Document:

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                                                                   EXHIBIT 4.10

                           CARAUSTAR INDUSTRIES, INC.
                            EMPLOYEES' SAVINGS PLAN

                 Amended and Restated Effective January 1, 2003

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                                    CONTENTS

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PREAMBLE......................................................................................................... 1

                                   ARTICLE I

                    REFERENCES, CONSTRUCTION AND DEFINITIONS

1.1      Account................................................................................................I-1
1.2      Adjustment.............................................................................................I-1
1.3      Affiliate..............................................................................................I-2
1.4      After-Tax Rollover Contributions.......................................................................I-2
1.5      After-Tax Rollover Contributions Account...............................................................I-2
1.6      Beneficiary............................................................................................I-2
1.7      Board..................................................................................................I-2
1.8      Break in Service.......................................................................................I-2
1.9      Code...................................................................................................I-2
1.10     Company................................................................................................I-2
1.11     Compensation...........................................................................................I-2
1.12     Contribution Percentage Amounts........................................................................I-3
1.13     Defined Benefit Plan...................................................................................I-3
1.14     Defined Contribution Plan..............................................................................I-3
1.15     Reserved...............................................................................................I-3
1.16     Employee...............................................................................................I-3
1.17     Employee After-Tax Account.............................................................................I-3
1.18     Employee After-Tax Contributions.......................................................................I-3
1.19     Employee Pre-Tax Catch-Up Contributions................................................................I-3
1.20     Employee Pre-Tax Catch-Up Contributions Account........................................................I-3
1.21     Employer...............................................................................................I-4
1.22     Employer Contributions.................................................................................I-4
1.23     Employer Contributions Account.........................................................................I-4
1.24     Employer Matching Contribution Account.................................................................I-4
1.25     Employer Matching Contributions........................................................................I-4
1.26     Employment Commencement Date...........................................................................I-4
1.27     ERISA..................................................................................................I-4
1.28     Excess Aggregate Contributions.........................................................................I-4
1.29     Excess Contributions...................................................................................I-5
1.30     Forfeiture.............................................................................................I-5
1.31     Highly Compensated Employee............................................................................I-5
1.32     Hour of Service........................................................................................I-5
1.33     Income Deferral Contribution Account...................................................................I-7
1.34     Income Deferral Contributions..........................................................................I-7
1.35     Investment Manager.....................................................................................I-7
1.36     Leave of Absence.......................................................................................I-7
1.37     Maternity/Paternity Absence............................................................................I-7
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1.38     Named Fiduciary........................................................................................I-7
1.39     Non-Highly Compensated Employee........................................................................I-7
1.40     Normal Retirement Age..................................................................................I-7
1.41     Participant............................................................................................I-7
1.42     Plan...................................................................................................I-7
1.43     Plan Administrator.....................................................................................I-7
1.44     Plan Year..............................................................................................I-8
1.45     Prior Company Match Post-`92 Account...................................................................I-8
1.46     Prior Company Match Pre-`93 Account....................................................................I-8
1.47     Prior Employer Accounts................................................................................I-8
1.48     Prior Plan Accounts....................................................................................I-8
1.49     Prior Plan Profit Sharing Account......................................................................I-8
1.50     Prior Plan Qualified Matching Contribution Account.....................................................I-8
1.51     Qualified Election.....................................................................................I-8
1.52     Reemployment Commencement Date.........................................................................I-9
1.53     Required Commencement Date.............................................................................I-9
1.54     Rollover Account.......................................................................................I-9
1.55     Rollover Contributions.................................................................................I-9
1.56     Special Transition Contribution........................................................................I-9
1.57     Spouse.................................................................................................I-9
1.58     Total and Permanent Disability.........................................................................I-9
1.59     Trust Agreement.......................................................................................I-10
1.60     Trust Fund............................................................................................I-10
1.61     Trustee...............................................................................................I-10
1.62     Valuation Date........................................................................................I-10
1.63     Year of Service.......................................................................................I-10

                                                                            ARTICLE II

                                                                          PARTICIPATION

2.1      Participation.........................................................................................II-1
2.2      Participant Information...............................................................................II-2

                                                                           ARTICLE III

                                                                          CONTRIBUTIONS

3.1      Income Deferral Contributions........................................................................III-1
3.2      Employee After-Tax Contributions.....................................................................III-2
3.3      Employer Matching Contributions......................................................................III-3
3.4      Rollover Contributions...............................................................................III-3
3.5      Cessation of Employer Contributions..................................................................III-4
3.6      Reversion of Contributions...........................................................................III-4
3.7      Special Transition Contribution......................................................................III-4
3.8      Section 415 Limitations..............................................................................III-5
3.9      Dollar Limitation on Income Deferral Contributions...................................................III-7
3.10     Actual Deferral Percentage Test......................................................................III-9
3.11     Actual Contribution Percentage Test.................................................................III-12
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3.12     Alternative Testing Methods.........................................................................III-18

                                                                            ARTICLE IV

                                                                       PARTICIPANT ACCOUNTS

4.1      Participant Investment Elections......................................................................IV-1
4.2      Allocations...........................................................................................IV-1
4.3      Valuation Report......................................................................................IV-3

                                                                            ARTICLE V

                                                                  DISTRIBUTION OF PLAN BENEFITS

5.1      Eligibility for Plan Benefits..........................................................................V-1
5.2      Distribution Rules and Methods.........................................................................V-4
5.3      Reserved...............................................................................................V-7
5.4      In-Service Withdrawals.................................................................................V-7
5.5      Hardship Withdrawal Requirements.......................................................................V-8
5.6      Loans to Participants.................................................................................V-10
5.7      Sale or Other Disposition by the Employer.............................................................V-10
5.8      Direct Rollover.......................................................................................V-10
5.9      Spendthrift Clause....................................................................................V-11
5.10     Benefit Supported Only by Trust Fund..................................................................V-11
5.11     Legally Incompetent...................................................................................V-12
5.12     Missing Participant...................................................................................V-12

