EXHIBIT 10.52
                                                                  --------------



                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS

This amended and restated  agreement  respecting change of control and executive
benefit plan entitlements made as of the 23rd day of September, 2008.


BETWEEN:

                    NEXEN INC., a corporation  incorporated  under the
                    laws of Canada

                                  (hereinafter referred to as the "Corporation")

                                     - and -

                    CHARLES W. FISCHER

                                    (hereinafter referred to as the "Executive")

RECITALS:

1.       The Executive,  as President & Chief  Executive  Officer ("CEO") of the
         Corporation,  is considered by the Board to be an essential officer and
         employee of the Corporation,  who is both integral to the operation and
         development of the Corporation,  and has acquired  outstanding  skills,
         unique  experience  and  possesses  an  extensive  background  in,  and
         knowledge of, the Corporation's  business,  operations and the industry
         in which it is engaged.

2.       In the event of a Change of Control,  there is a  possibility  that the
         employment of the Executive  would be terminated  without just cause or
         adversely  modified and the  Executive  has  expressed  concern in that
         regard to the Corporation.

3.       The Board  recognizes that it is essential and in the best interests of
         the Corporation and its  shareholders  that the Corporation  retain the
         continued dedication of the Executive to the Executive's office and the
         Executive's employment during the uncertain period prior to, during and
         following a Change of Control.

4.       The Board  further  believes that the past service of the Executive and
         the  Executive's  integral role in the development and operation of the
         Corporation requires that the Corporation ensure that in the event of a
         Change of Control  the  Executive  is treated in a manner that is fair,
         reasonable,   consistent  with  industry  standards  and  in  the  best
         interests of the Corporation.

5.       The  Corporation  and the  Executive  entered  into a Change of Control
         Agreement  on  October  22,  1999,  which was  amended  by an  Amending
         Agreement   dated  December  25,  2000   (collectively   the  "Original
         Agreement") to agree on the terms and conditions which would govern the
         termination  or   modification  of  the  employment  of  the  Executive
         following a Change of Control.

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                                      -2-


6.       The Original  Agreement  was replaced and  superseded by an Amended and
         Restated  Change of Control  Agreement on December 13, 2001,  which was
         amended by an Amending Agreement dated May 30, 2003 (collectively,  the
         "Current   Agreement")  which,   among  other  matters,   detailed  the
         Corporation's security and funding obligations in respect of the Change
         of Control  Obligations  (as  hereinafter  defined),  provided  for the
         securitization  and funding of the Executive  Benefit Plan  Obligations
         (as  hereinafter  defined)  and  provided  for  the  cessation  of  the
         Executive's coverage under the Statement of Company Procedure Regarding
         the  Securitization of Nexen Inc.  Restated  Executive Benefit Plan, as
         amended or replaced from time to time (the "Securitization Procedure").

7.       The Corporation  and the Executive wish to amend the Current  Agreement
         as herein  provided  and,  in doing so,  wish to  restate  the  Current
         Agreement as herein amended (the "Restated Agreement").

NOW THEREFORE, in consideration of the mutual covenants and agreements set forth
in this Restated  Agreement and for other good and valuable  consideration,  the
receipt and  sufficiency of which are hereby  acknowledged  by the Parties,  the
Parties agree as follows:

                                    ARTICLE 1
                                   DEFINITIONS
                                   -----------

1.1      In this Restated Agreement, the following terms shall mean as follows:

         (a)      "ACTING  JOINTLY  OR IN  CONCERT"  for  the  purposes  of this
                  Restated  Agreement,  a Person is acting jointly or in concert
                  with  another   Person  if  such  Person  has  any  agreement,
                  arrangement or  understanding  (whether formal or informal and
                  whether  or not in  writing)  with such  other  Person for the
                  purpose  of  acquiring,  offering  to  acquire,  or voting any
                  Common  Shares  of  the  Corporation   (other  than  customary
                  agreements with and between  underwriters and banking group or
                  selling  group  members  with  respect  to a  distribution  of
                  securities  by way  of  prospectus  or  private  placement  or
                  pursuant to a pledge of securities  in the ordinary  course of
                  business).

         (b)      "ACTUARY" has the meaning  referred to in Section 11.2 of this
                  Restated Agreement.

         (c)      "AFFILIATE" and "ASSOCIATE"  have the meaning ascribed to such
                  terms in National Instrument 45-106.

         (d)      "ANNIVERSARY DATE" has the meaning referred to in Section 11.3
                  of this Restated Agreement.

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         (e)      "ANNUAL  BASE  SALARY"  means the  annual  base  salary of the
                  Executive  payable by the  Corporation at the end of the month
                  immediately preceding the Date of Termination.

         (f)      "ANNUAL  TARGET  BONUS" means the  Executive's  annual  target
                  bonus  as  determined  by the  Board to be in  effect  for the
                  calendar year in which a Change of Control occurs.

         (g)      "BANK" has the  meaning  referred  to in Section  11.2 of this
                  Restated Agreement.

         (h)      "BENEFICIAL   OWNER"  for  the   purposes  of  this   Restated
                  Agreement,  a Person  shall be  deemed  to be the  "BENEFICIAL
                  OWNER"  and  to  have   "BENEFICIAL   OWNERSHIP"   of  and  to
                  "BENEFICIALLY OWN":

                  (i)      any securities as to which such Person or any of such
                           Person's Affiliates or Associates is the owner at law
                           or in equity;

                  (ii)     any securities as to which such Person or any of such
                           Person's  Affiliates  or  Associates  has a right  to
                           acquire  (i) upon  the  exercise  of any  Convertible
                           Securities  or  (ii)   pursuant  to  any   agreement,
                           arrangement or  understanding,  whether such right is
                           exercisable immediately within a period of sixty (60)
                           days  thereafter  and whether or not on  condition or
                           the  happening  of any  contingency,  (other than (a)
                           customary  agreements  with and between  underwriters
                           and banking  group and  selling  group  members  with
                           respect to the distribution to the public or pursuant
                           to a private placement of securities, or (b) pursuant
                           to a pledge of securities  in the ordinary  course of
                           business); and

                  (iii)    any securities  which are  Beneficially  Owned within
                           the  meaning of clauses (a) or (b) above by any other
                           Person with which such Person is Acting Jointly or in
                           Concert,

                  provided,  however,  that a Person  shall  not be  deemed  the
                  "Beneficial Owner" or to have "Beneficial  Ownership" of or to
                  "Beneficially  Own" any  security  where  such  Person  is the
                  registered holder of securities as a result of carrying on the
                  business of or acting as nominee for a securities depository.

                  For purposes of this  Restated  Agreement,  the  percentage of
                  Common Shares  Beneficially Owned by any Person,  shall be and
                  be deemed to be the product determined by the formula:

                  100 x A/B

                  Where:

                  A =      the number of votes for the election of all directors
                           generally attaching to the Common Shares Beneficially
                           Owned by such Person; and

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                  B =      the number of votes for the election of all directors
                           generally attaching to all outstanding Common Shares.

                  For the  purposes  of the  foregoing  formula,  where a Person
                  Beneficially Owns unissued Common Shares which may be acquired
                  pursuant to Convertible  Securities,  such Common Shares shall
                  be deemed to be outstanding for the purpose of calculating the
                  percentage of Common Shares  Beneficially Owned by such Person
                  in both  the  numerator  and  the  denominator,  but no  other
                  unissued  Common Shares which may be acquired  pursuant to any
                  other  outstanding   Convertible  Securities  shall,  for  the
                  purposes of that calculation, be deemed to be outstanding.

         (i)      "BOARD"  means the Board of  Directors of the  Corporation  as
                  constituted from time to time.

         (j)      "CBCA" means the CANADA BUSINESS  CORPORATIONS ACT, as amended
                  from time to time, and any successor legislation thereto.

         (k)      "CALCULATION DATE" has the meaning referred to in Section 11.5
                  of this Restated Agreement.

         (l)      "CHANGE OF CONTROL" means the occurrence of any of:

                  (i)      the purchase or  acquisition  of any Common Shares or
                           Convertible  Securities  by a Beneficial  Owner which
                           results in the Beneficial Owner owning, or exercising
                           control  or   direction   over,   Common   Shares  or
                           Convertible  Securities such that,  assuming only the
                           conversion  of  Convertible  Securities  Beneficially
                           Owned or over which control or direction is exercised
                           by the Beneficial  Owner,  the Beneficial Owner would
                           own, or exercise  control or direction  over,  Common
                           Shares   carrying   the   right  to  cast  more  than
                           thirty-five  percent (35%) of the votes  attaching to
                           all Common Shares; or

                  (ii)     the substantial  completion of: (i) the  liquidation,
                           dissolution or winding-up of the Corporation; or (ii)
                           the  sale,  lease  or  other  disposition  of  all or
                           substantially  all of the assets of the  Corporation;
                           or

                  (iii)    a situation in which  individuals who were members of
                           the Board immediately prior to:

                           (A)      a  meeting  of  the   shareholders   of  the
                                    Corporation  involving a contest  for, or an
                                    item of business  relating  to, the election
                                    of directors; or

                           (B)      an  amalgamation,   arrangement,  merger  or
                                    other  consolidation  or  combination of the
                                    Corporation with another Person,

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                           shall  not   constitute   a  majority  of  the  Board
                           following such election or transaction; or

                  (iv)     the  completion of any  transaction or the first of a
                           series of  transactions  which would have the same or
                           similar  effect  as  any  transaction  or  series  of
                           transactions  referred to in paragraphs  (i), (ii) or
                           (iii) above; or

                  (v)      a  determination  by the Board that, for the purposes
                           of this Restated  Agreement,  a Change of Control has
                           occurred or is imminent.

         (m)      "CHANGE   OF   CONTROL   OBLIGATIONS"   means  the   Company's
                  obligations to make the lump sum payments described in Section
                  8.1 of this Restated Agreement to the Executive.

         (n)      A "CHANGE OF CONTROL  OBLIGATIONS - DESIGNATED EVENT" shall be
                  deemed to have occurred if:

                  (i)      the Corporation fails to arrange for the extension or
                           replacement of a Letter of Credit in accordance  with
                           the terms of this Restated Agreement; or

                  (ii)     the   Executive's   employment   is   terminated   in
                           accordance  with  Section  5.1,  6.1 or  7.1 of  this
                           Restated Agreement.

         (o)      "COMMON SHARES" means the common shares of the Corporation.

         (p)      "CONVERTIBLE SECURITIES" means:

                  (i)      any right (contractual or otherwise and regardless of
                           whether such right constitutes a security) to acquire
                           Common Shares from the Corporation; or

                  (ii)     any security issued by the  Corporation  from time to
                           time  (other  than the rights  issued  pursuant  to a
                           shareholders'   rights   protection   plan,  if  any)
                           carrying any exercise, conversion or exchange right,

                  which is then  exercisable or  exercisable  within a period of
                  sixty  (60) days from that time  pursuant  to which the holder
                  thereof may acquire  Common Shares or other  securities  which
                  are convertible into or exercisable or exchangeable for Common
                  Shares (in each case,  whether such right is then  exercisable
                  or  exercisable  within a period of sixty  (60) days from that
                  time and whether or not on condition  or the  happening of any
                  contingency).

         (q)      "DATE  OF   TERMINATION"   means  the  date  upon   which  the
                  Executive's  employment is terminated pursuant to Section 4.1,
                  5.1,  6.1 or 7.1  of  this  Restated  Agreement.  For  greater
                  clarity, the Date of Termination means the date upon which the
                  Corporation  provides the Executive  with  written,  verbal or
                  other notice that the Executive's  employment has been or will
                  be terminated  pursuant to Section 4.1 or

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                  6.1 of this  Restated  Agreement  or the date  upon  which the
                  Executive   provides  the  Corporation   with  written  notice
                  terminating the Executive's employment pursuant to Section 4.1
                  or 5.1 or for Good Reason pursuant to Section 7.1.

         (r)      "DISABILITY"   means,  where  due  to  a  physical  or  mental
                  condition,  the Executive is rendered  totally and permanently
                  unable to perform  the  Executive's  duties for a  consecutive
                  period of two (2) years or more during which the Executive has
                  been in receipt  of long term  disability  insurance  benefits
                  from  the   insurance   carrier   normally   utilized  by  the
                  Corporation.

         (s)      "DISPUTE" has the meaning  referred to in Section 12.1 of this
                  Restated Agreement.

         (t)      "EFFECTIVE DATE" means the date upon which a Change of Control
                  occurs.

         (u)      "EMPLOYMENT  BENEFITS" means the employment  benefits to which
                  the  Executive is entitled by virtue of any  written,  oral or
                  implied  agreement with the  Corporation.  For the purposes of
                  this Restated Agreement,  "Employment Benefits" shall include,
                  but is not limited to, the following:

                  (i)      the Executive's  entitlement to any dental or general
                           medical care;

                  (ii)     the  Executive's  entitlement  to  receive  long term
                           disability   benefits  from  the  insurance   carrier
                           normally utilized by the Corporation;

                  (iii)    the Executive's entitlement to pension benefits under
                           the terms of any pension plan with the Corporation;

                  (iv)     the   Executive's   entitlement   to  a  monthly  car
                           allowance from the Corporation;

                  (v)      the Executive's  entitlement to  contributions by the
                           Corporation to the Corporation's savings plan;

                  (vi)     the  Executive's  entitlement  to  receive  from  the
                           Corporation  financial counseling services, at a cost
                           of  $3,500.00  per  year  (or  as  the  same  may  be
                           increased from time to time by the Corporation); and

                  (vii)    the  Executive's  entitlement  to  receive  from  the
                           Corporation   security  monitoring  services  at  the
                           Executive's personal residence.

         (v)      "EXECUTIVE  BENEFIT  PLAN"  has  the  meaning  referred  to in
                  Section 8.1(b) of this Restated Agreement.

         (w)      "EXECUTIVE  BENEFIT PLAN OBLIGATIONS"  means the Corporation's
                  outstanding  obligations  under the Executive  Benefit Plan to
                  the Executive.

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         (x)      An "EXECUTIVE  BENEFIT PLAN  OBLIGATIONS  - DESIGNATED  EVENT"
                  shall be deemed to have occurred if:

                  (i)      a Change of Control occurs;

                  (ii)     the  Corporation  makes an assignment for the benefit
                           of  creditors  or files a petition in  bankruptcy  or
                           becomes insolvent or bankrupt;

                  (iii)    a  receiver,  trustee  or  liquidator  of or for  the
                           Corporation is appointed and is not discharged within
                           a period of sixty days;

                  (iv)     the  net  worth  of  the  Corporation,  described  as
                           shareholder  equity  in  the  consolidated  financial
                           statements  of the  Corporation  as  disclosed in the
                           annual   and   quarterly    consolidated    financial
                           statements  of the  Corporation,  is less  than  $400
                           million;

                  (v)      the Corporation fails to arrange for the extension or
                           replacement of a Letter of Credit in accordance  with
                           the terms of this Restated Agreement;

                  (vi)     the Executive has provided  written  notification  to
                           the Trustee and to the  Corporation of the failure by
                           the  Corporation  to pay  any  amount  owed  to or in
                           respect of the Executive under the Executive  Benefit
                           Plan within thirty days of the due date  specified in
                           the Executive Benefit Plan (together with a statement
                           of the  amount  due and  owing)  either to the person
                           entitled  thereto  pursuant to the Executive  Benefit
                           Plan  or  to  the  Trust  in   accordance   with  the
                           provisions of Section 11.6(h); or

                  (vii)    at any time the  Board  adopts  a  resolution  to the
                           effect that, for purposes of this Restated Agreement,
                           an Executive  Benefit Plan  Obligations  - Designated
                           Event has occurred or is imminent.

         (y)      "GOOD REASON" means any of the following, unless the Executive
                  shall  have  given the  Executive's  express  written  consent
                  thereto:

                  (i)      INCONSISTENT  DUTIES. The assignment to the Executive
                           of  any  duties  inconsistent  with  the  Executive's
                           status as an executive  officer of the Corporation or
                           a material  alteration in the nature or status of the
                           Executive's  responsibilities  or duties or reporting
                           relationship  from those in effect  immediately prior
                           to a Change of Control;

                  (ii)     REDUCED SALARY. A reduction by the Corporation in the
                           Executive's  Annual  Base  Salary  in  effect  on the
                           Effective  Date  or as  the  same  may  be  increased
                           thereafter  from time to time or the  failure  by the
                           Corporation to grant the Executive  salary  increases
                           at a rate commensurate with the increases accorded to
                           other executives of the Corporation;

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                  (iii)    RELOCATION.  The Corporation  requiring the Executive
                           to be based  anywhere  other than where the Executive
                           is  based at the time a  Change  of  Control  occurs,
                           except  for  required  travel  on  the  Corporation's
                           business to an extent  substantially  consistent with
                           the Executive's  business  travel  obligations in the
                           ordinary  course of business  immediately  prior to a
                           Change of Control;

                  (iv)     INCENTIVE  COMPENSATION  PLANS.  The  failure  by the
                           Corporation  to  continue  in  effect  any  incentive
                           compensation    plan   in   which    the    Executive
                           participates,  including,  but not  limited  to,  the
                           Incentive  Compensation Plan or the Stock Option Plan
                           or any other  similar plans adopted prior to a Change
                           of  Control,  unless the  Executive  is  eligible  to
                           participate in, and is entitled to the opportunity to
                           receive a  comparable  level of  benefits  under,  an
                           ongoing,  substitute  or  alternative  plan (it being
                           understood  that the manner or method of payment  and
                           the  form of  consideration  need  not be the same as
                           existed in the original plans); or the failure by the
                           Corporation to continue the Executive's participation
                           therein on at least as  favourable  a basis,  both in
                           terms of the  amount  of  benefits  available  to the
                           Executive   and   the   level   of  the   Executive's
                           participation  relative  to  other  participants,  as
                           existed at the time a Change of Control occurs;

                  (v)      EMPLOYMENT  BENEFITS AND PERQUISITES.  The failure by
                           the  Corporation to continue to provide the Executive
                           with  Employment  Benefits at least as  favourable as
                           those enjoyed by the Executive immediately prior to a
                           Change  of  Control,   including  any  pension  plan,
                           benefit   plan   or   any   retirement    arrangement
                           established   for  the  Executive,   or  any  of  the
                           Corporation's  life  insurance,  medical,  health and
                           accident,  disability  or savings  plans in which the
                           Executive was  participating  at the time a Change of
                           Control  occurs;  the  taking  of any  action  by the
                           Corporation   that  would   directly  or   indirectly
                           materially  reduce any such  benefits  or deprive the
                           Executive of any material  perquisite  enjoyed by the
                           Executive  at the time a Change  of  Control  occurs,
                           including,  without  limitation  and  to  the  extent
                           applicable,  the use of a car, aircraft,  secretarial
                           services,   office   space,   telephones,    computer
                           facilities,    expense    reimbursement,    financial
                           counselling,  and  professional  fees and  club  dues
                           reimbursement;  or the failure by the  Corporation to
                           provide  the  Executive   with  the  number  of  paid
                           vacation  days to which the  Executive is entitled in
                           accordance  with the  Corporation's  normal  vacation
                           practice  in effect  at the time a Change of  Control
                           occurs;

                  (vi)     NO  ASSUMPTION  BY  SUCCESSOR.  The  failure  of  the
                           Corporation to obtain a satisfactory agreement from a
                           successor   to  assume  and  agree  to  perform  this
                           Restated Agreement. Alternatively, if the business or
                           undertaking in connection  with which the Executive's
                           services  are  principally  performed  is sold at any
                           time  after  a  Change  of  Control  occurs,  and the
                           Executive's  employment is  transferred  as a result,

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                           the  failure  or  refusal  of the  purchaser  of such
                           business or undertaking to provide the Executive with
                           the   same   or  a   comparable   position,   duties,
                           compensation and benefits, as described in paragraphs
                           (iv) and (v) above,  as provided to the  Executive by
                           the  Corporation  immediately  prior to a  Change  of
                           Control;

                  (vii)    DISPOSITION  OF  "ALL  OR  SUBSTANTIALLY   ALL".  The
                           disposition   by   the    Corporation   of   all   or
                           substantially  all of the assets of the  Corporation,
                           as  contemplated  herein,  notwithstanding  that  the
                           Executive's  services  were or were  not  principally
                           performed for such business.

         (z)      "HEARING" has the meaning  referred to in Section 12.7 of this
                  Restated Agreement.

         (aa)     "HEARING DATE" has the meaning  referred to in Section 12.7 of
                  this Restated Agreement.

         (bb)     "INCENTIVE  COMPENSATION  PLAN"  means any bonus or  incentive
                  compensation plan of the Corporation in which the Executive is
                  entitled  to  receive   benefits  in  the  month   immediately
                  preceding a Change of Control.

         (cc)     "JUST CAUSE" means:

                  (i)      the failure by the Executive to substantially perform
                           the Executive's  duties according to the terms of the
                           Executive's employment in existence immediately prior
                           to a Change  of  Control  after the  Corporation  has
                           given the Executive reasonable notice of such failure
                           and a reasonable opportunity to correct it; or

                  (ii)     where the  Executive  engages in any  criminal act or
                           dishonesty resulting or intended to result,  directly
                           or indirectly,  in the personal gain of the Executive
                           at the Corporation's expense.

         (dd)     "LETTER OF CREDIT" has the meaning referred to in Section 11.2
                  of this Restated Agreement.

         (ee)     "MONTHLY BASE SALARY" means the monthly  salary payable to the
                  Executive by the Corporation in effect at the end of the month
                  immediately preceding the Effective Date.

         (ff)     "NOTICE OF  DISPUTE"  has the  meaning  referred to in Section
                  12.1 of this Restated Agreement.

         (gg)     "OBLIGATIONS"  means,  collectively,  the  Change  of  Control
                  Obligations and the Executive Benefit Plan Obligations.

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         (hh)     "PARTIES"  means  the  Corporation,  and  its  successors  and
                  permitted  assigns,  and the  Executive  and  the  Executive's
                  heirs,  executors and  administrators and "PARTY" means either
                  one of them.

         (ii)     "PERSON"  includes an  individual,  partnership,  association,
                  body  corporate,  trustee,  executor,   administrator,   legal
                  representative   and  any  national,   provincial,   state  or
                  municipal government or any agency thereof.

         (jj)     "REFUNDABLE  TAX  ACCOUNT"  means the  refundable  tax account
                  maintained  in  respect  of the  Trust by the  Canada  Revenue
                  Agency.

         (kk)     "REGISTERED  PENSION  PLAN"  has the  meaning  referred  to in
                  Section 8.1(b) of this Restated Agreement.

         (ll)     "RESTATED AGREEMENT" means this amended and restated agreement
                  respecting  change  of  control  and  executive  benefit  plan
                  entitlements  as it may be amended,  restated or  supplemented
                  from time to time,  and the  expressions  "hereof",  "herein",
                  "hereto", "hereunder", "hereby", and similar expressions refer
                  to this Restated  Agreement and, unless  otherwise  indicated,
                  refer to Articles or Sections in this Restated Agreement only.

         (mm)     "SECURITIZATION  PROCEDURE" has the meaning referred to in the
                  recitals of this Restated Agreement.

         (nn)     "SEVERANCE  PERIOD"  means the  thirty-six  (36) month  period
                  immediately following the Date of Termination.

         (oo)     "STOCK  OPTION  PLAN" means any stock  option plan or plans of
                  the  Corporation  pursuant to which the  Executive  is granted
                  options by the Corporation to acquire Common Shares.

         (pp)     "SUBSIDIARY" has the meaning ascribed to it in the CBCA.

         (qq)     "TAX  ACT"  means  the  Income  Tax  Act   (Canada)   and  the
                  Regulations thereunder, both as amended from time to time.

         (rr)     "TERM" has the  meaning  referred  to in  Section  3.1 of this
                  Restated Agreement.

         (ss)     "TRUST"  has the meaning  referred to in Section  11.1 of this
                  Restated Agreement.

         (tt)     "TRUST  AGREEMENT" has the meaning referred to in Section 11.1
                  of this Restated Agreement.

         (uu)     "TRUSTEE"  means CIBC Mellon Trust Company or such other trust
                  company  duly  incorporated  under  the laws of  Canada or any
                  province thereof whom the Company may designate as the trustee
                  in   connection   with  the   security   and  funding  of  the
                  Obligations.

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         (vv)     "VALUATION  DATE" has the meaning  referred to in Section 11.3
                  of this Restated Agreement.


                                   ARTICLE 2
                           SCOPE OF RESTATED AGREEMENT
                           ---------------------------

2.1      The Parties  intend  that this  Restated  Agreement  sets out (a) their
         respective  rights and  obligations  upon the occurrence of a Change of
         Control and in connection  with the  securitization  and funding of the
         Change of  Control  Obligations;  and (b) their  respective  rights and
         obligations  regarding the  securitization and funding of the Executive
         Benefit Plan Obligations.  This Restated Agreement does not provide for
         any other terms of the  Executive's  employment  with the  Corporation,
         except as expressly provided for herein.

2.2      The Parties hereby confirm that except as otherwise expressly stated in
         this Restated  Agreement,  insofar as the securitization and funding of
         the Executive Benefit Plan Obligations is concerned,  the terms of this
         Restated  Agreement  shall  govern and the terms of the  Securitization
         Procedure shall not be applicable.

2.3      This Restated Agreement shall automatically terminate upon the death of
         the  Executive or where due to the  Disability  of the  Executive,  the
         Executive is materially  incapacitated  from performing the Executive's
         duties.  In the event of the death or Disability of the Executive,  the
         Executive (or the Executive's estate) shall be entitled to receive from
         the  Corporation  all unpaid Annual Base Salary,  Employment  Benefits,
         unpaid business expenses and vacation  entitlement  accrued to the date
         of the death or  Disability  of the  Executive.  The  Executive (or the
         Executive's estate) shall also be entitled to receive any and all death
         or Disability  benefits in a manner consistent with, and at least equal
         in amount to, those provided by the  Corporation  to senior  executives
         (or their estate) under such plans,  programs and policies in effect at
         the date of Disability or death of the Executive,  and the  Corporation
         shall have no further  obligations to the Executive or the  Executive's
         estate under this Restated Agreement. Any entitlements of the Executive
         (or the  Executive's  estate)  under the  Executive  Benefit Plan which
         remain following the termination of this Restated Agreement pursuant to
         this  Section  2.3  shall  then   commence  to  be  covered  under  the
         Securitization Procedure.

2.4      If the  Executive's  employment is terminated by either Party,  for any
         reason,  prior  to a  Change  of  Control  in any  manner,  other  than
         expressly  provided  for in  this  Restated  Agreement,  this  Restated
         Agreement shall automatically  terminate and the Corporation shall have
         no  further  obligations  to the  Executive  hereunder.  Any  remaining
         entitlements  of the Executive  under the Executive  Benefit Plan which
         remain following the termination of this Restated Agreement pursuant to
         this  Section  2.4  shall  then   commence  to  be  covered  under  the
         Securitization Procedure.

<PAGE>
                                      -12-


                                   ARTICLE 3
                           TERM OF RESTATED AGREEMENT
                           --------------------------

3.1      Subject to termination of this Restated  Agreement prior to a Change of
         Control,  this Restated  Agreement  shall remain in effect for a period
         concluding  thirteen  (13) months  following  the  Effective  Date (the
         "Term"),  at  which  time  this  Restated  Agreement  shall  terminate;
         provided  however that the payment of compensation  and benefits to the
         Executive  under this Restated  Agreement shall continue beyond the end
         of the  Term in  accordance  with  the  applicable  provisions  of this
         Restated Agreement.  Any remaining  entitlements of the Executive under
         the Executive  Benefit Plan which remain  following the  termination of
         this  Restated  Agreement  pursuant  to this  Section  3.1  shall  then
         commence to be covered under the Securitization Procedure.


                                   ARTICLE 4
            TERMINATION FOR JUST CAUSE OR FOR OTHER THAN GOOD REASON
            --------------------------------------------------------

4.1      If the  Executive's  employment  is  terminated  for Just Cause,  or is
         terminated by the Executive, other than pursuant to Section 5.1 of this
         Restated Agreement or for other than Good Reason, following a Change of
         Control,  the  Corporation  shall pay to the Executive,  if not already
         paid,  the fraction of the unpaid Annual Base Salary accrued during the
         then current  fiscal year of the  Corporation,  all accrued  Employment
         Benefits,  all  unpaid  reasonable  business  expenses  and all  unpaid
         vacation pay accrued up to and including the Date of  Termination,  and
         thereafter,  the Corporation  shall have no further  obligations to the
         Executive under this Restated Agreement.

4.2      Nothing in this  Restated  Agreement  shall serve to derogate  from the
         vested rights of the Executive to pension benefits,  Stock Option Plans
         or any other Employment  Benefits to which the Executive is entitled up
         to the Date of Termination.


                                   ARTICLE 5
                              VOLUNTARY TERMINATION
                              ---------------------

5.1      In the event of a Change  of  Control,  the  Executive  shall  have the
         unfettered  right,  within thirty (30) days after the twelve (12) month
         period   following  the  Effective   Date,  to  elect  to  provide  the
         Corporation with written notice terminating his employment.  Upon being
         provided  such  written  notice,  the  Corporation  shall  pay  to  the
         Executive  the  remuneration  referred to in Article 8 of this Restated
         Agreement.

5.2      Notwithstanding  Section  5.1 of this  Restated  Agreement,  and in the
         event that a Change of Control  occurs as a result of a hostile bid for
         the takeover of the Corporation,  there shall be no requirement for the
         Executive  to wait for the  expiry  of the  twelve  (12)  month  period
         following the Effective  Date of a Change of Control,  in order for the
         Executive  to  exercise  the right  granted to provide  written  notice
         terminating  his  employment.

<PAGE>
                                      -13-


         In the circumstances of a hostile bid resulting in a Change of Control,
         the Executive shall have the unfettered right, within 30 days following
         the  Effective  Date of a Change of  Control,  to elect to provide  the
         Corporation  with  written  notice  terminating  his  employment.  Upon
         providing such written notice to the Corporation, the Corporation shall
         pay to the Executive the remuneration  referred to in Article 8 of this
         Restated  Agreement.  For the purposes of this  section,  "hostile bid"
         means a take-over  bid,  exchange offer or tender offer to acquire more
         than 35% of the Common  Shares which has not been approved by the Board
         of Directors prior to its public announcement or commencement.

5.3      Any  reference to Section 5.1 of this  Restated  Agreement,  within the
         body of the Change of Control  Agreement,  shall be deemed to include a
         reference to Section 5.2 of this Restated  Agreement (with such Section
         references to be used interchangeably).


                                   ARTICLE 6
                           TERMINATION BY CORPORATION
                           --------------------------

6.1      If the Executive's  employment is terminated by the Corporation  within
         the thirteen (13) month period following the Effective Date, for reason
         other than Just Cause,  death or Disability,  the Corporation shall pay
         to the  Executive  the  remuneration  referred  to in Article 8 of this
         Restated Agreement.


                                   ARTICLE 7
                           TERMINATION FOR GOOD REASON
                           ---------------------------

7.1      In the event of a Change of  Control,  the  Executive  may,  within the
         twelve  (12)  month  period  following  the  Effective  Date  and  upon
         providing the Corporation with ten (10) days written notice,  terminate
         the Executive's  employment with the Corporation for Good Reason.  Upon
         being  provided  with such  notice,  the  Corporation  shall pay to the
         Executive  the  remuneration  referred to in Article 8 of this Restated
         Agreement.


                                   ARTICLE 8
                          COMPENSATION UPON TERMINATION
                          -----------------------------

8.1      If the Executive's  employment is terminated in accordance with Section
         5.1, 6.1 or 7.1 of this Restated Agreement:

         (a)      the Corporation  shall forthwith,  but in any event within ten
                  (10)  days  from  receipt  by  the  Corporation  of a  Release
                  executed  by  the  Executive  substantially  in  the  form  of
                  Schedule "A", pay to the Executive:

                  (i)      if  not   previously   paid,   that  portion  of  the
                           Executive's  accrued but unpaid  Monthly Base Salary,
                           any accrued but unpaid  bonus to which the  Executive
                           is entitled for the preceding calendar year under any
                           Incentive  Compensation  Plan, all unpaid  reasonable
                           business expenses and all accrued but unused vacation
                           pay  earned  or  payable  to  the  Executive  by  the
                           Corporation  for the period from the beginning of the
                           Corporation's  then current  fiscal  year,  up to and
                           including the Date of Termination;

<PAGE>
                                      -14-


                  (ii)     a lump sum  cash  payment  equal  to the  Executive's
                           Monthly  Base  Salary and  one-twelfth  (1/12) of the
                           Executive's Annual Target Bonus for each month of the
                           Severance Period;

                  (iii)    a lump sum payment equal to thirteen percent (13%) of
                           the Executive's  Annual Base Salary for the Severance
                           Period representing the value of the group health and
                           welfare benefits for the Severance Period;

                  (iv)     a lump  sum  payment  representing  the  value of the
                           Executive's  monthly car  allowance for the Severance
                           Period;

                  (v)      a lump  sum  payment  representing  the  value of the
                           Corporation's   contributions  to  the  Corporation's
                           savings  plan (at a rate of six  percent  (6%) of the
                           Executive's  Annual Base  Salary)  for the  Severance
                           Period;

                  (vi)     a lump  sum  payment  representing  the  value of the
                           Executive's   entitlement   to   receive   from   the
                           Corporation  financial  counseling  services  for the
                           Severance Period; and

                  (vii)    a lump  sum  payment  representing  the  value of the
                           Executive's   entitlement   to   receive   from   the
                           Corporation   security  monitoring  services  at  the
                           Executive's  personal  residence  for  the  Severance
                           Period;

         (b)      with  respect  to  the  Executive's   entitlement  to  pension
                  benefits  under the Pension  Plan for  Employees of Nexen Inc.
                  (Defined Benefit Option) (the "Registered  Pension Plan"),  if
                  any, and the Executive's  related  entitlement under the Nexen
                  Inc. Restated  Executive Benefit Plan (the "Executive  Benefit
                  Plan"), if any:

                  (i)      the Corporation  shall recognize the Severance Period
                           for   purposes   of   determining   the   Executive's
                           entitlement;

                  (ii)     for calculation purposes, the Executive's entitlement
                           is the  benefit  which  would  have  been  determined
                           assuming   that  the   Executive  had  been  employed
                           throughout    the   Severance    Period,    including
                           recognition of:

                           (A)      additional  service  that  would  have  been
                                    credited for the Severance Period;

                           (B)      monthly  salary  equal  to  the  Executive's
                                    Monthly Base Salary throughout the Severance
                                    Period;

                           (C)      pensionable  bonus  for the year of the Date
                                    of Termination, and for each subsequent year
                                    or  portion  thereof  during  the  Severance
                                    Period,  determined  at  the  Annual  Target
                                    Bonus   level.   Average   bonus   will   be
                                    determined  over the three  years to the end
                                    of  the  Severance  Period,   including  any
                                    partial calendar years; and

<PAGE>
                                      -15-


                           (D)      the Executive shall be deemed to retire, and
                                    the pension to  commence,  upon the later of
                                    the  completion of the Severance  Period and
                                    the  attainment  of  age  fifty-five   (55),
                                    without  any  applicable   early  retirement
                                    reduction; and

                  (iii)    the pension  entitlements  described  in this Section
                           8.1(b) shall, to the extent legally  permissible,  be
                           provided through the Registered  Pension Plan. To the
                           extent that it is not legally  permissible to provide
                           such  pension  entitlements  through  the  Registered
                           Pension  Plan,  the  Corporation  shall  pay  to  the
                           Executive  a  lump  sum  payment   representing   the
                           settlement value of the additional  Executive Benefit
                           Plan  benefit   determined  in  accordance  with  the
                           assumptions set forth in Schedule "B-1";

                  (iv)     any entitlements of the Executive under the Executive
                           Benefit  Plan which have  previously  been  funded in
                           accordance with Article 11 but not previously settled
                           in accordance with Article 11 shall be settled by the
                           Corporation in accordance  with the  assumptions  set
                           forth in Schedule "B-1";

         (c)      the  Corporation  shall provide the Executive  with  executive
                  outplacement  counselling  to  be  provided  by a  firm  to be
                  selected by the Executive, at a cost to the Corporation not to
                  exceed $25,000.00;

         (d)      all of the Executive's outstanding unexercisable stock options
                  under any Stock Option Plan shall become exercisable; and

         (e)      where the Executive has been relocated,  at the request of the
                  Corporation,  within the two (2) year period immediately prior
                  to the Effective  Date, if so requested by the Executive,  the
                  Corporation   shall   relocate  the  Executive   back  to  the
                  Executive's prior location.

8.2      The  estimated  value as of April 1,  2008 of  Sections  8.l(a)(ii)  to
         8.1(c) are set out in Schedule  "C".  Schedule "C"  provides  estimated
         values only and actual values shall be  calculated  in accordance  with
         this  Restated  Agreement at the time of  entitlement  or payment under
         this Restated Agreement.

8.3      If the  Executive's  employment  is  terminated  in  the  circumstances
         described in Section 5.1, 6.1 or 7.1 of this  Restated  Agreement,  the
         remuneration  and  benefits  payable  under this Article 8 shall not be
         reduced if the Executive obtains alternative employment.

8.4      Unless expressly  provided  otherwise in this Restated  Agreement,  all
         payments  to be made to the  Executive  under  this  Article 8 shall be
         subject to required statutory deductions at source by the Corporation.

<PAGE>
                                      -16-


                                   ARTICLE 9
                            CONFIDENTIAL INFORMATION
                            ------------------------

9.1      If the  Executive's  employment is terminated in any manner  whatsoever
         due to or following a Change of Control,  the Executive  agrees to keep
         confidential  all information of a confidential  or proprietary  nature
         concerning the Corporation, its Affiliates, Associates and Subsidiaries
         and their respective operations,  opportunities, areas of present, past
         or  future  interests,  assets,  finances,   technology,   intellectual
         property,  business  and  affairs,  and further  agrees not to use such
         information,  data or technology for personal advantage,  provided that
         nothing  herein shall prevent the  disclosure of  information  which is
         publicly  available  or  which  is  required  to be  disclosed  by  the
         Executive under appropriate statute, rules of law or legal process.


                                   ARTICLE 10
              RIGHTS AND OBLIGATIONS OF EXECUTIVE UPON TERMINATION
              ----------------------------------------------------

10.1     Subject to Section 9.1 of this Restated Agreement,  the Executive shall
         not be prohibited in any manner  whatsoever from obtaining  alternative
         employment  with or otherwise  forming or  participating  in a business
         competitive to the business of the Corporation after the termination of
         the Executive's employment with the Corporation.

10.2     Upon the termination of the Executive's  employment for any reason, the
         Executive  shall tender the Executive's  resignation  from any position
         the Executive may hold as an officer or director of the  Corporation or
         any of its Affiliates, Associates or Subsidiaries.

10.3     If the  Executive's  employment  is  terminated  in  the  circumstances
         described in Section 5.1, 6.1 or 7.1 of this  Restated  Agreement,  the
         Corporation  shall  continue to purchase  and  maintain,  to the extent
         available in the marketplace at reasonable cost to the Corporation,  on
         behalf of the Executive,  director and officer liability  insurance for
         the  applicable  limitation  period  following  the date upon which the
         Executive  ceases to serve as a director or officer of the Corporation,
         and the Executive's  existing  agreement to receive  indemnity from the
         Corporation for acts taken by the Executive in the Executive's capacity
         as an officer of the Corporation shall remain in effect.

10.4     Upon termination of the Executive's employment pursuant to Section 5.1,
         6.1 or 7.1 of this Restated Agreement,  the Corporation shall reimburse
         the  Executive  for  ongoing  legal  fees and  disbursements  which the
         Executive  may  reasonably  incur  in  connection  with  this  Restated
         Agreement (but this Restated Agreement only),  including any litigation
         concerning the validity or  enforceability  of, or liability under, any
         provision of this  Restated  Agreement or any action by the  Executive.
         The Corporation shall pay such fees and reimbursements to the Executive
         promptly as such fees and disbursements become due.

<PAGE>
                                      -17-


                                   ARTICLE 11
                      SECURITIZATION AND FUNDING PROCEDURE
                      ------------------------------------

11.1     The  Corporation  has established and maintains a trust for the benefit
         of the  Executive  and  persons  claiming  through  him  (the  "Trust")
         pursuant to the terms and  conditions of a trust  agreement (the "Trust
         Agreement") between the Corporation and the Trustee. The Trust shall be
         funded in accordance with the provisions of this Restated Agreement and
         the Trust Agreement.

11.2     To provide security against a failure by the Corporation to either fund
         or settle the  Obligations in accordance with the terms of this Article
         11, the Trust Agreement  provides for the funding of the Trust with the
         proceeds  of an  irrevocable  letter  of  credit  which  satisfies  the
         requirements  of this Restated  Agreement (a "Letter of Credit") in the
         event  that  the  Corporation   does  not  provide  funding  or  effect
         settlement  when required to do so hereunder and in accordance with the
         terms  hereof.  The  Corporation  confirms  that the  Letter  of Credit
         currently  held by the  Trustee  has been  issued  by a major  Canadian
         chartered   bank  (the   "Bank")  in  an  amount   calculated   by  the
         Corporation's consulting actuary (who at all times shall be a Fellow of
         the Canadian Institute of Actuaries) (the "Actuary") in accordance with
         the provisions of Section 11.5 of this Restated Agreement.

11.3     On each February 1st (the  "Anniversary  Date"),  the Corporation shall
         request a report  from the Actuary as to the amount  calculated,  as at
         the next  succeeding  April 1st (the "Valuation  Date"),  in accordance
         with the  provisions  of Section 11.5 of this Restated  Agreement.  The
         Corporation  shall  provide  the  Actuary  with the data it requires to
         prepare  such  report.   Upon  completion  of  each  such  report,  the
         Corporation  shall arrange for the Actuary to provide a summary of same
         to the Trustee.

         Prior to the funding  and/or  settlement of all of the  Obligations  in
         accordance with the terms of this Restated  Agreement,  the Corporation
         shall, within forty-five days after the applicable Anniversary Date and
         in accordance with the terms of the report received from the Actuary:

         (a)      either:

                  (i)      arrange  for a Letter of Credit to be provided by the
                           Bank to the  Trustee to replace  the Letter of Credit
                           then held by the Trustee.  The replacement  Letter of
                           Credit shall be:

                           (A)      substantially  in the form of the  Letter of
                                    Credit then held by the Trustee;

                           (B)      in an amount calculated by the Actuary as at
                                    the applicable  Valuation Date in accordance
                                    with the  provisions of Section 11.5 of this
                                    Restated Agreement; and

<PAGE>
                                      -18-


                           (C)      for a term  which  commences  on the date of
                                    its issuance and expires one year  following
                                    the applicable Valuation Date; or

                  (ii)     confirm to the Trustee in writing  that the Letter of
                           Credit  then  held by the  Trustee  will be  extended
                           automatically   for  a  further  one-year  term.  The
                           confirmation  to the Trustee shall  include  evidence
                           from the Bank as to any  amendment to the  applicable
                           Letter of Credit, any such amendment to be consistent
                           with the  report  prepared  by the  Actuary as at the
                           applicable Valuation Date; and

         (b)      contribute  to the  Trust an  amount  equal  to twice  the fee
                  charged  by the Bank in  connection  with the Letter of Credit
                  extension or replacement, as applicable. The Corporation shall
                  withhold  one-half  of such  amount  and shall  remit the said
                  one-half  of such  amount  to the  Canada  Revenue  Agency  on
                  account of the tax which is  exigible  pursuant to the Tax Act
                  in connection with such contribution to the Trust. The Trustee
                  shall remit the remaining  one-half of such amount to the Bank
                  in  consideration  for  the  Letter  of  Credit  extension  or
                  replacement, as applicable.

         When a  replacement  Letter of Credit has been  provided in  accordance
         with the terms of this Section 11.3, an existing Letter of Credit shall
         be surrendered and cancelled.

11.4     If,  during  the term of a Letter of  Credit  issued  pursuant  to this
         Restated Agreement, the Corporation, acting reasonably,  concludes that
         there has been a significant  change in the Obligations  since the date
         of the last report prepared by the Actuary  pursuant to Section 11.3 of
         this Restated  Agreement,  the Corporation  shall request a report from
         the Actuary as to the then current value of the Obligations, calculated
         in  accordance  with the  provisions  of Section 11.5 of this  Restated
         Agreement.  Upon receipt of the report, the Corporation shall provide a
         summary of same to the Trustee and arrange,  together with the Trustee,
         for any  required  increase  or decrease in the amount of the Letter of
         Credit  for the  balance of the term of such  Letter of Credit.  In the
         event  that a  replacement  Letter  of  Credit  is to be  issued in the
         circumstances  described in this Section 11.4, the  Corporation and the
         Trustee  shall  arrange  for such  replacement  Letter  of Credit to be
         provided  by the Bank to the  Trustee to  replace  the Letter of Credit
         then held by the  Trustee.  Upon  receipt  of a  replacement  Letter of
         Credit  pursuant to this Section 11.4, the Trustee shall  surrender for
         cancellation  the  Letter of Credit  then held by it  pursuant  to this
         Restated Agreement and the Trust Agreement.

         In the event that all or any portion of the fee  referred to in Section
         11.3 of this Restated Agreement, is refunded by the Bank as a result of
         a decrease in the amount of a Letter of Credit pursuant to this Section
         11.4, such amount (together with any resulting refundable Tax) shall be
         received by the Trustee  for deposit to the Trust.  Upon  receipt of an
         Authorized Instruction (as defined in the Trust Agreement), the Trustee
         shall pay and transfer such amounts (less any  applicable  tax which it
         will remit as required by the Tax Act on behalf of the  Corporation) to
         the Corporation for its sole and exclusive use and benefit.

<PAGE>
                                      -19-


         In the event that an additional  fee is required to be paid to the Bank
         as a result of an increase in the amount of a Letter of Credit pursuant
         to this Section 11.4, the Corporation  shall contribute to the Trust an
         amount  equal  to twice  the  additional  fee.  The  Corporation  shall
         withhold  one-half of such amount and shall remit the said  one-half of
         such amount to the Canada Revenue Agency on account of the tax which is
         exigible  pursuant to the Tax Act in connection with such  contribution
         to the Trust.  The Trustee shall remit the  remaining  one-half of such
         amount to the Bank in payment of its additional fee.

11.5     A Letter of Credit issued pursuant to this Restated Agreement shall:

                  (i)      be an irrevocable standby letter of credit;

                  (ii)     obligate the Bank to satisfy  demand for payment made
                           by the Trustee in  accordance  with the terms of this
                           Restated Agreement and the Trust Agreement;

                  (iii)    permit partial drawings; and

                  (iv)     provide  that the Bank must  notify the Trustee on or
                           before thirty days prior to the expiry of a Letter of
                           Credit of any notice of non-extension provided by the
                           Bank to the Corporation.

         The amount of a Letter of Credit  pursuant to this  Restated  Agreement
         shall be  calculated  by the Actuary in  accordance  with the following
         subparagraphs of this Section 11.5.

         (a)      Assuming the lump sum payments  referred to in Section  8.1(a)
                  of this  Restated  Agreement  are equal to the amount  thereof
                  provided by the Corporation.

         (b)      Assuming  the  service of the  Executive  will  terminate,  in
                  accordance  with  Section  5.1,  6.1, or 7.1 of this  Restated
                  Agreement,  on  the  next  succeeding  March  31st  after  the
                  Valuation Date (the "Calculation Date").

         (c)      Using the Executive's demographic data, including base salary,
                  target bonus and current  marital  status as of the  Valuation
                  Date, provided by the Corporation.

         (d)      Using the Yearly Maximum Pensionable  Earnings (Y.M.P.E.) used
                  to determine the amount of the Canada Pension Plan Benefit and
                  Tax Act maximum defined benefit pension dollar limit as at the
                  Valuation Date.

         (e)      Assuming all Obligations are included.

         (f)      Using  the  actuarial  methods,  assumptions  and  calculation
                  methodology described in Schedule "B-2.

         (g)      Applying a load of 15% to the amount  determined in accordance
                  with  subparagraphs  (b) through (f) of this  Section  11.5 to
                  provide  for  fluctuations  in  the  Interest  Discount  Rate,

<PAGE>
                                      -20-


                  Consumer Price Index and other plan experience during the term
                  of the Letter of Credit, as described in Schedule "B-2".

         (h)      Applying  a load  to  one-half  of the  amount  determined  in
                  accordance with  subparagraphs (a) through (g) of this Section
                  11.5 to provide for the cost  associated  with the  borrowings
                  described  in  subparagraph  (k)  of  this  Section  11.5,  as
                  described in Schedule "B-2".

         (i)      Including a  settlement  expense to the amount  determined  in
                  subparagraph  (h),  with  the  aggregate   settlement  expense
                  allowance for all  obligations  secured equal to $250,000,  or
                  where the  Valuation  Date is after  December  31,  2008,  the
                  aggregate  settlement  expense  allowance will be increased at
                  the rate equal to the increase in the Consumer Price Index, as
                  described in Schedule "B-2", plus 1% for each year after 2008.

         (j)      Assuming  the  Obligations  will be promptly  settled with the
                  Executive upon  occurrence of a Designated  Event described in
                  Section 1.1(n)(ii).

         (k)      Assuming a loan will be secured  to permit  settlement  of the
                  Obligations  prior to receipt of the  Refundable  Tax  Account
                  from the Canada  Revenue  Agency.  The assumed  interest  rate
                  payable on the loan shall be as described  in Schedule  "B-2".
                  The cost associated with the borrowings shall be assumed to be
                  paid from the Trust.

         (l)      The liabilities  calculated in accordance  with  subparagraphs
                  (a) through (k) above shall be offset by:

                  (i)      the Refundable Tax Account, if any; and

                  (ii)     the assets contained in the Trust, if any.

11.6     (a)      If an Executive  Benefit Plan  Obligations - Designated  Event
                  shall occur, the Corporation  shall be required to immediately
                  fund the Executive Benefit Plan Obligations in accordance with
                  the most recent  report  prepared  by the Actuary  pursuant to
                  Section 11.3 of this Restated  Agreement.  Notwithstanding the
                  foregoing,   if  an  Executive   Benefit  Plan  Obligations  -
                  Designated  Event described in Section  1.1(x)(i) and a Change
                  of Control Obligations - Designated Event described in Section
                  1.1(n)(ii) shall occur  simultaneously,  the Corporation shall
                  be required to settle the Executive  Benefit Plan  Obligations
                  forthwith in accordance with the provisions of Schedule "B-1".

         (b)      If:

                  (i)      the  employment of the Executive is terminated by the
                           Corporation  for any reason other than as a result of
                           the  death,   disability   or   retirement   of  such
                           Executive; and

<PAGE>
                                      -21-


                  (ii)     such Executive  files with the  Corporation a written
                           request  that  it fund  the  Executive  Benefit  Plan
                           Obligations,

                  the  Corporation  shall be  required to  immediately  fund the
                  Executive Benefit Plan Obligations in accordance with the most
                  recent report prepared by the Actuary pursuant to Section 11.3
                  of this Restated Agreement.

         (c)      Upon the earlier of:

                  (i)      learning of the  occurrence  of an Executive  Benefit
                           Plan  Obligations  -  Designated  Event  described in
                           Section 1.1(x)(v) or (vi) of this Restated Agreement;
                           or

                  (ii)     receipt of a written  notice of the  occurrence of an
                           Executive Benefit Plan Obligations - Designated Event
                           described  in  any  of  the  other  subparagraphs  of
                           Section  1.1(x)  of this  Restated  Agreement,  which
                           notice  has  been  signed  by two  executives  of the
                           Corporation,  one of whom  must be  either  the Chief
                           Financial  Officer  or  the  General  Counsel  of the
                           Corporation  and which notice must, in the case of an
                           Executive Benefit Plan Obligations - Designated Event
                           described  in  Section  1.1(x)(i)  of  this  Restated
                           Agreement,   indicate  which   subparagraph   of  the
                           definition of "Change of Control" is applicable,

                  the Trustee shall  promptly give notice to the  Corporation in
                  writing  that it intends to draw on that portion of the Letter
                  of Credit  which is referable  to the  Executive  Benefit Plan
                  Obligations  and  contribute  the proceeds  thereof  (less any
                  applicable  withholding tax which it will remit as required by
                  the Tax Act on  behalf  of the  Corporation)  to the  Trust on
                  behalf  of the  Corporation  in order  to fund  the  Executive
                  Benefit  Plan  Obligations,  unless it  receives  satisfactory
                  proof within nine days of such notice that the Corporation has
                  funded or settled,  as applicable,  the Executive Benefit Plan
                  Obligations  itself  in  accordance  with  the  terms  of this
                  Restated Agreement.

                  Unless the Corporation  advises the Trustee in writing that it
                  has funded or settled,  as applicable,  the Executive  Benefit
                  Plan Obligations in accordance with the terms of this Restated
                  Agreement and has provided the Trustee with satisfactory proof
                  thereof  within  nine  days of the date of the  aforementioned
                  notice,  the Trustee  shall draw on that portion of the Letter
                  of Credit  which is referable  to the  Executive  Benefit Plan
                  Obligations on the tenth day following the date of such notice
                  (or the next following business day if such tenth day is not a
                  business day) and  contribute  the proceeds  thereof (less any
                  applicable  withholding tax which it will remit as required by
                  the Tax Act on  behalf  of the  Corporation)  to the  Trust on
                  behalf of the Corporation.

                  Notwithstanding  the  foregoing,  in the  event  an  Executive
                  Benefit  Plan  Obligations  -  Designated  Event  described in
                  Section  1.1(x)(v)  or  (vi) of this  Restated  Agreement  has

<PAGE>
                                      -22-


                  triggered  the  operation of this Section 11.6 and the failure
                  which gave rise to the  occurrence of such  Executive  Benefit
                  Plan Obligations - Designated Event has been remedied prior to
                  the  expiration  of the  notice  period  provided  for in this
                  Section  11.6(c),  the  Trustee  shall  not  take  the  action
                  described in the immediately  preceding  paragraph  hereof and
                  all  of  the  provisions  of  this  Restated  Agreement  shall
                  continue  to  apply to the  same  extent  and as fully as they
                  would  have in the event  that  such  Executive  Benefit  Plan
                  Obligations - Designated Event had not occurred.

         (d)      Upon  receipt  of a written  notice of the  occurrence  of the
                  events described in both subparagraphs (i) and (ii) of Section
                  11.6(b)  of this  Restated  Agreement  (which  notice has been
                  signed by the Executive and sworn before a notary public), the
                  Trustee  shall  promptly  give  notice to the  Corporation  in
                  writing  that it intends to draw on that portion of the Letter
                  of Credit  which is referable  to the  Executive  Benefit Plan
                  Obligations  and  contribute the proceeds (less any applicable
                  withholding tax which it will remit as required by the Tax Act
                  on  behalf of the  Corporation)  to the Trust on behalf of the
                  Corporation  in  order  to fund  the  Executive  Benefit  Plan
                  Obligations unless it receives  satisfactory proof within nine
                  days of the  date of such  notice  that  the  Corporation  has
                  funded  the  Executive  Benefit  Plan  Obligations  itself  in
                  accordance with the terms of this Restated Agreement.

                  Unless the Corporation  advises the Trustee in writing that it
                  has  funded  the  Executive   Benefit  Plan   Obligations   in
                  accordance  with the terms hereof and has provided the Trustee
                  with  satisfactory  proof thereof within nine days of the date
                  of the aforementioned notice, the Trustee shall draw upon that
                  portion  of the  Letter of Credit  which is  referable  to the
                  Executive  Benefit Plan Obligations on the tenth day following
                  the date of such notice (or the next following business day if
                  such  tenth  day is not a  business  day) and  contribute  the
                  proceeds  (less any applicable  withholding  tax which it will
                  remit as required by the Tax Act on behalf of the Corporation)
                  to the Trust on behalf of the Corporation.

         (e)      For purposes of determining  the required amount of funding or
                  the  portion  of the  Letter  of  Credit  to be  drawn  on for
                  purposes of this Section 11.6,  the Trustee shall refer to the
                  most recent  report  prepared  by the Actuary for  purposes of
                  this Restated Agreement and, in particular,  to the portion of
                  the  report   dealing   with  the   Executive   Benefit   Plan
                  Obligations. In preparing the portion of its report respecting
                  Executive Benefit Plan  Obligations,  the Actuary shall adhere
                  to the following:

                  (i)      Assuming  that  the  Executive,  if  then  in  active
                           employment, will remain in active employment with the
                           Corporation as an officer until the Calculation  Date
                           and  that  the   Executive's   employment   with  the
                           Corporation will terminate on the Calculation Date.

<PAGE>
                                      -23-


                  (ii)     Using the  Executive's  demographic  data,  including
                           base salary,  actual bonus history,  target bonus and
                           current  marital  status  as of the  Valuation  Date,
                           provided by the Corporation.

                  (iii)    Using the Canada  Pension  Plan  Benefit  and Tax Act
                           maximum  defined  benefit  pension dollar limit as at
                           the Valuation Date.

                  (iv)     Assuming  the  Executive's  target  bonus  percentage
                           remains  at the level  specified  by the  Corporation
                           pursuant to subparagraph (ii) above.

                  (v)      Assuming only Executive  Benefit Plan Obligations are
                           included.

                  (vi)     Assuming the  payments  under the  Executive  Benefit
                           Plan would be made from the Trust.

                  (vii)    Using  the   actuarial   methods,   assumptions   and
                           calculation methodology described in Schedule "B-2.

                  (viii)   Applying  loads as described in Schedule "B-2" to the
                           amount  determined in  accordance  with the preceding
                           subparagraphs  of this Section 11.6(e) to provide for
                           future contingencies and expenses of the Trust.

                  (ix)     Calculating  the estimated  amount required to settle
                           the Executive  Benefit Plan Obligations  based on the
                           actuarial   methods,   assumptions   and  calculation
                           methodology described in Schedule "B-2", increased by
                           the loads described in the following subparagraph.

                  (x)      Applying  loads as described in Schedule "B-2" to the
                           amount  determined  in accordance  with  subparagraph
                           (ix) to provide for:

                           (A)      fluctuations  in the Interest  Discount Rate
                                    and Consumer  Price Index during the term of
                                    the Letter of Credit; and

                           (B)      the  cost  associated  with  the  loan to be
                                    secured as allowed under the Trust Agreement
                                    to  permit   settlement   of  the  Executive
                                    Benefit Plan Obligations prior to receipt of
                                    the  Refundable  Tax Account from the Canada
                                    Revenue  Agency.  The assumed  interest rate
                                    payable on the loan shall be as described in
                                    Schedule  "B-2"  and  shall  be  applied  to
                                    one-half of the amount in subparagraph (ix).
                                    The  cost  associated  with  the  borrowings
                                    shall be assumed to be paid from the Trust.

                  (xi)     Taking the larger amount for the Executive of:

                           (A)      the amount  determined  in  accordance  with
                                    subparagraphs (i) through (viii), and

<PAGE>
                                      -24-


                           (B)      the amount  determined  in  accordance  with
                                    subparagraphs (ix) and (x).

                  (xii)    The amount determined in accordance with subparagraph
                           (xi) above shall be offset by:

                           (A)      the Refundable Tax Account, if any;

                           (B)      the assets contained in the Trust, if any.

         (f)      In the event that the Executive  Benefit Plan Obligations have
                  been funded in  accordance  with the terms  hereof as a result
                  of:

                  (i)      the Corporation  making an assignment for the benefit
                           of  creditors or filing a petition in  bankruptcy  or
                           becoming insolvent or bankrupt;

                  (ii)     a  receiver,  trustee  or  liquidator  of or for  the
                           Corporation  being appointed and not being discharged
                           within a period of sixty days;

                  (iii)    a   voluntary   dissolution   or   wind-up   of   the
                           Corporation; or

                  (iv)     a sale or disposition of all or substantially  all of
                           the assets of the Corporation,

                  and  the  Executive   Benefit  Plan  has  been  terminated  in
                  connection  therewith,  the Executive Benefit Plan Obligations
                  shall be promptly settled by the Trustee with the Executive by
                  way of a lump sum payment  from the Trust.  For this  purpose,
                  the benefit entitlements of each Executive shall be determined
                  by the Actuary in  accordance  with the terms of the Executive
                  Benefit  Plan and the amount of the lump sum payment  shall be
                  determined by the Actuary using the  assumptions  set forth in
                  Schedule "B-1". Notice of termination of the Executive Benefit
                  Plan shall be  provided  to the  Trustee  by the  Corporation,
                  failing  which by two  executives of the  Corporation,  one of
                  whom must be either the Chief Financial Officer or the General
                  Counsel of the Corporation.

                  Any assets of the Trust remaining  after full  satisfaction of
                  (i) the  Executive  Benefit Plan  Obligations  pursuant to the
                  preceding paragraph and (ii) any further obligations  pursuant
                  to the terms of the Trust Agreement,  shall be returned to the
                  Corporation.

         (g)      In the event the Executive Benefit Plan shall be terminated at
                  any  time  either  in  whole  or in  part in  relation  to the
                  Executive  subsequent to the funding of the Executive  Benefit
                  Plan  Obligations in accordance  with the terms hereof,  then,
                  provided  Section  11.6(f) of this  Restated  Agreement is not
                  otherwise  applicable,  the Executive Benefit Plan Obligations
                  shall be promptly settled by the Trustee with the Executive by
                  way of a lump sum payment from the Trust.

<PAGE>
                                      -25-


                  For this purpose,  the benefit  entitlements  of the Executive
                  shall be  determined  by the  Actuary in  accordance  with the
                  terms of the Executive Benefit Plan and the amount of the lump
                  sum  payment  shall be  determined  by the  Actuary  using the
                  assumptions  set  forth  in  Schedule  "B-1".  Notice  of  the
                  termination of the Executive Benefit Plan shall be provided to
                  the  Trustee  by  the   Corporation,   failing  which  by  two
                  executives of the Corporation,  one of whom must be either the
                  Chief  Financial   Officer  or  the  General  Counsel  of  the
                  Corporation.

                  Any assets of the Trust remaining  after full  satisfaction of
                  (i) the  Executive  Benefit  Plan  Obligations  and  (ii)  any
                  further  obligations  pursuant  to  the  terms  of  the  Trust
                  Agreement, shall be returned to the Corporation.

         (h)      In the event:

                  (i)      of a dispute as to whether a payment to or in respect
                           of the Executive is properly due and payable pursuant
                           to the Executive Benefit Plan; and

                  (ii)     such  dispute  cannot  be  resolved  by  the  parties
                           thereto  within the time frame  specified  in Section
                           1.1(x)(vi) of this Restated Agreement,

                  the amount in dispute  shall be  remitted  to the  Trustee for
                  deposit to the Trust.  Upon final  settlement  of the dispute,
                  the amount so deposited  (together with any earnings,  profits
                  and increments  thereon and after  deduction of any authorized
                  payments allocable  thereto,  both as determined in accordance
                  with the terms of the Trust  Agreement),  less any  applicable
                  withholding  tax which will be remitted as required by the Tax
                  Act, shall be paid to that party to the dispute which is found
                  to be entitled thereto. Prior to such amount being paid out of
                  the Trust in accordance with the terms hereof, the Corporation
                  shall  instruct  the Actuary to take such amount into  account
                  when  preparing  its  report  for  purposes  of this  Restated
                  Agreement.

         (i)      In the event that a Change of Control Obligations - Designated
                  Event  described  in  Section   1.1(n)(ii)  of  this  Restated
                  Agreement  shall  occur  subsequent  to  the  funding  of  the
                  Executive  Benefit Plan  Obligations  in  accordance  with the
                  terms of this Restated  Agreement,  the  Corporation  shall be
                  required  to settle the  Executive  Benefit  Plan  Obligations
                  forthwith in an amount determined by the Actuary in accordance
                  with the provisions of Schedule "B-1".

         (j)      Subject  to  Section  11.6(f),  11.6(g)  and  11.6(i)  of this
                  Restated  Agreement,  in the event that the Executive  Benefit
                  Plan Obligations have been funded in accordance with the terms
                  hereof,  all or a  portion  of  such  Executive  Benefit  Plan
                  Obligations  may, at the  discretion  of the  Corporation,  be
                  promptly settled with the Executive.

                  For this purpose,  the benefit  entitlements  of the Executive
                  shall be  determined  by the  Actuary in  accordance  with the
                  terms of the Executive  Benefit  Plan. In such  circumstances,
                  the  Corporation  reserves  the right to settle the  Executive
                  Benefit Plan  Obligations  by way of a lump sum payment to the

<PAGE>
                                      -26-


                  Executive  provided  that the  amount of each such  payment is
                  determined by the Actuary in accordance  with the  assumptions
                  set forth in Schedule "B-1".

11.7     (a)      If  a  Change  of  Control   Obligations  -  Designated  Event
                  described  in Section  1.1(n)(i)  of this  Restated  Agreement
                  shall occur, the Corporation  shall be required to immediately
                  fund the Change of Control  Obligations in accordance with the
                  most recent report prepared by the Actuary pursuant to Section
                  11.3 of this Restated Agreement.

         (b)      If  a  Change  of  Control   Obligations  -  Designated  Event
                  described in Section  1.1(n)(ii)  of this  Restated  Agreement
                  shall occur,  the Corporation  shall be required to settle the
                  Change of Control Obligations forthwith in accordance with the
                  provisions of Schedule "B-1",  upon receipt by the Corporation
                  of a Release executed by the Executive in the form attached to
                  this Restated Agreement as Schedule "A".

         (c)      Upon the earlier of:

                  (i)      learning  of the  occurrence  of a Change of  Control
                           Obligations - Designated  Event  described in Section
                           1.1(n)(i) of this Restated Agreement; or

                  (ii)     receipt of a written  notice of the  occurrence  of a
                           Change of  Control  Obligations  -  Designated  Event
                           described  in  Section  1.1(n)(ii)  of this  Restated
                           Agreement,  which  notice  has  been  signed  by  the
                           Executive  and sworn  before a notary  public and has
                           annexed  thereto a Release  executed by the Executive
                           in the form  attached to this  Restated  Agreement as
                           Schedule "A",

                  the Trustee shall  promptly give notice to the  Corporation in
                  writing  that it intends to draw on that portion of the Letter
                  of  Credit  which  is  referable  to  the  Change  of  Control
                  Obligations  and  contribute  the proceeds  thereof  (less any
                  applicable  withholding tax which it will remit as required by
                  the Tax Act on  behalf  of the  Corporation)  to the  Trust on
                  behalf  of the  Corporation  in order to fund  the  Change  of
                  Control  Obligations,  unless it receives  satisfactory  proof
                  within  nine  days of such  notice  that the  Corporation  has
                  funded or  settled,  as  applicable,  the  Change  of  Control
                  Obligations  itself  in  accordance  with  the  terms  of this
                  Restated Agreement.

                  Unless the Corporation  advises the Trustee in writing that it
                  has funded or settled,  as  applicable,  the Change of Control
                  Obligations  in  accordance  with the  terms of this  Restated
                  Agreement and has provided the Trustee with satisfactory proof
                  thereof  within  nine  days of the date of the  aforementioned
                  notice,  the Trustee  shall draw on that portion of the Letter
                  of  Credit  which  is  referable  to  the  Change  of  Control
                  Obligations on the tenth day following the date of such notice
                  (or the next following business day if such tenth day is not a

<PAGE>
                                      -27-


                  business day) and contribute the proceeds (less any applicable
                  withholding tax which it will remit as required by the Tax Act
                  on  behalf of the  Corporation)  to the Trust on behalf of the
                  Corporation.

                  Notwithstanding  the  foregoing,  in the  event  a  Change  of
                  Control  Obligations - Designated  Event  described in Section
                  1.1(n)(i)  of  this  Restated   Agreement  has  triggered  the
                  operation of this Section 11.7 and the failure which gave rise
                  to the  occurrence  of such  Change of Control  Obligations  -
                  Designated  Event has been remedied prior to the expiration of
                  the notice period  provided for in this Section  11.7(c),  the
                  Trustee shall not take the action described in the immediately
                  preceding  paragraph  hereof and all of the provisions of this
                  Restated  Agreement shall continue to apply to the same extent
                  and as fully as they would have in the event that such  Change
                  of Control Obligations - Designated Event had not occurred.

         (d)      The required amount of funding or the portion of the Letter of
                  Credit to be drawn on for  purposes of this Section 11.7 shall
                  be   determined  by  the  Actuary  and  shall  be  the  amount
                  determined in accordance with Sections  11.5(a) through (l) of
                  this  Restated  Agreement  offset by the amount  determined in
                  accordance with subparagraphs 11.6(e)(i) through (xii) of this
                  Restated Agreement. The settlement amount for purposes of this
                  Section  11.7  shall  be  determined  in  accordance  with the
                  provisions of Schedule "B-1".

         (e)      In the event that the Change of Control  Obligations have been
                  funded in accordance  with the terms hereof as a result of the
                  occurrence  of a Change of Control  Obligations  -  Designated
                  Event described in Section  1.1(n)(ii),  the Change of Control
                  Obligations  shall be promptly  settled with the  Executive in
                  accordance with the provisions of Schedule "B-1".

11.8     The actuarial  methods and assumptions  described in Schedule "B-1" and
         Schedule  "B-2" shall be reviewed from time to time.  Any amendments to
         Schedule  "B-1" and/or  Schedule "B-2" as a result of such review shall
         be dealt with in accordance with Section 13.6.

11.9     The Trustee shall surrender the Letter of Credit to the Corporation for
         cancellation upon the earliest of:

         (a)      receipt by the  Trustee of a written  direction  signed by the
                  Corporation  and  the  Executive  directing  surrender  of the
                  Letter of Credit;

         (b)      receipt by the  Trustee of a written  direction  signed by the
                  Corporation  confirming  that it has funded and/or settled the
                  Obligations in accordance with the terms hereof, together with
                  evidence  which  is  satisfactory  to the  Trustee  that  such
                  funding and/or settlement has occurred; and

<PAGE>
                                      -28-


         (c)      receipt by the  Trustee of a written  direction  signed by the
                  Corporation  confirming  that the Corporation has no remaining
                  Obligations to the Executive,  together with evidence which is
                  satisfactory  to  the  Trustee  that  the  Corporation  has no
                  remaining Obligations to the Executive and that a copy of such
                  written direction has been provided to the Executive.

11.10    The Trust shall be terminated by the Trustee upon the earliest of:

         (a)      receipt by the  Trustee of a written  direction  signed by the
                  Corporation  and the Executive  confirming the  termination of
                  the Trust;

         (b)      the  entire  depletion  of the  Trust  Fund  through  payments
                  pursuant  to the  terms of the Trust  Agreement,  in the event
                  that such  depletion  occurs  subsequent to the funding of the
                  Obligations  in  accordance  with the  terms of this  Restated
                  Agreement; and

         (c)      receipt by the  Trustee of a written  direction  signed by the
                  Corporation  confirming  that the Corporation has no remaining
                  Obligations to the Executive,  together with evidence which is
                  satisfactory  to  the  Trustee  that a copy  of  such  written
                  direction has been provided to the Executive.

         Upon the termination of the Trust, any assets of the Trust which remain
         after the satisfaction of any remaining  Obligations of the Corporation
         to the Executive shall be returned to the Corporation.

11.11    The  Corporation  and  the  Executive   hereby   acknowledge  that  the
         Corporation  is  entering  into  agreements  similar  to this  Restated
         Agreement with certain of its other executives and that the Corporation
         may, at its sole discretion,  arrange for one or more Letters of Credit
         to satisfy its responsibilities  under this Restated Agreement and such
         other agreements. In the event that one Letter of Credit is obtained to
         satisfy  the   Corporation's   responsibilities   under  this  Restated
         Agreement  and some or all of such other  agreements,  references  to a
         "Letter  of  Credit"  in  this  Restated  Agreement  shall  be  read as
         references  to that portion of such Letter of Credit which is referable
         to the responsibilities of the Corporation to the Executive.

         The Corporation and the Executive also acknowledge that the Corporation
         may, at its sole discretion, enter into one or more Trust Agreements to
         satisfy its  responsibilities  under this  Restated  Agreement and such
         other agreements. In the event that one Trust Agreement is entered into
         to satisfy  the  Corporation's  responsibilities  under  this  Restated
         Agreement  and  some or all of such  other  agreements,  references  to
         "Trust",  "Trust Agreement",  "Trustee" and "Refundable Tax Account" in
         this Restated Agreement shall be read with such modifications as may be
         necessary in the context.

11.12    At the discretion of the  Corporation  and subject to the provisions of
         applicable  law, in the event that all or a portion of the  Obligations
         are  funded in  accordance  with  Article  11 hereof  and an  actuarial
         surplus (determined by actuarial valuation in accordance with the terms

<PAGE>
                                      -29-


         of the report prepared as at the immediately  preceding  Valuation Date
         in accordance with Section 11.3 of this Restated Agreement) arises as a
         result thereof:


         (a)      all or a portion of such actuarial  surplus may be used in the
                  determination of or to reduce the funding  otherwise  required
                  to be provided by the Corporation hereunder; or


         (b)      any surplus assets may, to the extent that they exceed 110% of
                  the amount  required to fund that  portion of the  Obligations
                  which has been funded (as determined by the report prepared as
                  at the immediately preceding Valuation Date in accordance with
                  Section 11.3 of this  Restated  Agreement)  be returned to the
                  Corporation.


                                   ARTICLE 12
                              EXPEDITED ARBITRATION
                              ---------------------

12.1     If, pursuant to Section 7.1 of this Restated  Agreement,  the Executive
         provides  written notice of the Executive's  intention to terminate the
         Executive's  employment for Good Reason,  and the Corporation  believes
         that  there is no Good  Reason,  or,  alternatively,  if,  pursuant  to
         Section  4.1 of  this  Restated  Agreement,  the  Corporation  provides
         written notice of its intention to terminate the Executive's employment
         for Just Cause and the Executive  believes there is no Just Cause,  the
         Corporation or the Executive,  as  applicable,  shall,  within ten (10)
         days of having  been  provided  such  notice,  provide  written  notice
         ("Notice  of   Dispute")  to  the  other  Party  of  the  dispute  (the
         "Dispute").

12.2     The Parties agree that any and all Disputes  under Section 12.1 of this
         Restated Agreement will be resolved by way of a single Arbitrator.

