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                                                                    EXHIBIT 10.8







              SUPPLEMENTAL BENEFIT PLAN FOR DESIGNATED EMPLOYEES OF
                  BOWATER INCORPORATED AND AFFILIATED COMPANIES




                             AS AMENDED AND RESTATED
                           EFFECTIVE FEBRUARY 26, 1999


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                                    PREAMBLE


Establishment of Prior Plans

        The Supplemental Benefit Plan of Bowater Incorporated (the "Bowater
        Plan") was established effective December 31, 1971, for the benefit of
        designated employees of Bowater Incorporated. The Supplemental Benefit
        Plan for Designated Employees of Bowater Southern Paper Company and
        Bowater Carolina Company, Divisions of Bowater Incorporated, and other
        Participating Divisions of Bowater Incorporated (the "Southern Plan")
        was established effective July 1, 1981, for the benefit of designated
        employees of Bowater Southern Paper Company, Bowater Carolina Company
        and certain other divisions of Bowater Incorporated.

Consolidation and Restatement of Plans

        Each of the Bowater Plan and the Southern Plan provided that it could be
        amended at any time and from time to time. The Bowater Plan and the
        Southern Plan were amended and restated in their entirety effective
        August 22, 1990. From and after the effective date thereof, the Bowater
        Plan and the Southern Plan were deemed to be one plan. Anyone who was a
        participant under either of these prior plans on the effective date of
        this consolidation and restatement was a participant in this
        Supplemental Benefit Plan for Designated Employees of Bowater
        Incorporated and Affiliated Companies (the "Plan"). The continued
        eligibility of such persons to participate in the Plan is determined by
        the provisions hereof. The Plan was restated in its entirety as of
        November 1, 1995, in order to incorporate previous amendments and to
        clarify the meaning of certain provisions. The Plan is now being
        restated in its entirety as of February 26, 1999, in order to
        incorporate amendments that have been previously adopted.

Objective of Plan

        The purpose of the Plan is to provide an inducement to key employees of
        Bowater Incorporated (the "Corporation") and key employees of affiliated
        companies to which the Board of Directors of Bowater Incorporated
        extends the Plan to remain in the employment of the Employer (as
        hereinafter defined) by providing retirement benefits supplemental to
        those available under the Corporation's basic qualified benefit plans.


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                                Table of Contents

                                                                            Page

Preamble          ...........................................................i


ARTICLE I:  DEFINITIONS

        1.01      "Acquiring Person".........................................1
        1.02      "Affiliate" and "Associate"................................1
        1.03      "Affiliated Company".......................................1
        1.04      "Age" .....................................................1
        1.05      "Beneficial Owner".........................................1
        1.06      "Board"....................................................2
        1.07      "Cause"................................................... 2
        1.08      "Change in Control"........................................2
        1.09      "Child or Children" .......................................3
        1.10      "Code".................................................... 3
        1.11      "Committee"................................................3
        1.12      "Compensation".............................................3
        1.13      "Continuing Director"..................................... 3
        1.14      "Corporation"..............................................3
        1.15      "Disability"...............................................3
        1.16      "Effective Date"...........................................3
        1.17      "Eligible Dependents" .....................................4
        1.18      "Employee" ................................................4
        1.19      "Employer".................................................4
        1.20      "ERISA"....................................................4
        1.21      "Exchange Act".............................................4
        1.22      "Final Average Monthly Compensation"...................... 4
        1.23      "Normal Retirement Age"....................................4
        1.24      "Normal Retirement Date" ..................................4
        1.25      "Other Benefits" ..........................................4
        1.26      "Participant"..............................................4
        1.27      "Person".................................................. 4
        1.28      "Plan".....................................................5
        1.29      "Plan Administrator" ......................................5
        1.30      "Plan Name"................................................5
        1.31      "Retirement".............................................. 5
        1.32      "Spouse" ..................................................5
        1.33      "Years of Service"  .......................................5


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ARTICLE 2:  PARTICIPATION AND ELIGIBILITY FOR BENEFITS

        2.01      Participation............................................. 5
        2.02      Pension Plan Contingent Annuitant Option ..................6
        2.03      Effect on Other Plans .....................................6

ARTICLE 3:  AMOUNT OF RETIREMENT INCOME

        3.01      Normal Retirement Benefits ................................6
        3.02      Early Retirement Reduction................................ 6
        3.03      Benefit Payments ..........................................6
        3.04      Calculation of Deductions for Other Benefits ..............7

ARTICLE 4:  DEATH AND DISABILITY BENEFITS

        4.01      Spouse's Pre-Retirement Death Benefits.................... 7
        4.02      Spouse's Post-Retirement Death Benefits ...................7
        4.03      Children's Death Benefits .................................8
        4.04      Disability Benefits .......................................8

  ARTICLE 5:  GROUP MEDICAL INSURANCE AND LIFE INSURANCE

        5.01      Medical Insurance......................................... 9
        5.02      Life Insurance............................................10

ARTICLE 6:  COVENANTS OF EMPLOYEE

        6.01      During Continuation of Employment.........................11
        6.02      Following Termination of Employment.......................11
        6.03      Remedy for Breach  .......................................12

ARTICLE 7:  OBLIGATION TO PAY BENEFITS

        7.01      Employer Obligated to Pay.................................12
        7.02      Amendment or Termination of the Plan......................12
        7.03      Subsequent to a Change in Control of the Corporation......13
        7.04      Transfers of Employment...................................13

ARTICLE 8:  GENERAL PROVISIONS

        8.01      Limitation of Rights of the Employee......................14
        8.02      Discharge of Obligations..................................14
        8.03      No Assignment of Benefits.................................15
        8.04      Administrative Powers Relating to Payment.................15

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        8.05      Multiple Claimants .......................................15
        8.06      Administration............................................15
        8.07      Indemnification...........................................16
        8.08      Expenses..................................................16
        8.09      Funding ..................................................16
        8.10      Payment of Participant's Expenses.........................16
        8.11      Governing Law ............................................16
        8.12      Severability .............................................17
        8.13      Named Fiduciary ..........................................17

ARTICLE 9:  CLAIMS PROCEDURE

        9.01      Submission of Claims .....................................17
        9.02      Written Notice of Denied Claim ...........................17
        9.03      Review of Decision Denying Claims ........................17
        9.04      Hearing ..................................................17
        9.05      Written Decision of Plan Administrator ...................17

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                             ARTICLE 1: DEFINITIONS


        Unless the context clearly indicates otherwise, the following words and
phrases, when used herein with an initial capital letter, shall have the
following meanings. Wherever applicable the masculine pronoun shall include the
feminine pronoun and the singular shall include the plural.