                                                                            ARTICLE VI

                                                                       PLAN ADMINISTRATION

6.1      Plan Administrator....................................................................................VI-1
6.2      Appointment...........................................................................................VI-1
6.3      Term and Compensation.................................................................................VI-1
6.4      Claims Procedure......................................................................................VI-2
6.5      Plan Administrative Committee Actions.................................................................VI-7
6.6      Investment Manager....................................................................................VI-7
6.7      Benefit Payment Directions............................................................................VI-7
6.8      Nondiscrimination.....................................................................................VI-7
6.9      Agents................................................................................................VI-8
6.10     Records and Reports...................................................................................VI-8
6.11     Indemnification.......................................................................................VI-8
6.12     Liquidity and Investments.............................................................................VI-8
6.13     Power and Duties of the Plan Administrative Committee.................................................VI-8
6.14     Employer to Supply Information........................................................................VI-9
6.15     Self-Interest.........................................................................................VI-9
6.16     Corrections..........................................................................................VI-10
6.17     New Technologies.....................................................................................VI-10
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                                         ARTICLE VII

                                   TRUST FUND AND TRUSTEE

7.1       Trust Fund ...........................................................       VII-1

                                        ARTICLE VIII

                                         FIDUCIARIES

8.1       Named Fiduciary ......................................................      VIII-1
8.2       Fiduciary Duty .......................................................      VIII-1
8.3       Fiduciary Liability ..................................................      VIII-1
8.4       Co-Fiduciary Liability ...............................................      VIII-1
8.5       Allocation and Delegation of Responsibilities ........................      VIII-1
8.6       Advisors .............................................................      VIII-2
8.7       Dual Capacities ......................................................      VIII-2

                                         ARTICLE IX

                                  AMENDMENT AND TERMINATION

9.1       Amendment ............................................................        IX-1
9.2       Termination ..........................................................        IX-1

                                          ARTICLE X

                                       TOP-HEAVY RULES

10.1      Top-Heavy Provisions .................................................         X-l
10.2      Minimum Vesting ......................................................         X-4

                                         ARTICLE XI

                         PLAN ADOPTION AND EMPLOYMENT RELATIONSHIPS

11.1      Joinder of Employers .................................................        XI-1
11.2      Employment and Years of Service Credit ...............................        XI-1
11.3      Service with Affiliates ..............................................        XI-1

                                         ARTICLE XII

                                        MISCELLANEOUS

12.1      Nature of Plan .......................................................       XII-1
12.2      Discrimination .......................................................       XII-1
12.3      Merger or Consolidation ..............................................       XII-1
12.4      Additional Procedures ................................................       XII-1
12.5      Qualified Domestic Relations Order ...................................       XII-1
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12.6      Agent for Service of Process .........................................       XII-1
12.7      Expenses .............................................................       XII-2
12.8      Diversion ............................................................       XII-2
12.9      Agreement Not an Employment Contract .................................       XII-2
12.10     Severability .........................................................       XII-2
12.11     USERRA (Uniformed Services Employment and Reemployment Rights Act of 1994)   XII-2

                                        ARTICLE XIII

                  TRANSFER OF ASSETS FROM THE FEDERAL PACKAGING CORPORATION
                                   RETIREMENT SAVINGS PLAN

13.1      Effective Date of Transfer ...........................................      XIII-1
13.2      Eligibility and Participation ........................................      XIII-1
13.3      Vesting ..............................................................      XIII-1
13.4      Separate Accounts ....................................................      XIII-1
13.5      Rules Governing Accounts Transferred from the Federal Plan ...........      XIII-1

                                         ARTICLE XIV

                    MERGER OF FEDERAL PACKAGING CORPORATION SAVINGS PLAN
                          FOR COLLECTIVE BARGAINING UNIT EMPLOYEES

14.1      Effective Date of Merger .............................................       XIV-1
14.2      Eligibility and Participation ........................................       XIV-1
14.3      Vesting and Accounts .................................................       XIV-1

                                         ARTICLE XV

     TRANSFER OF ASSETS FROM THE GARBER COMPANY 401(K) SALARIED RETIREMENT SAVINGS PLAN
           AND THE SPECIAL PACKAGING, INC. 401(K) SALARIED RETIREMENT SAVINGS PLAN

15.1      Effective Date of Transfer ...........................................        XV-1
15.2      Eligibility and Participation ........................................        XV-1
15.3      Vesting ..............................................................        XV-1
15.4      Transfer to Caraustar Accounts .......................................        XV-1
15.5      Rules Governing Garber Plan and Special Plan Accounts ................        XV-1

                                         ARTICLE XVI

                   MERGERS INTO THE CARAUSTAR PLAN EFFECTIVE APRIL 1, 1998

16.1      Effective Date of Merger .............................................       XVI-1
16.2      Eligibility and Participation ........................................       XVI-1
16.3      Vesting...............................................................       XVI-1
16.4      Transfer to Caraustar Accounts .......................................       XVI-1
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                                        ARTICLE XVII

                   MERGER INTO THE CARAUSTAR PLAN EFFECTIVE JUNE 30, 1998

17.1      Effective Date of Merger .............................................      XVII-1
17.2      Eligibility and Participation ........................................      XVII-1
17.3      Vesting ..............................................................      XVII-1
17.4      Transfer to Caraustar Accounts .......................................      XVII-1
17.5      Special Rules for Chesapeake Plan Accounts ...........................      XVII-1

                                        ARTICLE XVIII

                         MERGER OF CRANE CARTON COMPANY 401(K) PLAN

18.1      Effective Date of Merger .............................................     XVIII-1
18.2      Eligibility and Participation ........................................     XVIII-1
18.3      Vesting and Accounts .................................................     XVIII-1

                                         ARTICLE XIX

                MERGER OF ARROW PAPER PRODUCTS HOURLY 401(K)PLAN

19.1      Effective Date of Merger..............................................       XIX-1
19.2      Eligibility and Participation.........................................       XIX-1
19.3      Vesting and Accounts..................................................       XIX-1
19.4      Non-Discrimination Testing Under Arrow Plan...........................       XIX-1

                                         ARTICLE XX

                                   MULTIPLE EMPLOYER PLAN

20.1      General ..............................................................        XX-1
20.2      Procedure for Adoption by Other Employers ............................        XX-1
20.3      Separate Application of Provisions ...................................        XX-1

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                                   APPENDIX A

           PERIOD OF ELIGIBILITY SERVICE REQUIRED FOR ELIGIBILITY TO
                            PARTICIPATE IN THE PLAN

                                   APPENDIX B

                    INCOME DEFERRAL CONTRIBUTION LIMITATIONS

                                     -vi-
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                           CARAUSTAR INDUSTRIES, INC.
                            EMPLOYEES' SAVINGS PLAN

                 Amended and Restated Effective January 1, 2003
                                    PREAMBLE

         This is an amendment and restatement of the CHICAGO, CINCINNATI &
CHATTANOOGA PAPERBOARD CORPORATIONS EMPLOYEES SAVINGS PLAN, which was
originally established August 21, 1984, and was subsequently restated and
amended effective January 1, 1989. The Plan was renamed the CARAUSTAR
INDUSTRIES, INC. EMPLOYEES' SAVINGS PLAN effective June 1, 1994. The Plan
was restated, effective January 1, 2002, for the so-called "GUST" changes
in the law.

