Tobacco Documents Online

F .. F ~ .. •_aar~ 1 ~~ ..f...._ .~ ' ..>.. s.y.~~ . r " managing underwriter shall request, that it will not sell or offer for agrees now, and agrees to sign such supplemental agreements that the~z offering and Standard shall have declined to accept such offer, Standard . .,.. . ... ...- .. . ... ..... . .. . - . . - - .. .. ... . , _ .i . . ,... .. ....- _ .,' /. , ... .;'.' .1"n ... '.'.. •_-L;...- `.. .. .. _. .; ..~ ..~, . . . . . : ~= - In the event that Cetus proposes to register any shares of. c Common Stock for the purpose of:an underwritten public offering and-.; shall have offered to include as a part of such offering Restricted r Stock as to which registration shall have been requested by Standard~ ;'fpursuant to this Section 9.5 on the same terms as shares of Common Stock ,.,.; are to be sold by Cetus'`and/or by other selling stockholders in such~~ W a'":u.-, . .. . . .. . ~ 4 sale any Restricted Stock pursuant to the Registration Statemen`t covering ~~~~~r Rx such offering until 90 days after the effective date of the Registration ;~,:' ~t Statement ~-p.l,~. .~ 'S~? a.f • ~ •' t ~ 4~} : 'F ~ Y''N Vc..~+' A. S.. : a • .. . . f 1" E ' '' . ..: - . . . ... ... .' _ . ... . . . . .{ }~~. 4.~.T.T.N...`.fq'4~ If"tlie offeririz to which the proposed re2istration und~eir t is ! ~Section 9.5 relates is to be distributed by or through an underwriter` ~: or undert~rriters Standard •if requested by such 'under.oriters`r, shallr agree '. , to sell its Res tricted Stock that is sub j ect to the Registratiori State ment to or throu g h such, underwriters at the same price . to be paid to Cetus or selling stockholders if Cetus or selling stockholders offering Common Stock; provided, however, if in the opinion•of the ,.~ . ` managing under~oriter the registration of all the Restricted Stock which : Standard has requested 'to be included would materially- aiid adversely affect such public offering," then Cetus shall be required to register~ only that number of shares of Restricted Stock, if any; which the . , . ._ , , . . <'.. ~.. ._ . i~ „ managing underwriter believes may be sold without causing such adverse e c pim t a 1' ffe ,~ y- ,i r i ~ 9, 6- R~istration Procedures , n If and whenever Cetus is required by the provisions of this Section 9 to use its best efforts to effect the R~ registration of any of the Restricted Stock under the Securities.Act ~ ~ . ... .. kT^~ ~.. ~ Cetus shall r d A ~s r c >J ~. +e. O ~",~t7 .Ll~ Jial ? 5 ' f thti 961:ithi 90f Ct .. wn days oeuss receipt oe noce specified in Sections 9.4 and 9.5, file with the Commission a Registration Statement with respect to such Restricted Stock and use its best efforts 't'aaJ . i.+. to cause that Registration Statement to become and remain effective for thirty days, if necessary, following its effective date, n~L P~ ..~! *?'i, l.a.+..c,~.:r.:'I.E.J f~'2~'S~y{Y -. ~ ,`:4 s_t~ ~- _.. 9.6.2. as expeditiously as possible prepare and file •?.with b.the Commission any amendments and supplements to the Registration State- ' ment and the prospectus included in the Registration Statement-as~may be ' : necessary to keep the Registration Statement effective and to.comply with the provisions of the Securities Act with respect to the' sale ortother ^ ..;,Act, and. such other documents as Standard may reasonably request in order to facilitate the public sale or other disposition of the Restricted ~~ Stock owned by Standard; tr ~-. ~ . ... . .. _ . . . . .. . . , .. . • .. + .. . . .. . , . -. . : ~,5~ . ~ ~ c:'.>e , . ~Cit~Y4. 9.6.3. as expeditiously as possible furnish to Standard such reasonable numbers of copies of the prospectus,"including a pre-l,~ ;,~,`~ ~, ~r,.,l+iminary prospectus, in conformity with the •requirements of theSecurities ; disposition of all securities covered by the Registration,Statement for . ! ,...a- ..~,..., ~,.a period of not more than thirty days after its effective date;, . t Y - 11 - ~ I !ff~ t , 4- ..,..., ...... .: -..qi::~•~