12.3     (a)      Within  fifteen  (15)  days  of  provision  of the  Notice  of
                  Dispute,  the  Parties  shall agree upon and appoint a neutral
                  Arbitrator  from the then  current  roster  maintained  by the
                  Alberta Mediation and Arbitration Society to act as Arbitrator
                  of the Dispute; or

         (b)      If no person  acceptable  to both Parties has been agreed upon
                  and appointed  within fifteen (15) days, then either Party may
                  make  immediate  application  to the Court of Queen's Bench of
                  Alberta,  Judicial District of Calgary,  to have an Arbitrator
                  appointed.

12.4     The Parties  acknowledge  and agree that the purpose of this Article 12
         is to avoid delays and facilitate  resolution of the Dispute in a just,
         speedy and cost-effective manner.

12.5     Consistent  with the expedited  nature of  arbitration,  the Arbitrator
         will  direct  and  control  the scope and  timing  of the  exchange  of
         information  between  the  Parties  and  will  take  such  steps as the
         Arbitrator deems necessary to achieve a just, speedy and cost-effective

<PAGE>
                                      -30-


         resolution of the Dispute.  The Arbitrator has the exclusive  right and
         power to resolve all issues  related to the exchange of  information in
         the arbitration process.

12.6     The Parties agree that the  Arbitrator is only  authorized to determine
         whether the Executive had Good Reason for  terminating  the Executive's
         employment, or alternatively, whether the Corporation had Just Cause to
         terminate the Executive's employment.

12.7     A hearing will occur within  forty-five (45) days of the appointment of
         the Arbitrator (the  "Hearing").  The time of the Hearing (the "Hearing
         Date") will be scheduled by the Arbitrator after  consultation with the
         Parties.  The  Hearing  will be  governed  by the  rules set out in the
         ARBITRATION ACT S.A. 1991, c.A-43, as modified by the Arbitrator in the
         interests of achieving a just, speedy and cost-effective  resolution of
         the Dispute.  The Arbitrator may require written submissions of fact in
         the Dispute to be provided seven (7) days before the Hearing Date.

12.8     The  Arbitrator  will use best  efforts to  provide a written  decision
         within seven (7) days of the conclusion of the Hearing.

12.9     The Parties agree that the decision of the Arbitrator will be final and
         binding upon the Parties.


                                   ARTICLE 13
                                     GENERAL
                                     -------

13.1     The headings of the Articles and paragraphs in this Restated  Agreement
         are inserted for  convenience  only and shall not affect the meaning or
         construction of this Restated Agreement.

13.2     This  Restated   Agreement   shall  be  construed  and  interpreted  in
         accordance  with the laws of the  Province  of Alberta  and the federal
         laws of Canada as applicable therein.

13.3     If any provision of this Restated Agreement is determined to be void or
         unenforceable  in  whole or in part,  it shall be and be  deemed  to be
         severed from this Restated Agreement without affecting or impairing the
         validity of any other provision herein.

13.4     Any notice  required  or  permitted  to be given  under  this  Restated
         Agreement  shall be in writing and shall be properly given if delivered
         by hand  delivery  or mail or other  form of  electronic  communication
         capable of transmission confirmation to the following address:

         a.       IN THE CASE OF THE CORPORATION TO:
                  ----------------------------------

                  Nexen Inc.
                  801 - 7th Avenue S.W.
                  Calgary, AB  T2P 3P7
                  Attention:  General Manager, Compensation and Benefits

<PAGE>
                                      -31-


         b.       IN THE CASE OF THE EXECUTIVE TO:
                  --------------------------------

                  the  last  address  of the  Executive  in the  records  of the
                  Corporation  or to such other  address as the Parties may from
                  time to time specify by notice given in accordance herewith.

13.5     This  Restated  Agreement  shall enure to the benefit of and be binding
         upon  the  Executive   and  the   Executive's   heirs,   executors  and
         administrators and upon the Corporation and its successors and assigns.

13.6     This Restated  Agreement  constitutes the entire agreement  relating to
         the  respective   rights  and  obligations  of  the  Parties  upon  the
         occurrence  of a Change  of  Control.  No  amendment  or waiver of this
         Restated  Agreement  shall be binding unless executed in writing by the
         Parties.

         Notwithstanding the foregoing,

         (a)      any  amendment  to  Article  11 of  this  Restated  Agreement,
                  Schedule  "B-1" or Schedule  "B-2" which is required to ensure
                  that the balance remaining in the Trust after the required tax
                  has been withheld and remitted to the Canada Revenue Agency is
                  sufficient to satisfy the fee levied by the Bank in connection
                  with the  issuance  of a Letter of  Credit  may be made by the
                  Corporation   without  the  prior  written   approval  of  the
                  Executive; and

         (b)      the Corporation may amend,  modify or waive Article 11 of this
                  Restated Agreement, Schedule "B-1" and Schedule "B-2" in whole
                  or in part,  at such time and from  time to time,  and in such
                  manner  and to such  extent as it may deem  advisable  without
                  obtaining  the approval of the  Executive,  provided that such
                  amendment,  modification  or waiver,  as the case may be, does
                  not adversely affect the securitization in accordance with the
                  terms hereof of those Obligations which have accrued up to the
                  date of such amendment,  modification  or waiver,  as the case
                  may be.

13.7     The Parties agree that the rights, entitlements and benefits set out in
         this Restated  Agreement to be paid to the  Executive  upon a Change of
         Control  shall be in full  satisfaction  of all rights of the Executive
         under applicable law in effect from time to time as a result thereof.

13.8     Neither  Party can waive or shall be deemed to have waived any right it
         has under this Restated Agreement except to the extent that such waiver
         is in writing.

13.9     Nothing  contained  in this  Restated  Agreement  shall be construed as
         limiting the ability of the  Corporation to amend,  modify or terminate
         the  Executive  Benefit Plan in whole or in part, at such time and from
         time to time,  and in such  manner  and to such  extent  as it may deem
         advisable.

<PAGE>
                                      -32-


The Parties have  executed  this  Restated  Agreement  effective  the date first
written above.


                                           NEXEN INC.


                                           Per: (signed)
                                                --------------------------------

                                           Per: (signed)
                                                --------------------------------


SIGNED, SEALED & DELIVERED
in the presence of


(signed)                                   (signed)
-------------------------------            -------------------------------------
WITNESS                                    CHARLES W. FISCHER


<PAGE>

                                  SCHEDULE "A"
                                  ------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS

In order to  receive  the  entitlements  referred  to in the  Article  8 of this
Restated  Agreement,  the Executive  shall execute the attached  Release,  fully
releasing the Corporation from all further claims in relation to the Executive's
employment or Employment  Benefits and the  termination  thereof upon payment of
the  remuneration  and  benefits  referred  to in  Article  8 of  this  Restated
Agreement.  The attached Release shall not, however,  require that the Executive
relinquish  or release any rights to indemnity  which the  Executive  may, as an
officer or director of the Corporation or any of its Affiliates,  Associates and
Subsidiaries,  have  as  against  the  Corporation  or any  of  its  Affiliates,
Associates and Subsidiaries, for costs, charges and expenses reasonably incurred
by the Executive in respect of any civil,  criminal or administrative  action or
proceeding  to which the  Executive is made a party by reason of being or having
been a  director  or  officer  of  the  Corporation  or  any of its  Affiliates,
Associates and Subsidiaries, where:

         (a)      the Executive has acted honestly and in good faith with a view
                  to  the  best  interests  of  the  Corporation  or  any of its
                  Affiliates, Associates and Subsidiaries; and

         (b)      in  the  case  of  a  criminal  or  administrative  action  or
                  proceeding  enforced by a monetary penalty,  the Executive had
                  reasonable  grounds for believing the Executive's  conduct was
                  lawful.



<PAGE>

                                  FINAL RELEASE
                                  -------------

KNOW  ALL MEN BY THESE  PRESENTS  that I,  CHARLES  W.  FISCHER,  of the City of
Calgary, in the Province of Alberta, in consideration of the amounts provided in
that certain  Amended and Restated  Agreement  Respecting  Change of Control and
Executive Benefit Plan  Entitlements (the "Restated  Agreement") dated as of the
______ day of  ____________,  2008  between  myself and NEXEN INC. and for other
good and valuable consideration,  the receipt and sufficiency of which is hereby
acknowledged, do for myself, my executors and assigns hereby remise, release and
forever discharge the Corporation, and any associated,  affiliated,  predecessor
or parent corporation of the Corporation and their present and former directors,
officers,  agents  and  employees  (the  "Releasees"),  including  each of their
respective  successors,  heirs,  administrators and assigns,  from all manner of
actions,  causes of action, debts,  obligations,  covenants,  claims or demands,
whatsoever  which I may ever have had, now have, or can,  shall or may hereafter
have against the  Releasees  or any of them,  by reason of or arising out of any
cause,  matter  or  thing  whatsoever  done,  occurring  or  existing  up to and
including the present date and, in  particular,  without in any way  restricting
the  generality  of the  foregoing,  in  respect  of all  claims  of any  nature
whatsoever,  past,  present  or future,  directly  or  indirectly  related to or
arising out of or in connection with my relationship  with the Releasees,  as an
employee,  officer or director,  and the  termination of my employment  from the
Corporation including, but not limited to, any claims related to any entitlement
I may have or may have had to any payment or claim either at common law or under
the EMPLOYMENT  STANDARDS CODE, HUMAN RIGHTS,  CITIZENSHIP AND  MULTICULTURALISM
ACT or any other  applicable  legislation  governing or related to my employment
with the Releasees.


AND FOR THE SAID  CONSIDERATION,  I, CHARLES W.  FISCHER,  represent and warrant
that I have not assigned to any person,  firm or corporation any of the actions,
causes of action,  claims, suits,  executions or demands which I release by this
Release,  or with  respect  to which I agree  not to make any  claim or take any
proceeding herein.


IT IS FURTHER ACKNOWLEDGED that the payment to me includes full compensation and
consideration  for the  loss  of my  employment  benefits,  as  provided  by the
Releasees,  and that all of my employment benefits and privileges shall cease on
the date of termination of my employment, except as otherwise expressly provided
in the  Restated  Agreement.  I further  acknowledge  that I have  received  all
benefits  due to me and have no further  claim  against the  Releasees  for such
benefits.  I further accept sole responsibility to replace such benefits which I

<PAGE>
                                      -2-


wish to continue or to exercise  conversion  privileges  where  applicable  with
respect to such  benefits and, in  particular  any life  insurance and long-term
disability benefits.  In the event that I become disabled following  termination
of my  employment,  I covenant not to sue the  Releasees  for insurance or other
benefits  or loss of same and  hereby  release  the  Releasees  from any and all
further obligations or liabilities arising therefrom.


Notwithstanding  anything contained herein,  this Release shall not extend to or
affect,  or  constitute a release of, my right to sue,  claim against or recover
from the  Releasees  and shall not  constitute  an  agreement  to  refrain  from
bringing, taking or maintaining any action against the Releasees in respect of:


                  (a)      any corporate indemnity existing by statute, contract
                           or pursuant to any of the constating documents of the
                           Corporation  provided  in my favour in  respect of my
                           having  acted at any time as a  director,  officer or
                           both of the Corporation;


                  (b)      my  entitlement  to any insurance  maintained for the
                           benefit  or  protection   of  the  directors   and/or
                           officers  of  the  Corporation,   including   without
                           limitation,   directors'   and  officers'   liability
                           insurance; or


                  (c)      my entitlement to any amounts or compensation  due to
                           me under the terms of my  employment  pursuant to the
                           Restated Agreement.


IT IS HEREBY AGREED that the terms of the Restated Agreement and of this Release
will be kept  confidential.  No party hereto shall communicate any such terms to
any third party under any  circumstances  whatsoever,  excepting  any  necessary
communication with my legal and financial advisors,  as required, on the express
condition  that they maintain the  confidentiality  thereof,  and any disclosure
which is required by law,  although either party shall be at liberty to disclose
to third  parties  that a  mutually  acceptable  Release  was agreed  upon.  The
invalidity  and  unenforceability  of any  provision of this  Release  shall not
affect the validity or  enforceability  of any other  provision of this Release,
which shall remain in full force and effect.

<PAGE>
                                      -3-


I HEREBY  DECLARE that I have read all of this  Release,  fully  understand  the
terms of this Release and voluntarily accept the consideration  stated herein as
the sole  consideration  for this  Release  for the purpose of making a full and
final  settlement with the Releasees.  I further  acknowledge and confirm that I
have been given an adequate period of time to obtain  independent  legal counsel
regarding the meaning and the significance of the terms herein and the covenants
mutually exchanged.


IT IS HEREBY AGREED THAT as a term of the  termination of my employment from the
Corporation,  and in consideration of the amount noted above, I hereby resign as
officer and director of the Corporation and its affiliates.


IN  WITNESS  WHEREOF,  I have  hereunto  set my hand and seal this  _____ day of
______________ in the year _________.




-------------------------------------
CHARLES W. FISCHER



-------------------------------------
WITNESS (signature)



-------------------------------------
WITNESS (print name)



<PAGE>

                                 SCHEDULE "B-1"
                                 --------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS
          METHODOLOGY AND ASSUMPTIONS FOR DETERMINING SETTLEMENT VALUE


PURPOSE

In  accordance  with the terms of the  Restated  Agreement,  the purpose of this
Schedule "B-1" is to outline the calculation  approach such that,  after tax has
been paid on a lump sum settlement  value, the remaining  balance is intended to
be sufficient to provide after-tax monthly payments  equivalent to the after-tax
monthly  payments  the  Executive  would  have  received  under the terms of the
Executive Benefit Plan as provided for under this Restated Agreement.



OVERVIEW FOR DEFINED BENEFIT PENSION

The  following  outlines the  actuarial  methods,  assumptions  and  calculation
process to be used in determining  the lump sum settlement  value of the defined
benefit pension  entitlements  under the Executive  Benefit Plan when settlement
occurs in accordance with Section 11 of the Restated  Agreement.  Section 300 of
the Income Tax  Regulations  establishes  the  procedure  applicable in using an
after-tax lump sum to purchase a prescribed annuity:

1.       A prescribed annuity payment consists of two components: (a) the deemed
         capital element of the annuity payment on which no tax is payable,  and
         (b) the deemed  non-capital  portion of the  annuity  payment  which is
         taxed at the marginal rate.

2.       The capital  portion of each future annuity payment is considered to be
         a return of the original after-tax lump sum amount.

3.       The  non-capital  portion  of each  annuity  payment  is  assumed to be
         provided by the  investment  return on the original  after-tax lump sum
         amount and has therefore not yet been taxed.

4.       A constant  percentage of each future  payment is deemed to be a return
         of the original lump sum capital.

CALCULATION METHODOLOGY

1.       Equivalent after-tax payments:

a.       Determine initial gross annual pension  entitlement under the Executive
         Benefit Plan.

b.       Determine  after-tax  annual  pension  entitlement  under the Executive
         Benefit Plan based on Individual Tax Rate as defined in Schedule "B-1".

<PAGE>
                                      -2-


c.       Determine the capital element based on the non-indexed present value of
         the pension payments divided by life expectancy.

d.       Determine the monthly payment which provides an after-tax pension equal
         to the after-tax  pension  determined in 1.b. above in accordance  with
         the prescribed annuity methodology.

2.       Present value of periodic payments from 1. above:

a.       Determine  the present value of the pension  determined  in 1.d.  above
         using the  assumptions  described  below in this  Schedule  "B-1".  For
         greater certainty, the value of the post-retirement indexation is to be
         reflected  in  determining  the present  value of the  accrued  pension
         entitlement in respect of post-1992 service, and any accrued pension in
         respect of service granted during the Severance Period.

3.       Tax adjustment:

a.       Gross-up the present value  determined in 2.a. above to reflect the tax
         assumed to be required to be paid on the lump sum.

b.       Gross-up the amount determined in 3.a. above to reflect the tax assumed
         to be required to be paid on investment earnings in respect of the lump
         sum  payment  during  the  deferral  period  prior to  assumed  pension
         commencement, if any.

4.       Equivalent present value after tax as the after-tax monthly payments:

a.       The amount  determined in 3.b.  above shall be the lump sum  settlement
         value of the Executive's pension entitlement.

ASSUMPTIONS

Interest Discount Rate:

--  during deferral period                 Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately  preceding  the  date  of
                                           calculation,  rounded  down  to  next
                                           lower 0.5.

--  after assumed pension commencement     Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately  preceding  the  date  of
                                           calculation,  rounded  down  to  next
                                           lower 0.5,

                                           less

<PAGE>
                                      -3-


                                           assumed  escalation of pensions after
                                           retirement.

Increase in Consumer Price Index:          Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately  preceding  the  date  of
                                           calculation,

                                           less

                                           Yield  on  long-term   Government  of
                                           Canada Real Return bonds as published
                                           in  the   Bank  of   Canada   Review,
                                           described  in CANSIM  series  V122553
                                           (or a successor  series) for the last
                                           trading  Wednesday  at the end of the
                                           month immediately  preceding the date
                                           of calculation.

                                           The result of the  difference is then
                                           rounded up to the next highest 0.5% .

Escalation of Pensions After Retirement:   75% of CPI, less 1% (minimum increase
                                           25% of CPI). Applies only to benefits
                                           accrued  for service  after  December
                                           31, 1992.

Mortality:

--  for life expectancy                    1994  Uninsured  Pensioner  Mortality
                                           Table  with  mortality   improvements
                                           projected to 15 years beyond the date
                                           of termination.

--  for present values

       o  prior to assumed pension         Nil.
          commencement

       o  after assumed pension            1994  Uninsured  Pensioner  Mortality
          commencement                     Table  with  mortality   improvements
                                           projected 15 years beyond the date of
                                           termination.

Marital Status:                            Actual status at date of termination.

Age of Spouse:                             Based on actual date of birth.

Individual Tax Rate:                       Maximum individual  marginal tax rate
                                           for employee's province of employment
                                           at the date of termination.

<PAGE>

                                 SCHEDULE "B-2"
                                 --------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS

METHODOLOGY  AND  ASSUMPTIONS FOR DETERMINING THE AMOUNT TO BE SECURED OR FUNDED
IN  ACCORDANCE  WITH SECTION 11 BASED ON THE  METHODOLOGY  DESCRIBED IN SCHEDULE
"B-1"


PURPOSE

The purpose of this Schedule "B-2" is to provide the actuarial  methodology  and
assumptions  for  determining  the amount to be secured or funded in  accordance
with Section 11 of the Restated Agreement.

METHODOLOGY

The settlement methodology is described in Schedule B-1.

The funding methodology  applicable to the Executive Benefit Plan Obligations is
based on the following:

1.       Estimate the accrued pension payable from the Executive Benefit Plan as
         at the Valuation Date.

2.       Assume  that the  assets  of the plan are to be  invested  in long term
         Government  of  Canada  bonds and  subject  to the 50%  refundable  tax
         applicable to retirement compensation arrangements.

3.       Determine the present value of the amounts in 1 through 2 above.

4.       Estimate the settlement value that could be paid in accordance with the
         methodology and assumptions described in Schedule B-1.

5.       The funding amount in respect of the Executive Benefit Plan Obligations
         shall be the  greater of the amount  determined  in  accordance  with 1
         through 3 above and the amount in 4 above.

ASSUMPTIONS

Interest Discount Rate:

--  during deferral period                 Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately preceding the Anniversary
                                           Date, rounded down to next lower 0.5.

<PAGE>
                                       -2-

--  after assumed pension commencement     Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately preceding the Anniversary
                                           Date,  rounded down to next lower 0.5
                                           , less assumed escalation of pensions
                                           after retirement.

Increase in Consumer Price Index:          Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately preceding the Anniversary
                                           Date,

                                           less

                                           Yield  on  long-term   Government  of
                                           Canada Real Return bonds as published
                                           in  the   Bank  of   Canada   Review,
                                           described  in CANSIM  series  V122553
                                           (or a successor  series) for the last
                                           trading  Wednesday  at the end of the
                                           month   immediately   preceding   the
                                           Anniversary Date.

                                           The result of the  difference is then
                                           rounded up to the next highest 0.5%.

Escalation of Pensions After Retirement:   75% of CPI, less 1% (minimum increase
                                           25% of CPI). Applies only to benefits
                                           accrued  for service  after  December
                                           31, 1992.

Mortality:

-- for life expectancy                     1994  Uninsured  Pensioner  Mortality
                                           Table  with  mortality   improvements
                                           projected  to  15  years  beyond  the
                                           Calculation Date.

-- for present values

    o  prior to assumed pension            Nil.
       commencement

    o  after assumed pension               1994  Uninsured  Pensioner  Mortality
                                           Table  with  mortality   improvements
                                           projected   15   years   beyond   the
                                           Calculation Date.

<PAGE>
                                       -3-


Marital Status:                           Actual status at the Anniversary.

Age of Spouse:                            Based on actual date of birth.

Individual Tax Rate:                      Maximum individual  marginal tax rate
                                          for employee's province of employment
                                          at the Anniversary Date

Bonus:                                    Target  bonus % applied to the salary
                                          rate at the Valuation Date

Investment return:                        Yield  on  long-term   Government  of
                                          Canada bonds as published in the Bank
                                          of Canada Review, described in CANSIM
                                          series   V122544   (or  a   successor
                                          series)   for   the   last    trading
                                          Wednesday  at the  end  of the  month
                                          immediately preceding the Anniversary
                                          Date rounded down to next lower 0.5%,
                                          and then divided by 2

Decrements:                               None assumed prior to Calculation Date

Eligibility for Pensions:                 100% vested

Pension Commencement Age:

--   eligible for subsidized early        Payable  at  the  completion  of  the
     retirement on the Calculation Date   Severance  Period.   Payable  at  the
     (i.e., age 55 and 10 years of        Calculation   Date  for  purposes  of
     continuous service)                  determining the amount required under
                                          Section 11.6(e).

--   not eligible for early retirement    Deferred  to age 60 or the end of the
     on the Calculation Date              Severance Period if later. Payable at
                                          age 60 for  purposes  of  determining
                                          the  amount  required  under  Section
                                          11.6(e).


Fluctuation reserve (1)                   15% of the pension obligations

Cost of borrowing to settle               Yield  on  one  month  Government  of
the obligations:                          Canada Treasury Bills as published in
                                          the Bank of Canada Review,  described
                                          in  CANSIM   series   V122529  (or  a
                                          successor   series)   for  the   last
                                          trading  Wednesday  at the end of the
                                          month   immediately   preceding   the
                                          Anniversary  Date,  rounded up to the
                                          next higher 0.25%, plus 1.50%
<PAGE>
                                       -4-



--------------------------------------------------------------------------------
NOTES:

(1)  Referred to by Section 11.5(g),  Section 11.6(e)(viii) and 11.6(e)(x).  The
     15% load is intended  to provide a reserve for a potential  decrease in the
     Interest  Discount  Rate in  combination  with  potential  increases in the
     Consumer Price Index for an aggregate change of 1.0%.





<PAGE>

                                  SCHEDULE "C"
                                  ------------

               AMENDED AND RESTATED AGREEMENT RESPECTING CHANGE OF
                 CONTROL AND EXECUTIVE BENEFIT PLAN ENTITLEMENTS

                    ESTIMATED(1) ENTITLEMENT TO COMPENSATION
                 PURSUANT TO ARTICLE 8 OF THE RESTATED AGREEMENT

-------------------------------------------------------------------------------
EMPLOYEE - CHARLES W. FISCHER
-------------------------------------------------------------------------------
Base Salary                                                         $4,095,000
-------------------------------------------------------------------------------
Bonus Target Value                                                  $3,276,000
-------------------------------------------------------------------------------
Benefits Uplift                                                       $532,350
-------------------------------------------------------------------------------
Car Allowance                                                          $93,600
-------------------------------------------------------------------------------
Savings Plan                                                          $245,700
-------------------------------------------------------------------------------
Financial Counselling Services                                         $10,500
-------------------------------------------------------------------------------
Security Monitoring Services                                            $2,400
-------------------------------------------------------------------------------

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

TOTAL VALUE                                                          $8,255,550
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
ADDITIONAL LUMP SUM SETTLEMENT VALUE OF PENSION(2)                 $11,225,692
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
TOTAL ESTIMATED ENTITLEMENT                                        $19,481,242
-------------------------------------------------------------------------------

In addition to the above,  Section 8.1(c) of the Restated Agreement provides for
Executive  Outplacement  counselling  to be provided  by a firm  selected by the
Executive, at a cost to the Corporation not to exceed $25,000.

IN ADDITION to the above pension entitlement under the Agreement,  the Executive
has the following  pension  entitlements  under the Registered  Pension Plan and
Executive  Benefit  Plan.  As is the case with the figures  shown  above,  these
values  are  estimated  values  (as of April 1,  2008) and are for  illustrative
purposes  only.  Actual  values  will  be  calculated  as of  the  date  of  the
entitlement or payment in accordance  with the  Registered  Pension Plan and the
Executive Benefit Plan, respectively, and therefore may be subject to change.

o   Accrued Annual Defined Benefit Pension Entitlement
    (Registered Pension Plan)(3)                                         $30,341

o   Estimated Lump Sum Value of Executive Benefit Plan(4)            $13,033,649




--------------------------
(1)      As  stated  in  Section  8.1  of  the  Restated  Agreement,  the  above
         calculations represent only the current estimated value (as of April 1,
         2008) of the Executive's  entitlement to compensation  upon a Change of
         Control.  Accordingly,  the  above  calculations  are for  illustrative
         purposes only.

(2)      Calculated in accordance with Section 8.1(b) of the Restated Agreement.

         -  Adjustment to EBP lump sum value to reflect settlement $5,163,010.

         -  Additional  settlement value of pension accrued during the severance
            period upon a change of control $6,062,682.

(3)      Benefit payable immediately at April 1, 2008

(4)      Based on the  Standards of Practice for  Determining  Pension  Commuted
         Values  approved by the Canadian  Institute  of  Actuaries  using rates
         applicable  for April  2008  terminations,  as well as  actual  gender,
         marital status, and spouse's date of birth.

<PAGE>

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS

This amended and restated agreement  respecting change of control and executive
benefit plan entitlements made as of the 17th day of September, 2008.


BETWEEN:

                    NEXEN INC., a corporation  incorporated  under the
                    laws of Canada

                                  (hereinafter referred to as the "Corporation")

                                     - and -

                    MARVIN F. ROMANOW

                                    (hereinafter referred to as the "Executive")

RECITALS:

1.     The Executive,  as Executive Vice President and Chief  Financial  Officer
       ("CFO") of the Corporation, is considered by the Board to be an essential
       officer and  employee  of the  Corporation,  who is both  integral to the
       operation  and   development  of  the   Corporation,   and  has  acquired
       outstanding   skills,   unique  experience  and  possesses  an  extensive
       background in, and knowledge of, the Corporation's  business,  operations
       and the industry in which it is engaged.

2.     In the  event of a Change of  Control,  there is a  possibility  that the
       employment  of the Executive  would be  terminated  without just cause or
       adversely modified and the Executive has expressed concern in that regard
       to the Corporation.

3.     The Board  recognizes  that it is essential and in the best  interests of
       the Corporation  and its  shareholders  that the  Corporation  retain the
       continued  dedication of the Executive to the Executive's  office and the
       Executive's  employment  during the uncertain period prior to, during and
       following a Change of Control.

4.     The Board further believes that the past service of the Executive and the
       Executive's  integral  role  in  the  development  and  operation  of the
       Corporation  requires that the Corporation  ensure that in the event of a
       Change of Control  the  Executive  is  treated in a manner  that is fair,
       reasonable,  consistent with industry standards and in the best interests
       of the Corporation.

5.     The  Corporation  and the  Executive  entered  into a Change  of  Control
       Agreement on October 22, 1999, which was amended by an Amending Agreement
       dated December 25, 2000 (collectively the "Original  Agreement") to agree
       on the terms  and  conditions  which  would  govern  the  termination  or
       modification  of the  employment of the  Executive  following a Change of
       Control.

<PAGE>
                                      -2-


6.     The Original  Agreement  was replaced  and  superseded  by an Amended and
       Restated  Change of Control  Agreement  on  January  9,  2002,  which was
       amended by an Amending  Agreement dated May 30, 2003  (collectively,  the
       "Current   Agreement")   which,   among  other   matters,   detailed  the
       Corporation's  security and funding  obligations in respect of the Change
       of  Control  Obligations  (as  hereinafter  defined),  provided  for  the
       securitization  and funding of the Executive Benefit Plan Obligations (as
       hereinafter  defined) and provided for the  cessation of the  Executive's
       coverage  under  the  Statement  of  Company   Procedure   Regarding  the
       Securitization of Nexen Inc. Restated  Executive Benefit Plan, as amended
       or replaced from time to time (the "Securitization Procedure").

7.     The Corporation and the Executive wish to amend the Current  Agreement as
       herein  provided and, in doing so, wish to restate the Current  Agreement
       as herein amended (the "Restated Agreement").

NOW  THEREFORE,  in  consideration  of the mutual  covenants and agreements set
forth in this Restated Agreement and for other good and valuable consideration,
the receipt and  sufficiency of which are hereby  acknowledged  by the Parties,
the Parties agree as follows:

                                   ARTICLE 1
                                  DEFINITIONS
                                  -----------

1.1    In this Restated Agreement, the following terms shall mean as follows:

       (a)    "ACTING  JOINTLY OR IN CONCERT" for the purposes of this  Restated
              Agreement,  a Person is acting  jointly or in concert with another
              Person  if  such  Person  has  any   agreement,   arrangement   or
              understanding  (whether  formal or informal  and whether or not in
              writing)  with such  other  Person for the  purpose of  acquiring,
              offering  to  acquire,   or  voting  any  Common   Shares  of  the
              Corporation  (other  than  customary  agreements  with and between
              underwriters  and  banking  group or selling  group  members  with
              respect to a  distribution  of  securities by way of prospectus or
              private  placement  or pursuant to a pledge of  securities  in the
              ordinary course of business).

       (b)    "ACTUARY"  has the  meaning  referred  to in Section  11.2 of this
              Restated Agreement.

       (c)    "AFFILIATE"  and  "ASSOCIATE"  have the  meaning  ascribed to such
              terms in National Instrument 45-106.

       (d)    "ANNIVERSARY  DATE" has the meaning referred to in Section 11.3 of
              this Restated Agreement.

<PAGE>

                                      -3-

       (e)    "ANNUAL BASE SALARY" means the annual base salary of the Executive
              payable  by the  Corporation  at the end of the month  immediately
              preceding the Date of Termination.

       (f)    "ANNUAL TARGET BONUS" means the Executive's annual target bonus as
              determined  by the Board to be in effect for the calendar  year in
              which a Change of Control occurs.

       (g)    "BANK"  has  the  meaning  referred  to in  Section  11.2  of this
              Restated Agreement.

       (h)    "BENEFICIAL OWNER" for the purposes of this Restated Agreement,  a
              Person  shall be deemed to be the  "BENEFICIAL  OWNER" and to have
              "BENEFICIAL OWNERSHIP" of and to "BENEFICIALLY OWN":

              (i)    any  securities  as to  which  such  Person  or any of such
                     Person's Affiliates or Associates is the owner at law or in
                     equity;

              (ii)   any  securities  as to  which  such  Person  or any of such
                     Person's  Affiliates or  Associates  has a right to acquire
                     (i) upon the exercise of any Convertible Securities or (ii)
                     pursuant to any agreement,  arrangement  or  understanding,
                     whether  such  right is  exercisable  immediately  within a
                     period of sixty (60) days  thereafter and whether or not on
                     condition or the happening of any contingency,  (other than
                     (a) customary  agreements with and between underwriters and
                     banking group and selling group members with respect to the
                     distribution  to  the  public  or  pursuant  to  a  private
                     placement  of  securities,  or (b)  pursuant to a pledge of
                     securities in the ordinary course of business); and

              (iii)  any  securities  which are  Beneficially  Owned  within the
                     meaning  of  clauses  (a) or (b) above by any other  Person
                     with which such Person is Acting Jointly or in Concert,

              provided,   however,  that  a  Person  shall  not  be  deemed  the
              "Beneficial  Owner"  or to have  "Beneficial  Ownership"  of or to
              "Beneficially   Own"  any  security   where  such  Person  is  the
              registered  holder of  securities  as a result of  carrying on the
              business of or acting as nominee for a securities depository.

              For purposes of this Restated Agreement,  the percentage of Common
              Shares Beneficially Owned by any Person, shall be and be deemed to
              be the product determined by the formula:

              100 x A/B

              Where:

              A  =  the  number  of  votes  for the  election  of all  directors
                    generally  attaching to the Common Shares Beneficially Owned
                    by such Person; and

<PAGE>

                                      -4-

              B  =  the  number  of  votes  for the  election  of all  directors
                    generally attaching to all outstanding Common Shares.

              For  the  purposes  of  the  foregoing  formula,  where  a  Person
              Beneficially  Owns  unissued  Common  Shares which may be acquired
              pursuant to  Convertible  Securities,  such Common Shares shall be
              deemed  to be  outstanding  for the  purpose  of  calculating  the
              percentage of Common Shares  Beneficially  Owned by such Person in
              both the  numerator  and the  denominator,  but no other  unissued
              Common  Shares  which  may  be  acquired  pursuant  to  any  other
              outstanding Convertible Securities shall, for the purposes of that
              calculation, be deemed to be outstanding.

       (i)    "BOARD"  means  the  Board  of  Directors  of the  Corporation  as
              constituted from time to time.

       (j)    "CBCA" means the Canada Business Corporations Act, as amended from
              time to time, and any successor legislation thereto.

       (k)    "CALCULATION  DATE" has the meaning referred to in Section 11.5 of
              this Restated Agreement.

       (l)    "CHANGE OF CONTROL" means the occurrence of any of:

              (i)    the  purchase  or  acquisition  of  any  Common  Shares  or
                     Convertible  Securities by a Beneficial Owner which results
                     in the Beneficial  Owner owning,  or exercising  control or
                     direction  over,  Common Shares or  Convertible  Securities
                     such that,  assuming  only the  conversion  of  Convertible
                     Securities  Beneficially  Owned or over  which  control  or
                     direction  is  exercised  by  the  Beneficial   Owner,  the
                     Beneficial   Owner  would  own,  or  exercise   control  or
                     direction  over,  Common Shares  carrying the right to cast
                     more than thirty-five  percent (35%) of the votes attaching
                     to all Common Shares; or

              (ii)   the  substantial   completion  of:  (i)  the   liquidation,
                     dissolution or winding-up of the  Corporation;  or (ii) the
                     sale,  lease or other  disposition of all or  substantially
                     all of the assets of the Corporation; or

              (iii)  a situation  in which  individuals  who were members of the
                     Board immediately prior to:

                     (A)    a meeting  of the  shareholders  of the  Corporation
                            involving  a  contest  for,  or an item of  business
                            relating to, the election of directors; or

                     (B)    an  amalgamation,   arrangement,   merger  or  other
                            consolidation or combination of the Corporation with
                            another Person,

<PAGE>

                                      -5-

                     shall not constitute a majority of the Board following such
                     election or transaction; or

              (iv)   the completion of any  transaction or the first of a series
                     of transactions which would have the same or similar effect
                     as any transaction or series of transactions referred to in
                     paragraphs (i), (ii) or (iii) above; or

              (v)    a determination by the Board that, for the purposes of this
                     Restated Agreement,  a Change of Control has occurred or is
                     imminent.

       (m)    "CHANGE OF CONTROL OBLIGATIONS" means the Company's obligations to
              make  the lump  sum  payments  described  in  Section  8.1 of this
              Restated Agreement to the Executive.

       (n)    A "CHANGE OF CONTROL  OBLIGATIONS  -  DESIGNATED  EVENT"  shall be
              deemed to have occurred if:

              (i)    the  Corporation  fails to  arrange  for the  extension  or
                     replacement  of a Letter of Credit in  accordance  with the
                     terms of this Restated Agreement; or

              (ii)   the Executive's employment is terminated in accordance with
                     Section 5.1, 6.1 or 7.1 of this Restated Agreement.

       (o)    "COMMON SHARES" means the common shares of the Corporation.

       (p)    "CONVERTIBLE SECURITIES" means:

              (i)    any right  (contractual  or  otherwise  and  regardless  of
                     whether  such  right  constitutes  a  security)  to acquire
                     Common Shares from the Corporation; or

              (ii)   any security  issued by the  Corporation  from time to time
                     (other than the rights issued  pursuant to a  shareholders'
                     rights  protection  plan,  if any)  carrying any  exercise,
                     conversion or exchange right,

              which is then exercisable or exercisable  within a period of sixty
              (60) days from that time pursuant to which the holder  thereof may
              acquire Common Shares or other  securities  which are  convertible
              into or  exercisable  or  exchangeable  for Common Shares (in each
              case, whether such right is then exercisable or exercisable within
              a period of sixty  (60) days from that time and  whether or not on
              condition or the happening of any contingency).

       (q)    "DATE OF  TERMINATION"  means the date upon which the  Executive's
              employment is terminated  pursuant to Section 4.1, 5.1, 6.1 or 7.1
              of this  Restated  Agreement.  For  greater  clarity,  the Date of
              Termination means the date upon which the Corporation provides the
              Executive   with   written,   verbal  or  other  notice  that  the
              Executive's  employment has been or will be terminated pursuant to
              Section 4.1

<PAGE>

                                      -6-

              or 6.1 of this  Restated  Agreement  or the date  upon  which  the
              Executive provides the Corporation with written notice terminating
              the Executive's  employment  pursuant to Section 4.1 or 5.1 or for
              Good Reason pursuant to Section 7.1.

       (r)    "DISABILITY"  means,  where due to a physical or mental condition,
              the  Executive  is  rendered  totally  and  permanently  unable to
              perform the Executive's duties for a consecutive period of two (2)
              years or more during  which the  Executive  has been in receipt of
              long term disability insurance benefits from the insurance carrier
              normally utilized by the Corporation.

       (s)    "DISPUTE"  has the  meaning  referred  to in Section  12.1 of this
              Restated Agreement.

       (t)    "EFFECTIVE  DATE"  means the date upon  which a Change of  Control
              occurs.

       (u)    "EMPLOYMENT  BENEFITS" means the employment  benefits to which the
              Executive  is entitled by virtue of any  written,  oral or implied
              agreement with the Corporation.  For the purposes of this Restated
              Agreement, "Employment Benefits" shall include, but is not limited
              to, the following:

              (i)    the  Executive's  entitlement  to  any  dental  or  general
                     medical care;

              (ii)   the Executive's entitlement to receive long term disability
                     benefits from the insurance  carrier  normally  utilized by
                     the Corporation;

              (iii)  the Executive's  entitlement to pension  benefits under the
                     terms of any pension plan with the Corporation;

              (iv)   the Executive's entitlement to a monthly car allowance from
                     the Corporation;

              (v)    the  Executive's   entitlement  to   contributions  by  the
                     Corporation to the Corporation's savings plan;

              (vi)   the Executive's entitlement to receive from the Corporation
                     financial counseling  services,  at a cost of $3,500.00 per
                     year (or as the same may be increased  from time to time by
                     the Corporation); and

              (vii)  the Executive's entitlement to receive from the Corporation
                     security  monitoring  services at the Executive's  personal
                     residence.

       (v)    "EXECUTIVE  BENEFIT  PLAN" has the meaning  referred to in Section
              8.1(b) of this Restated Agreement.

       (w)    "EXECUTIVE  BENEFIT  PLAN  OBLIGATIONS"  means  the  Corporation's
              outstanding  obligations  under the Executive  Benefit Plan to the
              Executive.

<PAGE>

                                      -7-

       (x)    An "EXECUTIVE  BENEFIT PLAN OBLIGATIONS - DESIGNATED  EVENT" shall
              be deemed to have occurred if:

              (i)    a Change of Control occurs;

              (ii)   the  Corporation  makes an  assignment  for the  benefit of
                     creditors  or files a  petition  in  bankruptcy  or becomes
                     insolvent or bankrupt;

              (iii)  a receiver, trustee or liquidator of or for the Corporation
                     is appointed and is not discharged within a period of sixty
                     days;

              (iv)   the net worth of the Corporation,  described as shareholder
                     equity  in the  consolidated  financial  statements  of the
                     Corporation  as  disclosed  in  the  annual  and  quarterly
                     consolidated  financial  statements of the Corporation,  is
                     less than $400 million;

              (v)    the  Corporation  fails to  arrange  for the  extension  or
                     replacement  of a Letter of Credit in  accordance  with the
                     terms of this Restated Agreement;

              (vi)   the  Executive  has provided  written  notification  to the
                     Trustee  and  to the  Corporation  of  the  failure  by the
                     Corporation  to pay any amount owed to or in respect of the
                     Executive  under the  Executive  Benefit Plan within thirty
                     days of the due date  specified  in the  Executive  Benefit
                     Plan  (together  with a  statement  of the  amount  due and
                     owing) either to the person  entitled  thereto  pursuant to
                     the  Executive  Benefit Plan or to the Trust in  accordance
                     with the provisions of Section 11.6(h); or

              (vii)  at any time the Board  adopts a  resolution  to the  effect
                     that, for purposes of this Restated Agreement, an Executive
                     Benefit Plan Obligations - Designated Event has occurred or
                     is imminent.

       (y)    "GOOD  REASON"  means any of the  following,  unless the Executive
              shall have given the Executive's express written consent thereto:

              (i)    INCONSISTENT DUTIES. The assignment to the Executive of any
                     duties  inconsistent  with  the  Executive's  status  as an
                     executive   officer  of  the   Corporation  or  a  material
                     alteration  in the  nature  or  status  of the  Executive's
                     responsibilities  or duties or reporting  relationship from
                     those in effect immediately prior to a Change of Control;

              (ii)   REDUCED  SALARY.  A  reduction  by the  Corporation  in the
                     Executive's  Annual Base Salary in effect on the  Effective
                     Date or as the same may be increased  thereafter  from time
                     to time or the  failure  by the  Corporation  to grant  the
                     Executive salary increases at a rate  commensurate with the
                     increases accorded to other executives of the Corporation;

<PAGE>

                                      -8-

              (iii)  RELOCATION.  The Corporation  requiring the Executive to be
                     based  anywhere  other than where the Executive is based at
                     the time a Change of Control  occurs,  except for  required
                     travel  on  the   Corporation's   business   to  an  extent
                     substantially  consistent  with  the  Executive's  business
                     travel  obligations  in the  ordinary  course  of  business
                     immediately prior to a Change of Control;

              (iv)   INCENTIVE   COMPENSATION   PLANS.   The   failure   by  the
                     Corporation   to   continue   in   effect   any   incentive
                     compensation  plan in  which  the  Executive  participates,
                     including,  but not limited to, the Incentive  Compensation
                     Plan or the Stock  Option Plan or any other  similar  plans
                     adopted prior to a Change of Control,  unless the Executive
                     is  eligible  to  participate  in, and is  entitled  to the
                     opportunity  to  receive  a  comparable  level of  benefits
                     under, an ongoing, substitute or alternative plan (it being
                     understood  that the  manner or method of  payment  and the
                     form of  consideration  need not be the same as  existed in
                     the original  plans);  or the failure by the Corporation to
                     continue the Executive's  participation therein on at least
                     as  favourable  a basis,  both in terms  of the  amount  of
                     benefits  available to the  Executive  and the level of the
                     Executive's  participation  relative to other participants,
                     as existed at the time a Change of Control occurs;

              (v)    EMPLOYMENT  BENEFITS  AND  PERQUISITES.  The failure by the
                     Corporation  to  continue  to provide  the  Executive  with
                     Employment Benefits at least as favourable as those enjoyed
                     by the Executive  immediately prior to a Change of Control,
                     including any pension plan,  benefit plan or any retirement
                     arrangement  established  for the Executive,  or any of the
                     Corporation's life insurance, medical, health and accident,
                     disability  or  savings  plans in which the  Executive  was
                     participating  at the time a Change of Control occurs;  the
                     taking of any action by the Corporation that would directly
                     or  indirectly  materially  reduce  any  such  benefits  or
                     deprive the Executive of any material perquisite enjoyed by
                     the  Executive  at the time a  Change  of  Control  occurs,
                     including, without limitation and to the extent applicable,
                     the use of a car, aircraft,  secretarial  services,  office
                     space,    telephones,    computer    facilities,    expense
                     reimbursement, financial counselling, and professional fees
                     and  club  dues  reimbursement;   or  the  failure  by  the
                     Corporation  to provide  the  Executive  with the number of
                     paid  vacation  days to which the  Executive is entitled in
                     accordance with the Corporation's  normal vacation practice
                     in effect at the time a Change of Control occurs;

              (vi)   NO ASSUMPTION BY SUCCESSOR.  The failure of the Corporation
                     to obtain a  satisfactory  agreement  from a  successor  to
                     assume  and  agree  to  perform  this  Restated  Agreement.
                     Alternatively, if the business or undertaking in connection
                     with  which  the   Executive's   services  are  principally
                     performed  is sold at any time  after a Change  of  Control
                     occurs, and the Executive's

<PAGE>

                                      -9-

                     employment  is  transferred  as a result,  the  failure  or
                     refusal of the purchaser of such business or undertaking to
                     provide  the  Executive  with  the  same  or  a  comparable
                     position,  duties,  compensation and benefits, as described
                     in  paragraphs  (iv)  and (v)  above,  as  provided  to the
                     Executive by the Corporation  immediately prior to a Change
                     of Control;

              (vii)  DISPOSITION OF "ALL OR SUBSTANTIALLY  ALL". The disposition
                     by  the  Corporation  of all  or  substantially  all of the
                     assets  of  the   Corporation,   as  contemplated   herein,
                     notwithstanding  that the Executive's services were or were
                     not principally performed for such business.

       (z)    "HEARING"  has the  meaning  referred  to in Section  12.7 of this
              Restated Agreement.

       (aa)   "HEARING DATE" has the meaning referred to in Section 12.7 of this
              Restated Agreement.

       (bb)   "INCENTIVE   COMPENSATION  PLAN"  means  any  bonus  or  incentive
              compensation  plan of the  Corporation  in which the  Executive is
              entitled to receive benefits in the month immediately  preceding a
              Change of Control.

       (cc)   "JUST CAUSE" means:

              (i)    the failure by the Executive to  substantially  perform the
                     Executive's   duties   according   to  the   terms  of  the
                     Executive's  employment in existence immediately prior to a
                     Change  of  Control  after  the  Corporation  has given the
                     Executive   reasonable   notice  of  such   failure  and  a
                     reasonable opportunity to correct it; or

              (ii)   where  the  Executive   engages  in  any  criminal  act  or
                     dishonesty  resulting  or intended  to result,  directly or
                     indirectly,  in the personal  gain of the  Executive at the
                     Corporation's expense.

       (dd)   "LETTER OF CREDIT" has the meaning  referred to in Section 11.2 of
              this Restated Agreement.

       (ee)   "MONTHLY  BASE  SALARY"  means the monthly  salary  payable to the
              Executive  by the  Corporation  in  effect at the end of the month
              immediately preceding the Effective Date.

       (ff)   "NOTICE OF DISPUTE" has the meaning referred to in Section 12.1 of
              this Restated Agreement.

       (gg)   "OBLIGATIONS"   means,   collectively,   the   Change  of  Control
              Obligations and the Executive Benefit Plan Obligations.

<PAGE>

                                     -10-

       (hh)   "PARTIES" means the Corporation,  and its successors and permitted
              assigns,  and the Executive and the Executive's  heirs,  executors
              and administrators and "PARTY" means either one of them.

       (ii)   "PERSON" includes an individual,  partnership,  association,  body
              corporate, trustee, executor, administrator,  legal representative
              and any national, provincial, state or municipal government or any
              agency thereof.

       (jj)   "REFUNDABLE   TAX  ACCOUNT"   means  the  refundable  tax  account
              maintained in respect of the Trust by the Canada Revenue Agency.

       (kk)   "REGISTERED  PENSION PLAN" has the meaning  referred to in Section
              8.1(b) of this Restated Agreement.

       (ll)   "RESTATED  AGREEMENT"  means this amended and  restated  agreement
              respecting   change  of  control  and   executive   benefit   plan
              entitlements as it may be amended,  restated or supplemented  from
              time to time, and the expressions  "hereof",  "herein",  "hereto",
              "hereunder",  "hereby",  and  similar  expressions  refer  to this
              Restated  Agreement  and,  unless  otherwise  indicated,  refer to
              Articles or Sections in this Restated Agreement only.

       (mm)   "SECURITIZATION  PROCEDURE"  has the  meaning  referred  to in the
              recitals of this Restated Agreement.

       (nn)   "SEVERANCE PERIOD" means

              (i)    for the purposes of Section 6.1 and 7.1 herein (as referred
                     to  in  Article  8)  the   thirty-six   (36)  month  period
                     immediately following the Date of Termination; and

              (ii)   for the  purposes of Section 5.1 herein (as  referred to in
                     Article  8)  the  thirty  (30)  month  period   immediately
                     following the Date of Termination.

       (oo)   "STOCK  OPTION  PLAN" means any stock  option plan or plans of the
              Corporation  pursuant to which the Executive is granted options by
              the Corporation to acquire Common Shares.

       (pp)   "SUBSIDIARY" has the meaning ascribed to it in the CBCA.

       (qq)   "TAX ACT" means the Income Tax Act  (Canada)  and the  Regulations
              thereunder, both as amended from time to time.

       (rr)   "TERM" has the meaning referred to in Section 3.1 of this Restated
              Agreement.

<PAGE>

                                     -11-

       (ss)   "TRUST"  has  the  meaning  referred  to in  Section  11.1 of this
              Restated Agreement.

       (tt)   "TRUST  AGREEMENT" has the meaning  referred to in Section 11.1 of
              this Restated Agreement.

       (uu)   "TRUSTEE"  means CIBC  Mellon  Trust  Company or such other  trust
              company duly incorporated under the laws of Canada or any province
              thereof  whom  the  Company  may   designate  as  the  trustee  in
              connection with the security and funding of the Obligations.

       (vv)   "VALUATION  DATE" has the meaning  referred to in Section  11.3 of
              this Restated Agreement.


                                   ARTICLE 2
                          SCOPE OF RESTATED AGREEMENT
                          ---------------------------

2.1    The  Parties  intend  that  this  Restated  Agreement  sets out (a) their
       respective  rights and  obligations  upon the  occurrence  of a Change of
       Control  and in  connection  with the  securitization  and funding of the
       Change of  Control  Obligations;  and (b)  their  respective  rights  and
       obligations  regarding  the  securitization  and funding of the Executive
       Benefit Plan  Obligations.  This Restated  Agreement does not provide for
       any  other  terms of the  Executive's  employment  with the  Corporation,
       except as expressly provided for herein.

2.2    The Parties hereby confirm that except as otherwise  expressly  stated in
       this Restated Agreement, insofar as the securitization and funding of the
       Executive  Benefit  Plan  Obligations  is  concerned,  the  terms of this
       Restated  Agreement  shall  govern  and the  terms of the  Securitization
       Procedure shall not be applicable.

2.3    This Restated Agreement shall  automatically  terminate upon the death of
       the  Executive  or where  due to the  Disability  of the  Executive,  the
       Executive is materially  incapacitated  from  performing the  Executive's
       duties.  In the event of the death or  Disability of the  Executive,  the
       Executive (or the  Executive's  estate) shall be entitled to receive from
       the  Corporation  all unpaid  Annual Base  Salary,  Employment  Benefits,
       unpaid business expenses and vacation  entitlement accrued to the date of
       the  death  or  Disability  of  the  Executive.  The  Executive  (or  the
       Executive's  estate)  shall also be entitled to receive any and all death
       or Disability benefits in a manner consistent with, and at least equal in
       amount to, those  provided by the  Corporation  to senior  executives (or
       their  estate)  under such plans,  programs and policies in effect at the
       date of Disability or death of the Executive,  and the Corporation  shall
       have no further  obligations to the Executive or the  Executive's  estate
       under this Restated Agreement.  Any entitlements of the Executive (or the
       Executive's  estate)  under  the  Executive  Benefit  Plan  which  remain
       following the  termination  of this Restated  Agreement  pursuant to this
       Section 2.3 shall then  commence to be covered  under the  Securitization
       Procedure.

2.4    If the  Executive's  employment is  terminated  by either Party,  for any
       reason,  prior to a Change of Control in any manner, other than expressly
       provided for in this Restated  Agreement,  this Restated  Agreement shall
       automatically  terminate  and  the  Corporation  shall  have  no  further
       obligations to the Executive hereunder. Any remaining entitlements of the


<PAGE>

                                     -12-

       Executive  under the  Executive  Benefit Plan which remain  following the
       termination of this Restated Agreement pursuant to this Section 2.4 shall
       then commence to be covered under the Securitization Procedure.


                                   ARTICLE 3
                           TERM OF RESTATED AGREEMENT
                           --------------------------

3.1    Subject to  termination of this Restated  Agreement  prior to a Change of
       Control,  this  Restated  Agreement  shall  remain in effect for a period
       concluding  thirteen  (13)  months  following  the  Effective  Date  (the
       "Term"), at which time this Restated Agreement shall terminate;  provided
       however that the payment of  compensation  and benefits to the  Executive
       under this Restated  Agreement  shall continue beyond the end of the Term
       in accordance with the applicable  provisions of this Restated Agreement.
       Any remaining  entitlements of the Executive under the Executive  Benefit
       Plan which remain  following the  termination of this Restated  Agreement
       pursuant to this Section 3.1 shall then  commence to be covered under the
       Securitization Procedure.


                                   ARTICLE 4
            TERMINATION FOR JUST CAUSE OR FOR OTHER THAN GOOD REASON
            --------------------------------------------------------

4.1    If the  Executive's  employment  is  terminated  for  Just  Cause,  or is
       terminated by the  Executive,  other than pursuant to Section 5.1 of this
       Restated  Agreement or for other than Good Reason,  following a Change of
       Control, the Corporation shall pay to the Executive, if not already paid,
       the  fraction of the unpaid  Annual Base Salary  accrued  during the then
       current fiscal year of the Corporation,  all accrued Employment Benefits,
       all unpaid  reasonable  business  expenses  and all unpaid  vacation  pay
       accrued up to and including the Date of Termination,  and thereafter, the
       Corporation shall have no further obligations to the Executive under this
       Restated Agreement.

4.2    Nothing in this  Restated  Agreement  shall  serve to  derogate  from the
       vested rights of the Executive to pension benefits, Stock Option Plans or
       any other  Employment  Benefits to which the  Executive is entitled up to
       the Date of Termination.


                                   ARTICLE 5
                             VOLUNTARY TERMINATION
                             ---------------------

5.1    In the  event  of a Change  of  Control,  the  Executive  shall  have the
       unfettered  right,  within  thirty  (30) days after the twelve (12) month
       period  following the Effective Date, to elect to provide the Corporation
       with written notice terminating his employment.  Upon being provided such
       written  notice,   the  Corporation   shall  pay  to  the  Executive  the
       remuneration referred to in Article 8 of this Restated Agreement.

<PAGE>

                                     -13-


                                   ARTICLE 6
                           TERMINATION BY CORPORATION
                           --------------------------

6.1    If the Executive's employment is terminated by the Corporation within the
       thirteen (13) month period following the Effective Date, for reason other
       than Just Cause,  death or Disability,  the Corporation  shall pay to the
       Executive  the  remuneration  referred  to in Article 8 of this  Restated
       Agreement.


                                   ARTICLE 7
                          TERMINATION FOR GOOD REASON
                          ---------------------------

7.1    In the event of a Change of Control, the Executive may, within the twelve
       (12) month period  following  the Effective  Date and upon  providing the
       Corporation with ten (10) days written notice,  terminate the Executive's
       employment with the Corporation for Good Reason. Upon being provided with
       such notice,  the Corporation shall pay to the Executive the remuneration
       referred to in Article 8 of this Restated Agreement.


                                   ARTICLE 8
                         COMPENSATION UPON TERMINATION
                         -----------------------------

8.1    If the  Executive's  employment is terminated in accordance  with Section
       5.1, 6.1 or 7.1 of this Restated Agreement:

       (a)    the Corporation shall forthwith,  but in any event within ten (10)
              days from receipt by the Corporation of a Release  executed by the
              Executive  substantially  in the form of Schedule  "A", pay to the
              Executive:

              (i)    if not  previously  paid,  that portion of the  Executive's
                     accrued but unpaid  Monthly  Base  Salary,  any accrued but
                     unpaid  bonus to which the  Executive  is entitled  for the
                     preceding  calendar year under any  Incentive  Compensation
                     Plan,  all  unpaid  reasonable  business  expenses  and all
                     accrued  but unused  vacation  pay earned or payable to the
                     Executive  by the  Corporation  for  the  period  from  the
                     beginning of the Corporation's then current fiscal year, up
                     to and including the Date of Termination;

              (ii)   a lump sum cash payment  equal to the  Executive's  Monthly
                     Base  Salary  and  one-twelfth  (1/12)  of the  Executive's
                     Annual Target Bonus for each month of the Severance Period;

              (iii)  a lump sum payment  equal to thirteen  percent (13%) of the
                     Executive's  Annual  Base Salary for the  Severance  Period
                     representing  the value of the  group  health  and  welfare
                     benefits for the Severance Period;

              (iv)   a  lump  sum   payment   representing   the  value  of  the
                     Executive's monthly car allowance for the Severance Period;

<PAGE>

                                     -14-


              (v)    a  lump  sum   payment   representing   the  value  of  the
                     Corporation's  contributions to the  Corporation's  savings
                     plan  (at a rate of six  percent  (6%)  of the  Executive's
                     Annual Base Salary) for the Severance Period;

              (vi)   a  lump  sum   payment   representing   the  value  of  the
                     Executive's  entitlement  to receive  from the  Corporation
                     financial counseling services for the Severance Period; and

              (vii)  a  lump  sum   payment   representing   the  value  of  the
                     Executive's  entitlement  to receive  from the  Corporation
                     security  monitoring  services at the Executive's  personal
                     residence for the Severance Period;

       (b)    with respect to the  Executive's  entitlement to pension  benefits
              under  the  Pension  Plan for  Employees  of Nexen  Inc.  (Defined
              Benefit Option) (the "Registered  Pension Plan"),  if any, and the
              Executive's  related  entitlement  under the Nexen  Inc.  Restated
              Executive Benefit Plan (the "Executive Benefit Plan"), if any:

              (i)    the Corporation  shall  recognize the Severance  Period for
                     purposes of determining the Executive's entitlement;

              (ii)   for calculation  purposes,  the Executive's  entitlement is
                     the benefit which would have been determined  assuming that
                     the Executive had been  employed  throughout  the Severance
                     Period, including recognition of:

                     (A)    additional service that would have been credited for
                            the Severance Period;

                     (B)    monthly salary equal to the Executive's Monthly Base
                            Salary throughout the Severance Period;

                     (C)    pensionable  bonus  for  the  year  of the  Date  of
                            Termination, and for each subsequent year or portion
                            thereof during the Severance  Period,  determined at
                            the Annual Target Bonus level. Average bonus will be
                            determined  over the  three  years to the end of the
                            Severance  Period,  including  any partial  calendar
                            years; and

                     (D)    if  the  Executive  would  have  been  eligible  for
                            retirement at the end of the Severance  Period,  the
                            Executive shall be deemed to retire, and the pension
                            to  commence,   upon  completion  of  the  Severance
                            Period.  In such case, the Executive's  attained age
                            at  the  end  of  the   Severance   Period  will  be
                            recognized  for  purposes of  calculating  the early
                            retirement reduction factor, if applicable; and

              (iii)  the pension  entitlements  described in this Section 8.1(b)
                     shall,  to the  extent  legally  permissible,  be  provided
                     through the Registered  Pension Plan. To the extent that it
                     is  not  legally   permissible   to  provide  such  pension
                     entitlements

<PAGE>

                                     -15-

                     through the Registered  Pension Plan, the Corporation shall
                     pay to the  Executive a lump sum payment  representing  the
                     settlement value of the additional  Executive  Benefit Plan
                     benefit  determined in accordance  with the assumptions set
                     forth in Schedule "B-1";

              (iv)   any  entitlements  of the  Executive  under  the  Executive
                     Benefit   Plan  which  have   previously   been  funded  in
                     accordance  with Article 11 but not  previously  settled in
                     accordance   with  Article  11  shall  be  settled  by  the
                     Corporation in accordance with the assumptions set forth in
                     Schedule "B-1";

       (c)    with respect to the  Executive's  entitlement to pension  benefits
              under  the  Pension  Plan for  Employees  of Nexen  Inc.  (Defined
              Contribution Option) (the "Defined Contribution Pension Plan"), if
              any, and the Executive's  related  entitlement under the Executive
              Benefit Plan, if any:

              (i)    the  Corporation  shall make a contribution  to the Defined
                     Contribution  Pension  Plan in an amount  which is equal to
                     the additional  contributions which would have been made by
                     both  the  Executive  and the  Corporation  to the  Defined
                     Contribution  Pension Plan on the Executive's behalf during
                     the  Severance  Period had the  Executive  remained  in the
                     employ  of  the  Corporation   during  such  period.   Such
                     contribution  shall be  calculated at the rate in effect in
                     respect of the Executive  immediately  prior to the Date of
                     Termination.   To  the  extent   that  it  is  not  legally
                     permissible  to  make  such  contribution  to  the  Defined
                     Contribution  Pension Plan,  the  Corporation  shall make a
                     notional allocation to the defined  contribution  provision
                     of the Executive Benefit Plan equal to such contribution;

              (ii)   the Corporation  shall  recognize the Severance  Period for
                     purposes of determining the Executive's  entitlement  under
                     the Executive Benefit Plan;

              (iii)  the  Corporation  shall make a notional  allocation  to the
                     defined  contribution  provision of the  Executive  Benefit
                     Plan in an amount which is equal to the additional notional
                     allocations  which would have been made by the  Corporation
                     to the  defined  contribution  provision  of the  Executive
                     Benefit Plan on the Executive's behalf during the Severance
                     Period  had the  Executive  remained  in the  employ of the
                     Corporation during such period.  Such contribution shall be
                     calculated  at  the  rate  in  effect  in  respect  of  the
                     Executive immediately prior to the Date of Termination. The
                     Corporation  shall make a lump sum payment to the Executive
                     in an amount equal to the balance,  after reflection of the
                     aforementioned  notional allocation,  in the Executive's DC
                     Supplemental  Company  Account as defined in the  Executive
                     Benefit Plan.

<PAGE>

                                     -16-

       (d)    the  Corporation   shall  provide  the  Executive  with  executive
              outplacement  counselling  to be provided by a firm to be selected
              by the  Executive,  at a cost  to the  Corporation  not to  exceed
              $25,000.00;

       (e)    all of the  Executive's  outstanding  unexercisable  stock options
              under any Stock Option Plan shall become exercisable; and

       (f)    where the  Executive  has been  relocated,  at the  request of the
              Corporation,  within the two (2) year period  immediately prior to
              the  Effective  Date,  if  so  requested  by  the  Executive,  the
              Corporation  shall relocate the Executive back to the  Executive's
              prior location.

8.2    The estimated value as of April 1, 2008 of Sections  8.l(a)(ii) to 8.1(d)
       are set out in Schedule "C". Schedule "C" provides  estimated values only
       and actual values shall be  calculated  in accordance  with this Restated
       Agreement  at the time of  entitlement  or payment  under  this  Restated
       Agreement.

8.3    If  the  Executive's   employment  is  terminated  in  the  circumstances
       described  in Section  5.1, 6.1 or 7.1 of this  Restated  Agreement,  the
       remuneration  and  benefits  payable  under  this  Article 8 shall not be
       reduced if the Executive obtains alternative employment.

8.4    Unless  expressly  provided  otherwise in this  Restated  Agreement,  all
       payments  to be made to the  Executive  under  this  Article  8 shall  be
       subject to required statutory deductions at source by the Corporation.


                                   ARTICLE 9
                            CONFIDENTIAL INFORMATION
                            ------------------------

9.1    If the Executive's  employment is terminated in any manner whatsoever due
       to or  following  a Change  of  Control,  the  Executive  agrees  to keep
       confidential  all  information  of a confidential  or proprietary  nature
       concerning the Corporation,  its Affiliates,  Associates and Subsidiaries
       and their respective operations, opportunities, areas of present, past or
       future interests,  assets, finances,  technology,  intellectual property,
       business and  affairs,  and further  agrees not to use such  information,
       data or technology for personal  advantage,  provided that nothing herein
       shall prevent the disclosure of information  which is publicly  available
       or which is required to be disclosed by the Executive  under  appropriate
       statute, rules of law or legal process.


                                   ARTICLE 10
             RIGHTS AND OBLIGATIONS OF EXECUTIVE UPON TERMINATION
             ----------------------------------------------------

10.1   Subject to Section 9.1 of this Restated  Agreement,  the Executive  shall
       not be prohibited in any manner  whatsoever  from  obtaining  alternative
       employment  with or  otherwise  forming  or  participating  in a business
       competitive to the business of the  Corporation  after the termination of
       the Executive's employment with the Corporation.

<PAGE>
                                     -17-


10.2   Upon the  termination of the Executive's  employment for any reason,  the
       Executive shall tender the Executive's  resignation from any position the
       Executive may hold as an officer or director of the Corporation or any of
       its Affiliates, Associates or Subsidiaries.

10.3   If  the  Executive's   employment  is  terminated  in  the  circumstances
       described  in Section  5.1, 6.1 or 7.1 of this  Restated  Agreement,  the
       Corporation  shall  continue  to  purchase  and  maintain,  to the extent
       available in the  marketplace at reasonable cost to the  Corporation,  on
       behalf of the Executive, director and officer liability insurance for the
       applicable  limitation period following the date upon which the Executive
       ceases to serve as a  director  or officer  of the  Corporation,  and the
       Executive's  existing agreement to receive indemnity from the Corporation
       for acts taken by the Executive in the Executive's capacity as an officer
       of the Corporation shall remain in effect.

10.4   Upon termination of the Executive's  employment  pursuant to Section 5.1,
       6.1 or 7.1 of this Restated  Agreement,  the Corporation  shall reimburse
       the  Executive  for  ongoing  legal  fees  and  disbursements  which  the
       Executive may reasonably incur in connection with this Restated Agreement
       (but this Restated Agreement only),  including any litigation  concerning
       the validity or  enforceability  of, or liability under, any provision of
       this Restated  Agreement or any action by the Executive.  The Corporation
       shall pay such fees and  reimbursements to the Executive promptly as such
       fees and disbursements become due.


                                  ARTICLE 11
                      SECURITIZATION AND FUNDING PROCEDURE
                      ------------------------------------

11.1   The  Corporation has established and maintains a trust for the benefit of
       the Executive and persons claiming through him (the "Trust")  pursuant to
       the terms and  conditions of a trust  agreement  (the "Trust  Agreement")
       between the  Corporation  and the  Trustee.  The Trust shall be funded in
       accordance  with the provisions of this Restated  Agreement and the Trust
       Agreement.

11.2   To provide  security  against a failure by the Corporation to either fund
       or settle the  Obligations  in accordance  with the terms of this Article
       11, the Trust  Agreement  provides  for the funding of the Trust with the
       proceeds  of  an  irrevocable   letter  of  credit  which  satisfies  the
       requirements  of this  Restated  Agreement  (a "Letter of Credit") in the
       event that the Corporation does not provide funding or effect  settlement
       when required to do so hereunder and in accordance with the terms hereof.
       The Corporation  confirms that the Letter of Credit currently held by the
       Trustee has been issued by a major  Canadian  chartered bank (the "Bank")
       in an amount calculated by the Corporation's  consulting  actuary (who at
       all times shall be a Fellow of the Canadian  Institute of Actuaries) (the
       "Actuary")  in  accordance  with the  provisions  of Section 11.5 of this
       Restated Agreement.

11.3   On each February 1st (the  "Anniversary  Date"),  the  Corporation  shall
       request a report from the Actuary as to the amount calculated,  as at the
       next succeeding April 1st (the "Valuation  Date"), in accordance with the
       provisions of Section 11.5 of this Restated  Agreement.  The  Corporation
       shall  provide  the Actuary  with the data it  requires  to prepare  such
       report.  Upon  completion  of each such  report,  the  Corporation  shall
       arrange for the Actuary to provide a summary of same to the Trustee.

<PAGE>
                                     -18-



       Prior to the  funding  and/or  settlement  of all of the  Obligations  in
       accordance  with the terms of this Restated  Agreement,  the  Corporation
       shall,  within forty-five days after the applicable  Anniversary Date and
       in accordance with the terms of the report received from the Actuary:

       (a)    either:

              (i)    arrange  for a Letter of Credit to be  provided by the Bank
                     to the Trustee to replace the Letter of Credit then held by
                     the Trustee. The replacement Letter of Credit shall be:

                     (A)    substantially  in the form of the  Letter  of Credit
                            then held by the Trustee;

                     (B)    in an amount  calculated  by the  Actuary  as at the
                            applicable  Valuation  Date in  accordance  with the
                            provisions   of  Section   11.5  of  this   Restated
                            Agreement; and

                     (C)    for a  term  which  commences  on  the  date  of its
                            issuance   and  expires  one  year   following   the
                            applicable Valuation Date; or

              (ii)   confirm to the Trustee in writing that the Letter of Credit
                     then held by the Trustee will be extended automatically for
                     a further  one-year term. The  confirmation  to the Trustee
                     shall include evidence from the Bank as to any amendment to
                     the applicable  Letter of Credit,  any such amendment to be
                     consistent  with the report  prepared  by the Actuary as at
                     the applicable Valuation Date; and

       (b)    contribute  to the Trust an amount  equal to twice the fee charged
              by the Bank in connection  with the Letter of Credit  extension or
              replacement,   as  applicable.   The  Corporation  shall  withhold
              one-half of such amount and shall remit the said  one-half of such
              amount to the Canada Revenue Agency on account of the tax which is
              exigible   pursuant  to  the  Tax  Act  in  connection  with  such
              contribution  to the Trust.  The Trustee shall remit the remaining
              one-half  of such  amount  to the  Bank in  consideration  for the
              Letter of Credit extension or replacement, as applicable.

       When a replacement  Letter of Credit has been provided in accordance with
       the terms of this  Section  11.3,  an existing  Letter of Credit shall be
       surrendered and cancelled.


<PAGE>
                                     -19-


11.4   If,  during  the term of a  Letter  of  Credit  issued  pursuant  to this
       Restated Agreement,  the Corporation,  acting reasonably,  concludes that
       there has been a significant  change in the Obligations since the date of
       the last report prepared by the Actuary  pursuant to Section 11.3 of this
       Restated  Agreement,  the  Corporation  shall  request a report  from the
       Actuary as to the then current  value of the  Obligations,  calculated in
       accordance   with  the  provisions  of  Section  11.5  of  this  Restated
       Agreement.  Upon receipt of the report,  the Corporation  shall provide a
       summary of same to the Trustee and  arrange,  together  with the Trustee,
       for any  required  increase  or  decrease  in the amount of the Letter of
       Credit for the balance of the term of such Letter of Credit. In the event
       that a replacement  Letter of Credit is to be issued in the circumstances
       described in this Section  11.4,  the  Corporation  and the Trustee shall
       arrange for such replacement  Letter of Credit to be provided by the Bank
       to the Trustee to replace the Letter of Credit then held by the  Trustee.
       Upon receipt of a replacement  Letter of Credit  pursuant to this Section
       11.4, the Trustee shall surrender for  cancellation  the Letter of Credit
       then  held  by it  pursuant  to this  Restated  Agreement  and the  Trust
       Agreement.

       In the event that all or any  portion of the fee  referred  to in Section
       11.3 of this Restated Agreement, is refunded by the Bank as a result of a
       decrease  in the amount of a Letter of Credit  pursuant  to this  Section
       11.4, such amount  (together with any resulting  refundable Tax) shall be
       received  by the Trustee  for  deposit to the Trust.  Upon  receipt of an
       Authorized  Instruction (as defined in the Trust Agreement),  the Trustee
       shall pay and transfer  such amounts  (less any  applicable  tax which it
       will remit as  required by the Tax Act on behalf of the  Corporation)  to
       the Corporation for its sole and exclusive use and benefit.

       In the event that an additional fee is required to be paid to the Bank as
       a result of an increase  in the amount of a Letter of Credit  pursuant to
       this Section  11.4,  the  Corporation  shall  contribute  to the Trust an
       amount equal to twice the additional fee. The Corporation  shall withhold
       one-half of such amount and shall remit the said  one-half of such amount
       to the Canada  Revenue  Agency on  account  of the tax which is  exigible
       pursuant  to the Tax Act in  connection  with  such  contribution  to the
       Trust.  The Trustee shall remit the remaining  one-half of such amount to
       the Bank in payment of its additional fee.

11.5   A Letter of Credit issued pursuant to this Restated Agreement shall:

              (i)    be an irrevocable standby letter of credit;

              (ii)   obligate the Bank to satisfy demand for payment made by the
                     Trustee  in  accordance  with the  terms  of this  Restated
                     Agreement and the Trust Agreement;

              (iii)  permit partial drawings; and

              (iv)   provide  that the Bank must notify the Trustee on or before
                     thirty  days  prior to the  expiry of a Letter of Credit of
                     any  notice of  non-extension  provided  by the Bank to the
                     Corporation.

       The  amount of a Letter of Credit  pursuant  to this  Restated  Agreement
       shall be  calculated  by the  Actuary in  accordance  with the  following
       subparagraphs of this Section 11.5.

<PAGE>
                                     -20-


       (a)    Assuming  the lump sum payments  referred to in Section  8.1(a) of
              this Restated  Agreement are equal to the amount thereof  provided
              by the Corporation.

       (b)    Assuming  the  service  of  the  Executive  will   terminate,   in
              accordance  with  Section  5.1,  6.1,  or  7.1  of  this  Restated
              Agreement,  on the next succeeding  March 31st after the Valuation
              Date (the "Calculation Date").

       (c)    Using the  Executive's  demographic  data,  including base salary,
              target bonus and current  marital status as of the Valuation Date,
              provided by the Corporation.

       (d)    Using the Yearly Maximum  Pensionable  Earnings (Y.M.P.E.) used to
              determine  the amount of the Canada  Pension  Plan Benefit and Tax
              Act  maximum  defined  benefit  pension  dollar  limit  as at  the
              Valuation Date.

       (e)    Assuming all Obligations are included.

       (f)    Using  the  actuarial   methods,   assumptions   and   calculation
              methodology described in Schedule "B-2.

       (g)    Applying a load of 15% to the amount determined in accordance with
              subparagraphs  (b) through (f) of this Section 11.5 to provide for
              fluctuations in the Interest  Discount Rate,  Consumer Price Index
              and other plan experience during the term of the Letter of Credit,
              as described in Schedule "B-2".