         This amendment and restatement is generally effective as of January
1, 2003. It incorporates all prior amendments with one exception: The Second
Amendment, executed April 26, 2002, which is the so-called "good faith EGTRRA
amendment," is not superseded by (and is not incorporated within) this
restatement. Therefore, as of the date of the execution of this amendment and
restatement, the Plan's provisions are expressed in this restatement together
with the good faith EGTRRA amendment executed April 26, 2002.

         This restated Plan document is intended to continue the Plan as a
retirement plan qualified under Internal Revenue Code (Code) Section 401(a)
and the Trust Agreement is intended to continue the Trust as tax-exempt under
Code Section 501(a) as part of the Plan.

          This Plan is intended to operate in accordance with the provisions of
Code Section 401(k) and related regulations as an individual account plan with
a cash or deferred arrangement. As an individual account plan with a cash or
deferred arrangement, the Plan encourages Employees to save additional funds
on a regular basis by deferring a portion of their salary or wages.

          The Employer intends this Plan to meet all of the applicable
requirements of the Employee Retirement Income Security Act of 1974 (ERISA)
and the Code, and this Plan shall be interpreted to comply with ERISA, the
Code and all binding regulations and rulings thereunder.

          The purposes of this amendment and restatement are to (i) incorporate
the First Amendment executed April 26, 2002, into the Plan document, and (ii)
make certain other revisions desired by the employer. The effective dates of
such revisions are summarized below and are, in some cases, also set forth in
the Plan document.

                               Effective Dates

The following amendments are made in this restatement, and are effective as
follows: Section 1.63(l) is effective as of October 1, 2002; the amendment to
Section 2.1(a)(i) is effective as of January 1, 2003; the amendment to Section
5.2(c)(vi) is effective as of October 1, 2002; Section 5.2(c)(vii) is effective
as of October 1, 2002; and the amendments to Appendix A are effective as set
forth therein.

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                                   ARTICLE I

                   REFERENCES, CONSTRUCTION AND DEFINITIONS

         Unless otherwise indicated, all references made in this Plan shall be
to articles, sections and subsections of this Plan. This Plan shall be
construed in accordance with the laws of the State of North Carolina to the
extent that such laws are not preempted by ERISA or other federal laws. Except
for Article I, the headings and subheadings in this Plan have been inserted for
convenience of reference only and are to be ignored in construction of the
provisions of this Plan. In the construction of this Plan, the masculine shall
include the feminine and the singular the plural wherever appropriate. The
following terms (in alphabetical order) shall have the meanings set forth
opposite such terms for purposes of this Plan:

         1.1      Account. The sum of the separate bookkeeping accounts of the
Trust Fund to account for Prior Company Match Pre-'93 Accounts, Prior Company
Match Post-'92 Accounts, Prior Plan Accounts, Employer Contributions Accounts
and Prior Plan Profit Sharing Accounts, as well as Income Deferral
Contributions, Employee After-Tax Contributions, Employer Matching
Contributions and Rollover Contributions, if any, made by or on behalf of each
Participant, and any other monies or investments held in the Trust Fund under
this Plan on behalf of such Participant.

         1.2      Adjustment. Participant Accounts shall be adjusted in
accordance with the following:

         (a)      Income. The interest of a Participant in each investment fund
shall be valued at fair market value and adjusted as of each Valuation Date to
preserve such Participant's proportionate interest in such fund or funds. As of
each Valuation Date, each such fund or funds shall be adjusted to reflect the
effect of income collected and accrued, realized and unrealized profits and
losses, expenses and all other transactions during the period between such
Valuation Date and the last preceding Valuation Date with respect to such fund
or funds.

         (b)      Employee Contributions. A Participant's Employee Income
Deferral and After-Tax Contributions to the Plan shall be deemed to be
allocated to a Participant's Employee Income Deferral or After-Tax Contribution
Account as of the Valuation Date next following the date on which such
contributions are delivered to the Trustee.

         (c)      Employer Matching Contributions. The Employer Matching
Contributions to the Plan shall be deemed to be allocated to a Participant's
Employer Matching Contribution Account as of the Valuation Date next following
the date on which such contributions are delivered to the Trustee.

         (d)      Special Transition Contributions. Special Transition
Contributions to the Plan shall be deemed to be allocated to a Participant's
Employer Contribution Account as of the Valuation Date next following the date
on which such contributions are delivered to the Trustee.

                                      I-1
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         1.3      Affiliate.

         (a)      General Rule. At any time, any (i) trade or business, whether
incorporated or unincorporated, which at such time is considered to be under
common control with the Company or any other company participating in this Plan
under regulations prescribed by the Secretary of the Treasury pursuant to Code
Section 414(b), (c) or (o); and (ii) person or organization which at such time
is a member of an affiliated service group (as defined in Code Section 414(m))
with the Company or any other company participating in this Plan.

         (b)      Special Rule when Applying 415 Limit. For purposes of
applying the Code Section 415 limits in Section 3.8, entities will be
Affiliates if they are under common control with the Company after substituting
"more than 50 percent" for "at least 80 percent" wherever such phrase appears
in Code Section 1563(a)(l).

         1.4      After-Tax Rollover Contributions. Timely contributions of
distributions of after tax contributions from another exempt trust, made to the
Trust Fund by Participants pursuant to Section 3.4 and in accordance with Code
Section 402(c).

         1.5      After-Tax Rollover Contributions Account. The separate
bookkeeping account, established as part of the records of the Trust Fund for
the purpose of accounting for the After-Tax Rollover Contributions, if any, made
by or on behalf of a Participant and all income, expenses, gains and losses
allocated to such account.