1.01       "ACQUIRING PERSON" shall mean the Beneficial Owner, directly or
           indirectly, of Common Stock representing 20% or more of the combined
           voting power of the Corporation's then outstanding securities, not
           including (except as provided in clause (i) of the next sentence)
           securities of such Beneficial Owner acquired pursuant to an agreement
           allowing the acquisition of up to and including 50% of such voting
           power approved by two-thirds of the members of the Board who are
           Board members before the Person becomes Beneficial Owner, directly or
           indirectly, of Common Stock representing 5% or more of the combined
           voting power of the Corporation's then outstanding securities.
           Notwithstanding the foregoing, (i) securities acquired pursuant to an
           agreement described in the preceding sentence will be included in
           determining whether a Beneficial Owner is an Acquiring Person if,
           subsequent to the approved acquisition, the Beneficial Owner acquires
           5% or more of such voting power other than pursuant to such an
           agreement so approved; and (ii) a Person shall not be an Acquiring
           Person if such Person is eligible to and files a Schedule 13G with
           respect to such Person's status as a Beneficial Owner of all Common
           Stock of the Corporation of which the Person is a Beneficial Owner.

1.02       "AFFILIATE AND ASSOCIATE" shall have the respective meanings ascribed
           to such terms in Rule 12b-2 of the General Rules and Regulations
           under the Securities and Exchange Act of 1934.

1.03       "AFFILIATED COMPANY" shall mean any corporation that is a member of a
           controlled group of corporations (as defined in Code Section 414(b))
           which includes the Corporation; any trade or business (whether or not
           incorporated) which is under common control (as defined in Code
           Section 414(c)) with the Corporation; any organization (whether or
           not incorporated) which is a member of an affiliated service group
           (as defined in Code Section 414(m)) that includes the Corporation;
           and any other entity required to be aggregated with the Corporation
           pursuant to regulations under Code Section 414(o). With respect to
           periods prior to July 23, 1984, Affiliated Company includes any
           corporation that would have been an Affiliated Company prior to the
           separation under United Kingdom law of Bowater Incorporated from
           Bowater plc.

1.04       "AGE" shall mean an Employee's attained age in years and completed
           months.

1.05       "BENEFICIAL OWNER" of Common Stock means (i) a Person who
           beneficially owns such Common Stock, directly or indirectly, or (ii)
           a Person who has the right to acquire such Common Stock (whether such
           right is exercisable immediately or only with the passage of time)
           pursuant to any agreement, arrangement or understanding (whether or
           not in writing) or upon the exercise of conversion rights, exchange
           rights, warrants, options or otherwise.



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1.06       "BOARD" shall mean the Board of Directors of the Corporation, as
           constituted from time to time.

1.07       "CAUSE" shall mean the Participant's gross negligence or willful
           misconduct, which negligence or misconduct has a demonstrable and
           material adverse effect upon the Corporation or an Affiliated
           Company, provided that the Plan Administrator or the Employer shall
           have given the Participant written notice of the alleged negligence
           or misconduct and the Participant shall have failed to cure the
           negligence or misconduct within thirty (30) days after receipt of the
           notice. The Participant shall be deemed to have been terminated for
           Cause effective upon the effective date stated in a written notice of
           termination delivered by the Plan Administrator or the Employer to
           the Participant setting forth in reasonable detail the facts and
           circumstances claimed to provide the basis for the Participant's
           termination.

1.08       "CHANGE IN CONTROL" shall be deemed to have occurred upon:

           (a)        the date that any Person is or becomes an Acquiring
                      Person;

           (b)        the date that the Corporation's shareholders approve a
                      merger, consolidation or reorganization of the Corporation
                      with another corporation or other Person, unless,
                      immediately following such merger, consolidation or
                      reorganization, (i) at least 50% of the combined voting
                      power of the outstanding securities of the resulting
                      entity would be held in the aggregate by the shareholders
                      of the Corporation as of such record date for such
                      approval (provided that securities held by any individual
                      or entity that is an Acquiring Person, or who would be an
                      Acquiring Person if 5% were substituted for 20% in the
                      definition of such term, shall not be counted as
                      securities held by the shareholders of the Corporation,
                      but shall be counted as outstanding securities for
                      purposes of this determination), or (ii) at least 50% of
                      the board of directors or similar body of the resulting
                      entity are Continuing Directors;

           (c)        the date the Corporation sells or otherwise transfers all
                      or substantially all of its assets to another corporation
                      or other Person, unless, immediately after such sale or
                      transfer, (i) at least 50% of the combined voting power of
                      the then-outstanding securities of the resulting entity
                      immediately following such transaction is held in the
                      aggregate by the Corporation's shareholders as determined
                      immediately prior to such transaction (provided that
                      securities held by any individual or entity that is an
                      Acquiring Person, or who would be an Acquiring Person if
                      5% were substituted for 20% in the definition of such
                      term, shall not be counted as securities held by the
                      shareholders of the Corporation, but shall be counted as
                      outstanding securities for purposes of this
                      determination), or (ii) at least 50% of the board of
                      directors or similar body of the resulting entity are
                      Continuing Directors; or

           (d)        the date on which less than 50% of the total membership of
                      the Board consists of Continuing Directors.



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1.09       "CHILD OR CHILDREN" of the Participant shall mean any child or
           children who are issue of any marriage contracted by the Participant
           (either before or after their birth) or who have been legally adopted
           by the Participant by the age of twenty-one (21).

1.10       "CODE" shall mean the Internal Revenue Code of 1986, and any
           amendments thereto.

1.11       "COMMITTEE" shall mean the Human Resources and Compensation Committee
           of the Board of Directors of the Corporation.

1.12       "COMPENSATION" shall mean the entire cash compensation paid to, or
           deferred for the benefit of, a Participant by the Employer as salary,
           wages, commissions, overtime pay, regular bonuses paid under the
           Bowater Incorporated Annual Incentive Plan, severance pay paid in
           periodic installments, Employer contributions made pursuant to a
           salary reduction agreement that are not includible in the gross
           income of the Participant under Code Sections 125, 401(e)(3), 402(h)
           or 403(b), and any compensation that is contributed to a plan
           maintained by an Employer on behalf of the Participant under Code
           Section 401(k), but excluding any non-cash remuneration, income
           received upon the exercise of a stock option or stock appreciation
           right, bonuses received under a long term cash incentive plan, other
           special remuneration, and any benefits and credits under this or any
           other employee benefit plan of the Employer.