-. . . ., . ,....~_.. .... . . _ ....x.,P,~`.t•.•.,.__.. . . ~' ' - rxY~~-=;~ . ..= ..~ . .. . • . ., . .. . .:.: .. .. . . y .. .:. -..., , .... ... . .. 9.6.4. as expeditiously as possible use its best efforts F~ however, tha•t Cetus shall not be required in connection with this Section .~ 9.6.4. to qualify as a foreign corporation or execute a general consent "';:n to service of process in any jurisdiction. Xt; ~A i d d ng done so the prospectus shoul be amen Standard and after hav ed to comply with the requirements of the Securities Act, •the company shall " w r* r jurisdictions as Standard shall reasonably request, and to do any and , all other acts and_ things that may be necessary or desirable to enable `" ` Standard to consummate the public saleor"other disposition in such,- t jurisdictions of'the Restricted Stock owned by Standard; provided,a~~~ to register or qualify the Restricted Stock covered by the Registration Statement under the securities or Blue Sky laws of such states , . `- "~3~~3 r~ ~3 `"'z~" If Cetus has delivered prelir..inary or final prospectuses to , = ~promptlynotify Standard and, if.requested,:Standard shall immediately '~ cease making offers~of Restricted Stock and return all prospectuses-to , Cetus:f:Cetus shall'promptly provide Standard,with revised prospectuses ~..z{ ~ • and, following}receipt of the.revised ,prospectuses , Standard shall be : ~ J ~• j ~.:.,... .: . 4 .. . .. .. ~ r ~ . , free to resur e making offers of the Restricted Stock. t where the Shares are to be offered requires some other, allocation of ~ fees and expenses, and theexpense of any special audits incident.to or a ,r,~w expenses,„fees and disbursements of coun•sel for Cetus, State Blue Sky " including, without limitation, all registration and filing fees, printing . ~ , , ~9 7;; Allocation of Experises.: ;""Registration Expenses" shall '~`~ inean alI'expenses incurred by Cetus in complying with this Section 9,9 t--- ..' ~~ l~`r0 ~~rii n , and selling commissions. Unless the Blue Sky Couniissioner of any state ~ f ,_ .. ~ : required by any such registration but excluding underwriting discounts =~*A 'expenses Cets willay'all Registration Expenses in connection with,a bo`u p ~ ra`a q~ registration pursuant to Section 9.4 and 9. 5, except (i) those of ,:gd'~ " nt ha hd ty bt frtheritti expenese cmpanwouoveao pauo..egsraon ;. 's thoyld registration fees payable to the Commission_~ T~ Standard's counsel', (ii) with respect to Standard's Restricted Stock, (iii) additional registration and NASD fees based_upon Standard's shares, and (iv) similar additional ~i :. ~ "" ' ~ . .. r i ,. ,~ ..~ . ~ ~ of Standard!~s~ shares. If; in *connection"with a registration under Section 9.4; the 'Co:umission shall-require Cetus to submit audited financial statements for a period subsequent to-Cetus's most recent fiscal year, Cetus shall M1 ~^ f , [ with a Registration-Statement initially filed pursuant to•Section 9.4 4.:;~ unless it shall have received written assurances• from Standardd that : it '.;:. " " notify Standard of that fact`.,. Cetus shall have no obligation to proceed 4 a:~~~ if any, who controls Standardwithin the meaning of the Securities Act~ ~ of"the Restricted Stock under the Securities Act pursuant to this Section* 9;.Cetus will_indemnify and hoZd harmless Standard and each other:person, 9.8" Indemnifieation. In ths event ofany registration ation of any exceed $25,000. ' "''' :' ' ~ ~' :hll reibuseese csts fihdid ficil samr Ctu for thoo preparng suc autenana ,: statements; provided, however, that the maximum amount"of such costs : . which•Standard would be obligated,to reimburse Cetus hereunder shall not,>:' u ~ ar a I:? , r ;,. :,-

against any losses, claims, damages, or liabilities, joint or several, to which Standard or such controlling person~may become subject under the Securities Act or otherwise, insofar as such losses, claims, damages, or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement of any material fact contained in any Registration Statement under which such Restricted Stock was registered under the Securities Act, any preliminary prospectus or final prospectus contained in the Registration Statement, or any at:endr~ent or supplement w~ to the Registration Statement, or arise out of or are based upon the omission or alleged omission to state a material fact required to be stated in the Registration Statement or necessary to make the statements in the Registration Statement not misleading; andCetus will reimburse Standard, and each such controlling person for any legal or any other ~ expenses reasonably incurred by Standard or such controlling person in ~~ ~connection with investigating or defending any such