         1.6      Beneficiary. The Participant's Spouse or such other person or
persons so designated pursuant to a Qualified Election by the Participant or,
if the Participant is not married and no such designation is made, the
Participant's Beneficiary shall be his estate. The Participant's Beneficiary
may also include his alternate payee, if any, as defined in Code Section
414(p)(8).

         1.7      Board. The Board of Directors of the Company.

         1.8      Break in Service. For each Employee, a period of time during
which he fails to complete or to be credited with more than five hundred (500)
Hours of Service with the employers, where such period of time is either the 12
consecutive month period beginning on his Employment Commencement Date or a
Plan Year; provided, however, that the first such period shall not constitute a
Break in Service for a Participant who is absent from work due to a
Maternity/Paternity Absence. (Provided however, that effective January 1, 2002,
the term "Break in Service" shall have the meaning set forth in Section
1.63(a)(i)(B).

         1.9      Code. The Internal Revenue Code of 1986, as amended.

         1.10     Company. Caraustar Industries, Inc., a North Carolina
Corporation, or any successor or assignee which adopts this Plan in writing.

         1.11     Compensation.

         (a)      Wages as defined in Code Section 3401(a) for purposes of
income tax withholding at the source but determined without regard to any rules
that limit the remuneration included in wages based on the nature or location
of employment or services performed. Compensation shall include elective
contributions that are made by the Employer on behalf of Participants that are
not includable in income under Code Sections 125, 402(a)(8), 402(h) or
132(f)(4), but shall exclude payments such as reimbursement or other expense
allowances, fringe benefits (cash and noncash), moving expenses, deferred
compensation (other than described above) and welfare benefits (other than
described above). Compensation shall be determined based on compensation
actually paid to an Employee over his period of Plan Participation by the
Employer during the Plan Year.

                                      I-2
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         (b)      Compensation in excess of the dollar limit under Code Section
401(a)(17) (as such amount may be adjusted for inflation from time to time for
a Plan Year by the Secretary of the Treasury under Code Sections 401(a)(17) and
415(d)) shall not be taken into account.

         1.12     Contribution Percentage Amounts. For a Plan Year, the amounts
described in Section 3.11(a)(iii)(F) actually used in computing the numerator
of the Actual Contribution Percentage.

         1.13     Defined Benefit Plan. Any plan maintained in accordance with
Code Section 401(a) which is not a Defined Contribution Plan.

         1.14     Defined Contribution Plan. Any plan maintained in accordance
with Code Section 401(a) which provides for an individual account for each
participant and for benefits based solely on the amount in such account.

         1.15     Reserved.

         1.16     Employee. As of any date, any person who is a common law
employee of the Employer or an Affiliate, including any individual who is a
"leased employee" of the Employer within the meaning of Code Sections 414(n)
or (o).

         1.17     Employee After-Tax Account. The separate Account established
(a) to account for Employee After-Tax Contributions, if any, made by a
Participant, and (b) to account for all income, expenses, gains and losses
allocated to such Account.

         1.18     Employee After-Tax Contributions. Those fully vested and
nonforfeitable voluntary contributions made for a Plan Year to the Trust Fund
under this Plan by a Participant by payroll deduction, as provided in Section
3.2.

         1.19     Employee Pre-Tax Catch-Up Contributions. Those contributions
made by the Employer, at the election of a Participant, to the Employee Pre-Tax
Catch-Up Contributions Account pursuant to the terms of the Plan and Code
Section 414(v).

         1.20     Employee Pre-Tax Catch-Up Contributions Account. The separate
bookkeeping account, established as part of the records of the Trust Fund for
the purpose of accounting for the Employee Pre-Tax Catch-Up Contributions, if
any, made on behalf of a Participant and all income, expenses, gains and losses
allocated to such account.

         1.21     Employer. The Company, and any entity executing this Plan
document or otherwise adopting this Plan in writing as provided in Section
11.1. As of January 1, 2002, the following are Employers under the Plan:

         (a)      Caraustar Industries, Inc.;

         (b)      Caraustar Custom Packaging Group, Inc.;

         (c)      Caraustar Recovered Fiber Group, Inc.;

         (d)      Caraustar Industrial and Consumer Products Group, Inc.;

         (e)      Caraustar Mill Group, Inc.;

         (f)      Caraustar Custom Packaging Group (Maryland), Inc.;

         (g)      Chicago Paperboard Corporation;

         (h)      Sprague Paperboard, Inc.;

         (i)      Halifax Paperboard Company, Inc.; and

                                      I-3
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         (j)        Premier Boxboard Limited, LLC.

         1.22     Employer Contributions. For a Plan Year, the amounts
described in Section 3.10(a)(iii)(F) actually used in computing the numerator
of the Actual Deferral Percentage.

         1.23     Employer Contributions Account. The separate bookkeeping
account, established as part of the records of the Trust Fund to account for
nonelective contributions made by the Employer as provided in Section 3.7, and
all income, expenses, gains or losses allocated to such account.

         1.24     Employer Matching Contribution Account. The separate account
established to account for the Employer Matching Contributions, if any, made by
the Employer on behalf of a Participant, and all income, expenses, gains or
losses allocated to such accounts.

         1.25     Employer Matching Contributions. Contributions made by the
Employer to match Income Deferral Contributions as provided in Section 3.3.

         1.26     Employment Commencement Date. The date on which an Employee
first performs an Hour of Service for the Employer or an Affiliate.

         1.27     ERISA. The Employee Retirement Income Security Act of 1974,
as amended.

         1.28     Excess Aggregate Contributions. With respect to any Plan
Year, the excess of: (a) the aggregate Contribution Percentage Amounts of
Highly Compensated Employees for such Plan Year, over (b) the maximum
Contribution Percentage Amounts permitted under the actual contribution
percentage test (determined by hypothetically reducing contributions made on
behalf of Highly Compensated Employees in order of their Contribution
Percentages beginning with the highest of such percentages).

         1.29     Excess Contributions. With respect to any Plan Year, the
excess of: (a) the aggregate amount of employer contributions actually taken
into account in computing the Actual Deferral Percentage of Highly Compensated
Employees for such Plan Year, over (b) the maximum amount of such contributions
permitted under the actual deferral percentage test (determined by
hypothetically reducing contributions made on behalf of Highly Compensated
Employees in order of Actual Deferral Percentages, beginning with the highest
of such percentages).