1.13       "CONTINUING DIRECTOR" shall mean any member of the Board who (i) was
           a member of the Board prior to the date of the event that would
           constitute a Change in Control, and any successor of a Continuing
           Director while such successor is a member of the Board, (ii) is not
           an Acquiring Person or an Affiliate or Associate of an Acquiring
           Person, and (iii) is recommended or elected to succeed the Continuing
           Director by a majority of the Continuing Directors.

1.14       "CORPORATION" shall mean Bowater Incorporated and any successor to
           its business or assets, whether by purchase, merger, consolidation or
           otherwise.

1.15       "DISABILITY" shall mean the status of being eligible for and
           receiving the benefits provided under the Long-Term Disability Plan
           of the Participant's Employer, provided that if a Participant is
           enrolled in a Long-Term Disability Plan of the Corporation or an
           Affiliated Company and the plan is discontinued while the Participant
           is a Participant in the plan, for purposes of this Plan, the
           Participant shall be deemed disabled at the time he would have been
           eligible for benefits under the Long-Term Disability Plan in effect
           immediately prior to its termination had that plan not been
           terminated. The determination of whether and when a Participant would
           have been eligible for benefits under any terminated plan shall be
           made by the Plan Administrator in its sole discretion.

1.16       "EFFECTIVE DATE" shall mean the date on which the provisions of this
           amended and restated Plan shall be effective, which is February 26,
           1999, unless otherwise provided herein.



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1.17       "ELIGIBLE DEPENDENTS" shall mean those dependents of the Participant
           that are considered eligible to receive medical benefits under the
           Corporation's group medical benefit plan.

1.18       "EMPLOYEE" shall mean any individual employed by the Employer other
           than an independent contractor.

1.19       "EMPLOYER" shall mean the Corporation and any subsidiary or
           affiliated employer authorized by the Corporation to adopt and
           participate in this Plan.

1.20       "ERISA" shall mean the Employee Retirement Income Security Act of
           1974, as amended from time to time.

1.21       "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
           amended.

1.22       "FINAL AVERAGE MONTHLY COMPENSATION" shall mean the average of the
           Participant's Compensation for the highest thirty-six (36)
           consecutive calendar months in the last sixty (60) months immediately
           preceding his termination date and further divided by thirty-six
           (36); except that (i) if the Participant earns Compensation in fewer
           than sixty (60) months preceding his termination date, his "Final
           Average Monthly Compensation" shall be based on Compensation for the
           highest thirty-six (36) consecutive calendar months preceding his
           termination date, and (ii) if the Participant earns Compensation in
           fewer than thirty-six (36) consecutive calendar months preceding his
           termination date, his "Final Average Monthly Compensation" shall be
           based on Compensation for all months preceding his termination date.

1.23       "NORMAL RETIREMENT AGE" shall mean the day on which the Participant
           attains his sixty-fifth (65th) birthday.

1.24       "NORMAL RETIREMENT DATE" shall mean the first day of the calendar
           month coinciding with or next following the Participant's Normal
           Retirement Age.

1.25       "OTHER BENEFITS" shall mean any benefits payable to a Participant, or
           his Spouse or Children on behalf of the Participant, under the
           Bowater Incorporated Benefits Equalization Plan or under any
           qualified defined benefit pension plan of the Corporation or any
           Affiliated Company.

1.26       "PARTICIPANT" shall mean anyone who is eligible to participate in the
           Plan as provided in Article 2, and who continues to have rights or
           contingent rights to benefits payable under this Plan, subject to the
           terms and conditions of Article 6. A Participant whose employment is
           terminated for Cause shall no longer be a Participant, and his Spouse
           and Children will no longer be entitled to benefits.

1.27       "PERSON" means any individual, firm, corporation, partnership, trust
           or other entity.



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1.28       "PLAN" shall mean this Supplemental Benefit Plan for Designated
           Employees of Bowater Incorporated and Affiliated Companies, as stated
           herein, and as it may be amended from time to time.

1.29       "PLAN ADMINISTRATOR" shall mean the Committee or any successor
           appointed by the Board or its designee.

1.30       "PLAN NAME" shall be Supplemental Benefit Plan for Designated
           Employees of Bowater Incorporated and Affiliated Companies.

1.31       "RETIREMENT" shall mean the status of having terminated employment
           and being eligible for the payment of benefits either immediately or
           at some future date under any qualified defined benefit pension plans
           of the Participant's Employer and any Affiliated Company in which he
           participates, provided a Participant whose employment is terminated
           for Cause shall not be deemed to have retired for purposes of the
           Plan.

1.32       "SPOUSE" shall mean the person legally married to a Participant and
           from whom the Participant is not legally separated at the time of his
           death.

1.33       "YEARS OF SERVICE" shall mean the Participant's aggregate period of
           employment consisting of years of service and parts thereof as
           computed, for benefit accrual purposes, according to the qualified
           defined benefit pension plan of the Corporation; provided that "Years
           of Service" for an Employee who is not a Participant hereunder as of
           his termination date shall not include any period after the last date
           on which he was a Participant.

              ARTICLE 2: PARTICIPATION AND ELIGIBILITY FOR BENEFITS

2.01       PARTICIPATION: Employees of the Corporation who (i) are in salary
           grades thirty-one (31) and above, or (ii) are designated as eligible
           by the Committee, shall be Participants in the Plan. Should the Plan
           be extended to an Affiliated Company that adopts the Plan, the
           Committee shall designate which Employees of such Affiliated Company
           shall participate in the Plan. Subject to the provisions of Section
           7.04(a)(i), a Participant who ceases to be an Employee of the
           Corporation or an Affiliated Company that has adopted the Plan or who
           (a) is no longer in salary grade thirty-one (31) or above, or (b) is
           designated by the Committee as no longer eligible to participate in
           the Plan, will cease accruing benefits under the Plan, unless and
           until the Participant again becomes eligible to be a Participant in
           the Plan.

           Notwithstanding the foregoing, the Employee's Compensation shall
           continue to be included for purposes of determining his Final Average
           Monthly Compensation under Article 3.




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2.02       PENSION PLAN CONTINGENT ANNUITANT OPTION: A Participant who is
           married on the date benefits become payable under Section 3.03 must
           have elected, and not subsequently revoked, a fifty percent (50%) or
           higher contingent annuitant option (with his Spouse as contingent
           annuitant) under all qualified defined benefit pension plans of his
           Employer and any Affiliated Company in which he participates in order
           for him, his Spouse or his Children to be eligible for benefits under
           the Plan.

2.03       EFFECT ON OTHER PLANS: Although the Plan references the provisions of
           other plans established by the Corporation and its Affiliated
           Companies, the provisions of those plans will not be changed or
           enlarged hereby.