loss; claim, damage, ~ ,or liability; provided,'however, that Cetus will not be liable in any ;such case to the extent that any"such loss, claim, damage; or liability arises out of or is based upon any untrue statement or alleged untrue - statement"or omission'_or alleged omission made in the Registration State- __.. ._. ._ ~u ment, preliminary prospectus or prospectus, or the amendment or supplement in reliance upon and in conformity with written information furnished to Cetus through an•instrument duly executed by Standard or any underwriter of such shares specifically for use in the preparation thereof. ~:T ~ _.. --Y{-_. . . _ . .. _ . .. . . _, _.. . _. 3H In the event of any registration of any of the Restricted Stock .under the Securities Act pursuant to this Section 9, Standard will indemnify and hold harmless Cetus, each of its directors and officers an&each person, if any who controls Cetus within the meaning of the ~ Securities Act, and each underwriter, with respect to any statement in or omission from any Registration Statement or preliminary or final prospectus, if the statement or omission was made in reliance upon and in conformity with information furnished in writing to Cetus by Standard or on its behalf specifically for use in connection with the preparation of the Registration Statement or prospectus. !.V 9.9 Opinion Letter. Notwithstanding any of the foregoing pro- visions of this Section 9 to the contrary, Cetus shall have no obligation to file a Registration Statement on Standard's behalf or to notify Standard of the filing of any Registration Statement on its own behalf at any time after Cetus receives and delivers to Standard an opinion of Cetus' counsel, reasonably satisfactory to StandardIs counsel,*to the effect that the offer and'sale of the shares of Restricted Stock, in the manner in which Standard proposes to dispose of such shares as described in its request, are not required to be registered under the Securities Act. I , •r , s <, ~ :rJ } z 1•,> i' .. t7 Section 10. Additional Financing by Cetus ~Z! =.:~:1T•; Cri .. .,~~;. - Should Cetus hereafter determine to raise additional capital for the '-... purposes set forth in Section 3 it shall afford Standard the first right 'f 4, to be the purchaser of such securities on the terms and conditions set f'" ~ forth in this Section 10. ,: <=:~s - 13 - - AN r

tr -,10.I Type of Securities to be Sold ;. Except for the first $5,000,000 of debt instruments given by ~.Ce tus in consideration of_ the purchase by it of laboratory_ ~',.,_ ~ equipment, laboratory or production facilities, or new t.s•• c fi~Y technology, Cetuss agrees that the first $6,000,000 of se-,;;a:: . curities, other than the Debentures, to be sold by it during :'r~ ~ u3x Y~,_ the period beginning on the date of this Agreement andending ,ijj on December 31, 1982, shall be offered to Standard in'the form of Cetus'. $0.0375 per share par value Common Stock, and that the next $3,000,000 of securities to be sold during such:'^J~.;•~~; period shall be offered to Standard in the form of debt con `~r ~f4u1 Common Stockof Cetus.- : After a tota- - securitil of , curities shall hav $9OOO000nof ,es , ~~~e been sold during the indicated period, or upon expiration of the indicated period,` Cetus shall be s..s at,liberty~ to : sell whatever form of additional fi.a T~ :. . ___~._.__. .. .-___....,..._ _ securities it may electwitho t u reference to this Section 10 '~ •.. t' ~ p i :'3Ll7vf;S:~..?~sl?'. Notice to Standard of Cetus Determination to Sell Securitie s.1 Durin t ~ ~ ~ g he periodsifid i Sti 101 if C „pecenecon.etus elects ; to sell the securities contemplated.in.such section it shall :''~ ~ notify Standard of such fact in writing specifying the type "" and total amount of securities' to be sold and an estir,:ated '~ . date of sale. No more than two such notices shall be served 4~~ ~x+ ~~~•j~, on Standard during any twelve month period and no"notice shall specify an amount of securities to be sold ' of less than $1, 000, 000 nor more than $5,000,000.,; No notice may be served prior to ; the Second Closing Date. : After receipt of the notice Standard :Y shall have 30 days in which to elect to purchase such securities, r~ s, *::a' k'hich election shall be communicated to Cetus in writing.'c A: failure to respond within 30 days •after Standard's receipt of .'