       (h)    Applying a load to one-half of the amount determined in accordance
              with subparagraphs (a) through (g) of this Section 11.5 to provide
              for  the  cost  associated   with  the  borrowings   described  in
              subparagraph  (k) of this Section  11.5,  as described in Schedule
              "B-2".

       (i)    Including  a  settlement  expense  to  the  amount  determined  in
              subparagraph (h), with the aggregate  settlement expense allowance
              for all  obligations  secured  equal to  $250,000,  or  where  the
              Valuation   Date  is  after   December  31,  2008,  the  aggregate
              settlement  expense  allowance will be increased at the rate equal
              to the  increase in the  Consumer  Price  Index,  as  described in
              Schedule "B-2", plus 1% for each year after 2008.

       (j)    Assuming  the  Obligations  will  be  promptly  settled  with  the
              Executive  upon  occurrence  of a  Designated  Event  described in
              Section 1.1(n)(ii).

       (k)    Assuming  a loan  will be  secured  to  permit  settlement  of the
              Obligations  prior to receipt of the  Refundable  Tax Account from
              the Canada Revenue  Agency.  The assumed  interest rate payable on
              the  loan  shall  be as  described  in  Schedule  "B-2".  The cost
              associated  with the  borrowings  shall be assumed to be paid from
              the Trust.

<PAGE>
                                     -21-


       (l)    The liabilities  calculated in accordance with  subparagraphs  (a)
              through (k) above shall be offset by:

              (i)    the Refundable Tax Account, if any; and

              (ii)   the assets contained in the Trust, if any.

11.6   (a)    If an Executive  Benefit Plan Obligations - Designated Event shall
              occur,  the Corporation  shall be required to immediately fund the
              Executive  Benefit Plan  Obligations  in accordance  with the most
              recent report prepared by the Actuary  pursuant to Section 11.3 of
              this Restated  Agreement.  Notwithstanding  the  foregoing,  if an
              Executive Benefit Plan Obligations - Designated Event described in
              Section 1.1(x)(i) and a Change of Control Obligations - Designated
              Event described in Section 1.1(n)(ii) shall occur  simultaneously,
              the Corporation  shall be required to settle the Executive Benefit
              Plan  Obligations  forthwith in accordance  with the provisions of
              Schedule "B-1".

       (b)    If:

              (i)    the  employment  of  the  Executive  is  terminated  by the
                     Corporation  for any  reason  other than as a result of the
                     death, disability or retirement of such Executive; and

              (ii)   such Executive files with the Corporation a written request
                     that it fund the Executive Benefit Plan Obligations,

              the  Corporation   shall  be  required  to  immediately  fund  the
              Executive  Benefit Plan  Obligations  in accordance  with the most
              recent report prepared by the Actuary  pursuant to Section 11.3 of
              this Restated Agreement.

       (c)    Upon the earlier of:

              (i)    learning of the  occurrence  of an  Executive  Benefit Plan
                     Obligations  -  Designated   Event   described  in  Section
                     1.1(x)(v) or (vi) of this Restated Agreement; or

              (ii)   receipt  of a  written  notice  of  the  occurrence  of  an
                     Executive  Benefit  Plan  Obligations  -  Designated  Event
                     described  in any of the  other  subparagraphs  of  Section
                     1.1(x) of this  Restated  Agreement,  which notice has been
                     signed by two  executives of the  Corporation,  one of whom
                     must be either the Chief  Financial  Officer or the General
                     Counsel of the  Corporation  and which notice must,  in the
                     case of an Executive  Benefit Plan Obligations - Designated
                     Event  described  in  Section  1.1(x)(i)  of this  Restated
                     Agreement, indicate which subparagraph of the definition of
                     "Change of Control" is applicable,

              the  Trustee  shall  promptly  give notice to the  Corporation  in
              writing  that it intends to draw on that  portion of the Letter of
              Credit  which  is  referable   to  the   Executive   Benefit  Plan
              Obligations   and  contribute  the  proceeds   thereof  (less  any
              applicable

<PAGE>
                                     -22-


              withholding  tax which it will remit as required by the Tax Act on
              behalf  of  the  Corporation)  to  the  Trust  on  behalf  of  the
              Corporation   in  order  to  fund  the   Executive   Benefit  Plan
              Obligations,  unless it receives  satisfactory  proof  within nine
              days of such notice that the Corporation has funded or settled, as
              applicable,  the  Executive  Benefit  Plan  Obligations  itself in
              accordance with the terms of this Restated Agreement.

              Unless the Corporation  advises the Trustee in writing that it has
              funded or settled,  as  applicable,  the  Executive  Benefit  Plan
              Obligations  in  accordance   with  the  terms  of  this  Restated
              Agreement  and has provided the Trustee  with  satisfactory  proof
              thereof within nine days of the date of the aforementioned notice,
              the  Trustee  shall  draw on that  portion of the Letter of Credit
              which is referable to the Executive  Benefit Plan  Obligations  on
              the  tenth  day  following  the date of such  notice  (or the next
              following  business  day if such tenth day is not a business  day)
              and   contribute   the  proceeds   thereof  (less  any  applicable
              withholding  tax which it will remit as required by the Tax Act on
              behalf  of  the  Corporation)  to  the  Trust  on  behalf  of  the
              Corporation.

              Notwithstanding  the foregoing,  in the event an Executive Benefit
              Plan Obligations - Designated Event described in Section 1.1(x)(v)
              or (vi) of this Restated  Agreement has triggered the operation of
              this  Section  11.6  and  the  failure  which  gave  rise  to  the
              occurrence of such Executive Benefit Plan Obligations - Designated
              Event has been  remedied  prior to the  expiration  of the  notice
              period provided for in this Section 11.6(c), the Trustee shall not
              take the action described in the immediately  preceding  paragraph
              hereof and all of the provisions of this Restated  Agreement shall
              continue  to apply to the same  extent  and as fully as they would
              have in the event that such Executive  Benefit Plan  Obligations -
              Designated Event had not occurred.

       (d)    Upon receipt of a written  notice of the  occurrence of the events
              described in both subparagraphs (i) and (ii) of Section 11.6(b) of
              this  Restated  Agreement  (which  notice  has been  signed by the
              Executive  and sworn before a notary  public),  the Trustee  shall
              promptly give notice to the Corporation in writing that it intends
              to draw on that portion of the Letter of Credit which is referable
              to the  Executive  Benefit Plan  Obligations  and  contribute  the
              proceeds (less any applicable  withholding tax which it will remit
              as  required by the Tax Act on behalf of the  Corporation)  to the
              Trust on behalf of the  Corporation in order to fund the Executive
              Benefit Plan  Obligations  unless it receives  satisfactory  proof
              within nine days of the date of such  notice that the  Corporation
              has  funded  the  Executive  Benefit  Plan  Obligations  itself in
              accordance with the terms of this Restated Agreement.

              Unless the Corporation  advises the Trustee in writing that it has
              funded the Executive  Benefit Plan  Obligations in accordance with
              the terms hereof and has  provided  the Trustee with  satisfactory
              proof thereof  within nine days of the date of the  aforementioned
              notice, the Trustee shall draw upon that portion of the Letter of

<PAGE>
                                     -23-


              Credit  which  is  referable   to  the   Executive   Benefit  Plan
              Obligations on the tenth day following the date of such notice (or
              the  next  following  business  day  if  such  tenth  day is not a
              business day) and  contribute  the proceeds  (less any  applicable
              withholding  tax which it will remit as required by the Tax Act on
              behalf  of  the  Corporation)  to  the  Trust  on  behalf  of  the
              Corporation.

       (e)    For purposes of determining  the required amount of funding or the
              portion  of the  Letter of Credit to be drawn on for  purposes  of
              this  Section  11.6,  the  Trustee  shall refer to the most recent
              report  prepared  by the Actuary  for  purposes  of this  Restated
              Agreement and, in particular, to the portion of the report dealing
              with the  Executive  Benefit Plan  Obligations.  In preparing  the
              portion  of  its  report   respecting   Executive   Benefit   Plan
              Obligations, the Actuary shall adhere to the following:

              (i)    Assuming that the Executive,  if then in active employment,
                     will remain in active employment with the Corporation as an
                     officer until the Calculation Date and that the Executive's
                     employment  with  the  Corporation  will  terminate  on the
                     Calculation Date.

              (ii)   Using the  Executive's  demographic  data,  including  base
                     salary,  actual  bonus  history,  target  bonus and current
                     marital  status as of the Valuation  Date,  provided by the
                     Corporation.

              (iii)  Using the Canada  Pension  Plan Benefit and Tax Act maximum
                     defined  benefit  pension  dollar limit as at the Valuation
                     Date.

              (iv)   Assuming the Executive's target bonus percentage remains at
                     the  level  specified  by  the   Corporation   pursuant  to
                     subparagraph (ii) above.

              (v)    Assuming  only  Executive   Benefit  Plan  Obligations  are
                     included.

              (vi)   Assuming  the  payments  under the  Executive  Benefit Plan
                     would be made from the Trust.

              (vii)  Using the actuarial  methods,  assumptions  and calculation
                     methodology described in Schedule "B-2.

              (viii) Applying loads as described in Schedule "B-2" to the amount
                     determined in accordance  with the preceding  subparagraphs
                     of this Section 11.6(e) to provide for future contingencies
                     and expenses of the Trust.

              (ix)   Calculating  the  estimated  amount  required to settle the
                     Executive  Benefit Plan Obligations  based on the actuarial
                     methods,  assumptions and calculation methodology described
                     in Schedule "B-2",  increased by the loads described in the
                     following subparagraph.

<PAGE>
                                     -24-


              (x)    Applying loads as described in Schedule "B-2" to the amount
                     determined in accordance with  subparagraph (ix) to provide
                     for:

                     (A)    fluctuations  in  the  Interest  Discount  Rate  and
                            Consumer  Price Index  during the term of the Letter
                            of Credit; and

                     (B)    the cost  associated  with the loan to be secured as
                            allowed   under  the  Trust   Agreement   to  permit
                            settlement of the Executive Benefit Plan Obligations
                            prior to receipt of the  Refundable Tax Account from
                            the Canada Revenue Agency. The assumed interest rate
                            payable  on  the  loan  shall  be  as  described  in
                            Schedule  "B-2" and shall be applied to  one-half of
                            the amount in subparagraph (ix). The cost associated
                            with the borrowings shall be assumed to be paid from
                            the Trust.

              (xi)   Taking the larger amount for the Executive of:

                     (A)    the   amount    determined   in   accordance    with
                            subparagraphs (i) through (viii), and

                     (B)    the   amount    determined   in   accordance    with
                            subparagraphs (ix) and (x).

              (xii)  The amount  determined in accordance with subparagraph (xi)
                     above shall be offset by:

                     (A)    the Refundable Tax Account, if any;

                     (B)    the assets contained in the Trust, if any.

       (f)    In the event that the Executive Benefit Plan Obligations have been
              funded in accordance with the terms hereof as a result of:

              (i)    the  Corporation  making an  assignment  for the benefit of
                     creditors  or filing a petition in  bankruptcy  or becoming
                     insolvent or bankrupt;

              (ii)   a receiver, trustee or liquidator of or for the Corporation
                     being appointed and not being discharged within a period of
                     sixty days;

              (iii)  a voluntary dissolution or wind-up of the Corporation; or

              (iv)   a sale or  disposition of all or  substantially  all of the
                     assets of the Corporation,

              and the Executive  Benefit Plan has been  terminated in connection
              therewith,   the  Executive  Benefit  Plan  Obligations  shall  be
              promptly  settled by the Trustee  with the  Executive  by way of a
              lump sum payment  from the Trust.  For this  purpose,  the benefit
              entitlements

<PAGE>
                                     -25-


              of each Executive shall be determined by the Actuary in accordance
              with the terms of the Executive Benefit Plan and the amount of the
              lump sum payment  shall be  determined  by the  Actuary  using the
              assumptions set forth in Schedule "B-1".  Notice of termination of
              the Executive Benefit Plan shall be provided to the Trustee by the
              Corporation,  failing which by two executives of the  Corporation,
              one of whom must be  either  the Chief  Financial  Officer  or the
              General Counsel of the Corporation.

              Any assets of the Trust remaining  after full  satisfaction of (i)
              the Executive  Benefit Plan Obligations  pursuant to the preceding
              paragraph and (ii) any further  obligations  pursuant to the terms
              of the Trust Agreement, shall be returned to the Corporation.

       (g)    In the event the Executive Benefit Plan shall be terminated at any
              time  either  in whole  or in part in  relation  to the  Executive
              subsequent   to  the  funding  of  the   Executive   Benefit  Plan
              Obligations in accordance  with the terms hereof,  then,  provided
              Section  11.6(f)  of  this  Restated  Agreement  is not  otherwise
              applicable,  the  Executive  Benefit  Plan  Obligations  shall  be
              promptly  settled by the Trustee  with the  Executive  by way of a
              lump sum payment from the Trust.

              For this purpose,  the benefit entitlements of the Executive shall
              be determined  by the Actuary in accordance  with the terms of the
              Executive  Benefit  Plan and the  amount  of the lump sum  payment
              shall be determined by the Actuary using the assumptions set forth
              in Schedule  "B-1".  Notice of the  termination  of the  Executive
              Benefit Plan shall be provided to the Trustee by the  Corporation,
              failing which by two  executives of the  Corporation,  one of whom
              must be either the Chief Financial  Officer or the General Counsel
              of the Corporation.

              Any assets of the Trust remaining  after full  satisfaction of (i)
              the  Executive  Benefit  Plan  Obligations  and (ii)  any  further
              obligations pursuant to the terms of the Trust Agreement, shall be
              returned to the Corporation.

       (h)    In the event:

              (i)    of a dispute  as to  whether a payment  to or in respect of
                     the  Executive is properly due and payable  pursuant to the
                     Executive Benefit Plan; and

              (ii)   such  dispute  cannot be resolved  by the  parties  thereto
                     within the time frame  specified in Section  1.1(x)(vi)  of
                     this Restated Agreement,

              the amount in dispute shall be remitted to the Trustee for deposit
              to the Trust. Upon final settlement of the dispute,  the amount so
              deposited  (together  with any  earnings,  profits and  increments
              thereon and after deduction of any authorized  payments  allocable
              thereto,  both as determined  in accordance  with the terms of the
              Trust Agreement),  less any applicable  withholding tax which will

<PAGE>
                                     -26-


              be  remitted  as  required  by the Tax Act,  shall be paid to that
              party to the dispute which is found to be entitled thereto.  Prior
              to such amount being paid out of the Trust in accordance  with the
              terms hereof,  the Corporation  shall instruct the Actuary to take
              such amount into account when preparing its report for purposes of
              this Restated Agreement.

       (i)    In the event that a Change of  Control  Obligations  -  Designated
              Event described in Section  1.1(n)(ii) of this Restated  Agreement
              shall occur  subsequent  to the funding of the  Executive  Benefit
              Plan  Obligations  in  accordance  with the terms of this Restated
              Agreement,  the  Corporation  shall  be  required  to  settle  the
              Executive   Benefit  Plan  Obligations   forthwith  in  an  amount
              determined  by the Actuary in  accordance  with the  provisions of
              Schedule "B-1".

       (j)    Subject to Section  11.6(f),  11.6(g) and 11.6(i) of this Restated
              Agreement,   in  the  event  that  the   Executive   Benefit  Plan
              Obligations  have been funded in accordance with the terms hereof,
              all or a portion of such Executive  Benefit Plan  Obligations may,
              at the discretion of the Corporation, be promptly settled with the
              Executive.

              For this purpose,  the benefit entitlements of the Executive shall
              be determined  by the Actuary in accordance  with the terms of the
              Executive  Benefit Plan. In such  circumstances,  the  Corporation
              reserves   the  right  to  settle  the   Executive   Benefit  Plan
              Obligations by way of a lump sum payment to the Executive provided
              that the amount of each such payment is  determined by the Actuary
              in accordance with the assumptions set forth in Schedule "B-1".

11.7   (a)    If a Change of Control Obligations - Designated Event described in
              Section  1.1(n)(i) of this  Restated  Agreement  shall occur,  the
              Corporation  shall be required to  immediately  fund the Change of
              Control  Obligations  in  accordance  with the most recent  report
              prepared by the Actuary  pursuant to Section 11.3 of this Restated
              Agreement.

       (b)    If a Change of Control Obligations - Designated Event described in
              Section  1.1(n)(ii) of this Restated  Agreement  shall occur,  the
              Corporation  shall be  required  to settle  the  Change of Control
              Obligations   forthwith  in  accordance  with  the  provisions  of
              Schedule  "B-1",  upon  receipt  by the  Corporation  of a Release
              executed by the  Executive in the form  attached to this  Restated
              Agreement as Schedule "A".

       (c)    Upon the earlier of:

              (i)    learning  of  the   occurrence   of  a  Change  of  Control
                     Obligations  -  Designated   Event   described  in  Section
                     1.1(n)(i) of this Restated Agreement; or

              (ii)   receipt of a written  notice of the  occurrence of a Change
                     of Control  Obligations  -  Designated  Event  described in
                     Section 1.1(n)(ii) of this Restated Agreement, which notice
                     has been signed by the  Executive and sworn before a notary
                     public and has  annexed  thereto a Release  executed by the
                     Executive in the form attached to this  Restated  Agreement
                     as Schedule "A",

<PAGE>
                                     -27-



              the  Trustee  shall  promptly  give notice to the  Corporation  in
              writing  that it intends to draw on that  portion of the Letter of
              Credit which is referable to the Change of Control Obligations and
              contribute the proceeds  thereof (less any applicable  withholding
              tax which it will  remit as  required  by the Tax Act on behalf of
              the  Corporation)  to the Trust on behalf  of the  Corporation  in
              order  to fund  the  Change  of  Control  Obligations,  unless  it
              receives  satisfactory  proof within nine days of such notice that
              the Corporation has funded or settled,  as applicable,  the Change
              of Control Obligations itself in accordance with the terms of this
              Restated Agreement.

              Unless the Corporation  advises the Trustee in writing that it has
              funded  or  settled,   as   applicable,   the  Change  of  Control
              Obligations  in  accordance   with  the  terms  of  this  Restated
              Agreement  and has provided the Trustee  with  satisfactory  proof
              thereof within nine days of the date of the aforementioned notice,
              the  Trustee  shall  draw on that  portion of the Letter of Credit
              which is  referable  to the Change of Control  Obligations  on the
              tenth day following the date of such notice (or the next following
              business  day  if  such  tenth  day  is not a  business  day)  and
              contribute the proceeds (less any applicable withholding tax which
              it  will  remit  as  required  by the  Tax  Act on  behalf  of the
              Corporation) to the Trust on behalf of the Corporation.

              Notwithstanding  the  foregoing,  in the event a Change of Control
              Obligations - Designated  Event described in Section  1.1(n)(i) of
              this  Restated  Agreement  has  triggered  the  operation  of this
              Section 11.7 and the failure which gave rise to the  occurrence of
              such Change of Control  Obligations  -  Designated  Event has been
              remedied prior to the expiration of the notice period provided for
              in this  Section  11.7(c),  the Trustee  shall not take the action
              described in the immediately preceding paragraph hereof and all of
              the provisions of this Restated  Agreement shall continue to apply
              to the same  extent  and as fully as they  would have in the event
              that such Change of Control Obligations - Designated Event had not
              occurred.

       (d)    The  required  amount of funding  or the  portion of the Letter of
              Credit to be drawn on for  purposes of this  Section 11.7 shall be
              determined  by the Actuary and shall be the amount  determined  in
              accordance  with  Sections  11.5(a)  through (l) of this  Restated
              Agreement  offset by the  amount  determined  in  accordance  with
              subparagraphs 11.6(e)(i) through (xii) of this Restated Agreement.
              The  settlement  amount for purposes of this Section 11.7 shall be
              determined in accordance with the provisions of Schedule "B-1".

       (e)    In the event  that the  Change of  Control  Obligations  have been
              funded in accordance with the terms hereof as a result of the

<PAGE>
                                     -28-


              occurrence of a Change of Control  Obligations - Designated  Event
              described in Section 1.1(n)(ii), the Change of Control Obligations
              shall be promptly  settled with the Executive in  accordance  with
              the provisions of Schedule "B-1".

11.8   The actuarial  methods and  assumptions  described in Schedule  "B-1" and
       Schedule  "B-2" shall be reviewed  from time to time.  Any  amendments to
       Schedule "B-1" and/or  Schedule "B-2" as a result of such review shall be
       dealt with in accordance with Section 13.6.

11.9   The Trustee shall  surrender the Letter of Credit to the  Corporation for
       cancellation upon the earliest of:

       (a)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation and the Executive directing surrender of the Letter of
              Credit;

       (b)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation  confirming  that it has  funded  and/or  settled  the
              Obligations  in accordance  with the terms  hereof,  together with
              evidence  which is  satisfactory  to the Trustee that such funding
              and/or settlement has occurred; and

       (c)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation  confirming  that  the  Corporation  has no  remaining
              Obligations  to the  Executive,  together with  evidence  which is
              satisfactory  to the Trustee that the Corporation has no remaining
              Obligations  to the  Executive  and  that a copy of  such  written
              direction has been provided to the Executive.

11.10  The Trust shall be terminated by the Trustee upon the earliest of:

       (a)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation  and the Executive  confirming the  termination of the
              Trust;

       (b)    the entire depletion of the Trust Fund through  payments  pursuant
              to the  terms of the  Trust  Agreement,  in the  event  that  such
              depletion  occurs  subsequent to the funding of the Obligations in
              accordance with the terms of this Restated Agreement; and

       (c)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation  confirming  that  the  Corporation  has no  remaining
              Obligations  to the  Executive,  together with  evidence  which is
              satisfactory to the Trustee that a copy of such written  direction
              has been provided to the Executive.

       Upon the  termination of the Trust,  any assets of the Trust which remain
       after the satisfaction of any remaining Obligations of the Corporation to
       the Executive shall be returned to the Corporation.

11.11  The Corporation and the Executive hereby acknowledge that the Corporation
       is entering  into  agreements  similar to this  Restated  Agreement  with
       certain of its other executives and that the Corporation may, at its sole

<PAGE>
                                     -29-


       discretion,  arrange  for one or more  Letters of Credit to  satisfy  its
       responsibilities under this Restated Agreement and such other agreements.
       In the  event  that one  Letter  of Credit is  obtained  to  satisfy  the
       Corporation's  responsibilities under this Restated Agreement and some or
       all of such other agreements,  references to a "Letter of Credit" in this
       Restated  Agreement  shall be read as  references to that portion of such
       Letter  of  Credit  which is  referable  to the  responsibilities  of the
       Corporation to the Executive.

       The Corporation and the Executive also  acknowledge  that the Corporation
       may, at its sole  discretion,  enter into one or more Trust Agreements to
       satisfy its responsibilities under this Restated Agreement and such other
       agreements.  In the event that one Trust  Agreement  is  entered  into to
       satisfy the Corporation's  responsibilities under this Restated Agreement
       and some or all of such other agreements,  references to "Trust",  "Trust
       Agreement",  "Trustee"  and  "Refundable  Tax  Account" in this  Restated
       Agreement  shall be read with such  modifications  as may be necessary in
       the context.

11.12  At the  discretion of the  Corporation  and subject to the  provisions of
       applicable law, in the event that all or a portion of the Obligations are
       funded in  accordance  with  Article 11 hereof and an  actuarial  surplus
       (determined  by actuarial  valuation in accordance  with the terms of the
       report  prepared  as at  the  immediately  preceding  Valuation  Date  in
       accordance  with Section  11.3 of this  Restated  Agreement)  arises as a
       result thereof:

       (a)    all or a  portion  of such  actuarial  surplus  may be used in the
              determination of or to reduce the funding otherwise required to be
              provided by the Corporation hereunder; or

       (b)    any surplus assets may, to the extent that they exceed 110% of the
              amount required to fund that portion of the Obligations  which has
              been  funded  (as  determined  by the  report  prepared  as at the
              immediately  preceding  Valuation Date in accordance  with Section
              11.3 of this Restated Agreement) be returned to the Corporation.


                                  ARTICLE 12
                             EXPEDITED ARBITRATION
                             ---------------------

12.1   If,  pursuant to Section 7.1 of this  Restated  Agreement,  the Executive
       provides  written  notice of the  Executive's  intention to terminate the
       Executive's employment for Good Reason, and the Corporation believes that
       there is no Good Reason, or,  alternatively,  if, pursuant to Section 4.1
       of this Restated  Agreement,  the Corporation  provides written notice of
       its intention to terminate the Executive's  employment for Just Cause and
       the Executive  believes  there is no Just Cause,  the  Corporation or the
       Executive,  as  applicable,  shall,  within ten (10) days of having  been
       provided such notice, provide written notice ("Notice of Dispute") to the
       other Party of the dispute (the "Dispute").

<PAGE>
                                     -30-


12.2   The Parties  agree that any and all Disputes  under  Section 12.1 of this
       Restated Agreement will be resolved by way of a single Arbitrator.

12.3   (a)    Within  fifteen  (15) days of  provision of the Notice of Dispute,
              the Parties shall agree upon and appoint a neutral Arbitrator from
              the then current  roster  maintained by the Alberta  Mediation and
              Arbitration Society to act as Arbitrator of the Dispute; or

       (b)    If no person  acceptable  to both Parties has been agreed upon and
              appointed  within  fifteen  (15) days,  then either Party may make
              immediate  application  to the Court of Queen's  Bench of Alberta,
              Judicial District of Calgary, to have an Arbitrator appointed.

12.4   The Parties  acknowledge and agree that the purpose of this Article 12 is
       to avoid  delays  and  facilitate  resolution  of the  Dispute in a just,
       speedy and cost-effective manner.

12.5   Consistent with the expedited nature of arbitration,  the Arbitrator will
       direct and  control the scope and timing of the  exchange of  information
       between  the  Parties  and will take such steps as the  Arbitrator  deems
       necessary to achieve a just, speedy and cost-effective  resolution of the
       Dispute.  The Arbitrator has the exclusive right and power to resolve all
       issues related to the exchange of information in the arbitration process.

12.6   The Parties  agree that the  Arbitrator  is only  authorized to determine
       whether the Executive  had Good Reason for  terminating  the  Executive's
       employment,  or alternatively,  whether the Corporation had Just Cause to
       terminate the Executive's employment.

12.7   A hearing will occur within  forty-five  (45) days of the  appointment of
       the  Arbitrator  (the  "Hearing").  The time of the Hearing (the "Hearing
       Date") will be scheduled by the Arbitrator  after  consultation  with the
       Parties.  The  Hearing  will  be  governed  by the  rules  set out in the
       Arbitration Act S.A. 1991,  c.A-43,  as modified by the Arbitrator in the
       interests of achieving a just,  speedy and  cost-effective  resolution of
       the Dispute.  The Arbitrator may require  written  submissions of fact in
       the Dispute to be provided seven (7) days before the Hearing Date.

12.8   The Arbitrator will use best efforts to provide a written decision within
       seven (7) days of the conclusion of the Hearing.

12.9   The Parties agree that the decision of the  Arbitrator  will be final and
       binding upon the Parties.

<PAGE>
                                     -31-


                                  ARTICLE 13
                                    GENERAL
                                    -------

13.1   The headings of the Articles and  paragraphs in this  Restated  Agreement
       are  inserted  for  convenience  only and shall not affect the meaning or
       construction of this Restated Agreement.

13.2   This Restated  Agreement shall be construed and interpreted in accordance
       with the laws of the  Province of Alberta and the federal  laws of Canada
       as applicable therein.

13.3   If any provision of this  Restated  Agreement is determined to be void or
       unenforceable  in  whole or in part,  it  shall  be and be  deemed  to be
       severed from this Restated  Agreement  without affecting or impairing the
       validity of any other provision herein.

13.4   Any  notice  required  or  permitted  to be  given  under  this  Restated
       Agreement shall be in writing and shall be properly given if delivered by
       hand delivery or mail or other form of electronic  communication  capable
       of transmission confirmation to the following address:

       a.     IN THE CASE OF THE CORPORATION TO:
              ----------------------------------

              Nexen Inc.
              801 - 7th Avenue S.W.
              Calgary,  AB T2P 3P7
              Attention:  General Manager, Compensation and Benefits

       B.     IN THE CASE OF THE EXECUTIVE TO:
              --------------------------------

              the  last  address  of  the   Executive  in  the  records  of  the
              Corporation  or to such other address as the Parties may from time
              to time specify by notice given in accordance herewith.

13.5   This Restated Agreement shall enure to the benefit of and be binding upon
       the Executive and the Executive's heirs, executors and administrators and
       upon the Corporation and its successors and assigns.

13.6   This Restated Agreement  constitutes the entire agreement relating to the
       respective rights and obligations of the Parties upon the occurrence of a
       Change of Control.  No  amendment  or waiver of this  Restated  Agreement
       shall be binding unless executed in writing by the Parties.

       Notwithstanding the foregoing,

       (a)    any amendment to Article 11 of this Restated  Agreement,  Schedule
              "B-1" or  Schedule  "B-2"  which is  required  to ensure  that the
              balance  remaining  in the Trust after the  required  tax has been
              withheld and remitted to the Canada  Revenue  Agency is sufficient

<PAGE>
                                     -32-

              to  satisfy  the fee  levied  by the Bank in  connection  with the
              issuance  of a Letter  of  Credit  may be made by the  Corporation
              without the prior written approval of the Executive; and

       (b)    the  Corporation  may  amend,  modify or waive  Article 11 of this
              Restated Agreement,  Schedule "B-1" and Schedule "B-2" in whole or
              in part,  at such time and from time to time,  and in such  manner
              and to such extent as it may deem advisable  without obtaining the
              approval  of  the   Executive,   provided  that  such   amendment,
              modification  or waiver,  as the case may be,  does not  adversely
              affect the  securitization  in accordance with the terms hereof of
              those  Obligations  which  have  accrued  up to the  date  of such
              amendment, modification or waiver, as the case may be.

13.7   The Parties agree that the rights,  entitlements  and benefits set out in
       this  Restated  Agreement  to be paid to the  Executive  upon a Change of
       Control  shall be in full  satisfaction  of all  rights of the  Executive
       under applicable law in effect from time to time as a result thereof.

13.8   Neither  Party can waive or shall be deemed to have  waived  any right it
       has under this Restated  Agreement  except to the extent that such waiver
       is in writing.

13.9   Nothing  contained  in this  Restated  Agreement  shall be  construed  as
       limiting the ability of the Corporation to amend, modify or terminate the
       Executive Benefit Plan in whole or in part, at such time and from time to
       time, and in such manner and to such extent as it may deem advisable.

The Parties have  executed  this  Restated  Agreement  effective the date first
written above.


                                          NEXEN INC.


                                          Per: (signed)
                                               --------------------------------


                                          Per: (signed)
                                               --------------------------------



SIGNED, SEALED & DELIVERED
in the presence of


(signed)                                        (signed)
--------------------------                      -------------------------------
WITNESS                                         MARVIN F. ROMANOW


<PAGE>

                                  SCHEDULE "A"
                                  ------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                      EXECUTIVE BENEFIT PLAN ENTITLEMENTS

In order to  receive  the  entitlements  referred  to in the  Article 8 of this
Restated  Agreement,  the Executive shall execute the attached  Release,  fully
releasing  the  Corporation   from  all  further  claims  in  relation  to  the
Executive's  employment or Employment Benefits and the termination thereof upon
payment  of the  remuneration  and  benefits  referred  to in Article 8 of this
Restated Agreement.  The attached Release shall not, however,  require that the
Executive  relinquish  or release any rights to indemnity  which the  Executive
may,  as an officer or director of the  Corporation  or any of its  Affiliates,
Associates  and  Subsidiaries,  have as against the  Corporation  or any of its
Affiliates,  Associates  and  Subsidiaries,  for costs,  charges  and  expenses
reasonably  incurred  by the  Executive  in respect of any civil,  criminal  or
administrative  action or  proceeding to which the Executive is made a party by
reason of being or having been a director or officer of the  Corporation or any
of its Affiliates, Associates and Subsidiaries, where:

      (a)   the Executive  has acted  honestly and in good faith with a view to
            the best  interests of the  Corporation  or any of its  Affiliates,
            Associates and Subsidiaries; and


      (b)   in the case of a criminal or  administrative  action or  proceeding
            enforced  by a  monetary  penalty,  the  Executive  had  reasonable
            grounds for believing the Executive's conduct was lawful.



<PAGE>


                                  FINAL RELEASE
                                  -------------


KNOW  ALL MEN BY THESE  PRESENTS  that I,  MARVIN  F.  ROMANOW,  of the City of
Calgary,  in the Province of Alberta,  in consideration of the amounts provided
in that certain Amended and Restated Agreement Respecting Change of Control and
Executive Benefit Plan Entitlements (the "Restated  Agreement") dated as of the
______ day of  ____________,  2008 between  myself and NEXEN INC. and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged,  do for myself,  my executors and assigns hereby remise,  release
and  forever  discharge  the  Corporation,  and  any  associated,   affiliated,
predecessor  or parent  corporation  of the  Corporation  and their present and
former directors,  officers, agents and employees (the "Releasees"),  including
each of their respective  successors,  heirs,  administrators and assigns, from
all manner of actions, causes of action, debts, obligations,  covenants, claims
or demands,  whatsoever  which I may ever have had, now have, or can,  shall or
may  hereafter  have  against  the  Releasees  or any of them,  by reason of or
arising  out of any  cause,  matter  or thing  whatsoever  done,  occurring  or
existing up to and  including the present date and, in  particular,  without in
any way restricting  the generality of the foregoing,  in respect of all claims
of any nature  whatsoever,  past,  present or future,  directly  or  indirectly
related to or arising out of or in  connection  with my  relationship  with the
Releasees,  as an employee,  officer or  director,  and the  termination  of my
employment  from the  Corporation  including,  but not  limited  to, any claims
related to any  entitlement  I may have or may have had to any payment or claim
either at common law or under the  Employment  Standards  Code,  Human  Rights,
Citizenship  and  Multiculturalism  Act or  any  other  applicable  legislation
governing or related to my employment with the Releasees.


AND FOR THE SAID  CONSIDERATION,  I, MARVIN F.  ROMANOW,  represent and warrant
that I have not assigned to any person, firm or corporation any of the actions,
causes of action, claims, suits,  executions or demands which I release by this
Release,  or with  respect  to which I agree  not to make any claim or take any
proceeding herein.


IT IS FURTHER  ACKNOWLEDGED  that the payment to me includes full  compensation
and  consideration for the loss of my employment  benefits,  as provided by the
Releasees, and that all of my employment benefits and privileges shall cease on
the  date of  termination  of my  employment,  except  as  otherwise  expressly
provided in the Restated Agreement.  I further acknowledge that I have received
all benefits due to me and have no further claim against the Releasees for such
benefits. I further accept sole responsibility to replace such benefits which I

<PAGE>
                                     -2-


wish to continue or to exercise  conversion  privileges  where  applicable with
respect to such benefits and, in  particular  any life  insurance and long-term
disability benefits.  In the event that I become disabled following termination
of my  employment,  I covenant not to sue the  Releasees for insurance or other
benefits  or loss of same and hereby  release  the  Releasees  from any and all
further obligations or liabilities arising therefrom.


Notwithstanding  anything contained herein, this Release shall not extend to or
affect,  or constitute a release of, my right to sue,  claim against or recover
from the  Releasees  and shall not  constitute  an  agreement  to refrain  from
bringing, taking or maintaining any action against the Releasees in respect of:


      (a)   any corporate  indemnity existing by statute,  contract or pursuant
            to any of the constating  documents of the Corporation  provided in
            my favour in respect of my having  acted at any time as a director,
            officer or both of the Corporation;


      (b)   my  entitlement  to any  insurance  maintained  for the  benefit or
            protection of the  directors  and/or  officers of the  Corporation,
            including without  limitation,  directors' and officers'  liability
            insurance; or


      (c)   my entitlement to any amounts or  compensation  due to me under the
            terms of my employment pursuant to the Restated Agreement.


IT IS HEREBY AGREED that the terms of the Restated Agreement and of this Release
will be kept confidential. No party hereto shall communicate any such terms to
any third party under any circumstances whatsoever, excepting any necessary
communication with my legal and financial advisors, as required, on the express
condition that they maintain the confidentiality thereof, and any disclosure
which is required by law, although either party shall be at liberty to disclose
to third parties that a mutually acceptable Release was agreed upon. The
invalidity and unenforceability of any provision of this Release shall not
affect the validity or enforceability of any other provision of this Release,
which shall remain in full force and effect.


<PAGE>
                                     - 3 -


I HEREBY DECLARE that I have read all of this Release, fully understand the
terms of this Release and voluntarily accept the consideration stated herein as
the sole consideration for this Release for the purpose of making a full and
final settlement with the Releasees. I further acknowledge and confirm that I
have been given an adequate period of time to obtain independent legal counsel
regarding the meaning and the significance of the terms herein and the covenants
mutually exchanged.


IT IS HEREBY AGREED THAT as a term of the termination of my employment from the
Corporation, and in consideration of the amount noted above, I hereby resign as
officer and director of the Corporation and its affiliates.


IN  WITNESS  WHEREOF,  I have  hereunto  set my hand and seal this  _____ day of
______________ in the year _________.



--------------------------------
MARVIN F. ROMANOW



--------------------------------
WITNESS (signature)



--------------------------------
WITNESS (print name)


<PAGE>

                                 SCHEDULE "B-1"
                                 --------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS
          METHODOLOGY AND ASSUMPTIONS FOR DETERMINING SETTLEMENT VALUE


PURPOSE

In accordance with the terms of the Restated Agreement, the purpose of this
Schedule "B-1" is to outline the calculation approach such that, after tax has
been paid on a lump sum settlement value, the remaining balance is intended to
be sufficient to provide after-tax monthly payments equivalent to the after-tax
monthly payments the Executive would have received under the terms of the
Executive Benefit Plan as provided for under this Restated Agreement.



OVERVIEW FOR DEFINED BENEFIT PENSION

The following outlines the actuarial methods, assumptions and calculation
process to be used in determining the lump sum settlement value of the defined
benefit pension entitlements under the Executive Benefit Plan when settlement
occurs in accordance with Section 11 of the Restated Agreement. Section 300 of
the Income Tax Regulations establishes the procedure applicable in using an
after-tax lump sum to purchase a prescribed annuity:

1.     A prescribed  annuity payment consists of two components:  (a) the deemed
       capital  element of the annuity  payment on which no tax is payable,  and
       (b) the deemed non-capital  portion of the annuity payment which is taxed
       at the marginal rate.

2.     The capital  portion of each future annuity payment is considered to be a
       return of the original after-tax lump sum amount.

3.     The non-capital portion of each annuity payment is assumed to be provided
       by the  investment  return on the original  after-tax lump sum amount and
       has therefore not yet been taxed.

4.     A constant  percentage of each future payment is deemed to be a return of
       the original lump sum capital.

CALCULATION METHODOLOGY

1.     Equivalent after-tax payments:

a.     Determine  initial gross annual pension  entitlement  under the Executive
       Benefit Plan.

b.     Determine  after-tax  annual  pension  entitlement  under  the  Executive
       Benefit Plan based on Individual Tax Rate as defined in Schedule "B-1".


<PAGE>
                                     - 2 -


c.     Determine the capital element based on the  non-indexed  present value of
       the pension payments divided by life expectancy.

d.     Determine the monthly  payment which provides an after-tax  pension equal
       to the after-tax pension  determined in 1.b. above in accordance with the
       prescribed annuity methodology.

2.     Present value of periodic payments from 1. above:

a.     Determine the present value of the pension determined in 1.d. above using
       the  assumptions  described  below in this  Schedule  "B-1".  For greater
       certainty, the value of the post-retirement indexation is to be reflected
       in determining  the present value of the accrued  pension  entitlement in
       respect  of  post-1992  service,  and any  accrued  pension in respect of
       service granted during the Severance Period.

3.     Tax adjustment:

a.     Gross-up the present value  determined  in 2.a.  above to reflect the tax
       assumed to be required to be paid on the lump sum.

b.     Gross-up the amount  determined in 3.a.  above to reflect the tax assumed
       to be required to be paid on  investment  earnings in respect of the lump
       sum  payment  during  the  deferral   period  prior  to  assumed  pension
       commencement, if any.

4.     Equivalent present value after tax as the after-tax monthly payments:

a.     The amount  determined  in 3.b.  above  shall be the lump sum  settlement
       value of the Executive's pension entitlement.

ASSUMPTIONS

Interest Discount Rate:

--  during deferral period                 Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately  preceding  the  date  of
                                           calculation,  rounded  down  to  next
                                           lower 0.5.

--  after assumed pension commencement     Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately  preceding  the  date  of
                                           calculation,  rounded  down  to  next
                                           lower 0.5,

                                           less


<PAGE>
                                     - 3 -


                                           assumed  escalation of pensions after
                                           retirement.

Increase in Consumer Price Index:          Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately  preceding  the  date  of
                                           calculation,

                                           less

                                           Yield  on  long-term   Government  of
                                           Canada Real Return bonds as published
                                           in  the   Bank  of   Canada   Review,
                                           described  in CANSIM  series  V122553
                                           (or a successor  series) for the last
                                           trading  Wednesday  at the end of the
                                           month immediately  preceding the date
                                           of calculation.

                                           The result of the  difference is then
                                           rounded up to the next highest 0.5% .

Escalation of Pensions After Retirement:   75% of CPI, less 1% (minimum increase
                                           25% of CPI). Applies only to benefits
                                           accrued  for service  after  December
                                           31, 1992.

MORTALITY:

--  for life expectancy                    1994  Uninsured  Pensioner  Mortality
                                           Table  with  mortality   improvements
                                           projected to 15 years beyond the date
                                           of termination.

--  for present values

       o   prior to assumed pension        Nil.
           commencement

       o   after assumed pension           1994  Uninsured  Pensioner  Mortality
           commencement                    Table  with  mortality   improvements
                                           projected 15 years beyond the date of
                                           termination.

Marital Status:                            Actual status at date of termination.

Age of Spouse:                             Based on actual date of birth.


<PAGE>
                                     - 4 -


Individual Tax Rate:                       Maximum individual  marginal tax rate
                                           for employee's province of employment
                                           at the date of termination.


OVERVIEW FOR DEFINED CONTRIBUTION BENEFIT

The Settlement Value for any defined contribution benefits shall be equal to the
DC  Supplemental  Company  Account the Executive  would have received  under the
terms  of the  Executive  Benefit  Plan as  provided  for  under  this  Restated
Agreement. The Settlement Value will not be adjusted for tax.


ASSUMPTIONS

Investment return:                         As the  Settlement  Value is expected
                                           to be payable at the calculation date
                                           no  investment  return is  assumed to
                                           accrue on the DC Supplemental Company
                                           Account as  defined in the  Executive
                                           Benefit Plan.

<PAGE>

                                 SCHEDULE "B-2"
                                 --------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS

METHODOLOGY AND ASSUMPTIONS FOR DETERMINING THE AMOUNT TO BE SECURED OR FUNDED
IN ACCORDANCE WITH SECTION 11 BASED ON THE METHODOLOGY DESCRIBED IN SCHEDULE
"B-1"


PURPOSE

The purpose of this Schedule "B-2" is to provide the actuarial methodology and
assumptions for determining the amount to be secured or funded in accordance
with Section 11 of the Restated Agreement.

METHODOLOGY

The settlement methodology is described in Schedule B-1.

The funding methodology applicable to the Executive Benefit Plan Obligations is
based on the following:

1.     Estimate the accrued pension and/or Supplemental Company Accounts payable
       from the Executive Benefit Plan as at the Valuation Date.

2.     Assume  that  the  assets  of the plan are to be  invested  in long  term
       Government  of  Canada  bonds  and  subject  to the  50%  refundable  tax
       applicable to retirement compensation arrangements.

3.     DC Supplemental  Company Accounts are assumed to be paid as a lump sum as
       at the Valuation Date with no adjustment for tax.

4.     Determine the present value of the amounts in 1 through 3 above.

5.     Estimate the settlement  value that could be paid in accordance  with the
       methodology and assumptions described in Schedule B-1.

6.     The funding amount in respect of the Executive  Benefit Plan  Obligations
       shall be the  greater  of the  amount  determined  in  accordance  with 1
       through 4 above and the amount in 5 above.

ASSUMPTIONS

Interest Discount Rate:

--  during deferral period                 Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately preceding the Anniversary
                                           Date, rounded down to next lower 0.5.

--  after assumed pension commencement     Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading

<PAGE>
                                     - 2 -


                                           Wednesday  at the  end  of the  month
                                           immediately preceding the Anniversary
                                           Date, rounded down to next lower 0.5,
                                           less assumed  escalation  of pensions
                                           after retirement.

Increase in Consumer Price Index:          Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately preceding the Anniversary
                                           Date,

                                           less

                                           Yield  on  long-term   Government  of
                                           Canada Real Return bonds as published
                                           in  the   Bank  of   Canada   Review,
                                           described  in CANSIM  series  V122553
                                           (or a successor  series) for the last
                                           trading  Wednesday  at the end of the
                                           month   immediately   preceding   the
                                           Anniversary Date.

                                           The result of the  difference is then
                                           rounded up to the next highest 0.5%.

Escalation of Pensions After Retirement:   75% of CPI, less 1% (minimum increase
                                           25% of CPI). Applies only to benefits
                                           accrued  for service  after  December
                                           31, 1992.

MORTALITY:

-- for life expectancy                     1994  Uninsured  Pensioner  Mortality
                                           Table  with  mortality   improvements
                                           projected  to  15  years  beyond  the
                                           Calculation Date.

-- for present values

    o   prior to assumed pension           Nil.
        commencement


<PAGE>
                                     - 3 -


    o   after assumed pension             1994  Uninsured  Pensioner  Mortality
        commencement                      Table  with  mortality   improvements
                                          projected   15   years   beyond   the
                                          Calculation Date.

Marital Status:                           Actual status at the Anniversary.

Age of Spouse:                            Based on actual date of birth.

Individual Tax Rate:                      Maximum individual  marginal tax rate
                                          for employee's province of employment
                                          at the Anniversary Date

Bonus:                                    Target  bonus % applied to the salary
                                          rate at the Valuation Date

Investment return:                        Yield  on  long-term   Government  of
                                          Canada bonds as published in the Bank
                                          of Canada Review, described in CANSIM
                                          series   V122544   (or  a   successor
                                          series)   for   the   last    trading
                                          Wednesday  at the  end  of the  month
                                          immediately preceding the Anniversary
                                          Date rounded down to next lower 0.5%,
                                          and then divided by 2

Assumed investment return on              As  published  in the Bank of  Canada
DC Supplemental Company Account           Review,  described  in CANSIM  series
as at the Valuation Date:                 V122544 (or a  successor  series) for
                                          the last trading Wednesday at the end
                                          of the  month  immediately  preceding
                                          the  Anniversary  Date  rounded up to
                                          next highest 0.5%, plus 3.0%

Decrements:                               None assumed prior to Calculation Date

Eligibility for Pensions:                 100% vested

Pension Commencement Age:

--   eligible for subsidized early        Payable  at  the  completion  of  the
     retirement on the Calculation Date   Severance  Period.   Payable  at  the
     (i.e., age 55 and 10 years of        Calculation   Date  for  purposes  of
     continuous service)                  determining the amount required under
                                          Section 11.6(e).

--   not eligible for early retirement    Deferred  to age 60 or the end of the
     on the Calculation Date              Severance Period if later. Payable at
                                          age 60 for  purposes  of  determining
                                          the  amount  required  under  Section
                                          11.6(e).

Fluctuation reserve (1)                   15% of the pension obligations


<PAGE>
                                     - 4 -


Cost of borrowing to settle the            Yield  on  one  month  Government  of
obligations:                               Canada Treasury Bills as published in
                                           the Bank of Canada Review,  described
                                           in  CANSIM   series   V122529  (or  a
                                           successor   series)   for  the   last
                                           trading  Wednesday  at the end of the
                                           month   immediately   preceding   the
                                           Anniversary  Date,  rounded up to the
                                           next higher 0.25%, plus 1.50%



================================================================================

Notes:

(1)    Referred to by Section 11.5(g), Section 11.6(e)(viii) and 11.6(e)(x). The
       15% load is intended to provide a reserve for a potential decrease in the
       Interest  Discount Rate in combination  with  potential  increases in the
       Consumer Price Index for an aggregate change of 1.0%.


<PAGE>

                                  SCHEDULE "C"
                                  ------------

           AMENDED AND RESTATED AGREEMENT RESPECTING CHANGE OF CONTROL
                    AND EXECUTIVE BENEFIT PLAN ENTITLEMENTS
                    ESTIMATED(1) ENTITLEMENT TO COMPENSATION
                 PURSUANT TO ARTICLE 8 OF THE RESTATED AGREEMENT


--------------------------------------------------------------------------------
Employee - Marvin F. Romanow
--------------------------------------------------------------------------------
Base Salary (36 months) (2)                                          $1,830,000
--------------------------------------------------------------------------------
Bonus Target Value                                                   $1,098,000
--------------------------------------------------------------------------------
Benefits Uplift                                                        $237,900
--------------------------------------------------------------------------------
Car Allowance                                                           $57,600
--------------------------------------------------------------------------------
Savings Plan                                                           $109,800
--------------------------------------------------------------------------------
Financial Counselling Services                                          $10,500
--------------------------------------------------------------------------------
Security Monitoring Services                                             $2,400
--------------------------------------------------------------------------------

TOTAL VALUE                                                          $3,346,200
--------------------------------------------------------------------------------

Additional Lump Sum Settlement Value of Pension(3)                   $4,650,031
--------------------------------------------------------------------------------

TOTAL ESTIMATED ENTITLEMENT                                          $7,996,231
--------------------------------------------------------------------------------

In addition to the above,  Section 8.1(d) of the Restated Agreement provides for
Executive  Outplacement  counselling  to be provided  by a firm  selected by the
Executive, at a cost to the Corporation not to exceed $25,000.

IN ADDITION to the above pension entitlement under the Agreement,  the Executive
has the following  pension  entitlements  under the Defined  Benefit  Registered
Pension Plan and  Executive  Benefit Plan. As is the case with the figures shown
above,  these  values  are  estimated  values  (as of April 1, 2008) and are for
illustrative  purposes only.  Actual values will be calculated as of the date of
the  entitlement or payment in accordance  with the Defined  Benefit  Registered
Pension Plan and the Executive Benefit Plan, respectively,  and therefore may be
subject to change.  Pension  entitlements in respect of the Defined Contribution
Registered Pension Plan and the Defined Contribution  provision of the Executive
Benefit Plan are not included in the pension amounts presented below.

o     Accrued Annual Defined Benefit Pension Entitlement                $25,083
      (Registered Pension Plan)(4)

o     Estimated Lump Sum Transfer Value of Registered                   $305,710
      Pension Plan(5)

o     Estimated Lump Sum Value of Executive Benefit Plan(5)          $3,882,442


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

(1)   As stated in Section 8.1 of the Restated Agreement, the above calculations
      represent  only the current  estimated  value (as of April 1, 2008) of the
      Executive's   entitlement  to  compensation  upon  a  Change  of  Control.
      Accordingly, the above calculations are for illustrative purposes only.

(2)   For purposes of Section 5.1 of the Restated Agreement, all calculations of
      the Executive's  entitlement to compensation upon a Change of Control will
      be based on a Severance Period of 30 months.

(3)   Calculated in accordance with Section 8.1(b) of the Restated Agreement.

      -   Adjustment to EBP lump sum value to reflect settlement $2,474,420.

      -   Additional  settlement  value of pension  accrued during the severance
          period upon a change of control $2,175,611.

(4)   Deferred benefit payable from age 60.

(5)   Based on the Standards of Practice for Determining Pension Commuted Values
      approved by the Canadian Institute of Actuaries using rates applicable for
      April 2008 terminations.

<PAGE>

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS

This amended and restated  agreement  respecting change of control and executive
benefit plan entitlements made as of the 18th day of August, 2008.


BETWEEN:

                    NEXEN INC., a corporation  incorporated  under the
                    laws of Canada

                                  (hereinafter referred to as the "Corporation")

                                     - and -

                    LAURENCE MURPHY

                                    (hereinafter referred to as the "Executive")

RECITALS:

1.     The Executive, as Executive Vice President,  International Oil and Gas of
       the  Corporation,  is considered by the Board to be an essential  officer
       and employee of the  Corporation,  who is both  integral to the operation
       and development of the Corporation,  and has acquired outstanding skills,
       unique experience and possesses an extensive background in, and knowledge
       of, the Corporation's  business,  operations and the industry in which it
       is engaged.

2.     In the  event of a Change of  Control,  there is a  possibility  that the
       employment  of the Executive  would be  terminated  without just cause or
       adversely modified and the Executive has expressed concern in that regard
       to the Corporation.

3.     The Board  recognizes  that it is essential and in the best  interests of
       the Corporation  and its  shareholders  that the  Corporation  retain the
       continued  dedication of the Executive to the Executive's  office and the
       Executive's  employment  during the uncertain period prior to, during and
       following a Change of Control.

4.     The Board further believes that the past service of the Executive and the
       Executive's  integral  role  in  the  development  and  operation  of the
       Corporation  requires that the Corporation  ensure that in the event of a
       Change of Control  the  Executive  is  treated in a manner  that is fair,
       reasonable,  consistent with industry standards and in the best interests
       of the Corporation.

5.     The  Corporation  and the  Executive  entered  into a Change  of  Control
       Agreement on October 22, 1999, which was amended by an Amending Agreement
       dated December 25, 2000 (collectively the "Original  Agreement") to agree
       on the terms  and  conditions  which  would  govern  the  termination  or
       modification  of the  employment of the  Executive  following a Change of
       Control.


<PAGE>
                                     - 2 -


6.     The Original  Agreement  was replaced  and  superseded  by an Amended and
       Restated Change of Control  Agreement in December 2001, which was amended
       by an Amending Agreement dated May 30, 2003  (collectively,  the "Current
       Agreement")  which,  among  other  matters,  detailed  the  Corporation's
       security  and  funding  obligations  in  respect of the Change of Control
       Obligations (as hereinafter defined), provided for the securitization and
       funding  of  the  Executive  Benefit  Plan  Obligations  (as  hereinafter
       defined) and provided for the cessation of the Executive's coverage under
       the Statement of Company Procedure  Regarding the Securitization of Nexen
       Inc. Restated Executive Benefit Plan, as amended or replaced from time to
       time (the "Securitization Procedure").

7.     The Corporation and the Executive wish to amend the Current  Agreement as
       herein  provided and, in doing so, wish to restate the Current  Agreement
       as herein amended (the "Restated Agreement").

NOW THEREFORE, in consideration of the mutual covenants and agreements set forth
in this Restated  Agreement and for other good and valuable  consideration,  the
receipt and  sufficiency of which are hereby  acknowledged  by the Parties,  the
Parties agree as follows:

                                    ARTICLE 1
                                   DEFINITIONS
                                   -----------

1.1    In this Restated Agreement, the following terms shall mean as follows:

       (a)    "ACTING  JOINTLY OR IN CONCERt" for the purposes of this  Restated
              Agreement,  a Person is acting  jointly or in concert with another
              Person  if  such  Person  has  any   agreement,   arrangement   or
              understanding  (whether  formal or informal  and whether or not in
              writing)  with such  other  Person for the  purpose of  acquiring,
              offering  to  acquire,   or  voting  any  Common   Shares  of  the
              Corporation  (other  than  customary  agreements  with and between
              underwriters  and  banking  group or selling  group  members  with
              respect to a  distribution  of  securities by way of prospectus or
              private  placement  or pursuant to a pledge of  securities  in the
              ordinary course of business).

       (b)    "ACTUARY"  has the  meaning  referred  to in Section  10.2 of this
              Restated Agreement.

       (c)    "AFFILIATE"  and  "ASSOCIATE"  have the  meaning  ascribed to such
              terms in National Instrument 45-106.

       (d)    "ANNIVERSARY  DATE" has the meaning referred to in Section 10.3 of
              this Restated Agreement.


<PAGE>
                                     - 3 -


       (e)    "ANNUAL BASE SALARY" means the annual base salary of the Executive
              payable  by the  Corporation  at the end of the month  immediately
              preceding the Date of Termination.

       (f)    "ANNUAL TARGET BONUS" means the Executive's annual target bonus as
              determined  by the Board to be in effect for the calendar  year in
              which a Change of Control occurs.

       (g)    "Bank"  has  the  meaning  referred  to in  Section  10.2  of this
              Restated Agreement.

       (h)    "BENEFICIAL OWNER" for the purposes of this Restated Agreement,  a
              Person  shall be deemed to be the  "BENEFICIAL  OWNER" and to have
              "BENEFICIAL OWNERSHIP" of and to "BENEFICIALLY OWN":

              (i)    any  securities  as to  which  such  Person  or any of such
                     Person's Affiliates or Associates is the owner at law or in
                     equity;

              (ii)   any  securities  as to  which  such  Person  or any of such
                     Person's  Affiliates or  Associates  has a right to acquire
                     (i) upon the exercise of any Convertible Securities or (ii)
                     pursuant to any agreement,  arrangement  or  understanding,
                     whether  such  right is  exercisable  immediately  within a
                     period of sixty (60) days  thereafter and whether or not on
                     condition or the happening of any contingency,  (other than
                     (a) customary  agreements with and between underwriters and
                     banking group and selling group members with respect to the
                     distribution  to  the  public  or  pursuant  to  a  private
                     placement  of  securities,  or (b)  pursuant to a pledge of
                     securities in the ordinary course of business); and

              (iii)  any  securities  which are  Beneficially  Owned  within the
                     meaning  of  clauses  (a) or (b) above by any other  Person
                     with which such Person is Acting Jointly or in Concert,

              provided,   however,  that  a  Person  shall  not  be  deemed  the
              "Beneficial  Owner"  or to have  "Beneficial  Ownership"  of or to
              "Beneficially   Own"  any  security   where  such  Person  is  the
              registered  holder of  securities  as a result of  carrying on the
              business of or acting as nominee for a securities depository.

              For purposes of this Restated Agreement,  the percentage of Common
              Shares Beneficially Owned by any Person, shall be and be deemed to
              be the product determined by the formula:

              100 x A/B

              Where:

              A  =  the  number  of  votes  for the  election  of all  directors
                    generally  attaching to the Common Shares Beneficially Owned
                    by such Person; and


<PAGE>
                                     - 4 -


              B  =  the  number  of  votes  for the  election  of all  directors
                    generally attaching to all outstanding Common Shares.

              For  the  purposes  of  the  foregoing  formula,  where  a  Person
              Beneficially  Owns  unissued  Common  Shares which may be acquired
              pursuant to  Convertible  Securities,  such Common Shares shall be
              deemed  to be  outstanding  for the  purpose  of  calculating  the
              percentage of Common Shares  Beneficially  Owned by such Person in
              both the  numerator  and the  denominator,  but no other  unissued
              Common  Shares  which  may  be  acquired  pursuant  to  any  other
              outstanding Convertible Securities shall, for the purposes of that
              calculation, be deemed to be outstanding.

       (i)    "BOARD"  means  the  Board  of  Directors  of the  Corporation  as
              constituted from time to time.

       (j)    "CBCA" means the Canada Business Corporations Act, as amended from
              time to time, and any successor legislation thereto.

       (k)    "CALCULATION  DATE" has the meaning referred to in Section 10.5 of
              this Restated Agreement.

       (l)    "CHANGE OF CONTROL" means the occurrence of any of:

              (i)    the  purchase  or  acquisition  of  any  Common  Shares  or
                     Convertible  Securities by a Beneficial Owner which results
                     in the Beneficial  Owner owning,  or exercising  control or
                     direction  over,  Common Shares or  Convertible  Securities
                     such that,  assuming  only the  conversion  of  Convertible
                     Securities  Beneficially  Owned or over  which  control  or
                     direction  is  exercised  by  the  Beneficial   Owner,  the
                     Beneficial   Owner  would  own,  or  exercise   control  or
                     direction  over,  Common Shares  carrying the right to cast
                     more than thirty-five  percent (35%) of the votes attaching
                     to all Common Shares; or

              (ii)   the  substantial   completion  of:  (i)  the   liquidation,
                     dissolution or winding-up of the  Corporation;  or (ii) the
                     sale,  lease or other  disposition of all or  substantially
                     all of the assets of the Corporation; or

              (iii)  a situation  in which  individuals  who were members of the
                     Board immediately prior to:

                     (A)    a meeting  of the  shareholders  of the  Corporation
                            involving  a  contest  for,  or an item of  business
                            relating to, the election of directors; or

                     (B)    an  amalgamation,   arrangement,   merger  or  other
                            consolidation or combination of the Corporation with
                            another Person,


<PAGE>
                                     - 5 -


                     shall not constitute a majority of the Board following such
                     election or transaction; or

              (iv)   the completion of any  transaction or the first of a series
                     of transactions which would have the same or similar effect
                     as any transaction or series of transactions referred to in
                     paragraphs (i), (ii) or (iii) above; or

              (v)    a determination by the Board that, for the purposes of this
                     Restated Agreement,  a Change of Control has occurred or is
                     imminent.

       (m)    "CHANGE OF CONTROL OBLIGATIONS" means the Company's obligations to
              make  the lump  sum  payments  described  in  Section  7.1 of this
              Restated Agreement to the Executive.

       (n)    A "CHANGE OF CONTROL  OBLIGATIONS  -  DESIGNATED  EVENT"  shall be
              deemed to have occurred if:

              (i)    the  Corporation  fails to  arrange  for the  extension  or
                     replacement  of a Letter of Credit in  accordance  with the
                     terms of this Restated Agreement; or

              (ii)   the Executive's employment is terminated in accordance with
                     Section 5.1 or 6.1 of this Restated Agreement.

       (o)    "COMMON SHARES" means the common shares of the Corporation.

       (p)    "CONVERTIBLE SECURITIES" means:

              (i)    any right  (contractual  or  otherwise  and  regardless  of
                     whether  such  right  constitutes  a  security)  to acquire
                     Common Shares from the Corporation; or

              (ii)   any security  issued by the  Corporation  from time to time
                     (other than the rights issued  pursuant to a  shareholders'
                     rights  protection  plan,  if any)  carrying any  exercise,
                     conversion or exchange right,

              which is then exercisable or exercisable  within a period of sixty
              (60) days from that time pursuant to which the holder  thereof may
              acquire Common Shares or other  securities  which are  convertible
              into or  exercisable  or  exchangeable  for Common Shares (in each
              case, whether such right is then exercisable or exercisable within
              a period of sixty  (60) days from that time and  whether or not on
              condition or the happening of any contingency).

       (q)    "DATE OF  TERMINATION"  means the date upon which the  Executive's
              employment  is  terminated  pursuant to Section 4.1, 5.1 or 6.1 of
              this  Restated  Agreement.   For  greater  clarity,  the  Date  of
              Termination means the date upon which the Corporation provides the
              Executive   with   written,   verbal  or  other  notice  that  the
              Executive's  employment has been or will be terminated pursuant to

<PAGE>
                                     - 6 -


              Section  4.1 or 5.1 of this  Restated  Agreement  or the date upon
              which the Executive  provides the Corporation  with written notice
              terminating the Executive's  employment pursuant to Section 4.1 or
              for Good Reason pursuant to Section 6.1.

       (r)    "DISABILITY"  means,  where due to a physical or mental condition,
              the  Executive  is  rendered  totally  and  permanently  unable to
              perform the Executive's duties for a consecutive period of two (2)
              years or more during  which the  Executive  has been in receipt of
              long term disability insurance benefits from the insurance carrier
              normally utilized by the Corporation.

       (s)    "DISPUTE"  has the  meaning  referred  to in Section  11.1 of this
              Restated Agreement.

       (t)    "EFFECTIVE  DATE"  means the date upon  which a Change of  Control
              occurs.

       (u)    "EMPLOYMENT  BENEFITS" means the employment  benefits to which the
              Executive  is entitled by virtue of any  written,  oral or implied
              agreement with the Corporation.  For the purposes of this Restated
              Agreement, "Employment Benefits" shall include, but is not limited
              to, the following:

              (i)    the  Executive's  entitlement  to  any  dental  or  general
                     medical care;

              (ii)   the Executive's entitlement to receive long term disability
                     benefits from the insurance  carrier  normally  utilized by
                     the Corporation;

              (iii)  the Executive's  entitlement to pension  benefits under the
                     terms of any pension plan with the Corporation;

              (iv)   the Executive's entitlement to a monthly car allowance from
                     the Corporation;

              (v)    the  Executive's   entitlement  to   contributions  by  the
                     Corporation to the Corporation's savings plan;

              (vi)   the Executive's entitlement to receive from the Corporation
                     financial counseling  services,  at a cost of $3,500.00 per
                     year (or as the same may be increased  from time to time by
                     the Corporation); and

              (vii)  the Executive's entitlement to receive from the Corporation
                     security  monitoring  services at the Executive's  personal
                     residence.

       (v)    "EXECUTIVE  BENEFIT  PLAN" has the meaning  referred to in Section
              7.1(b) of this Restated Agreement.

       (w)    "EXECUTIVE  BENEFIT  PLAN  OBLIGATIONS"  means  the  Corporation's
              outstanding  obligations  under the Executive  Benefit Plan to the
              Executive.


<PAGE>
                                     - 7 -


       (x)    An "EXECUTIVE  BENEFIT PLAN OBLIGATIONS - DESIGNATED  EVENT" shall
              be deemed to have occurred if:

              (i)    a Change of Control occurs;

              (ii)   the  Corporation  makes an  assignment  for the  benefit of
                     creditors  or files a  petition  in  bankruptcy  or becomes
                     insolvent or bankrupt;

              (iii)  a receiver, trustee or liquidator of or for the Corporation
                     is appointed and is not discharged within a period of sixty
                     days;

              (iv)   the net worth of the Corporation,  described as shareholder
                     equity  in the  consolidated  financial  statements  of the
                     Corporation  as  disclosed  in  the  annual  and  quarterly
                     consolidated  financial  statements of the Corporation,  is
                     less than $400 million;

              (v)    the  Corporation  fails to  arrange  for the  extension  or
                     replacement  of a Letter of Credit in  accordance  with the
                     terms of this Restated Agreement;

              (vi)   the  Executive  has provided  written  notification  to the
                     Trustee  and  to the  Corporation  of  the  failure  by the
                     Corporation  to pay any amount owed to or in respect of the
                     Executive  under the  Executive  Benefit Plan within thirty
                     days of the due date  specified  in the  Executive  Benefit
                     Plan  (together  with a  statement  of the  amount  due and
                     owing) either to the person  entitled  thereto  pursuant to
                     the  Executive  Benefit Plan or to the Trust in  accordance
                     with the provisions of Section 10.6(h); or

              (vii)  at any time the Board  adopts a  resolution  to the  effect
                     that, for purposes of this Restated Agreement, an Executive
                     Benefit Plan Obligations - Designated Event has occurred or
                     is imminent.

       (y)    "GOOD  REASON"  means any of the  following,  unless the Executive
              shall have given the Executive's express written consent thereto:

              (i)    INCONSISTENT DUTIES. The assignment to the Executive of any
                     duties  inconsistent  with  the  Executive's  status  as an
                     executive   officer  of  the   Corporation  or  a  material
                     alteration  in the  nature  or  status  of the  Executive's
                     responsibilities  or duties or reporting  relationship from
                     those in effect immediately prior to a Change of Control;

              (ii)   REDUCED  SALARY.  A  reduction  by the  Corporation  in the
                     Executive's  Annual Base Salary in effect on the  Effective
                     Date or as the same may be increased  thereafter  from time
                     to time or the  failure  by the  Corporation  to grant  the
                     Executive salary increases at a rate  commensurate with the
                     increases accorded to other executives of the Corporation;


<PAGE>
                                     - 8 -


              (iii)  RELOCATION.  The Corporation  requiring the Executive to be
                     based  anywhere  other than where the Executive is based at
                     the time a Change of Control  occurs,  except for  required
                     travel  on  the   Corporation's   business   to  an  extent
                     substantially  consistent  with  the  Executive's  business
                     travel  obligations  in the  ordinary  course  of  business
                     immediately prior to a Change of Control;

              (iv)   INCENTIVE   COMPENSATION   PLANS.   The   failure   by  the
                     Corporation   to   continue   in   effect   any   incentive
                     compensation  plan in  which  the  Executive  participates,
                     including,  but not limited to, the Incentive  Compensation
                     Plan or the Stock  Option Plan or any other  similar  plans
                     adopted prior to a Change of Control,  unless the Executive
                     is  eligible  to  participate  in, and is  entitled  to the
                     opportunity  to  receive  a  comparable  level of  benefits
                     under, an ongoing, substitute or alternative plan (it being
                     understood  that the  manner or method of  payment  and the
                     form of  consideration  need not be the same as  existed in
                     the original  plans);  or the failure by the Corporation to
                     continue the Executive's  participation therein on at least
                     as  favourable  a basis,  both in terms  of the  amount  of
                     benefits  available to the  Executive  and the level of the
                     Executive's  participation  relative to other participants,
                     as existed at the time a Change of Control occurs;

              (v)    EMPLOYMENT  BENEFITS  AND  PERQUISITES.  The failure by the
                     Corporation  to  continue  to provide  the  Executive  with
                     Employment Benefits at least as favourable as those enjoyed
                     by the Executive  immediately prior to a Change of Control,
                     including any pension plan,  benefit plan or any retirement
                     arrangement  established  for the Executive,  or any of the
                     Corporation's life insurance, medical, health and accident,
                     disability  or  savings  plans in which the  Executive  was
                     participating  at the time a Change of Control occurs;  the
                     taking of any action by the Corporation that would directly
                     or  indirectly  materially  reduce  any  such  benefits  or
                     deprive the Executive of any material perquisite enjoyed by
                     the  Executive  at the time a  Change  of  Control  occurs,
                     including, without limitation and to the extent applicable,
                     the use of a car, aircraft,  secretarial  services,  office
                     space,    telephones,    computer    facilities,    expense
                     reimbursement, financial counselling, and professional fees
                     and  club  dues  reimbursement;   or  the  failure  by  the
                     Corporation  to provide  the  Executive  with the number of
                     paid  vacation  days to which the  Executive is entitled in
                     accordance with the Corporation's  normal vacation practice
                     in effect at the time a Change of Control occurs;

              (vi)   NO ASSUMPTION BY SUCCESSOR.  The failure of the Corporation
                     to obtain a  satisfactory  agreement  from a  successor  to
                     assume  and  agree  to  perform  this  Restated  Agreement.
                     Alternatively, if the business or undertaking in connection
                     with  which  the   Executive's   services  are  principally
                     performed  is sold at any time  after a Change  of  Control

<PAGE>
                                     - 9 -


                     occurs, and the Executive's  employment is transferred as a
                     result,  the  failure or refusal of the  purchaser  of such
                     business or  undertaking  to provide the Executive with the
                     same or a comparable  position,  duties,  compensation  and
                     benefits, as described in paragraphs (iv) and (v) above, as
                     provided to the  Executive by the  Corporation  immediately
                     prior to a Change of Control;

              (vii)  DISPOSITION OF "ALL OR SUBSTANTIALLY  ALL". The disposition
                     by  the  Corporation  of all  or  substantially  all of the
                     assets  of  the   Corporation,   as  contemplated   herein,
                     notwithstanding  that the Executive's services were or were
                     not principally performed for such business.

       (z)    "HEARING"  has the  meaning  referred  to in Section  11.7 of this
              Restated Agreement.

       (aa)   "HEARING DATE" has the meaning referred to in Section 11.7 of this
              Restated Agreement.

       (bb)   "INCENTIVE   COMPENSATION  PLAN"  means  any  bonus  or  incentive
              compensation  plan of the  Corporation  in which the  Executive is
              entitled to receive benefits in the month immediately  preceding a
              Change of Control.

       (cc)   "JUST CAUSE" means:

              (i)    the failure by the Executive to  substantially  perform the
                     Executive's   duties   according   to  the   terms  of  the
                     Executive's  employment in existence immediately prior to a
                     Change  of  Control  after  the  Corporation  has given the
                     Executive   reasonable   notice  of  such   failure  and  a
                     reasonable opportunity to correct it; or

              (ii)   where  the  Executive   engages  in  any  criminal  act  or
                     dishonesty  resulting  or intended  to result,  directly or
                     indirectly,  in the personal  gain of the  Executive at the
                     Corporation's expense.

       (dd)   "LETTER OF CREDIT" has the meaning  referred to in Section 10.2 of
              this Restated Agreement.

       (ee)   "MONTHLY  BASE  SALARY"  means the monthly  salary  payable to the
              Executive  by the  Corporation  in  effect at the end of the month
              immediately preceding the Effective Date.

       (ff)   "NOTICE OF DISPUTE" has the meaning referred to in Section 11.1 of
              this Restated Agreement.

       (gg)   "OBLIGATIONS"   means,   collectively,   the   Change  of  Control
              Obligations and the Executive Benefit Plan Obligations.


<PAGE>
                                     - 10 -


       (hh)   "PARTIES" means the Corporation,  and its successors and permitted
              assigns,  and the Executive and the Executive's  heirs,  executors
              and administrators and "PARTY" means either one of them.

       (ii)   "PERSON" includes an individual,  partnership,  association,  body
              corporate, trustee, executor, administrator,  legal representative
              and any national, provincial, state or municipal government or any
              agency thereof.

       (jj)   "REFUNDABLE   TAX  ACCOUNT"   means  the  refundable  tax  account
              maintained in respect of the Trust by the Canada Revenue Agency.

       (kk)   "REGISTERED  PENSION PLAN" has the meaning  referred to in Section
              7.1(b) of this Restated Agreement.

       (ll)   "RESTATED  AGREEMENT"  means this amended and  restated  agreement
              respecting   change  of  control  and   executive   benefit   plan
              entitlements as it may be amended,  restated or supplemented  from
              time to time, and the expressions  "hereof",  "herein",  "hereto",
              "hereunder",  "hereby",  and  similar  expressions  refer  to this
              Restated  Agreement  and,  unless  otherwise  indicated,  refer to
              Articles or Sections in this Restated Agreement only.

       (mm)   "SECURITIZATION  PROCEDURE"  has the  meaning  referred  to in the
              recitals of this Restated Agreement.

       (nn)   "SEVERANCE  PERIOD" means the thirty (30) month period immediately
              following the Date of Termination.

       (oo)   "STOCK  OPTION  PLAN" means any stock  option plan or plans of the
              Corporation  pursuant to which the Executive is granted options by
              the Corporation to acquire Common Shares.

       (pp)   "SUBSIDIARY" has the meaning ascribed to it in the CBCA.