                     ARTICLE 3: AMOUNT OF RETIREMENT INCOME

3.01       NORMAL RETIREMENT BENEFITS: Subject to the provisions of Sections
           2.01, 2.02, 6.03, 7.02 and 7.04, a Participant (i) whose Retirement
           occurs on or after his Normal Retirement Date, or (ii) whose
           Retirement occurs before his Normal Retirement Date but who does not
           commence receiving benefits under the qualified defined benefit
           pension plan of his Employer or an Affiliated Employer in which he
           participates until on or after his Normal Retirement Date, shall be
           entitled to a monthly benefit equal to (a) plus (b) minus (c) below:

           (a)        Two-and-one-half percent (2-1/2%) of Final Average Monthly
                      Compensation for each Year of Service up to twenty (20)
                      Years of Service.

           (b)        One percent (1%) of Final Average Monthly Compensation for
                      each Year of Service greater than twenty (20) and up to
                      thirty (30) Years of Service.

           (c)        Any Other Benefits which may be payable in any month to
                      the Participant.

3.02       EARLY RETIREMENT REDUCTION: Subject to the provisions of Sections
           2.01, 2.02, 6.03, 7.02 and 7.04, when a Participant commences
           receiving benefits under a qualified defined benefit pension plan of
           his Employer or an Affiliated Company prior to his Normal Retirement
           Date, he also shall begin receiving the monthly benefit determined
           under paragraphs (a) and (b) of Section 3.01 as of the date of
           commencement, reduced by one-half of one percent (1/2%) for each
           month by which the commencement of benefits precedes the
           Participant's attainment of age sixty (60), less the amount
           determined under Section 3.01(c). This amount shall not be increased
           upon the Participant's attainment of age sixty (60).

3.03       BENEFIT PAYMENTS: Retirement benefits payable pursuant to this
           Article shall be payable monthly on the first day of each month
           commencing with the date on which benefit payments commence under any
           qualified defined benefit pension plan of the Participant's Employer
           or an Affiliated Company in which he participates and continuing
           through the first day of the month in which the Participant dies or
           is re-employed by the Employer.


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3.04       CALCULATION OF DEDUCTIONS FOR OTHER BENEFITS: If any Other Benefits
           shall be due to the Participant, his estate, Spouse or Children in a
           lump sum or over a period shorter or longer than the period herein
           provided with respect to payments hereunder, or at different
           intervals, or if they commence at a different time, then and in such
           case, the aggregate of all Other Benefits shall for the purposes
           hereof be actuarially converted into benefits payable over the
           monthly periods provided for payments hereunder based on the
           actuarial assumptions used in the Employer's qualified defined
           benefit pension plan covering the Participant at the time benefits
           commence hereunder in order to arrive at the deductions herein
           provided for the Other Benefits.

                    ARTICLE 4: DEATH AND DISABILITY BENEFITS

4.01       SPOUSE'S PRE-RETIREMENT DEATH BENEFITS: Subject to the provisions of
           Articles 6 and 7, the surviving Spouse of a Participant who dies
           prior to his Retirement or who, at the time of his death, was
           receiving a Disability benefit under Section 4.04 (excluding benefits
           payable pursuant to the next to the last sentence of Section 4.04),
           will be entitled to receive a monthly benefit, payable on the first
           day of each month, commencing with the month following the
           Participant's death. Payments shall cease with the payment for the
           month in which the Spouse dies.

           The amount of the Spouse's monthly benefit shall be sixty percent
           (60%) of the projected monthly benefit the Participant would have
           been entitled to receive under Section 3.01(a) and 3.01(b) calculated
           in the manner hereinafter specified and reduced by any Other Benefits
           which may be payable to the Spouse.

           For purposes of determining such projected monthly benefit, the
           Participant's rate of annual Compensation at the time of his death or
           Disability will be assumed to have remained unchanged to his Normal
           Retirement Date, and his Years of Service will be deemed to include
           the period between his date of death and his Normal Retirement Date.

4.02       SPOUSE'S POST-RETIREMENT DEATH BENEFITS: Subject to the provisions of
           Articles 6 and 7, the surviving Spouse of a Participant who dies
           subsequent to his Retirement or who, at the time of his death, was
           receiving a Retirement benefit pursuant to the next to the last
           sentence of Section 4.04, will be entitled to receive a monthly
           benefit, payable on the first day of each month commencing with the
           month following the Participant's death. Payments shall cease with
           the payment for the month in which the Spouse dies.

           In the case of a Participant who, prior to his death, had commenced
           receiving benefits under Article 3 or under the next to the last
           sentence of Section 4.04, the amount of the Spouse's monthly benefit
           shall be sixty percent (60%) of the total monthly benefit determined
           under Sections 3.01(a) and 3.01(b) (or the next to the last sentence
           of Section 4.04 where applicable) that was being paid to the
           Participant at the time of his death, reduced by the amount of any
           Other Benefits which may be payable to the Spouse.



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           In the case of a Participant who had not commenced receiving benefits
           under Article 3 or under the next to the last sentence of Section
           4.04, the amount of the Spouse's monthly benefit shall be sixty
           percent (60%) of (i) the total monthly benefit determined under
           Section 3.01(a) and 3.01(b) reduced by (ii) one-half of one percent
           (1/2%) for each month by which the date of the Participant's death
           precedes the date on which the Participant would have attained age
           sixty (60), less the amount of any Other Benefits which may be
           payable to the Spouse.

4.03       CHILDREN'S DEATH BENEFITS: On the death of a Spouse who was receiving
           benefits under Section 4.01 or Section 4.02, the Participant's
           Children who are under the age of twenty-one (21) will be entitled to
           receive collectively a monthly benefit, payable on the first day of
           each month commencing with the month following the Spouse's death.

           Notwithstanding the provisions of Section 3.04 hereof, subject to the
           provisions of Articles 6 and 7, on the death of a Participant who is
           not survived by a Spouse, the Participant's Children who are under
           the age of twenty-one (21) will be entitled to receive collectively a
           monthly benefit, payable on the first day of each month commencing
           with the month following the Participant's death.

           The amount of the Childrens' monthly benefit payable under this
           Section 4.03 shall be twenty percent (20%) of the monthly benefit the
           Spouse was receiving, or would have been entitled to receive (in
           instances where there is no surviving Spouse), under Section 4.01 or
           Section 4.02, as the case may be, multiplied by the number of
           Children under age twenty-one (21) during the month. The maximum
           Childrens' monthly benefit shall, however, in no case be more than
           one hundred percent (100%) of the amount of the benefit to which the
           Participant's surviving Spouse was or would have been entitled.
           Benefits payable to Children of a Participant pursuant to this
           Section shall be reduced proportionately as each Child attains the
           age of twenty-one (21) years or sooner dies and shall terminate with
           the payment on the first day of the month in which the last remaining
           Child of the Participant attains the age of twenty-one (21) years or
           sooner dies.