         1.30     Forfeiture. The dollar amount of any Employer Matching
Contribution Account which is forfeited and removed from such account and
reallocated in accordance with Section 5.1(c)(v).

         1.31     Highly Compensated Employee. For each Plan Year, each
Employee or employee of any other Affiliate who:

         (a)      was a "five percent (5%) owner" (within the meaning of Code
Section 416(i)(l)(B)(i)) at any time during the Plan Year or the preceding
year, or

                                      I-4
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         (b)      for the preceding year had compensation of more than $80,000
(as adjusted for inflation from time to time for a Plan Year by the Secretary
of the Treasury under Code Section 415(d)(l), except that the base period is
the calendar quarter ending September 30, 1996).

         For the purposes of this Section 1.31, "compensation" means
compensation from an Employer within the meaning of Section 415(c)(3) of the
Code.

         In determining Highly Compensated Employee status the Plan
Administrator has not, for any Plan Year beginning after December 31, 1996,
made either the top-paid group election or the calendar year data election (IRS
Notice 97-45, 1997-2 C.B. 296), does not now make any such election, and in the
future shall make any such election only by amendment to the Plan.

         1.32     Hour of Service.

         (a)      Each hour for which an Employee is paid, or entitled to
payment, for the performance of duties for the Employer or an Affiliate as an
Employee during any period of employment.

         (b)      Except as otherwise provided in this Section 1.32(b), each
hour for which an Employee is paid, or entitled to payment, by the Employer or
an Affiliate for a period of time during which no duties are performed
(regardless of whether the employment relationship has terminated) due to
vacation, illness, incapacity (including disability), layoff, jury duty,
military duty or Leave of Absence (credited for the period is which such hour
occurred); provided, however,

                  (i)      no more than five hundred one (501) Hours of Service
         will be credited under this Section 1.32(b) to an Employee on account
         of any single continuous period during which he performs no duties
         (whether or not such period occurs in a single calendar year);

                  (ii)     Hours of Service shall not be credited on account of
         a period during which an Employee is paid or entitled to payment and
         with respect to which no duties are performed, if such payment is made
         or due under a plan maintained solely for the purpose of complying
         with applicable workers' compensation, unemployment compensation or
         disability service laws, or if the payment merely reimburses the
         Employee for a medical or medically related expense incurred by him;
         and

                  (iii)    for purposes of this Section 1.32(b), a payment
         shall be deemed to be made by or due from the Employer or an Affiliate
         regardless of whether such payment is made directly or indirectly
         through a trust fund, insurance company or other organization or
         person to which the Employer or an Affiliate pays premiums or makes
         contributions and regardless of whether such premiums or
         contributions were made for the benefit of a particular Employee or on
         behalf of Employees generally.

         (c)      Subject to the limitations set forth in Sections 1.32(b)(i)
through (iii), each hour of a period (credited for such period) for which back
pay, regardless of mitigation of damages, is either awarded or agreed to by the
Employer or an Affiliate.

                                      I-5
<PAGE>
         (d)      In determining whether an Employee has incurred a Break in
Service for purposes of determining Years of Service, an Employee taking a
Maternity/Paternity Absence shall be credited with completing the number of
Hours of Service he would have completed if not for such absence (or, if such
credit cannot be determined, eight (8) hours for each day of such absence).
Such Hours of Service, not to exceed a total of five hundred one (501) hours
for any one such absence, shall be credited either for the calendar year in
which such absence began if necessary to prevent a Break in Service in such
year, or, in any other case, for the immediately following calendar year. No
such credit for Hours of Service shall be given under this Section 1.32(d)
unless such Employee provides documentation satisfying the reasonable
requirements of the Plan Administrator that such absence was a
Maternity/Paternity Absence and establishing the number of days of such
absence.

         (e)      Credit for the same Hours of Service shall not be awarded
under more than one paragraph under this Section 1.32(e). Hours of Service
credit shall be awarded subject to all the rules set forth in paragraphs (b)
and (c) of the United States Department of Labor Regulations Section
2530.200b-2 which are incorporated in this Plan by this reference. In lieu of
actually recording each Hour of Service which is completed by an Employee whose
hours are not required to be counted and reported under any federal law, such
as the Federal Fair Labor Standards Act, if such person completes at least one
(1) Hour of Service in a week, he shall be credited with forty-five (45) Hours
of Service for each week which he completes as an Employee.

         1.33     Income Deferral Contribution Account. The separate account
established to account for the Income Deferral Contributions, if any, made on
behalf of a Participant and all income, expenses, gains and losses allocated to
such account.

         1.34     Income Deferral Contributions. Those contributions made by
the Employer at the election of a Participant to the Income Deferral
Contribution Account pursuant to Section 3.1 (a).

         1.35     Investment Manager. Any fiduciary who meets the definition of
the term "investment manager" under Section 3(38) of ERISA and who acknowledges
in writing that he is a fiduciary with respect to the Plan.

         1.36     Leave of Absence. An approved leave of absence granted to an
Employee by the Employer in accordance with applicable federal or state law or
the Employer's uniform and nondiscriminatory personnel policy.

         1.37     Maternity/Paternity Absence. Any Employee's absence from work
for the Employer or an Affiliate for any period of time due to:

         (a)      such Employee's pregnancy,

         (b)      the birth of such Employee's child,

         (c)      the placement of a child with such Employee in connection
with the adoption of such child by such Employee, or

                                      I-6
<PAGE>
         (d)      such Employee caring for such child for a period immediately
following such birth or placement of such child.

         1.38     Named Fiduciary. The Plan Administrator which, in
accordance with the provisions of Article VIII, shall have only such duties and
responsibilities in the management and administration of this Plan and the Trust
Fund as are expressly assigned to it in this Plan.

         1.39     Non-Highly Compensated Employee. For each Plan Year, each
Employee or employee of an Affiliate who is not a Highly Compensated Employee.

         1.40     Normal Retirement Age. Age sixty-five (65).

         1.41     Participant. As of any date, an Employee who has satisfied
the eligibility requirements and entered the Plan as set forth in Section 2.1,
a former Employee with an Account, or a Beneficiary of a deceased Participant
who has an Account and, exclusively for Sections 4.1, 5.1(b), 5.2, 5.4, 5.5,
and 5.6, an "alternate payee" (as defined in Code Section 414(p)(8)).