       (qq)   "TAX ACT" means the Income Tax Act  (Canada)  and the  Regulations
              thereunder, both as amended from time to time.

       (rr)   "TERM" has the meaning referred to in Section 3.1 of this Restated
              Agreement.

       (ss)   "TRUST"  has  the  meaning  referred  to in  Section  10.1 of this
              Restated Agreement.

       (tt)   "TRUST  AGREEMENT" has the meaning  referred to in Section 10.1 of
              this Restated Agreement.

       (uu)   "TRUSTEE"  means CIBC  Mellon  Trust  Company or such other  trust
              company duly incorporated under the laws of Canada or any province
              thereof  whom  the  Company  may   designate  as  the  trustee  in
              connection with the security and funding of the Obligations.


<PAGE>
                                     - 11 -


       (vv)   "VALUATION  DATE" has the meaning  referred to in Section  10.3 of
              this Restated Agreement.


                                   ARTICLE 2
                           SCOPE OF RESTATED AGREEMENT
                           ---------------------------

2.1    The  Parties  intend  that  this  Restated  Agreement  sets out (a) their
       respective  rights and  obligations  upon the  occurrence  of a Change of
       Control  and in  connection  with the  securitization  and funding of the
       Change of  Control  Obligations;  and (b)  their  respective  rights  and
       obligations  regarding  the  securitization  and funding of the Executive
       Benefit Plan  Obligations.  This Restated  Agreement does not provide for
       any  other  terms of the  Executive's  employment  with the  Corporation,
       except as expressly provided for herein.

2.2    The Parties hereby confirm that except as otherwise  expressly  stated in
       this Restated Agreement, insofar as the securitization and funding of the
       Executive  Benefit  Plan  Obligations  is  concerned,  the  terms of this
       Restated  Agreement  shall  govern  and the  terms of the  Securitization
       Procedure shall not be applicable.

2.3    This Restated Agreement shall  automatically  terminate upon the death of
       the  Executive  or where  due to the  Disability  of the  Executive,  the
       Executive is materially  incapacitated  from  performing the  Executive's
       duties.  In the event of the death or  Disability of the  Executive,  the
       Executive (or the  Executive's  estate) shall be entitled to receive from
       the  Corporation  all unpaid  Annual Base  Salary,  Employment  Benefits,
       unpaid business expenses and vacation  entitlement accrued to the date of
       the  death  or  Disability  of  the  Executive.  The  Executive  (or  the
       Executive's  estate)  shall also be entitled to receive any and all death
       or Disability benefits in a manner consistent with, and at least equal in
       amount to, those  provided by the  Corporation  to senior  executives (or
       their  estate)  under such plans,  programs and policies in effect at the
       date of Disability or death of the Executive,  and the Corporation  shall
       have no further  obligations to the Executive or the  Executive's  estate
       under this Restated Agreement.  Any entitlements of the Executive (or the
       Executive's  estate)  under  the  Executive  Benefit  Plan  which  remain
       following the  termination  of this Restated  Agreement  pursuant to this
       Section 2.3 shall then  commence to be covered  under the  Securitization
       Procedure.

2.4    If the  Executive's  employment is  terminated  by either Party,  for any
       reason,  prior to a Change of Control in any manner, other than expressly
       provided for in this Restated  Agreement,  this Restated  Agreement shall
       automatically  terminate  and  the  Corporation  shall  have  no  further
       obligations to the Executive hereunder. Any remaining entitlements of the
       Executive  under the  Executive  Benefit Plan which remain  following the
       termination of this Restated Agreement pursuant to this Section 2.4 shall
       then commence to be covered under the Securitization Procedure.

<PAGE>
                                     - 12 -


                                   ARTICLE 3
                           TERM OF RESTATED AGREEMENT
                           --------------------------

3.1    Subject to  termination of this Restated  Agreement  prior to a Change of
       Control,  this  Restated  Agreement  shall  remain in effect for a period
       concluding  twelve (12) months following the Effective Date (the "Term"),
       at which time this Restated  Agreement shall terminate;  provided however
       that the payment of compensation and benefits to the Executive under this
       Restated  Agreement  shall  continue  beyond  the  end  of  the  Term  in
       accordance with the applicable provisions of this Restated Agreement. Any
       remaining  entitlements of the Executive under the Executive Benefit Plan
       which  remain  following  the  termination  of  this  Restated  Agreement
       pursuant to this Section 3.1 shall then  commence to be covered under the
       Securitization Procedure.


                                   ARTICLE 4
            TERMINATION FOR JUST CAUSE OR FOR OTHER THAN GOOD REASON
            --------------------------------------------------------

4.1    If the  Executive's  employment  is  terminated  for  Just  Cause,  or is
       terminated  by the  Executive,  other than for Good  Reason,  following a
       Change of Control,  the  Corporation  shall pay to the Executive,  if not
       already  paid,  the  fraction of the unpaid  Annual  Base Salary  accrued
       during the then  current  fiscal  year of the  Corporation,  all  accrued
       Employment  Benefits,  all unpaid  reasonable  business  expenses and all
       unpaid  vacation pay accrued up to and including the Date of Termination,
       and thereafter,  the Corporation shall have no further obligations to the
       Executive under this Restated Agreement.

4.2    Nothing in this  Restated  Agreement  shall  serve to  derogate  from the
       vested rights of the Executive to pension benefits, Stock Option Plans or
       any other  Employment  Benefits to which the  Executive is entitled up to
       the Date of Termination.


                                   ARTICLE 5
                           TERMINATION BY CORPORATION
                           --------------------------

5.1    If the Executive's employment is terminated by the Corporation within the
       twelve (12) month period  following the Effective  Date, for reason other
       than Just Cause,  death or Disability,  the Corporation  shall pay to the
       Executive  the  remuneration  referred  to in Article 7 of this  Restated
       Agreement.


                                   ARTICLE 6
                           TERMINATION FOR GOOD REASON
                           ---------------------------

6.1    In the event of a Change of Control, the Executive may, within the twelve
       (12) month period  following  the Effective  Date and upon  providing the
       Corporation with ten (10) days written notice,  terminate the Executive's
       employment with the Corporation for Good Reason. Upon being provided with
       such notice,  the Corporation shall pay to the Executive the remuneration
       referred to in Article 7 of this Restated Agreement.

<PAGE>
                                     - 13 -


                                   ARTICLE 7
                          COMPENSATION UPON TERMINATION
                          -----------------------------

7.1    If the  Executive's  employment is terminated in accordance  with Section
       5.1 or 6.1 of this Restated Agreement:

       (a)    the Corporation shall forthwith,  but in any event within ten (10)
              days from receipt by the Corporation of a Release  executed by the
              Executive  substantially  in the form of Schedule  "A", pay to the
              Executive:

              (i)    if not  previously  paid,  that portion of the  Executive's
                     accrued but unpaid  Monthly  Base  Salary,  any accrued but
                     unpaid  bonus to which the  Executive  is entitled  for the
                     preceding  calendar year under any  Incentive  Compensation
                     Plan,  all  unpaid  reasonable  business  expenses  and all
                     accrued  but unused  vacation  pay earned or payable to the
                     Executive  by the  Corporation  for  the  period  from  the
                     beginning of the Corporation's then current fiscal year, up
                     to and including the Date of Termination;

              (ii)   a lump sum cash payment  equal to the  Executive's  Monthly
                     Base  Salary  and  one-twelfth  (1/12)  of the  Executive's
                     Annual Target Bonus for each month of the Severance Period;

              (iii)  a lump sum payment  equal to thirteen  percent (13%) of the
                     Executive's  Annual  Base Salary for the  Severance  Period
                     representing  the value of the  group  health  and  welfare
                     benefits for the Severance Period;

              (iv)   a  lump  sum   payment   representing   the  value  of  the
                     Executive's monthly car allowance for the Severance Period;

              (v)    a  lump  sum   payment   representing   the  value  of  the
                     Corporation's  contributions to the  Corporation's  savings
                     plan  (at a rate of six  percent  (6%)  of the  Executive's
                     Annual Base Salary) for the Severance Period;

              (vi)   a  lump  sum   payment   representing   the  value  of  the
                     Executive's  entitlement  to receive  from the  Corporation
                     financial counseling services for the Severance Period; and

              (vii)  a  lump  sum   payment   representing   the  value  of  the
                     Executive's  entitlement  to receive  from the  Corporation
                     security  monitoring  services at the Executive's  personal
                     residence for the Severance Period;

       (b)    with respect to the  Executive's  entitlement to pension  benefits
              under  the  Pension  Plan for  Employees  of Nexen  Inc.  (Defined
              Benefit Option) (the "Registered  Pension Plan"),  if any, and the
              Executive's  related  entitlement  under the Nexen  Inc.  Restated
              Executive Benefit Plan (the "Executive Benefit Plan"), if any:


<PAGE>
                                     - 14 -


              (i)    the Corporation  shall  recognize the Severance  Period for
                     purposes of determining the Executive's entitlement;

              (ii)   for calculation  purposes,  the Executive's  entitlement is
                     the benefit which would have been determined  assuming that
                     the Executive had been  employed  throughout  the Severance
                     Period, including recognition of:

                     (A)    additional service that would have been credited for
                            the Severance Period;

                     (B)    monthly salary equal to the Executive's Monthly Base
                            Salary throughout the Severance Period;

                     (C)    pensionable  bonus  for  the  year  of the  Date  of
                            Termination, and for each subsequent year or portion
                            thereof during the Severance  Period,  determined at
                            the Annual Target Bonus level. Average bonus will be
                            determined  over the  three  years to the end of the
                            Severance  Period,  including  any partial  calendar
                            years; and

                     (D)    if  the  Executive  would  have  been  eligible  for
                            retirement at the end of the Severance  Period,  the
                            Executive shall be deemed to retire, and the pension
                            to  commence,   upon  completion  of  the  Severance
                            Period.  In such case, the Executive's  attained age
                            at  the  end  of  the   Severance   Period  will  be
                            recognized  for  purposes of  calculating  the early
                            retirement reduction factor, if applicable; and

              (iii)  the pension  entitlements  described in this Section 7.1(b)
                     shall,  to the  extent  legally  permissible,  be  provided
                     through the Registered  Pension Plan. To the extent that it
                     is  not  legally   permissible   to  provide  such  pension
                     entitlements  through  the  Registered  Pension  Plan,  the
                     Corporation  shall pay to the  Executive a lump sum payment
                     representing   the  settlement   value  of  the  additional
                     Executive  Benefit Plan benefit  determined  in  accordance
                     with the assumptions set forth in Schedule "B-1";

              (iv)   any  entitlements  of the  Executive  under  the  Executive
                     Benefit   Plan  which  have   previously   been  funded  in
                     accordance  with Article 10 but not  previously  settled in
                     accordance   with  Article  10  shall  be  settled  by  the
                     Corporation in accordance with the assumptions set forth in
                     Schedule "B-1";

       (c)    the  Corporation   shall  provide  the  Executive  with  executive
              outplacement  counselling  to be provided by a firm to be selected
              by the  Executive,  at a cost  to the  Corporation  not to  exceed
              $25,000.00;

       (d)    all of the  Executive's  outstanding  unexercisable  stock options
              under any Stock Option Plan shall become exercisable; and


<PAGE>
                                     - 15 -


       (e)    where the  Executive  has been  relocated,  at the  request of the
              Corporation,  within the two (2) year period  immediately prior to
              the  Effective  Date,  if  so  requested  by  the  Executive,  the
              Corporation  shall relocate the Executive back to the  Executive's
              prior location.

7.2    The estimated value as of April 1, 2008 of Sections  7.l(a)(ii) to 7.1(c)
       are set out in Schedule "C". Schedule "C" provides  estimated values only
       and actual values shall be  calculated  in accordance  with this Restated
       Agreement  at the time of  entitlement  or payment  under  this  Restated
       Agreement.

7.3    If  the  Executive's   employment  is  terminated  in  the  circumstances
       described  in  Section  5.1  or  6.1  of  this  Restated  Agreement,  the
       remuneration  and  benefits  payable  under  this  Article 7 shall not be
       reduced if the Executive obtains alternative employment.

7.4    Unless  expressly  provided  otherwise in this  Restated  Agreement,  all
       payments  to be made to the  Executive  under  this  Article  7 shall  be
       subject to required statutory deductions at source by the Corporation.


                                   ARTICLE 8
                            CONFIDENTIAL INFORMATION
                            ------------------------

8.1    If the Executive's  employment is terminated in any manner whatsoever due
       to or  following  a Change  of  Control,  the  Executive  agrees  to keep
       confidential  all  information  of a confidential  or proprietary  nature
       concerning the Corporation,  its Affiliates,  Associates and Subsidiaries
       and their respective operations, opportunities, areas of present, past or
       future interests,  assets, finances,  technology,  intellectual property,
       business and  affairs,  and further  agrees not to use such  information,
       data or technology for personal  advantage,  provided that nothing herein
       shall prevent the disclosure of information  which is publicly  available
       or which is required to be disclosed by the Executive  under  appropriate
       statute, rules of law or legal process.


                                   ARTICLE 9
              RIGHTS AND OBLIGATIONS OF EXECUTIVE UPON TERMINATION
              ----------------------------------------------------

9.1    Subject to Section 8.1 of this Restated  Agreement,  the Executive  shall
       not be prohibited in any manner  whatsoever  from  obtaining  alternative
       employment  with or  otherwise  forming  or  participating  in a business
       competitive to the business of the  Corporation  after the termination of
       the Executive's employment with the Corporation.

9.2    Upon the  termination of the Executive's  employment for any reason,  the
       Executive shall tender the Executive's  resignation from any position the
       Executive may hold as an officer or director of the Corporation or any of
       its Affiliates, Associates or Subsidiaries.

9.3    If  the  Executive's   employment  is  terminated  in  the  circumstances
       described  in  Section  5.1  or  6.1  of  this  Restated  Agreement,  the
       Corporation  shall  continue  to  purchase  and  maintain,  to the extent
       available in the  marketplace at reasonable cost to the  Corporation,  on

<PAGE>
                                     - 16 -


       behalf of the Executive, director and officer liability insurance for the
       applicable  limitation period following the date upon which the Executive
       ceases to serve as a  director  or officer  of the  Corporation,  and the
       Executive's  existing agreement to receive indemnity from the Corporation
       for acts taken by the Executive in the Executive's capacity as an officer
       of the Corporation shall remain in effect.

9.4    Upon termination of the Executive's employment pursuant to Section 5.1 or
       6.1 of this  Restated  Agreement,  the  Corporation  shall  reimburse the
       Executive  for ongoing legal fees and  disbursements  which the Executive
       may reasonably incur in connection with this Restated Agreement (but this
       Restated  Agreement  only),   including  any  litigation  concerning  the
       validity or enforceability  of, or liability under, any provision of this
       Restated Agreement or any action by the Executive.  The Corporation shall
       pay such fees and  reimbursements to the Executive  promptly as such fees
       and disbursements become due.


                                   ARTICLE 10
                      SECURITIZATION AND FUNDING PROCEDURE
                      ------------------------------------

10.1   The  Corporation has established and maintains a trust for the benefit of
       the Executive and persons claiming through him (the "Trust")  pursuant to
       the terms and  conditions of a trust  agreement  (the "Trust  Agreement")
       between the  Corporation  and the  Trustee.  The Trust shall be funded in
       accordance  with the provisions of this Restated  Agreement and the Trust
       Agreement.

10.2   To provide  security  against a failure by the Corporation to either fund
       or settle the  Obligations  in accordance  with the terms of this Article
       10, the Trust  Agreement  provides  for the funding of the Trust with the
       proceeds  of  an  irrevocable   letter  of  credit  which  satisfies  the
       requirements  of this  Restated  Agreement  (a "Letter of Credit") in the
       event that the Corporation does not provide funding or effect  settlement
       when required to do so hereunder and in accordance with the terms hereof.
       The Corporation  confirms that the Letter of Credit currently held by the
       Trustee has been issued by a major  Canadian  chartered bank (the "Bank")
       in an amount calculated by the Corporation's  consulting  actuary (who at
       all times shall be a Fellow of the Canadian  Institute of Actuaries) (the
       "Actuary")  in  accordance  with the  provisions  of Section 10.5 of this
       Restated Agreement.

10.3   On each February 1st (the  "Anniversary  Date"),  the  Corporation  shall
       request a report from the Actuary as to the amount calculated,  as at the
       next succeeding April 1st (the "Valuation  Date"), in accordance with the
       provisions of Section 10.5 of this Restated  Agreement.  The  Corporation
       shall  provide  the Actuary  with the data it  requires  to prepare  such
       report.  Upon  completion  of each such  report,  the  Corporation  shall
       arrange for the Actuary to provide a summary of same to the Trustee.

       Prior to the  funding  and/or  settlement  of all of the  Obligations  in
       accordance  with the terms of this Restated  Agreement,  the  Corporation
       shall,  within forty-five days after the applicable  Anniversary Date and
       in accordance with the terms of the report received from the Actuary:

<PAGE>
                                     - 17 -


       (a)    either:

              (i)    arrange  for a Letter of Credit to be  provided by the Bank
                     to the Trustee to replace the Letter of Credit then held by
                     the Trustee. The replacement Letter of Credit shall be:

                     (A)    substantially  in the form of the  Letter  of Credit
                            then held by the Trustee;

                     (B)    in an amount  calculated  by the  Actuary  as at the
                            applicable  Valuation  Date in  accordance  with the
                            provisions   of  Section   10.5  of  this   Restated
                            Agreement; and

                     (C)    for a  term  which  commences  on  the  date  of its
                            issuance   and  expires  one  year   following   the
                            applicable Valuation Date; or

              (ii)   confirm to the Trustee in writing that the Letter of Credit
                     then held by the Trustee will be extended automatically for
                     a further  one-year term. The  confirmation  to the Trustee
                     shall include evidence from the Bank as to any amendment to
                     the applicable  Letter of Credit,  any such amendment to be
                     consistent  with the report  prepared  by the Actuary as at
                     the applicable Valuation Date; and

       (b)    contribute  to the Trust an amount  equal to twice the fee charged
              by the Bank in connection  with the Letter of Credit  extension or
              replacement,   as  applicable.   The  Corporation  shall  withhold
              one-half of such amount and shall remit the said  one-half of such
              amount to the Canada Revenue Agency on account of the tax which is
              exigible   pursuant  to  the  Tax  Act  in  connection  with  such
              contribution  to the Trust.  The Trustee shall remit the remaining
              one-half  of such  amount  to the  Bank in  consideration  for the
              Letter of Credit extension or replacement, as applicable.

       When a replacement  Letter of Credit has been provided in accordance with
       the terms of this  Section  10.3,  an existing  Letter of Credit shall be
       surrendered and cancelled.

10.4   If,  during  the term of a  Letter  of  Credit  issued  pursuant  to this
       Restated Agreement,  the Corporation,  acting reasonably,  concludes that
       there has been a significant  change in the Obligations since the date of
       the last report prepared by the Actuary  pursuant to Section 10.3 of this
       Restated  Agreement,  the  Corporation  shall  request a report  from the
       Actuary as to the then current  value of the  Obligations,  calculated in
       accordance   with  the  provisions  of  Section  10.5  of  this  Restated
       Agreement.  Upon receipt of the report,  the Corporation  shall provide a
       summary of same to the Trustee and  arrange,  together  with the Trustee,
       for any  required  increase  or  decrease  in the amount of the Letter of
       Credit for the balance of the term of such Letter of Credit. In the event
       that a replacement  Letter of Credit is to be issued in the circumstances
       described in this Section  10.4,  the  Corporation  and the Trustee shall
       arrange for such replacement  Letter of Credit to be provided by the Bank
       to the Trustee to replace the Letter of Credit then held by the  Trustee.

<PAGE>
                                     - 18 -


       Upon receipt of a replacement  Letter of Credit  pursuant to this Section
       10.4, the Trustee shall surrender for  cancellation  the Letter of Credit
       then  held  by it  pursuant  to this  Restated  Agreement  and the  Trust
       Agreement.

       In the event that all or any  portion of the fee  referred  to in Section
       10.3 of this Restated Agreement, is refunded by the Bank as a result of a
       decrease  in the amount of a Letter of Credit  pursuant  to this  Section
       10.4, such amount  (together with any resulting  refundable Tax) shall be
       received  by the Trustee  for  deposit to the Trust.  Upon  receipt of an
       Authorized  Instruction (as defined in the Trust Agreement),  the Trustee
       shall pay and transfer  such amounts  (less any  applicable  tax which it
       will remit as  required by the Tax Act on behalf of the  Corporation)  to
       the Corporation for its sole and exclusive use and benefit.

       In the event that an additional fee is required to be paid to the Bank as
       a result of an increase  in the amount of a Letter of Credit  pursuant to
       this Section  10.4,  the  Corporation  shall  contribute  to the Trust an
       amount equal to twice the additional fee. The Corporation  shall withhold
       one-half of such amount and shall remit the said  one-half of such amount
       to the Canada  Revenue  Agency on  account  of the tax which is  exigible
       pursuant  to the Tax Act in  connection  with  such  contribution  to the
       Trust.  The Trustee shall remit the remaining  one-half of such amount to
       the Bank in payment of its additional fee.

10.5   A Letter of Credit issued pursuant to this Restated Agreement shall:

              (i)    be an irrevocable standby letter of credit;

              (ii)   obligate the Bank to satisfy demand for payment made by the
                     Trustee  in  accordance  with the  terms  of this  Restated
                     Agreement and the Trust Agreement;

              (iii)  permit partial drawings; and

              (iv)   provide  that the Bank must notify the Trustee on or before
                     thirty  days  prior to the  expiry of a Letter of Credit of
                     any  notice of  non-extension  provided  by the Bank to the
                     Corporation.

       The  amount of a Letter of Credit  pursuant  to this  Restated  Agreement
       shall be  calculated  by the  Actuary in  accordance  with the  following
       subparagraphs of this Section 10.5.

       (a)    Assuming  the lump sum payments  referred to in Section  7.1(a) of
              this Restated  Agreement are equal to the amount thereof  provided
              by the Corporation.

       (b)    Assuming  the  service  of  the  Executive  will   terminate,   in
              accordance with Section 5.1 or 6.1 of this Restated Agreement,  on
              the next  succeeding  March  31st  after the  Valuation  Date (the
              "Calculation Date").

       (c)    Using the  Executive's  demographic  data,  including base salary,
              target bonus and current  marital status as of the Valuation Date,
              provided by the Corporation.


<PAGE>
                                     - 19 -


       (d)    Using the Yearly Maximum  Pensionable  Earnings (Y.M.P.E.) used to
              determine  the amount of the Canada  Pension  Plan Benefit and Tax
              Act  maximum  defined  benefit  pension  dollar  limit  as at  the
              Valuation Date.

       (e)    Assuming all Obligations are included.

       (f)    Using  the  actuarial   methods,   assumptions   and   calculation
              methodology described in Schedule "B-2.

       (g)    Applying a load of 15% to the amount determined in accordance with
              subparagraphs  (b) through (f) of this Section 10.5 to provide for
              fluctuations in the Interest  Discount Rate,  Consumer Price Index
              and other plan experience during the term of the Letter of Credit,
              as described in Schedule "B-2".

       (h)    Applying a load to one-half of the amount determined in accordance
              with subparagraphs (a) through (g) of this Section 10.5 to provide
              for  the  cost  associated   with  the  borrowings   described  in
              subparagraph  (k) of this Section  10.5,  as described in Schedule
              "B-2".

       (i)    Including  a  settlement  expense  to  the  amount  determined  in
              subparagraph (h), with the aggregate  settlement expense allowance
              for all  obligations  secured  equal to  $250,000,  or  where  the
              Valuation   Date  is  after   December  31,  2008,  the  aggregate
              settlement  expense  allowance will be increased at the rate equal
              to the  increase in the  Consumer  Price  Index,  as  described in
              Schedule "B-2", plus 1% for each year after 2008.

       (j)    Assuming  the  Obligations  will  be  promptly  settled  with  the
              Executive  upon  occurrence  of a  Designated  Event  described in
              Section 1.1(n)(ii).

       (k)    Assuming  a loan  will be  secured  to  permit  settlement  of the
              Obligations  prior to receipt of the  Refundable  Tax Account from
              the Canada Revenue  Agency.  The assumed  interest rate payable on
              the  loan  shall  be as  described  in  Schedule  "B-2".  The cost
              associated  with the  borrowings  shall be assumed to be paid from
              the Trust.

       (l)    The liabilities  calculated in accordance with  subparagraphs  (a)
              through (k) above shall be offset by:

              (i)    the Refundable Tax Account, if any; and

              (ii)   the assets contained in the Trust, if any.

10.6   (a)    If an Executive  Benefit Plan Obligations - Designated Event shall
              occur,  the Corporation  shall be required to immediately fund the
              Executive  Benefit Plan  Obligations  in accordance  with the most
              recent report prepared by the Actuary  pursuant to Section 10.3 of
              this Restated  Agreement.  Notwithstanding  the  foregoing,  if an
              Executive Benefit Plan Obligations - Designated Event described in

<PAGE>
                                     - 20 -


              Section 1.1(x)(i) and a Change of Control Obligations - Designated
              Event described in Section 1.1(n)(ii) shall occur  simultaneously,
              the Corporation  shall be required to settle the Executive Benefit
              Plan  Obligations  forthwith in accordance  with the provisions of
              Schedule "B-1".

       (b)    If:

              (i)    the  employment  of  the  Executive  is  terminated  by the
                     Corporation  for any  reason  other than as a result of the
                     death, disability or retirement of such Executive; and

              (ii)   such Executive files with the Corporation a written request
                     that it fund the Executive Benefit Plan Obligations,

                  the  Corporation  shall be  required to  immediately  fund the
                  Executive Benefit Plan Obligations in accordance with the most
                  recent report prepared by the Actuary pursuant to Section 10.3
                  of this Restated Agreement.

       (c)    Upon the earlier of:

              (i)    learning of the  occurrence  of an  Executive  Benefit Plan
                     Obligations  -  Designated   Event   described  in  Section
                     1.1(x)(v) or (vi) of this Restated Agreement; or

              (ii)   receipt  of a  written  notice  of  the  occurrence  of  an
                     Executive  Benefit  Plan  Obligations  -  Designated  Event
                     described  in any of the  other  subparagraphs  of  Section
                     1.1(x) of this  Restated  Agreement,  which notice has been
                     signed by two  executives of the  Corporation,  one of whom
                     must be either the Chief  Financial  Officer or the General
                     Counsel of the  Corporation  and which notice must,  in the
                     case of an Executive  Benefit Plan Obligations - Designated
                     Event  described  in  Section  1.1(x)(i)  of this  Restated
                     Agreement, indicate which subparagraph of the definition of
                     "Change of Control" is applicable,

              the  Trustee  shall  promptly  give notice to the  Corporation  in
              writing  that it intends to draw on that  portion of the Letter of
              Credit  which  is  referable   to  the   Executive   Benefit  Plan
              Obligations   and  contribute  the  proceeds   thereof  (less  any
              applicable  withholding tax which it will remit as required by the
              Tax Act on  behalf of the  Corporation)  to the Trust on behalf of
              the  Corporation  in  order  to fund the  Executive  Benefit  Plan
              Obligations,  unless it receives  satisfactory  proof  within nine
              days of such notice that the Corporation has funded or settled, as
              applicable,  the  Executive  Benefit  Plan  Obligations  itself in
              accordance with the terms of this Restated Agreement.

              Unless the Corporation  advises the Trustee in writing that it has
              funded or settled,  as  applicable,  the  Executive  Benefit  Plan
              Obligations  in  accordance   with  the  terms  of  this  Restated

<PAGE>
                                     - 21 -


              Agreement  and has provided the Trustee  with  satisfactory  proof
              thereof within nine days of the date of the aforementioned notice,
              the  Trustee  shall  draw on that  portion of the Letter of Credit
              which is referable to the Executive  Benefit Plan  Obligations  on
              the  tenth  day  following  the date of such  notice  (or the next
              following  business  day if such tenth day is not a business  day)
              and   contribute   the  proceeds   thereof  (less  any  applicable
              withholding  tax which it will remit as required by the Tax Act on
              behalf  of  the  Corporation)  to  the  Trust  on  behalf  of  the
              Corporation.

              Notwithstanding  the foregoing,  in the event an Executive Benefit
              Plan Obligations - Designated Event described in Section 1.1(x)(v)
              or (vi) of this Restated  Agreement has triggered the operation of
              this  Section  10.6  and  the  failure  which  gave  rise  to  the
              occurrence of such Executive Benefit Plan Obligations - Designated
              Event has been  remedied  prior to the  expiration  of the  notice
              period provided for in this Section 10.6(c), the Trustee shall not
              take the action described in the immediately  preceding  paragraph
              hereof and all of the provisions of this Restated  Agreement shall
              continue  to apply to the same  extent  and as fully as they would
              have in the event that such Executive  Benefit Plan  Obligations -
              Designated Event had not occurred.

       (d)    Upon receipt of a written  notice of the  occurrence of the events
              described in both subparagraphs (i) and (ii) of Section 10.6(b) of
              this  Restated  Agreement  (which  notice  has been  signed by the
              Executive  and sworn before a notary  public),  the Trustee  shall
              promptly give notice to the Corporation in writing that it intends
              to draw on that portion of the Letter of Credit which is referable
              to the  Executive  Benefit Plan  Obligations  and  contribute  the
              proceeds (less any applicable  withholding tax which it will remit
              as  required by the Tax Act on behalf of the  Corporation)  to the
              Trust on behalf of the  Corporation in order to fund the Executive
              Benefit Plan  Obligations  unless it receives  satisfactory  proof
              within nine days of the date of such  notice that the  Corporation
              has  funded  the  Executive  Benefit  Plan  Obligations  itself in
              accordance with the terms of this Restated Agreement.

              Unless the Corporation  advises the Trustee in writing that it has
              funded the Executive  Benefit Plan  Obligations in accordance with
              the terms hereof and has  provided  the Trustee with  satisfactory
              proof thereof  within nine days of the date of the  aforementioned
              notice,  the Trustee shall draw upon that portion of the Letter of
              Credit  which  is  referable   to  the   Executive   Benefit  Plan
              Obligations on the tenth day following the date of such notice (or
              the  next  following  business  day  if  such  tenth  day is not a
              business day) and  contribute  the proceeds  (less any  applicable
              withholding  tax which it will remit as required by the Tax Act on
              behalf  of  the  Corporation)  to  the  Trust  on  behalf  of  the
              Corporation.

       (e)    For purposes of determining  the required amount of funding or the
              portion  of the  Letter of Credit to be drawn on for  purposes  of
              this  Section  10.6,  the  Trustee  shall refer to the most recent
              report  prepared  by the Actuary  for  purposes  of this  Restated

<PAGE>
                                     - 22 -


              Agreement and, in particular, to the portion of the report dealing
              with the  Executive  Benefit Plan  Obligations.  In preparing  the
              portion  of  its  report   respecting   Executive   Benefit   Plan
              Obligations, the Actuary shall adhere to the following:

              (i)    Assuming that the Executive,  if then in active employment,
                     will remain in active employment with the Corporation as an
                     officer until the Calculation Date and that the Executive's
                     employment  with  the  Corporation  will  terminate  on the
                     Calculation Date.

              (ii)   Using the  Executive's  demographic  data,  including  base
                     salary,  actual  bonus  history,  target  bonus and current
                     marital  status as of the Valuation  Date,  provided by the
                     Corporation.

              (iii)  Using the Canada  Pension  Plan Benefit and Tax Act maximum
                     defined  benefit  pension  dollar limit as at the Valuation
                     Date.

              (iv)   Assuming the Executive's target bonus percentage remains at
                     the  level  specified  by  the   Corporation   pursuant  to
                     subparagraph (ii) above.

              (v)    Assuming  only  Executive   Benefit  Plan  Obligations  are
                     included.

              (vi)   Assuming  the  payments  under the  Executive  Benefit Plan
                     would be made from the Trust.

              (vii)  Using the actuarial  methods,  assumptions  and calculation
                     methodology described in Schedule "B-2.

              (viii) Applying loads as described in Schedule "B-2" to the amount
                     determined in accordance  with the preceding  subparagraphs
                     of this Section 10.6(e) to provide for future contingencies
                     and expenses of the Trust.

              (ix)   Calculating  the  estimated  amount  required to settle the
                     Executive  Benefit Plan Obligations  based on the actuarial
                     methods,  assumptions and calculation methodology described
                     in Schedule "B-2",  increased by the loads described in the
                     following subparagraph.

              (x)    Applying loads as described in Schedule "B-2" to the amount
                     determined in accordance with  subparagraph (ix) to provide
                     for:

                     (A)    fluctuations  in  the  Interest  Discount  Rate  and
                            Consumer  Price Index  during the term of the Letter
                            of Credit; and

                     (B)    the cost  associated  with the loan to be secured as
                            allowed   under  the  Trust   Agreement   to  permit
                            settlement of the Executive Benefit Plan Obligations
                            prior to receipt of the  Refundable Tax Account from
                            the Canada Revenue Agency. The assumed interest rate

<PAGE>
                                     - 23 -


                            payable  on  the  loan  shall  be  as  described  in
                            Schedule  "B-2" and shall be applied to  one-half of
                            the amount in subparagraph (ix). The cost associated
                            with the borrowings shall be assumed to be paid from
                            the Trust.

              (xi)   Taking the larger amount for the Executive of:

                     (A)    the   amount    determined   in   accordance    with
                            subparagraphs (i) through (viii), and

                     (B)    the   amount    determined   in   accordance    with
                            subparagraphs (ix) and (x).

              (xii)  The amount  determined in accordance with subparagraph (xi)
                     above shall be offset by:

                     (A)    the Refundable Tax Account, if any;

                     (B)    the assets contained in the Trust, if any.

       (f)    In the event that the Executive Benefit Plan Obligations have been
              funded in accordance with the terms hereof as a result of:

              (i)    the  Corporation  making an  assignment  for the benefit of
                     creditors  or filing a petition in  bankruptcy  or becoming
                     insolvent or bankrupt;

              (ii)   a receiver, trustee or liquidator of or for the Corporation
                     being appointed and not being discharged within a period of
                     sixty days;

              (iii)  a voluntary dissolution or wind-up of the Corporation; or

              (iv)   a sale or  disposition of all or  substantially  all of the
                     assets of the Corporation,

              and the Executive  Benefit Plan has been  terminated in connection
              therewith,   the  Executive  Benefit  Plan  Obligations  shall  be
              promptly  settled by the Trustee  with the  Executive  by way of a
              lump sum payment  from the Trust.  For this  purpose,  the benefit
              entitlements  of each Executive shall be determined by the Actuary
              in accordance with the terms of the Executive Benefit Plan and the
              amount of the lump sum payment  shall be determined by the Actuary
              using the  assumptions  set  forth in  Schedule  "B-1".  Notice of
              termination of the Executive Benefit Plan shall be provided to the
              Trustee by the Corporation, failing which by two executives of the
              Corporation,  one of  whom  must be  either  the  Chief  Financial
              Officer or the General Counsel of the Corporation.


<PAGE>
                                     - 24 -


              Any assets of the Trust remaining  after full  satisfaction of (i)
              the Executive  Benefit Plan Obligations  pursuant to the preceding
              paragraph and (ii) any further  obligations  pursuant to the terms
              of the Trust Agreement, shall be returned to the Corporation.

       (g)    In the event the Executive Benefit Plan shall be terminated at any
              time  either  in whole  or in part in  relation  to the  Executive
              subsequent   to  the  funding  of  the   Executive   Benefit  Plan
              Obligations in accordance  with the terms hereof,  then,  provided
              Section  10.6(f)  of  this  Restated  Agreement  is not  otherwise
              applicable,  the  Executive  Benefit  Plan  Obligations  shall  be
              promptly  settled by the Trustee  with the  Executive  by way of a
              lump sum payment from the Trust.

              For this purpose,  the benefit entitlements of the Executive shall
              be determined  by the Actuary in accordance  with the terms of the
              Executive  Benefit  Plan and the  amount  of the lump sum  payment
              shall be determined by the Actuary using the assumptions set forth
              in Schedule  "B-1".  Notice of the  termination  of the  Executive
              Benefit Plan shall be provided to the Trustee by the  Corporation,
              failing which by two  executives of the  Corporation,  one of whom
              must be either the Chief Financial  Officer or the General Counsel
              of the Corporation.

              Any assets of the Trust remaining  after full  satisfaction of (i)
              the  Executive  Benefit  Plan  Obligations  and (ii)  any  further
              obligations pursuant to the terms of the Trust Agreement, shall be
              returned to the Corporation.

       (h)    In the event:

              (i)    of a dispute  as to  whether a payment  to or in respect of
                     the  Executive is properly due and payable  pursuant to the
                     Executive Benefit Plan; and

              (ii)   such  dispute  cannot be resolved  by the  parties  thereto
                     within the time frame  specified in Section  1.1(x)(vi)  of
                     this Restated Agreement,

              the amount in dispute shall be remitted to the Trustee for deposit
              to the Trust. Upon final settlement of the dispute,  the amount so
              deposited  (together  with any  earnings,  profits and  increments
              thereon and after deduction of any authorized  payments  allocable
              thereto,  both as determined  in accordance  with the terms of the
              Trust Agreement),  less any applicable  withholding tax which will
              be  remitted  as  required  by the Tax Act,  shall be paid to that
              party to the dispute which is found to be entitled thereto.  Prior
              to such amount being paid out of the Trust in accordance  with the
              terms hereof,  the Corporation  shall instruct the Actuary to take
              such amount into account when preparing its report for purposes of
              this Restated Agreement.

       (i)    In the event that a Change of  Control  Obligations  -  Designated
              Event described in Section  1.1(n)(ii) of this Restated  Agreement
              shall occur  subsequent  to the funding of the  Executive  Benefit
              Plan  Obligations  in  accordance  with the terms of this Restated
              Agreement,  the  Corporation  shall  be  required  to  settle  the
              Executive   Benefit  Plan  Obligations   forthwith  in  an  amount
              determined  by the Actuary in  accordance  with the  provisions of
              Schedule "B-1".


<PAGE>
                                     - 25 -


       (j)    Subject to Section  10.6(f),  10.6(g) and 10.6(i) of this Restated
              Agreement,   in  the  event  that  the   Executive   Benefit  Plan
              Obligations  have been funded in accordance with the terms hereof,
              all or a portion of such Executive  Benefit Plan  Obligations may,
              at the discretion of the Corporation, be promptly settled with the
              Executive.

              For this purpose,  the benefit entitlements of the Executive shall
              be determined  by the Actuary in accordance  with the terms of the
              Executive  Benefit Plan. In such  circumstances,  the  Corporation
              reserves   the  right  to  settle  the   Executive   Benefit  Plan
              Obligations by way of a lump sum payment to the Executive provided
              that the amount of each such payment is  determined by the Actuary
              in accordance with the assumptions set forth in Schedule "B-1".

10.7   (a)    If a Change of Control Obligations - Designated Event described in
              Section  1.1(n)(i) of this  Restated  Agreement  shall occur,  the
              Corporation  shall be required to  immediately  fund the Change of
              Control  Obligations  in  accordance  with the most recent  report
              prepared by the Actuary  pursuant to Section 10.3 of this Restated
              Agreement.

       (b)    If a Change of Control Obligations - Designated Event described in
              Section  1.1(n)(ii) of this Restated  Agreement  shall occur,  the
              Corporation  shall be  required  to settle  the  Change of Control
              Obligations   forthwith  in  accordance  with  the  provisions  of
              Schedule  "B-1",  upon  receipt  by the  Corporation  of a Release
              executed by the  Executive in the form  attached to this  Restated
              Agreement as Schedule "A".

       (c)    Upon the earlier of:

              (i)    learning  of  the   occurrence   of  a  Change  of  Control
                     Obligations  -  Designated   Event   described  in  Section
                     1.1(n)(i) of this Restated Agreement; or

              (ii)   receipt of a written  notice of the  occurrence of a Change
                     of Control  Obligations  -  Designated  Event  described in
                     Section 1.1(n)(ii) of this Restated Agreement, which notice
                     has been signed by the  Executive and sworn before a notary
                     public and has  annexed  thereto a Release  executed by the
                     Executive in the form attached to this  Restated  Agreement
                     as Schedule "A",

              the  Trustee  shall  promptly  give notice to the  Corporation  in
              writing  that it intends to draw on that  portion of the Letter of
              Credit which is referable to the Change of Control Obligations and
              contribute the proceeds  thereof (less any applicable  withholding
              tax which it will  remit as  required  by the Tax Act on behalf of
              the  Corporation)  to the Trust on behalf  of the  Corporation  in

<PAGE>
                                     - 26 -


              order  to fund  the  Change  of  Control  Obligations,  unless  it
              receives  satisfactory  proof within nine days of such notice that
              the Corporation has funded or settled,  as applicable,  the Change
              of Control Obligations itself in accordance with the terms of this
              Restated Agreement.

              Unless the Corporation  advises the Trustee in writing that it has
              funded  or  settled,   as   applicable,   the  Change  of  Control
              Obligations  in  accordance   with  the  terms  of  this  Restated
              Agreement  and has provided the Trustee  with  satisfactory  proof
              thereof within nine days of the date of the aforementioned notice,
              the  Trustee  shall  draw on that  portion of the Letter of Credit
              which is  referable  to the Change of Control  Obligations  on the
              tenth day following the date of such notice (or the next following
              business  day  if  such  tenth  day  is not a  business  day)  and
              contribute the proceeds (less any applicable withholding tax which
              it  will  remit  as  required  by the  Tax  Act on  behalf  of the
              Corporation) to the Trust on behalf of the Corporation.

              Notwithstanding  the  foregoing,  in the event a Change of Control
              Obligations - Designated  Event described in Section  1.1(n)(i) of
              this  Restated  Agreement  has  triggered  the  operation  of this
              Section 10.7 and the failure which gave rise to the  occurrence of
              such Change of Control  Obligations  -  Designated  Event has been
              remedied prior to the expiration of the notice period provided for
              in this  Section  10.7(c),  the Trustee  shall not take the action
              described in the immediately preceding paragraph hereof and all of
              the provisions of this Restated  Agreement shall continue to apply
              to the same  extent  and as fully as they  would have in the event
              that such Change of Control Obligations - Designated Event had not
              occurred.

       (d)    The  required  amount of funding  or the  portion of the Letter of
              Credit to be drawn on for  purposes of this  Section 10.7 shall be
              determined  by the Actuary and shall be the amount  determined  in
              accordance  with  Sections  10.5(a)  through (l) of this  Restated
              Agreement  offset by the  amount  determined  in  accordance  with
              subparagraphs 10.6(e)(i) through (xii) of this Restated Agreement.
              The  settlement  amount for purposes of this Section 10.7 shall be
              determined in accordance with the provisions of Schedule "B-1".

       (e)    In the event  that the  Change of  Control  Obligations  have been
              funded  in  accordance  with the  terms  hereof as a result of the
              occurrence of a Change of Control  Obligations - Designated  Event
              described in Section 1.1(n)(ii), the Change of Control Obligations
              shall be promptly  settled with the Executive in  accordance  with
              the provisions of Schedule "B-1".

10.8   The actuarial  methods and  assumptions  described in Schedule  "B-1" and
       Schedule  "B-2" shall be reviewed  from time to time.  Any  amendments to
       Schedule "B-1" and/or  Schedule "B-2" as a result of such review shall be
       dealt with in accordance with Section 12.6.


<PAGE>
                                     - 27 -


10.9   The Trustee shall  surrender the Letter of Credit to the  Corporation for
       cancellation upon the earliest of:

       (a)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation and the Executive directing surrender of the Letter of
              Credit;

       (b)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation  confirming  that it has  funded  and/or  settled  the
              Obligations  in accordance  with the terms  hereof,  together with
              evidence  which is  satisfactory  to the Trustee that such funding
              and/or settlement has occurred; and

       (c)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation  confirming  that  the  Corporation  has no  remaining
              Obligations  to the  Executive,  together with  evidence  which is
              satisfactory  to the Trustee that the Corporation has no remaining
              Obligations  to the  Executive  and  that a copy of  such  written
              direction has been provided to the Executive.

10.10  The Trust shall be terminated by the Trustee upon the earliest of:

       (a)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation  and the Executive  confirming the  termination of the
              Trust;

       (b)    the entire depletion of the Trust Fund through  payments  pursuant
              to the  terms of the  Trust  Agreement,  in the  event  that  such
              depletion  occurs  subsequent to the funding of the Obligations in
              accordance with the terms of this Restated Agreement; and

       (c)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation  confirming  that  the  Corporation  has no  remaining
              Obligations  to the  Executive,  together with  evidence  which is
              satisfactory to the Trustee that a copy of such written  direction
              has been provided to the Executive.

       Upon the  termination of the Trust,  any assets of the Trust which remain
       after the satisfaction of any remaining Obligations of the Corporation to
       the Executive shall be returned to the Corporation.

10.11  The Corporation and the Executive hereby acknowledge that the Corporation
       is entering  into  agreements  similar to this  Restated  Agreement  with
       certain of its other executives and that the Corporation may, at its sole
       discretion,  arrange  for one or more  Letters of Credit to  satisfy  its
       responsibilities under this Restated Agreement and such other agreements.
       In the  event  that one  Letter  of Credit is  obtained  to  satisfy  the
       Corporation's  responsibilities under this Restated Agreement and some or
       all of such other agreements,  references to a "Letter of Credit" in this
       Restated  Agreement  shall be read as  references to that portion of such
       Letter  of  Credit  which is  referable  to the  responsibilities  of the
       Corporation to the Executive.


<PAGE>
                                     - 28 -


       The Corporation and the Executive also  acknowledge  that the Corporation
       may, at its sole  discretion,  enter into one or more Trust Agreements to
       satisfy its responsibilities under this Restated Agreement and such other
       agreements.  In the event that one Trust  Agreement  is  entered  into to
       satisfy the Corporation's  responsibilities under this Restated Agreement
       and some or all of such other agreements,  references to "Trust",  "Trust
       Agreement",  "Trustee"  and  "Refundable  Tax  Account" in this  Restated
       Agreement  shall be read with such  modifications  as may be necessary in
       the context.

10.12  At the  discretion of the  Corporation  and subject to the  provisions of
       applicable law, in the event that all or a portion of the Obligations are
       funded in  accordance  with  Article 10 hereof and an  actuarial  surplus
       (determined  by actuarial  valuation in accordance  with the terms of the
       report  prepared  as at  the  immediately  preceding  Valuation  Date  in
       accordance  with Section  10.3 of this  Restated  Agreement)  arises as a
       result thereof:

       (a)    all or a  portion  of such  actuarial  surplus  may be used in the
              determination of or to reduce the funding otherwise required to be
              provided by the Corporation hereunder; or

       (b)    any surplus assets may, to the extent that they exceed 110% of the
              amount required to fund that portion of the Obligations  which has
              been  funded  (as  determined  by the  report  prepared  as at the
              immediately  preceding  Valuation Date in accordance  with Section
              10.3 of this Restated Agreement) be returned to the Corporation.


                                   ARTICLE 11
                              EXPEDITED ARBITRATION
                              ---------------------

11.1   If,  pursuant to Section 6.1 of this  Restated  Agreement,  the Executive
       provides  written  notice of the  Executive's  intention to terminate the
       Executive's employment for Good Reason, and the Corporation believes that
       there is no Good Reason, or,  alternatively,  if, pursuant to Section 4.1
       of this Restated  Agreement,  the Corporation  provides written notice of
       its intention to terminate the Executive's  employment for Just Cause and
       the Executive  believes  there is no Just Cause,  the  Corporation or the
       Executive,  as  applicable,  shall,  within ten (10) days of having  been
       provided such notice, provide written notice ("Notice of Dispute") to the
       other Party of the dispute (the "Dispute").

11.2   The Parties  agree that any and all Disputes  under  Section 11.1 of this
       Restated Agreement will be resolved by way of a single Arbitrator.

11.3   (a)    Within  fifteen  (15) days of  provision of the Notice of Dispute,
              the Parties shall agree upon and appoint a neutral Arbitrator from
              the then current  roster  maintained by the Alberta  Mediation and
              Arbitration Society to act as Arbitrator of the Dispute; or


<PAGE>
                                     - 29 -


       (b)    If no person  acceptable  to both Parties has been agreed upon and
              appointed  within  fifteen  (15) days,  then either Party may make
              immediate  application  to the Court of Queen's  Bench of Alberta,
              Judicial District of Calgary, to have an Arbitrator appointed.

11.4   The Parties  acknowledge and agree that the purpose of this Article 11 is
       to avoid  delays  and  facilitate  resolution  of the  Dispute in a just,
       speedy and cost-effective manner.

11.5   Consistent with the expedited nature of arbitration,  the Arbitrator will
       direct and  control the scope and timing of the  exchange of  information
       between  the  Parties  and will take such steps as the  Arbitrator  deems
       necessary to achieve a just, speedy and cost-effective  resolution of the
       Dispute.  The Arbitrator has the exclusive right and power to resolve all
       issues related to the exchange of information in the arbitration process.

11.6   The Parties  agree that the  Arbitrator  is only  authorized to determine
       whether the Executive  had Good Reason for  terminating  the  Executive's
       employment,  or alternatively,  whether the Corporation had Just Cause to
       terminate the Executive's employment.

11.7   A hearing will occur within  forty-five  (45) days of the  appointment of
       the  Arbitrator  (the  "Hearing").  The time of the Hearing (the "Hearing
       Date") will be scheduled by the Arbitrator  after  consultation  with the
       Parties.  The  Hearing  will  be  governed  by the  rules  set out in the
       Arbitration Act S.A. 1991,  c.A-43,  as modified by the Arbitrator in the
       interests of achieving a just,  speedy and  cost-effective  resolution of
       the Dispute.  The Arbitrator may require  written  submissions of fact in
       the Dispute to be provided seven (7) days before the Hearing Date.

11.8   The Arbitrator will use best efforts to provide a written decision within
       seven (7) days of the conclusion of the Hearing.

11.9   The Parties agree that the decision of the  Arbitrator  will be final and
       binding upon the Parties.


                                   ARTICLE 12
                                     GENERAL
                                     -------

12.1   The headings of the Articles and  paragraphs in this  Restated  Agreement
       are  inserted  for  convenience  only and shall not affect the meaning or
       construction of this Restated Agreement.

12.2   This Restated  Agreement shall be construed and interpreted in accordance
       with the laws of the  Province of Alberta and the federal  laws of Canada
       as applicable therein.

12.3   If any provision of this  Restated  Agreement is determined to be void or
       unenforceable  in  whole or in part,  it  shall  be and be  deemed  to be
       severed from this Restated  Agreement  without affecting or impairing the
       validity of any other provision herein.


<PAGE>
                                     - 30 -


12.4   Any  notice  required  or  permitted  to be  given  under  this  Restated
       Agreement shall be in writing and shall be properly given if delivered by
       hand delivery or mail or other form of electronic  communication  capable
       of transmission confirmation to the following address:

       a.     IN THE CASE OF THE CORPORATION TO:
              ----------------------------------

              Nexen Inc.
              801 - 7th Avenue S.W.
              Calgary, AB  T2P 3P7
              Attention:  General Manager, Compensation and Benefits

       b.     IN THE CASE OF THE EXECUTIVE TO:
              --------------------------------

              the  last  address  of  the   Executive  in  the  records  of  the
              Corporation  or to such other address as the Parties may from time
              to time specify by notice given in accordance herewith.

12.5   This Restated Agreement shall enure to the benefit of and be binding upon
       the Executive and the Executive's heirs, executors and administrators and
       upon the Corporation and its successors and assigns.

12.6   This Restated Agreement  constitutes the entire agreement relating to the
       respective rights and obligations of the Parties upon the occurrence of a
       Change of Control.  No  amendment  or waiver of this  Restated  Agreement
       shall be binding unless executed in writing by the Parties.

       Notwithstanding the foregoing,

       (a)    any amendment to Article 10 of this Restated  Agreement,  Schedule
              "B-1" or  Schedule  "B-2"  which is  required  to ensure  that the
              balance  remaining  in the Trust after the  required  tax has been
              withheld and remitted to the Canada  Revenue  Agency is sufficient
              to  satisfy  the fee  levied  by the Bank in  connection  with the
              issuance  of a Letter  of  Credit  may be made by the  Corporation
              without the prior written approval of the Executive; and

       (b)    the  Corporation  may  amend,  modify or waive  Article 10 of this
              Restated Agreement,  Schedule "B-1" and Schedule "B-2" in whole or
              in part,  at such time and from time to time,  and in such  manner
              and to such extent as it may deem advisable  without obtaining the
              approval  of  the   Executive,   provided  that  such   amendment,
              modification  or waiver,  as the case may be,  does not  adversely
              affect the  securitization  in accordance with the terms hereof of
              those  Obligations  which  have  accrued  up to the  date  of such
              amendment, modification or waiver, as the case may be.


<PAGE>
                                     - 31 -


12.7   The Parties agree that the rights,  entitlements  and benefits set out in
       this  Restated  Agreement  to be paid to the  Executive  upon a Change of
       Control  shall be in full  satisfaction  of all  rights of the  Executive
       under applicable law in effect from time to time as a result thereof.

12.8   Neither  Party can waive or shall be deemed to have  waived  any right it
       has under this Restated  Agreement  except to the extent that such waiver
       is in writing.

12.9   Nothing  contained  in this  Restated  Agreement  shall be  construed  as
       limiting the ability of the Corporation to amend, modify or terminate the
       Executive Benefit Plan in whole or in part, at such time and from time to
       time, and in such manner and to such extent as it may deem advisable.

The Parties have  executed  this  Restated  Agreement  effective  the date first
written above.


                                                NEXEN INC.


                                                Per: (signed)
                                                     ---------------------------


                                                Per: (signed)
                                                     ---------------------------



SIGNED, SEALED & DELIVERED
in the presence of


(signed)                                        (signed)
------------------------------                  --------------------------------
WITNESS                                         LAURENCE MURPHY


<PAGE>


                                  SCHEDULE "A"
                                  ------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS

In order to  receive  the  entitlements  referred  to in the  Article  7 of this
Restated  Agreement,  the Executive  shall execute the attached  Release,  fully
releasing the Corporation from all further claims in relation to the Executive's
employment or Employment  Benefits and the  termination  thereof upon payment of
the  remuneration  and  benefits  referred  to in  Article  7 of  this  Restated
Agreement.  The attached Release shall not, however,  require that the Executive
relinquish  or release any rights to indemnity  which the  Executive  may, as an
officer or director of the Corporation or any of its Affiliates,  Associates and
Subsidiaries,  have  as  against  the  Corporation  or any  of  its  Affiliates,
Associates and Subsidiaries, for costs, charges and expenses reasonably incurred
by the Executive in respect of any civil,  criminal or administrative  action or
proceeding  to which the  Executive is made a party by reason of being or having
been a  director  or  officer  of  the  Corporation  or  any of its  Affiliates,
Associates and Subsidiaries, where:


       (a)    the Executive has acted  honestly and in good faith with a view to
              the best interests of the  Corporation  or any of its  Affiliates,
              Associates and Subsidiaries; and


       (b)    in the case of a criminal or  administrative  action or proceeding
              enforced  by a monetary  penalty,  the  Executive  had  reasonable
              grounds for believing the Executive's conduct was lawful.


<PAGE>

                                  FINAL RELEASE
                                  -------------

KNOW ALL MEN BY THESE PRESENTS that I, LAURENCE MURPHY,  of the City of Calgary,
in the Province of Alberta,  in  consideration  of the amounts  provided in that
certain  Amended  and  Restated  Agreement  Respecting  Change  of  Control  and
Executive Benefit Plan  Entitlements (the "Restated  Agreement") dated as of the
______ day of  ____________,  2008  between  myself and NEXEN INC. and for other
good and valuable consideration,  the receipt and sufficiency of which is hereby
acknowledged, do for myself, my executors and assigns hereby remise, release and
forever discharge the Corporation, and any associated,  affiliated,  predecessor
or parent corporation of the Corporation and their present and former directors,
officers,  agents  and  employees  (the  "Releasees"),  including  each of their
respective  successors,  heirs,  administrators and assigns,  from all manner of
actions,  causes of action, debts,  obligations,  covenants,  claims or demands,
whatsoever  which I may ever have had, now have, or can,  shall or may hereafter
have against the  Releasees  or any of them,  by reason of or arising out of any
cause,  matter  or  thing  whatsoever  done,  occurring  or  existing  up to and
including the present date and, in  particular,  without in any way  restricting
the  generality  of the  foregoing,  in  respect  of all  claims  of any  nature
whatsoever,  past,  present  or future,  directly  or  indirectly  related to or
arising out of or in connection with my relationship  with the Releasees,  as an
employee,  officer or director,  and the  termination of my employment  from the
Corporation including, but not limited to, any claims related to any entitlement
I may have or may have had to any payment or claim either at common law or under
the Employment  Standards Code, Human Rights,  Citizenship and  Multiculturalism
Act or any other  applicable  legislation  governing or related to my employment
with the Releasees.


AND FOR THE SAID CONSIDERATION, I, LAURENCE MURPHY, represent and warrant that I
have not assigned to any person, firm or corporation any of the actions,  causes
of action, claims, suits, executions or demands which I release by this Release,
or with  respect  to which I agree not to make any claim or take any  proceeding
herein.


IT IS FURTHER ACKNOWLEDGED that the payment to me includes full compensation and
consideration  for the  loss  of my  employment  benefits,  as  provided  by the
Releasees,  and that all of my employment benefits and privileges shall cease on
the date of termination of my employment, except as otherwise expressly provided
in the  Restated  Agreement.  I further  acknowledge  that I have  received  all
benefits  due to me and have no further  claim  against the  Releasees  for such

<PAGE>
                                     - 2 -


benefits.  I further accept sole responsibility to replace such benefits which I
wish to continue or to exercise  conversion  privileges  where  applicable  with
respect to such  benefits and, in  particular  any life  insurance and long-term
disability benefits.  In the event that I become disabled following  termination
of my  employment,  I covenant not to sue the  Releasees  for insurance or other
benefits  or loss of same and  hereby  release  the  Releasees  from any and all
further obligations or liabilities arising therefrom.


Notwithstanding  anything contained herein,  this Release shall not extend to or
affect,  or  constitute a release of, my right to sue,  claim against or recover
from the  Releasees  and shall not  constitute  an  agreement  to  refrain  from
bringing, taking or maintaining any action against the Releasees in respect of:

       (a)    any corporate indemnity existing by statute,  contract or pursuant
              to any of the constating  documents of the Corporation provided in
              my favour in respect of my having acted at any time as a director,
              officer or both of the Corporation;


       (b)    my  entitlement  to any  insurance  maintained  for the benefit or
              protection of the directors  and/or  officers of the  Corporation,
              including without  limitation,  directors' and officers' liability
              insurance; or


       (c)    my entitlement to any amounts or compensation  due to me under the
              terms of my employment pursuant to the Restated Agreement.


IT IS HEREBY AGREED that the terms of the Restated Agreement and of this Release
will be kept  confidential.  No party hereto shall communicate any such terms to
any third party under any  circumstances  whatsoever,  excepting  any  necessary
communication with my legal and financial advisors,  as required, on the express
condition  that they maintain the  confidentiality  thereof,  and any disclosure
which is required by law,  although either party shall be at liberty to disclose
to third  parties  that a  mutually  acceptable  Release  was agreed  upon.  The
invalidity  and  unenforceability  of any  provision of this  Release  shall not
affect the validity or  enforceability  of any other  provision of this Release,
which shall remain in full force and effect.



<PAGE>
                                     - 3 -


I HEREBY  DECLARE that I have read all of this  Release,  fully  understand  the
terms of this Release and voluntarily accept the consideration  stated herein as
the sole  consideration  for this  Release  for the purpose of making a full and
final  settlement with the Releasees.  I further  acknowledge and confirm that I
have been given an adequate period of time to obtain  independent  legal counsel
regarding the meaning and the significance of the terms herein and the covenants
mutually exchanged.


IT IS HEREBY AGREED THAT as a term of the  termination of my employment from the
Corporation,  and in consideration of the amount noted above, I hereby resign as
officer and director of the Corporation and its affiliates.


IN  WITNESS  WHEREOF,  I have  hereunto  set my hand and seal this  _____ day of
______________ in the year _________.




-------------------------------
LAURENCE MURPHY



-------------------------------
WITNESS (signature)



-------------------------------
WITNESS (print name)



<PAGE>

                                 SCHEDULE "B-1"
                                 --------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS
          METHODOLOGY AND ASSUMPTIONS FOR DETERMINING SETTLEMENT VALUE


PURPOSE

In  accordance  with the terms of the  Restated  Agreement,  the purpose of this
Schedule "B-1" is to outline the calculation  approach such that,  after tax has
been paid on a lump sum settlement  value, the remaining  balance is intended to
be sufficient to provide after-tax monthly payments  equivalent to the after-tax
monthly  payments  the  Executive  would  have  received  under the terms of the
Executive Benefit Plan as provided for under this Restated Agreement.



OVERVIEW FOR DEFINED BENEFIT PENSION

The  following  outlines the  actuarial  methods,  assumptions  and  calculation
process to be used in determining  the lump sum settlement  value of the defined
benefit pension  entitlements  under the Executive  Benefit Plan when settlement
occurs in accordance with Section 10 of the Restated  Agreement.  Section 300 of
the Income Tax  Regulations  establishes  the  procedure  applicable in using an
after-tax lump sum to purchase a prescribed annuity:

1.     A prescribed  annuity payment consists of two components:  (a) the deemed
       capital  element of the annuity  payment on which no tax is payable,  and
       (b) the deemed non-capital  portion of the annuity payment which is taxed
       at the marginal rate.

2.     The capital  portion of each future annuity payment is considered to be a
       return of the original after-tax lump sum amount.

3.     The non-capital portion of each annuity payment is assumed to be provided
       by the  investment  return on the original  after-tax lump sum amount and
       has therefore not yet been taxed.

4.     A constant  percentage of each future payment is deemed to be a return of
       the original lump sum capital.

CALCULATION METHODOLOGY

1.     Equivalent after-tax payments:

a.     Determine  initial gross annual pension  entitlement  under the Executive
       Benefit Plan.

b.     Determine  after-tax  annual  pension  entitlement  under  the  Executive
       Benefit Plan based on Individual Tax Rate as defined in Schedule "B-1".


<PAGE>
                                     - 2 -


c.     Determine the capital element based on the  non-indexed  present value of
       the pension payments divided by life expectancy.

d.     Determine the monthly  payment which provides an after-tax  pension equal
       to the after-tax pension  determined in 1.b. above in accordance with the
       prescribed annuity methodology.

2.     Present value of periodic payments from 1. above:

a.     Determine the present value of the pension determined in 1.d. above using
       the  assumptions  described  below in this  Schedule  "B-1".  For greater
       certainty, the value of the post-retirement indexation is to be reflected
       in determining  the present value of the accrued  pension  entitlement in
       respect  of  post-1992  service,  and any  accrued  pension in respect of
       service granted during the Severance Period.

3.     Tax adjustment:

a.     Gross-up the present value  determined  in 2.a.  above to reflect the tax
       assumed to be required to be paid on the lump sum.

b.     Gross-up the amount  determined in 3.a.  above to reflect the tax assumed
       to be required to be paid on  investment  earnings in respect of the lump
       sum  payment  during  the  deferral   period  prior  to  assumed  pension
       commencement, if any.

4.     Equivalent present value after tax as the after-tax monthly payments:

a.     The amount  determined  in 3.b.  above  shall be the lump sum  settlement
       value of the Executive's pension entitlement.

ASSUMPTIONS

Interest Discount Rate:

--  during deferral period                 Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately  preceding  the  date  of
                                           calculation,  rounded  down  to  next
                                           lower 0.5.

--  after assumed pension commencement     Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately  preceding  the  date  of
                                           calculation,  rounded  down  to  next
                                           lower 0.5,

                                           less


<PAGE>
                                     - 3 -


                                           assumed  escalation of pensions after
                                           retirement.

Increase in Consumer Price Index:          Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately  preceding  the  date  of
                                           calculation,

                                           less

                                           Yield  on  long-term   Government  of
                                           Canada Real Return bonds as published
                                           in  the   Bank  of   Canada   Review,
                                           described  in CANSIM  series  V122553
                                           (or a successor  series) for the last
                                           trading  Wednesday  at the end of the
                                           month immediately  preceding the date
                                           of calculation.

                                           The result of the  difference is then
                                           rounded up to the next highest 0.5% .

Escalation of Pensions After Retirement:   75% of CPI, less 1% (minimum increase
                                           25% of CPI). Applies only to benefits
                                           accrued  for service  after  December
                                           31, 1992.

MORTALITY:

--  for life expectancy                    1994  Uninsured  Pensioner  Mortality
                                           Table  with  mortality   improvements
                                           projected to 15 years beyond the date
                                           of termination.

--  for present values

       o  prior to assumed pension         Nil.
          commencement

       o  after assumed pension            1994  Uninsured  Pensioner  Mortality
          commencement                     Table  with  mortality   improvements
                                           projected 15 years beyond the date of
                                           termination.

Marital Status:                            Actual status at date of termination.

Age of Spouse:                             Based on actual date of birth.

Individual Tax Rate:                       Maximum individual  marginal tax rate
                                           for employee's province of employment
                                           at the date of termination.

<PAGE>

                                 SCHEDULE "B-2"
                                 --------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS

METHODOLOGY  AND  ASSUMPTIONS FOR DETERMINING THE AMOUNT TO BE SECURED OR FUNDED
IN  ACCORDANCE  WITH SECTION 10 BASED ON THE  METHODOLOGY  DESCRIBED IN SCHEDULE
"B-1"


PURPOSE

The purpose of this Schedule "B-2" is to provide the actuarial  methodology  and
assumptions  for  determining  the amount to be secured or funded in  accordance
with Section 10 of the Restated Agreement.

METHODOLOGY

The settlement methodology is described in Schedule B-1.

The funding methodology  applicable to the Executive Benefit Plan Obligations is
based on the following:

1.     Estimate the accrued pension  payable from the Executive  Benefit Plan as
       at the Valuation Date.

2.     Assume  that  the  assets  of the plan are to be  invested  in long  term
       Government  of  Canada  bonds  and  subject  to the  50%  refundable  tax
       applicable to retirement compensation arrangements.

3.     Determine the present value of the amounts in 1 through 2 above.

4.     Estimate the settlement  value that could be paid in accordance  with the
       methodology and assumptions described in Schedule B-1.

5.     The funding amount in respect of the Executive  Benefit Plan  Obligations
       shall be the  greater  of the  amount  determined  in  accordance  with 1
       through 3 above and the amount in 4 above.

ASSUMPTIONS

Interest Discount Rate:

--  during deferral period                 Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately preceding the Anniversary
                                           Date, rounded down to next lower 0.5.


<PAGE>
                                     - 2 -


--  after assumed pension commencement     Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately preceding the Anniversary
                                           Date, rounded down to next lower 0.5,
                                           less assumed  escalation  of pensions
                                           after retirement.

Increase in Consumer Price Index:          Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately preceding the Anniversary
                                           Date,

                                           less

                                           Yield  on  long-term   Government  of
                                           Canada Real Return bonds as published
                                           in  the   Bank  of   Canada   Review,
                                           described  in CANSIM  series  V122553
                                           (or a successor  series) for the last
                                           trading  Wednesday  at the end of the
                                           month   immediately   preceding   the
                                           Anniversary Date.

                                           The result of the  difference is then
                                           rounded up to the next highest 0.5%.

Escalation of Pensions After Retirement:   75% of CPI, less 1% (minimum increase
                                           25% of CPI). Applies only to benefits
                                           accrued  for service  after  December
                                           31, 1992.

MORTALITY:

-- for life expectancy                     1994  Uninsured  Pensioner  Mortality
                                           Table  with  mortality   improvements
                                           projected  to  15  years  beyond  the
                                           Calculation Date.

-- for present values

    o  prior to assumed pension            Nil.
       commencement

    o  after assumed pension               1994  Uninsured  Pensioner  Mortality
       commencement                        Table  with  mortality   improvements
                                           projected   15   years   beyond   the
                                           Calculation Date.


<PAGE>
                                     - 3 -


Marital Status:                            Actual status at the Anniversary.

Age of Spouse:                             Based on actual date of birth.

Individual Tax Rate:                       Maximum individual  marginal tax rate
                                           for employee's province of employment
                                           at the Anniversary Date

Bonus:                                     Target  bonus % applied to the salary
                                           rate at the Valuation Date

Investment return:                         Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately preceding the Anniversary
                                           Date rounded down to next lower 0.5%,
                                           and then divided by 2

Decrements:                                None  assumed  prior  to  Calculation
                                           Date

Eligibility for Pensions:                  100% vested

Pension Commencement Age:

--   eligible for subsidized early         Payable  at  the  completion  of  the
     retirement on the Calculation Date    Severance  Period.   Payable  at  the
     (i.e., age 55 and 10 years of         Calculation   Date  for  purposes  of
     continuous service)                   determining the amount required under
                                           Section 10.6(e).

--   not eligible for early retirement     Deferred  to age 60 or the end of the
     on the Calculation Date               Severance Period if later. Payable at
                                           age 60 for  purposes  of  determining
                                           the  amount  required  under  Section
                                           10.6(e).

Fluctuation reserve (1)                    15% of the pension obligations

Cost of borrowing to settle the            Yield  on  one  month  Government  of
obligations:                               Canada Treasury Bills as published in
                                           the Bank of Canada Review,  described
                                           in  CANSIM   series   V122529  (or  a
                                           successor   series)   for  the   last
                                           trading  Wednesday  at the end of the
                                           month   immediately   preceding   the
                                           Anniversary  Date,  rounded up to the
                                           next higher 0.25%, plus 1.50%


<PAGE>
                                     - 4 -





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

Notes:

(1)   Referred to by Section 10.5(g), Section 10.6(e)(viii) and 10.6(e)(x).  The
      15% load is intended to provide a reserve for a potential  decrease in the
      Interest  Discount Rate in  combination  with  potential  increases in the
      Consumer Price Index for an aggregate change of 1.0%.




<PAGE>

                                  SCHEDULE "C"
                                  ------------

           AMENDED AND RESTATED AGREEMENT RESPECTING CHANGE OF CONTROL
                    AND EXECUTIVE BENEFIT PLAN ENTITLEMENTS
                    ESTIMATED(1) ENTITLEMENT TO COMPENSATION
                 PURSUANT TO ARTICLE 7 OF THE RESTATED AGREEMENT


-------------------------------------------------------------------------------
Employee - Laurence Murphy
-------------------------------------------------------------------------------
Base Salary                                                         $1,387,500
-------------------------------------------------------------------------------
Bonus Target Value                                                    $832,500
-------------------------------------------------------------------------------
Benefits Uplift                                                       $180,375
-------------------------------------------------------------------------------
Car Allowance                                                          $48,000
-------------------------------------------------------------------------------
Savings Plan                                                           $83,250
-------------------------------------------------------------------------------
Financial Counselling Services                                         $10,500
-------------------------------------------------------------------------------
Security Monitoring Services                                            $2,400
-------------------------------------------------------------------------------

TOTAL VALUE                                                         $2,544,525
-------------------------------------------------------------------------------

Additional Lump Sum Settlement Value of Pension(2)                  $3,686,478
-------------------------------------------------------------------------------

TOTAL ESTIMATED ENTITLEMENT                                         $6,231,003
-------------------------------------------------------------------------------

In addition to the above,  Section 7.1(c) of the Restated Agreement provides for
Executive  Outplacement  counselling  to be provided  by a firm  selected by the
Executive, at a cost to the Corporation not to exceed $25,000.

IN ADDITION to the above pension entitlement under the Agreement,  the Executive
has the following  pension  entitlements  under the Defined  Benefit  Registered
Pension Plan and  Executive  Benefit Plan. As is the case with the figures shown
above,  these  values  are  estimated  values  (as of April 1, 2008) and are for
illustrative  purposes only.  Actual values will be calculated as of the date of
the  entitlement or payment in accordance  with the Defined  Benefit  Registered
Pension Plan and the Executive Benefit Plan, respectively,  and therefore may be
subject to change.

o    Accrued Annual Defined Benefit Pension Entitlement                  $50,372
     (Registered Pension Plan)(3)

o    Estimated Lump Sum Value of Executive Benefit Plan(4)            $3,354,861





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

(1)  As stated in Section 7.1 of the Restated Agreement,  the above calculations
     represent  only the  current  estimated  value (as of April 1, 2008) of the
     Executive's   entitlement  to  compensation   upon  a  Change  of  Control.
     Accordingly, the above calculations are for illustrative purposes only.

(2)  Calculated in accordance with Section 7.1(b) of the Restated Agreement.

     -   Adjustment to EBP lump sum value to reflect settlement $1,327,589.

     -   Additional  settlement  value of pension  accrued  during the severance
         period upon a change of control $2,358,889.

(3)  Benefit payable immediately at April 1, 2008.

(4)  Based on the Standards of Practice for Determining  Pension Commuted Values
     approved by the Canadian  Institute of Actuaries using rates applicable for
     April 2008 terminations.

<PAGE>


                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS

This amended and restated  agreement  respecting change of control and executive
benefit plan entitlements made as of the 19th day of September, 2008.


BETWEEN:

                  NEXEN INC.,  a  corporation  incorporated  under the
                  laws of Canada

                                  (hereinafter referred to as the "Corporation")

                                     - and -

                  ROGER THOMAS

                                    (hereinafter referred to as the "Executive")

RECITALS:

1.     The  Executive,  as  Executive  Vice  President,  North  America  of  the
       Corporation,  is considered  by the Board to be an essential  officer and
       employee of the  Corporation,  who is both  integral to the operation and
       development  of the  Corporation,  and has acquired  outstanding  skills,
       unique experience and possesses an extensive background in, and knowledge
       of, the Corporation's  business,  operations and the industry in which it
       is engaged.

2.     In the  event of a Change of  Control,  there is a  possibility  that the
       employment  of the Executive  would be  terminated  without just cause or
       adversely modified and the Executive has expressed concern in that regard
       to the Corporation.

3.     The Board  recognizes  that it is essential and in the best  interests of
       the Corporation  and its  shareholders  that the  Corporation  retain the
       continued  dedication of the Executive to the Executive's  office and the
       Executive's  employment  during the uncertain period prior to, during and
       following a Change of Control.

4.     The Board further believes that the past service of the Executive and the
       Executive's  integral  role  in  the  development  and  operation  of the
       Corporation  requires that the Corporation  ensure that in the event of a
       Change of Control  the  Executive  is  treated in a manner  that is fair,
       reasonable,  consistent with industry standards and in the best interests
       of the Corporation.