           The benefits that a Child or Children are entitled to receive shall
           accrue and be paid for the collective use and benefit of the Child or
           Children under age twenty-one (21) to their duly appointed
           conservator(s), guardian(s) or trustee(s) where applicable. If the
           Children have different fiduciaries representing them, the payment to
           each fiduciary on behalf of the Children shall be proportionate to
           the number of Children each fiduciary represents. The receipt by the
           fiduciaries of the amount of the benefit paid shall constitute a full
           and complete discharge therefor to the Employer.

4.04       DISABILITY BENEFITS: In the event of the Disability of a Participant,
           the Participant shall be entitled to a monthly supplemental
           disability income benefit payable on the first day of each month
           commencing with the month following the date of Disability equal to
           (a) or (b) below:

           (a)        If the Participant is enrolled in and declared disabled
                      under the Employer's Long-Term Disability Plan, forty
                      percent (40%) of that portion of the



                                       8
<PAGE>   14

                      Participant's Compensation as of the date of such
                      Disability in excess of the maximum Compensation covered
                      by the Long-Term Disability Plan divided by twelve (12),
                      less any Other Benefits that may be payable in any month
                      to the Participant as a consequence of his Disability.

           (b)        If the Participant was enrolled in his Employer's
                      Long-Term Disability Plan and the plan was discontinued
                      while the Participant was a Participant in the plan, forty
                      percent (40%) of that portion of the Participant's
                      Compensation as of the date of the termination of the
                      Long-Term Disability Plan in excess of the maximum
                      Compensation covered by the Long-Term Disability Plan as
                      of the termination date divided by twelve (12), less any
                      Other Benefits that may be payable in any month to the
                      Participant as a consequence of his Disability to the
                      extent Other Benefits had accrued as of the date of
                      termination of the Long-Term Disability Plan.

           Supplemental disability income shall continue until the monthly
           payment preceding the earliest of the Participant's Normal Retirement
           Date, or death, or the date on which the Participant's Disability
           ends. Upon the Participant's reaching his Normal Retirement Date, the
           payments pursuant to this Section 4.04 shall cease, and the
           Participant shall be entitled to retirement benefits calculated in
           accordance with the provisions of Section 3.01 based upon his Final
           Average Monthly Compensation on the date of such Disability and his
           Years of Service to his Normal Retirement Date.

           A Participant who is eligible for, but not enrolled in, his
           Employer's Long-Term Disability Plan shall not be entitled to a
           Disability benefit under the Plan.

              ARTICLE 5: GROUP MEDICAL INSURANCE AND LIFE INSURANCE

5.01       MEDICAL INSURANCE: (a) If, under the group medical benefit plan
           maintained by the Employer, a Participant has in effect medical
           insurance as of the date of Retirement and is entitled to the
           immediate payment of annuity benefits under his Employer's qualified
           defined benefit pension plan:

                      (i)        After Retirement of the Participant and until
                                 midnight ending the day prior to the
                                 Participant's 65th birthday, the Employer will
                                 continue to provide to the Participant at its
                                 sole cost and expense the medical insurance and
                                 other medical benefits in effect immediately
                                 prior to his Retirement subject to such changes
                                 as may be made to the coverage offered to
                                 active salaried exempt Employees of the
                                 Employer from time to time.

                      (ii)       Beginning immediately after midnight of the day
                                 prior to the Participant's 65th birthday, the
                                 Employer will provide to the Participant at its
                                 sole cost and expense a supplemental medical
                                 plan designed to supplement Parts A and B of
                                 Medicare (or whatever the equivalent coverage
                                 may be at some future date). The coverage
                                 provided under this Section 5.01(a)(ii) may be
                                 amended from time to time, either before or
                                 after a Participant's Retirement.



                                       9
<PAGE>   15

           (b)        After the Retirement or death of a Participant, the
                      medical insurance and other medical benefits provided
                      active salaried exempt Employees will be made available to
                      Eligible Dependents of the Participant at the Employer's
                      sole cost and expense until they reach the age of
                      sixty-five (65) or cease to qualify as Eligible
                      Dependents. Upon reaching the age of sixty-five (65), the
                      Participant's Eligible Dependents will be provided a
                      supplemental medical plan at the Employer's sole cost and
                      expense designed to supplement Parts A and B of Medicare
                      (or whatever the equivalent coverage may be at some future
                      date). The coverage provided under this Section 5.01(b)
                      may be amended from time to time.

           (c)        All medical insurance or other medical benefits provided
                      to any person pursuant to this Article shall be reduced by
                      the amount of corresponding employer-provided (or any
                      other third-party provided) medical insurance and medical
                      benefits provided to that person at any time under a group
                      or governmental plan.

5.02       LIFE INSURANCE: If, under a group life insurance program of the
           Employer, the Participant has in effect basic group life insurance up
           to the date of his Retirement and is entitled to the immediate
           payment of annuity benefits under his Employer's qualified defined
           benefit pension plan, the Employer will continue to carry life
           insurance on the Participant's life after Retirement, with premiums
           paid solely by the Employer, to the extent of, and in accordance
           with, the following:

           (a)        Effective immediately after midnight of the day prior to
                      Retirement, the amount of basic group life insurance
                      coverage in effect for the Participant will be reduced by
                      fifty percent (50%).

           (b)        Effective immediately after midnight of the day prior to
                      the Participant's sixty-sixth (66th) birthday, the amount
                      of basic group life insurance coverage will be further
                      reduced by ten percent (10%) of the amount of
                      pre-Retirement coverage. The amount of basic group life
                      insurance coverage will be further reduced each succeeding
                      year effective immediately after midnight of the day prior
                      to the Participant's birthday by ten percent (10%) of the
                      pre-Retirement amount, provided that the amount of basic
                      group life insurance coverage shall not be reduced below
                      $10,000.

           (c)        If the Participant continues to be an Employee after his
                      Normal Retirement Age, the Employer will continue to
                      provide basic group life insurance for which the
                      Participant is eligible as an active Employee under the
                      group insurance program of the Employer until the
                      Participant's Retirement. Effective immediately after
                      midnight of the day prior to Retirement, the amount of
                      basic group life insurance coverage in effect will be
                      reduced by fifty percent (50%) plus ten percent (10%) for
                      every year by which the Participant's age at Retirement
                      exceeds sixty-five (65); provided, however, that the
                      amount of basic group life insurance in effect shall not
                      be reduced below $10,000. The amount of basic group life
                      insurance coverage in effect for the Participant (if in
                      excess of $10,000) will be further reduced each year
                      effective immediately after midnight of the day prior to
                      the Participant's birthday by ten percent (10%) of the
                      pre-Retirement amount, which



                                       10
<PAGE>   16

                      reduction will be repeated until the amount of basic group
                      life annual insurance coverage reaches $10,000, which
                      amount will then continue unchanged until the
                      Participant's death.