         1.42     Plan. The Caraustar Industries, Inc. Employees' Savings Plan,
as amended from time to time.

         1.43     Plan Administrator. The Company.

         1.44     Plan Year. The calendar year.

         1.45     Prior Company Match Post-'92 Account. The separate
bookkeeping account, established as part of the records of the Trust Fund for
the purpose of accounting for Employer matching contributions that were
transferred to the Plan pursuant to Section 1.63(e)(ii), and credited to
participants' accounts (in a prior plan) after December 31, 1992, and all
income, expenses, gains or losses allocated to such account.

         1.46     Prior Company Match Pre-'93 Account. The separate bookkeeping
account, established as part of the records of the Trust Fund for the purpose
of accounting for Employer matching contributions that were transferred to the
Plan pursuant to Section 1.63(e)(ii), and credited to participants' accounts
(in a prior plan) prior to January 1, 1993, and all income, expenses, gains or
losses allocated to such account.

         1.47     Prior Employer Accounts. The separate bookkeeping account,
established as part of the records of the Trust Fund for the purpose of
accounting for those fully vested and nonforfeitable contributions made to this
Plan by the Employer prior to January 1, 1990 and credited to an "Employer
Account" (as defined in the Plan effective at that date). Such amounts were
subsequently transferred to the Employer Matching Contribution Account, and the
Prior Employer Accounts are no longer maintained.

         1.48     Prior Plan Accounts. The separate bookkeeping account,
established as part of the records of the Trust Fund for the purpose of
accounting for employee elective deferral contributions transferred to the Plan
pursuant to a plan merger or plan-to-plan asset transfer, and all income,
expenses, gains and losses allocated to such account.

                                      I-7
<PAGE>
         1.49     Prior Plan Profit Sharing Account. The separate bookkeeping
account, established as part of the records of the Trust Fund, to account for
profit sharing contributions allocated to participants' accounts under a prior
plan (or plans) and transferred to the Plan pursuant to a plan merger or
plan-to-plan asset transfer, and all income, expenses, gains or losses
allocated to such account.

         1.50     Prior Plan Qualified Matching Contribution Account. The
separate bookkeeping account, established as part of the records of the Trust
Fund for the purpose of accounting for qualified matching contributions
transferred to the Plan pursuant to a plan merger or plan-to-plan transfer, and
all income, expenses, gains and losses allocated to such account.

         1.51     Qualified Election. A Participant's written election of a
Beneficiary, other than his Spouse, consented to by the Participant's Spouse.
If the Participant establishes to the satisfaction of the Plan Administrator
that such written consent may not be obtained because there is no Spouse or the
Spouse cannot be located, a Participant's election will be deemed a Qualified
Election. The Spouse's consent to such election must be witnessed by a
representative or agent of the Plan Administrator or notary public and will be
valid only with respect to the Spouse who signs the consent or, in the event of
a deemed Qualified Election, the designated Spouse. A Participant may revoke a
Qualified Election without the consent of his Spouse at any time before the
commencement of benefits. The number of elections or revocations shall not be
limited.

         1.52     Reemployment Commencement Date. The date on which an Employee
is first credited with an Hour of Service after incurring a one-year Break in
Service.

         1.53     Required Commencement Date.

         (a)      For Participants who are five (5%) percent owners of an
Employer, the Required Commencement Date is the April 1 of the calendar year
following the calendar year in which such Participant attains age 70-1/2.

         (b)      For Participants who are not five (5%) percent owners of an
Employer and who attain age seventy and one-half (70-1/2) after January 1, 1999,
the Required Commencement Date is the April 1 of the calendar year following
the later of:

                  (i)      the calendar year in which the Participant attains
         age seventy and one-half (70-1/2), or

                  (ii)     the calendar year in which the Participant retires.

         Participants who are not five (5%) percent owners of an Employer and
who attain age seventy and one-half (70-1/2) after December 31, 1996 but before
January 1, 1999 and have not yet retired, may elect as a Required Commencement
Date, the date described in Section 1.53(a) or 1.53(b) immediately above. The
election, once made, however, shall be irrevocable.

         For the purposes of this Section, a Participant is treated as a five
percent owner if he is a five percent owner as defined in Section 416 of the
Code.

         1.54     Rollover Account. The Account established to account for
Rollover Contributions, if any, and to account for income, expenses, gains and
losses allocated to such account.

                                      I-8
<PAGE>
         1.55     Rollover Contributions. The timely contributions made to the
Trust Fund by Participants pursuant to Section 3.4, and in accordance with Code
Section 402(c), of distributions from qualified retirement plans maintained in
accordance with Code Section 401(a).

         1.56     Special Transition Contribution. Contributions made to the
Trust Fund pursuant to Section 3.7.

         1.57     Spouse. The individual to whom a Participant is legally
married as of the earlier of such Participant's date of death or the date
payment of his benefit under this Plan begins, or any former Spouse of the
Participant treated as his Spouse or surviving Spouse under Code Section
414(p)(5).

         1.58     Total and Permanent Disability. A Participant will be
considered to have suffered a Total and Permanent Disability upon a
determination that he has incurred a Non-Social Security Administration
Approved Disability or a Social Security Administration Approved Disability
pursuant to paragraph (a) or (b), below:

         (a)      Non-Social Security Administration Approved Disability. The
permanent and total inability of the Participant, by reason of physical or
mental infirmity, or both, to perform any duties with the Employer, which shall
be established by medical examination by a medical doctor selected or approved
by the Plan Administrator.

         (b)      Social Security Administration Approved Disability. The
permanent and total disability of the Participant, as determined by the Social
Security Administration.

         1.59     Trust Agreement. The trust agreement entered into between the
Company and the Trustee which establishes the Trust Fund and is considered a
part of this Plan, as amended from time to time.

         1.60     Trust Fund. The fund established by the Trustee in accordance
with the Trust Agreement to hold the assets of this Plan.

         1.61     Trustee. Any person or persons acting from time to time as
the trustee of the Trust Fund in accordance with the Trust Agreement.

         1.62     Valuation Date. The last day of each calendar quarter, or
such more frequent period as designated by the Plan Administrator.