5.     The  Corporation  and the  Executive  entered  into a Change  of  Control
       Agreement on October 22, 1999, which was amended by an Amending Agreement
       dated December 25, 2000 (collectively the "Original  Agreement") to agree
       on the terms  and  conditions  which  would  govern  the  termination  or
       modification  of the  employment of the  Executive  following a Change of
       Control.

<PAGE>
                                     - 2 -


6.     The Original  Agreement  was replaced  and  superseded  by an Amended and
       Restated  Change of Control  Agreement on December  31,  2001,  which was
       amended by an Amending  Agreement dated May 30, 2003  (collectively,  the
       "Current   Agreement")   which,   among  other   matters,   detailed  the
       Corporation's  security and funding  obligations in respect of the Change
       of  Control  Obligations  (as  hereinafter  defined),  provided  for  the
       securitization  and funding of the Executive Benefit Plan Obligations (as
       hereinafter  defined) and provided for the  cessation of the  Executive's
       coverage  under  the  Statement  of  Company   Procedure   Regarding  the
       Securitization of Nexen Inc. Restated  Executive Benefit Plan, as amended
       or replaced from time to time (the "Securitization Procedure").

7.     The Corporation and the Executive wish to amend the Current  Agreement as
       herein  provided and, in doing so, wish to restate the Current  Agreement
       as herein amended (the "Restated Agreement").

NOW THEREFORE, in consideration of the mutual covenants and agreements set forth
in this Restated  Agreement and for other good and valuable  consideration,  the
receipt and  sufficiency of which are hereby  acknowledged  by the Parties,  the
Parties agree as follows:

                                    ARTICLE 1
                                   DEFINITIONS
                                   -----------

1.1    In this Restated Agreement, the following terms shall mean as follows:

       (a)    "ACTING  JOINTLY OR IN CONCERT" for the purposes of this  Restated
              Agreement,  a Person is acting  jointly or in concert with another
              Person  if  such  Person  has  any   agreement,   arrangement   or
              understanding  (whether  formal or informal  and whether or not in
              writing)  with such  other  Person for the  purpose of  acquiring,
              offering  to  acquire,   or  voting  any  Common   Shares  of  the
              Corporation  (other  than  customary  agreements  with and between
              underwriters  and  banking  group or selling  group  members  with
              respect to a  distribution  of  securities by way of prospectus or
              private  placement  or pursuant to a pledge of  securities  in the
              ordinary course of business).

       (b)    "ACTUARY"  has the  meaning  referred  to in Section  10.2 of this
              Restated Agreement.

       (c)    "AFFILIATE"  and  "ASSOCIATE"  have the  meaning  ascribed to such
              terms in National Instrument 45-106.

       (d)    "ANNIVERSARY  DATE" has the meaning referred to in Section 10.3 of
              this Restated Agreement.

<PAGE>
                                     - 3 -


       (e)    "ANNUAL BASE SALARY" means the annual base salary of the Executive
              payable  by the  Corporation  at the end of the month  immediately
              preceding the Date of Termination.

       (f)    "ANNUAL TARGET BONUS" means the Executive's annual target bonus as
              determined  by the Board to be in effect for the calendar  year in
              which a Change of Control occurs.

       (g)    "BANK"  has  the  meaning  referred  to in  Section  10.2  of this
              Restated Agreement.

       (h)    "BENEFICIAL OWNER" for the purposes of this Restated Agreement,  a
              Person  shall be deemed to be the  "BENEFICIAL  OWNER" and to have
              "BENEFICIAL OWNERSHIP" of and to "BENEFICIALLY OWN":

              (i)    any  securities  as to  which  such  Person  or any of such
                     Person's Affiliates or Associates is the owner at law or in
                     equity;

              (ii)   any  securities  as to  which  such  Person  or any of such
                     Person's  Affiliates or  Associates  has a right to acquire
                     (i) upon the exercise of any Convertible Securities or (ii)
                     pursuant to any agreement,  arrangement  or  understanding,
                     whether  such  right is  exercisable  immediately  within a
                     period of sixty (60) days  thereafter and whether or not on
                     condition or the happening of any contingency,  (other than
                     (a) customary  agreements with and between underwriters and
                     banking group and selling group members with respect to the
                     distribution  to  the  public  or  pursuant  to  a  private
                     placement  of  securities,  or (b)  pursuant to a pledge of
                     securities in the ordinary course of business); and

              (iii)  any  securities  which are  Beneficially  Owned  within the
                     meaning  of  clauses  (a) or (b) above by any other  Person
                     with which such Person is Acting Jointly or in Concert,

              provided,   however,  that  a  Person  shall  not  be  deemed  the
              "Beneficial  Owner"  or to have  "Beneficial  Ownership"  of or to
              "Beneficially   Own"  any  security   where  such  Person  is  the
              registered  holder of  securities  as a result of  carrying on the
              business of or acting as nominee for a securities depository.

              For purposes of this Restated Agreement,  the percentage of Common
              Shares Beneficially Owned by any Person, shall be and be deemed to
              be the product determined by the formula:

              100 x A/B

              Where:

              A  =  the  number  of  votes  for the  election  of all  directors
                    generally  attaching to the Common Shares Beneficially Owned
                    by such Person; and

<PAGE>
                                     - 4 -


              B  =  the  number  of  votes  for the  election  of all  directors
                    generally attaching to all outstanding Common Shares.

              For  the  purposes  of  the  foregoing  formula,  where  a  Person
              Beneficially  Owns  unissued  Common  Shares which may be acquired
              pursuant to  Convertible  Securities,  such Common Shares shall be
              deemed  to be  outstanding  for the  purpose  of  calculating  the
              percentage of Common Shares  Beneficially  Owned by such Person in
              both the  numerator  and the  denominator,  but no other  unissued
              Common  Shares  which  may  be  acquired  pursuant  to  any  other
              outstanding Convertible Securities shall, for the purposes of that
              calculation, be deemed to be outstanding.

       (i)    "BOARD"  means  the  Board  of  Directors  of the  Corporation  as
              constituted from time to time.

       (j)    "CBCA" means the Canada Business Corporations Act, as amended from
              time to time, and any successor legislation thereto.

       (k)    "CALCULATION  DATE" has the meaning referred to in Section 10.5 of
              this Restated Agreement.

       (l)    "CHANGE OF CONTROL" means the occurrence of any of:

              (i)    the  purchase  or  acquisition  of  any  Common  Shares  or
                     Convertible  Securities by a Beneficial Owner which results
                     in the Beneficial  Owner owning,  or exercising  control or
                     direction  over,  Common Shares or  Convertible  Securities
                     such that,  assuming  only the  conversion  of  Convertible
                     Securities  Beneficially  Owned or over  which  control  or
                     direction  is  exercised  by  the  Beneficial   Owner,  the
                     Beneficial   Owner  would  own,  or  exercise   control  or
                     direction  over,  Common Shares  carrying the right to cast
                     more than thirty-five  percent (35%) of the votes attaching
                     to all Common Shares; or

              (ii)   the  substantial   completion  of:  (i)  the   liquidation,
                     dissolution or winding-up of the  Corporation;  or (ii) the
                     sale,  lease or other  disposition of all or  substantially
                     all of the assets of the Corporation; or

              (iii)  a situation  in which  individuals  who were members of the
                     Board immediately prior to:

                     (A)    a meeting  of the  shareholders  of the  Corporation
                            involving  a  contest  for,  or an item of  business
                            relating to, the election of directors; or

                     (B)    an  amalgamation,   arrangement,   merger  or  other
                            consolidation or combination of the Corporation with
                            another Person,

<PAGE>
                                     - 5 -


                     shall not constitute a majority of the Board following such
                     election or transaction; or

              (iv)   the completion of any  transaction or the first of a series
                     of transactions which would have the same or similar effect
                     as any transaction or series of transactions referred to in
                     paragraphs (i), (ii) or (iii) above; or

              (v)    a determination by the Board that, for the purposes of this
                     Restated Agreement,  a Change of Control has occurred or is
                     imminent.

       (m)    "CHANGE OF CONTROL OBLIGATIONS" means the Company's obligations to
              make  the lump  sum  payments  described  in  Section  7.1 of this
              Restated Agreement to the Executive.

       (n)    A "CHANGE OF CONTROL  OBLIGATIONS  -  DESIGNATED  EVENT"  shall be
              deemed to have occurred if:

              (i)    the  Corporation  fails to  arrange  for the  extension  or
                     replacement  of a Letter of Credit in  accordance  with the
                     terms of this Restated Agreement; or

              (ii)   the Executive's employment is terminated in accordance with
                     Section 5.1 or 6.1 of this Restated Agreement.

       (o)    "COMMON SHARES" means the common shares of the Corporation.

       (p)    "CONVERTIBLE SECURITIES" means:

              (i)    any right  (contractual  or  otherwise  and  regardless  of
                     whether  such  right  constitutes  a  security)  to acquire
                     Common Shares from the Corporation; or

              (ii)   any security  issued by the  Corporation  from time to time
                     (other than the rights issued  pursuant to a  shareholders'
                     rights  protection  plan,  if any)  carrying any  exercise,
                     conversion or exchange right,

              which is then exercisable or exercisable  within a period of sixty
              (60) days from that time pursuant to which the holder  thereof may
              acquire Common Shares or other  securities  which are  convertible
              into or  exercisable  or  exchangeable  for Common Shares (in each
              case, whether such right is then exercisable or exercisable within
              a period of sixty  (60) days from that time and  whether or not on
              condition or the happening of any contingency).

       (q)    "DATE OF  TERMINATION"  means the date upon which the  Executive's
              employment  is  terminated  pursuant to Section 4.1, 5.1 or 6.1 of
              this  Restated  Agreement.   For  greater  clarity,  the  Date  of
              Termination means the date upon which the Corporation provides the
              Executive   with   written,   verbal  or  other  notice  that  the
              Executive's  employment has been or will be terminated pursuant to

<PAGE>
                                     - 6 -


              Section  4.1 or 5.1 of this  Restated  Agreement  or the date upon
              which the Executive  provides the Corporation  with written notice
              terminating the Executive's  employment pursuant to Section 4.1 or
              for Good Reason pursuant to Section 6.1.

       (r)    "DISABILITY"  means,  where due to a physical or mental condition,
              the  Executive  is  rendered  totally  and  permanently  unable to
              perform the Executive's duties for a consecutive period of two (2)
              years or more during  which the  Executive  has been in receipt of
              long term disability insurance benefits from the insurance carrier
              normally utilized by the Corporation.

       (s)    "DISPUTE"  has the  meaning  referred  to in Section  11.1 of this
              Restated Agreement.

       (t)    "EFFECTIVE  DATE"  means the date upon  which a Change of  Control
              occurs.

       (u)    "EMPLOYMENT  BENEFITS" means the employment  benefits to which the
              Executive  is entitled by virtue of any  written,  oral or implied
              agreement with the Corporation.  For the purposes of this Restated
              Agreement, "Employment Benefits" shall include, but is not limited
              to, the following:

              (i)    the  Executive's  entitlement  to  any  dental  or  general
                     medical care;

              (ii)   the Executive's entitlement to receive long term disability
                     benefits from the insurance  carrier  normally  utilized by
                     the Corporation;

              (iii)  the Executive's  entitlement to pension  benefits under the
                     terms of any pension plan with the Corporation;

              (iv)   the Executive's entitlement to a monthly car allowance from
                     the Corporation;

              (v)    the  Executive's   entitlement  to   contributions  by  the
                     Corporation to the Corporation's savings plan;

              (vi)   the Executive's entitlement to receive from the Corporation
                     financial counseling  services,  at a cost of $3,500.00 per
                     year (or as the same may be increased  from time to time by
                     the Corporation); and

              (vii)  the Executive's entitlement to receive from the Corporation
                     security  monitoring  services at the Executive's  personal
                     residence.

       (v)    "EXECUTIVE  BENEFIT  PLAN" has the meaning  referred to in Section
              7.1(b) of this Restated Agreement.

       (w)    "EXECUTIVE  BENEFIT  PLAN  OBLIGATIONS"  means  the  Corporation's
              outstanding  obligations  under the Executive  Benefit Plan to the
              Executive.

<PAGE>
                                     - 7 -


       (x)    An "EXECUTIVE  BENEFIT PLAN OBLIGATIONS - DESIGNATED  EVENT" shall
              be deemed to have occurred if:

              (i)    a Change of Control occurs;

              (ii)   the  Corporation  makes an  assignment  for the  benefit of
                     creditors  or files a  petition  in  bankruptcy  or becomes
                     insolvent or bankrupt;

              (iii)  a receiver, trustee or liquidator of or for the Corporation
                     is appointed and is not discharged within a period of sixty
                     days;

              (iv)   the net worth of the Corporation,  described as shareholder
                     equity  in the  consolidated  financial  statements  of the
                     Corporation  as  disclosed  in  the  annual  and  quarterly
                     consolidated  financial  statements of the Corporation,  is
                     less than $400 million;

              (v)    the  Corporation  fails to  arrange  for the  extension  or
                     replacement  of a Letter of Credit in  accordance  with the
                     terms of this Restated Agreement;

              (vi)   the  Executive  has provided  written  notification  to the
                     Trustee  and  to the  Corporation  of  the  failure  by the
                     Corporation  to pay any amount owed to or in respect of the
                     Executive  under the  Executive  Benefit Plan within thirty
                     days of the due date  specified  in the  Executive  Benefit
                     Plan  (together  with a  statement  of the  amount  due and
                     owing) either to the person  entitled  thereto  pursuant to
                     the  Executive  Benefit Plan or to the Trust in  accordance
                     with the provisions of Section 10.6(h); or

              (vii)  at any time the Board  adopts a  resolution  to the  effect
                     that, for purposes of this Restated Agreement, an Executive
                     Benefit Plan Obligations - Designated Event has occurred or
                     is imminent.

       (y)    "GOOD  REASON"  means any of the  following,  unless the Executive
              shall have given the Executive's express written consent thereto:

              (i)    INCONSISTENT DUTIES. The assignment to the Executive of any
                     duties  inconsistent  with  the  Executive's  status  as an
                     executive   officer  of  the   Corporation  or  a  material
                     alteration  in the  nature  or  status  of the  Executive's
                     responsibilities  or duties or reporting  relationship from
                     those in effect immediately prior to a Change of Control;

              (ii)   REDUCED  SALARY.  A  reduction  by the  Corporation  in the
                     Executive's  Annual Base Salary in effect on the  Effective
                     Date or as the same may be increased  thereafter  from time
                     to time or the  failure  by the  Corporation  to grant  the
                     Executive salary increases at a rate  commensurate with the
                     increases accorded to other executives of the Corporation;

<PAGE>
                                     - 8 -


              (iii)  RELOCATION.  The Corporation  requiring the Executive to be
                     based  anywhere  other than where the Executive is based at
                     the time a Change of Control  occurs,  except for  required
                     travel  on  the   Corporation's   business   to  an  extent
                     substantially  consistent  with  the  Executive's  business
                     travel  obligations  in the  ordinary  course  of  business
                     immediately prior to a Change of Control;

              (iv)   INCENTIVE   COMPENSATION   PLANS.   The   failure   by  the
                     Corporation   to   continue   in   effect   any   incentive
                     compensation  plan in  which  the  Executive  participates,
                     including,  but not limited to, the Incentive  Compensation
                     Plan or the Stock  Option Plan or any other  similar  plans
                     adopted prior to a Change of Control,  unless the Executive
                     is  eligible  to  participate  in, and is  entitled  to the
                     opportunity  to  receive  a  comparable  level of  benefits
                     under, an ongoing, substitute or alternative plan (it being
                     understood  that the  manner or method of  payment  and the
                     form of  consideration  need not be the same as  existed in
                     the original  plans);  or the failure by the Corporation to
                     continue the Executive's  participation therein on at least
                     as  favourable  a basis,  both in terms  of the  amount  of
                     benefits  available to the  Executive  and the level of the
                     Executive's  participation  relative to other participants,
                     as existed at the time a Change of Control occurs;

              (v)    EMPLOYMENT  BENEFITS  AND  PERQUISITES.  The failure by the
                     Corporation  to  continue  to provide  the  Executive  with
                     Employment Benefits at least as favourable as those enjoyed
                     by the Executive  immediately prior to a Change of Control,
                     including any pension plan,  benefit plan or any retirement
                     arrangement  established  for the Executive,  or any of the
                     Corporation's life insurance, medical, health and accident,
                     disability  or  savings  plans in which the  Executive  was
                     participating  at the time a Change of Control occurs;  the
                     taking of any action by the Corporation that would directly
                     or  indirectly  materially  reduce  any  such  benefits  or
                     deprive the Executive of any material perquisite enjoyed by
                     the  Executive  at the time a  Change  of  Control  occurs,
                     including, without limitation and to the extent applicable,
                     the use of a car, aircraft,  secretarial  services,  office
                     space,    telephones,    computer    facilities,    expense
                     reimbursement, financial counselling, and professional fees
                     and  club  dues  reimbursement;   or  the  failure  by  the
                     Corporation  to provide  the  Executive  with the number of
                     paid  vacation  days to which the  Executive is entitled in
                     accordance with the Corporation's  normal vacation practice
                     in effect at the time a Change of Control occurs;

              (vi)   NO ASSUMPTION BY SUCCESSOR.  The failure of the Corporation
                     to obtain a  satisfactory  agreement  from a  successor  to
                     assume  and  agree  to  perform  this  Restated  Agreement.
                     Alternatively, if the business or undertaking in connection
                     with  which  the   Executive's   services  are  principally
                     performed  is sold at any time  after a Change  of  Control
                     occurs, and the Executive's  employment is transferred as a

<PAGE>
                                     - 9 -


                     result,  the  failure or refusal of the  purchaser  of such
                     business or  undertaking  to provide the Executive with the
                     same or a comparable  position,  duties,  compensation  and
                     benefits, as described in paragraphs (iv) and (v) above, as
                     provided to the  Executive by the  Corporation  immediately
                     prior to a Change of Control;

              (vii)  DISPOSITION OF "ALL OR SUBSTANTIALLY  ALL". The disposition
                     by  the  Corporation  of all  or  substantially  all of the
                     assets  of  the   Corporation,   as  contemplated   herein,
                     notwithstanding  that the Executive's services were or were
                     not principally performed for such business.

       (z)    "HEARING"  has the  meaning  referred  to in Section  11.7 of this
              Restated Agreement.

       (aa)   "HEARING DATE" has the meaning referred to in Section 11.7 of this
              Restated Agreement.

       (bb)   "INCENTIVE   COMPENSATION  PLAN"  means  any  bonus  or  incentive
              compensation  plan of the  Corporation  in which the  Executive is
              entitled to receive benefits in the month immediately  preceding a
              Change of Control.

       (cc)   "JUST CAUSE" means:

              (i)    the failure by the Executive to  substantially  perform the
                     Executive's   duties   according   to  the   terms  of  the
                     Executive's  employment in existence immediately prior to a
                     Change  of  Control  after  the  Corporation  has given the
                     Executive   reasonable   notice  of  such   failure  and  a
                     reasonable opportunity to correct it; or

              (ii)   where  the  Executive   engages  in  any  criminal  act  or
                     dishonesty  resulting  or intended  to result,  directly or
                     indirectly,  in the personal  gain of the  Executive at the
                     Corporation's expense.

       (dd)   "LETTER OF CREDIT" has the meaning  referred to in Section 10.2 of
              this Restated Agreement.

       (ee)   "MONTHLY  BASE  SALARY"  means the monthly  salary  payable to the
              Executive  by the  Corporation  in  effect at the end of the month
              immediately preceding the Effective Date.

       (ff)   "NOTICE OF DISPUTE" has the meaning referred to in Section 11.1 of
              this Restated Agreement.


<PAGE>
                                     - 10 -


       (gg)   "OBLIGATIONS"   means,   collectively,   the   Change  of  Control
              Obligations and the Executive Benefit Plan Obligations.

       (hh)   "PARTIES" means the Corporation,  and its successors and permitted
              assigns,  and the Executive and the Executive's  heirs,  executors
              and administrators and "PARTY" means either one of them.

       (ii)   "PERSON" includes an individual,  partnership,  association,  body
              corporate, trustee, executor, administrator,  legal representative
              and any national, provincial, state or municipal government or any
              agency thereof.

       (jj)   "REFUNDABLE   TAX  ACCOUNT"   means  the  refundable  tax  account
              maintained in respect of the Trust by the Canada Revenue Agency.

       (kk)   "REGISTERED  PENSION PLAN" has the meaning  referred to in Section
              7.1(b) of this Restated Agreement.

       (ll)   "RESTATED  AGREEMENT"  means this amended and  restated  agreement
              respecting   change  of  control  and   executive   benefit   plan
              entitlements as it may be amended,  restated or supplemented  from
              time to time, and the expressions  "hereof",  "herein",  "hereto",
              "hereunder",  "hereby",  and  similar  expressions  refer  to this
              Restated  Agreement  and,  unless  otherwise  indicated,  refer to
              Articles or Sections in this Restated Agreement only.

       (mm)   "SECURITIZATION  PROCEDURE"  has the  meaning  referred  to in the
              recitals of this Restated Agreement.

       (nn)   "SEVERANCE  PERIOD" means the thirty (30) month period immediately
              following the Date of Termination.

       (oo)   "STOCK  OPTION  PLAN" means any stock  option plan or plans of the
              Corporation  pursuant to which the Executive is granted options by
              the Corporation to acquire Common Shares.

       (pp)   "SUBSIDIARY" has the meaning ascribed to it in the CBCA.

       (qq)   "TAX ACT" means the Income Tax Act  (Canada)  and the  Regulations
              thereunder, both as amended from time to time.

       (rr)   "TERM" has the meaning referred to in Section 3.1 of this Restated
              Agreement.

       (ss)   "TRUST"  has  the  meaning  referred  to in  Section  10.1 of this
              Restated Agreement.

       (tt)   "TRUST  AGREEMENT" has the meaning  referred to in Section 10.1 of
              this Restated Agreement.

       (uu)   "TRUSTEE"  means CIBC  Mellon  Trust  Company or such other  trust
              company duly incorporated under the laws of Canada or any province
              thereof  whom  the  Company  may   designate  as  the  trustee  in
              connection with the security and funding of the Obligations.


<PAGE>
                                     - 11 -


       (vv)   "VALUATION  DATE" has the meaning  referred to in Section  10.3 of
              this Restated Agreement.


                                   ARTICLE 2
                           SCOPE OF RESTATED AGREEMENT
                           ---------------------------

2.1    The  Parties  intend  that  this  Restated  Agreement  sets out (a) their
       respective  rights and  obligations  upon the  occurrence  of a Change of
       Control  and in  connection  with the  securitization  and funding of the
       Change of  Control  Obligations;  and (b)  their  respective  rights  and
       obligations  regarding  the  securitization  and funding of the Executive
       Benefit Plan  Obligations.  This Restated  Agreement does not provide for
       any  other  terms of the  Executive's  employment  with the  Corporation,
       except as expressly provided for herein.

2.2    The Parties hereby confirm that except as otherwise  expressly  stated in
       this Restated Agreement, insofar as the securitization and funding of the
       Executive  Benefit  Plan  Obligations  is  concerned,  the  terms of this
       Restated  Agreement  shall  govern  and the  terms of the  Securitization
       Procedure shall not be applicable.

2.3    This Restated Agreement shall  automatically  terminate upon the death of
       the  Executive  or where  due to the  Disability  of the  Executive,  the
       Executive is materially  incapacitated  from  performing the  Executive's
       duties.  In the event of the death or  Disability of the  Executive,  the
       Executive (or the  Executive's  estate) shall be entitled to receive from
       the  Corporation  all unpaid  Annual Base  Salary,  Employment  Benefits,
       unpaid business expenses and vacation  entitlement accrued to the date of
       the  death  or  Disability  of  the  Executive.  The  Executive  (or  the
       Executive's  estate)  shall also be entitled to receive any and all death
       or Disability benefits in a manner consistent with, and at least equal in
       amount to, those  provided by the  Corporation  to senior  executives (or
       their  estate)  under such plans,  programs and policies in effect at the
       date of Disability or death of the Executive,  and the Corporation  shall
       have no further  obligations to the Executive or the  Executive's  estate
       under this Restated Agreement.  Any entitlements of the Executive (or the
       Executive's  estate)  under  the  Executive  Benefit  Plan  which  remain
       following the  termination  of this Restated  Agreement  pursuant to this
       Section 2.3 shall then  commence to be covered  under the  Securitization
       Procedure.

2.4    If the  Executive's  employment is  terminated  by either Party,  for any
       reason,  prior to a Change of Control in any manner, other than expressly
       provided for in this Restated  Agreement,  this Restated  Agreement shall
       automatically  terminate  and  the  Corporation  shall  have  no  further
       obligations to the Executive hereunder. Any remaining entitlements of the
       Executive  under the  Executive  Benefit Plan which remain  following the
       termination of this Restated Agreement pursuant to this Section 2.4 shall
       then commence to be covered under the Securitization Procedure.



<PAGE>
                                     - 12 -


                                   ARTICLE 3
                           TERM OF RESTATED AGREEMENT
                           --------------------------

3.1    Subject to  termination of this Restated  Agreement  prior to a Change of
       Control,  this  Restated  Agreement  shall  remain in effect for a period
       concluding  twelve (12) months following the Effective Date (the "Term"),
       at which time this Restated  Agreement shall terminate;  provided however
       that the payment of compensation and benefits to the Executive under this
       Restated  Agreement  shall  continue  beyond  the  end  of  the  Term  in
       accordance with the applicable provisions of this Restated Agreement. Any
       remaining  entitlements of the Executive under the Executive Benefit Plan
       which  remain  following  the  termination  of  this  Restated  Agreement
       pursuant to this Section 3.1 shall then  commence to be covered under the
       Securitization Procedure.


                                   ARTICLE 4
            TERMINATION FOR JUST CAUSE OR FOR OTHER THAN GOOD REASON
            --------------------------------------------------------

4.1    If the  Executive's  employment  is  terminated  for  Just  Cause,  or is
       terminated  by the  Executive,  other than for Good  Reason,  following a
       Change of Control,  the  Corporation  shall pay to the Executive,  if not
       already  paid,  the  fraction of the unpaid  Annual  Base Salary  accrued
       during the then  current  fiscal  year of the  Corporation,  all  accrued
       Employment  Benefits,  all unpaid  reasonable  business  expenses and all
       unpaid  vacation pay accrued up to and including the Date of Termination,
       and thereafter,  the Corporation shall have no further obligations to the
       Executive under this Restated Agreement.

4.2    Nothing in this  Restated  Agreement  shall  serve to  derogate  from the
       vested rights of the Executive to pension benefits, Stock Option Plans or
       any other  Employment  Benefits to which the  Executive is entitled up to
       the Date of Termination.


                                   ARTICLE 5
                           TERMINATION BY CORPORATION
                           --------------------------

5.1    If the Executive's employment is terminated by the Corporation within the
       twelve (12) month period  following the Effective  Date, for reason other
       than Just Cause,  death or Disability,  the Corporation  shall pay to the
       Executive  the  remuneration  referred  to in Article 7 of this  Restated
       Agreement.


                                   ARTICLE 6
                           TERMINATION FOR GOOD REASON
                           ---------------------------

6.1    In the event of a Change of Control, the Executive may, within the twelve
       (12) month period  following  the Effective  Date and upon  providing the
       Corporation with ten (10) days written notice,  terminate the Executive's
       employment with the Corporation for Good Reason. Upon being provided with
       such notice,  the Corporation shall pay to the Executive the remuneration
       referred to in Article 7 of this Restated Agreement.

<PAGE>
                                     - 13 -


                                   ARTICLE 7
                          COMPENSATION UPON TERMINATION
                          -----------------------------

7.1    If the  Executive's  employment is terminated in accordance  with Section
       5.1 or 6.1 of this Restated Agreement:

       (a)    the Corporation shall forthwith,  but in any event within ten (10)
              days from receipt by the Corporation of a Release  executed by the
              Executive  substantially  in the form of Schedule  "A", pay to the
              Executive:

              (i)    if not  previously  paid,  that portion of the  Executive's
                     accrued but unpaid  Monthly  Base  Salary,  any accrued but
                     unpaid  bonus to which the  Executive  is entitled  for the
                     preceding  calendar year under any  Incentive  Compensation
                     Plan,  all  unpaid  reasonable  business  expenses  and all
                     accrued  but unused  vacation  pay earned or payable to the
                     Executive  by the  Corporation  for  the  period  from  the
                     beginning of the Corporation's then current fiscal year, up
                     to and including the Date of Termination;

              (ii)   a lump sum cash payment  equal to the  Executive's  Monthly
                     Base  Salary  and  one-twelfth  (1/12)  of the  Executive's
                     Annual Target Bonus for each month of the Severance Period;

              (iii)  a lump sum payment  equal to thirteen  percent (13%) of the
                     Executive's  Annual  Base Salary for the  Severance  Period
                     representing  the value of the  group  health  and  welfare
                     benefits for the Severance Period;

              (iv)   a  lump  sum   payment   representing   the  value  of  the
                     Executive's monthly car allowance for the Severance Period;

              (v)    a  lump  sum   payment   representing   the  value  of  the
                     Corporation's  contributions to the  Corporation's  savings
                     plan  (at a rate of six  percent  (6%)  of the  Executive's
                     Annual Base Salary) for the Severance Period;

              (vi)   a  lump  sum   payment   representing   the  value  of  the
                     Executive's  entitlement  to receive  from the  Corporation
                     financial counseling services for the Severance Period; and

              (vii)  a  lump  sum   payment   representing   the  value  of  the
                     Executive's  entitlement  to receive  from the  Corporation
                     security  monitoring  services at the Executive's  personal
                     residence for the Severance Period;

       (b)    with respect to the  Executive's  entitlement to pension  benefits
              under  the  Pension  Plan for  Employees  of Nexen  Inc.  (Defined
              Benefit Option) (the "Registered  Pension Plan"),  if any, and the
              Executive's  related  entitlement  under the Nexen  Inc.  Restated
              Executive Benefit Plan (the "Executive Benefit Plan"), if any:

<PAGE>
                                     - 14 -


              (i)    the Corporation  shall  recognize the Severance  Period for
                     purposes of determining the Executive's entitlement;

              (ii)   for calculation  purposes,  the Executive's  entitlement is
                     the benefit which would have been determined  assuming that
                     the Executive had been  employed  throughout  the Severance
                     Period, including recognition of:

                     (A)    additional service that would have been credited for
                            the Severance Period;

                     (B)    monthly salary equal to the Executive's Monthly Base
                            Salary throughout the Severance Period;

                     (C)    pensionable  bonus  for  the  year  of the  Date  of
                            Termination, and for each subsequent year or portion
                            thereof during the Severance  Period,  determined at
                            the Annual Target Bonus level. Average bonus will be
                            determined  over the  three  years to the end of the
                            Severance  Period,  including  any partial  calendar
                            years; and

                     (D)    if  the  Executive  would  have  been  eligible  for
                            retirement at the end of the Severance  Period,  the
                            Executive shall be deemed to retire, and the pension
                            to  commence,   upon  completion  of  the  Severance
                            Period.  In such case, the Executive's  attained age
                            at  the  end  of  the   Severance   Period  will  be
                            recognized  for  purposes of  calculating  the early
                            retirement reduction factor, if applicable; and

              (iii)  the pension  entitlements  described in this Section 7.1(b)
                     shall,  to the  extent  legally  permissible,  be  provided
                     through the Registered  Pension Plan. To the extent that it
                     is  not  legally   permissible   to  provide  such  pension
                     entitlements  through  the  Registered  Pension  Plan,  the
                     Corporation  shall pay to the  Executive a lump sum payment
                     representing   the  settlement   value  of  the  additional
                     Executive  Benefit Plan benefit  determined  in  accordance
                     with the assumptions set forth in Schedule "B-1";

              (iv)   any  entitlements  of the  Executive  under  the  Executive
                     Benefit   Plan  which  have   previously   been  funded  in
                     accordance  with Article 10 but not  previously  settled in
                     accordance   with  Article  10  shall  be  settled  by  the
                     Corporation in accordance with the assumptions set forth in
                     Schedule "B-1";

       (c)    the  Corporation   shall  provide  the  Executive  with  executive
              outplacement  counselling  to be provided by a firm to be selected
              by the  Executive,  at a cost  to the  Corporation  not to  exceed
              $25,000.00;

       (d)    all of the  Executive's  outstanding  unexercisable  stock options
              under any Stock Option Plan shall become exercisable; and


<PAGE>
                                     - 15 -


       (e)    where the  Executive  has been  relocated,  at the  request of the
              Corporation,  within the two (2) year period  immediately prior to
              the  Effective  Date,  if  so  requested  by  the  Executive,  the
              Corporation  shall relocate the Executive back to the  Executive's
              prior location.

7.2    The estimated value as of April 1, 2008 of Sections  7.l(a)(ii) to 7.1(c)
       are set out in Schedule "C". Schedule "C" provides  estimated values only
       and actual values shall be  calculated  in accordance  with this Restated
       Agreement  at the time of  entitlement  or payment  under  this  Restated
       Agreement.

7.3    If  the  Executive's   employment  is  terminated  in  the  circumstances
       described  in  Section  5.1  or  6.1  of  this  Restated  Agreement,  the
       remuneration  and  benefits  payable  under  this  Article 7 shall not be
       reduced if the Executive obtains alternative employment.

7.4    Unless  expressly  provided  otherwise in this  Restated  Agreement,  all
       payments  to be made to the  Executive  under  this  Article  7 shall  be
       subject to required statutory deductions at source by the Corporation.


                                   ARTICLE 8
                            CONFIDENTIAL INFORMATION
                            ------------------------

8.1    If the Executive's  employment is terminated in any manner whatsoever due
       to or  following  a Change  of  Control,  the  Executive  agrees  to keep
       confidential  all  information  of a confidential  or proprietary  nature
       concerning the Corporation,  its Affiliates,  Associates and Subsidiaries
       and their respective operations, opportunities, areas of present, past or
       future interests,  assets, finances,  technology,  intellectual property,
       business and  affairs,  and further  agrees not to use such  information,
       data or technology for personal  advantage,  provided that nothing herein
       shall prevent the disclosure of information  which is publicly  available
       or which is required to be disclosed by the Executive  under  appropriate
       statute, rules of law or legal process.


                                   ARTICLE 9
              RIGHTS AND OBLIGATIONS OF EXECUTIVE UPON TERMINATION
              ----------------------------------------------------

9.1    Subject to Section 8.1 of this Restated  Agreement,  the Executive  shall
       not be prohibited in any manner  whatsoever  from  obtaining  alternative
       employment  with or  otherwise  forming  or  participating  in a business
       competitive to the business of the  Corporation  after the termination of
       the Executive's employment with the Corporation.

9.2    Upon the  termination of the Executive's  employment for any reason,  the
       Executive shall tender the Executive's  resignation from any position the
       Executive may hold as an officer or director of the Corporation or any of
       its Affiliates, Associates or Subsidiaries.

9.3    If  the  Executive's   employment  is  terminated  in  the  circumstances
       described  in  Section  5.1  or  6.1  of  this  Restated  Agreement,  the
       Corporation  shall  continue  to  purchase  and  maintain,  to the extent
       available in the  marketplace at reasonable cost to the  Corporation,  on

<PAGE>
                                     - 16 -


       behalf of the Executive, director and officer liability insurance for the
       applicable  limitation period following the date upon which the Executive
       ceases to serve as a  director  or officer  of the  Corporation,  and the
       Executive's  existing agreement to receive indemnity from the Corporation
       for acts taken by the Executive in the Executive's capacity as an officer
       of the Corporation shall remain in effect.

9.4    Upon termination of the Executive's employment pursuant to Section 5.1 or
       6.1 of this  Restated  Agreement,  the  Corporation  shall  reimburse the
       Executive  for ongoing legal fees and  disbursements  which the Executive
       may reasonably incur in connection with this Restated Agreement (but this
       Restated  Agreement  only),   including  any  litigation  concerning  the
       validity or enforceability  of, or liability under, any provision of this
       Restated Agreement or any action by the Executive.  The Corporation shall
       pay such fees and  reimbursements to the Executive  promptly as such fees
       and disbursements become due.


                                   ARTICLE 10
                      SECURITIZATION AND FUNDING PROCEDURE
                      ------------------------------------

10.1   The  Corporation has established and maintains a trust for the benefit of
       the Executive and persons claiming through him (the "Trust")  pursuant to
       the terms and  conditions of a trust  agreement  (the "Trust  Agreement")
       between the  Corporation  and the  Trustee.  The Trust shall be funded in
       accordance  with the provisions of this Restated  Agreement and the Trust
       Agreement.

10.2   To provide  security  against a failure by the Corporation to either fund
       or settle the  Obligations  in accordance  with the terms of this Article
       10, the Trust  Agreement  provides  for the funding of the Trust with the
       proceeds  of  an  irrevocable   letter  of  credit  which  satisfies  the
       requirements  of this  Restated  Agreement  (a "Letter of Credit") in the
       event that the Corporation does not provide funding or effect  settlement
       when required to do so hereunder and in accordance with the terms hereof.
       The Corporation  confirms that the Letter of Credit currently held by the
       Trustee has been issued by a major  Canadian  chartered bank (the "Bank")
       in an amount calculated by the Corporation's  consulting  actuary (who at
       all times shall be a Fellow of the Canadian  Institute of Actuaries) (the
       "Actuary")  in  accordance  with the  provisions  of Section 10.5 of this
       Restated Agreement.

10.3   On each February 1st (the  "Anniversary  Date"),  the  Corporation  shall
       request a report from the Actuary as to the amount calculated,  as at the
       next succeeding April 1st (the "Valuation  Date"), in accordance with the
       provisions of Section 10.5 of this Restated  Agreement.  The  Corporation
       shall  provide  the Actuary  with the data it  requires  to prepare  such
       report.  Upon  completion  of each such  report,  the  Corporation  shall
       arrange for the Actuary to provide a summary of same to the Trustee.

       Prior to the  funding  and/or  settlement  of all of the  Obligations  in
       accordance  with the terms of this Restated  Agreement,  the  Corporation
       shall,  within forty-five days after the applicable  Anniversary Date and
       in accordance with the terms of the report received from the Actuary:

<PAGE>
                                     - 17 -


       (a)    either:

              (i)    arrange  for a Letter of Credit to be  provided by the Bank
                     to the Trustee to replace the Letter of Credit then held by
                     the Trustee. The replacement Letter of Credit shall be:

                     (A)    substantially  in the form of the  Letter  of Credit
                            then held by the Trustee;

                     (B)    in an amount  calculated  by the  Actuary  as at the
                            applicable  Valuation  Date in  accordance  with the
                            provisions   of  Section   10.5  of  this   Restated
                            Agreement; and

                     (C)    for a  term  which  commences  on  the  date  of its
                            issuance   and  expires  one  year   following   the
                            applicable Valuation Date; or

              (ii)   confirm to the Trustee in writing that the Letter of Credit
                     then held by the Trustee will be extended automatically for
                     a further  one-year term. The  confirmation  to the Trustee
                     shall include evidence from the Bank as to any amendment to
                     the applicable  Letter of Credit,  any such amendment to be
                     consistent  with the report  prepared  by the Actuary as at
                     the applicable Valuation Date; and

       (b)    contribute  to the Trust an amount  equal to twice the fee charged
              by the Bank in connection  with the Letter of Credit  extension or
              replacement,   as  applicable.   The  Corporation  shall  withhold
              one-half of such amount and shall remit the said  one-half of such
              amount to the Canada Revenue Agency on account of the tax which is
              exigible   pursuant  to  the  Tax  Act  in  connection  with  such
              contribution  to the Trust.  The Trustee shall remit the remaining
              one-half  of such  amount  to the  Bank in  consideration  for the
              Letter of Credit extension or replacement, as applicable.

       When a replacement  Letter of Credit has been provided in accordance with
       the terms of this  Section  10.3,  an existing  Letter of Credit shall be
       surrendered and cancelled.

10.4   If,  during  the term of a  Letter  of  Credit  issued  pursuant  to this
       Restated Agreement,  the Corporation,  acting reasonably,  concludes that
       there has been a significant  change in the Obligations since the date of
       the last report prepared by the Actuary  pursuant to Section 10.3 of this
       Restated  Agreement,  the  Corporation  shall  request a report  from the
       Actuary as to the then current  value of the  Obligations,  calculated in
       accordance   with  the  provisions  of  Section  10.5  of  this  Restated
       Agreement.  Upon receipt of the report,  the Corporation  shall provide a
       summary of same to the Trustee and  arrange,  together  with the Trustee,
       for any  required  increase  or  decrease  in the amount of the Letter of
       Credit for the balance of the term of such Letter of Credit. In the event
       that a replacement  Letter of Credit is to be issued in the circumstances
       described in this Section  10.4,  the  Corporation  and the Trustee shall
       arrange for such replacement  Letter of Credit to be provided by the Bank
       to the Trustee to replace the Letter of Credit then held by the  Trustee.

<PAGE>
                                     - 18 -


       Upon receipt of a replacement  Letter of Credit  pursuant to this Section
       10.4, the Trustee shall surrender for  cancellation  the Letter of Credit
       then  held  by it  pursuant  to this  Restated  Agreement  and the  Trust
       Agreement.

       In the event that all or any  portion of the fee  referred  to in Section
       10.3 of this Restated Agreement, is refunded by the Bank as a result of a
       decrease  in the amount of a Letter of Credit  pursuant  to this  Section
       10.4, such amount  (together with any resulting  refundable Tax) shall be
       received  by the Trustee  for  deposit to the Trust.  Upon  receipt of an
       Authorized  Instruction (as defined in the Trust Agreement),  the Trustee
       shall pay and transfer  such amounts  (less any  applicable  tax which it
       will remit as  required by the Tax Act on behalf of the  Corporation)  to
       the Corporation for its sole and exclusive use and benefit.

       In the event that an additional fee is required to be paid to the Bank as
       a result of an increase  in the amount of a Letter of Credit  pursuant to
       this Section  10.4,  the  Corporation  shall  contribute  to the Trust an
       amount equal to twice the additional fee. The Corporation  shall withhold
       one-half of such amount and shall remit the said  one-half of such amount
       to the Canada  Revenue  Agency on  account  of the tax which is  exigible
       pursuant  to the Tax Act in  connection  with  such  contribution  to the
       Trust.  The Trustee shall remit the remaining  one-half of such amount to
       the Bank in payment of its additional fee.

10.5   A Letter of Credit issued pursuant to this Restated Agreement shall:

              (i)    be an irrevocable standby letter of credit;

              (ii)   obligate the Bank to satisfy demand for payment made by the
                     Trustee  in  accordance  with the  terms  of this  Restated
                     Agreement and the Trust Agreement;

              (iii)  permit partial drawings; and

              (iv)   provide  that the Bank must notify the Trustee on or before
                     thirty  days  prior to the  expiry of a Letter of Credit of
                     any  notice of  non-extension  provided  by the Bank to the
                     Corporation.

       The  amount of a Letter of Credit  pursuant  to this  Restated  Agreement
       shall be  calculated  by the  Actuary in  accordance  with the  following
       subparagraphs of this Section 10.5.

       (a)    Assuming  the lump sum payments  referred to in Section  7.1(a) of
              this Restated  Agreement are equal to the amount thereof  provided
              by the Corporation.

       (b)    Assuming  the  service  of  the  Executive  will   terminate,   in
              accordance with Section 5.1 or 6.1 of this Restated Agreement,  on
              the next  succeeding  March  31st  after the  Valuation  Date (the
              "Calculation Date").

       (c)    Using the  Executive's  demographic  data,  including base salary,
              target bonus and current  marital status as of the Valuation Date,
              provided by the Corporation.


<PAGE>
                                     - 19 -


       (d)    Using the Yearly Maximum  Pensionable  Earnings (Y.M.P.E.) used to
              determine  the amount of the Canada  Pension  Plan Benefit and Tax
              Act  maximum  defined  benefit  pension  dollar  limit  as at  the
              Valuation Date.

       (e)    Assuming all Obligations are included.

       (f)    Using  the  actuarial   methods,   assumptions   and   calculation
              methodology described in Schedule "B-2.

       (g)    Applying a load of 15% to the amount determined in accordance with
              subparagraphs  (b) through (f) of this Section 10.5 to provide for
              fluctuations in the Interest  Discount Rate,  Consumer Price Index
              and other plan experience during the term of the Letter of Credit,
              as described in Schedule "B-2".

       (h)    Applying a load to one-half of the amount determined in accordance
              with subparagraphs (a) through (g) of this Section 10.5 to provide
              for  the  cost  associated   with  the  borrowings   described  in
              subparagraph  (k) of this Section  10.5,  as described in Schedule
              "B-2".

       (i)    Including  a  settlement  expense  to  the  amount  determined  in
              subparagraph (h), with the aggregate  settlement expense allowance
              for all  obligations  secured  equal to  $250,000,  or  where  the
              Valuation   Date  is  after   December  31,  2008,  the  aggregate
              settlement  expense  allowance will be increased at the rate equal
              to the  increase in the  Consumer  Price  Index,  as  described in
              Schedule "B-2", plus 1% for each year after 2008.

       (j)    Assuming  the  Obligations  will  be  promptly  settled  with  the
              Executive  upon  occurrence  of a  Designated  Event  described in
              Section 1.1(n)(ii).

       (k)    Assuming  a loan  will be  secured  to  permit  settlement  of the
              Obligations  prior to receipt of the  Refundable  Tax Account from
              the Canada Revenue  Agency.  The assumed  interest rate payable on
              the  loan  shall  be as  described  in  Schedule  "B-2".  The cost
              associated  with the  borrowings  shall be assumed to be paid from
              the Trust.

       (l)    The liabilities  calculated in accordance with  subparagraphs  (a)
              through (k) above shall be offset by:

              (i)    the Refundable Tax Account, if any; and

              (ii)   the assets contained in the Trust, if any.

10.6   (a)    If an Executive  Benefit Plan Obligations - Designated Event shall
              occur,  the Corporation  shall be required to immediately fund the
              Executive  Benefit Plan  Obligations  in accordance  with the most
              recent report prepared by the Actuary  pursuant to Section 10.3 of
              this Restated  Agreement.  Notwithstanding  the  foregoing,  if an
              Executive Benefit Plan Obligations - Designated Event described in

<PAGE>
                                     - 20 -


              Section 1.1(x)(i) and a Change of Control Obligations - Designated
              Event described in Section 1.1(n)(ii) shall occur  simultaneously,
              the Corporation  shall be required to settle the Executive Benefit
              Plan  Obligations  forthwith in accordance  with the provisions of
              Schedule "B-1".

       (b)    If:

              (i)    the  employment  of  the  Executive  is  terminated  by the
                     Corporation  for any  reason  other than as a result of the
                     death, disability or retirement of such Executive; and

              (ii)   such Executive files with the Corporation a written request
                     that it fund the Executive Benefit Plan Obligations,

                  the  Corporation  shall be  required to  immediately  fund the
                  Executive Benefit Plan Obligations in accordance with the most
                  recent report prepared by the Actuary pursuant to Section 10.3
                  of this Restated Agreement.

       (c)    Upon the earlier of:

              (i)    learning of the  occurrence  of an  Executive  Benefit Plan
                     Obligations  -  Designated   Event   described  in  Section
                     1.1(x)(v) or (vi) of this Restated Agreement; or

              (ii)   receipt  of a  written  notice  of  the  occurrence  of  an
                     Executive  Benefit  Plan  Obligations  -  Designated  Event
                     described  in any of the  other  subparagraphs  of  Section
                     1.1(x) of this  Restated  Agreement,  which notice has been
                     signed by two  executives of the  Corporation,  one of whom
                     must be either the Chief  Financial  Officer or the General
                     Counsel of the  Corporation  and which notice must,  in the
                     case of an Executive  Benefit Plan Obligations - Designated
                     Event  described  in  Section  1.1(x)(i)  of this  Restated
                     Agreement, indicate which subparagraph of the definition of
                     "Change of Control" is applicable,

              the  Trustee  shall  promptly  give notice to the  Corporation  in
              writing  that it intends to draw on that  portion of the Letter of
              Credit  which  is  referable   to  the   Executive   Benefit  Plan
              Obligations   and  contribute  the  proceeds   thereof  (less  any
              applicable  withholding tax which it will remit as required by the
              Tax Act on  behalf of the  Corporation)  to the Trust on behalf of
              the  Corporation  in  order  to fund the  Executive  Benefit  Plan
              Obligations,  unless it receives  satisfactory  proof  within nine
              days of such notice that the Corporation has funded or settled, as
              applicable,  the  Executive  Benefit  Plan  Obligations  itself in
              accordance with the terms of this Restated Agreement.


<PAGE>
                                     - 21 -


              Unless the Corporation  advises the Trustee in writing that it has
              funded or settled,  as  applicable,  the  Executive  Benefit  Plan
              Obligations  in  accordance   with  the  terms  of  this  Restated
              Agreement  and has provided the Trustee  with  satisfactory  proof
              thereof within nine days of the date of the aforementioned notice,
              the  Trustee  shall  draw on that  portion of the Letter of Credit
              which is referable to the Executive  Benefit Plan  Obligations  on
              the  tenth  day  following  the date of such  notice  (or the next
              following  business  day if such tenth day is not a business  day)
              and   contribute   the  proceeds   thereof  (less  any  applicable
              withholding  tax which it will remit as required by the Tax Act on
              behalf  of  the  Corporation)  to  the  Trust  on  behalf  of  the
              Corporation.

              Notwithstanding  the foregoing,  in the event an Executive Benefit
              Plan Obligations - Designated Event described in Section 1.1(x)(v)
              or (vi) of this Restated  Agreement has triggered the operation of
              this  Section  10.6  and  the  failure  which  gave  rise  to  the
              occurrence of such Executive Benefit Plan Obligations - Designated
              Event has been  remedied  prior to the  expiration  of the  notice
              period provided for in this Section 10.6(c), the Trustee shall not
              take the action described in the immediately  preceding  paragraph
              hereof and all of the provisions of this Restated  Agreement shall
              continue  to apply to the same  extent  and as fully as they would
              have in the event that such Executive  Benefit Plan  Obligations -
              Designated Event had not occurred.

       (d)    Upon receipt of a written  notice of the  occurrence of the events
              described in both subparagraphs (i) and (ii) of Section 10.6(b) of
              this  Restated  Agreement  (which  notice  has been  signed by the
              Executive  and sworn before a notary  public),  the Trustee  shall
              promptly give notice to the Corporation in writing that it intends
              to draw on that portion of the Letter of Credit which is referable
              to the  Executive  Benefit Plan  Obligations  and  contribute  the
              proceeds (less any applicable  withholding tax which it will remit
              as  required by the Tax Act on behalf of the  Corporation)  to the
              Trust on behalf of the  Corporation in order to fund the Executive
              Benefit Plan  Obligations  unless it receives  satisfactory  proof
              within nine days of the date of such  notice that the  Corporation
              has  funded  the  Executive  Benefit  Plan  Obligations  itself in
              accordance with the terms of this Restated Agreement.

              Unless the Corporation  advises the Trustee in writing that it has
              funded the Executive  Benefit Plan  Obligations in accordance with
              the terms hereof and has  provided  the Trustee with  satisfactory
              proof thereof  within nine days of the date of the  aforementioned
              notice,  the Trustee shall draw upon that portion of the Letter of
              Credit  which  is  referable   to  the   Executive   Benefit  Plan
              Obligations on the tenth day following the date of such notice (or
              the  next  following  business  day  if  such  tenth  day is not a
              business day) and  contribute  the proceeds  (less any  applicable
              withholding  tax which it will remit as required by the Tax Act on
              behalf  of  the  Corporation)  to  the  Trust  on  behalf  of  the
              Corporation.

       (e)    For purposes of determining  the required amount of funding or the
              portion  of the  Letter of Credit to be drawn on for  purposes  of
              this  Section  10.6,  the  Trustee  shall refer to the most recent
              report  prepared  by the Actuary  for  purposes  of this  Restated

<PAGE>
                                     - 22 -


              Agreement and, in particular, to the portion of the report dealing
              with the  Executive  Benefit Plan  Obligations.  In preparing  the
              portion  of  its  report   respecting   Executive   Benefit   Plan
              Obligations, the Actuary shall adhere to the following:

              (i)    Assuming that the Executive,  if then in active employment,
                     will remain in active employment with the Corporation as an
                     officer until the Calculation Date and that the Executive's
                     employment  with  the  Corporation  will  terminate  on the
                     Calculation Date.

              (ii)   Using the  Executive's  demographic  data,  including  base
                     salary,  actual  bonus  history,  target  bonus and current
                     marital  status as of the Valuation  Date,  provided by the
                     Corporation.

              (iii)  Using the Canada  Pension  Plan Benefit and Tax Act maximum
                     defined  benefit  pension  dollar limit as at the Valuation
                     Date.

              (iv)   Assuming the Executive's target bonus percentage remains at
                     the  level  specified  by  the   Corporation   pursuant  to
                     subparagraph (ii) above.

              (v)    Assuming  only  Executive   Benefit  Plan  Obligations  are
                     included.

              (vi)   Assuming  the  payments  under the  Executive  Benefit Plan
                     would be made from the Trust.

              (vii)  Using the actuarial  methods,  assumptions  and calculation
                     methodology described in Schedule "B-2.

              (viii) Applying loads as described in Schedule "B-2" to the amount
                     determined in accordance  with the preceding  subparagraphs
                     of this Section 10.6(e) to provide for future contingencies
                     and expenses of the Trust.

              (ix)   Calculating  the  estimated  amount  required to settle the
                     Executive  Benefit Plan Obligations  based on the actuarial
                     methods,  assumptions and calculation methodology described
                     in Schedule "B-2",  increased by the loads described in the
                     following subparagraph.

              (x)    Applying loads as described in Schedule "B-2" to the amount
                     determined in accordance with  subparagraph (ix) to provide
                     for:

                     (A)    fluctuations  in  the  Interest  Discount  Rate  and
                            Consumer  Price Index  during the term of the Letter
                            of Credit; and

                     (B)    the cost  associated  with the loan to be secured as
                            allowed   under  the  Trust   Agreement   to  permit
                            settlement of the Executive Benefit Plan Obligations
                            prior to receipt of the  Refundable Tax Account from
                            the Canada Revenue Agency. The assumed interest rate

<PAGE>
                                     - 23 -


                            payable  on  the  loan  shall  be  as  described  in
                            Schedule  "B-2" and shall be applied to  one-half of
                            the amount in subparagraph (ix). The cost associated
                            with the borrowings shall be assumed to be paid from
                            the Trust.

              (xi)   Taking the larger amount for the Executive of:

                     (A)    the   amount    determined   in   accordance    with
                            subparagraphs (i) through (viii), and

                     (B)    the   amount    determined   in   accordance    with
                            subparagraphs (ix) and (x).

              (xii)  The amount  determined in accordance with subparagraph (xi)
                     above shall be offset by:

                     (A)    the Refundable Tax Account, if any;

                     (B)    the assets contained in the Trust, if any.

       (f)    In the event that the Executive Benefit Plan Obligations have been
              funded in accordance with the terms hereof as a result of:

              (i)    the  Corporation  making an  assignment  for the benefit of
                     creditors  or filing a petition in  bankruptcy  or becoming
                     insolvent or bankrupt;

              (ii)   a receiver, trustee or liquidator of or for the Corporation
                     being appointed and not being discharged within a period of
                     sixty days;

              (iii)  a voluntary dissolution or wind-up of the Corporation; or

              (iv)   a sale or  disposition of all or  substantially  all of the
                     assets of the Corporation,

              and the Executive  Benefit Plan has been  terminated in connection
              therewith,   the  Executive  Benefit  Plan  Obligations  shall  be
              promptly  settled by the Trustee  with the  Executive  by way of a
              lump sum payment  from the Trust.  For this  purpose,  the benefit
              entitlements  of each Executive shall be determined by the Actuary
              in accordance with the terms of the Executive Benefit Plan and the
              amount of the lump sum payment  shall be determined by the Actuary
              using the  assumptions  set  forth in  Schedule  "B-1".  Notice of
              termination of the Executive Benefit Plan shall be provided to the
              Trustee by the Corporation, failing which by two executives of the
              Corporation,  one of  whom  must be  either  the  Chief  Financial
              Officer or the General Counsel of the Corporation.


<PAGE>
                                     - 24 -


              Any assets of the Trust remaining  after full  satisfaction of (i)
              the Executive  Benefit Plan Obligations  pursuant to the preceding
              paragraph and (ii) any further  obligations  pursuant to the terms
              of the Trust Agreement, shall be returned to the Corporation.

       (g)    In the event the Executive Benefit Plan shall be terminated at any
              time  either  in whole  or in part in  relation  to the  Executive
              subsequent   to  the  funding  of  the   Executive   Benefit  Plan
              Obligations in accordance  with the terms hereof,  then,  provided
              Section  10.6(f)  of  this  Restated  Agreement  is not  otherwise
              applicable,  the  Executive  Benefit  Plan  Obligations  shall  be
              promptly  settled by the Trustee  with the  Executive  by way of a
              lump sum payment from the Trust.

              For this purpose,  the benefit entitlements of the Executive shall
              be determined  by the Actuary in accordance  with the terms of the
              Executive  Benefit  Plan and the  amount  of the lump sum  payment
              shall be determined by the Actuary using the assumptions set forth
              in Schedule  "B-1".  Notice of the  termination  of the  Executive
              Benefit Plan shall be provided to the Trustee by the  Corporation,
              failing which by two  executives of the  Corporation,  one of whom
              must be either the Chief Financial  Officer or the General Counsel
              of the Corporation.

              Any assets of the Trust remaining  after full  satisfaction of (i)
              the  Executive  Benefit  Plan  Obligations  and (ii)  any  further
              obligations pursuant to the terms of the Trust Agreement, shall be
              returned to the Corporation.

       (h)    In the event:

              (i)    of a dispute  as to  whether a payment  to or in respect of
                     the  Executive is properly due and payable  pursuant to the
                     Executive Benefit Plan; and

              (ii)   such  dispute  cannot be resolved  by the  parties  thereto
                     within the time frame  specified in Section  1.1(x)(vi)  of
                     this Restated Agreement,

              the amount in dispute shall be remitted to the Trustee for deposit
              to the Trust. Upon final settlement of the dispute,  the amount so
              deposited  (together  with any  earnings,  profits and  increments
              thereon and after deduction of any authorized  payments  allocable
              thereto,  both as determined  in accordance  with the terms of the
              Trust Agreement),  less any applicable  withholding tax which will
              be  remitted  as  required  by the Tax Act,  shall be paid to that
              party to the dispute which is found to be entitled thereto.  Prior
              to such amount being paid out of the Trust in accordance  with the
              terms hereof,  the Corporation  shall instruct the Actuary to take
              such amount into account when preparing its report for purposes of
              this Restated Agreement.

       (i)    In the event that a Change of  Control  Obligations  -  Designated
              Event described in Section  1.1(n)(ii) of this Restated  Agreement
              shall occur  subsequent  to the funding of the  Executive  Benefit
              Plan  Obligations  in  accordance  with the terms of this Restated
              Agreement,  the  Corporation  shall  be  required  to  settle  the

<PAGE>
                                     - 25 -


              Executive   Benefit  Plan  Obligations   forthwith  in  an  amount
              determined  by the Actuary in  accordance  with the  provisions of
              Schedule "B-1".

       (j)    Subject to Section  10.6(f),  10.6(g) and 10.6(i) of this Restated
              Agreement,   in  the  event  that  the   Executive   Benefit  Plan
              Obligations  have been funded in accordance with the terms hereof,
              all or a portion of such Executive  Benefit Plan  Obligations may,
              at the discretion of the Corporation, be promptly settled with the
              Executive.

              For this purpose,  the benefit entitlements of the Executive shall
              be determined  by the Actuary in accordance  with the terms of the
              Executive  Benefit Plan. In such  circumstances,  the  Corporation
              reserves   the  right  to  settle  the   Executive   Benefit  Plan
              Obligations by way of a lump sum payment to the Executive provided
              that the amount of each such payment is  determined by the Actuary
              in accordance with the assumptions set forth in Schedule "B-1".

10.7   (a)    If a Change of Control Obligations - Designated Event described in
              Section  1.1(n)(i) of this  Restated  Agreement  shall occur,  the
              Corporation  shall be required to  immediately  fund the Change of
              Control  Obligations  in  accordance  with the most recent  report
              prepared by the Actuary  pursuant to Section 10.3 of this Restated
              Agreement.

       (b)    If a Change of Control Obligations - Designated Event described in
              Section  1.1(n)(ii) of this Restated  Agreement  shall occur,  the
              Corporation  shall be  required  to settle  the  Change of Control
              Obligations   forthwith  in  accordance  with  the  provisions  of
              Schedule  "B-1",  upon  receipt  by the  Corporation  of a Release
              executed by the  Executive in the form  attached to this  Restated
              Agreement as Schedule "A".

       (c)    Upon the earlier of:

              (i)    learning  of  the   occurrence   of  a  Change  of  Control
                     Obligations  -  Designated   Event   described  in  Section
                     1.1(n)(i) of this Restated Agreement; or

              (ii)   receipt of a written  notice of the  occurrence of a Change
                     of Control  Obligations  -  Designated  Event  described in
                     Section 1.1(n)(ii) of this Restated Agreement, which notice
                     has been signed by the  Executive and sworn before a notary
                     public and has  annexed  thereto a Release  executed by the
                     Executive in the form attached to this  Restated  Agreement
                     as Schedule "A",

              the  Trustee  shall  promptly  give notice to the  Corporation  in
              writing  that it intends to draw on that  portion of the Letter of
              Credit which is referable to the Change of Control Obligations and
              contribute the proceeds  thereof (less any applicable  withholding
              tax which it will  remit as  required  by the Tax Act on behalf of
              the  Corporation)  to the Trust on behalf  of the  Corporation  in

<PAGE>
                                     - 26 -


              order  to fund  the  Change  of  Control  Obligations,  unless  it
              receives  satisfactory  proof within nine days of such notice that
              the Corporation has funded or settled,  as applicable,  the Change
              of Control Obligations itself in accordance with the terms of this
              Restated Agreement.

              Unless the Corporation  advises the Trustee in writing that it has
              funded  or  settled,   as   applicable,   the  Change  of  Control
              Obligations  in  accordance   with  the  terms  of  this  Restated
              Agreement  and has provided the Trustee  with  satisfactory  proof
              thereof within nine days of the date of the aforementioned notice,
              the  Trustee  shall  draw on that  portion of the Letter of Credit
              which is  referable  to the Change of Control  Obligations  on the
              tenth day following the date of such notice (or the next following
              business  day  if  such  tenth  day  is not a  business  day)  and
              contribute the proceeds (less any applicable withholding tax which
              it  will  remit  as  required  by the  Tax  Act on  behalf  of the
              Corporation) to the Trust on behalf of the Corporation.

              Notwithstanding  the  foregoing,  in the event a Change of Control
              Obligations - Designated  Event described in Section  1.1(n)(i) of
              this  Restated  Agreement  has  triggered  the  operation  of this
              Section 10.7 and the failure which gave rise to the  occurrence of
              such Change of Control  Obligations  -  Designated  Event has been
              remedied prior to the expiration of the notice period provided for
              in this  Section  10.7(c),  the Trustee  shall not take the action
              described in the immediately preceding paragraph hereof and all of
              the provisions of this Restated  Agreement shall continue to apply
              to the same  extent  and as fully as they  would have in the event
              that such Change of Control Obligations - Designated Event had not
              occurred.

       (d)    The  required  amount of funding  or the  portion of the Letter of
              Credit to be drawn on for  purposes of this  Section 10.7 shall be
              determined  by the Actuary and shall be the amount  determined  in
              accordance  with  Sections  10.5(a)  through (l) of this  Restated
              Agreement  offset by the  amount  determined  in  accordance  with
              subparagraphs 10.6(e)(i) through (xii) of this Restated Agreement.
              The  settlement  amount for purposes of this Section 10.7 shall be
              determined in accordance with the provisions of Schedule "B-1".

       (e)    In the event  that the  Change of  Control  Obligations  have been
              funded  in  accordance  with the  terms  hereof as a result of the
              occurrence of a Change of Control  Obligations - Designated  Event
              described in Section 1.1(n)(ii), the Change of Control Obligations
              shall be promptly  settled with the Executive in  accordance  with
              the provisions of Schedule "B-1".

10.8   The actuarial  methods and  assumptions  described in Schedule  "B-1" and
       Schedule  "B-2" shall be reviewed  from time to time.  Any  amendments to
       Schedule "B-1" and/or  Schedule "B-2" as a result of such review shall be
       dealt with in accordance with Section 12.6.


<PAGE>
                                     - 27 -


10.9   The Trustee shall  surrender the Letter of Credit to the  Corporation for
       cancellation upon the earliest of:

       (a)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation and the Executive directing surrender of the Letter of
              Credit;

       (b)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation  confirming  that it has  funded  and/or  settled  the
              Obligations  in accordance  with the terms  hereof,  together with
              evidence  which is  satisfactory  to the Trustee that such funding
              and/or settlement has occurred; and

       (c)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation  confirming  that  the  Corporation  has no  remaining
              Obligations  to the  Executive,  together with  evidence  which is
              satisfactory  to the Trustee that the Corporation has no remaining
              Obligations  to the  Executive  and  that a copy of  such  written
              direction has been provided to the Executive.

10.10  The Trust shall be terminated by the Trustee upon the earliest of:

       (a)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation  and the Executive  confirming the  termination of the
              Trust;

       (b)    the entire depletion of the Trust Fund through  payments  pursuant
              to the  terms of the  Trust  Agreement,  in the  event  that  such
              depletion  occurs  subsequent to the funding of the Obligations in
              accordance with the terms of this Restated Agreement; and

       (c)    receipt  by the  Trustee  of a  written  direction  signed  by the
              Corporation  confirming  that  the  Corporation  has no  remaining
              Obligations  to the  Executive,  together with  evidence  which is
              satisfactory to the Trustee that a copy of such written  direction
              has been provided to the Executive.

       Upon the  termination of the Trust,  any assets of the Trust which remain
       after the satisfaction of any remaining Obligations of the Corporation to
       the Executive shall be returned to the Corporation.

10.11  The Corporation and the Executive hereby acknowledge that the Corporation
       is entering  into  agreements  similar to this  Restated  Agreement  with
       certain of its other executives and that the Corporation may, at its sole
       discretion,  arrange  for one or more  Letters of Credit to  satisfy  its
       responsibilities under this Restated Agreement and such other agreements.
       In the  event  that one  Letter  of Credit is  obtained  to  satisfy  the
       Corporation's  responsibilities under this Restated Agreement and some or
       all of such other agreements,  references to a "Letter of Credit" in this
       Restated  Agreement  shall be read as  references to that portion of such
       Letter  of  Credit  which is  referable  to the  responsibilities  of the
       Corporation to the Executive.


<PAGE>
                                     - 28 -


       The Corporation and the Executive also  acknowledge  that the Corporation
       may, at its sole  discretion,  enter into one or more Trust Agreements to
       satisfy its responsibilities under this Restated Agreement and such other
       agreements.  In the event that one Trust  Agreement  is  entered  into to
       satisfy the Corporation's  responsibilities under this Restated Agreement
       and some or all of such other agreements,  references to "Trust",  "Trust
       Agreement",  "Trustee"  and  "Refundable  Tax  Account" in this  Restated
       Agreement  shall be read with such  modifications  as may be necessary in
       the context.

10.12  At the  discretion of the  Corporation  and subject to the  provisions of
       applicable law, in the event that all or a portion of the Obligations are
       funded in  accordance  with  Article 10 hereof and an  actuarial  surplus
       (determined  by actuarial  valuation in accordance  with the terms of the
       report  prepared  as at  the  immediately  preceding  Valuation  Date  in
       accordance  with Section  10.3 of this  Restated  Agreement)  arises as a
       result thereof:

       (a)    all or a  portion  of such  actuarial  surplus  may be used in the
              determination of or to reduce the funding otherwise required to be
              provided by the Corporation hereunder; or


       (b)    any surplus assets may, to the extent that they exceed 110% of the
              amount required to fund that portion of the Obligations  which has
              been  funded  (as  determined  by the  report  prepared  as at the
              immediately  preceding  Valuation Date in accordance  with Section
              10.3 of this Restated Agreement) be returned to the Corporation.


                                   ARTICLE 11
                              EXPEDITED ARBITRATION
                              ---------------------

11.1   If,  pursuant to Section 6.1 of this  Restated  Agreement,  the Executive
       provides  written  notice of the  Executive's  intention to terminate the
       Executive's employment for Good Reason, and the Corporation believes that
       there is no Good Reason, or,  alternatively,  if, pursuant to Section 4.1
       of this Restated  Agreement,  the Corporation  provides written notice of
       its intention to terminate the Executive's  employment for Just Cause and
       the Executive  believes  there is no Just Cause,  the  Corporation or the
       Executive,  as  applicable,  shall,  within ten (10) days of having  been
       provided such notice, provide written notice ("Notice of Dispute") to the
       other Party of the dispute (the "Dispute").

11.2   The Parties  agree that any and all Disputes  under  Section 11.1 of this
       Restated Agreement will be resolved by way of a single Arbitrator.

11.3   (a)    Within  fifteen  (15) days of  provision of the Notice of Dispute,
              the Parties shall agree upon and appoint a neutral Arbitrator from
              the then current  roster  maintained by the Alberta  Mediation and
              Arbitration Society to act as Arbitrator of the Dispute; or


<PAGE>
                                     - 29 -


       (b)    If no person  acceptable  to both Parties has been agreed upon and
              appointed  within  fifteen  (15) days,  then either Party may make
              immediate  application  to the Court of Queen's  Bench of Alberta,
              Judicial District of Calgary, to have an Arbitrator appointed.

11.4   The Parties  acknowledge and agree that the purpose of this Article 11 is
       to avoid  delays  and  facilitate  resolution  of the  Dispute in a just,
       speedy and cost-effective manner.

11.5   Consistent with the expedited nature of arbitration,  the Arbitrator will
       direct and  control the scope and timing of the  exchange of  information
       between  the  Parties  and will take such steps as the  Arbitrator  deems
       necessary to achieve a just, speedy and cost-effective  resolution of the
       Dispute.  The Arbitrator has the exclusive right and power to resolve all
       issues related to the exchange of information in the arbitration process.

11.6   The Parties  agree that the  Arbitrator  is only  authorized to determine
       whether the Executive  had Good Reason for  terminating  the  Executive's
       employment,  or alternatively,  whether the Corporation had Just Cause to
       terminate the Executive's employment.

11.7   A hearing will occur within  forty-five  (45) days of the  appointment of
       the  Arbitrator  (the  "Hearing").  The time of the Hearing (the "Hearing
       Date") will be scheduled by the Arbitrator  after  consultation  with the
       Parties.  The  Hearing  will  be  governed  by the  rules  set out in the
       Arbitration Act S.A. 1991,  c.A-43,  as modified by the Arbitrator in the
       interests of achieving a just,  speedy and  cost-effective  resolution of
       the Dispute.  The Arbitrator may require  written  submissions of fact in
       the Dispute to be provided seven (7) days before the Hearing Date.

11.8   The Arbitrator will use best efforts to provide a written decision within
       seven (7) days of the conclusion of the Hearing.

11.9   The Parties agree that the decision of the  Arbitrator  will be final and
       binding upon the Parties.


                                    ARTICLE 12
                                     GENERAL
                                     -------

12.1   The headings of the Articles and  paragraphs in this  Restated  Agreement
       are  inserted  for  convenience  only and shall not affect the meaning or
       construction of this Restated Agreement.

12.2   This Restated  Agreement shall be construed and interpreted in accordance
       with the laws of the  Province of Alberta and the federal  laws of Canada
       as applicable therein.

12.3   If any provision of this  Restated  Agreement is determined to be void or
       unenforceable  in  whole or in part,  it  shall  be and be  deemed  to be
       severed from this Restated  Agreement  without affecting or impairing the
       validity of any other provision herein.

<PAGE>
                                     - 30 -


12.4   Any  notice  required  or  permitted  to be  given  under  this  Restated
       Agreement shall be in writing and shall be properly given if delivered by
       hand delivery or mail or other form of electronic  communication  capable
       of transmission confirmation to the following address:

       a.     IN THE CASE OF THE CORPORATION TO:
              ----------------------------------

              Nexen Inc.
              801 - 7th Avenue S.W.
              Calgary, AB  T2P 3P7
              Attention:  General Manager, Compensation and Benefits

       b.     IN THE CASE OF THE EXECUTIVE TO:
              --------------------------------

              the  last  address  of  the   Executive  in  the  records  of  the
              Corporation  or to such other address as the Parties may from time
              to time specify by notice given in accordance herewith.

12.5   This Restated Agreement shall enure to the benefit of and be binding upon
       the Executive and the Executive's heirs, executors and administrators and
       upon the Corporation and its successors and assigns.

12.6   This Restated Agreement  constitutes the entire agreement relating to the
       respective rights and obligations of the Parties upon the occurrence of a
       Change of Control.  No  amendment  or waiver of this  Restated  Agreement
       shall be binding unless executed in writing by the Parties.

       Notwithstanding the foregoing,

       (a)    any amendment to Article 10 of this Restated  Agreement,  Schedule
              "B-1" or  Schedule  "B-2"  which is  required  to ensure  that the
              balance  remaining  in the Trust after the  required  tax has been
              withheld and remitted to the Canada  Revenue  Agency is sufficient
              to  satisfy  the fee  levied  by the Bank in  connection  with the
              issuance  of a Letter  of  Credit  may be made by the  Corporation
              without the prior written approval of the Executive; and

       (b)    the  Corporation  may  amend,  modify or waive  Article 10 of this
              Restated Agreement,  Schedule "B-1" and Schedule "B-2" in whole or
              in part,  at such time and from time to time,  and in such  manner
              and to such extent as it may deem advisable  without obtaining the
              approval  of  the   Executive,   provided  that  such   amendment,
              modification  or waiver,  as the case may be,  does not  adversely
              affect the  securitization  in accordance with the terms hereof of
              those  Obligations  which  have  accrued  up to the  date  of such
              amendment, modification or waiver, as the case may be.


<PAGE>
                                     - 31 -


12.7   The Parties agree that the rights,  entitlements  and benefits set out in
       this  Restated  Agreement  to be paid to the  Executive  upon a Change of
       Control  shall be in full  satisfaction  of all  rights of the  Executive
       under applicable law in effect from time to time as a result thereof.