                        ARTICLE 6: COVENANTS OF EMPLOYEE

6.01       DURING CONTINUATION OF EMPLOYMENT: As long as a Participant continues
           as an Employee of the Employer, the Participant shall devote his
           entire working time to the service of the Employer, except to the
           extent that the Committee shall waive this provision.

6.02       FOLLOWING TERMINATION OF EMPLOYMENT: Upon termination of employment,
           the Participant, until the earlier of his death or the date which is
           five (5) years from the date of termination of employment:

           (a)        shall from time to time consult with the Corporation and
                      its Affiliated Companies in an advisory capacity if, and
                      when, the Participant is reasonably requested to do so by
                      the Corporation or any such Affiliated Company;

           (b)        shall not, without the written consent of the Committee,
                      compete directly or indirectly, or participate in any
                      business that competes directly or indirectly, with the
                      Corporation or any Affiliated Company in any geographic
                      area where the Corporation or any such Affiliated Company
                      is conducting or actively proposing to conduct its
                      business at the time of such termination of employment.
                      The foregoing shall include but not be limited to (i)
                      serving as an executive officer, employee, agent or
                      representative of, or consultant to, or having any direct
                      or indirect interest, as a stockholder, partner or joint
                      venturer or any other financial interest in, any business
                      that manufactures or markets products manufactured or
                      marketed by the Corporation or an Affiliated Company in
                      areas in which any of the foregoing is, at the time of
                      such termination of employment, marketing or actively
                      proposing to market such products, provided that ownership
                      by the Participant, directly or indirectly, of less than
                      five percent (5%) of the outstanding shares of stock of
                      any company listed on any national securities exchange
                      shall be deemed not to be a participation in a business;
                      and (ii) directly or indirectly soliciting customers or
                      employees of the Corporation or an Affiliated Company at
                      the time of the termination of employment or enterprises
                      or individuals that were customers or employees of the
                      Corporation or an Affiliated Company at any time during
                      the twelve-month period ending upon the termination of
                      employment or which were at such time being actively
                      solicited by the Corporation or an Affiliated Company to
                      become customers or employees of the Corporation or an
                      Affiliated Company;

           (c)        shall cooperate and assist in any litigation, arbitration
                      or similar proceeding in which the Corporation or any
                      Affiliated Company is a party or has an interest if, and
                      when, the Participant is reasonably requested to do so by
                      the Corporation or any such Affiliated Company (the
                      Corporation shall pay any out-of-pocket expenses); and



                                       11
<PAGE>   17

           (d)        shall not, except with the written consent of the
                      Committee, or to the extent compelled by a court of
                      competent jurisdiction, disclose or use directly or
                      indirectly any trade secrets or other confidential
                      information or proprietary data of the Corporation or any
                      Affiliated Company; provided, however, that confidential
                      information shall not include any information known to the
                      public (other than as a result of unauthorized disclosure
                      by the Participant) or any information of a type not
                      otherwise considered confidential by persons engaged in
                      the same or similar businesses.

6.03       REMEDY FOR BREACH: If the Participant at any time fails to comply
           with the requirements of Sections 6.01 or 6.02, the Employer's
           obligation to pay or provide benefits hereunder to any Participant or
           to the Participant's surviving Spouse or Children shall automatically
           terminate and neither said Participant nor the Participant's
           surviving Spouse, Children or any other person claiming any benefits
           pursuant to the Participant's participation in the Plan shall have
           any rights, claims or causes of action hereunder against the Board,
           the Committee, the Corporation, the Plan Administrator, the Employer
           or any Affiliated Company, any trust or other funding vehicle
           maintained in respect of the Plan, or any person acting on their
           behalf. The remedy provided in this Section 6.03 for breach by the
           Participant of the provisions of Section 6.02 hereof shall be
           exclusive; provided, however, that the Employer shall not be
           precluded from pursuing any other remedies available to it under any
           other plan or agreement with the Participant that contains
           non-compete provisions and other restrictive covenants.

                     ARTICLE 7: OBLIGATION TO PAY BENEFITS

7.01       EMPLOYER OBLIGATED TO PAY: Except as otherwise provided in Articles 6
           and 7, the Employer employing the Participant on the date of
           termination of the Participant's employment shall be obligated to pay
           or provide the benefits to which the Participant, his Spouse and
           Children are entitled under the Plan.

7.02       AMENDMENT OR TERMINATION OF THE PLAN: The Committee reserves the
           right at any time, and from time to time, to amend, in full or in
           part, any or all of the provisions of the Plan, or to terminate the
           Plan at any time. The right to amend the Plan shall include the right
           to provide for additional benefits for a Participant or to waive the
           applicability of certain Plan provisions to a Participant pursuant to
           a separate contractual agreement. All amendments (including any
           contractual agreements providing for additional benefits or waivers)
           shall be authorized by the Committee and signed by a duly authorized
           representative thereof. Notwithstanding the foregoing, however, no
           such amendment or termination shall have the effect of reducing the
           benefits:

           (a)        payable under Articles 3 and 4 hereof to a Participant
                      whose employment terminated prior to the effective date of
                      such amendment or termination of the Plan or payable to
                      such Participant's Spouse or Children; or

           (b)        to which a Participant, his surviving Spouse or Children
                      are entitled under Articles 3 and 4 hereof assuming, for
                      purposes of computing those benefits, that (i) the date of
                      the amendment or termination, as applicable, is the date
                      of the



                                       12
<PAGE>   18

                      Participant's Retirement; (ii) the amount of Other
                      Benefits to which the Participant, his Spouse or Children
                      are entitled, includes only Other Benefits as had accrued
                      prior to the date of the amendment or termination; and
                      (iii) the Participant is not given credit in computing his
                      Years of Service under the last sentence of Section 4.01
                      or the next to last sentence of Section 4.04 for any
                      period subsequent to the date of the amendment or
                      termination; or

           (c)        to which any Participant and any Participant's surviving
                      Spouse or Children are entitled upon Retirement or death
                      under Article 5 hereof as in effect prior to any amendment
                      or termination, except as specifically allowed pursuant to
                      Section 5.01(a)(i) and the last sentences of Sections
                      5.01(a)(ii) and 5.01(b).