{ notice shall be, considered a refusal to purchase the securities. fne 103 Terms of Sale of Common Stock . (~' e ' c. cs~?t.~s r~~ :. If Cetus notifies Standard of its intent to sell shares W, , ._ of its Common Stock and Standard exercises its right to I ~-; purchase such shares the price of such shares shall be' oti; $15.00 per share (the "Stock Purchase Price"); provided~ ~ , however, that the Stock Purchase Price shall be adjusted hereaf ter. in the same manner as the Conversion Price is '~' ; adjusted pursuant to Section 6 of the Debentures.:',I rt Zoizvi -i`_ r3Pr?ti 10.4 Terms of Sale of Convertible Debt ~ ~ . - . . . - ~ . . . - . .. ~ ~ . . . 4 . . . If Cetus notifies Standard of its intent to sell con-::~2 vertible debt and Standard exercises its right to purchase' ;~,;, ,. such securities, the convertible debt will, be sold on terms jL F_-.substantially the same -as the Debentures, including a:~~ ~~ '~^ql1C~ i;b f3v: (a) the maturity shall be 15 years from the date*of issue,

r (ti) the interest rate shall be the same nuzber of percentage points above or below the Prime Rate as quoted by The First National Bank of Chicago <: on the 5th day preceding the date of closing as the interest rate on the Debentures is*above .or below such prime rate on the First Closing r-: Date, but in no event shall such rate be less than 6.0% per annum nor greater than 10.0% per annum; provided, however that if such rate is ~I c4 :a .c, . : higher than the highest rate permitted by g governing law then such highest lawf ul rate"~: shall apply.'~`.~~:d~ i.~fi3 '~0 `.~J'in.ls.~'~, r iz :YC li' '~~- • ~ .~ ~ ~. ', '~e~ ~'- .~. ~ , ~':: _. .. . . .... v -.~ :. . ~..'' . ... ....~ , ... .r. •. ....:... ..... . . . . (c) the conversion price shall be $15:00'per share subject to adjustments in such price from the First Closing Date in the same manner"and for the same occurrences as specified in Section 6 of the Debentures ; ~ ~d the debt shall be convertible for'a period endin g*" ~ on the 5th day preceding tlie date'd "` of maturity, an ~ SiU r} tr i . (e) such other provisions for-prepayment,'conversion, registration, etc. as shall make such debt sub- '` stantially equivalent to the Debentures. c } 10'.5 Cetus Right to Sell Securities to Third Parties ".., w ,: If Standard shall refuse or fail to~exercise'its~right to purchase the shares offered pursuant'to Section 10.3 or thei~ debt offered pursuant to Section 10.4-after having been e:.,_ given the opportunity to do so, then Cetus will be at liberty for a period of 180 days after such refusal or failure to complete a sale of such securities•to another party; provided, that (a) such sale may not be for a price for Common Stock less,than Standard would have been required to pay unless ' Standard shall again have been offered the election to pur- chase such Common.Stock at such lesser price in accordance with the procedures set forth in Sections 10.2 and 10.3, (b) no convertible debt sold shall have 'a `conversion price } -'less than Standard would have been'requ 'Zixed to pay unless d~ Standard shall again have been offered the election to' purchase such convertible debentures in accordance with the r procedures set forth in Sections 10.2 and I04 and (c) except , ., N_ 000 of any debt sold`,' for the first $5,000,to third persons, `: all such debt shall be unsecured and rank equally with the ~ Debentures. -Standard agrees to execute 'such documents as a third party lender may reasonably require to`subordinate the liens of the Debentures to the first $5000000 of sh ,,uc subsequent f inancing. 7~ (:': ~xr4,.is.F~ A T 17rC( i~~SJa4 :3a ~tl .. ~i}~ert~ J~J"w :0 a4~'iiJl.t...~Y.:.7L ~M T _ ' r L l.< r.~~~~ x _ 15