12.8   Neither  Party can waive or shall be deemed to have  waived  any right it
       has under this Restated  Agreement  except to the extent that such waiver
       is in writing.

12.9   Nothing  contained  in this  Restated  Agreement  shall be  construed  as
       limiting the ability of the Corporation to amend, modify or terminate the
       Executive Benefit Plan in whole or in part, at such time and from time to
       time, and in such manner and to such extent as it may deem advisable.


The Parties have  executed  this  Restated  Agreement  effective  the date first
written above.


                                                NEXEN INC.


                                                Per: (signed)
                                                     ---------------------------


                                                Per: (signed)
                                                     ---------------------------



SIGNED, SEALED & DELIVERED
in the presence of

(signed)                                        (signed)
-------------------------------                 --------------------------------
WITNESS                                         ROGER THOMAS


<PAGE>


                                  SCHEDULE "A"
                                  ------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS

In order to  receive  the  entitlements  referred  to in the  Article  7 of this
Restated  Agreement,  the Executive  shall execute the attached  Release,  fully
releasing the Corporation from all further claims in relation to the Executive's
employment or Employment  Benefits and the  termination  thereof upon payment of
the  remuneration  and  benefits  referred  to in  Article  7 of  this  Restated
Agreement.  The attached Release shall not, however,  require that the Executive
relinquish  or release any rights to indemnity  which the  Executive  may, as an
officer or director of the Corporation or any of its Affiliates,  Associates and
Subsidiaries,  have  as  against  the  Corporation  or any  of  its  Affiliates,
Associates and Subsidiaries, for costs, charges and expenses reasonably incurred
by the Executive in respect of any civil,  criminal or administrative  action or
proceeding  to which the  Executive is made a party by reason of being or having
been a  director  or  officer  of  the  Corporation  or  any of its  Affiliates,
Associates and Subsidiaries, where:


       (a)    the Executive has acted  honestly and in good faith with a view to
              the best interests of the  Corporation  or any of its  Affiliates,
              Associates and Subsidiaries; and


       (b)    in the case of a criminal or  administrative  action or proceeding
              enforced  by a monetary  penalty,  the  Executive  had  reasonable
              grounds for believing the Executive's conduct was lawful.


<PAGE>


                                  FINAL RELEASE
                                  -------------


KNOW ALL MEN BY THESE PRESENTS that I, ROGER THOMAS, of the City of Calgary,  in
the  Province  of Alberta,  in  consideration  of the  amounts  provided in that
certain  Amended  and  Restated  Agreement  Respecting  Change  of  Control  and
Executive Benefit Plan  Entitlements (the "Restated  Agreement") dated as of the
______ day of  ____________,  2008  between  myself and NEXEN INC. and for other
good and valuable consideration,  the receipt and sufficiency of which is hereby
acknowledged, do for myself, my executors and assigns hereby remise, release and
forever discharge the Corporation, and any associated,  affiliated,  predecessor
or parent corporation of the Corporation and their present and former directors,
officers,  agents  and  employees  (the  "Releasees"),  including  each of their
respective  successors,  heirs,  administrators and assigns,  from all manner of
actions,  causes of action, debts,  obligations,  covenants,  claims or demands,
whatsoever  which I may ever have had, now have, or can,  shall or may hereafter
have against the  Releasees  or any of them,  by reason of or arising out of any
cause,  matter  or  thing  whatsoever  done,  occurring  or  existing  up to and
including the present date and, in  particular,  without in any way  restricting
the  generality  of the  foregoing,  in  respect  of all  claims  of any  nature
whatsoever,  past,  present  or future,  directly  or  indirectly  related to or
arising out of or in connection with my relationship  with the Releasees,  as an
employee,  officer or director,  and the  termination of my employment  from the
Corporation including, but not limited to, any claims related to any entitlement
I may have or may have had to any payment or claim either at common law or under
the Employment  Standards Code, Human Rights,  Citizenship and  Multiculturalism
Act or any other  applicable  legislation  governing or related to my employment
with the Releasees.


AND FOR THE SAID  CONSIDERATION,  I, ROGER THOMAS,  represent and warrant that I
have not assigned to any person, firm or corporation any of the actions,  causes
of action, claims, suits, executions or demands which I release by this Release,
or with  respect  to which I agree not to make any claim or take any  proceeding
herein.


IT IS FURTHER ACKNOWLEDGED that the payment to me includes full compensation and
consideration  for the  loss  of my  employment  benefits,  as  provided  by the
Releasees,  and that all of my employment benefits and privileges shall cease on
the date of termination of my employment, except as otherwise expressly provided
in the  Restated  Agreement.  I further  acknowledge  that I have  received  all
benefits  due to me and have no further  claim  against the  Releasees  for such

<PAGE>


benefits.  I further accept sole responsibility to replace such benefits which I
wish to continue or to exercise  conversion  privileges  where  applicable  with
respect to such  benefits and, in  particular  any life  insurance and long-term
disability benefits.  In the event that I become disabled following  termination
of my  employment,  I covenant not to sue the  Releasees  for insurance or other
benefits  or loss of same and  hereby  release  the  Releasees  from any and all
further obligations or liabilities arising therefrom.


Notwithstanding  anything contained herein,  this Release shall not extend to or
affect,  or  constitute a release of, my right to sue,  claim against or recover
from the  Releasees  and shall not  constitute  an  agreement  to  refrain  from
bringing, taking or maintaining any action against the Releasees in respect of:


       (a)    any corporate indemnity existing by statute,  contract or pursuant
              to any of the constating  documents of the Corporation provided in
              my favour in respect of my having acted at any time as a director,
              officer or both of the Corporation;


       (b)    my  entitlement  to any  insurance  maintained  for the benefit or
              protection of the directors  and/or  officers of the  Corporation,
              including without  limitation,  directors' and officers' liability
              insurance; or


       (c)    my entitlement to any amounts or compensation  due to me under the
              terms of my employment pursuant to the Restated Agreement.


IT IS HEREBY AGREED that the terms of the Restated Agreement and of this Release
will be kept  confidential.  No party hereto shall communicate any such terms to
any third party under any  circumstances  whatsoever,  excepting  any  necessary
communication with my legal and financial advisors,  as required, on the express
condition  that they maintain the  confidentiality  thereof,  and any disclosure
which is required by law,  although either party shall be at liberty to disclose
to third  parties  that a  mutually  acceptable  Release  was agreed  upon.  The
invalidity  and  unenforceability  of any  provision of this  Release  shall not
affect the validity or  enforceability  of any other  provision of this Release,
which shall remain in full force and effect.


<PAGE>


I HEREBY  DECLARE that I have read all of this  Release,  fully  understand  the
terms of this Release and voluntarily accept the consideration  stated herein as
the sole  consideration  for this  Release  for the purpose of making a full and
final  settlement with the Releasees.  I further  acknowledge and confirm that I
have been given an adequate period of time to obtain  independent  legal counsel
regarding the meaning and the significance of the terms herein and the covenants
mutually exchanged.

IT IS HEREBY AGREED THAT as a term of the  termination of my employment from the
Corporation,  and in consideration of the amount noted above, I hereby resign as
officer and director of the Corporation and its affiliates.

IN  WITNESS  WHEREOF,  I have  hereunto  set my hand and seal this  _____ day of
______________ in the year _________.




---------------------------------
ROGER THOMAS



---------------------------------
WITNESS (signature)



---------------------------------
WITNESS (print name)

<PAGE>

                                 SCHEDULE "B-1"
                                 --------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS
          METHODOLOGY AND ASSUMPTIONS FOR DETERMINING SETTLEMENT VALUE


PURPOSE

In  accordance  with the terms of the  Restated  Agreement,  the purpose of this
Schedule "B-1" is to outline the calculation  approach such that,  after tax has
been paid on a lump sum settlement  value, the remaining  balance is intended to
be sufficient to provide after-tax monthly payments  equivalent to the after-tax
monthly  payments  the  Executive  would  have  received  under the terms of the
Executive Benefit Plan as provided for under this Restated Agreement.


OVERVIEW FOR DEFINED BENEFIT PENSION

The  following  outlines the  actuarial  methods,  assumptions  and  calculation
process to be used in determining  the lump sum settlement  value of the defined
benefit pension  entitlements  under the Executive  Benefit Plan when settlement
occurs in accordance with Section 10 of the Restated  Agreement.  Section 300 of
the Income Tax  Regulations  establishes  the  procedure  applicable in using an
after-tax lump sum to purchase a prescribed annuity:

1.     A prescribed  annuity payment consists of two components:  (a) the deemed
       capital  element of the annuity  payment on which no tax is payable,  and
       (b) the deemed non-capital  portion of the annuity payment which is taxed
       at the marginal rate.

2.     The capital  portion of each future annuity payment is considered to be a
       return of the original after-tax lump sum amount.

3.     The non-capital portion of each annuity payment is assumed to be provided
       by the  investment  return on the original  after-tax lump sum amount and
       has therefore not yet been taxed.

4.     A constant  percentage of each future payment is deemed to be a return of
       the original lump sum capital.

CALCULATION METHODOLOGY

1.     Equivalent after-tax payments:

a.     Determine  initial gross annual pension  entitlement  under the Executive
       Benefit Plan.

b.     Determine  after-tax  annual  pension  entitlement  under  the  Executive
       Benefit Plan based on Individual Tax Rate as defined in Schedule "B-1".


<PAGE>
                                     - 2 -


c.     Determine the capital element based on the  non-indexed  present value of
       the pension payments divided by life expectancy.

d.     Determine the monthly  payment which provides an after-tax  pension equal
       to the after-tax pension  determined in 1.b. above in accordance with the
       prescribed annuity methodology.

2.     Present value of periodic payments from 1. above:

a.     Determine the present value of the pension determined in 1.d. above using
       the  assumptions  described  below in this  Schedule  "B-1".  For greater
       certainty, the value of the post-retirement indexation is to be reflected
       in determining  the present value of the accrued  pension  entitlement in
       respect  of  post-1992  service,  and any  accrued  pension in respect of
       service granted during the Severance Period.

3.     Tax adjustment:

a.     Gross-up the present value  determined  in 2.a.  above to reflect the tax
       assumed to be required to be paid on the lump sum.

b.     Gross-up the amount  determined in 3.a.  above to reflect the tax assumed
       to be required to be paid on  investment  earnings in respect of the lump
       sum  payment  during  the  deferral   period  prior  to  assumed  pension
       commencement, if any.

4.     Equivalent present value after tax as the after-tax monthly payments:

a.     The amount  determined  in 3.b.  above  shall be the lump sum  settlement
       value of the Executive's pension entitlement.

ASSUMPTIONS

Interest Discount Rate:

--  during deferral period               Yield on long-term Government of Canada
                                         bonds  as  published  in  the  Bank  of
                                         Canada  Review,   described  in  CANSIM
                                         series V122544 (or a successor  series)
                                         for the last  trading  Wednesday at the
                                         end of the month immediately  preceding
                                         the date of  calculation,  rounded down
                                         to next lower 0.5.

--  after assumed pension commencement   Yield on long-term Government of Canada
                                         bonds  as  published  in  the  Bank  of
                                         Canada  Review,   described  in  CANSIM
                                         series V122544 (or a successor  series)
                                         for the last  trading  Wednesday at the
                                         end of the month immediately  preceding
                                         the date of  calculation,  rounded down
                                         to next lower 0.5,

                                         less


<PAGE>
                                     - 3 -


                                         assumed  escalation  of pensions  after
                                         retirement.

Increase in Consumer Price Index:        Yield on long-term Government of Canada
                                         bonds  as  published  in  the  Bank  of
                                         Canada  Review,   described  in  CANSIM
                                         series V122544 (or a successor  series)
                                         for the last  trading  Wednesday at the
                                         end of the month immediately  preceding
                                         the date of calculation,

                                         less

                                         Yield on long-term Government of Canada
                                         Real Return  bonds as  published in the
                                         Bank of  Canada  Review,  described  in
                                         CANSIM  series  V122553 (or a successor
                                         series) for the last trading  Wednesday
                                         at the  end of  the  month  immediately
                                         preceding the date of calculation.

                                         The  result of the  difference  is then
                                         rounded up to the next highest 0.5% .

Escalation of Pensions After             75% of CPI,  less 1% (minimum  increase
Retirement:                              25% of CPI).  Applies  only to benefits
                                         accrued for service after  December 31,
                                         1992.

Mortality:

--  for life expectancy                  1994  Uninsured   Pensioner   Mortality
                                         Table   with   mortality   improvements
                                         projected  to 15 years  beyond the date
                                         of termination.

--  for present values

      o  prior to assumed pension        Nil.
         commencement

      o  after assumed pension           1994  Uninsured   Pensioner   Mortality
         commencement                    Table   with   mortality   improvements
                                         projected  15 years  beyond the date of
                                         termination.

Marital Status:                          Actual status at date of termination.

Age of Spouse:                           Based on actual date of birth.

Individual Tax Rate:                     Maximum  individual  marginal  tax rate
                                         for  employee's  province of employment
                                         at the date of termination.

<PAGE>


                                 SCHEDULE "B-2"
                                 --------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                       EXECUTIVE BENEFIT PLAN ENTITLEMENTS

METHODOLOGY  AND  ASSUMPTIONS FOR DETERMINING THE AMOUNT TO BE SECURED OR FUNDED
IN  ACCORDANCE  WITH SECTION 10 BASED ON THE  METHODOLOGY  DESCRIBED IN SCHEDULE
"B-1"


PURPOSE

The purpose of this Schedule "B-2" is to provide the actuarial  methodology  and
assumptions  for  determining  the amount to be secured or funded in  accordance
with Section 10 of the Restated Agreement.

METHODOLOGY

The settlement methodology is described in Schedule B-1.

The funding methodology  applicable to the Executive Benefit Plan Obligations is
based on the following:

1.     Estimate the accrued pension  payable from the Executive  Benefit Plan as
       at the Valuation Date.

2.     Assume  that  the  assets  of the plan are to be  invested  in long  term
       Government  of  Canada  bonds  and  subject  to the  50%  refundable  tax
       applicable to retirement compensation arrangements.

3.     Determine the present value of the amounts in 1 through 2 above.

4.     Estimate the settlement  value that could be paid in accordance  with the
       methodology and assumptions described in Schedule B-1.

5.     The funding amount in respect of the Executive  Benefit Plan  Obligations
       shall be the  greater  of the  amount  determined  in  accordance  with 1
       through 3 above and the amount in 4 above.

ASSUMPTIONS

Interest Discount Rate:

--  during deferral period               Yield on long-term Government of Canada
                                         bonds  as  published  in  the  Bank  of
                                         Canada  Review,   described  in  CANSIM
                                         series V122544 (or a successor  series)
                                         for the last  trading  Wednesday at the
                                         end of the month immediately  preceding
                                         the Anniversary  Date,  rounded down to
                                         next lower 0.5.


<PAGE>
                                     - 2 -


--  after assumed pension commencement   Yield on long-term Government of Canada
                                         bonds  as  published  in  the  Bank  of
                                         Canada  Review,   described  in  CANSIM
                                         series V122544 (or a successor  series)
                                         for the last  trading  Wednesday at the
                                         end of the month immediately  preceding
                                         the Anniversary  Date,  rounded down to
                                         next   lower   0.5   ,   less   assumed
                                         escalation     of    pensions     after
                                         retirement.

Increase in Consumer Price Index:        Yield on long-term Government of Canada
                                         bonds  as  published  in  the  Bank  of
                                         Canada  Review,   described  in  CANSIM
                                         series V122544 (or a successor  series)
                                         for the last  trading  Wednesday at the
                                         end of the month immediately  preceding
                                         the Anniversary Date,

                                         less

                                         Yield on long-term Government of Canada
                                         Real Return  bonds as  published in the
                                         Bank of  Canada  Review,  described  in
                                         CANSIM  series  V122553 (or a successor
                                         series) for the last trading  Wednesday
                                         at the  end of  the  month  immediately
                                         preceding the Anniversary Date.

                                         The  result of the  difference  is then
                                         rounded up to the next highest 0.5%.

Escalation of Pensions After Retirement: 75% of CPI,  less 1% (minimum  increase
                                         25% of CPI).  Applies  only to benefits
                                         accrued for service after  December 31,
                                         1992.

Mortality:

-- for life expectancy                   1994  Uninsured   Pensioner   Mortality
                                         Table   with   mortality   improvements
                                         projected   to  15  years   beyond  the
                                         Calculation Date.

-- for present values

    o  prior to assumed pension          Nil.
       commencement

    o  after assumed pension             1994  Uninsured   Pensioner   Mortality
       commencement                      Table   with   mortality   improvements
                                         projected    15   years    beyond   the
                                         Calculation Date.


<PAGE>
                                     - 3 -


Marital Status:                          Actual status at the Anniversary.

Age of Spouse:                           Based on actual date of birth.

Individual Tax Rate:                     Maximum  individual  marginal  tax rate
                                         for  employee's  province of employment
                                         at the Anniversary Date

Bonus:                                   Target  bonus % applied  to the  salary
                                         rate at the Valuation Date

Investment return:                       Yield on long-term Government of Canada
                                         bonds  as  published  in  the  Bank  of
                                         Canada  Review,   described  in  CANSIM
                                         series V122544 (or a successor  series)
                                         for the last  trading  Wednesday at the
                                         end of the month immediately  preceding
                                         the  Anniversary  Date  rounded down to
                                         next lower 0.5%, and then divided by 2

Decrements:                              None assumed prior to Calculation Date

Eligibility for Pensions:                100% vested

PENSION COMMENCEMENT AGE:

--   eligible for subsidized early       Payable  at  the   completion   of  the
     retirement on the Calculation       Severance   Period.   Payable   at  the
     Date (i.e., age 55 and 10 years     Calculation   Date  for   purposes   of
     of continuous service)              determining  the amount  required under
                                         Section 10.6(e).


--   not eligible for early retirement   Deferred  to age  60 or the  end of the
     on the Calculation Date             Severance  Period if later.  Payable at
                                         age 60 for purposes of determining  the
                                         amount required under Section 10.6(e).


Fluctuation reserve (1)                  15% of the pension obligations

Cost of borrowing to settle the          Yield on one month Government of Canada
obligations                              Treasury Bills as published in the Bank
                                         of Canada  Review,  described in CANSIM
                                         series V122529 (or a successor  series)
                                         for the last  trading  Wednesday at the
                                         end of the month immediately  preceding
                                         the Anniversary Date, rounded up to the
                                         next higher 0.25%, plus 1.50%

<PAGE>
                                     - 4 -



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

Notes:

(1)  Referred to by Section 10.5(g),  Section 10.6(e)(viii) and 10.6(e)(x).  The
     15% load is intended  to provide a reserve for a potential  decrease in the
     Interest  Discount  Rate in  combination  with  potential  increases in the
     Consumer Price Index for an aggregate change of 1.0%.



<PAGE>

                                  SCHEDULE "C"
                                  ------------

               AMENDED AND RESTATED AGREEMENT RESPECTING CHANGE OF
                CONTROL AND EXECUTIVE BENEFIT PLAN ENTITLEMENTS

                    ESTIMATED(1) ENTITLEMENT TO COMPENSATION
                 PURSUANT TO ARTICLE 7 OF THE RESTATED AGREEMENT


-------------------------------------------------------------------------------
Employee - Roger Thomas
-------------------------------------------------------------------------------
Base Salary                                                         $1,375,000
-------------------------------------------------------------------------------
Bonus Target Value                                                    $825,000
-------------------------------------------------------------------------------
Benefits Uplift                                                       $178,750
-------------------------------------------------------------------------------
Car Allowance                                                          $48,000
-------------------------------------------------------------------------------
Savings Plan                                                           $82,500
-------------------------------------------------------------------------------
Financial Counselling Services                                         $10,500
-------------------------------------------------------------------------------
Security Monitoring Services                                            $2,400
-------------------------------------------------------------------------------

TOTAL VALUE                                                         $2,522,150
-------------------------------------------------------------------------------

Additional Lump Sum Settlement Value of Pension(2)                  $4,388,721
-------------------------------------------------------------------------------

TOTAL ESTIMATED ENTITLEMENT                                         $6,910,871
-------------------------------------------------------------------------------


In addition to the above,  Section 7.1(c) of the Restated Agreement provides for
Executive  Outplacement  counselling  to be provided  by a firm  selected by the
Executive, at a cost to the Corporation not to exceed $25,000.

IN ADDITION to the above pension entitlement under the Agreement,  the Executive
has the following  pension  entitlements  under the Defined  Benefit  Registered
Pension Plan and  Executive  Benefit Plan. As is the case with the figures shown
above,  these  values  are  estimated  values  (as of April 1, 2008) and are for
illustrative  purposes only.  Actual values will be calculated as of the date of
the  entitlement or payment in accordance  with the Defined  Benefit  Registered
Pension Plan and the Executive Benefit Plan, respectively,  and therefore may be
subject to change.

o    Accrued Annual Defined  Benefit  Pension  Entitlement               $37,068
     (Registered  Pension Plan)(3)

o    Estimated Lump Sum Value of Executive Benefit Plan(4)            $4,253,576






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

(1)  As stated in Section 7.1 of the Restated Agreement,  the above calculations
     represent  only the  current  estimated  value (as of April 1, 2008) of the
     Executive's   entitlement  to  compensation   upon  a  Change  of  Control.
     Accordingly, the above calculations are for illustrative purposes only.


<PAGE>
                                     - 2 -


(2)  Calculated in accordance with Section 7.1(b) of the Restated  Agreement.

     -    Adjustment to EBP lump sum value to reflect settlement $1,750,125.

     -    Additional  settlement  value of pension  accrued during the severance
          period upon a change of control $2,638,596.

(3)  Benefit payable immediately at April 1, 2008.

(4)  Based on the Standards of Practice for Determining  Pension Commuted Values
     approved by the Canadian  Institute of Actuaries using rates applicable for
     April 2008 terminations.

<PAGE>

                         AMENDED AND RESTATED AGREEMENT
                   RESPECTING CHANGE OF CONTROL AND EXECUTIVE
                           BENEFIT PLAN ENTITLEMENTS

This amended and restated agreement  respecting change of control and executive
benefit plan entitlements made as of the 5th day of September, 2008.


BETWEEN:

                 NEXEN INC., a corporation incorporated under the laws
                 of Canada
                                  hereinafter referred to as the "Corporation")

                           - and -

                 GARY NIEUWENBURG

                                   (hereinafter referred to as the "Executive")

RECITALS:

1.   The  Executive,   as  Senior  Vice  President,   Synthetic  Crude  of  the
     Corporation,  is  considered  by the Board to be an essential  officer and
     employee of the  Corporation,  who is both  integral to the  operation and
     development  of the  Corporation,  and has  acquired  outstanding  skills,
     unique experience and possesses an extensive  background in, and knowledge
     of, the Corporation's business, operations and the industry in which it is
     engaged.

2.   In the  event of a Change  of  Control,  there is a  possibility  that the
     employment  of the  Executive  would be  terminated  without just cause or
     adversely  modified and the Executive has expressed concern in that regard
     to the Corporation.

3.   The Board recognizes that it is essential and in the best interests of the
     Corporation and its shareholders that the Corporation retain the continued
     dedication of the Executive to the Executive's  office and the Executive's
     employment  during the  uncertain  period prior to, during and following a
     Change of Control.

4.   The Board further  believes that the past service of the Executive and the
     Executive's  integral  role  in  the  development  and  operation  of  the
     Corporation  requires that the  Corporation  ensure that in the event of a
     Change of Control  the  Executive  is  treated  in a manner  that is fair,
     reasonable,  consistent with industry  standards and in the best interests
     of the Corporation.

5.   The  Corporation  and the  Executive  entered  into a  Change  of  Control
     Agreement on January 4, 2002 (the  "Original  Agreement")  to agree on the
     terms and conditions which would govern the termination or modification of
     the employment of the Executive following a Change of Control.


<PAGE>
                                     - 2 -


6.   The Original  Agreement was amended by an Amending Agreement dated May 30,
     2003 (the "Amending  Agreement") which, among other matters,  detailed the
     Corporation's security and funding obligations in respect of the Change of
     Control   Obligations   (as   hereinafter   defined),   provided  for  the
     securitization  and funding of the Executive  Benefit Plan Obligations (as
     hereinafter  defined) and provided  for the  cessation of the  Executive's
     coverage   under  the  Statement  of  Company   Procedure   Regarding  the
     Securitization of Nexen Inc.  Restated  Executive Benefit Plan, as amended
     or replaced from time to time (the "Securitization Procedure").

7.   The Corporation and the Executive wish to amend the Original Agreement and
     the  Amending  Agreement  as herein  provided  and,  in doing so,  wish to
     restate those agreements as herein amended (the "Restated Agreement").

NOW  THEREFORE,  in  consideration  of the mutual  covenants and agreements set
forth in this Restated Agreement and for other good and valuable consideration,
the receipt and  sufficiency of which are hereby  acknowledged  by the Parties,
the Parties agree as follows:

                                   ARTICLE 1
                                  DEFINITIONS
                                  -----------

1.1     In this Restated Agreement, the following terms shall mean as follows:

        (a)     "ACTING  JOINTLY  OR IN  CONCERT"  for  the  purposes  of  this
                Restated  Agreement,  a Person is acting  jointly or in concert
                with  another   Person  if  such  Person  has  any   agreement,
                arrangement or  understanding  (whether  formal or informal and
                whether  or not in  writing)  with such  other  Person  for the
                purpose of acquiring, offering to acquire, or voting any Common
                Shares of the Corporation (other than customary agreements with
                and between  underwriters  and banking  group or selling  group
                members with respect to a distribution  of securities by way of
                prospectus  or private  placement  or  pursuant  to a pledge of
                securities in the ordinary course of business).

        (b)     "ACTUARY"  has the meaning  referred to in Section 10.2 of this
                Restated Agreement.

        (c)     "AFFILIATE" and "ASSOCIATE"  have the meaning  ascribed to such
                terms in National Instrument 45-106.

        (d)     "ANNIVERSARY  DATE" has the meaning referred to in Section 10.3
                of this Restated Agreement.

        (e)     "ANNUAL  BASE  SALARY"  means  the  annual  base  salary of the
                Executive  payable by the  Corporation  at the end of the month
                immediately preceding the Date of Termination.


<PAGE>
                                     - 3 -


        (f)     "ANNUAL TARGET BONUS" means the Executive's annual target bonus
                as  determined  by the Board to be in effect  for the  calendar
                year in which a Change of Control occurs.

        (g)     "BANK" has the  meaning  referred  to in  Section  10.2 of this
                Restated Agreement.

        (h)     "BENEFICIAL OWNER" for the purposes of this Restated Agreement,
                a Person  shall be deemed to be the  "BENEFICIAL  OWNER" and to
                have "BENEFICIAL OWNERSHIP" of and to "BENEFICIALLY OWN":

                (i)     any  securities  as to which such Person or any of such
                        Person's  Affiliates  or Associates is the owner at law
                        or in equity;

                (ii)    any  securities  as to which such Person or any of such
                        Person's  Affiliates  or  Associates  has  a  right  to
                        acquire  (i)  upon  the  exercise  of  any  Convertible
                        Securities   or  (ii)   pursuant   to  any   agreement,
                        arrangement  or  understanding,  whether  such right is
                        exercisable  immediately  within a period of sixty (60)
                        days  thereafter and whether or not on condition or the
                        happening of any contingency, (other than (a) customary
                        agreements  with and between  underwriters  and banking
                        group and selling  group  members  with  respect to the
                        distribution  to the  public or  pursuant  to a private
                        placement of securities, or (b) pursuant to a pledge of
                        securities in the ordinary course of business); and

                (iii)   any securities which are Beneficially  Owned within the
                        meaning of clauses (a) or (b) above by any other Person
                        with which such Person is Acting Jointly or in Concert,

                provided,  however,  that a  Person  shall  not be  deemed  the
                "Beneficial  Owner" or to have "Beneficial  Ownership" of or to
                "Beneficially  Own"  any  security  where  such  Person  is the
                registered  holder of securities as a result of carrying on the
                business of or acting as nominee for a securities depository.

                For purposes of this  Restated  Agreement,  the  percentage  of
                Common Shares Beneficially Owned by any Person, shall be and be
                deemed to be the product determined by the formula:

                100 x A/B

                Where:

                A    = the number of votes for the  election  of all  directors
                     generally  attaching  to the  Common  Shares  Beneficially
                     Owned by such Person; and

                B    = the number of votes for the  election  of all  directors
                     generally attaching to all outstanding Common Shares.


<PAGE>
                                     - 4 -


                For the  purposes  of the  foregoing  formula,  where a  Person
                Beneficially  Owns unissued Common Shares which may be acquired
                pursuant to Convertible Securities, such Common Shares shall be
                deemed to be  outstanding  for the purpose of  calculating  the
                percentage of Common Shares  Beneficially  Owned by such Person
                in  both  the  numerator  and  the  denominator,  but no  other
                unissued  Common  Shares which may be acquired  pursuant to any
                other  outstanding   Convertible   Securities  shall,  for  the
                purposes of that calculation, be deemed to be outstanding.

        (i)     "BOARD"  means the Board of  Directors  of the  Corporation  as
                constituted from time to time.

        (j)     "CBCA" means the Canada Business  Corporations  Act, as amended
                from time to time, and any successor legislation thereto.

        (k)     "CALCULATION  DATE" has the meaning referred to in Section 10.5
                of this Restated Agreement.

        (l)     "CHANGE OF CONTROL" means the occurrence of any of:

                (i)     the  purchase or  acquisition  of any Common  Shares or
                        Convertible  Securities  by a  Beneficial  Owner  which
                        results in the Beneficial  Owner owning,  or exercising
                        control or direction over, Common Shares or Convertible
                        Securities  such that,  assuming only the conversion of
                        Convertible Securities Beneficially Owned or over which
                        control or direction  is  exercised  by the  Beneficial
                        Owner,  the  Beneficial  Owner  would own,  or exercise
                        control or direction  over,  Common Shares carrying the
                        right to cast more than  thirty-five  percent  (35%) of
                        the votes attaching to all Common Shares; or

                (ii)    the  substantial  completion  of: (i) the  liquidation,
                        dissolution or winding-up of the  Corporation;  or (ii)
                        the  sale,  lease  or  other   disposition  of  all  or
                        substantially all of the assets of the Corporation; or

                (iii)   a situation  in which  individuals  who were members of
                        the Board immediately prior to:

                        (A)     a   meeting   of   the   shareholders   of  the
                                Corporation involving a contest for, or an item
                                of  business   relating  to,  the  election  of
                                directors; or

                        (B)     an amalgamation,  arrangement,  merger or other
                                consolidation or combination of the Corporation
                                with another Person,

                        shall not constitute a majority of the Board  following
                        such election or transaction; or


<PAGE>
                                     - 5 -


                (iv)    the  completion  of any  transaction  or the first of a
                        series of  transactions  which  would  have the same or
                        similar   effect  as  any   transaction  or  series  of
                        transactions  referred to in  paragraphs  (i),  (ii) or
                        (iii) above; or

                (v)     a determination  by the Board that, for the purposes of
                        this  Restated  Agreement,  a  Change  of  Control  has
                        occurred or is imminent.

        (m)     "CHANGE OF CONTROL OBLIGATIONS" means the Company's obligations
                to make the lump sum payments  described in Section 7.1 of this
                Restated Agreement to the Executive.

        (n)     A "CHANGE OF CONTROL  OBLIGATIONS - DESIGNATED  EVENT" shall be
                deemed to have occurred if:

                (i)     the  Corporation  fails to arrange for the extension or
                        replacement  of a Letter of Credit in  accordance  with
                        the terms of this Restated Agreement; or

                (ii)    the Executive's  employment is terminated in accordance
                        with Section 5.1 or 6.1 of this Restated Agreement.

        (o)     "COMMON SHARES" means the common shares of the Corporation.

        (p)     "CONVERTIBLE SECURITIES" means:

                (i)     any right  (contractual  or otherwise and regardless of
                        whether such right  constitutes  a security) to acquire
                        Common Shares from the Corporation; or

                (ii)    any  security  issued by the  Corporation  from time to
                        time  (other  than  the  rights  issued  pursuant  to a
                        shareholders'  rights protection plan, if any) carrying
                        any exercise, conversion or exchange right,

                which is then  exercisable  or  exercisable  within a period of
                sixty  (60) days from that time  pursuant  to which the  holder
                thereof may acquire Common Shares or other securities which are
                convertible  into or  exercisable  or  exchangeable  for Common
                Shares (in each case, whether such right is then exercisable or
                exercisable  within a period of sixty  (60) days from that time
                and  whether  or  not on  condition  or  the  happening  of any
                contingency).

        (q)     "DATE OF TERMINATION" means the date upon which the Executive's
                employment is terminated pursuant to Section 4.1, 5.1 or 6.1 of
                this  Restated  Agreement.  For  greater  clarity,  the Date of
                Termination means the date upon which the Corporation  provides
                the  Executive  with  written,  verbal or other notice that the
                Executive's  employment has been or will be terminated pursuant
                to Section 4.1 or 5.1 of this  Restated  Agreement  or the date
                upon which the Executive  provides the Corporation with written
                notice  terminating  the  Executive's  employment  pursuant  to
                Section 4.1 or for Good Reason pursuant to Section 6.1.


<PAGE>
                                     - 6 -


        (r)     "DISABILITY"   means,   where  due  to  a  physical  or  mental
                condition,  the Executive is rendered  totally and  permanently
                unable to perform  the  Executive's  duties  for a  consecutive
                period of two (2) years or more during which the  Executive has
                been in receipt of long term disability insurance benefits from
                the insurance carrier normally utilized by the Corporation.

        (s)     "DISPUTE"  has the meaning  referred to in Section 11.1 of this
                Restated Agreement.

        (t)     "EFFECTIVE  DATE" means the date upon which a Change of Control
                occurs.

        (u)     "EMPLOYMENT  BENEFITS"  means the employment  benefits to which
                the  Executive  is entitled by virtue of any  written,  oral or
                implied  agreement  with the  Corporation.  For the purposes of
                this Restated Agreement,  "Employment  Benefits" shall include,
                but is not limited to, the following:

                (i)     the  Executive's  entitlement  to any dental or general
                        medical care;

                (ii)    the  Executive's   entitlement  to  receive  long  term
                        disability benefits from the insurance carrier normally
                        utilized by the Corporation;

                (iii)   the Executive's  entitlement to pension  benefits under
                        the terms of any pension plan with the Corporation;

                (iv)    the Executive's  entitlement to a monthly car allowance
                        from the Corporation;

                (v)     the  Executive's  entitlement to  contributions  by the
                        Corporation to the Corporation's savings plan;

                (vi)    the   Executive's   entitlement  to  receive  from  the
                        Corporation financial counseling services, at a cost of
                        $3,500.00  per year  (or as the  same may be  increased
                        from time to time by the Corporation); and

                (vii)   the   Executive's   entitlement  to  receive  from  the
                        Corporation   security   monitoring   services  at  the
                        Executive's personal residence.

        (v)     "EXECUTIVE BENEFIT PLAN" has the meaning referred to in Section
                7.1(b) of this Restated Agreement.

        (w)     "EXECUTIVE  BENEFIT PLAN  OBLIGATIONS"  means the Corporation's
                outstanding obligations under the Executive Benefit Plan to the
                Executive.

        (x)     An  "EXECUTIVE  BENEFIT PLAN  OBLIGATIONS  - DESIGNATED  EVENT"
                shall be deemed to have occurred if:

                (i)     a Change of Control occurs;


<PAGE>
                                     - 7 -


                (ii)    the Corporation  makes an assignment for the benefit of
                        creditors or files a petition in  bankruptcy or becomes
                        insolvent or bankrupt;

                (iii)   a  receiver,  trustee  or  liquidator  of  or  for  the
                        Corporation is appointed and is not discharged within a
                        period of sixty days;

                (iv)    the  net  worth  of  the   Corporation,   described  as
                        shareholder   equity  in  the  consolidated   financial
                        statements  of  the  Corporation  as  disclosed  in the
                        annual and quarterly  consolidated financial statements
                        of the Corporation, is less than $400 million;

                (v)     the  Corporation  fails to arrange for the extension or
                        replacement  of a Letter of Credit in  accordance  with
                        the terms of this Restated Agreement;

                (vi)    the Executive has provided written  notification to the
                        Trustee  and to the  Corporation  of the failure by the
                        Corporation  to pay any amount owed to or in respect of
                        the Executive  under the Executive  Benefit Plan within
                        thirty days of the due date  specified in the Executive
                        Benefit Plan  (together  with a statement of the amount
                        due and owing)  either to the person  entitled  thereto
                        pursuant to the Executive  Benefit Plan or to the Trust
                        in accordance  with the provisions of Section  10.6(h);
                        or

                (vii)   at any time the Board adopts a resolution to the effect
                        that,  for  purposes  of this  Restated  Agreement,  an
                        Executive  Benefit Plan  Obligations - Designated Event
                        has occurred or is imminent.

        (y)     "GOOD REASON" means any of the following,  unless the Executive
                shall  have  given  the  Executive's  express  written  consent
                thereto:

                (i)     INCONSISTENT DUTIES. The assignment to the Executive of
                        any duties  inconsistent with the Executive's status as
                        an executive  officer of the  Corporation or a material
                        alteration  in the nature or status of the  Executive's
                        responsibilities  or duties or  reporting  relationship
                        from those in effect  immediately  prior to a Change of
                        Control;

                (ii)    REDUCED  SALARY.  A reduction by the Corporation in the
                        Executive's   Annual  Base  Salary  in  effect  on  the
                        Effective   Date  or  as  the  same  may  be  increased
                        thereafter  from  time to time  or the  failure  by the
                        Corporation to grant the Executive  salary increases at
                        a rate  commensurate  with the  increases  accorded  to
                        other executives of the Corporation;

                (iii)   RELOCATION.  The Corporation requiring the Executive to
                        be based  anywhere  other than where the  Executive  is
                        based at the time a Change of  Control  occurs,  except
                        for required travel on the Corporation's business to an
                        extent  substantially  consistent  with the Executive's
                        business  travel  obligations in the ordinary course of
                        business immediately prior to a Change of Control;


<PAGE>
                                     - 8 -


                (iv)    INCENTIVE   COMPENSATION  PLANS.  The  failure  by  the
                        Corporation   to  continue  in  effect  any   incentive
                        compensation plan in which the Executive  participates,
                        including,   but  not   limited   to,   the   Incentive
                        Compensation Plan or the Stock Option Plan or any other
                        similar  plans  adopted  prior to a Change of  Control,
                        unless the Executive is eligible to participate in, and
                        is entitled to the  opportunity to receive a comparable
                        level of  benefits  under,  an ongoing,  substitute  or
                        alternative  plan (it being  understood that the manner
                        or method of payment and the form of consideration need
                        not be the same as existed in the original  plans);  or
                        the  failure  by  the   Corporation   to  continue  the
                        Executive's   participation  therein  on  at  least  as
                        favourable  a basis,  both in terms  of the  amount  of
                        benefits  available to the  Executive  and the level of
                        the   Executive's   participation   relative  to  other
                        participants,  as  existed  at  the  time a  Change  of
                        Control occurs;

                (v)     EMPLOYMENT BENEFITS AND PERQUISITES. The failure by the
                        Corporation  to continue to provide the Executive  with
                        Employment  Benefits  at least as  favourable  as those
                        enjoyed by the Executive  immediately prior to a Change
                        of Control, including any pension plan, benefit plan or
                        any   retirement   arrangement   established   for  the
                        Executive,  or any of the Corporation's life insurance,
                        medical,  health and  accident,  disability  or savings
                        plans in which the Executive was  participating  at the
                        time a Change  of  Control  occurs;  the  taking of any
                        action  by  the  Corporation  that  would  directly  or
                        indirectly  materially  reduce  any  such  benefits  or
                        deprive  the  Executive  of  any  material   perquisite
                        enjoyed  by the  Executive  at the  time  a  Change  of
                        Control occurs,  including,  without  limitation and to
                        the  extent  applicable,  the  use of a car,  aircraft,
                        secretarial   services,   office   space,   telephones,
                        computer facilities,  expense reimbursement,  financial
                        counselling,   and  professional  fees  and  club  dues
                        reimbursement;  or the  failure by the  Corporation  to
                        provide the Executive  with the number of paid vacation
                        days to which the  Executive is entitled in  accordance
                        with the  Corporation's  normal  vacation  practice  in
                        effect at the time a Change of Control occurs;

                (vi)    NO  ASSUMPTION   BY  SUCCESSOR.   The  failure  of  the
                        Corporation to obtain a  satisfactory  agreement from a
                        successor to assume and agree to perform this  Restated
                        Agreement.    Alternatively,   if   the   business   or
                        undertaking  in connection  with which the  Executive's
                        services are principally  performed is sold at any time
                        after a Change of Control  occurs,  and the Executive's
                        employment is transferred  as a result,  the failure or
                        refusal  of  the   purchaser   of  such   business   or
                        undertaking to provide the Executive with the same or a
                        comparable position, duties, compensation and benefits,
                        as  described  in  paragraphs  (iv) and (v)  above,  as
                        provided   to  the   Executive   by   the   Corporation
                        immediately prior to a Change of Control;


<PAGE>
                                     - 9 -


                (vii)   DISPOSITION   OF  "ALL  OR   SUBSTANTIALLY   ALL".  The
                        disposition by the Corporation of all or  substantially
                        all of the assets of the  Corporation,  as contemplated
                        herein,  notwithstanding  that the Executive's services
                        were  or  were  not  principally   performed  for  such
                        business.

        (z)     "HEARING"  has the meaning  referred to in Section 11.7 of this
                Restated Agreement.

        (aa)    "HEARING  DATE" has the meaning  referred to in Section 11.7 of
                this Restated Agreement.

        (bb)    "INCENTIVE  COMPENSATION  PLAN"  means any  bonus or  incentive
                compensation  plan of the Corporation in which the Executive is
                entitled to receive benefits in the month immediately preceding
                a Change of Control.

        (cc)    "JUST CAUSE" means:

                (i)     the failure by the Executive to  substantially  perform
                        the  Executive's  duties  according to the terms of the
                        Executive's  employment in existence  immediately prior
                        to a Change of Control after the  Corporation has given
                        the Executive  reasonable  notice of such failure and a
                        reasonable opportunity to correct it; or

                (ii)    where the  Executive  engages  in any  criminal  act or
                        dishonesty resulting or intended to result, directly or
                        indirectly,  in the personal  gain of the  Executive at
                        the Corporation's expense.

        (dd)    "LETTER OF CREDIT" has the meaning  referred to in Section 10.2
                of this Restated Agreement.

        (ee)    "MONTHLY BASE SALARY" means the monthly  salary  payable to the
                Executive by the  Corporation in effect at the end of the month
                immediately preceding the Effective Date.

        (ff)    "NOTICE OF DISPUTE" has the meaning referred to in Section 11.1
                of this Restated Agreement.

        (gg)    "OBLIGATIONS"  means,  collectively,   the  Change  of  Control
                Obligations and the Executive Benefit Plan Obligations.

        (hh)    "PARTIES"  means  the  Corporation,   and  its  successors  and
                permitted assigns, and the Executive and the Executive's heirs,
                executors  and  administrators  and "PARTY" means either one of
                them.


<PAGE>
                                    - 10 -


        (ii)    "PERSON" includes an individual, partnership, association, body
                corporate,    trustee,    executor,    administrator,     legal
                representative and any national, provincial, state or municipal
                government or any agency thereof.

        (jj)    "REFUNDABLE  TAX  ACCOUNT"  means the  refundable  tax  account
                maintained  in  respect  of the  Trust  by the  Canada  Revenue
                Agency.

        (kk)    "REGISTERED  PENSION  PLAN"  has  the  meaning  referred  to in
                Section 7.1(b) of this Restated Agreement.

        (ll)    "RESTATED  AGREEMENT" means this amended and restated agreement
                respecting   change  of  control  and  executive  benefit  plan
                entitlements  as it may be amended,  restated  or  supplemented
                from  time to time,  and the  expressions  "hereof",  "herein",
                "hereto", "hereunder",  "hereby", and similar expressions refer
                to this Restated  Agreement and,  unless  otherwise  indicated,
                refer to Articles or Sections in this Restated Agreement only.

        (mm)    "SECURITIZATION  PROCEDURE" has the meaning  referred to in the
                recitals of this Restated Agreement.

        (nn)    "SEVERANCE  PERIOD"  means the  twenty-four  (24) month  period
                immediately following the Date of Termination.

        (oo)    "STOCK OPTION PLAN" means any stock option plan or plans of the
                Corporation  pursuant to which the Executive is granted options
                by the Corporation to acquire Common Shares.

        (pp)    "SUBSIDIARY" has the meaning ascribed to it in the CBCA.

        (qq)    "TAX ACT" means the Income Tax Act (Canada) and the Regulations
                thereunder, both as amended from time to time.

        (rr)    "TERM"  has the  meaning  referred  to in  Section  3.1 of this
                Restated Agreement.

        (ss)    "TRUST"  has the meaning  referred  to in Section  10.1 of this
                Restated Agreement.

        (tt)    "TRUST  AGREEMENT" has the meaning  referred to in Section 10.1
                of this Restated Agreement.

        (uu)    "TRUSTEE"  means CIBC Mellon Trust  Company or such other trust
                company  duly  incorporated  under  the laws of  Canada  or any
                province  thereof whom the Company may designate as the trustee
                in connection with the security and funding of the Obligations.

        (vv)    "VALUATION DATE" has the meaning referred to in Section 10.3 of
                this Restated Agreement.


<PAGE>
                                    - 11 -


                                   ARTICLE 2
                          SCOPE OF RESTATED AGREEMENT
                          ---------------------------

2.1     The Parties  intend  that this  Restated  Agreement  sets out (a) their
        respective  rights and  obligations  upon the occurrence of a Change of
        Control and in connection  with the  securitization  and funding of the
        Change of  Control  Obligations;  and (b) their  respective  rights and
        obligations  regarding the  securitization and funding of the Executive
        Benefit Plan Obligations.  This Restated Agreement does not provide for
        any other terms of the  Executive's  employment  with the  Corporation,
        except as expressly provided for herein.

2.2     The Parties hereby confirm that except as otherwise expressly stated in
        this Restated  Agreement,  insofar as the securitization and funding of
        the Executive Benefit Plan Obligations is concerned,  the terms of this
        Restated  Agreement  shall  govern and the terms of the  Securitization
        Procedure shall not be applicable.

2.3     This Restated Agreement shall automatically terminate upon the death of
        the  Executive or where due to the  Disability  of the  Executive,  the
        Executive is materially  incapacitated  from performing the Executive's
        duties.  In the event of the death or Disability of the Executive,  the
        Executive (or the Executive's estate) shall be entitled to receive from
        the  Corporation  all unpaid Annual Base Salary,  Employment  Benefits,
        unpaid business expenses and vacation  entitlement  accrued to the date
        of the death or  Disability  of the  Executive.  The  Executive (or the
        Executive's estate) shall also be entitled to receive any and all death
        or Disability  benefits in a manner consistent with, and at least equal
        in amount to, those provided by the  Corporation  to senior  executives
        (or their estate) under such plans,  programs and policies in effect at
        the date of Disability or death of the Executive,  and the  Corporation
        shall have no further  obligations to the Executive or the  Executive's
        estate under this Restated Agreement. Any entitlements of the Executive
        (or the  Executive's  estate)  under the  Executive  Benefit Plan which
        remain following the termination of this Restated Agreement pursuant to
        this  Section  2.3  shall  then   commence  to  be  covered  under  the
        Securitization Procedure.

2.4     If the  Executive's  employment is terminated by either Party,  for any
        reason,  prior  to a  Change  of  Control  in any  manner,  other  than
        expressly  provided  for in  this  Restated  Agreement,  this  Restated
        Agreement shall automatically  terminate and the Corporation shall have
        no  further  obligations  to the  Executive  hereunder.  Any  remaining
        entitlements  of the Executive  under the Executive  Benefit Plan which
        remain following the termination of this Restated Agreement pursuant to
        this  Section  2.4  shall  then   commence  to  be  covered  under  the
        Securitization Procedure.

                                   ARTICLE 3
                           TERM OF RESTATED AGREEMENT
                           --------------------------

3.1     Subject to termination of this Restated  Agreement prior to a Change of
        Control,  this Restated  Agreement  shall remain in effect for a period
        concluding  twelve  (12)  months  following  the  Effective  Date  (the
        "Term"),  at  which  time  this  Restated  Agreement  shall  terminate;
        provided  however that the payment of compensation  and benefits to the
        Executive  under this Restated  Agreement shall continue beyond the end
        of the  Term in  accordance  with  the  applicable  provisions  of this
        Restated Agreement.  Any remaining  entitlements of the Executive under
        the Executive  Benefit Plan which remain  following the  termination of
        this  Restated  Agreement  pursuant  to this  Section  3.1  shall  then
        commence to be covered under the Securitization Procedure.


<PAGE>
                                    - 12 -


                                   ARTICLE 4
            TERMINATION FOR JUST CAUSE OR FOR OTHER THAN GOOD REASON
            --------------------------------------------------------

4.1     If the  Executive's  employment  is  terminated  for Just Cause,  or is
        terminated by the  Executive,  other than for Good Reason,  following a
        Change of Control,  the Corporation shall pay to the Executive,  if not
        already  paid,  the fraction of the unpaid  Annual Base Salary  accrued
        during the then  current  fiscal year of the  Corporation,  all accrued
        Employment  Benefits,  all unpaid reasonable  business expenses and all
        unpaid   vacation  pay  accrued  up  to  and   including  the  Date  of
        Termination,  and  thereafter,  the  Corporation  shall have no further
        obligations to the Executive under this Restated Agreement.

4.2     Nothing in this  Restated  Agreement  shall serve to derogate  from the
        vested rights of the Executive to pension benefits,  Stock Option Plans
        or any other Employment  Benefits to which the Executive is entitled up
        to the Date of Termination.

                                   ARTICLE 5
                           TERMINATION BY CORPORATION
                           --------------------------

5.1     If the Executive's  employment is terminated by the Corporation  within
        the twelve (12) month period  following the Effective  Date, for reason
        other than Just Cause,  death or Disability,  the Corporation shall pay
        to the  Executive  the  remuneration  referred  to in Article 7 of this
        Restated Agreement.

                                   ARTICLE 6
                          TERMINATION FOR GOOD REASON
                          ---------------------------

6.1     In the event of a Change of  Control,  the  Executive  may,  within the
        twelve  (12)  month  period  following  the  Effective  Date  and  upon
        providing the Corporation with ten (10) days written notice,  terminate
        the Executive's  employment with the Corporation for Good Reason.  Upon
        being  provided  with such  notice,  the  Corporation  shall pay to the
        Executive  the  remuneration  referred to in Article 7 of this Restated
        Agreement.

                                   ARTICLE 7
                         COMPENSATION UPON TERMINATION
                         -----------------------------

7.1     If the Executive's  employment is terminated in accordance with Section
        5.1 or 6.1 of this Restated Agreement:


<PAGE>
                                    - 13 -


        (a)     the Corporation  shall  forthwith,  but in any event within ten
                (10) days from receipt by the Corporation of a Release executed
                by the Executive substantially in the form of Schedule "A", pay
                to the Executive:

                (i)     if not previously paid, that portion of the Executive's
                        accrued but unpaid Monthly Base Salary, any accrued but
                        unpaid bonus to which the Executive is entitled for the
                        preceding    calendar    year   under   any   Incentive
                        Compensation  Plan,  all  unpaid  reasonable   business
                        expenses and all accrued but unused vacation pay earned
                        or payable to the Executive by the  Corporation for the
                        period from the  beginning  of the  Corporation's  then
                        current  fiscal year,  up to and  including the Date of
                        Termination;

                (ii)    a lump  sum  cash  payment  equal  to  the  Executive's
                        Monthly  Base  Salary  and  one-twelfth  (1/12)  of the
                        Executive's  Annual  Target Bonus for each month of the
                        Severance Period;

                (iii)   a lump sum payment  equal to thirteen  percent (13%) of
                        the  Executive's  Annual Base Salary for the  Severance
                        Period  representing  the value of the group health and
                        welfare benefits for the Severance Period;

                (iv)    a  lump  sum  payment  representing  the  value  of the
                        Executive's  monthly car  allowance  for the  Severance
                        Period;

                (v)     a  lump  sum  payment  representing  the  value  of the
                        Corporation's   contributions   to  the   Corporation's
                        savings  plan  (at a rate  of six  percent  (6%) of the
                        Executive's  Annual  Base  Salary)  for  the  Severance
                        Period;

                (vi)    a  lump  sum  payment  representing  the  value  of the
                        Executive's entitlement to receive from the Corporation
                        financial counseling services for the Severance Period;
                        and

                (vii)   a  lump  sum  payment  representing  the  value  of the
                        Executive's entitlement to receive from the Corporation
                        security   monitoring   services  at  the   Executive's
                        personal residence for the Severance Period;

        (b)     with respect to the Executive's entitlement to pension benefits
                under the Pension  Plan for  Employees  of Nexen Inc.  (Defined
                Benefit Option) (the  "Registered  Pension Plan"),  if any, and
                the  Executive's  related  entitlement  under  the  Nexen  Inc.
                Restated Executive Benefit Plan (the "Executive Benefit Plan"),
                if any:

                (i)     the Corporation  shall  recognize the Severance  Period
                        for   purposes   of   determining    the    Executive's
                        entitlement;

                (ii)    for calculation purposes,  the Executive's  entitlement
                        is  the  benefit  which  would  have  been   determined
                        assuming   that  the   Executive   had  been   employed
                        throughout the Severance Period,  including recognition
                        of:


<PAGE>
                                    - 14 -


                        (A)     additional   service   that   would  have  been
                                credited for the Severance Period;

                        (B)     monthly salary equal to the Executive's Monthly
                                Base Salary throughout the Severance Period;

                        (C)     pensionable  bonus  for the year of the Date of
                                Termination,  and for each  subsequent  year or
                                portion  thereof  during the Severance  Period,
                                determined  at the Annual  Target  Bonus level.
                                Average bonus will be determined over the three
                                years  to  the  end of  the  Severance  Period,
                                including any partial calendar years; and

                        (D)     if the  Executive  would have been eligible for
                                early  retirement  at the end of the  Severance
                                Period,   the  Executive  shall  be  deemed  to
                                retire,  and  the  pension  to  commence,  upon
                                completion  of the  Severance  Period.  In such
                                case, the  Executive's  attained age at the end
                                of the Severance  Period will be recognized for
                                purposes of  calculating  the early  retirement
                                reduction factor, if applicable; and

                (iii)   the  pension  entitlements  described  in this  Section
                        7.1(b) shall,  to the extent  legally  permissible,  be
                        provided  through the  Registered  Pension Plan. To the
                        extent  that it is not legally  permissible  to provide
                        such  pension   entitlements   through  the  Registered
                        Pension  Plan,  the   Corporation   shall  pay  to  the
                        Executive   a  lump  sum   payment   representing   the
                        settlement  value of the additional  Executive  Benefit
                        Plan  benefit   determined  in   accordance   with  the
                        assumptions set forth in Schedule "B-1";

                (iv)    any  entitlements  of the Executive under the Executive
                        Benefit  Plan  which  have  previously  been  funded in
                        accordance  with Article 10 but not previously  settled
                        in  accordance  with Article 10 shall be settled by the
                        Corporation  in  accordance  with the  assumptions  set
                        forth in Schedule "B-1";

        (c)     with respect to the Executive's entitlement to pension benefits
                under the Pension  Plan for  Employees  of Nexen Inc.  (Defined
                Contribution Option) (the "Defined Contribution Pension Plan"),
                if any,  and the  Executive's  related  entitlement  under  the
                Executive Benefit Plan, if any:

                (i)     the  Corporation  shall  make  a  contribution  to  the
                        Defined Contribution Pension Plan in an amount which is
                        equal to the additional  contributions which would have
                        been made by both the Executive and the  Corporation to
                        the   Defined   Contribution   Pension   Plan   on  the
                        Executive's  behalf during the Severance Period had the
                        Executive  remained  in the  employ of the  Corporation
                        during  such  period.   Such   contribution   shall  be
                        calculated  at the rate in  effect  in  respect  of the
                        Executive immediately prior to the Date of Termination.
                        To the extent  that it is not  legally  permissible  to
                        make  such  contribution  to the  Defined  Contribution
                        Pension  Plan,  the  Corporation  shall make a notional
                        allocation to the defined contribution provision of the
                        Executive Benefit Plan equal to such contribution;


<PAGE>
                                    - 15 -


                (ii)    the Corporation  shall  recognize the Severance  Period
                        for purposes of determining the Executive's entitlement
                        under the Executive Benefit Plan;

                (iii)   the Corporation shall make a notional allocation to the
                        defined contribution provision of the Executive Benefit
                        Plan in an  amount  which is  equal  to the  additional
                        notional  allocations which would have been made by the
                        Corporation  to the defined  contribution  provision of
                        the Executive  Benefit Plan on the  Executive's  behalf
                        during the Severance Period had the Executive  remained
                        in the employ of the  Corporation  during such  period.
                        Such  contribution  shall be  calculated at the rate in
                        effect in respect of the Executive immediately prior to
                        the Date of Termination.  The Corporation  shall make a
                        lump sum payment to the Executive in an amount equal to
                        the balance,  after  reflection  of the  aforementioned
                        notional allocation, in the Executive's DC Supplemental
                        Company  Account as defined  in the  Executive  Benefit
                        Plan;

        (d)     the  Corporation  shall  provide the Executive  with  executive
                outplacement  counselling  to  be  provided  by a  firm  to  be
                selected by the Executive,  at a cost to the Corporation not to
                exceed $25,000.00;

        (e)     all of the Executive's outstanding  unexercisable stock options
                under any Stock Option Plan shall become exercisable; and

        (f)     where the Executive has been  relocated,  at the request of the
                Corporation,  within the two (2) year period  immediately prior
                to the Effective  Date, if so requested by the  Executive,  the
                Corporation   shall   relocate  the   Executive   back  to  the
                Executive's prior location.

7.2     The  estimated  value as of April 1,  2008 of  Sections  7.l(a)(ii)  to
        7.1(d) are set out in Schedule  "C".  Schedule "C"  provides  estimated
        values only and actual values shall be  calculated  in accordance  with
        this  Restated  Agreement at the time of  entitlement  or payment under
        this Restated Agreement.

7.3     If the  Executive's  employment  is  terminated  in  the  circumstances
        described  in  Section  5.1 or  6.1 of  this  Restated  Agreement,  the
        remuneration  and  benefits  payable  under this Article 7 shall not be
        reduced if the Executive obtains alternative employment.

7.4     Unless expressly  provided  otherwise in this Restated  Agreement,  all
        payments  to be made to the  Executive  under  this  Article 7 shall be
        subject to required statutory deductions at source by the Corporation.


<PAGE>
                                    - 16 -


                                   ARTICLE 8
                            CONFIDENTIAL INFORMATION
                            ------------------------

8.1     If the  Executive's  employment is terminated in any manner  whatsoever
        due to or following a Change of Control,  the Executive  agrees to keep
        confidential  all information of a confidential  or proprietary  nature
        concerning the Corporation, its Affiliates, Associates and Subsidiaries
        and their respective operations,  opportunities, areas of present, past
        or  future  interests,  assets,  finances,   technology,   intellectual
        property,  business  and  affairs,  and further  agrees not to use such
        information,  data or technology for personal advantage,  provided that
        nothing  herein shall prevent the  disclosure of  information  which is
        publicly  available  or  which  is  required  to be  disclosed  by  the
        Executive under appropriate statute, rules of law or legal process.

                                   ARTICLE 9
              RIGHTS AND OBLIGATIONS OF EXECUTIVE UPON TERMINATION
              ----------------------------------------------------

9.1     Subject to Section 8.1 of this Restated Agreement,  the Executive shall
        not be prohibited in any manner  whatsoever from obtaining  alternative
        employment  with or otherwise  forming or  participating  in a business
        competitive to the business of the Corporation after the termination of
        the Executive's employment with the Corporation.

9.2     Upon the termination of the Executive's  employment for any reason, the
        Executive  shall tender the Executive's  resignation  from any position
        the Executive may hold as an officer or director of the  Corporation or
        any of its Affiliates, Associates or Subsidiaries.

9.3     If the  Executive's  employment  is  terminated  in  the  circumstances
        described  in  Section  5.1 or  6.1 of  this  Restated  Agreement,  the
        Corporation  shall  continue to purchase  and  maintain,  to the extent
        available in the marketplace at reasonable cost to the Corporation,  on
        behalf of the Executive,  director and officer liability  insurance for
        the  applicable  limitation  period  following  the date upon which the
        Executive  ceases to serve as a director or officer of the Corporation,
        and the Executive's  existing  agreement to receive  indemnity from the
        Corporation for acts taken by the Executive in the Executive's capacity
        as an officer of the Corporation shall remain in effect.

9.4     Upon termination of the Executive's  employment pursuant to Section 5.1
        or 6.1 of this Restated Agreement,  the Corporation shall reimburse the
        Executive for ongoing legal fees and disbursements  which the Executive
        may reasonably  incur in connection  with this Restated  Agreement (but
        this Restated Agreement only),  including any litigation concerning the
        validity or  enforceability  of, or liability  under,  any provision of
        this Restated Agreement or any action by the Executive. The Corporation
        shall pay such fees and  reimbursements  to the  Executive  promptly as
        such fees and disbursements become due.


<PAGE>
                                    - 17 -


                                 ARTICLE 10
                      SECURITIZATION AND FUNDING PROCEDURE
                      ------------------------------------

10.1    The  Corporation  has established and maintains a trust for the benefit
        of the  Executive  and  persons  claiming  through  him  (the  "Trust")
        pursuant to the terms and  conditions of a trust  agreement (the "Trust
        Agreement") between the Corporation and the Trustee. The Trust shall be
        funded in accordance with the provisions of this Restated Agreement and
        the Trust Agreement.

10.2    To provide security against a failure by the Corporation to either fund
        or settle the  Obligations in accordance with the terms of this Article
        10, the Trust Agreement  provides for the funding of the Trust with the
        proceeds  of an  irrevocable  letter  of  credit  which  satisfies  the
        requirements  of this Restated  Agreement (a "Letter of Credit") in the
        event  that  the  Corporation   does  not  provide  funding  or  effect
        settlement  when required to do so hereunder and in accordance with the
        terms  hereof.  The  Corporation  confirms  that the  Letter  of Credit
        currently  held by the  Trustee  has been  issued  by a major  Canadian
        chartered   bank  (the   "Bank")  in  an  amount   calculated   by  the
        Corporation's consulting actuary (who at all times shall be a Fellow of
        the Canadian Institute of Actuaries) (the "Actuary") in accordance with
        the provisions of Section 10.5 of this Restated Agreement.

10.3    On each February 1st (the  "Anniversary  Date"),  the Corporation shall
        request a report  from the Actuary as to the amount  calculated,  as at
        the next  succeeding  April 1st (the "Valuation  Date"),  in accordance
        with the  provisions  of Section 10.5 of this Restated  Agreement.  The
        Corporation  shall  provide  the  Actuary  with the data it requires to
        prepare  such  report.   Upon  completion  of  each  such  report,  the
        Corporation  shall arrange for the Actuary to provide a summary of same
        to the Trustee.

        Prior to the funding  and/or  settlement of all of the  Obligations  in
        accordance with the terms of this Restated  Agreement,  the Corporation
        shall, within forty-five days after the applicable Anniversary Date and
        in accordance with the terms of the report received from the Actuary:

        (a)     either:

                (i)     arrange  for a Letter of Credit to be  provided  by the
                        Bank to the  Trustee  to  replace  the Letter of Credit
                        then held by the  Trustee.  The  replacement  Letter of
                        Credit shall be:

                        (A)     substantially  in the  form  of the  Letter  of
                                Credit then held by the Trustee;

                        (B)     in an amount  calculated  by the  Actuary as at
                                the  applicable  Valuation  Date in  accordance
                                with the  provisions  of  Section  10.5 of this
                                Restated Agreement; and


<PAGE>
                                    - 18 -


                        (C)     for a term which  commences  on the date of its
                                issuance  and  expires one year  following  the
                                applicable Valuation Date; or

                (ii)    confirm to the  Trustee  in writing  that the Letter of
                        Credit  then  held  by the  Trustee  will  be  extended
                        automatically   for  a  further   one-year   term.  The
                        confirmation to the Trustee shall include evidence from
                        the Bank as to any amendment to the  applicable  Letter
                        of Credit, any such amendment to be consistent with the
                        report  prepared  by the  Actuary as at the  applicable
                        Valuation Date; and

        (b)     contribute  to the  Trust an  amount  equal  to  twice  the fee
                charged  by the Bank in  connection  with the  Letter of Credit
                extension or replacement,  as applicable. The Corporation shall
                withhold  one-half  of such  amount  and  shall  remit the said
                one-half of such amount to the Canada Revenue Agency on account
                of the  tax  which  is  exigible  pursuant  to the  Tax  Act in
                connection  with such  contribution  to the Trust.  The Trustee
                shall remit the  remaining  one-half of such amount to the Bank
                in  consideration   for  the  Letter  of  Credit  extension  or
                replacement, as applicable.

        When a  replacement  Letter of Credit has been  provided in  accordance
        with the terms of this Section 10.3, an existing Letter of Credit shall
        be surrendered and cancelled.

10.4    If,  during  the term of a Letter of  Credit  issued  pursuant  to this
        Restated Agreement, the Corporation, acting reasonably,  concludes that
        there has been a significant  change in the Obligations  since the date
        of the last report prepared by the Actuary  pursuant to Section 10.3 of
        this Restated  Agreement,  the Corporation  shall request a report from
        the Actuary as to the then current value of the Obligations, calculated
        in  accordance  with the  provisions  of Section 10.5 of this  Restated
        Agreement.  Upon receipt of the report, the Corporation shall provide a
        summary of same to the Trustee and arrange,  together with the Trustee,
        for any  required  increase  or decrease in the amount of the Letter of
        Credit  for the  balance of the term of such  Letter of Credit.  In the
        event  that a  replacement  Letter  of  Credit  is to be  issued in the
        circumstances  described in this Section 10.4, the  Corporation and the
        Trustee  shall  arrange  for such  replacement  Letter  of Credit to be
        provided  by the Bank to the  Trustee to  replace  the Letter of Credit
        then held by the  Trustee.  Upon  receipt  of a  replacement  Letter of
        Credit  pursuant to this Section 10.4, the Trustee shall  surrender for
        cancellation  the  Letter of Credit  then held by it  pursuant  to this
        Restated Agreement and the Trust Agreement.


<PAGE>
                                    - 19 -


        In the event that all or any portion of the fee  referred to in Section
        10.3 of this Restated Agreement, is refunded by the Bank as a result of
        a decrease in the amount of a Letter of Credit pursuant to this Section
        10.4, such amount (together with any resulting refundable Tax) shall be
        received by the Trustee  for deposit to the Trust.  Upon  receipt of an
        Authorized Instruction (as defined in the Trust Agreement), the Trustee
        shall pay and transfer such amounts (less any  applicable  tax which it
        will remit as required by the Tax Act on behalf of the  Corporation) to
        the Corporation for its sole and exclusive use and benefit.

        In the event that an additional  fee is required to be paid to the Bank
        as a result of an increase in the amount of a Letter of Credit pursuant
        to this Section 10.4, the Corporation  shall contribute to the Trust an
        amount  equal  to twice  the  additional  fee.  The  Corporation  shall
        withhold  one-half of such amount and shall remit the said  one-half of
        such amount to the Canada Revenue Agency on account of the tax which is
        exigible  pursuant to the Tax Act in connection with such  contribution
        to the Trust.  The Trustee shall remit the  remaining  one-half of such
        amount to the Bank in payment of its additional fee.

10.5    A Letter of Credit issued pursuant to this Restated Agreement shall:

                (i)     be an irrevocable standby letter of credit;

                (ii)    obligate the Bank to satisfy demand for payment made by
                        the  Trustee  in  accordance  with  the  terms  of this
                        Restated Agreement and the Trust Agreement;

                (iii)   permit partial drawings; and

                (iv)    provide  that the Bank must  notify  the  Trustee on or
                        before  thirty  days prior to the expiry of a Letter of
                        Credit of any notice of  non-extension  provided by the
                        Bank to the Corporation.

        The amount of a Letter of Credit  pursuant to this  Restated  Agreement
        shall be  calculated  by the Actuary in  accordance  with the following
        subparagraphs of this Section 10.5.

        (a)     Assuming the lump sum payments referred to in Section 7.1(a) of
                this  Restated  Agreement  are  equal  to  the  amount  thereof
                provided by the Corporation.

        (b)     Assuming  the  service  of the  Executive  will  terminate,  in
                accordance with Section 5.1 or 6.1 of this Restated  Agreement,
                on the next succeeding March 31st after the Valuation Date (the
                "Calculation Date").

        (c)     Using the Executive's  demographic data, including base salary,
                target  bonus and current  marital  status as of the  Valuation
                Date, provided by the Corporation.

        (d)     Using the Yearly Maximum  Pensionable  Earnings (Y.M.P.E.) used
                to determine the amount of the Canada  Pension Plan Benefit and
                Tax Act maximum  defined benefit pension dollar limit as at the
                Valuation Date.

        (e)     Assuming all Obligations are included.

        (f)     Using  the  actuarial  methods,   assumptions  and  calculation
                methodology described in Schedule "B-2.

        (g)     Applying a load of 15% to the amount  determined  in accordance
                with  subparagraphs  (b)  through (f) of this  Section  10.5 to
                provide  for  fluctuations  in  the  Interest   Discount  Rate,
                Consumer Price Index and other plan experience  during the term
                of the Letter of Credit, as described in Schedule "B-2".


<PAGE>
                                    - 20 -


        (h)     Applying  a load  to  one-half  of  the  amount  determined  in
                accordance with  subparagraphs  (a) through (g) of this Section
                10.5 to provide  for the cost  associated  with the  borrowings
                described  in  subparagraph   (k)  of  this  Section  10.5,  as
                described in Schedule "B-2".

        (i)     Including  a  settlement  expense to the amount  determined  in
                subparagraph  (h),  with  the  aggregate   settlement   expense
                allowance for all  obligations  secured  equal to $250,000,  or
                where  the  Valuation  Date is after  December  31,  2008,  the
                aggregate settlement expense allowance will be increased at the
                rate equal to the  increase in the  Consumer  Price  Index,  as
                described in Schedule "B-2", plus 1% for each year after 2008.

        (j)     Assuming  the  Obligations  will be promptly  settled  with the
                Executive upon  occurrence of a Designated  Event  described in
                Section 1.1(n)(ii).

        (k)     Assuming  a loan will be secured  to permit  settlement  of the
                Obligations prior to receipt of the Refundable Tax Account from
                the Canada Revenue Agency. The assumed interest rate payable on
                the loan shall be as  described  in  Schedule  "B-2".  The cost
                associated with the borrowings shall be assumed to be paid from
                the Trust.

        (l)     The liabilities calculated in accordance with subparagraphs (a)
                through (k) above shall be offset by:

                (i)     the Refundable Tax Account, if any; and

                (ii)    the assets contained in the Trust, if any.

10.6    (a)     If an Executive  Benefit Plan  Obligations  - Designated  Event
                shall occur,  the Corporation  shall be required to immediately
                fund the Executive  Benefit Plan Obligations in accordance with
                the most recent  report  prepared  by the  Actuary  pursuant to
                Section 10.3 of this Restated  Agreement.  Notwithstanding  the
                foregoing,   if  an  Executive   Benefit  Plan   Obligations  -
                Designated Event described in Section 1.1(x)(i) and a Change of
                Control  Obligations  - Designated  Event  described in Section
                1.1(n)(ii) shall occur simultaneously, the Corporation shall be
                required  to settle  the  Executive  Benefit  Plan  Obligations
                forthwith in accordance with the provisions of Schedule "B-1".

        (b)     If:

                (i)     the  employment  of the  Executive is terminated by the
                        Corporation  for any  reason  other than as a result of
                        the death,  disability or retirement of such Executive;
                        and


<PAGE>
                                    - 21 -


                (ii)    such  Executive  files with the  Corporation  a written
                        request  that  it  fund  the  Executive   Benefit  Plan
                        Obligations,

                the  Corporation  shall be  required  to  immediately  fund the
                Executive  Benefit Plan Obligations in accordance with the most
                recent report prepared by the Actuary  pursuant to Section 10.3
                of this Restated Agreement.

        (c)     Upon the earlier of:

                (i)     learning of the occurrence of an Executive Benefit Plan
                        Obligations  -  Designated  Event  described in Section
                        1.1(x)(v) or (vi) of this Restated Agreement; or

                (ii)    receipt  of a written  notice of the  occurrence  of an
                        Executive  Benefit Plan  Obligations - Designated Event
                        described in any of the other  subparagraphs of Section
                        1.1(x) of this  Restated  Agreement,  which  notice has
                        been signed by two executives of the  Corporation,  one
                        of whom must be either the Chief  Financial  Officer or
                        the General Counsel of the Corporation and which notice
                        must,  in  the  case  of  an  Executive   Benefit  Plan
                        Obligations  -  Designated  Event  described in Section
                        1.1(x)(i) of this Restated  Agreement,  indicate  which
                        subparagraph  of the  definition of "Change of Control"
                        is applicable,

                the Trustee shall  promptly give notice to the  Corporation  in
                writing  that it intends to draw on that  portion of the Letter
                of Credit  which is  referable  to the  Executive  Benefit Plan
                Obligations  and  contribute  the  proceeds  thereof  (less any
                applicable  withholding  tax which it will remit as required by
                the Tax Act on  behalf  of the  Corporation)  to the  Trust  on
                behalf  of the  Corporation  in  order  to fund  the  Executive
                Benefit Plan Obligations, unless it receives satisfactory proof
                within nine days of such notice that the Corporation has funded
                or  settled,   as  applicable,   the  Executive   Benefit  Plan
                Obligations  itself  in  accordance  with  the  terms  of  this
                Restated Agreement.