7.03       SUBSEQUENT TO A CHANGE IN CONTROL OF THE CORPORATION: If, after a
           Change in Control of the Corporation shall have occurred, a
           Participant's employment is terminated for any reason other than
           Retirement, death or Disability or for Cause, the Employer
           nonetheless shall be unconditionally obligated notwithstanding the
           provisions of Article 6, to pay or provide benefits to such
           Participant and to the Participant's surviving Spouse and Children
           under Articles 3 and 4 hereof that are not less than the benefits
           that would be payable under such provisions assuming that:

           (a)        the date of the Change in Control were the date of the
                      Participant's Retirement;

           (b)        the amount of Other Benefits to which the Participant, his
                      Spouse or Children were entitled included only the Other
                      Benefits as had accrued prior to the date of the Change in
                      Control; and

           (c)        the Participant were not given credit in computing his
                      Years of Service under the last sentence of Section 4.01
                      or the next to last sentence of Section 4.04 for any
                      period subsequent to the date of the Change in Control.

7.04       TRANSFERS OF EMPLOYMENT:

           (a)        In the event a Participant is transferred to an Affiliated
                      Company that does not have a supplemental retirement
                      benefit plan:

                      (i)        If the Affiliated Company to which the
                                 Participant is transferred so agrees, the
                                 Participant shall continue to accrue benefits
                                 under the Plan, whereupon the Employer
                                 employing the Participant immediately prior to
                                 the transfer shall transfer to the Affiliated
                                 Company all assets, if any, held by the
                                 Employer for purposes of funding any liability
                                 to the Participant hereunder, and the
                                 Affiliated Company shall assume (and the
                                 Employer employing the Participant immediately
                                 prior to the transfer will be relieved of) all
                                 liability for payment of benefits hereunder to
                                 the Participant;

                      (ii)       Otherwise, the responsibility for providing the
                                 accrued benefits hereunder shall remain with
                                 the Employer employing the Participant prior to
                                 the transfer. The accrued benefits shall be
                                 limited to the benefits that would



                                       13
<PAGE>   19

                                 be payable to the Participant, his Spouse and
                                 Children under Section 7.02 had the Plan been
                                 terminated with respect to the Participant on
                                 the date of the transfer of employment.

           (b)        In the event a Participant is transferred to an Affiliated
                      Company that has a supplemental retirement plan that does
                      not give credit for Years of Service with the Corporation
                      and any other Affiliated Company prior to the date of the
                      transfer, the responsibility for providing the accrued
                      benefits hereunder shall remain with the Employer
                      employing the Participant prior to the transfer unless
                      there is a mutual agreement between the two employers that
                      the successor employer shall be responsible for providing
                      accrued benefits. The accrued benefits shall be limited to
                      the benefits that would be payable to the Participant, his
                      Spouse and Children under Section 7.02 had the Plan been
                      terminated with respect to the Participant on the date of
                      the transfer of employment.

           (c)        In the event a Participant is transferred to an Affiliated
                      Company that has a supplemental retirement plan that gives
                      credit for Years of Service with the Corporation and any
                      other Affiliated Company prior to the date of the
                      transfer, and if the Participant accepts designation as a
                      participant in that plan, the Participant shall be
                      entitled only to the benefits of the supplemental
                      retirement plan of the Employer employing the Participant
                      subsequent to the transfer, and the Employer employing the
                      Participant immediately prior to the transfer shall have
                      no further obligation hereunder; however, to the extent
                      that the benefits payable to the Participant on account of
                      service to an Employer prior to the date of the transfer
                      are less than the benefits that would be payable to the
                      Participant under Section 7.02(b) had the Plan been
                      terminated with respect to the Participant on the date of
                      the transfer of employment, the Employer employing the
                      Participant prior to the transfer shall be liable to the
                      Participant to the extent of any shortfall. If the
                      Participant does not accept designation as a participant
                      in the plan, then the Participant shall be treated as
                      though he had transferred to an Affiliated Company that
                      does not have a supplemental retirement benefit plan.

                          ARTICLE 8: GENERAL PROVISIONS

8.01       LIMITATION OF RIGHTS OF THE EMPLOYEE: Inclusion under the Plan shall
           not give a Participant, his Spouse, or his Children any right or
           claim to a benefit, except as specifically defined in this Plan. The
           establishment of the Plan shall not be construed as giving any
           Employee a right to be continued in the service of the Corporation or
           any Affiliated Company.

8.02       DISCHARGE OF OBLIGATIONS: The Employer and the Committee may at any
           time fully and completely satisfy and discharge all its obligations
           hereunder to the Participant, his Spouse or his Children by:

           (a)        delivering, or causing to be delivered, to the
                      Participant, his Spouse, or his Children a fully-paid
                      policy issued by a corporate insurer rated "A" or "A-plus"
                      in Best's Insurance Guide; or



                                       14
<PAGE>   20

           (b)        instituting or amending a pension plan in which the
                      Participant is a Participant to provide an equal benefit;
                      or

           (c)        making some other arrangement for the Participant, his
                      Spouse, or his Children; provided that, in any case
                      mentioned in (a), (b), or (c) hereof, provision is made
                      for not less than the benefits to which the Participant,
                      his Spouse or his Children, as the case may be, may be
                      entitled under the provisions hereof; or

           (d)        entering into a contract with the Participant, containing
                      terms mutually agreed upon by the Employer and the
                      Participant, to provide benefits in lieu of those provided
                      hereunder.

8.03       NO ASSIGNMENT OF BENEFITS: None of the rights of the Participant or
           of other beneficiaries under this Plan shall be assignable in whole
           or in part either directly or by will or succession, but shall be
           personal to the individual Participant, the Participant's surviving
           Spouse, or the Participant's Children as the case may be.

8.04       ADMINISTRATIVE POWERS RELATING TO PAYMENTS: (a) If any person
           eligible to receive payments under the provisions of this Plan is
           under a legal disability or, by reason of illness or mental or
           physical disability, is, in the opinion of the Plan Administrator,
           unable to properly administer payments made pursuant to the Plan, the
           Committee or its designee shall make payments in any of the following
           ways:

                      (i)        Directly to the person eligible to receive the
                                 payments;

                      (ii)       To the legal representative of such person
                                 eligible to receive payments or;

                      (iii)      To some relative by blood or marriage, or
                                 friend, for the benefit of such person eligible
                                 to receive payments.

           (b)        Any payment made pursuant to this Section shall be in
                      complete discharge of the obligation therefor under the
                      Plan.

8.05       MULTIPLE CLAIMANTS: If two or more persons other than the Participant
           shall claim to be entitled to any payment hereunder on the ground
           that any one or more of such persons is the surviving Spouse or a
           Child of the Participant, payment to one or more of those persons as
           shall in the opinion of the Employer be entitled thereto shall
           discharge all obligations of the Employer hereunder in respect of
           that payment.