10.6 Effect of a Refusal by Standard to Purchase Securities If Cetus, within the period specified in Section 10.1 and before Standard has been offered the election to purchase a total of $9,000,000 of Common Stock and convertible debt under Section 10, makes a•bona fide offer to Standard to sell Common Stock pursuant to Sections 10.2 and 10.3 or convertible deventures pursuant to Sections-10.2 and 10.4 in order to fund a written research.or development program which has been approved by the Board of Directors of Cetus and Standard, being free to accept such offer, refuses to purchase such securities then the Conversion Price set forth in Section 6.4 of the Debentures.shall be increased in accordance with the following Z'i4y „ NCP =^ CP (1 + 0 075) where: "NCP" is the New Conversion_Price; and CP is the Conversion Price in effect oa the day Cetus makes the offer to Standard. . ..,. ,. 10.7 Limitation on Other Financir_gs ,;,o~ Cetus agrees that until the earlier of (a) Common Stock and Convertible Debenture offerings to Standard in the aggregate of $9,000,000 have been made by Cetus or E, (b) August 1, 1982, Cetus will not erigage in any other .? S sale of securities without first offering to Standard the right of first refusal to purchase such securities. The ' ._, provisions of this Section shall not apply to the sale of Common Stock upon the exercise of stock options now out ;_~. standing or hereafter granted pursuant to any stock ogtioa program now existing or hereafter approved by the•share- ., • holders of Cetus- r ° 4 ~~ A Section 11. y Appointment of Dirertors Cetus agrees that for so long as Standard;`or any subsidiary of Standard, owns at least 143,000 shares of Common Stock, or securities convertible into at least that number of shares of Common Stock, of Cetus, Standard shall have the right to designate two individuals, who may be employees of.;-•' Standard, for nomination.to be elected as Directors of"Cetus, and the management will recommend to Cetus shareholders that such designees be elected and will cast sufficient discretionary proxies required for the election of such persons, in excess of the number of votes which Standard or its subsidiaries may be entitled to cast by virtue of its`ownership of. Preferred Stock or Common Stock. So long as Standard;"or any sub- sidiary of Standard oums at least 50% of the Debentures, the Board of Directors of Cetus will not adopt any plan or agreement of merger, reorganization, or consolidation or recommend to Cetus shareholders the adoption of any such plan or agreement unless such plan or agreement has first been approved in writing by the directors elected pursuant to'this Section 11.

® ® ® .; 'x~ ca~ ~'Y~w'~t 4 `~ ` ~ . ys:Section 12. Survival of A greenents ~~ ~" -s,A11 agreements, representations and warrantias made herein and ia any certificates delivered pursuant hereto shall survive the delivery of „ ± ; the Debentures hereunder and payment therefor an&sha1L continue in fulli ~ y:force and;effect so lono as the Debentures are outstanding, or if the ; " a "Debenturesare converted into Common Stock then with respect to Sections j~.,. 9, 10, and I,.~l; hereof to and including August 31, 1992 ° ~~hj ~~ '" ' ' L * t ei 5 5" ~~r z Section 13 Notices A~~j 1 notices and other couuhunications hereunder shall be in wniting, g~ E --and shall be delivered or mailed by first class registered or cerpified aail ostage re aid addressed (a) if to Standard at 200 East k s p o P P a a s ~~ Randolph Drive,; Chicago, Illinois 60601, Attention J. C. Vredenburgh, _- y~,ss Treasurer, or at such other address as Standard from time to time may 'Y 'have designated by notice to Cetus, or (b)~ if to Cetus, at 600 Bancroft ~ ~ Way, Berkeley,"California 94710, Attention Dr. Ronald Cape, President, or at such other address as Cetus from time to time may have designated by notice to Standard. ~ ~ Se'Tc tion 14Y.: Miscellaneous '' ~ This Agreement or any term hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of the change, waiver, discharge or termination is sought. All the terms of this Agreement shall be binding upon the r~ successors and assigns of the parties hereof. Any agreement or other `-4 „:docu:aent required by any provision hereof to be in the form of an Exhibit attached hereto shall be substantially in such form, with such changes therefrom, if any, as may be approved by the party to whom it is to be delivered. The headings in this Agreement are for convenience of ~; reference only and shall not define or limit the provisions hereof. This Agreement shall be construed in accordance with and governed by the laws of the State of California. ~r:. . - .. . . . . .. . ' . - ., ._ . . -. .. i ,- %*r F Witness Witness By Tiile: CETUS C0RP02ATI0N A/1 STANDARD OIL COMPANY By !5. Vice President In Witness k•hereof the parties hereto have caused this document to ..be executed by their duly authorized representatives as of the date first above written. c- .> U .. xs-? a r:.