                Unless the  Corporation  advises the Trustee in writing that it
                has funded or settled,  as  applicable,  the Executive  Benefit
                Plan  Obligations in accordance with the terms of this Restated
                Agreement and has provided the Trustee with satisfactory  proof
                thereof  within  nine  days of the  date of the  aforementioned
                notice, the Trustee shall draw on that portion of the Letter of
                Credit  which  is  referable  to  the  Executive  Benefit  Plan
                Obligations  on the tenth day following the date of such notice
                (or the next following  business day if such tenth day is not a
                business  day) and  contribute  the proceeds  thereof (less any
                applicable  withholding  tax which it will remit as required by
                the Tax Act on  behalf  of the  Corporation)  to the  Trust  on
                behalf of the Corporation.


<PAGE>
                                    - 22 -


                Notwithstanding  the  foregoing,  in  the  event  an  Executive
                Benefit  Plan  Obligations  -  Designated  Event  described  in
                Section  1.1(x)(v)  or  (vi)  of this  Restated  Agreement  has
                triggered  the  operation  of this Section 10.6 and the failure
                which gave rise to the  occurrence  of such  Executive  Benefit
                Plan  Obligations - Designated Event has been remedied prior to
                the  expiration  of the  notice  period  provided  for in  this
                Section  10.6(c),   the  Trustee  shall  not  take  the  action
                described in the immediately preceding paragraph hereof and all
                of the provisions of this Restated  Agreement shall continue to
                apply to the same extent and as fully as they would have in the
                event that such Executive Benefit Plan Obligations - Designated
                Event had not occurred.

        (d)     Upon  receipt  of a  written  notice of the  occurrence  of the
                events described in both  subparagraphs (i) and (ii) of Section
                10.6(b)  of this  Restated  Agreement  (which  notice  has been
                signed by the Executive and sworn before a notary public),  the
                Trustee  shall  promptly  give  notice  to the  Corporation  in
                writing  that it intends to draw on that  portion of the Letter
                of Credit  which is  referable  to the  Executive  Benefit Plan
                Obligations  and  contribute  the proceeds (less any applicable
                withholding  tax which it will remit as required by the Tax Act
                on  behalf  of the  Corporation)  to the Trust on behalf of the
                Corporation  in  order  to  fund  the  Executive  Benefit  Plan
                Obligations  unless it receives  satisfactory proof within nine
                days of the date of such notice that the Corporation has funded
                the  Executive  Benefit Plan  Obligations  itself in accordance
                with the terms of this Restated Agreement.

                Unless the  Corporation  advises the Trustee in writing that it
                has funded the Executive Benefit Plan Obligations in accordance
                with  the  terms  hereof  and has  provided  the  Trustee  with
                satisfactory  proof thereof within nine days of the date of the
                aforementioned notice, the Trustee shall draw upon that portion
                of the Letter of Credit  which is  referable  to the  Executive
                Benefit Plan Obligations on the tenth day following the date of
                such notice (or the next  following  business day if such tenth
                day is not a business day) and  contribute  the proceeds  (less
                any applicable  withholding tax which it will remit as required
                by the Tax Act on  behalf of the  Corporation)  to the Trust on
                behalf of the Corporation.

        (e)     For purposes of determining  the required  amount of funding or
                the portion of the Letter of Credit to be drawn on for purposes
                of this  Section  10.6,  the  Trustee  shall  refer to the most
                recent  report  prepared by the  Actuary  for  purposes of this
                Restated  Agreement and, in  particular,  to the portion of the
                report dealing with the Executive Benefit Plan Obligations.  In
                preparing  the  portion  of  its  report  respecting  Executive
                Benefit  Plan  Obligations,  the  Actuary  shall  adhere to the
                following:

                (i)     Assuming  that  the   Executive,   if  then  in  active
                        employment,  will remain in active  employment with the
                        Corporation  as an officer until the  Calculation  Date
                        and   that   the   Executive's   employment   with  the
                        Corporation will terminate on the Calculation Date.


<PAGE>
                                    - 23 -


                (ii)    Using the Executive's  demographic data, including base
                        salary, actual bonus history,  target bonus and current
                        marital  status as of the Valuation  Date,  provided by
                        the Corporation.

                (iii)   Using  the  Canada  Pension  Plan  Benefit  and Tax Act
                        maximum  defined benefit pension dollar limit as at the
                        Valuation Date.

                (iv)    Assuming  the  Executive's   target  bonus   percentage
                        remains  at the  level  specified  by  the  Corporation
                        pursuant to subparagraph (ii) above.

                (v)     Assuming only Executive  Benefit Plan  Obligations  are
                        included.

                (vi)    Assuming the payments under the Executive  Benefit Plan
                        would be made from the Trust.

                (vii)   Using   the   actuarial   methods,    assumptions   and
                        calculation methodology described in Schedule "B-2.

                (viii)  Applying  loads as described  in Schedule  "B-2" to the
                        amount  determined  in  accordance  with the  preceding
                        subparagraphs  of this  Section  10.6(e) to provide for
                        future contingencies and expenses of the Trust.

                (ix)    Calculating the estimated amount required to settle the
                        Executive   Benefit  Plan  Obligations   based  on  the
                        actuarial   methods,    assumptions   and   calculation
                        methodology  described in Schedule "B-2",  increased by
                        the loads described in the following subparagraph.

                (x)     Applying  loads as described  in Schedule  "B-2" to the
                        amount  determined in accordance with subparagraph (ix)
                        to provide for:

                        (A)     fluctuations in the Interest  Discount Rate and
                                Consumer  Price  Index  during  the term of the
                                Letter of Credit; and

                        (B)     the cost associated with the loan to be secured
                                as allowed under the Trust  Agreement to permit
                                settlement  of  the   Executive   Benefit  Plan
                                Obligations  prior to receipt of the Refundable
                                Tax Account from the Canada Revenue Agency. The
                                assumed interest rate payable on the loan shall
                                be as described in Schedule  "B-2" and shall be
                                applied   to   one-half   of  the   amount   in
                                subparagraph (ix). The cost associated with the
                                borrowings shall be assumed to be paid from the
                                Trust.

                (xi)    Taking the larger amount for the Executive of:

                        (A)     the  amount   determined  in  accordance   with
                                subparagraphs (i) through (viii), and


<PAGE>
                                    - 24 -


                        (B)     the  amount   determined  in  accordance   with
                                subparagraphs (ix) and (x).

                (xii)   The amount  determined in accordance with  subparagraph
                        (xi) above shall be offset by:

                        (A)     the Refundable Tax Account, if any;

                        (B)     the assets contained in the Trust, if any.

        (f)     In the event that the Executive  Benefit Plan  Obligations have
                been funded in accordance with the terms hereof as a result of:

                (i)     the Corporation making an assignment for the benefit of
                        creditors  or  filing  a  petition  in   bankruptcy  or
                        becoming insolvent or bankrupt;

                (ii)    a  receiver,  trustee  or  liquidator  of  or  for  the
                        Corporation  being  appointed and not being  discharged
                        within a period of sixty days;

                (iii)   a voluntary  dissolution or wind-up of the Corporation;
                        or

                (iv)    a sale or  disposition of all or  substantially  all of
                        the assets of the Corporation,

                and  the  Executive   Benefit  Plan  has  been   terminated  in
                connection  therewith,  the Executive  Benefit Plan Obligations
                shall be promptly  settled by the Trustee with the Executive by
                way of a lump sum payment from the Trust. For this purpose, the
                benefit  entitlements  of each Executive shall be determined by
                the  Actuary  in  accordance  with the  terms of the  Executive
                Benefit  Plan and the amount of the lump sum  payment  shall be
                determined  by the Actuary using the  assumptions  set forth in
                Schedule "B-1".  Notice of termination of the Executive Benefit
                Plan  shall be  provided  to the  Trustee  by the  Corporation,
                failing which by two executives of the Corporation, one of whom
                must be  either  the Chief  Financial  Officer  or the  General
                Counsel of the Corporation.

                Any assets of the Trust  remaining  after full  satisfaction of
                (i) the  Executive  Benefit  Plan  Obligations  pursuant to the
                preceding paragraph and (ii) any further  obligations  pursuant
                to the terms of the Trust  Agreement,  shall be returned to the
                Corporation.

        (g)     In the event the Executive  Benefit Plan shall be terminated at
                any  time  either  in  whole  or in  part  in  relation  to the
                Executive  subsequent to the funding of the  Executive  Benefit
                Plan  Obligations  in accordance  with the terms hereof,  then,
                provided  Section  10.6(f) of this  Restated  Agreement  is not
                otherwise  applicable,  the Executive  Benefit Plan Obligations
                shall be promptly  settled by the Trustee with the Executive by
                way of a lump sum payment from the Trust.


<PAGE>
                                    - 25 -


                For this  purpose,  the benefit  entitlements  of the Executive
                shall be determined by the Actuary in accordance with the terms
                of the  Executive  Benefit  Plan and the amount of the lump sum
                payment   shall  be   determined   by  the  Actuary  using  the
                assumptions  set  forth  in  Schedule  "B-1".   Notice  of  the
                termination of the Executive  Benefit Plan shall be provided to
                the Trustee by the Corporation, failing which by two executives
                of the  Corporation,  one of whom  must  be  either  the  Chief
                Financial Officer or the General Counsel of the Corporation.

                Any assets of the Trust  remaining  after full  satisfaction of
                (i) the Executive Benefit Plan Obligations and (ii) any further
                obligations pursuant to the terms of the Trust Agreement, shall
                be returned to the Corporation.

        (h)     In the event:

                (i)     of a dispute  as to  whether a payment to or in respect
                        of the  Executive is properly due and payable  pursuant
                        to the Executive Benefit Plan; and

                (ii)    such dispute cannot be resolved by the parties  thereto
                        within the time frame  specified in Section  1.1(x)(vi)
                        of this Restated Agreement,

                the amount in dispute  shall be  remitted  to the  Trustee  for
                deposit to the Trust. Upon final settlement of the dispute, the
                amount so deposited  (together  with any earnings,  profits and
                increments  thereon  and  after  deduction  of  any  authorized
                payments  allocable  thereto,  both as determined in accordance
                with the terms of the  Trust  Agreement),  less any  applicable
                withholding  tax which will be  remitted as required by the Tax
                Act,  shall be paid to that party to the dispute which is found
                to be entitled thereto.  Prior to such amount being paid out of
                the Trust in accordance with the terms hereof,  the Corporation
                shall  instruct  the Actuary to take such  amount into  account
                when  preparing  its  report  for  purposes  of  this  Restated
                Agreement.

        (i)     In the event that a Change of Control  Obligations - Designated
                Event   described  in  Section   1.1(n)(ii)  of  this  Restated
                Agreement  shall  occur   subsequent  to  the  funding  of  the
                Executive Benefit Plan Obligations in accordance with the terms
                of this Restated  Agreement,  the Corporation shall be required
                to settle the Executive  Benefit Plan Obligations  forthwith in
                an amount  determined  by the  Actuary in  accordance  with the
                provisions of Schedule "B-1".

        (j)     Subject  to  Section  10.6(f),  10.6(g)  and  10.6(i)  of  this
                Restated  Agreement,  in the event that the  Executive  Benefit
                Plan  Obligations have been funded in accordance with the terms
                hereof,  all  or a  portion  of  such  Executive  Benefit  Plan
                Obligations  may,  at the  discretion  of the  Corporation,  be
                promptly settled with the Executive.


<PAGE>
                                    - 26 -


                For this  purpose,  the benefit  entitlements  of the Executive
                shall be determined by the Actuary in accordance with the terms
                of the  Executive  Benefit  Plan.  In such  circumstances,  the
                Corporation  reserves the right to settle the Executive Benefit
                Plan  Obligations by way of a lump sum payment to the Executive
                provided  that the amount of each such payment is determined by
                the Actuary in  accordance  with the  assumptions  set forth in
                Schedule "B-1".

10.7    (a)     If a Change of Control Obligations - Designated Event described
                in Section  1.1(n)(i) of this Restated  Agreement  shall occur,
                the  Corporation  shall be  required  to  immediately  fund the
                Change  of  Control  Obligations  in  accordance  with the most
                recent report prepared by the Actuary  pursuant to Section 10.3
                of this Restated Agreement.

        (b)     If a Change of Control Obligations - Designated Event described
                in Section  1.1(n)(ii) of this Restated  Agreement shall occur,
                the  Corporation  shall be  required  to settle  the  Change of
                Control Obligations forthwith in accordance with the provisions
                of Schedule "B-1", upon receipt by the Corporation of a Release
                executed by the Executive in the form attached to this Restated
                Agreement as Schedule "A".

        (c)     Upon the earlier of:

                (i)     learning  of the  occurrence  of a  Change  of  Control
                        Obligations  -  Designated  Event  described in Section
                        1.1(n)(i) of this Restated Agreement; or

                (ii)    receipt  of a  written  notice of the  occurrence  of a
                        Change  of  Control   Obligations  -  Designated  Event
                        described  in  Section   1.1(n)(ii)  of  this  Restated
                        Agreement,   which   notice  has  been  signed  by  the
                        Executive  and  sworn  before a notary  public  and has
                        annexed thereto a Release  executed by the Executive in
                        the  form  attached  to  this  Restated   Agreement  as
                        Schedule "A",

                the Trustee shall  promptly give notice to the  Corporation  in
                writing  that it intends to draw on that  portion of the Letter
                of  Credit   which  is  referable  to  the  Change  of  Control
                Obligations  and  contribute  the  proceeds  thereof  (less any
                applicable  withholding  tax which it will remit as required by
                the Tax Act on  behalf  of the  Corporation)  to the  Trust  on
                behalf  of the  Corporation  in  order to fund  the  Change  of
                Control  Obligations,  unless it  receives  satisfactory  proof
                within nine days of such notice that the Corporation has funded
                or settled,  as applicable,  the Change of Control  Obligations
                itself in accordance with the terms of this Restated Agreement.

                Unless the  Corporation  advises the Trustee in writing that it
                has funded or  settled,  as  applicable,  the Change of Control
                Obligations  in  accordance  with the  terms  of this  Restated
                Agreement and has provided the Trustee with satisfactory  proof
                thereof  within  nine  days of the  date of the  aforementioned
                notice, the Trustee shall draw on that portion of the Letter of
                Credit which is referable to the Change of Control  Obligations
                on the tenth day following the date of such notice (or the next
                following business day if such tenth day is not a business day)
                and contribute  the proceeds  (less any applicable  withholding
                tax which it will remit as required by the Tax Act on behalf of
                the Corporation) to the Trust on behalf of the Corporation.


<PAGE>
                                    - 27 -


                Notwithstanding the foregoing, in the event a Change of Control
                Obligations - Designated  Event described in Section  1.1(n)(i)
                of this Restated  Agreement has triggered the operation of this
                Section 10.7 and the failure which gave rise to the  occurrence
                of such Change of Control  Obligations  - Designated  Event has
                been  remedied  prior to the  expiration  of the notice  period
                provided for in this  Section  10.7(c),  the Trustee  shall not
                take  the  action   described  in  the  immediately   preceding
                paragraph  hereof and all of the  provisions  of this  Restated
                Agreement  shall  continue  to apply to the same  extent and as
                fully as they  would  have in the  event  that  such  Change of
                Control Obligations - Designated Event had not occurred.

        (d)     The required  amount of funding or the portion of the Letter of
                Credit to be drawn on for  purposes of this  Section 10.7 shall
                be determined by the Actuary and shall be the amount determined
                in  accordance  with  Sections  10.5(a)  through  (l)  of  this
                Restated   Agreement   offset  by  the  amount   determined  in
                accordance with subparagraphs  10.6(e)(i) through (xii) of this
                Restated Agreement.  The settlement amount for purposes of this
                Section  10.7  shall  be  determined  in  accordance  with  the
                provisions of Schedule "B-1".

        (e)     In the event that the Change of Control  Obligations  have been
                funded in  accordance  with the terms hereof as a result of the
                occurrence  of a Change of  Control  Obligations  -  Designated
                Event  described in Section  1.1(n)(ii),  the Change of Control
                Obligations  shall be promptly  settled  with the  Executive in
                accordance with the provisions of Schedule "B-1".

10.8    The actuarial  methods and assumptions  described in Schedule "B-1" and
        Schedule  "B-2" shall be reviewed from time to time.  Any amendments to
        Schedule  "B-1" and/or  Schedule "B-2" as a result of such review shall
        be dealt with in accordance with Section 12.6.

10.9    The Trustee shall surrender the Letter of Credit to the Corporation for
        cancellation upon the earliest of:

        (a)     receipt  by the  Trustee of a written  direction  signed by the
                Corporation and the Executive directing surrender of the Letter
                of Credit;

        (b)     receipt  by the  Trustee of a written  direction  signed by the
                Corporation  confirming  that it has funded and/or  settled the
                Obligations in accordance with the terms hereof,  together with
                evidence which is satisfactory to the Trustee that such funding
                and/or settlement has occurred; and


<PAGE>
                                    - 28 -


        (c)     receipt  by the  Trustee of a written  direction  signed by the
                Corporation  confirming  that the  Corporation has no remaining
                Obligations to the  Executive,  together with evidence which is
                satisfactory  to  the  Trustee  that  the  Corporation  has  no
                remaining  Obligations to the Executive and that a copy of such
                written direction has been provided to the Executive.

10.10   The Trust shall be terminated by the Trustee upon the earliest of:

        (a)     receipt  by the  Trustee of a written  direction  signed by the
                Corporation and the Executive confirming the termination of the
                Trust;

        (b)     the entire depletion of the Trust Fund through payments pursuant
                to the terms of the  Trust  Agreement,  in the  event  that such
                depletion occurs subsequent to the funding of the Obligations in
                accordance with the terms of this Restated Agreement; and

        (c)     receipt  by the  Trustee of a written  direction  signed by the
                Corporation  confirming  that the  Corporation has no remaining
                Obligations to the  Executive,  together with evidence which is
                satisfactory  to  the  Trustee  that  a copy  of  such  written
                direction has been provided to the Executive.

         Upon the  termination  of the  Trust,  any  assets of the Trust  which
         remain after the  satisfaction  of any  remaining  Obligations  of the
         Corporation to the Executive shall be returned to the Corporation.

10.11   The  Corporation  and  the  Executive   hereby   acknowledge  that  the
        Corporation  is  entering  into  agreements  similar  to this  Restated
        Agreement with certain of its other executives and that the Corporation
        may, at its sole discretion,  arrange for one or more Letters of Credit
        to satisfy its responsibilities  under this Restated Agreement and such
        other agreements. In the event that one Letter of Credit is obtained to
        satisfy  the   Corporation's   responsibilities   under  this  Restated
        Agreement  and some or all of such other  agreements,  references  to a
        "Letter  of  Credit"  in  this  Restated  Agreement  shall  be  read as
        references  to that portion of such Letter of Credit which is referable
        to the responsibilities of the Corporation to the Executive.

        The Corporation and the Executive also acknowledge that the Corporation
        may, at its sole discretion, enter into one or more Trust Agreements to
        satisfy its  responsibilities  under this  Restated  Agreement and such
        other agreements. In the event that one Trust Agreement is entered into
        to satisfy  the  Corporation's  responsibilities  under  this  Restated
        Agreement  and  some or all of such  other  agreements,  references  to
        "Trust",  "Trust Agreement",  "Trustee" and "Refundable Tax Account" in
        this Restated Agreement shall be read with such modifications as may be
        necessary in the context.

10.12   At the discretion of the  Corporation  and subject to the provisions of
        applicable  law, in the event that all or a portion of the  Obligations
        are  funded in  accordance  with  Article  10 hereof  and an  actuarial
        surplus (determined by actuarial valuation in accordance with the terms
        of the report prepared as at the immediately  preceding  Valuation Date
        in accordance with Section 10.3 of this Restated Agreement) arises as a
        result thereof:


<PAGE>
                                    - 29 -


        (a)     all or a portion of such  actuarial  surplus may be used in the
                determination of or to reduce the funding otherwise required to
                be provided by the Corporation hereunder; or

        (b)     any surplus  assets may, to the extent that they exceed 110% of
                the amount  required  to fund that  portion of the  Obligations
                which has been funded (as determined by the report  prepared as
                at the immediately  preceding Valuation Date in accordance with
                Section  10.3 of this  Restated  Agreement)  be returned to the
                Corporation.


                                  ARTICLE 11
                             EXPEDITED ARBITRATION
                             ---------------------

11.1    If, pursuant to Section 6.1 of this Restated  Agreement,  the Executive
        provides  written notice of the Executive's  intention to terminate the
        Executive's  employment for Good Reason,  and the Corporation  believes
        that  there is no Good  Reason,  or,  alternatively,  if,  pursuant  to
        Section  4.1 of  this  Restated  Agreement,  the  Corporation  provides
        written notice of its intention to terminate the Executive's employment
        for Just Cause and the Executive  believes there is no Just Cause,  the
        Corporation or the Executive,  as  applicable,  shall,  within ten (10)
        days of having  been  provided  such  notice,  provide  written  notice
        ("Notice  of   Dispute")  to  the  other  Party  of  the  dispute  (the
        "Dispute").

11.2    The Parties agree that any and all Disputes  under Section 11.1 of this
        Restated Agreement will be resolved by way of a single Arbitrator.

11.3    (a)     Within fifteen (15) days of provision of the Notice of Dispute,
                the Parties  shall agree upon and appoint a neutral  Arbitrator
                from  the  then  current  roster   maintained  by  the  Alberta
                Mediation and  Arbitration  Society to act as Arbitrator of the
                Dispute; or

        (b)     If no person  acceptable  to both  Parties has been agreed upon
                and appointed  within fifteen (15) days,  then either Party may
                make  immediate  application  to the Court of Queen's  Bench of
                Alberta,  Judicial  District of Calgary,  to have an Arbitrator
                appointed.

11.4    The Parties  acknowledge  and agree that the purpose of this Article 11
        is to avoid delays and facilitate  resolution of the Dispute in a just,
        speedy and cost-effective manner.

11.5    Consistent  with the expedited  nature of  arbitration,  the Arbitrator
        will  direct  and  control  the scope and  timing  of the  exchange  of
        information  between  the  Parties  and  will  take  such  steps as the
        Arbitrator deems necessary to achieve a just, speedy and cost-effective
        resolution of the Dispute.  The Arbitrator has the exclusive  right and
        power to resolve all issues  related to the exchange of  information in
        the arbitration process.


<PAGE>
                                    - 30 -


11.6    The Parties agree that the  Arbitrator is only  authorized to determine
        whether the Executive had Good Reason for  terminating  the Executive's
        employment, or alternatively, whether the Corporation had Just Cause to
        terminate the Executive's employment.

11.7    A hearing will occur within  forty-five (45) days of the appointment of
        the Arbitrator (the  "Hearing").  The time of the Hearing (the "Hearing
        Date") will be scheduled by the Arbitrator after  consultation with the
        Parties.  The  Hearing  will be  governed  by the  rules set out in the
        Arbitration Act S.A. 1991, c.A-43, as modified by the Arbitrator in the
        interests of achieving a just, speedy and cost-effective  resolution of
        the Dispute.  The Arbitrator may require written submissions of fact in
        the Dispute to be provided seven (7) days before the Hearing Date.

11.8    The  Arbitrator  will use best  efforts to  provide a written  decision
        within seven (7) days of the conclusion of the Hearing.

11.9    The Parties agree that the decision of the Arbitrator will be final and
        binding upon the Parties.

                                  ARTICLE 12
                                    GENERAL
                                    -------

12.1    The headings of the Articles and paragraphs in this Restated  Agreement
        are inserted for  convenience  only and shall not affect the meaning or
        construction of this Restated Agreement.

12.2    This  Restated   Agreement   shall  be  construed  and  interpreted  in
        accordance  with the laws of the  Province  of Alberta  and the federal
        laws of Canada as applicable therein.

12.3    If any provision of this Restated Agreement is determined to be void or
        unenforceable  in  whole or in part,  it shall be and be  deemed  to be
        severed from this Restated Agreement without affecting or impairing the
        validity of any other provision herein.

12.4    Any notice  required  or  permitted  to be given  under  this  Restated
        Agreement  shall be in writing and shall be properly given if delivered
        by hand  delivery  or mail or other  form of  electronic  communication
        capable of transmission confirmation to the following address:

        a.   IN THE CASE OF THE CORPORATION TO:

             Nexen Inc.
             801 - 7th Avenue S.W.
             Calgary, AB T2P 3P7
             Attention: General Manager, Compensation and Benefits


<PAGE>
                                    - 31 -


        b.   IN THE CASE OF THE EXECUTIVE TO:

             the  last  address  of  the   Executive  in  the  records  of  the
             Corporation  or to such other address as the Parties may from time
             to time specify by notice given in accordance herewith.

12.5    This  Restated  Agreement  shall enure to the benefit of and be binding
        upon  the  Executive   and  the   Executive's   heirs,   executors  and
        administrators and upon the Corporation and its successors and assigns.

12.6    This Restated  Agreement  constitutes the entire agreement  relating to
        the  respective   rights  and  obligations  of  the  Parties  upon  the
        occurrence  of a Change  of  Control.  No  amendment  or waiver of this
        Restated  Agreement  shall be binding unless executed in writing by the
        Parties.

         Notwithstanding the foregoing,

        (a)     any  amendment  to  Article  10  of  this  Restated  Agreement,
                Schedule  "B-1" or  Schedule  "B-2" which is required to ensure
                that the balance  remaining in the Trust after the required tax
                has been withheld and remitted to the Canada  Revenue Agency is
                sufficient  to satisfy the fee levied by the Bank in connection
                with the  issuance  of a Letter  of  Credit  may be made by the
                Corporation   without  the  prior   written   approval  of  the
                Executive; and

        (b)     the Corporation  may amend,  modify or waive Article 10 of this
                Restated Agreement,  Schedule "B-1" and Schedule "B-2" in whole
                or in part,  at such  time and from  time to time,  and in such
                manner  and to such  extent  as it may deem  advisable  without
                obtaining  the approval of the  Executive,  provided  that such
                amendment, modification or waiver, as the case may be, does not
                adversely  affect the  securitization  in  accordance  with the
                terms hereof of those  Obligations which have accrued up to the
                date of such amendment, modification or waiver, as the case may
                be.

12.7    The Parties agree that the rights, entitlements and benefits set out in
        this Restated  Agreement to be paid to the  Executive  upon a Change of
        Control  shall be in full  satisfaction  of all rights of the Executive
        under applicable law in effect from time to time as a result thereof.

12.8    Neither  Party can waive or shall be deemed to have waived any right it
        has under this Restated Agreement except to the extent that such waiver
        is in writing.

12.9    Nothing  contained  in this  Restated  Agreement  shall be construed as
        limiting the ability of the  Corporation to amend,  modify or terminate
        the  Executive  Benefit Plan in whole or in part, at such time and from
        time to time,  and in such  manner  and to such  extent  as it may deem
        advisable.


<PAGE>
                                    - 32 -


The Parties have  executed  this  Restated  Agreement  effective the date first
written above.


                                         NEXEN INC.


                                         Per: (signed)
                                              --------------------------------


                                         Per: (signed)
                                              --------------------------------


SIGNED, SEALED & DELIVERED
in the presence of


(signed)                                (signed)
-----------------------------           ---------------------------------------
WITNESS                                 GARY NIEUWENBURG


<PAGE>


                                  SCHEDULE "A"
                                  ------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                      EXECUTIVE BENEFIT PLAN ENTITLEMENTS

In order to  receive  the  entitlements  referred  to in the  Article 7 of this
Restated  Agreement,  the Executive shall execute the attached  Release,  fully
releasing  the  Corporation   from  all  further  claims  in  relation  to  the
Executive's  employment or Employment Benefits and the termination thereof upon
payment  of the  remuneration  and  benefits  referred  to in Article 7 of this
Restated Agreement.  The attached Release shall not, however,  require that the
Executive  relinquish  or release any rights to indemnity  which the  Executive
may,  as an officer or director of the  Corporation  or any of its  Affiliates,
Associates  and  Subsidiaries,  have as against the  Corporation  or any of its
Affiliates,  Associates  and  Subsidiaries,  for costs,  charges  and  expenses
reasonably  incurred  by the  Executive  in respect of any civil,  criminal  or
administrative  action or  proceeding to which the Executive is made a party by
reason of being or having been a director or officer of the  Corporation or any
of its Affiliates, Associates and Subsidiaries, where:

        (a)     the Executive has acted  honestly and in good faith with a view
                to  the  best  interests  of  the  Corporation  or  any  of its
                Affiliates, Associates and Subsidiaries; and

        (b)     in  the  case  of  a  criminal  or  administrative   action  or
                proceeding  enforced by a monetary  penalty,  the Executive had
                reasonable  grounds for believing the  Executive's  conduct was
                lawful.





<PAGE>

                                 FINAL RELEASE
                                 -------------


KNOW  ALL MEN BY  THESE  PRESENTS  that I,  GARY  NIEUWENBURG,  of the  City of
Calgary,  in the Province of Alberta,  in consideration of the amounts provided
in that certain Amended and Restated Agreement Respecting Change of Control and
Executive Benefit Plan Entitlements (the "Restated  Agreement") dated as of the
______ day of  ____________,  2008 between  myself and NEXEN INC. and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged,  do for myself,  my executors and assigns hereby remise,  release
and  forever  discharge  the  Corporation,  and  any  associated,   affiliated,
predecessor  or parent  corporation  of the  Corporation  and their present and
former directors,  officers, agents and employees (the "Releasees"),  including
each of their respective  successors,  heirs,  administrators and assigns, from
all manner of actions, causes of action, debts, obligations,  covenants, claims
or demands,  whatsoever  which I may ever have had, now have, or can,  shall or
may  hereafter  have  against  the  Releasees  or any of them,  by reason of or
arising  out of any  cause,  matter  or thing  whatsoever  done,  occurring  or
existing up to and  including the present date and, in  particular,  without in
any way restricting  the generality of the foregoing,  in respect of all claims
of any nature  whatsoever,  past,  present or future,  directly  or  indirectly
related to or arising out of or in  connection  with my  relationship  with the
Releasees,  as an employee,  officer or  director,  and the  termination  of my
employment  from the  Corporation  including,  but not  limited  to, any claims
related to any  entitlement  I may have or may have had to any payment or claim
either at common law or under the  Employment  Standards  Code,  Human  Rights,
Citizenship  and  Multiculturalism  Act or  any  other  applicable  legislation
governing or related to my employment with the Releasees.

AND FOR THE SAID CONSIDERATION, I, GARY NIEUWENBURG, represent and warrant that
I have not  assigned to any person,  firm or  corporation  any of the  actions,
causes of action, claims, suits,  executions or demands which I release by this
Release,  or with  respect  to which I agree  not to make any claim or take any
proceeding herein.


<PAGE>
                                     - 2 -


IT IS FURTHER  ACKNOWLEDGED  that the payment to me includes full  compensation
and  consideration for the loss of my employment  benefits,  as provided by the
Releasees, and that all of my employment benefits and privileges shall cease on
the  date of  termination  of my  employment,  except  as  otherwise  expressly
provided in the Restated Agreement.  I further acknowledge that I have received
all benefits due to me and have no further claim against the Releasees for such
benefits. I further accept sole responsibility to replace such benefits which I
wish to continue or to exercise  conversion  privileges  where  applicable with
respect to such benefits and, in  particular  any life  insurance and long-term
disability benefits.  In the event that I become disabled following termination
of my  employment,  I covenant not to sue the  Releasees for insurance or other
benefits  or loss of same and hereby  release  the  Releasees  from any and all
further obligations or liabilities arising therefrom.

Notwithstanding  anything contained herein, this Release shall not extend to or
affect,  or constitute a release of, my right to sue,  claim against or recover
from the  Releasees  and shall not  constitute  an  agreement  to refrain  from
bringing, taking or maintaining any action against the Releasees in respect of:

        (a)     any  corporate  indemnity  existing  by  statute,  contract  or
                pursuant to any of the constating  documents of the Corporation
                provided in my favour in respect of my having acted at any time
                as a director, officer or both of the Corporation;

        (b)     my entitlement  to any insurance  maintained for the benefit or
                protection of the directors and/or officers of the Corporation,
                including   without   limitation,   directors'   and  officers'
                liability insurance; or

        (c)     my entitlement to any amounts or  compensation  due to me under
                the terms of my employment pursuant to the Restated Agreement.


<PAGE>
                                     - 3 -


IT IS  HEREBY  AGREED  that the  terms of the  Restated  Agreement  and of this
Release will be kept  confidential.  No party hereto shall communicate any such
terms to any third  party under any  circumstances  whatsoever,  excepting  any
necessary  communication with my legal and financial advisors,  as required, on
the express condition that they maintain the confidentiality  thereof,  and any
disclosure which is required by law,  although either party shall be at liberty
to  disclose to third  parties  that a mutually  acceptable  Release was agreed
upon.  The  invalidity  and  unenforceability  of any provision of this Release
shall not affect the validity or  enforceability of any other provision of this
Release, which shall remain in full force and effect.

I HEREBY  DECLARE that I have read all of this Release,  fully  understand  the
terms of this Release and voluntarily accept the consideration stated herein as
the sole  consideration  for this  Release for the purpose of making a full and
final settlement with the Releasees.  I further  acknowledge and confirm that I
have been given an adequate period of time to obtain  independent legal counsel
regarding  the  meaning  and  the  significance  of the  terms  herein  and the
covenants mutually exchanged.

IT IS HEREBY AGREED THAT as a term of the termination of my employment from the
Corporation, and in consideration of the amount noted above, I hereby resign as
officer and director of the Corporation and its affiliates.

IN  WITNESS  WHEREOF,  I have  hereunto  set my hand and seal this _____ day of
______________ in the year _________.



--------------------------------
GARY NIEUWENBURG



--------------------------------
WITNESS (signature)



--------------------------------
WITNESS (print name)



<PAGE>

                                 SCHEDULE "B-1"
                                 --------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                      EXECUTIVE BENEFIT PLAN ENTITLEMENTS
          METHODOLOGY AND ASSUMPTIONS FOR DETERMINING SETTLEMENT VALUE


PURPOSE

In  accordance  with the terms of the Restated  Agreement,  the purpose of this
Schedule "B-1" is to outline the calculation  approach such that, after tax has
been paid on a lump sum settlement  value, the remaining balance is intended to
be sufficient to provide after-tax monthly payments equivalent to the after-tax
monthly  payments  the  Executive  would have  received  under the terms of the
Executive Benefit Plan as provided for under this Restated Agreement.


OVERVIEW FOR DEFINED BENEFIT PENSION

The  following  outlines the actuarial  methods,  assumptions  and  calculation
process to be used in determining the lump sum settlement  value of the defined
benefit pension  entitlements  under the Executive Benefit Plan when settlement
occurs in accordance with Section 10 of the Restated Agreement.  Section 300 of
the Income Tax  Regulations  establishes  the procedure  applicable in using an
after-tax lump sum to purchase a prescribed annuity:

1.   A prescribed  annuity payment  consists of two components:  (a) the deemed
     capital element of the annuity payment on which no tax is payable, and (b)
     the deemed  non-capital  portion of the annuity  payment which is taxed at
     the marginal rate.

2.   The capital  portion of each future annuity  payment is considered to be a
     return of the original after-tax lump sum amount.

3.   The non-capital  portion of each annuity payment is assumed to be provided
     by the investment return on the original after-tax lump sum amount and has
     therefore not yet been taxed.

4.   A constant  percentage of each future  payment is deemed to be a return of
     the original lump sum capital.

CALCULATION METHODOLOGY

1.   Equivalent after-tax payments:

a.   Determine  initial gross annual  pension  entitlement  under the Executive
     Benefit Plan.

b.   Determine after-tax annual pension entitlement under the Executive Benefit
     Plan based on Individual Tax Rate as defined in Schedule "B-1".


<PAGE>
                                     - 2 -


c.   Determine the capital  element based on the  non-indexed  present value of
     the pension payments divided by life expectancy.

d.   Determine the monthly payment which provides an after-tax pension equal to
     the  after-tax  pension  determined in 1.b.  above in accordance  with the
     prescribed annuity methodology.

2.   Present value of periodic payments from 1. above:

a.   Determine the present value of the pension  determined in 1.d. above using
     the  assumptions  described  below in this  Schedule  "B-1".  For  greater
     certainty, the value of the post-retirement  indexation is to be reflected
     in  determining  the present value of the accrued  pension  entitlement in
     respect  of  post-1992  service,  and any  accrued  pension  in respect of
     service granted during the Severance Period.

3.   Tax adjustment:

a.   Gross-up the present  value  determined  in 2.a.  above to reflect the tax
     assumed to be required to be paid on the lump sum.

b.   Gross-up the amount determined in 3.a. above to reflect the tax assumed to
     be required to be paid on  investment  earnings in respect of the lump sum
     payment during the deferral period prior to assumed pension  commencement,
     if any.

4.   Equivalent present value after tax as the after-tax monthly payments:

a.   The amount determined in 3.b. above shall be the lump sum settlement value
     of the Executive's pension entitlement.

ASSUMPTIONS

Interest Discount Rate:

--  during deferral period                 Yield  on  long-term  Government  of
                                           Canada  bonds  as  published  in the
                                           Bank of Canada Review,  described in
                                           CANSIM   series    V122544   (or   a
                                           successor   series)   for  the  last
                                           trading  Wednesday at the end of the
                                           month immediately preceding the date
                                           of calculation, rounded down to next
                                           lower 0.5.

--  after assumed pension commencement     Yield  on  long-term  Government  of
                                           Canada  bonds  as  published  in the
                                           Bank of Canada Review,  described in
                                           CANSIM   series    V122544   (or   a
                                           successor   series)   for  the  last
                                           trading  Wednesday at the end of the
                                           month immediately preceding the date
                                           of calculation, rounded down to next
                                           lower 0.5,

                                           less


<PAGE>
                                     - 3 -


                                           assumed escalation of pensions after
                                           retirement.

Increase in Consumer Price Index:          Yield  on  long-term  Government  of
                                           Canada  bonds  as  published  in the
                                           Bank of Canada Review,  described in
                                           CANSIM   series    V122544   (or   a
                                           successor   series)   for  the  last
                                           trading  Wednesday at the end of the
                                           month immediately preceding the date
                                           of calculation,

                                           less

                                           Yield  on  long-term  Government  of
                                           Canada   Real   Return    bonds   as
                                           published  in  the  Bank  of  Canada
                                           Review,  described in CANSIM  series
                                           V122553 (or a successor  series) for
                                           the last  trading  Wednesday  at the
                                           end   of   the   month   immediately
                                           preceding the date of calculation.

                                           The result of the difference is then
                                           rounded up to the next  highest 0.5%.

Escalation of Pensions After Retirement:   75%  of  CPI,   less   1%   (minimum
                                           increase  25% of CPI).  Applies only
                                           to  benefits   accrued  for  service
                                           after December 31, 1992.

Mortality:

--  for life expectancy                    1994 Uninsured  Pensioner  Mortality
                                           Table  with  mortality  improvements
                                           projected  to 15  years  beyond  the
                                           date of termination.

--  for present values

        o  prior to assumed pension        Nil.
           commencement


        o  after assumed pension           1994 Uninsured  Pensioner  Mortality
           commencement                    Table  with  mortality  improvements
                                           projected  15 years  beyond the date
                                           of termination.

Marital Status:                            Actual    status    at    date    of
                                           termination.

Age of Spouse:                             Based on actual date of birth.


<PAGE>
                                     - 4 -


Individual Tax Rate:                       Maximum individual marginal tax rate
                                           for    employee's     province    of
                                           employment    at   the    date    of
                                           termination.


OVERVIEW FOR DEFINED CONTRIBUTION BENEFIT

The Settlement  Value for any defined  contribution  benefits shall be equal to
the DC Supplemental Company Account the Executive would have received under the
terms of the  Executive  Benefit  Plan as  provided  for  under  this  Restated
Agreement. The Settlement Value will not be adjusted for tax.


ASSUMPTIONS

Investment return:                         As the Settlement  Value is expected
                                           to be  payable  at  the  calculation
                                           date no investment return is assumed
                                           to  accrue  on the  DC  Supplemental
                                           Company  Account  as  defined in the
                                           Executive Benefit Plan.




<PAGE>


                                 SCHEDULE "B-2"
                                 --------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                      EXECUTIVE BENEFIT PLAN ENTITLEMENTS

METHODOLOGY  AND ASSUMPTIONS FOR DETERMINING THE AMOUNT TO BE SECURED OR FUNDED
IN ACCORDANCE  WITH SECTION 10 BASED ON THE  METHODOLOGY  DESCRIBED IN SCHEDULE
"B-1"


PURPOSE

The purpose of this Schedule "B-2" is to provide the actuarial  methodology and
assumptions  for  determining  the amount to be secured or funded in accordance
with Section 10 of the Restated Agreement.

METHODOLOGY

The settlement methodology is described in Schedule B-1.

The funding methodology applicable to the Executive Benefit Plan Obligations is
based on the following:

1.   Estimate the accrued pension and/or Supplemental  Company Accounts payable
     from the Executive Benefit Plan as at the Valuation Date.

2.   Assume  that  the  assets  of the  plan are to be  invested  in long  term
     Government  of  Canada  bonds  and  subject  to  the  50%  refundable  tax
     applicable to retirement compensation arrangements.

3.   DC Supplemental  Company  Accounts are assumed to be paid as a lump sum as
     at the Valuation Date with no adjustment for tax.

4.   Determine the present value of the amounts in 1 through 3 above.

5.   Estimate the  settlement  value that could be paid in accordance  with the
     methodology and assumptions described in Schedule B-1.

6.   The funding  amount in respect of the Executive  Benefit Plan  Obligations
     shall be the greater of the amount determined in accordance with 1 through
     4 above and the amount in 5 above.

ASSUMPTIONS

Interest Discount Rate:

--  during deferral period                 Yield  on  long-term  Government  of
                                           Canada  bonds  as  published  in the
                                           Bank of Canada Review,  described in
                                           CANSIM   series    V122544   (or   a
                                           successor   series)   for  the  last
                                           trading  Wednesday at the end of the
                                           month   immediately   preceding  the
                                           Anniversary  Date,  rounded  down to
                                           next lower 0.5.


<PAGE>
                                     - 2 -


--  after assumed pension commencement     Yield  on  long-term  Government  of
                                           Canada  bonds  as  published  in the
                                           Bank of Canada Review,  described in
                                           CANSIM   series    V122544   (or   a
                                           successor   series)   for  the  last
                                           trading  Wednesday at the end of the
                                           month   immediately   preceding  the
                                           Anniversary  Date,  rounded  down to
                                           next   lower  0.5  ,  less   assumed
                                           escalation    of   pensions    after
                                           retirement.

Increase in Consumer Price Index:          Yield  on  long-term  Government  of
                                           Canada  bonds  as  published  in the
                                           Bank of Canada Review,  described in
                                           CANSIM   series    V122544   (or   a
                                           successor   series)   for  the  last
                                           trading  Wednesday at the end of the
                                           month   immediately   preceding  the
                                           Anniversary Date,

                                           less

                                           Yield  on  long-term  Government  of
                                           Canada   Real   Return    bonds   as
                                           published  in  the  Bank  of  Canada
                                           Review,  described in CANSIM  series
                                           V122553 (or a successor  series) for
                                           the last  trading  Wednesday  at the
                                           end   of   the   month   immediately
                                           preceding the Anniversary Date.

                                           The result of the difference is then
                                           rounded up to the next highest 0.5%.

Escalation of Pensions After Retirement:   75%  of  CPI,   less   1%   (minimum
                                           increase  25% of CPI).  Applies only
                                           to  benefits   accrued  for  service
                                           after December 31, 1992.

Mortality:

-- for life expectancy                     1994 Uninsured  Pensioner  Mortality
                                           Table  with  mortality  improvements
                                           projected  to 15  years  beyond  the
                                           Calculation Date.

-- for present values

        o  prior to assumed pension        Nil.
           commencement


<PAGE>
                                     - 3 -


        o  after assumed pension           1994 Uninsured  Pensioner  Mortality
           commencement                    Table  with  mortality  improvements
                                           projected   15  years   beyond   the
                                           Calculation Date.

Marital Status:                            Actual status at the Anniversary.

Age of Spouse:                             Based on actual date of birth.

Individual Tax Rate:                       Maximum individual marginal tax rate
                                           for    employee's     province    of
                                           employment at the Anniversary Date

Bonus:                                     Target bonus % applied to the salary
                                           rate at the Valuation Date

Investment return:                         Yield  on  long-term  Government  of
                                           Canada  bonds  as  published  in the
                                           Bank of Canada Review,  described in
                                           CANSIM   series    V122544   (or   a
                                           successor   series)   for  the  last
                                           trading  Wednesday at the end of the
                                           month   immediately   preceding  the
                                           Anniversary  Date  rounded  down  to
                                           next lower 0.5%, and then divided by
                                           2

Assumed  investment  return on             As  published  in the Bank of Canada
DC Supplemental Company Account            Review,  described in CANSIM  series
as at the Valuation Date:                  V122544 (or a successor  series) for
                                           the last  trading  Wednesday  at the
                                           end   of   the   month   immediately
                                           preceding   the   Anniversary   Date
                                           rounded  up to  next  highest  0.5%,
                                           plus 3.0%

Decrements:                                None  assumed  prior to  Calculation
                                           Date

Eligibility for Pensions:                  100% vested

Pension Commencement Age:
--   eligible for subsidized early         Payable  at  the  completion  of the
     retirement on the Calculation Date    Severance  Period.  Payable  at  the
     (i.e., age 55 and 10 years of         Calculation  Date  for  purposes  of
     continuous service)                   determining   the  amount   required
                                           under Section  10.6(e).

--   not eligible for early retirement on  Deferred to age 60 or the end of the
     the Calculation Date                  Severance  Period if later.  Payable
                                           at   age   60   for    purposes   of
                                           determining   the  amount   required
                                           under Section 10.6(e).

Fluctuation reserve (1)                    15% of the pension obligations


<PAGE>
                                     - 4 -


Cost of borrowing to settle the            Yield  on one  month  Government  of
obligations:                               Canada  Treasury  Bills as published
                                           in  the  Bank  of   Canada   Review,
                                           described in CANSIM  series  V122529
                                           (or a successor series) for the last
                                           trading  Wednesday at the end of the
                                           month   immediately   preceding  the
                                           Anniversary Date,  rounded up to the
                                           next higher 0.25%, plus 1.50%


================================================================================
NOTES:

(1)  Referred to by Section 10.5(g), Section 10.6(e)(viii) and 10.6(e)(x).  The
     15% load is intended to provide a reserve for a potential  decrease in the
     Interest  Discount Rate in  combination  with  potential  increases in the
     Consumer Price Index for an aggregate change of 1.0%.


<PAGE>

                                  SCHEDULE "C"
                                  ------------

          AMENDED AND RESTATED AGREEMENT RESPECTING CHANGE OF CONTROL
                    AND EXECUTIVE BENEFIT PLAN ENTITLEMENTS
                   ESTIMATED(1) ENTITLEMENT TO COMPENSATION
                PURSUANT TO ARTICLE 7 OF THE RESTATED AGREEMENT

--------------------------------------------------------------------------------
EMPLOYEE - GARY NIEUWENBURG
--------------------------------------------------------------------------------
Base Salary                                                            $844,000
--------------------------------------------------------------------------------
Bonus Target Value                                                     $379,800
--------------------------------------------------------------------------------
Benefits Uplift                                                        $109,720
--------------------------------------------------------------------------------
Car Allowance                                                           $38,400
--------------------------------------------------------------------------------
Savings Plan                                                            $50,640
--------------------------------------------------------------------------------
Financial Counselling Services                                          $10,500
--------------------------------------------------------------------------------
Security Monitoring Services                                             $2,400
--------------------------------------------------------------------------------
TOTAL VALUE                                                          $1,435,460
--------------------------------------------------------------------------------
ADDITIONAL LUMP SUM SETTLEMENT VALUE OF PENSION(2)                   $1,480,303
--------------------------------------------------------------------------------
TOTAL ESTIMATED ENTITLEMENT                                          $2,915,763
--------------------------------------------------------------------------------

In addition to the above, Section 7.1(d) of the Restated Agreement provides for
Executive  Outplacement  counselling  to be provided by a firm  selected by the
Executive, at a cost to the Corporation not to exceed $25,000.

IN ADDITION to the above pension entitlement under the Agreement, the Executive
has the following  pension  entitlements  under the Defined Benefit  Registered
Pension Plan and Executive  Benefit Plan. As is the case with the figures shown
above,  these  values  are  estimated  values (as of April 1, 2008) and are for
illustrative  purposes only. Actual values will be calculated as of the date of
the entitlement or payment in accordance  with the Defined  Benefit  Registered
Pension Plan and the Executive Benefit Plan, respectively, and therefore may be
subject to change.  Pension entitlements in respect of the Defined Contribution
Registered Pension Plan and the Defined Contribution provision of the Executive
Benefit Plan are not included in the pension amounts presented below.

o  Accrued Annual Defined Benefit Pension Entitlement
   (Registered Pension Plan)(3)                                          $7,583

o  Estimated Lump Sum Transfer Value of Registered Pension Plan(4)      $78,826

o  Estimated Lump Sum Value of Executive Benefit Plan(4)               $878,582


---------

(1)  As stated in Section 7.1 of the Restated Agreement, the above calculations
     represent  only the current  estimated  value (as of April 1, 2008) of the
     Executive's   entitlement  to  compensation  upon  a  Change  of  Control.
     Accordingly, the above calculations are for illustrative purposes only.

(2)  Calculated in accordance with Section 7.1(b) of the Restated Agreement.

     - Adjustment to EBP lump sum value to reflect settlement $702,533.

     - Additional  settlement  value of pension  accrued  during the  severance
     period upon a change of control $777,770.

(3)  Deferred benefit payable from age 60.

(4)  Based on the Standards of Practice for Determining Pension Commuted Values
     approved by the Canadian Institute of Actuaries using rates applicable for
     April 2008 terminations.


<PAGE>


                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                      EXECUTIVE BENEFIT PLAN ENTITLEMENTS

This amended and restated agreement  respecting change of control and executive
benefit plan entitlements made as of the 4th day of September, 2008.


BETWEEN:

                   NEXEN INC., a corporation incorporated under the laws
                   of Canada
                                  (hereinafter referred to as the "Corporation")

                            - and -

                   TIMOTHY THOMAS

                                  (hereinafter referred to as the "Executive")

RECITALS:

1.       The Executive,  as Senior Vice President,  Canadian Oil and Gas of the
         Corporation, is considered by the Board to be an essential officer and
         employee of the Corporation, who is both integral to the operation and
         development of the Corporation,  and has acquired  outstanding skills,
         unique  experience  and  possesses  an  extensive  background  in, and
         knowledge of, the Corporation's business,  operations and the industry
         in which it is engaged.

2.       In the event of a Change of Control,  there is a possibility  that the
         employment of the Executive would be terminated  without just cause or
         adversely  modified and the Executive  has  expressed  concern in that
         regard to the Corporation.

3.       The Board recognizes that it is essential and in the best interests of
         the Corporation and its shareholders  that the Corporation  retain the
         continued  dedication of the Executive to the  Executive's  office and
         the  Executive's  employment  during the  uncertain  period  prior to,
         during and following a Change of Control.

4.       The Board further  believes that the past service of the Executive and
         the Executive's  integral role in the development and operation of the
         Corporation  requires that the Corporation ensure that in the event of
         a Change of Control the Executive is treated in a manner that is fair,
         reasonable,  consistent  with  industry  standards  and  in  the  best
         interests of the Corporation.

5.       The  Corporation  and the  Executive  entered into a Change of Control
         Agreement on November 1, 2007 (the  "Original  Agreement") to agree on

<PAGE>
                                     - 2 -


         the terms  and  conditions  which  would  govern  the  termination  or
         modification of the employment of the Executive  following a Change of
         Control.

6.       The  Original  Agreement  was amended by an Amending  Agreement  dated
         November  27,  2007 (the  "Amending  Agreement")  which,  among  other
         matters,  detailed the Corporation's  security and funding obligations
         in  respect  of the  Change of  Control  Obligations  (as  hereinafter
         defined), provided for the securitization and funding of the Executive
         Benefit Plan Obligations (as hereinafter defined) and provided for the
         cessation of the  Executive's  coverage under the Statement of Company
         Procedure   Regarding  the   Securitization  of  Nexen  Inc.  Restated
         Executive  Benefit Plan, as amended or replaced from time to time (the
         "Securitization Procedure").

7.       The Corporation and the Executive wish to amend the Original Agreement
         and the Amending  Agreement as herein  provided and, in doing so, wish
         to  restate  those   agreements  as  herein   amended  (the  "Restated
         Agreement").

NOW  THEREFORE,  in  consideration  of the mutual  covenants and agreements set
forth in this Restated Agreement and for other good and valuable consideration,
the receipt and  sufficiency of which are hereby  acknowledged  by the Parties,
the Parties agree as follows:


                                   ARTICLE 1
                                  DEFINITIONS
                                  -----------

1.1      In this Restated Agreement, the following terms shall mean as follows:

         (a)    "ACTING  JOINTLY  OR IN  CONCERT"  for  the  purposes  of  this
                Restated  Agreement,  a Person is acting  jointly or in concert
                with  another   Person  if  such  Person  has  any   agreement,
                arrangement or  understanding  (whether  formal or informal and
                whether  or not in  writing)  with such  other  Person  for the
                purpose of acquiring, offering to acquire, or voting any Common
                Shares of the Corporation (other than customary agreements with
                and between  underwriters  and banking  group or selling  group
                members with respect to a distribution  of securities by way of
                prospectus  or private  placement  or  pursuant  to a pledge of
                securities in the ordinary course of business).

         (b)    "ACTUARY"  has the meaning  referred to in Section 10.2 of this
                Restated Agreement.

         (c)    "AFFILIATE" and "ASSOCIATE"  have the meaning  ascribed to such
                terms in National Instrument 45-106.

         (d)    "ANNIVERSARY  DATE" has the meaning referred to in Section 10.3
                of this Restated Agreement.

         (e)    "ANNUAL  BASE  SALARY"  means  the  annual  base  salary of the
                Executive  payable by the  Corporation  at the end of the month
                immediately preceding the Date of Termination.


<PAGE>
                                     - 3 -


         (f)    "ANNUAL TARGET BONUS" means the Executive's annual target bonus
                as  determined  by the Board to be in effect  for the  calendar
                year in which a Change of Control occurs.

         (g)    "BANK" has the  meaning  referred  to in  Section  10.2 of this
                Restated Agreement.

         (h)    "BENEFICIAL OWNER" for the purposes of this Restated Agreement,
                a Person  shall be deemed to be the  "BENEFICIAL  OWNER" and to
                have "BENEFICIAL OWNERSHIP" of and to "BENEFICIALLY OWN":

               (i)    any  securities  as to which  such  Person or any of such
                      Person's  Affiliates or Associates is the owner at law or
                      in equity;

               (ii)   any  securities  as to which  such  Person or any of such
                      Person's  Affiliates or Associates has a right to acquire
                      (i) upon the exercise of any  Convertible  Securities  or
                      (ii)   pursuant   to  any   agreement,   arrangement   or
                      understanding,   whether   such   right  is   exercisable
                      immediately within a period of sixty (60) days thereafter
                      and whether or not on condition  or the  happening of any
                      contingency,  (other than (a) customary  agreements  with
                      and between  underwriters  and banking  group and selling
                      group  members  with respect to the  distribution  to the
                      public or pursuant to a private  placement of securities,
                      or (b) pursuant to a pledge of securities in the ordinary
                      course of business); and

               (iii)  any securities  which are  Beneficially  Owned within the
                      meaning of clauses  (a) or (b) above by any other  Person
                      with which such Person is Acting Jointly or in Concert,

         provided,  however,  that a Person shall not be deemed the "Beneficial
         Owner" or to have "Beneficial  Ownership" of or to "Beneficially  Own"
         any security where such Person is the registered  holder of securities
         as a result of carrying on the  business of or acting as nominee for a
         securities depository.

         For purposes of this  Restated  Agreement,  the  percentage  of Common
         Shares Beneficially Owned by any Person,  shall be and be deemed to be
         the product determined by the formula:

         100 x A/B

         Where:

                      A =   the  number  of  votes  for  the  election  of  all
                            directors  generally attaching to the Common Shares
                            Beneficially Owned by such Person; and

                      B =   the  number  of  votes  for  the  election  of  all
                            directors  generally  attaching to all  outstanding
                            Common Shares.


<PAGE>
                                     - 4 -

                For the  purposes  of the  foregoing  formula,  where a  Person
                Beneficially  Owns unissued Common Shares which may be acquired
                pursuant to Convertible Securities, such Common Shares shall be
                deemed to be  outstanding  for the purpose of  calculating  the
                percentage of Common Shares  Beneficially  Owned by such Person
                in  both  the  numerator  and  the  denominator,  but no  other
                unissued  Common  Shares which may be acquired  pursuant to any
                other  outstanding   Convertible   Securities  shall,  for  the
                purposes of that calculation, be deemed to be outstanding.

         (i)    "BOARD"  means the Board of  Directors  of the  Corporation  as
                constituted from time to time.

         (j)    "CBCA" means the CANADA BUSINESS  CORPORATIONS  ACT, as amended
                from time to time, and any successor legislation thereto.

         (k)    "CALCULATION  DATE" has the meaning referred to in Section 10.5
                of this Restated Agreement.

         (l)    "CHANGE OF CONTROL" means the occurrence of any of:

                (i)    the  purchase  or  acquisition  of any Common  Shares or
                       Convertible  Securities  by  a  Beneficial  Owner  which
                       results in the  Beneficial  Owner owning,  or exercising
                       control or direction over,  Common Shares or Convertible
                       Securities  such that,  assuming only the  conversion of
                       Convertible Securities  Beneficially Owned or over which
                       control or  direction  is  exercised  by the  Beneficial
                       Owner,  the  Beneficial  Owner  would own,  or  exercise
                       control or direction  over,  Common Shares  carrying the
                       right to cast more than thirty-five percent (35%) of the
                       votes attaching to all Common Shares; or

                (ii)   the  substantial  completion  of:  (i) the  liquidation,
                       dissolution  or winding-up of the  Corporation;  or (ii)
                       the  sale,   lease  or  other   disposition  of  all  or
                       substantially all of the assets of the Corporation; or

                (iii)  a situation in which individuals who were members of the
                       Board immediately prior to:

                       (A)   a meeting of the  shareholders  of the Corporation
                             involving  a contest  for,  or an item of business
                             relating to, the election of directors; or

                       (B)   an  amalgamation,  arrangement,  merger  or  other
                             consolidation  or combination  of the  Corporation
                             with another Person,

                       shall not  constitute a majority of the Board  following
                       such election or transaction; or


<PAGE>
                                     - 5 -


                (iv)   the  completion  of any  transaction  or the  first of a
                       series  of  transactions  which  would  have the same or
                       similar   effect  as  any   transaction   or  series  of
                       transactions  referred  to in  paragraphs  (i),  (ii) or
                       (iii) above; or

                (v)    a  determination  by the Board that, for the purposes of
                       this  Restated  Agreement,   a  Change  of  Control  has
                       occurred or is imminent.

         (m)    "CHANGE OF CONTROL OBLIGATIONS" means the Company's obligations
                to make the lump sum payments  described in Section 7.1 of this
                Restated Agreement to the Executive.

         (n)    A "CHANGE OF CONTROL  OBLIGATIONS - DESIGNATED  EVENT" shall be
                deemed to have occurred if:

                (i)    the  Corporation  fails to arrange for the  extension or
                       replacement of a Letter of Credit in accordance with the
                       terms of this Restated Agreement; or

                (ii)   the  Executive's  employment is terminated in accordance
                       with Section 5.1 or 6.1 of this Restated Agreement.

         (o)    "COMMON SHARES" means the common shares of the Corporation.

         (p)    "CONVERTIBLE SECURITIES" means:

                (i)    any right  (contractual  or otherwise and  regardless of
                       whether such right constitutes a security) to acquire
                      Common Shares from the Corporation; or

                (ii)   any security issued by the Corporation from time to time
                       (other   than   the   rights   issued   pursuant   to  a
                       shareholders'  rights  protection plan, if any) carrying
                       any exercise, conversion or exchange right,

                which is then  exercisable  or  exercisable  within a period of
                sixty  (60) days from that time  pursuant  to which the  holder
                thereof may acquire Common Shares or other securities which are
                convertible  into or  exercisable  or  exchangeable  for Common
                Shares (in each case, whether such right is then exercisable or
                exercisable  within a period of sixty  (60) days from that time
                and  whether  or  not on  condition  or  the  happening  of any
                contingency).

         (q)    "DATE OF TERMINATION" means the date upon which the Executive's
                employment is terminated pursuant to Section 4.1, 5.1 or 6.1 of
                this  Restated  Agreement.  For  greater  clarity,  the Date of
                Termination means the date upon which the Corporation  provides
                the  Executive  with  written,  verbal or other notice that the
                Executive's  employment has been or will be terminated pursuant
                to Section 4.1 or 5.1 of this  Restated  Agreement  or the date
                upon which the Executive  provides the Corporation with written
                notice  terminating  the  Executive's  employment  pursuant  to
                Section 4.1 or for Good Reason pursuant to Section 6.1.


<PAGE>
                                     - 6 -


         (r)    "DISABILITY"   means,   where  due  to  a  physical  or  mental
                condition,  the Executive is rendered  totally and  permanently
                unable to perform  the  Executive's  duties  for a  consecutive
                period of two (2) years or more during which the  Executive has
                been in receipt of long term disability insurance benefits from
                the insurance carrier normally utilized by the Corporation.

         (s)    "DISPUTE"  has the meaning  referred to in Section 11.1 of this
                Restated Agreement.

         (t)    "EFFECTIVE  DATE" means the date upon which a Change of Control
                occurs.

         (u)    "EMPLOYMENT  BENEFITS"  means the employment  benefits to which
                the  Executive  is entitled by virtue of any  written,  oral or
                implied  agreement  with the  Corporation.  For the purposes of
                this Restated Agreement,  "Employment  Benefits" shall include,
                but is not limited to, the following:

                (i)    the  Executive's  entitlement  to any  dental or general
                       medical care;

                (ii)   the   Executive's   entitlement  to  receive  long  term
                       disability  benefits from the insurance carrier normally
                       utilized by the Corporation;

                (iii)  the  Executive's  entitlement to pension  benefits under
                       the terms of any pension plan with the Corporation;

                (iv)   the  Executive's  entitlement to a monthly car allowance
                       from the Corporation;

                (v)    the  Executive's  entitlement  to  contributions  by the
                       Corporation to the Corporation's savings plan;

                (vi)   the   Executive's   entitlement   to  receive  from  the
                       Corporation  financial counseling services, at a cost of
                       $3,500.00 per year (or as the same may be increased from
                       time to time by the Corporation); and

                (vii)  the   Executive's   entitlement   to  receive  from  the
                       Corporation   security   monitoring   services   at  the
                       Executive's personal residence.

         (v)    "EXECUTIVE BENEFIT PLAN" has the meaning referred to in Section
                7.1(b) of this Restated Agreement.

         (w)    "EXECUTIVE  BENEFIT PLAN  OBLIGATIONS"  means the Corporation's
                outstanding obligations under the Executive Benefit Plan to the
                Executive.

         (x)    An  "EXECUTIVE  BENEFIT PLAN  OBLIGATIONS  - DESIGNATED  EVENT"
                shall be deemed to have occurred if:

                (i)    a Change of Control occurs;


<PAGE>
                                     - 7 -


                (ii)   the  Corporation  makes an assignment for the benefit of
                       creditors or files a petition in  bankruptcy  or becomes
                       insolvent or bankrupt;

                (iii)  a  receiver,   trustee  or  liquidator  of  or  for  the
                       Corporation is appointed and is not discharged  within a
                       period of sixty days;

                (iv)   the  net  worth  of  the   Corporation,   described   as
                       shareholder   equity  in  the   consolidated   financial
                       statements of the Corporation as disclosed in the annual
                       and quarterly  consolidated  financial statements of the
                       Corporation, is less than $400 million;

                (v)    the  Corporation  fails to arrange for the  extension or
                       replacement of a Letter of Credit in accordance with the
                       terms of this Restated Agreement;

                (vi)   the Executive has provided  written  notification to the
                       Trustee  and to the  Corporation  of the  failure by the
                       Corporation  to pay any amount  owed to or in respect of
                       the Executive  under the  Executive  Benefit Plan within
                       thirty days of the due date  specified in the  Executive
                       Benefit  Plan  (together  with a statement of the amount
                       due and  owing)  either to the person  entitled  thereto
                       pursuant to the  Executive  Benefit Plan or to the Trust
                       in accordance with the provisions of Section 10.6(h); or

                (vii)  at any time the Board adopts a resolution  to the effect
                       that,  for  purposes  of  this  Restated  Agreement,  an
                       Executive  Benefit Plan  Obligations - Designated  Event
                       has occurred or is imminent.

         (y)    "GOOD REASON" means any of the following,  unless the Executive
                shall  have  given  the  Executive's  express  written  consent
                thereto:

                (i)    INCONSISTENT  DUTIES. The assignment to the Executive of
                       any duties  inconsistent with the Executive's  status as
                       an executive  officer of the  Corporation  or a material
                       alteration  in the  nature or status of the  Executive's
                       responsibilities  or  duties or  reporting  relationship
                       from  those in effect  immediately  prior to a Change of
                       Control;

                (ii)   REDUCED  SALARY.  A reduction by the  Corporation in the
                       Executive's   Annual   Base  Salary  in  effect  on  the
                       Effective   Date  or  as  the  same  may  be   increased
                       thereafter  from  time  to time  or the  failure  by the
                       Corporation to grant the Executive salary increases at a
                       rate commensurate  with the increases  accorded to other
                       executives of the Corporation;

                (iii)  RELOCATION.  The Corporation  requiring the Executive to
                       be based  anywhere  other  than where the  Executive  is
                       based at the time a Change of Control occurs, except for
                       required  travel  on the  Corporation's  business  to an
                       extent  substantially  consistent  with the  Executive's

<PAGE>
                                    - 8 -


                       business  travel  obligations in the ordinary  course of
                       business immediately prior to a Change of Control;

                (iv)   INCENTIVE   COMPENSATION   PLANS.  The  failure  by  the
                       Corporation   to  continue   in  effect  any   incentive
                       compensation  plan in which the Executive  participates,
                       including,   but   not   limited   to,   the   Incentive
                       Compensation  Plan or the Stock Option Plan or any other
                       similar  plans  adopted  prior to a Change  of  Control,
                       unless the Executive is eligible to participate  in, and
                       is entitled to the  opportunity  to receive a comparable
                       level of  benefits  under,  an  ongoing,  substitute  or
                       alternative plan (it being understood that the manner or
                       method of payment and the form of consideration need not
                       be the same as existed in the  original  plans);  or the
                       failure by the  Corporation to continue the  Executive's
                       participation therein on at least as favourable a basis,
                       both in terms of the amount of benefits available to the
                       Executive and the level of the Executive's participation
                       relative to other participants, as existed at the time a
                       Change of Control occurs;

                (v)    EMPLOYMENT BENEFITS AND PERQUISITES.  The failure by the
                       Corporation  to continue to provide the  Executive  with
                       Employment  Benefits  at  least as  favourable  as those
                       enjoyed by the Executive  immediately  prior to a Change
                       of Control,  including any pension plan, benefit plan or
                       any   retirement   arrangement   established   for   the
                       Executive,  or any of the Corporation's  life insurance,
                       medical,  health  and  accident,  disability  or savings
                       plans in which the  Executive was  participating  at the
                       time a Change  of  Control  occurs;  the  taking  of any
                       action  by  the  Corporation   that  would  directly  or
                       indirectly   materially  reduce  any  such  benefits  or
                       deprive the Executive of any material perquisite enjoyed
                       by the Executive at the time a Change of Control occurs,
                       including,   without   limitation   and  to  the  extent
                       applicable,  the  use  of a car,  aircraft,  secretarial
                       services, office space, telephones, computer facilities,
                       expense  reimbursement,   financial   counselling,   and
                       professional  fees and club dues  reimbursement;  or the
                       failure by the Corporation to provide the Executive with
                       the number of paid  vacation days to which the Executive
                       is entitled in accordance with the Corporation's  normal
                       vacation  practice  in  effect  at the time a Change  of
                       Control occurs;

                (vi)   NO  ASSUMPTION   BY   SUCCESSOR.   The  failure  of  the
                       Corporation  to obtain a  satisfactory  agreement from a
                       successor to assume and agree to perform  this  Restated
                       Agreement. Alternatively, if the business or undertaking
                       in connection  with which the  Executive's  services are
                       principally performed is sold at any time after a Change
                       of Control  occurs,  and the  Executive's  employment is
                       transferred  as a result,  the failure or refusal of the
                       purchaser of such business or undertaking to provide the
                       Executive  with  the  same  or  a  comparable  position,
                       duties,  compensation  and  benefits,  as  described  in
                       paragraphs  (iv)  and  (v)  above,  as  provided  to the

<PAGE>
                                    - 9 -


                       Executive  by the  Corporation  immediately  prior  to a
                       Change of Control;

                (vii)  DISPOSITION   OF  "ALL  OR   SUBSTANTIALLY   ALL".   The
                       disposition by the  Corporation of all or  substantially
                       all of the assets of the  Corporation,  as  contemplated
                       herein,  notwithstanding  that the Executive's  services
                       were  or  were  not   principally   performed  for  such
                       business.

         (z)    "HEARING"  has the meaning  referred to in Section 11.7 of this
                Restated Agreement.

         (aa)   "HEARING  DATE" has the meaning  referred to in Section 11.7 of
                this Restated Agreement.

         (bb)   "INCENTIVE  COMPENSATION  PLAN"  means any  bonus or  incentive
                compensation  plan of the Corporation in which the Executive is
                entitled to receive benefits in the month immediately preceding
                a Change of Control.

         (cc)   "JUST CAUSE" means:

                (i)    the failure by the  Executive to  substantially  perform
                       the  Executive's  duties  according  to the terms of the
                       Executive's employment in existence immediately prior to
                       a Change of Control after the  Corporation has given the
                       Executive  reasonable  notice  of  such  failure  and  a
                       reasonable opportunity to correct it; or

                (ii)   where  the  Executive  engages  in any  criminal  act or
                       dishonesty resulting or intended to result,  directly or
                       indirectly, in the personal gain of the Executive at the
                       Corporation's expense.

         (dd)   "LETTER OF CREDIT" has the meaning  referred to in Section 10.2
                of this Restated Agreement.

         (ee)   "MONTHLY BASE SALARY" means the monthly  salary  payable to the
                Executive by the  Corporation in effect at the end of the month
                immediately preceding the Effective Date.

         (ff)   "NOTICE OF DISPUTE" has the meaning referred to in Section 11.1
                of this Restated Agreement.

         (gg)   "OBLIGATIONS"  means,  collectively,   the  Change  of  Control
                Obligations and the Executive Benefit Plan Obligations.

         (hh)   "PARTIES"  means  the  Corporation,   and  its  successors  and
                permitted assigns, and the Executive and the Executive's heirs,
                executors  and  administrators  and "PARTY" means either one of
                them.


<PAGE>
                                     - 10 -


         (ii)   "PERSON" includes an individual, partnership, association, body
                corporate,    trustee,    executor,    administrator,     legal
                representative and any national, provincial, state or municipal
                government or any agency thereof.

         (jj)   "REFUNDABLE  TAX  ACCOUNT"  means the  refundable  tax  account
                maintained  in  respect  of the  Trust  by the  Canada  Revenue
                Agency.

         (kk)   "REGISTERED  PENSION  PLAN"  has  the  meaning  referred  to in
                Section 7.1(b) of this Restated Agreement.

         (ll)   "RESTATED  AGREEMENT" means this amended and restated agreement
                respecting   change  of  control  and  executive  benefit  plan
                entitlements  as it may be amended,  restated  or  supplemented
                from  time to time,  and the  expressions  "hereof",  "herein",
                "hereto", "hereunder",  "hereby", and similar expressions refer
                to this Restated  Agreement and,  unless  otherwise  indicated,
                refer to Articles or Sections in this Restated Agreement only.

         (mm)   "SECURITIZATION  PROCEDURE" has the meaning  referred to in the
                recitals of this Restated Agreement.

         (nn)   "SEVERANCE  PERIOD"  means the  twenty-four  (24) month  period
                immediately following the Date of Termination.

         (oo)   "STOCK OPTION PLAN" means any stock option plan or plans of the
                Corporation  pursuant to which the Executive is granted options
                by the Corporation to acquire Common Shares.

         (pp)   "SUBSIDIARY" has the meaning ascribed to it in the CBCA.

         (qq)   "TAX ACT" means the Income Tax Act (Canada) and the Regulations
                thereunder, both as amended from time to time.

         (rr)   "TERM"  has the  meaning  referred  to in  Section  3.1 of this
                Restated Agreement.

         (ss)   "TRUST"  has the meaning  referred  to in Section  10.1 of this
                Restated Agreement.

         (tt)   "TRUST  AGREEMENT" has the meaning  referred to in Section 10.1
                of this Restated Agreement.

         (uu)   "TRUSTEE"  means CIBC Mellon Trust  Company or such other trust
                company  duly  incorporated  under  the laws of  Canada  or any
                province  thereof whom the Company may designate as the trustee
                in connection with the security and funding of the Obligations.

         (vv)   "VALUATION DATE" has the meaning referred to in Section 10.3 of
                this Restated Agreement.


<PAGE>
                                    - 11 -


                                   ARTICLE 2
                          SCOPE OF RESTATED AGREEMENT
                          ---------------------------

2.1      The Parties  intend that this  Restated  Agreement  sets out (a) their
         respective  rights and obligations  upon the occurrence of a Change of
         Control and in connection with the  securitization  and funding of the
         Change of Control  Obligations;  and (b) their  respective  rights and
         obligations  regarding the securitization and funding of the Executive
         Benefit Plan Obligations. This Restated Agreement does not provide for
         any other terms of the Executive's  employment  with the  Corporation,
         except as expressly provided for herein.

2.2      The Parties hereby confirm that except as otherwise  expressly  stated
         in this Restated Agreement,  insofar as the securitization and funding
         of the Executive  Benefit Plan Obligations is concerned,  the terms of
         this   Restated   Agreement   shall   govern  and  the  terms  of  the
         Securitization Procedure shall not be applicable.