8.06       ADMINISTRATION: The Plan Administrator shall have full authority to
           control and manage the operation and administration of the Plan,
           including the right to appoint other fiduciaries, to appoint or
           employ individuals to assist in the administration of the Plan and
           any other agents it deems advisable (including legal and actuarial
           counsel) and to delegate to others any administrative procedures that
           are necessary for the administration of the Plan. Subject to the
           provisions of Article 9, the decision of the Plan Administrator on
           all matters concerning the interpretation and administration of this
           Plan shall be final. Neither the Board, the Corporation, the
           Committee, the Plan Administrator, any



                                       15
<PAGE>   21

           Affiliated Company, nor any persons acting on their behalf shall be
           subject to any liability to any Participant or other person in
           connection with the construction and administration of this Plan.

8.07       INDEMNIFICATION: The Corporation shall indemnify each member of the
           Committee, the Board of Directors, and the Plan Administrator (if
           different from the Committee), or any of their delegees, against
           costs, expenses and liabilities, including attorney's fees, incurred
           in connection with any action, suit or proceeding instituted against
           them or any one of them because of any act of omission or commission
           performed by them or any one of them as a director, committee member
           or Plan Administrator, or designee or delegee thereof, as the case
           may be, while acting in good faith and exercising his judgment for
           the best interest of the Plan.

           Promptly after receipt by an indemnified party under this Section of
           notice of the commencement of any action, such indemnified party
           will, if a claim in respect thereof is to be made against the
           Corporation, notify the Corporation of the commencement thereof, and
           the omission so to notify the Corporation will relieve it from the
           liability hereunder, but not from any other liability which it may
           have to such person. The Corporation shall be entitled to participate
           at its own expense in the defense or to assume the defense of any
           action brought against any party indemnified hereunder.

           In the event the Corporation elects to assume the defense of any such
           suit, such defense shall be conducted by counsel chosen by it and
           reasonably satisfactory to the indemnified party, and the indemnified
           party shall bear the fees and expenses of any additional counsel
           retained by him.

8.08       EXPENSES: Any expenses reasonably incurred by the Committee, the
           Board, or the Plan Administrator (if different from the Committee),
           or their designees, in the performance of their duties shall be paid
           by the Corporation. Reasonable expenses include the cost of insurance
           obtained to protect the Committee, the Board, the Plan Administrator,
           or their designees, from personal liability resulting from their
           actions taken in a fiduciary capacity with respect to this Plan.

8.09       FUNDING: The Employer's obligations under this Plan shall be
           unfunded, and the Employer shall not be obligated under any
           circumstances to fund its obligations under this Plan.

8.10       PAYMENT OF PARTICIPANT'S EXPENSES: The Employer shall pay or
           reimburse a Participant for all costs, including reasonable
           attorneys' fees and expenses of litigation and/or arbitration,
           incurred by the Participant in seeking to obtain or enforce any right
           or benefit provided by the Plan, provided that the Participant is the
           prevailing party in any such litigation or arbitration proceeding.

8.11       GOVERNING LAW: To the extent not preempted by ERISA, this Plan shall
           be governed by and interpreted in accordance with the substantive
           laws of the State of Delaware and shall be binding upon the
           Corporation.



                                       16
<PAGE>   22

8.12       SEVERABILITY: The provisions of this Plan are severable, and the
           invalidity or unenforceability of any provision shall not affect the
           validity or enforceability of any other provision.

8.13       NAMED FIDUCIARY:  The Plan Administrator is the named fiduciary.

                           ARTICLE 9: CLAIMS PROCEDURE

9.01       SUBMISSION OF CLAIMS: Claims for benefits under the Plan shall be
           submitted in writing to the Plan Administrator or a person designated
           by the Plan Administrator for this purpose. Written notice of the
           disposition of a claim shall be furnished the claimant within ninety
           (90) days after the application therefor is filed. The ninety-day
           notice period shall, however, be extended for an additional ninety
           (90) days if the Plan Administrator determines that an extension of
           time is necessary to process the claim and so advises the claimant in
           writing within ninety (90) days after receipt of the claim, which
           writing shall also indicate the special circumstances requiring an
           extension of time and the date by which the Plan Administrator
           expects to render the final decision.

9.02       WRITTEN NOTICE OF DENIED CLAIM: The Plan Administrator or its
           designee shall provide adequate notice in writing to any person whose
           claim for benefits has been denied. The notice shall set forth the
           specific reason or reasons for the denial and shall be written in a
           manner calculated to be understood by the recipient. The notice shall
           also refer specifically to pertinent Plan provisions on which the
           denial is based; shall describe any additional material or
           information necessary for the claimant to perfect the claim; and
           shall explain why the additional material or information is
           necessary. The notice shall also explain the Plan's claims review
           procedure.

9.03       REVIEW OF DECISION DENYING CLAIM: The Plan Administrator or its
           designee shall afford to any person whose claim for benefits has been
           denied a reasonable opportunity for a full and fair review of the
           decision denying the claim. The claimant or his duly authorized
           representative shall request a review in writing not more than ninety
           (90) days after receipt by the claimant of written notification of
           denial of a claim. Within ten (10) days after, or as part of, a
           timely request for review, the claimant may submit issues and
           comments in writing and may review pertinent documents.

9.04       HEARING: Upon receipt of a timely request for review, the Plan
           Administrator or its designee may hear the claimant's request and
           inquire into the merits of the matter. The Plan Administrator or its
           designee shall meet promptly with the claimant and/or his duly
           authorized representative and hear arguments and/or examine documents
           the claimant or his representative present.

9.05       WRITTEN DECISION OF PLAN ADMINISTRATOR: A decision of the Plan
           Administrator or its designee on review of a claim shall be in
           writing and shall include specific reasons for the decision, written
           in a manner calculated to be understood by the claimant. The decision
           shall include specific references to the pertinent Plan provisions on
           which the decision is based. The decision shall be made promptly and
           not later than sixty (60) days after a request for review, unless
           special circumstances require an



                                       17
<PAGE>   23

           extension. In that case, the claimant shall be so advised in writing
           prior to the expiration of the initial sixty (60) day period and a
           decision shall be rendered as soon as possible, but not later than
           one hundred and twenty (120) days after receipt of a request for
           review.

           IN WITNESS WHEREOF, the Corporation has caused this document to be
executed by its duly authorized officer this 11th day of May 1999, but effective
as of February 26, 1999.


                                       BOWATER INCORPORATED



                                       By: /s/ James T. Wright
                                           -------------------------------------
                                       Name: James T. Wright
                                       Title: Vice President - Human Resources




                                       18