communication to a Securityholder shall be
mailed by first-class mail to his address shown on the register kept by the
Registrar and, if any Bearer Securities are outstanding, published in an
Authorized Newspaper. Failure to mail a notice or communication to a
Securityholder of any Series or any defect in it shall not affect its
sufficiency with respect to other Securityholders of that or any other Series.

                  If a notice or communication is mailed or published in the
manner provided above, within the time prescribed, it is duly given, whether or
not the Securityholder receives it.

                  If the Company mails a notice or communication to
Securityholders, it shall mail a copy to the Trustee and each Agent at the same
time.

         Section 10.3      COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.

                  Securityholders of any Series may communicate pursuant to TIA
Section 312(b) with other Securityholders of that Series or any other Series
with respect to their rights under this Indenture or the Securities of that
Series or all Series. The Company, the Trustee, the Registrar and anyone else
shall have the protection of TIA Section 312(c).

<PAGE>

         Section 10.4      CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.

                  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 or an Officers' Certificate stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with.

         Section 10.5      STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.

                  Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA Section 314(a)(4)) shall comply with the provisions of
TIA Section 314(e) and shall include:

                  (a) a statement that the person making such certificate or
opinion has read such covenant or condition;

                  (b) 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;

                  (c) a statement that, in the opinion of such person, he has
made such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has been
complied with; and

                  (d) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.

         Section 10.6      RULES BY TRUSTEE AND AGENTS.

                  The Trustee may make reasonable rules for action by or a
meeting of Securityholders of one or more Series. Any Agent may make reasonable
rules and set reasonable requirements for its functions.

         Section 10.7      LEGAL HOLIDAYS.

                  Unless otherwise provided by Board Resolution, Officers'
Certificate or supplemental indenture for a particular Series, a "Legal Holiday"
is any day that is not a Business Day. 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 10.8      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 Securities or the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. Each Securityholder by accepting a
Security waives and releases all such liability. The waiver and release are part
of the consideration for the issue of the Securities.

         Section 10.9      COUNTERPARTS.

                  This Indenture may be executed in any number of counterparts
and by the parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.

         Section 10.10 GOVERNING LAWS.

<PAGE>

                  THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY THE
LAWS OF THE STATE OF FLORIDA APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED
IN SUCH STATE, WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS THEREOF.

         Section 10.11     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 10.12     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 10.13     SEVERABILITY.

                  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 10.14     TABLE OF CONTENTS, HEADINGS, ETC.

                  The Table of Contents, Cross-Reference Table, 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.

         Section  10.15    SECURITIES IN A FOREIGN CURRENCY OR IN ECU.

                  Unless otherwise specified in a Board Resolution, a
supplemental indenture hereto or an Officers' Certificate delivered pursuant to
Section 2.2 of this Indenture with respect to a particular Series of Securities,
whenever for purposes of this Indenture any action may be taken by the Holders
of a specified percentage in aggregate principal amount of Securities of all
Series or all Series affected by a particular action at the time outstanding
and, at such time, there are outstanding Securities of any Series which are
denominated in a coin or currency other than Dollars (including ECUs), then the
principal amount of Securities of such Series which shall be deemed to be
outstanding for the purpose of taking such action shall be that amount of
Dollars that could be obtained for such amount at the Market Exchange Rate at
such time. For purposes of this Section 10.15, "Market Exchange Rate" shall mean
the noon Dollar buying rate in New York City for cable transfers of that
currency as published by the Federal Reserve Bank of New York; provided,
however, in the case of ECUs, Market Exchange Rate shall mean the rate of
exchange determined by the Commission of the European Union (or any successor
thereto) as published in the Official Journal of the European Union (such
publication or any successor publication, the "Journal"). If such Market
Exchange Rate is not available for any reason with respect to such currency, the
Trustee shall use, in its sole discretion and without liability on its part,
such quotation of the Federal Reserve Bank of New York or, in the case of ECUs,
the rate of exchange as published in the Journal, as of the most recent
available date, or quotations or, in the case of ECUs, rates of exchange from
one or more major banks in the City of New York or in the country of issue of
the currency in question or, in the case of ECUs, in Luxembourg or such other
quotations or, in the case of ECUs, rates of exchange as the Trustee, upon
consultation with the Company, shall deem appropriate. The provisions of this
paragraph shall apply in determining the equivalent principal amount in respect
of Securities of a Series denominated in currency other than Dollars in
connection with any action taken by Holders of Securities pursuant to the terms
of this Indenture.

                  All decisions and determinations of the Trustee regarding the
Market Exchange Rate or any alternative determination provided for in the
preceding paragraph shall be in its sole discretion and shall, in the absence of
manifest

<PAGE>

error, be conclusive to the extent permitted by law for all purposes and
irrevocably binding upon the Company and all Holders.

         Section 10.16     JUDGMENT CURRENCY.

                  The Company agrees, to the fullest extent that it may
effectively do so under applicable law, that (a) if for the purpose of obtaining
judgment in any court it is necessary to convert the sum due in respect of the
principal of or interest or other amount on the Securities of any Series (the
"Required Currency") into a currency in which a judgment will be rendered (the
"Judgment Currency"), the rate of exchange used shall be the rate at which in
accordance with normal banking procedures the Trustee could purchase in the City
of New York the Required Currency with the Judgment Currency on the day on which
final unappealable judgment is entered, unless such day is not a New York
Banking Day, then, the rate of exchange used shall be the rate at which in
accordance with normal banking procedures the Trustee could purchase in the City
of New York the Required Currency with the Judgment Currency on the New York
Banking Day preceding the day on which final unappealable judgment is entered
and (b) its obligations under this Indenture to make payments in the Required
Currency (i) shall not be discharged or satisfied by any tender, any recovery
pursuant to any judgment (whether or not entered in accordance with subsection
(a)), in any currency other than the Required Currency, except to the extent
that such tender or recovery shall result in the actual receipt, by the payee,
of the full amount of the Required Currency expressed to be payable in respect
of such payments, (ii) shall be enforceable as an alternative or additional
cause of action for the purpose of recovering in the Required Currency the
amount, if any, by which such actual receipt shall fall short of the full amount
of the Required Currency so expressed to be payable, and (iii) shall not be
affected by judgment being obtained for any other sum due under this Indenture.
For purposes of the foregoing, "New York Banking Day" means any day except a
Saturday, Sunday or a legal holiday in the City of New York on which banking
institutions are authorized or required by law, regulation or executive order to
close.

<PAGE>

                  IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the day and year first above written.

                                       IVAX CORPORATION

                                       By:
                                          ----------------------------------
                                                Name:
                                                Its:

                                       U.S. BANK TRUST, NATIONAL ASSOCIATION

                                       By:
                                          ----------------------------------
                                                Name:
                                                Its:

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