         1.63     Year of Service.

         (a)      Effective January 1, 2002, and subject to the provisions of
Section 1.63(a)(ii) (which govern the transition from one method of service
computation to another), for the purposes of determining an Employee's vested
interest in the participant's account balance derived from employer
contributions, an Employee will receive credit for the aggregate of all time
period(s) commencing with the Employee's first day of employment or
reemployment and ending on the date a break in service begins. The first day of
employment or reemployment is the first day the Employee performs an hour of
service. An Employee will also receive credit for

                                      I-9
<PAGE>
any period of severance of less than 12 consecutive months. Fractional periods
of a year will be expressed in terms of days.

                  (i)      For purposes of this Section 1.63(a), the following
         definitions shall apply:

                           (A)      Hour of service shall mean each hour for
                  which an Employee is paid or entitled to payment for the
                  performance of duties for the Employer.

                           (B)      Break in service is a period of severance
                  of at least 12 consecutive months. In the case of an
                  individual who is absent from work for maternity or paternity
                  reasons, the 12-consecutive month period beginning on the
                  first anniversary of the first date of such absence shall not
                  constitute a break in service. For purposes of this
                  paragraph, an absence from work for maternity or paternity
                  reasons means an absence (i) by reason of the pregnancy of
                  the individual, (ii) by reason of the birth of a child of the
                  individual, (iii) by reason of the placement of a child with
                  the individual in connection with the adoption of such child
                  by such individual, or (iv) for purposes of caring for such
                  child for a period beginning immediately following such birth
                  or placement.

                           (C)      Period of severance is a continuous period
                  of time during which the Employee is not employed by the
                  Employer. Such period begins on the date the Employee
                  retires, quits or is discharged, or if earlier, the 12-month
                  anniversary of the date on which the Employee was otherwise
                  first absent from service.

                  (ii)     The "elapsed time" method set forth in this Section
         1.63(a) shall be used to determine the date upon which an Employee
         completes a Year of Service or such other period of service as may be
         required for the purposes of vesting under the Plan. Each Employee
         with respect to whom the method of crediting service is changed as a
         result of the adoption of this Section 1.63(a) shall be treated in
         accordance with the provisions of ss.ss. 1.410(a)-7(g) and
         1.410(a)-7(f) of the Treasury Regulations, the provisions of which are
         incorporated by reference.

         (b)      Effective June 1, 1994, for purposes of determining
eligibility to participate in this Plan under Section 2.1(a), an Employee
shall be credited with a Year of Service if he completes one thousand (1,000)
or more Hours of Service with the Employer or an Affiliate during the
12-consecutive-month period beginning on his Employment Commencement Date, or
during any Plan Year, beginning with the Plan Year in which the first
anniversary of his Employment Commencement Date occurs.

         (c)      Reserved.

         (d)      Effective prior to January 1, 2002, for purposes of
determining the vested percentage of any Employee in his Employer Matching
Contribution Account under Section 5.1(c)(ii), each Plan Year during which he
completes one thousand (1,000) or more Hours of Service with the Employer or an
Affiliate shall count as a Year of Service.

                                     I-10
<PAGE>
         (e)      Ohio and Iowa Paper Employees.

                  (i)      If an individual became an Employee as a result of
         the acquisition of one of the following companies, then such
         Employee's Years of Service with the acquired company shall be counted
         as Years of Service under this Plan:

                  Acquired Company                    Renamed As:

                  Rittman, Ohio Paper Mill            Rittman Paperboard
                  Tama, Iowa Paper Mill               Tama Paperboard
                  Cleveland, Ohio Paper Stock         Cleveland Paper Stock

                  (ii)     The accounts of participants in the plans maintained
         by the above acquired companies shall be transferred to the Plan in
         accordance with Code Section 414(l) and 411(d)(6) as soon as is
         reasonably possible and the Caraustar Plan Trustee shall accept such
         accounts.

                  (iii)    Notwithstanding Section 2.1(a), any Employee
         described in Section 1.63(e)(i) who has completed a Year of Service
         and is at least age twenty-one (21) as of August 31, 1996, shall be
         allowed to participate in the Plan on September 1, 1996.

         (f)      Garber Company and Special Packaging, Inc. If an individual
became an Employee as a result of the acquisition of Garber Company or Special
Packaging, Inc., then such Employee's Years of Service with the acquired
company shall be counted as Years of Service for all purposes under this Plan.

         (g)      Employees of General Packaging Service, Inc., Oak Tree
Packaging Corporation, Etowah Recycling, Inc., Chesapeake Paperboard Company,
and Chesapeake Fiber Packaging Corporation.

                  (i)      If an individual became an Employee as the result of
         the acquisition of any of the companies listed immediately above, such
         Employee's Years of Service with the acquired company shall be counted
         as Years of Service for all purposes under this Plan.

                  (ii)     Notwithstanding Section 2.l(a), any Employee
         described in Section 1.63(g)(i) who has completed a Year of Service
         and is at least twenty-one (21) as of the acquisition date shall be
         allowed to participate in the Plan as of next Plan entry date
         following the acquisition date of the company.

         (h)      If an individual became an Employee as a result of the
acquisition of Mil Pak, Inc., Arrow Paper Products Company or Crane Carton
Company, then such Employee's Years of Service with the acquired company
shall be counted as Years of Service for all purposes under this Plan.

         (i)      If an individual became an employee as a result of the
acquisition of any of the following companies or plants, then such Employee's
Years of Service with the acquired company or plant shall be counted as Years
of Service for all purposes under this Plan: Carolina

                                     I-11
<PAGE>
Converting, Inc., Carolina Component Concepts, Halifax Paperboard, Sprague,
CCP-Denver, CCP-Grand Rapids, CCP-Mentor, CCP-Salt Lake City and CCP-St. Louis.

         (j)      If an individual was an Employee of Premier Boxboard Limited,
LLC on June 26, 2000, such Employee's Years of Service with Premier Boxboard
Limited, LLC and Inland Paperboard and Packaging, Inc. shall be counted as
Years of Service for all purposes under this Plan.

         (k)      If an individual was an employee of Arrow Paper Products
Company ("Arrow") on September 28, 2000, and became an Employee on September
29, 2000 as a result of the merger of Arrow into Caraustar Industrial and
Consumer Products Group, Inc., such Employee's Years of Service with Arrow shall
be counted as Years of Service for all purposes under this Plan.