EMBIT A _ .. . , i . . - ....r.. ~ _... __ . . .• _- r-- _ _. . .. i ; 7.5% Convertible Debentures Due August 1, 1992 C ;_ This Debenture and the Common Stock issuable on conversion of this . Tln}~ont..~rn 'kntvo -nt s,en.. en~~fo.-ed,+A-t1+e A..t ..F 1A7'1 _.1 .,{..;5. registration statement under the Securities Act of 1933 and an indenture ~ sold, transferred or otherwise disposed of in the absence of'an effective -Indenture Act of 1939. These securities may.iiot be pledged, hypothecated, an indenture has not been qualified with respect thereto under the Trust except under circumstances under which such registration and qualification qualified under the Trust Indenture Act of;1939 relating to the Debentures, . •e.l ,-. .._. 4 . ~ - 44 - r u:T ,., ,- . .~, are not required. a,.A..A . ..._iJ . .... , . ' ` - . ~' - . - . .. CETUS CORPORATION - ,:..~~:a.-. --,... ......... .. . _.. -r.. , ~... -~_2 the rate of 7.5% per annum, payable semiannually on August 1 and February 1 on the unpaid balance of such principal amount from the date hereof at amount of $,_.. .... .. (subject to prepayment as provided in ,.,.Section 2), and to pay interest (subject to the provisions of Section 8) :,:.~'~..... :....... - . .~c. - . :<'j' : . . .. .:_.:.. ,. ,. ..- .v : . . . .-L.. -, . .. - '~~: - . ~ . -a . ... 1.. .. .. . t _ ..v. . -.. .,.. ... _ . . . , .. . . _ .-. . . - . . .. - , . -. ~ .J . ... CETUS CORPORATION (the "Company"), a Delaware corporation, for value received, hereby promises to pay to STANDARD OIL CO:IFA:\'Y, an Indiana corporation ("Standard") or order, on August 1, 1992, the principal demand. All payments of principal, premium, if any, and interest shall . be made in lawful money of the United States of America by check mailed JwA on the second day preceding the due date to the holder of the Debenture, Q to 200 East Randolph Drive, Chicago, Illinois 60601 or such other address 0' in each year commencing February 1, 1978 until such principal amount shall become due and payable, (whether at the stated maturity or by ' required prepayment or notice of optional prepayment or declaration or otherwise), and on any overdue principal and premium, if any, payable semiannually as aforesaid or, at the option of the holder hereof, on O •5... 1,..1a.~.. ..f t1.o Te ?•%nnti.rc c1.~~l l. ...~n~tn to the in writin ~v~.~..u.a...~u~.... . . a~ u.~c iaviuca v~ ~.a~ ..~...~....~.~.. .,..u~ii g Company. '' Form of Debenture •~ N

1. Debentures. This Debenture is one of the Company's Debentures . due August 1, 1992 (the "Debentures", such term to include any Debentures issued in elchange therefor or in replacement thereof pursuant to Section 18, issued in the agoregate principal amount of $5,000,000 '. pursuant to the Debenture Purchase Agreement (the "Purchase Agreement"), dated July , 1977, between the Company and Standard. 2. Prepayment of Debentures. 2.1 Mandatory Prepa~-ments. The Company will prepay, as and for a fixed sin~:..ing fund:. (i) on Auo st =-~`Debentures at the time outstanding; such prepayment to be made at a 1, 1988 and on each August 1 thereafter to and including August 1, 1991, "'Two Hundred Fifty Thousand Dollars ($250,000) principal amount of the rice equal to 100% of the principal amount of the Debentures being prepaid without premium. All mandatory prepayments, and all optional = prepayments made during the period when mandatory prepayments are required 'shall be"without the payment of any accrued or past due interest, which ':~interest shall not thereafter be payable. Except as specifically provided in Section 2.2 below, no prepayment pursuant to any Section of this Debenture shall relieve the Company of its obligation to make the fixed prepayments provided for in this Section 2.1. ~:, '"2.2 Optional PrepaS-ment tdith Premium. On any Payment Date, the Company may, at its option, upon notice-as provided in Section 2.4, prepay the Debentures as a whole or in part from time to time, at a If Prepaid During 12-Month Period Ending August.1 , 1982. . . . . . . . . 4.50% . 1988. . : . .'. . ."": . 0.00% 1980. .' - . . . 6. 00% 1986. . . . ." . .:.: . . . 