2.3      This Restated Agreement shall  automatically  terminate upon the death
         of the Executive or where due to the Disability of the Executive,  the
         Executive is materially  incapacitated from performing the Executive's
         duties. In the event of the death or Disability of the Executive,  the
         Executive  (or the  Executive's  estate)  shall be entitled to receive
         from  the  Corporation  all  unpaid  Annual  Base  Salary,  Employment
         Benefits, unpaid business expenses and vacation entitlement accrued to
         the date of the death or  Disability of the  Executive.  The Executive
         (or the Executive's  estate) shall also be entitled to receive any and
         all death or Disability  benefits in a manner  consistent with, and at
         least equal in amount to, those provided by the  Corporation to senior
         executives  (or their estate) under such plans,  programs and policies
         in effect at the date of Disability or death of the Executive, and the
         Corporation shall have no further  obligations to the Executive or the
         Executive's estate under this Restated Agreement.  Any entitlements of
         the Executive (or the Executive's  estate) under the Executive Benefit
         Plan which remain following the termination of this Restated Agreement
         pursuant to this Section 2.3 shall then  commence to be covered  under
         the Securitization Procedure.

2.4      If the Executive's  employment is terminated by either Party,  for any
         reason,  prior  to a Change  of  Control  in any  manner,  other  than
         expressly  provided  for in this  Restated  Agreement,  this  Restated
         Agreement shall automatically terminate and the Corporation shall have
         no further  obligations  to the  Executive  hereunder.  Any  remaining
         entitlements of the Executive  under the Executive  Benefit Plan which
         remain following the termination of this Restated  Agreement  pursuant
         to this  Section  2.4 shall  then  commence  to be  covered  under the
         Securitization Procedure.


                                   ARTICLE 3
                           TERM OF RESTATED AGREEMENT
                           --------------------------

3.1      Subject to termination of this Restated Agreement prior to a Change of
         Control,  this Restated  Agreement shall remain in effect for a period
         concluding  twelve  (12)  months  following  the  Effective  Date (the
         "Term"),  at which  time  this  Restated  Agreement  shall  terminate;
         provided  however that the payment of compensation and benefits to the

<PAGE>
                                    - 12 -


         Executive under this Restated  Agreement shall continue beyond the end
         of the Term in  accordance  with  the  applicable  provisions  of this
         Restated Agreement.  Any remaining entitlements of the Executive under
         the Executive  Benefit Plan which remain  following the termination of
         this  Restated  Agreement  pursuant  to this  Section  3.1 shall  then
         commence to be covered under the Securitization Procedure.


                                   ARTICLE 4
            TERMINATION FOR JUST CAUSE OR FOR OTHER THAN GOOD REASON
            --------------------------------------------------------

4.1      If the  Executive's  employment  is terminated  for Just Cause,  or is
         terminated by the Executive,  other than for Good Reason,  following a
         Change of Control, the Corporation shall pay to the Executive,  if not
         already paid,  the fraction of the unpaid  Annual Base Salary  accrued
         during the then current  fiscal year of the  Corporation,  all accrued
         Employment  Benefits,  all unpaid reasonable business expenses and all
         unpaid   vacation  pay  accrued  up  to  and  including  the  Date  of
         Termination,  and thereafter,  the  Corporation  shall have no further
         obligations to the Executive under this Restated Agreement.

4.2      Nothing in this  Restated  Agreement  shall serve to derogate from the
         vested rights of the Executive to pension benefits, Stock Option Plans
         or any other Employment Benefits to which the Executive is entitled up
         to the Date of Termination.


                                   ARTICLE 5
                           TERMINATION BY CORPORATION
                           --------------------------

5.1      If the Executive's  employment is terminated by the Corporation within
         the twelve (12) month period  following the Effective Date, for reason
         other than Just Cause, death or Disability,  the Corporation shall pay
         to the  Executive  the  remuneration  referred to in Article 7 of this
         Restated Agreement.


                                   ARTICLE 6
                          TERMINATION FOR GOOD REASON
                          ---------------------------

6.1      In the event of a Change of Control,  the  Executive  may,  within the
         twelve  (12)  month  period  following  the  Effective  Date  and upon
         providing the Corporation with ten (10) days written notice, terminate
         the Executive's  employment with the Corporation for Good Reason. Upon
         being  provided  with such notice,  the  Corporation  shall pay to the
         Executive the  remuneration  referred to in Article 7 of this Restated
         Agreement.

                                   ARTICLE 7
                         COMPENSATION UPON TERMINATION

7.1      If the Executive's employment is terminated in accordance with Section
         5.1 or 6.1 of this Restated Agreement:


<PAGE>
                                    - 13 -


         (a)    the Corporation  shall  forthwith,  but in any event within ten
                (10) days from receipt by the Corporation of a Release executed
                by the Executive substantially in the form of Schedule "A", pay
                to the Executive:

                (i)    if not previously  paid, that portion of the Executive's
                       accrued but unpaid Monthly Base Salary,  any accrued but
                       unpaid bonus to which the  Executive is entitled for the
                       preceding calendar year under any Incentive Compensation
                       Plan, all unpaid  reasonable  business  expenses and all
                       accrued but unused vacation pay earned or payable to the
                       Executive  by the  Corporation  for the period  from the
                       beginning of the Corporation's then current fiscal year,
                       up to and including the Date of Termination;

                (ii)   a lump sum cash payment equal to the Executive's Monthly
                       Base Salary and  one-twelfth  (1/12) of the  Executive's
                       Annual  Target  Bonus  for each  month of the  Severance
                       Period;

                (iii)  a lump sum payment  equal to thirteen  percent  (13%) of
                       the  Executive's  Annual Base  Salary for the  Severance
                       Period  representing  the value of the group  health and
                       welfare benefits for the Severance Period;

                (iv)   a  lump  sum  payment  representing  the  value  of  the
                       Executive's  monthly  car  allowance  for the  Severance
                       Period;

                (v)    a  lump  sum  payment  representing  the  value  of  the
                       Corporation's contributions to the Corporation's savings
                       plan (at a rate of six percent  (6%) of the  Executive's
                       Annual Base Salary) for the Severance Period;

                (vi)   a  lump  sum  payment  representing  the  value  of  the
                       Executive's  entitlement to receive from the Corporation
                       financial  counseling services for the Severance Period;
                       and

                (vii)  a  lump  sum  payment  representing  the  value  of  the
                       Executive's  entitlement to receive from the Corporation
                       security monitoring services at the Executive's personal
                       residence for the Severance Period;

         (b)    with respect to the Executive's entitlement to pension benefits
                under the Pension  Plan for  Employees  of Nexen Inc.  (Defined
                Benefit Option) (the  "Registered  Pension Plan"),  if any, and
                the  Executive's  related  entitlement  under  the  Nexen  Inc.
                Restated Executive Benefit Plan (the "Executive Benefit Plan"),
                if any:

                (i)    the Corporation shall recognize the Severance Period for
                       purposes of determining the Executive's entitlement;

                (ii)   for calculation purposes, the Executive's entitlement is
                       the benefit  which would have been  determined  assuming
                       that the  Executive  had been  employed  throughout  the
                       Severance Period, including recognition of:


<PAGE>
                                    - 14 -


                       (A)   additional  service that would have been  credited
                             for the Severance Period;

                       (B)   monthly  salary equal to the  Executive's  Monthly
                             Base Salary throughout the Severance Period;

                       (C)   pensionable  bonus  for the  year  of the  Date of
                             Termination,  and  for  each  subsequent  year  or
                             portion  thereof  during  the  Severance   Period,
                             determined  at  the  Annual  Target  Bonus  level.
                             Average  bonus will be  determined  over the three
                             years  to  the  end  of  the   Severance   Period,
                             including any partial calendar years; and

                       (D)   if the  Executive  would  have been  eligible  for
                             retirement at the end of the Severance Period, the
                             Executive  shall  be  deemed  to  retire,  and the
                             pension  to  commence,   upon  completion  of  the
                             Severance  Period.  In such case, the  Executive's
                             attained  age at the end of the  Severance  Period
                             will be recognized for purposes of calculating the
                             early retirement  reduction factor, if applicable;
                             and

                (iii)  the  pension  entitlements  described  in  this  Section
                       7.1(b)  shall,  to the extent  legally  permissible,  be
                       provided  through the  Registered  Pension  Plan. To the
                       extent  that it is not  legally  permissible  to provide
                       such pension entitlements through the Registered Pension
                       Plan, the Corporation  shall pay to the Executive a lump
                       sum payment  representing  the  settlement  value of the
                       additional  Executive Benefit Plan benefit determined in
                       accordance  with the  assumptions  set forth in Schedule
                       "B-1";

               (iv)   any  entitlements  of the  Executive  under the Executive
                      Benefit  Plan  which  have   previously  been  funded  in
                      accordance with Article 10 but not previously  settled in
                      accordance  with  Article  10  shall  be  settled  by the
                      Corporation in accordance  with the assumptions set forth
                      in Schedule "B-1";

         (c)    the  Corporation  shall  provide the Executive  with  executive
                outplacement  counselling  to  be  provided  by a  firm  to  be
                selected by the Executive,  at a cost to the Corporation not to
                exceed $25,000.00;

         (d)    all of the Executive's outstanding  unexercisable stock options
                under any Stock Option Plan shall become exercisable; and

         (e)    where the Executive has been  relocated,  at the request of the
                Corporation,  within the two (2) year period  immediately prior
                to the Effective  Date, if so requested by the  Executive,  the
                Corporation   shall   relocate  the   Executive   back  to  the
                Executive's prior location.


<PAGE>
                                    - 15 -


7.2      The  estimated  value as of April 1, 2008 of  Sections  7.l(a)(ii)  to
         7.1(c) are set out in Schedule  "C".  Schedule "C" provides  estimated
         values only and actual values shall be  calculated in accordance  with
         this Restated  Agreement at the time of  entitlement  or payment under
         this Restated Agreement.

7.3      If the  Executive's  employment  is  terminated  in the  circumstances
         described  in  Section  5.1 or 6.1 of  this  Restated  Agreement,  the
         remuneration  and benefits  payable  under this Article 7 shall not be
         reduced if the Executive obtains alternative employment.

7.4      Unless expressly  provided otherwise in this Restated  Agreement,  all
         payments  to be made to the  Executive  under this  Article 7 shall be
         subject to required statutory deductions at source by the Corporation.


                                   ARTICLE 8
                            CONFIDENTIAL INFORMATION
                            ------------------------

8.1      If the Executive's  employment is terminated in any manner  whatsoever
         due to or following a Change of Control,  the Executive agrees to keep
         confidential  all information of a confidential or proprietary  nature
         concerning   the   Corporation,   its   Affiliates,   Associates   and
         Subsidiaries and their respective operations,  opportunities, areas of
         present,  past or  future  interests,  assets,  finances,  technology,
         intellectual property, business and affairs, and further agrees not to
         use such  information,  data or  technology  for  personal  advantage,
         provided  that  nothing   herein  shall  prevent  the   disclosure  of
         information  which is  publicly  available  or which is required to be
         disclosed by the Executive under appropriate statute,  rules of law or
         legal process.


                                   ARTICLE 9
              RIGHTS AND OBLIGATIONS OF EXECUTIVE UPON TERMINATION
              ----------------------------------------------------

9.1      Subject to Section 8.1 of this Restated Agreement, the Executive shall
         not be prohibited in any manner whatsoever from obtaining  alternative
         employment with or otherwise  forming or  participating  in a business
         competitive to the business of the  Corporation  after the termination
         of the Executive's employment with the Corporation.

9.2      Upon the termination of the Executive's employment for any reason, the
         Executive shall tender the Executive's  resignation  from any position
         the Executive may hold as an officer or director of the Corporation or
         any of its Affiliates, Associates or Subsidiaries.

9.3      If the  Executive's  employment  is  terminated  in the  circumstances
         described  in  Section  5.1 or 6.1 of  this  Restated  Agreement,  the
         Corporation  shall  continue to purchase and  maintain,  to the extent
         available in the marketplace at reasonable cost to the Corporation, on
         behalf of the Executive,  director and officer liability insurance for
         the  applicable  limitation  period  following the date upon which the
         Executive ceases to serve as a director or officer of the Corporation,
         and the Executive's  existing  agreement to receive indemnity from the
         Corporation  for  acts  taken  by the  Executive  in  the  Executive's
         capacity as an officer of the Corporation shall remain in effect.


<PAGE>
                                    - 16 -


9.4      Upon termination of the Executive's employment pursuant to Section 5.1
         or 6.1 of this Restated Agreement, the Corporation shall reimburse the
         Executive for ongoing legal fees and disbursements which the Executive
         may reasonably  incur in connection with this Restated  Agreement (but
         this Restated Agreement only), including any litigation concerning the
         validity or  enforceability  of, or liability  under, any provision of
         this  Restated   Agreement  or  any  action  by  the  Executive.   The
         Corporation  shall pay such fees and  reimbursements  to the Executive
         promptly as such fees and disbursements become due.


                                  ARTICLE 10
                      SECURITIZATION AND FUNDING PROCEDURE
                      ------------------------------------

10.1     The  Corporation has established and maintains a trust for the benefit
         of the  Executive  and  persons  claiming  through  him (the  "Trust")
         pursuant to the terms and conditions of a trust  agreement (the "Trust
         Agreement")  between the Corporation and the Trustee.  The Trust shall
         be funded in accordance with the provisions of this Restated Agreement
         and the Trust Agreement.

10.2     To provide  security  against a failure by the  Corporation  to either
         fund or settle the  Obligations  in accordance  with the terms of this
         Article 10, the Trust Agreement  provides for the funding of the Trust
         with the proceeds of an irrevocable  letter of credit which  satisfies
         the requirements of this Restated  Agreement (a "Letter of Credit") in
         the event  that the  Corporation  does not  provide  funding or effect
         settlement when required to do so hereunder and in accordance with the
         terms  hereof.  The  Corporation  confirms  that the  Letter of Credit
         currently  held by the  Trustee  has been  issued by a major  Canadian
         chartered   bank  (the  "Bank")  in  an  amount   calculated   by  the
         Corporation's  consulting  actuary (who at all times shall be a Fellow
         of the Canadian  Institute of Actuaries) (the "Actuary") in accordance
         with the provisions of Section 10.5 of this Restated Agreement.

10.3     On each February 1st (the "Anniversary  Date"),  the Corporation shall
         request a report from the Actuary as to the amount  calculated,  as at
         the next succeeding  April 1st (the "Valuation  Date"),  in accordance
         with the  provisions of Section 10.5 of this Restated  Agreement.  The
         Corporation  shall  provide the  Actuary  with the data it requires to
         prepare  such  report.  Upon  completion  of  each  such  report,  the
         Corporation shall arrange for the Actuary to provide a summary of same
         to the Trustee.

         Prior to the funding  and/or  settlement of all of the  Obligations in
         accordance with the terms of this Restated Agreement,  the Corporation
         shall,  within  forty-five days after the applicable  Anniversary Date
         and in  accordance  with the  terms of the  report  received  from the
         Actuary:

         (a)    either:

                (i)    arrange  for a Letter of Credit  to be  provided  by the
                       Bank to the Trustee to replace the Letter of Credit then
                       held by the Trustee.  The  replacement  Letter of Credit
                       shall be:


<PAGE>
                                    - 17 -


                       (A)   substantially  in the form of the Letter of Credit
                             then held by the Trustee;

                       (B)   in an amount  calculated  by the Actuary as at the
                             applicable  Valuation Date in accordance  with the
                             provisions   of  Section  10.5  of  this  Restated
                             Agreement; and

                       (C)   for a term  which  commences  on the  date  of its
                             issuance  and  expires  one  year   following  the
                             applicable Valuation Date; or

                (ii)   confirm to the  Trustee  in  writing  that the Letter of
                       Credit  then  held  by  the  Trustee  will  be  extended
                       automatically   for  a  further   one-year   term.   The
                       confirmation to the Trustee shall include  evidence from
                       the Bank as to any amendment to the applicable Letter of
                       Credit,  any such  amendment to be  consistent  with the
                       report  prepared  by the  Actuary  as at the  applicable
                       Valuation Date; and

         (b)    contribute  to the  Trust an  amount  equal  to  twice  the fee
                charged  by the Bank in  connection  with the  Letter of Credit
                extension or replacement,  as applicable. The Corporation shall
                withhold  one-half  of such  amount  and  shall  remit the said
                one-half of such amount to the Canada Revenue Agency on account
                of the  tax  which  is  exigible  pursuant  to the  Tax  Act in
                connection  with such  contribution  to the Trust.  The Trustee
                shall remit the  remaining  one-half of such amount to the Bank
                in  consideration   for  the  Letter  of  Credit  extension  or
                replacement, as applicable.

         When a  replacement  Letter of Credit has been  provided in accordance
         with the terms of this  Section  10.3,  an  existing  Letter of Credit
         shall be surrendered and cancelled.

10.4     If,  during  the term of a Letter of Credit  issued  pursuant  to this
         Restated Agreement, the Corporation, acting reasonably, concludes that
         there has been a significant  change in the Obligations since the date
         of the last report prepared by the Actuary pursuant to Section 10.3 of
         this Restated  Agreement,  the Corporation shall request a report from
         the  Actuary  as  to  the  then  current  value  of  the  Obligations,
         calculated in accordance  with the  provisions of Section 10.5 of this
         Restated Agreement.  Upon receipt of the report, the Corporation shall
         provide a summary of same to the Trustee and  arrange,  together  with
         the Trustee,  for any  required  increase or decrease in the amount of
         the  Letter of Credit for the  balance  of the term of such  Letter of
         Credit.  In the  event  that a  replacement  Letter of Credit is to be
         issued  in the  circumstances  described  in this  Section  10.4,  the
         Corporation and the Trustee shall arrange for such replacement  Letter
         of Credit to be  provided  by the Bank to the  Trustee to replace  the
         Letter  of  Credit  then  held  by  the  Trustee.  Upon  receipt  of a
         replacement  Letter of  Credit  pursuant  to this  Section  10.4,  the
         Trustee  shall  surrender for  cancellation  the Letter of Credit then
         held  by  it  pursuant  to  this  Restated  Agreement  and  the  Trust
         Agreement.

         In the event that all or any portion of the fee referred to in Section
         10.3 of this Restated  Agreement,  is refunded by the Bank as a result
         of a  decrease  in the amount of a Letter of Credit  pursuant  to this

<PAGE>
                                    - 18 -


         Section 10.4, such amount (together with any resulting refundable Tax)
         shall be  received  by the  Trustee  for  deposit to the  Trust.  Upon
         receipt  of  an  Authorized  Instruction  (as  defined  in  the  Trust
         Agreement),  the Trustee shall pay and transfer such amounts (less any
         applicable  tax  which  it will  remit as  required  by the Tax Act on
         behalf  of the  Corporation)  to the  Corporation  for  its  sole  and
         exclusive use and benefit.

         In the event that an additional fee is required to be paid to the Bank
         as a  result  of an  increase  in the  amount  of a Letter  of  Credit
         pursuant to this Section 10.4, the Corporation shall contribute to the
         Trust an amount equal to twice the  additional  fee.  The  Corporation
         shall  withhold  one-half  of such  amount  and  shall  remit the said
         one-half of such amount to the Canada Revenue Agency on account of the
         tax which is exigible  pursuant to the Tax Act in connection with such
         contribution  to the Trust.  The  Trustee  shall  remit the  remaining
         one-half of such amount to the Bank in payment of its additional fee.

10.5     A Letter of Credit issued pursuant to this Restated Agreement shall:

                (i)    be an irrevocable standby letter of credit;

                (ii)   obligate the Bank to satisfy  demand for payment made by
                       the  Trustee  in  accordance  with  the  terms  of  this
                       Restated Agreement and the Trust Agreement;

                (iii)  permit partial drawings; and

                (iv)   provide  that the Bank must  notify  the  Trustee  on or
                       before  thirty  days  prior to the expiry of a Letter of
                       Credit of any notice of  non-extension  provided  by the
                       Bank to the Corporation.

         The amount of a Letter of Credit  pursuant to this Restated  Agreement
         shall be calculated  by the Actuary in  accordance  with the following
         subparagraphs of this Section 10.5.

         (a)    Assuming the lump sum payments referred to in Section 7.1(a) of
                this  Restated  Agreement  are  equal  to  the  amount  thereof
                provided by the Corporation.

         (b)    Assuming  the  service  of the  Executive  will  terminate,  in
                accordance with Section 5.1 or 6.1 of this Restated  Agreement,
                on the next succeeding March 31st after the Valuation Date (the
                "Calculation Date").

         (c)    Using the Executive's  demographic data, including base salary,
                target  bonus and current  marital  status as of the  Valuation
                Date, provided by the Corporation.

         (d)    Using the Yearly Maximum  Pensionable  Earnings (Y.M.P.E.) used
                to determine the amount of the Canada  Pension Plan Benefit and
                Tax Act maximum  defined benefit pension dollar limit as at the
                Valuation Date.

         (e)    Assuming all Obligations are included.


<PAGE>
                                    - 19 -


         (f)    Using  the  actuarial  methods,   assumptions  and  calculation
                methodology described in Schedule "B-2.

         (g)    Applying a load of 15% to the amount  determined  in accordance
                with  subparagraphs  (b)  through (f) of this  Section  10.5 to
                provide  for  fluctuations  in  the  Interest   Discount  Rate,
                Consumer Price Index and other plan experience  during the term
                of the Letter of Credit, as described in Schedule "B-2".

         (h)    Applying  a load  to  one-half  of  the  amount  determined  in
                accordance with  subparagraphs  (a) through (g) of this Section
                10.5 to provide  for the cost  associated  with the  borrowings
                described  in  subparagraph   (k)  of  this  Section  10.5,  as
                described in Schedule "B-2".

         (i)    Including  a  settlement  expense to the amount  determined  in
                subparagraph  (h),  with  the  aggregate   settlement   expense
                allowance for all  obligations  secured  equal to $250,000,  or
                where  the  Valuation  Date is after  December  31,  2008,  the
                aggregate settlement expense allowance will be increased at the
                rate equal to the  increase in the  Consumer  Price  Index,  as
                described in Schedule "B-2", plus 1% for each year after 2008.

         (j)    Assuming  the  Obligations  will be promptly  settled  with the
                Executive upon  occurrence of a Designated  Event  described in
                Section 1.1(n)(ii).

         (k)    Assuming  a loan will be secured  to permit  settlement  of the
                Obligations prior to receipt of the Refundable Tax Account from
                the Canada Revenue Agency. The assumed interest rate payable on
                the loan shall be as  described  in  Schedule  "B-2".  The cost
                associated with the borrowings shall be assumed to be paid from
                the Trust.

         (l)    The liabilities calculated in accordance with subparagraphs (a)
                through (k) above shall be offset by:

                (i)    the Refundable Tax Account, if any; and

                (ii)   the assets contained in the Trust, if any.

10.6     (a)    If an Executive  Benefit Plan  Obligations  - Designated  Event
                shall occur,  the Corporation  shall be required to immediately
                fund the Executive  Benefit Plan Obligations in accordance with
                the most recent  report  prepared  by the  Actuary  pursuant to
                Section 10.3 of this Restated  Agreement.  Notwithstanding  the
                foregoing,   if  an  Executive   Benefit  Plan   Obligations  -
                Designated Event described in Section 1.1(x)(i) and a Change of
                Control  Obligations  - Designated  Event  described in Section
                1.1(n)(ii) shall occur simultaneously, the Corporation shall be
                required  to settle  the  Executive  Benefit  Plan  Obligations
                forthwith in accordance with the provisions of Schedule "B-1".


<PAGE>
                                    - 20 -


         (b)    If:

                (i)    the  employment  of the  Executive is  terminated by the
                       Corporation for any reason other than as a result of the
                       death, disability or retirement of such Executive; and

                (ii)   such  Executive  files  with the  Corporation  a written
                       request  that  it  fund  the   Executive   Benefit  Plan
                       Obligations,

                  the  Corporation  shall be required to  immediately  fund the
                  Executive  Benefit Plan  Obligations  in accordance  with the
                  most  recent  report  prepared  by the  Actuary  pursuant  to
                  Section 10.3 of this Restated Agreement.

         (c)    Upon the earlier of:

                (i)    learning of the occurrence of an Executive  Benefit Plan
                       Obligations  -  Designated  Event  described  in Section
                       1.1(x)(v) or (vi) of this Restated Agreement; or

                (ii)   receipt  of a  written  notice of the  occurrence  of an
                       Executive  Benefit Plan  Obligations - Designated  Event
                       described in any of the other  subparagraphs  of Section
                       1.1(x) of this Restated Agreement, which notice has been
                       signed by two executives of the Corporation, one of whom
                       must  be  either  the  Chief  Financial  Officer  or the
                       General  Counsel  of the  Corporation  and which  notice
                       must,   in  the  case  of  an  Executive   Benefit  Plan
                       Obligations  -  Designated  Event  described  in Section
                       1.1(x)(i) of this  Restated  Agreement,  indicate  which
                       subparagraph of the definition of "Change of Control" is
                       applicable,

                  the Trustee shall promptly give notice to the  Corporation in
                  writing that it intends to draw on that portion of the Letter
                  of Credit which is referable  to the  Executive  Benefit Plan
                  Obligations  and  contribute  the proceeds  thereof (less any
                  applicable withholding tax which it will remit as required by
                  the Tax Act on  behalf  of the  Corporation)  to the Trust on
                  behalf  of the  Corporation  in order  to fund the  Executive
                  Benefit  Plan  Obligations,  unless it receives  satisfactory
                  proof  within nine days of such  notice that the  Corporation
                  has funded or settled,  as applicable,  the Executive Benefit
                  Plan Obligations  itself in accordance with the terms of this
                  Restated Agreement.

                  Unless the Corporation advises the Trustee in writing that it
                  has funded or settled,  as applicable,  the Executive Benefit
                  Plan  Obligations  in  accordance  with  the  terms  of  this
                  Restated   Agreement   and  has  provided  the  Trustee  with
                  satisfactory  proof  thereof  within nine days of the date of
                  the  aforementioned  notice,  the Trustee  shall draw on that
                  portion of the  Letter of Credit  which is  referable  to the
                  Executive Benefit Plan Obligations on the tenth day following
                  the date of such notice (or the next  following  business day
                  if such tenth day is not a business day) and  contribute  the

<PAGE>
                                    - 21 -


                  proceeds  thereof (less any applicable  withholding tax which
                  it will  remit as  required  by the Tax Act on  behalf of the
                  Corporation) to the Trust on behalf of the Corporation.

                  Notwithstanding  the  foregoing,  in the  event an  Executive
                  Benefit  Plan  Obligations  - Designated  Event  described in
                  Section  1.1(x)(v)  or (vi) of this  Restated  Agreement  has
                  triggered  the operation of this Section 10.6 and the failure
                  which gave rise to the occurrence of such  Executive  Benefit
                  Plan  Obligations - Designated  Event has been remedied prior
                  to the  expiration of the notice period  provided for in this
                  Section  10.6(c),  the  Trustee  shall  not take  the  action
                  described in the immediately  preceding  paragraph hereof and
                  all  of the  provisions  of  this  Restated  Agreement  shall
                  continue  to apply to the  same  extent  and as fully as they
                  would  have in the event  that such  Executive  Benefit  Plan
                  Obligations - Designated Event had not occurred.

         (d)    Upon  receipt  of a  written  notice of the  occurrence  of the
                events described in both  subparagraphs (i) and (ii) of Section
                10.6(b)  of this  Restated  Agreement  (which  notice  has been
                signed by the Executive and sworn before a notary public),  the
                Trustee  shall  promptly  give  notice  to the  Corporation  in
                writing  that it intends to draw on that  portion of the Letter
                of Credit  which is  referable  to the  Executive  Benefit Plan
                Obligations  and  contribute  the proceeds (less any applicable
                withholding  tax which it will remit as required by the Tax Act
                on  behalf  of the  Corporation)  to the Trust on behalf of the
                Corporation  in  order  to  fund  the  Executive  Benefit  Plan
                Obligations  unless it receives  satisfactory proof within nine
                days of the date of such notice that the Corporation has funded
                the  Executive  Benefit Plan  Obligations  itself in accordance
                with the terms of this Restated Agreement.

                  Unless the Corporation advises the Trustee in writing that it
                  has  funded  the  Executive   Benefit  Plan   Obligations  in
                  accordance with the terms hereof and has provided the Trustee
                  with satisfactory  proof thereof within nine days of the date
                  of the  aforementioned  notice,  the Trustee  shall draw upon
                  that  portion of the Letter of Credit  which is  referable to
                  the  Executive  Benefit  Plan  Obligations  on the  tenth day
                  following  the date of such  notice  (or the  next  following
                  business  day if such  tenth day is not a  business  day) and
                  contribute the proceeds (less any applicable  withholding tax
                  which it will remit as  required  by the Tax Act on behalf of
                  the Corporation) to the Trust on behalf of the Corporation.

         (e)    For purposes of determining  the required  amount of funding or
                the portion of the Letter of Credit to be drawn on for purposes
                of this  Section  10.6,  the  Trustee  shall  refer to the most
                recent  report  prepared by the  Actuary  for  purposes of this
                Restated  Agreement and, in  particular,  to the portion of the
                report dealing with the Executive Benefit Plan Obligations.  In
                preparing  the  portion  of  its  report  respecting  Executive
                Benefit  Plan  Obligations,  the  Actuary  shall  adhere to the
                following:


<PAGE>
                                    - 22 -


                (i)    Assuming   that  the   Executive,   if  then  in  active
                       employment,  will remain in active  employment  with the
                       Corporation as an officer until the Calculation Date and
                       that the  Executive's  employment  with the  Corporation
                       will terminate on the Calculation Date.

                (ii)   Using the Executive's  demographic data,  including base
                       salary,  actual bonus history,  target bonus and current
                       marital status as of the Valuation Date, provided by the
                       Corporation.

                (iii)  Using  the  Canada  Pension  Plan  Benefit  and  Tax Act
                       maximum  defined  benefit pension dollar limit as at the
                       Valuation Date.

                (iv)   Assuming the Executive's target bonus percentage remains
                       at the level  specified by the  Corporation  pursuant to
                       subparagraph (ii) above.

                (v)    Assuming only  Executive  Benefit Plan  Obligations  are
                       included.

                (vi)   Assuming the payments  under the Executive  Benefit Plan
                       would be made from the Trust.

                (vii)  Using the actuarial methods, assumptions and calculation
                       methodology described in Schedule "B-2.

                (viii) Applying  loads as  described  in Schedule  "B-2" to the
                       amount  determined  in  accordance  with  the  preceding
                       subparagraphs  of this  Section  10.6(e) to provide  for
                       future contingencies and expenses of the Trust.

                (ix)   Calculating the estimated  amount required to settle the
                       Executive   Benefit  Plan   Obligations   based  on  the
                       actuarial    methods,    assumptions   and   calculation
                       methodology  described in Schedule  "B-2",  increased by
                       the loads described in the following subparagraph.

                (x)    Applying  loads as  described  in Schedule  "B-2" to the
                       amount  determined in accordance with  subparagraph (ix)
                       to provide for:

                       (A)   fluctuations  in the  Interest  Discount  Rate and
                             Consumer Price Index during the term of the Letter
                             of Credit; and

                       (B)   the cost associated with the loan to be secured as
                             allowed  under  the  Trust   Agreement  to  permit
                             settlement   of   the   Executive   Benefit   Plan
                             Obligations prior to receipt of the Refundable Tax
                             Account  from  the  Canada  Revenue  Agency.   The
                             assumed interest rate payable on the loan shall be
                             as  described  in  Schedule  "B-2"  and  shall  be
                             applied to one-half of the amount in  subparagraph
                             (ix).  The cost  associated  with  the  borrowings
                             shall be assumed to be paid from the Trust.


<PAGE>
                                    - 23 -


                (xi)   Taking the larger amount for the Executive of:

                       (A)   the   amount   determined   in   accordance   with
                             subparagraphs (i) through (viii), and

                       (B)   the   amount   determined   in   accordance   with
                             subparagraphs (ix) and (x).

                (xii)  The amount  determined in accordance  with  subparagraph
                       (xi) above shall be offset by:

                       (A)   the Refundable Tax Account, if any;

                       (B)   the assets contained in the Trust, if any.

        (f)     In the event that the Executive  Benefit Plan  Obligations have
                been funded in accordance with the terms hereof as a result of:

                (i)    the Corporation  making an assignment for the benefit of
                       creditors or filing a petition in bankruptcy or becoming
                       insolvent or bankrupt;

                (ii)   a  receiver,   trustee  or  liquidator  of  or  for  the
                       Corporation  being  appointed  and not being  discharged
                       within a period of sixty days;

                (iii)  a voluntary  dissolution or wind-up of the  Corporation;
                       or

                (iv)   a sale or disposition of all or substantially all of the
                       assets of the Corporation,

                  and  the  Executive  Benefit  Plan  has  been  terminated  in
                  connection therewith,  the Executive Benefit Plan Obligations
                  shall be promptly  settled by the Trustee with the  Executive
                  by way  of a lump  sum  payment  from  the  Trust.  For  this
                  purpose,  the benefit entitlements of each Executive shall be
                  determined by the Actuary in accordance with the terms of the
                  Executive Benefit Plan and the amount of the lump sum payment
                  shall be determined by the Actuary using the  assumptions set
                  forth  in  Schedule  "B-1".  Notice  of  termination  of  the
                  Executive  Benefit  Plan shall be  provided to the Trustee by
                  the  Corporation,  failing  which  by two  executives  of the
                  Corporation,  one of whom must be either the Chief  Financial
                  Officer or the General Counsel of the Corporation.

                  Any assets of the Trust remaining after full  satisfaction of
                  (i) the Executive  Benefit Plan  Obligations  pursuant to the
                  preceding paragraph and (ii) any further obligations pursuant
                  to the terms of the Trust Agreement, shall be returned to the
                  Corporation.

         (g)    In the event the Executive  Benefit Plan shall be terminated at
                any  time  either  in  whole  or in  part  in  relation  to the

<PAGE>
                                    - 24 -


                Executive  subsequent to the funding of the  Executive  Benefit
                Plan  Obligations  in accordance  with the terms hereof,  then,
                provided  Section  10.6(f) of this  Restated  Agreement  is not
                otherwise  applicable,  the Executive  Benefit Plan Obligations
                shall be promptly  settled by the Trustee with the Executive by
                way of a lump sum payment from the Trust.

                  For this purpose,  the benefit  entitlements of the Executive
                  shall be  determined  by the Actuary in  accordance  with the
                  terms of the  Executive  Benefit  Plan and the  amount of the
                  lump sum payment shall be determined by the Actuary using the
                  assumptions  set  forth  in  Schedule  "B-1".  Notice  of the
                  termination  of the Executive  Benefit Plan shall be provided
                  to the  Trustee  by the  Corporation,  failing  which  by two
                  executives of the Corporation, one of whom must be either the
                  Chief  Financial  Officer  or  the  General  Counsel  of  the
                  Corporation.

                  Any assets of the Trust remaining after full  satisfaction of
                  (i) the  Executive  Benefit  Plan  Obligations  and  (ii) any
                  further  obligations  pursuant  to the  terms  of  the  Trust
                  Agreement, shall be returned to the Corporation.

         (h)    In the event:

                (i)    of a dispute as to whether a payment to or in respect of
                       the  Executive is properly  due and payable  pursuant to
                       the Executive Benefit Plan; and

                (ii)   such dispute  cannot be resolved by the parties  thereto
                       within the time frame specified in Section 1.1(x)(vi) of
                       this Restated Agreement,

                  the amount in dispute  shall be  remitted  to the Trustee for
                  deposit to the Trust.  Upon final  settlement of the dispute,
                  the amount so deposited (together with any earnings,  profits
                  and increments  thereon and after deduction of any authorized
                  payments allocable thereto,  both as determined in accordance
                  with the terms of the Trust  Agreement),  less any applicable
                  withholding tax which will be remitted as required by the Tax
                  Act,  shall  be paid to that  party to the  dispute  which is
                  found to be entitled thereto. Prior to such amount being paid
                  out of the Trust in  accordance  with the terms  hereof,  the
                  Corporation  shall  instruct  the Actuary to take such amount
                  into account when  preparing  its report for purposes of this
                  Restated Agreement.

         (i)    In the event that a Change of Control  Obligations - Designated
                Event   described  in  Section   1.1(n)(ii)  of  this  Restated
                Agreement  shall  occur   subsequent  to  the  funding  of  the
                Executive Benefit Plan Obligations in accordance with the terms
                of this Restated  Agreement,  the Corporation shall be required
                to settle the Executive  Benefit Plan Obligations  forthwith in
                an amount  determined  by the  Actuary in  accordance  with the
                provisions of Schedule "B-1".

         (j)    Subject  to  Section  10.6(f),  10.6(g)  and  10.6(i)  of  this
                Restated  Agreement,  in the event that the  Executive  Benefit

<PAGE>
                                    - 25 -


                Plan  Obligations have been funded in accordance with the terms
                hereof,  all  or a  portion  of  such  Executive  Benefit  Plan
                Obligations  may,  at the  discretion  of the  Corporation,  be
                promptly settled with the Executive.

                  For this purpose,  the benefit  entitlements of the Executive
                  shall be  determined  by the Actuary in  accordance  with the
                  terms of the Executive  Benefit Plan. In such  circumstances,
                  the  Corporation  reserves the right to settle the  Executive
                  Benefit Plan  Obligations by way of a lump sum payment to the
                  Executive  provided  that the amount of each such  payment is
                  determined by the Actuary in accordance  with the assumptions
                  set forth in Schedule "B-1".

10.7     (a)    If a Change of Control Obligations - Designated Event described
                in Section  1.1(n)(i) of this Restated  Agreement  shall occur,
                the  Corporation  shall be  required  to  immediately  fund the
                Change  of  Control  Obligations  in  accordance  with the most
                recent report prepared by the Actuary  pursuant to Section 10.3
                of this Restated Agreement.

         (b)    If a Change of Control Obligations - Designated Event described
                in Section  1.1(n)(ii) of this Restated  Agreement shall occur,
                the  Corporation  shall be  required  to settle  the  Change of
                Control Obligations forthwith in accordance with the provisions
                of Schedule "B-1", upon receipt by the Corporation of a Release
                executed by the Executive in the form attached to this Restated
                Agreement as Schedule "A".

         (c)    Upon the earlier of:

                (i)    learning  of  the  occurrence  of a  Change  of  Control
                       Obligations  -  Designated  Event  described  in Section
                       1.1(n)(i) of this Restated Agreement; or

                (ii)   receipt  of a  written  notice  of the  occurrence  of a
                       Change  of  Control   Obligations  -  Designated   Event
                       described  in  Section   1.1(n)(ii)   of  this  Restated
                       Agreement, which notice has been signed by the Executive
                       and sworn before a notary public and has annexed thereto
                       a Release executed by the Executive in the form attached
                       to this Restated Agreement as Schedule "A",

                  the Trustee shall promptly give notice to the  Corporation in
                  writing that it intends to draw on that portion of the Letter
                  of  Credit  which  is  referable  to the  Change  of  Control
                  Obligations  and  contribute  the proceeds  thereof (less any
                  applicable withholding tax which it will remit as required by
                  the Tax Act on  behalf  of the  Corporation)  to the Trust on
                  behalf  of the  Corporation  in order to fund the  Change  of
                  Control  Obligations,  unless it receives  satisfactory proof
                  within  nine days of such  notice  that the  Corporation  has
                  funded or  settled,  as  applicable,  the  Change of  Control
                  Obligations  itself  in  accordance  with  the  terms of this
                  Restated Agreement.

<PAGE>
                                    - 26 -


                  Unless the Corporation advises the Trustee in writing that it
                  has funded or settled,  as applicable,  the Change of Control
                  Obligations  in  accordance  with the terms of this  Restated
                  Agreement  and has  provided  the Trustee  with  satisfactory
                  proof   thereof   within   nine  days  of  the  date  of  the
                  aforementioned notice, the Trustee shall draw on that portion
                  of the Letter of Credit  which is  referable to the Change of
                  Control  Obligations  on the tenth day  following the date of
                  such notice (or the next following business day if such tenth
                  day is not a business day) and  contribute the proceeds (less
                  any  applicable  withholding  tax  which  it  will  remit  as
                  required by the Tax Act on behalf of the  Corporation) to the
                  Trust on behalf of the Corporation.

                  Notwithstanding  the  foregoing,  in the  event a  Change  of
                  Control  Obligations - Designated  Event described in Section
                  1.1(n)(i)  of  this  Restated  Agreement  has  triggered  the
                  operation  of this  Section  10.7 and the failure  which gave
                  rise to the occurrence of such Change of Control  Obligations
                  - Designated  Event has been remedied prior to the expiration
                  of the notice  period  provided for in this Section  10.7(c),
                  the  Trustee  shall  not take  the  action  described  in the
                  immediately   preceding  paragraph  hereof  and  all  of  the
                  provisions of this Restated Agreement shall continue to apply
                  to the same  extent  and as fully as they  would  have in the
                  event that such Change of Control  Obligations  -  Designated
                  Event had not occurred.

         (d)    The required  amount of funding or the portion of the Letter of
                Credit to be drawn on for  purposes of this  Section 10.7 shall
                be determined by the Actuary and shall be the amount determined
                in  accordance  with  Sections  10.5(a)  through  (l)  of  this
                Restated   Agreement   offset  by  the  amount   determined  in
                accordance with subparagraphs  10.6(e)(i) through (xii) of this
                Restated Agreement.  The settlement amount for purposes of this
                Section  10.7  shall  be  determined  in  accordance  with  the
                provisions of Schedule "B-1".

         (e)    In the event that the Change of Control  Obligations  have been
                funded in  accordance  with the terms hereof as a result of the
                occurrence  of a Change of  Control  Obligations  -  Designated
                Event  described in Section  1.1(n)(ii),  the Change of Control
                Obligations  shall be promptly  settled  with the  Executive in
                accordance with the provisions of Schedule "B-1".

10.8     The actuarial methods and assumptions  described in Schedule "B-1" and
         Schedule  "B-2" shall be reviewed from time to time. Any amendments to
         Schedule "B-1" and/or  Schedule "B-2" as a result of such review shall
         be dealt with in accordance with Section 12.6.

10.9     The Trustee shall  surrender  the Letter of Credit to the  Corporation
         for cancellation upon the earliest of:

         (a)    receipt  by the  Trustee of a written  direction  signed by the
                Corporation and the Executive directing surrender of the Letter
                of Credit;

<PAGE>
                                    - 27 -


         (b)    receipt  by the  Trustee of a written  direction  signed by the
                Corporation  confirming  that it has funded and/or  settled the
                Obligations in accordance with the terms hereof,  together with
                evidence which is satisfactory to the Trustee that such funding
                and/or settlement has occurred; and

         (c)    receipt  by the  Trustee of a written  direction  signed by the
                Corporation  confirming  that the  Corporation has no remaining
                Obligations to the  Executive,  together with evidence which is
                satisfactory  to  the  Trustee  that  the  Corporation  has  no
                remaining  Obligations to the Executive and that a copy of such
                written direction has been provided to the Executive.

10.10    The Trust shall be terminated by the Trustee upon the earliest of:

         (a)    receipt  by the  Trustee of a written  direction  signed by the
                Corporation and the Executive confirming the termination of the
                Trust;

         (b)    the  entire  depletion  of  the  Trust  Fund  through  payments
                pursuant to the terms of the Trust Agreement, in the event that
                such  depletion  occurs   subsequent  to  the  funding  of  the
                Obligations  in  accordance  with the  terms  of this  Restated
                Agreement; and

         (c)    receipt  by the  Trustee of a written  direction  signed by the
                Corporation  confirming  that the  Corporation has no remaining
                Obligations to the  Executive,  together with evidence which is
                satisfactory  to  the  Trustee  that  a copy  of  such  written
                direction has been provided to the Executive.

         Upon the  termination  of the  Trust,  any  assets of the Trust  which
         remain after the  satisfaction  of any  remaining  Obligations  of the
         Corporation to the Executive shall be returned to the Corporation.

10.11    The  Corporation  and  the  Executive  hereby   acknowledge  that  the
         Corporation  is  entering  into  agreements  similar to this  Restated
         Agreement   with  certain  of  its  other   executives  and  that  the
         Corporation  may,  at its  sole  discretion,  arrange  for one or more
         Letters of Credit to satisfy its responsibilities  under this Restated
         Agreement and such other  agreements.  In the event that one Letter of
         Credit is obtained to satisfy the Corporation's responsibilities under
         this  Restated  Agreement  and some or all of such  other  agreements,
         references to a "Letter of Credit" in this Restated Agreement shall be
         read as  references  to that portion of such Letter of Credit which is
         referable to the responsibilities of the Corporation to the Executive.

         The   Corporation  and  the  Executive  also   acknowledge   that  the
         Corporation may, at its sole discretion,  enter into one or more Trust
         Agreements  to  satisfy  its  responsibilities   under  this  Restated
         Agreement  and such  other  agreements.  In the  event  that one Trust
         Agreement   is   entered    into   to   satisfy   the    Corporation's
         responsibilities under this Restated Agreement and some or all of such
         other agreements,  references to "Trust", "Trust Agreement", "Trustee"

<PAGE>
                                    - 28 -


         and "Refundable Tax Account" in this Restated  Agreement shall be read
         with such modifications as may be necessary in the context.

10.12    At the discretion of the  Corporation and subject to the provisions of
         applicable  law, in the event that all or a portion of the Obligations
         are funded in  accordance  with  Article  10 hereof  and an  actuarial
         surplus  (determined  by actuarial  valuation in  accordance  with the
         terms of the report prepared as at the immediately preceding Valuation
         Date in  accordance  with  Section  10.3 of this  Restated  Agreement)
         arises as a result thereof:


         (a)    all or a portion of such  actuarial  surplus may be used in the
                determination of or to reduce the funding otherwise required to
                be provided by the Corporation hereunder; or


         (b)    any surplus  assets may, to the extent that they exceed 110% of
                the amount  required  to fund that  portion of the  Obligations
                which has been funded (as determined by the report  prepared as
                at the immediately  preceding Valuation Date in accordance with
                Section  10.3 of this  Restated  Agreement)  be returned to the
                Corporation.


                                  ARTICLE 11
                             EXPEDITED ARBITRATION
                             ---------------------

11.1     If, pursuant to Section 6.1 of this Restated Agreement,  the Executive
         provides written notice of the Executive's  intention to terminate the
         Executive's  employment for Good Reason, and the Corporation  believes
         that there is no Good  Reason,  or,  alternatively,  if,  pursuant  to
         Section  4.1 of this  Restated  Agreement,  the  Corporation  provides
         written   notice  of  its  intention  to  terminate  the   Executive's
         employment for Just Cause and the Executive  believes there is no Just
         Cause, the Corporation or the Executive, as applicable,  shall, within
         ten (10) days of having been  provided  such notice,  provide  written
         notice  ("Notice of  Dispute")  to the other Party of the dispute (the
         "Dispute").

11.2     The Parties agree that any and all Disputes under Section 11.1 of this
         Restated Agreement will be resolved by way of a single Arbitrator.

11.3     (a)    Within fifteen (15) days of provision of the Notice of Dispute,
                the Parties  shall agree upon and appoint a neutral  Arbitrator
                from  the  then  current  roster   maintained  by  the  Alberta
                Mediation and  Arbitration  Society to act as Arbitrator of the
                Dispute; or

         (b)    If no person  acceptable  to both  Parties has been agreed upon
                and appointed  within fifteen (15) days,  then either Party may
                make  immediate  application  to the Court of Queen's  Bench of
                Alberta,  Judicial  District of Calgary,  to have an Arbitrator
                appointed.
<PAGE>
                                    - 29 -


11.4     The Parties  acknowledge and agree that the purpose of this Article 11
         is to avoid delays and facilitate resolution of the Dispute in a just,
         speedy and cost-effective manner.

11.5     Consistent with the expedited  nature of  arbitration,  the Arbitrator
         will  direct  and  control  the scope and  timing of the  exchange  of
         information  between  the  Parties  and will  take  such  steps as the
         Arbitrator   deems   necessary   to   achieve  a  just,   speedy   and
         cost-effective  resolution  of the  Dispute.  The  Arbitrator  has the
         exclusive  right  and  power to  resolve  all  issues  related  to the
         exchange of information in the arbitration process.

11.6     The Parties agree that the Arbitrator is only  authorized to determine
         whether the Executive had Good Reason for  terminating the Executive's
         employment,  or alternatively,  whether the Corporation had Just Cause
         to terminate the Executive's employment.

11.7     A hearing will occur within forty-five (45) days of the appointment of
         the Arbitrator (the "Hearing").  The time of the Hearing (the "Hearing
         Date") will be scheduled by the Arbitrator after consultation with the
         Parties.  The  Hearing  will be  governed  by the rules set out in the
         ARBITRATION  ACT S.A. 1991,  c.A-43,  as modified by the Arbitrator in
         the  interests  of  achieving  a  just,   speedy  and   cost-effective
         resolution  of  the  Dispute.   The  Arbitrator  may  require  written
         submissions  of fact in the  Dispute  to be  provided  seven  (7) days
         before the Hearing Date.

11.8     The  Arbitrator  will use best  efforts to provide a written  decision
         within seven (7) days of the conclusion of the Hearing.

11.9     The Parties  agree that the decision of the  Arbitrator  will be final
         and binding upon the Parties.


                                   ARTICLE 12
                                    GENERAL
                                    -------

12.1     The headings of the Articles and paragraphs in this Restated Agreement
         are inserted for convenience  only and shall not affect the meaning or
         construction of this Restated Agreement.

12.2     This  Restated   Agreement  shall  be  construed  and  interpreted  in
         accordance  with the laws of the  Province  of Alberta and the federal
         laws of Canada as applicable therein.

12.3     If any provision of this  Restated  Agreement is determined to be void
         or  unenforceable in whole or in part, it shall be and be deemed to be
         severed from this Restated  Agreement  without  affecting or impairing
         the validity of any other provision herein.

12.4     Any notice  required  or  permitted  to be given  under this  Restated
         Agreement shall be in writing and shall be properly given if delivered
         by hand  delivery  or mail or other form of  electronic  communication
         capable of transmission confirmation to the following address:


<PAGE>
                                    - 30 -

         a.     IN THE CASE OF THE CORPORATION TO:
                ----------------------------------

                Nexen Inc.
                801 - 7th Avenue S.W.
                Calgary, AB  T2P 3P7
                Attention:   General Manager, Compensation and Benefits

         b.     IN THE CASE OF THE EXECUTIVE TO:
                --------------------------------

                the  last  address  of  the  Executive  in the  records  of the
                Corporation  or to such other  address as the  Parties may from
                time to time specify by notice given in accordance herewith.

12.5     This Restated  Agreement  shall enure to the benefit of and be binding
         upon  the  Executive  and  the   Executive's   heirs,   executors  and
         administrators  and  upon  the  Corporation  and  its  successors  and
         assigns.

12.6     This Restated  Agreement  constitutes the entire agreement relating to
         the  respective  rights  and  obligations  of  the  Parties  upon  the
         occurrence  of a Change of  Control.  No  amendment  or waiver of this
         Restated  Agreement shall be binding unless executed in writing by the
         Parties.

         Notwithstanding the foregoing,

         (a)    any  amendment  to  Article  10  of  this  Restated  Agreement,
                Schedule  "B-1" or  Schedule  "B-2" which is required to ensure
                that the balance  remaining in the Trust after the required tax
                has been withheld and remitted to the Canada  Revenue Agency is
                sufficient  to satisfy the fee levied by the Bank in connection
                with the  issuance  of a Letter  of  Credit  may be made by the
                Corporation   without  the  prior   written   approval  of  the
                Executive; and

         (b)    the Corporation  may amend,  modify or waive Article 10 of this
                Restated Agreement,  Schedule "B-1" and Schedule "B-2" in whole
                or in part,  at such  time and from  time to time,  and in such
                manner  and to such  extent  as it may deem  advisable  without
                obtaining  the approval of the  Executive,  provided  that such
                amendment, modification or waiver, as the case may be, does not
                adversely  affect the  securitization  in  accordance  with the
                terms hereof of those  Obligations which have accrued up to the
                date of such amendment, modification or waiver, as the case may
                be.

12.7     The Parties agree that the rights,  entitlements  and benefits set out
         in this Restated  Agreement to be paid to the Executive  upon a Change
         of  Control  shall  be in  full  satisfaction  of  all  rights  of the
         Executive under applicable law in effect from time to time as a result
         thereof.

12.8     Neither Party can waive or shall be deemed to have waived any right it
         has under  this  Restated  Agreement  except to the  extent  that such
         waiver is in writing.


<PAGE>
                                    - 31 -


12.9     Nothing  contained in this  Restated  Agreement  shall be construed as
         limiting the ability of the Corporation to amend,  modify or terminate
         the Executive  Benefit Plan in whole or in part, at such time and from
         time to time,  and in such  manner  and to such  extent as it may deem
         advisable.

The Parties have  executed  this  Restated  Agreement  effective the date first
written above.


                                        NEXEN INC.


                                        Per: (signed)
                                             ----------------------------------

                                        Per: (signed)
                                             ----------------------------------

SIGNED, SEALED & DELIVERED
in the presence of


(signed)                                (signed)
----------------------------------      -----------------------------------
WITNESS                                 TIMOTHY THOMAS



<PAGE>


                                  SCHEDULE "A"
                                  ------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                      EXECUTIVE BENEFIT PLAN ENTITLEMENTS

In order to  receive  the  entitlements  referred  to in the  Article 7 of this
Restated  Agreement,  the Executive shall execute the attached  Release,  fully
releasing  the  Corporation   from  all  further  claims  in  relation  to  the
Executive's  employment or Employment Benefits and the termination thereof upon
payment  of the  remuneration  and  benefits  referred  to in Article 7 of this
Restated Agreement.  The attached Release shall not, however,  require that the
Executive  relinquish  or release any rights to indemnity  which the  Executive
may,  as an officer or director of the  Corporation  or any of its  Affiliates,
Associates  and  Subsidiaries,  have as against the  Corporation  or any of its
Affiliates,  Associates  and  Subsidiaries,  for costs,  charges  and  expenses
reasonably  incurred  by the  Executive  in respect of any civil,  criminal  or
administrative  action or  proceeding to which the Executive is made a party by
reason of being or having been a director or officer of the  Corporation or any
of its Affiliates, Associates and Subsidiaries, where:

         (a)    the Executive has acted  honestly and in good faith with a view
                to  the  best  interests  of  the  Corporation  or  any  of its
                Affiliates, Associates and Subsidiaries; and

         (b)    in  the  case  of  a  criminal  or  administrative   action  or
                proceeding  enforced by a monetary  penalty,  the Executive had
                reasonable  grounds for believing the  Executive's  conduct was
                lawful.





<PAGE>



                                 FINAL RELEASE
                                 -------------


KNOW ALL MEN BY THESE PRESENTS that I, TIMOTHY THOMAS,  of the City of Calgary,
in the Province of Alberta,  in  consideration  of the amounts provided in that
certain  Amended  and  Restated  Agreement  Respecting  Change of  Control  and
Executive Benefit Plan Entitlements (the "Restated  Agreement") dated as of the
______ day of  ____________,  2008 between  myself and NEXEN INC. and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged,  do for myself,  my executors and assigns hereby remise,  release
and  forever  discharge  the  Corporation,  and  any  associated,   affiliated,
predecessor  or parent  corporation  of the  Corporation  and their present and
former directors,  officers, agents and employees (the "Releasees"),  including
each of their respective  successors,  heirs,  administrators and assigns, from
all manner of actions, causes of action, debts, obligations,  covenants, claims
or demands,  whatsoever  which I may ever have had, now have, or can,  shall or
may  hereafter  have  against  the  Releasees  or any of them,  by reason of or
arising  out of any  cause,  matter  or thing  whatsoever  done,  occurring  or
existing up to and  including the present date and, in  particular,  without in
any way restricting  the generality of the foregoing,  in respect of all claims
of any nature  whatsoever,  past,  present or future,  directly  or  indirectly
related to or arising out of or in  connection  with my  relationship  with the
Releasees,  as an employee,  officer or  director,  and the  termination  of my
employment  from the  Corporation  including,  but not  limited  to, any claims
related to any  entitlement  I may have or may have had to any payment or claim
either at common law or under the  EMPLOYMENT  STANDARDS  CODE,  HUMAN  RIGHTS,
CITIZENSHIP  AND  MULTICULTURALISM  ACT or  any  other  applicable  legislation
governing or related to my employment with the Releasees.

AND FOR THE SAID CONSIDERATION, I, TIMOTHY THOMAS, represent and warrant that I
have not assigned to any person, firm or corporation any of the actions, causes
of  action,  claims,  suits,  executions  or  demands  which I release  by this
Release,  or with  respect  to which I agree  not to make any claim or take any
proceeding herein.

IT IS FURTHER  ACKNOWLEDGED  that the payment to me includes full  compensation
and  consideration for the loss of my employment  benefits,  as provided by the
Releasees, and that all of my employment benefits and privileges shall cease on
the  date of  termination  of my  employment,  except  as  otherwise  expressly
provided in the Restated Agreement.  I further acknowledge that I have received
all benefits due to me and have no further claim against the Releasees for such
benefits. I further accept sole responsibility to replace such benefits which I

<PAGE>
                                     - 2 -


wish to continue or to exercise  conversion  privileges  where  applicable with
respect to such benefits and, in  particular  any life  insurance and long-term
disability benefits.  In the event that I become disabled following termination
of my  employment,  I covenant not to sue the  Releasees for insurance or other
benefits  or loss of same and hereby  release  the  Releasees  from any and all
further obligations or liabilities arising therefrom.

Notwithstanding  anything contained herein, this Release shall not extend to or
affect,  or constitute a release of, my right to sue,  claim against or recover
from the  Releasees  and shall not  constitute  an  agreement  to refrain  from
bringing, taking or maintaining any action against the Releasees in respect of:

         (a)    any  corporate  indemnity  existing  by  statute,  contract  or
                pursuant to any of the constating  documents of the Corporation
                provided in my favour in respect of my having acted at any time
                as a director, officer or both of the Corporation;

         (b)    my entitlement  to any insurance  maintained for the benefit or
                protection of the directors and/or officers of the Corporation,
                including   without   limitation,   directors'   and  officers'
                liability insurance; or

         (c)    my entitlement to any amounts or  compensation  due to me under
                the terms of my employment pursuant to the Restated Agreement.

IT IS  HEREBY  AGREED  that the  terms of the  Restated  Agreement  and of this
Release will be kept  confidential.  No party hereto shall communicate any such
terms to any third  party under any  circumstances  whatsoever,  excepting  any
necessary  communication with my legal and financial advisors,  as required, on
the express condition that they maintain the confidentiality  thereof,  and any
disclosure which is required by law,  although either party shall be at liberty
to  disclose to third  parties  that a mutually  acceptable  Release was agreed
upon.  The  invalidity  and  unenforceability  of any provision of this Release
shall not affect the validity or  enforceability of any other provision of this
Release, which shall remain in full force and effect.


<PAGE>
                                     - 3 -


I HEREBY  DECLARE that I have read all of this Release,  fully  understand  the
terms of this Release and voluntarily accept the consideration stated herein as
the sole  consideration  for this  Release for the purpose of making a full and
final settlement with the Releasees.  I further  acknowledge and confirm that I
have been given an adequate period of time to obtain  independent legal counsel
regarding  the  meaning  and  the  significance  of the  terms  herein  and the
covenants mutually exchanged.

IT IS HEREBY AGREED THAT as a term of the termination of my employment from the
Corporation, and in consideration of the amount noted above, I hereby resign as
officer and director of the Corporation and its affiliates.

IN  WITNESS  WHEREOF,  I have  hereunto  set my hand and seal this _____ day of
______________ in the year _________.




----------------------
TIMOTHY THOMAS



----------------------
WITNESS (signature)



----------------------
WITNESS (print name)



<PAGE>


                                 SCHEDULE "B-1"
                                 --------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                      EXECUTIVE BENEFIT PLAN ENTITLEMENTS
          METHODOLOGY AND ASSUMPTIONS FOR DETERMINING SETTLEMENT VALUE


PURPOSE

In  accordance  with the terms of the Restated  Agreement,  the purpose of this
Schedule "B-1" is to outline the calculation  approach such that, after tax has
been paid on a lump sum settlement  value, the remaining balance is intended to
be sufficient to provide after-tax monthly payments equivalent to the after-tax
monthly  payments  the  Executive  would have  received  under the terms of the
Executive Benefit Plan as provided for under this Restated Agreement.

OVERVIEW FOR DEFINED BENEFIT PENSION

The  following  outlines the actuarial  methods,  assumptions  and  calculation
process to be used in determining the lump sum settlement  value of the defined
benefit pension  entitlements  under the Executive Benefit Plan when settlement
occurs in accordance with Section 10 of the Restated Agreement.  Section 300 of
the Income Tax  Regulations  establishes  the procedure  applicable in using an
after-tax lump sum to purchase a prescribed annuity:

1.       A  prescribed  annuity  payment  consists of two  components:  (a) the
         deemed  capital  element  of the  annuity  payment  on which no tax is
         payable, and (b) the deemed non-capital portion of the annuity payment
         which is taxed at the marginal rate.

2.       The capital portion of each future annuity payment is considered to be
         a return of the original after-tax lump sum amount.

3.       The  non-capital  portion  of each  annuity  payment  is assumed to be
         provided by the investment  return on the original  after-tax lump sum
         amount and has therefore not yet been taxed.

4.       A constant  percentage of each future payment is deemed to be a return
         of the original lump sum capital.

CALCULATION METHODOLOGY

1.       Equivalent after-tax payments:

a.       Determine initial gross annual pension entitlement under the Executive
         Benefit Plan.

b.       Determine  after-tax  annual pension  entitlement  under the Executive
         Benefit  Plan based on  Individual  Tax Rate as  defined  in  Schedule
         "B-1".


<PAGE>
                                     - 2 -


c.       Determine the capital element based on the  non-indexed  present value
         of the pension payments divided by life expectancy.

d.       Determine  the monthly  payment  which  provides an after-tax  pension
         equal to the after-tax pension  determined in 1.b. above in accordance
         with the prescribed annuity methodology.

2.       Present value of periodic payments from 1. above:

a.       Determine  the present value of the pension  determined in 1.d.  above
         using the  assumptions  described  below in this Schedule  "B-1".  For
         greater certainty,  the value of the post-retirement  indexation is to
         be reflected in determining  the present value of the accrued  pension
         entitlement in respect of post-1992  service,  and any accrued pension
         in respect of service granted during the Severance Period.

3.       Tax adjustment:

a.       Gross-up the present value determined in 2.a. above to reflect the tax
         assumed to be required to be paid on the lump sum.

b.       Gross-up  the  amount  determined  in 3.a.  above to  reflect  the tax
         assumed to be required to be paid on investment earnings in respect of
         the lump sum  payment  during  the  deferral  period  prior to assumed
         pension commencement, if any.

4.       Equivalent present value after tax as the after-tax monthly payments:

a.       The amount  determined in 3.b.  above shall be the lump sum settlement
         value of the Executive's pension entitlement.

ASSUMPTIONS

Interest Discount Rate:

 --  during deferral period                Yield  on  long-term  Government  of
                                           Canada  bonds  as  published  in the
                                           Bank of Canada Review,  described in
                                           CANSIM   series    V122544   (or   a
                                           successor   series)   for  the  last
                                           trading  Wednesday at the end of the
                                           month immediately preceding the date
                                           of calculation, rounded down to next
                                           lower 0.5.

 --  after assumed pension commencement    Yield  on  long-term  Government  of
                                           Canada  bonds  as  published  in the
                                           Bank of Canada Review,  described in
                                           CANSIM   series    V122544   (or   a
                                           successor   series)   for  the  last
                                           trading  Wednesday at the end of the
                                           month immediately preceding the date
                                           of calculation, rounded down to next
                                           lower 0.5,

                                           less


<PAGE>
                                     - 3 -


                                           assumed escalation of pensions after
                                           retirement.

Increase in Consumer Price Index:          Yield  on  long-term   Government  of
                                           Canada bonds as published in the Bank
                                           of Canada Review, described in CANSIM
                                           series   V122544   (or  a   successor
                                           series)   for   the   last    trading
                                           Wednesday  at the  end  of the  month
                                           immediately  preceding  the  date  of
                                           calculation,

                                           less

                                           Yield  on  long-term  Government  of
                                           Canada   Real   Return    bonds   as
                                           published  in  the  Bank  of  Canada
                                           Review,  described in CANSIM  series
                                           V122553 (or a successor  series) for
                                           the last  trading  Wednesday  at the
                                           end   of   the   month   immediately
                                           preceding the date of calculation.

                                           The result of the difference is then
                                           rounded up to the next highest 0.5%.


Escalation of Pensions After Retirement:   75%  of  CPI,   less   1%   (minimum
                                           increase  25% of CPI).  Applies only
                                           to  benefits   accrued  for  service
                                           after December 31, 1992.

Mortality:

 --  for life expectancy                   1994 Uninsured  Pensioner  Mortality
                                           Table  with  mortality  improvements
                                           projected  to 15  years  beyond  the
                                           date of termination.

 --  for present values

      o  prior to assumed pension          Nil.
         commencement

      o  after assumed pension             1994 Uninsured  Pensioner  Mortality
         commencement                      Table  with  mortality  improvements
                                           projected  15 years  beyond the date
                                           of termination.

Marital Status:                            Actual status at date of terminaton.



 Age of Spouse:                            Based on actual date of birth.


<PAGE>
                                     - 4 -


Individual Tax Rate:                       Maximum individual marginal tax rate
                                           for    employee's     province    of
                                           employment    at   the    date    of
                                           termination.



<PAGE>

                                 SCHEDULE "B-2"
                                 --------------

                         AMENDED AND RESTATED AGREEMENT
                        RESPECTING CHANGE OF CONTROL AND
                      EXECUTIVE BENEFIT PLAN ENTITLEMENTS

METHODOLOGY  AND ASSUMPTIONS FOR DETERMINING THE AMOUNT TO BE SECURED OR FUNDED
IN ACCORDANCE  WITH SECTION 10 BASED ON THE  METHODOLOGY  DESCRIBED IN SCHEDULE
"B-1"


PURPOSE

The purpose of this Schedule "B-2" is to provide the actuarial  methodology and
assumptions  for  determining  the amount to be secured or funded in accordance
with Section 10 of the Restated Agreement.

METHODOLOGY

The settlement methodology is described in Schedule B-1.

The funding methodology applicable to the Executive Benefit Plan Obligations is
based on the following:

1.       Estimate the accrued pension  payable from the Executive  Benefit Plan
         as at the Valuation Date.

2.       Assume  that the  assets of the plan are to be  invested  in long term
         Government  of Canada  bonds and  subject  to the 50%  refundable  tax
         applicable to retirement compensation arrangements.

3.       Determine the present value of the amounts in 1 through 2 above.

4.       Estimate the  settlement  value that could be paid in accordance  with
         the methodology and assumptions described in Schedule B-1.

5.       The  funding   amount  in  respect  of  the  Executive   Benefit  Plan
         Obligations   shall  be  the  greater  of  the  amount  determined  in
         accordance with 1 through 3 above and the amount in 4 above.

ASSUMPTIONS

Interest Discount Rate:

--  during deferral period                 Yield  on  long-term  Government  of
                                           Canada  bonds  as  published  in the
                                           Bank of Canada Review,  described in
                                           CANSIM   series    V122544   (or   a
                                           successor   series)   for  the  last
                                           trading  Wednesday at the end of the
                                           month   immediately   preceding  the
                                           Anniversary  Date,  rounded  down to
                                           next lower 0.5.


<PAGE>
                                     - 2 -

--  after assumed pension commencement     Yield  on  long-term  Government  of
                                           Canada  bonds  as  published  in the
                                           Bank of Canada Review,  described in
                                           CANSIM   series    V122544   (or   a
                                           successor   series)   for  the  last
                                           trading  Wednesday at the end of the
                                           month   immediately   preceding  the
                                           Anniversary  Date,  rounded  down to
                                           next   lower  0.5  ,  less   assumed
                                           escalation    of   pensions    after
                                           retirement.

Increase in  Consumer  Price Index:        Yield  on  long-term  Government  of
                                           Canada  bonds  as  published  in the
                                           Bank of Canada Review,  described in
                                           CANSIM   series    V122544   (or   a
                                           successor   series)   for  the  last
                                           trading  Wednesday at the end of the
                                           month   immediately   preceding  the
                                           Anniversary Date,

                                           less

                                           Yield  on  long-term  Government  of
                                           Canada   Real   Return    bonds   as
                                           published  in  the  Bank  of  Canada
                                           Review,  described in CANSIM  series
                                           V122553 (or a successor  series) for
                                           the last  trading  Wednesday  at the
                                           end   of   the   month   immediately
                                           preceding the Anniversary Date.

                                           The result of the difference is then
                                           rounded up to the next highest 0.5%.

Escalation of Pensions After Retirement:   75%  of  CPI,   less   1%   (minimum
                                           increase  25% of CPI).  Applies only
                                           to  benefits   accrued  for  service
                                           after December 31, 1992.

Mortality:

-- for life expectancy                     1994 Uninsured  Pensioner  Mortality
                                           Table  with  mortality  improvements
                                           projected  to 15  years  beyond  the
                                           Calculation Date.

-- for present values

   o  prior to assumed pension
      commencement                         Nil.

   o  after assumed pension commencement   1994 Uninsured  Pensioner  Mortality
                                           Table  with  mortality  improvements
                                           projected   15  years   beyond   the
                                           Calculation Date.


<PAGE>
                                     - 3 -


Marital Status:                            Actual status at the Anniversary.

Age of Spouse:                             Based on actual date of birth.

Individual Tax Rate:                       Maximum individual marginal tax rate
                                           for    employee's     province    of
                                           employment at the Anniversary Date

Bonus:                                     Target bonus % applied to the salary
                                           rate at the Valuation Date

Investment return:                         Yield  on  long-term  Government  of
                                           Canada  bonds  as  published  in the
                                           Bank of Canada Review,  described in
                                           CANSIM   series    V122544   (or   a
                                           successor   series)   for  the  last
                                           trading  Wednesday at the end of the
                                           month   immediately   preceding  the
                                           Anniversary  Date  rounded  down  to
                                           next lower 0.5%, and then divided by
                                           2

Decrements:                                None  assumed  prior to  Calculation
                                           Date

Eligibility for Pensions:                  100% vested

Pension Commencement Age:

--   eligible for subsidized early         Payable  at  the  completion  of the
     retirement on the Calculation Date    Severance  Period.  Payable  at  the
     (i.e., age 55 and 10 years of         Calculation  Date  for  purposes  of
     continuous service)                   determining   the  amount   required
                                           under Section 10.6(e).

--   not eligible for early retirement     Deferred to age 60 or the end of the
     on the Calculation Date               Severance  Period if later.  Payable
                                           at   age   60   for    purposes   of
                                           determining   the  amount   required
                                           under Section 10.6(e).

Fluctuation reserve (1)                    15% of the pension obligations

Cost of borrowing to settle the            Yield  on one  month  Government  of
obligations:                               Canada  Treasury  Bills as published
                                           in  the  Bank  of   Canada   Review,
                                           described in CANSIM  series  V122529
                                           (or a successor series) for the last
                                           trading  Wednesday at the end of the
                                           month   immediately   preceding  the
                                           Anniversary Date,  rounded up to the
                                           next higher 0.25%, plus 1.50%

<PAGE>
                                     - 4 -




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


NOTES:

(1)  Referred to by Section 10.5(g), Section 10.6(e)(viii) and 10.6(e)(x).  The
     15% load is intended to provide a reserve for a potential  decrease in the
     Interest  Discount Rate in  combination  with  potential  increases in the
     Consumer Price Index for an aggregate change of 1.0%.





<PAGE>

                                  SCHEDULE "C"
                                  ------------

          AMENDED AND RESTATED AGREEMENT RESPECTING CHANGE OF CONTROL
                    AND EXECUTIVE BENEFIT PLAN ENTITLEMENTS
                   ESTIMATED(1) ENTITLEMENT TO COMPENSATION
                PURSUANT TO ARTICLE 7 OF THE RESTATED AGREEMENT

--------------------------------------------------------------------------------
EMPLOYEE - TIMOTHY THOMAS
--------------------------------------------------------------------------------
Base Salary                                                             $814,000
--------------------------------------------------------------------------------
Bonus Target Value                                                      $366,300
--------------------------------------------------------------------------------
Benefits Uplift                                                         $105,820
--------------------------------------------------------------------------------
Car Allowance                                                            $38,400
--------------------------------------------------------------------------------
Savings Plan                                                             $48,840
--------------------------------------------------------------------------------
Financial Counselling Services                                           $10,500
--------------------------------------------------------------------------------
Security Monitoring Services                                              $2,400
--------------------------------------------------------------------------------

TOTAL VALUE                                                           $1,386,260
--------------------------------------------------------------------------------
ADDITIONAL LUMP SUM SETTLEMENT VALUE OF PENSION(2)                    $1,571,410
--------------------------------------------------------------------------------
TOTAL ESTIMATED ENTITLEMENT                                           $2,957,670
--------------------------------------------------------------------------------

In addition to the above,  Section  7.1(c) of the  Restated  Agreeme  Executive
Outplacement counselling to be provided by a firm selected by the Executive, at
a cost to the Corporation not to exceed $25,000.

IN ADDITION to the above pension entitlement under the Agreement, the Executive
has the following  pension  entitlements  under the Defined Benefit  Registered
Pension Plan and Executive  Benefit Plan. As is the case with the figures shown
above,  these  values  are  estimated  values (as of April 1, 2008) and are for
illustrative  purposes only. Actual values will be calculated as of the date of
the entitlement or payment in accordance  with the Defined  Benefit  Registered
Pension Plan and the Executive Benefit Plan, respectively, and therefore may be
subject to change.

o    Accrued Annual Defined Benefit Pension Entitlement                $24,889
     (Registered Pension Plan)(3)

o    Estimated Lump Sum Transfer Value of Registered                  $277,509
     Pension Plan(4)

o    Estimated Lump Sum Value of Executive                            $863,571
     Benefit Plan(4)




(1)  As stated in Section 7.1 of the Restated Agreement, the above calculations
     represent  only the current  estimated  value (as of April 1, 2008) of the
     Executive's   entitlement  to  compensation  upon  a  Change  of  Control.
     Accordingly,  the above  calculations are for illustrative  purposes only.

(2)  Calculated in accordance with Section 7.1(b) of the Restated Agreement.

     -   Adjustment to EBP lump sum value to reflect settlement $678,567.

     -   Additional  settlement  value of pension  accrued during the severance
         period upon a change of control $892,843.

(3)  Deferred benefit payable from age 60.

(4)  Based on the Standards of Practice for Determining Pension Commuted Values
     approved by the Canadian Institute of Actuaries using rates applicable for
     April 2008 terminations.