1.50% 1981. . . . . . 5.25% : _ 1987. . . . . . . . . 0.75% If Prepaid During : 12-Month Period Ending August l "" Premium 1978. . . . . 7.50% ;•. .1984. . . . . . : . . .'3.00% 1979. . .,'. ~ . ~ .`. 6.75% e 1985. . . . . . . 2,25% ... r,. _ . . t~ r 1983. . . . . 3.75% provided that prior to August 1, 1988, no prepayment pursuant to this Section 2.2 may be made directly or indirectly from or in anticipation of any proceeds of any indebtedness directly or indirectly created or incurred by the Company if such indebtedness has an interest rate or an ~ effective interest cost to maturity (determined in accordance with ~ generally accepted financial practice) to the obligor of less than 7.5% ~ per annum. A holder receiving notice that a Debenture is to be prepaid ~ price equal to 100% of the principal amount thereof being prepaid plus interest accrued thereon to the prepayment date, and plus the premium (percentage of such principal amount) applicable to such prepayre.^.t in • accordance with the folloi-jing, dependir•g.upon the 12-month period in `' %-- which such prepayment is made: ~fi.

r .. . . . ., z ... . . _ .. _ , i '.a3`~•.,~. provided in Section 6 hereof provided the notice of election to convert the Debenture is delivered to the Company not later than the fifth d.ay ''may nevertheless elect to present such DeSenture for conversion as preceding the date set for repayment; partial prepayment of the Debentures the aggregate principal amount of "'` 2.3 Application of Partial Prepay;aents.-~-:In the case of each the Debentures to be prepaid shall be allocated (in units of $1,000 or ...multip3es thereof) among the holders of all the Debentures at the time . outstandinR, in proportion, as nearly as practicable, to the respective unpaid aggregate principal amounts of the Debentures then held by thes, •,:;,,,4L p y2 J ~ ~ - _ $ . 4 ~ ..,4,: res ectivel with ad'ustnents to the ertent- practicable to e u-lize `' " 2,4 Notice of Prepayments...-In the case of each prepayment of the ~ ...,. ,.~,,. ,. ,~ ... ,... , ....~_.• ~, ~,r.. , 1.r,~ .. .. -~ ~ •. _._., ._ .. ..._._. . .. . . or any prior prepayments no exac y n suc propor t ion. r._.-.~ ~ ,.. ~ -`f t tl i h ' ` - '"1=60 days prior to the date on which such prepayment is required to be = notice thereof to each holder of the Debentures to be prepaid at least Debentures pursuant to Section 2 the Company will give written . the provisions of Section to Section 2.2 shall certify that such prepayment is not prohibited by Each notice of a prepayment to be made prior to Auoust 1, 1988, pursuant "=`on such date and the premium if any, applicable to such prepayment. •1 the Debentures, or portions thereof, held by such holder to be prepaid or portions thereof, to be prepaid on such date, the principal amount of -`case specifying such date, the aggregate principal amount of the Debentures, made or the date fixed for such prepayment, as the case may be, in each 2.7 No Reissue. All Debentures prepaid in full or presented for ~.i otherwise provided herein, and together with the premium, if any, applic- able to such prepayment. . , ... r, notation thereon as to the date and amount of.such partial prepayment. .. '3ac y t :, l :.. 2.6 Maturity of Prepayments. In the case of each prepayment of the Debentures, the principal amount of the Debentures, or portions thereof, to be prepaid shall mature and become due and payable on the date on which such prepayment is required to be made or on the date fixed in the notice of such prepayment, as the case may be, together with interest accrued to such date on such principal amount, except as " 2.5 Notations of Partial Prepayr•ients. Upon any partial prepayment of this Debenture, unless the Company shall have otherwise agreed in writing, the holder hereof shall present this Debenture to the Company at its address designated pursuant to Section 21 (or to such other representative as the Company may have authorized), for endorsement of a 0 to the Company f or cancellation and shall not thereafter be reissued. 0 conversion into Common Stock pursuant to Section 6 shall be surrendered - 3 - rP