         (l)      If an individual became an Employee as a result of the
acquisition of certain assets of the Jefferson Smurfit Corporation (U.S.)
pursuant to the Asset Purchase Agreement dated as of July 22, 2002, such
Employee's Years of Service with Jefferson Smurfit Corporation (U.S.) or a
member of its controlled group shall be counted as Years of Service for all
purposes under this Plan.

                                     I-12
<PAGE>
                                   ARTICLE II

                                 PARTICIPATION

         2.1      Participation.

         (a)      General Rule.

                  (i)      Effective October 1, 1999, and subject to Section
         2.1(c), an Employee who is (A) employed by the Company, or (B) employed
         by another Employer and (in any case) whose principal place of
         employment is listed in Appendix A to the Plan, shall be eligible to
         participate in the Plan if he has attained the age of twenty-one (21)
         and is either (1) classified as "full-time" on the payroll records of
         an Employer and has completed the period of eligibility service as set
         forth in Appendix A, or (2) classified as "part-time" on the payroll
         records of an Employer and has completed one Year of Service (as
         defined in Section 1.63(b)). However, effective January 1, 2003, age
         "eighteen (18)" shall replace age "twenty-one (21)" in the first
         sentence of this paragraph (and all other provisions of such sentence
         shall remain unchanged). Once eligible, an Employee may begin
         participation as soon as is administratively feasible, which date shall
         be no later than the first day of the second month following the date
         he becomes eligible to participate in the Plan (the "entry date"),
         provided he is an Employee on such entry date. The Plan Administrator
         shall update Appendix A as necessary so as to properly reflect the
         eligibility requirements applicable to full-time Employees.

                  (ii)     Effective June 1, 1994, through September 30, 1999
         and subject to Section 2.1(c), an Employee of an Employer shall be
         eligible to participate in the Plan after completing one (1) Year of
         Service and attaining age twenty-one (21). Once eligible, he shall
         begin participation on the earlier of the first day of the Plan Year
         or the three (3), six (6) or nine (9) month anniversary of the first
         day of the Plan Year (entry date) to occur after the date he becomes
         eligible, provided he is an Employee on such entry date.

         (b)      Reserved.

         (c)      Excluded Employees.

                  (i)      No Employee shall participate in this Plan as long
         as he is a "leased employee" of the Employer within the meaning of
         Code Sections 414(n) and (o).

                  (ii)     No Employee shall participate in this Plan as long as
         he is a person for whom retirement benefits have been the subject of
         good faith collective bargaining resulting in their exclusion from this
         Plan; provided, however, employees who are members of a union may
         participate if that union and the Employer mutually agree to such
         participation as a result of collective bargaining. Such agreement
         shall be documented in a written collective bargaining agreement.
         Furthermore, where such a collective bargaining agreement establishes
         terms of participation in, or benefits under, the Plan applicable to
         Employees covered by such agreement, the terms of such agreement shall
         govern, notwithstanding contrary provisions of this Plan.

                  (iii)    No Employee shall participate in this Plan as long
         as he is a nonresident alien (within the meaning of Code Section
         410(b)(3)(C)).

                                     II-1
<PAGE>
                  (iv)     No Employee shall participate in this Plan as long
         as he is identified on an Employer's payroll as other than a common
         law employee regardless of later agency or judicial determination
         otherwise.

         (d)      Interruption of Employment.

                  (i)      If an Employee becomes eligible to participate under
         the terms of the Plan but, prior to becoming a Participant, he becomes
         an excluded employee under Section 2.1(c) or his employment with the
         Employer is interrupted, then he shall become a Participant as of the
         later of the entry date following (a) the date he ceases to be an
         excluded employee, or (b) his Reemployment Commencement Date.

                  (ii)     If a Participant's employment is interrupted he
         shall be reinstated as a Participant as of his Reemployment
         Commencement Date.

         2.2      Participant Information. Each person who becomes a
Participant shall file with the Plan Administrator such personal information,
data and elections as the Plan Administrator deems necessary for the orderly
administration of this Plan and the payment of benefits under this Plan,
including the designation of a Beneficiary and his initial deferral and
investment elections. If an Employee does not make investment elections, his
Account shall be invested in the investment (or investments) designated as the
default investment by the Plan Administrator.

                                     II-2
<PAGE>
                                  ARTICLE III

                                 CONTRIBUTIONS

         3.1      Income Deferral Contributions. A Participant may elect to
either defer a percent of his Compensation as set forth in this Section or
receive that amount in cash. Income Deferral Contributions shall be by payroll
deduction on behalf of the Participant in accordance with Code Section 401(k)
for each Plan Year, and shall commence and end coincident with the beginning
and end of the Participant's payroll period.

         (a)      Election Rules.

                  (i)      General Rules. A Participant who is an Employee may
         make an initial, modified or suspended election with the Plan
         Administrator at such time and in such way as the Plan Administrator
         determines. An election also shall terminate automatically when an
         Employee is no longer eligible to participate in the Plan under
         Section 2.1, or when a Participant terminates his employment with the
         Employer or upon his Total and Permanent Disability. If, after
         terminating contributions, a Participant wants to resume making
         contributions, the Participant may elect to resume making
         contributions, provided, however, that the Participant will not
         re-enter the Plan until the next entry date (under Section 2.1(a))
         after such election.

                  (ii)     Negative Election. If a non-collectively bargained
         Employee's date of hire is on or after July 1, 2001, after the
         Employee satisfies the eligibility requirements of Section 2.1 and
         completes 90 days of employment, the Employer will automatically begin
         making Income Deferral Contributions on behalf of the Employee in an
         amount equal to 2% of the Employee's Compensation for each payroll
         period, unless the Employee elects not to contribute or to contribute
         a different amount by notifying the Employer. The Employer will
         provide the Employee with a written notice explaining the automatic
         Income Deferral Contributions, the Employee's right to have no Income
         Deferral Contributions made to the Plan, the Employee's right to alter
         the amount of the Income Deferral Contributions made to the Plan, and
         the procedure and timing for making these elections.

                  (iii)    Suspension Following Hardship Withdrawals. If a
         withdrawal on account of hardship is approved by the Plan
         Administrator and paid to the Participant under Section 5.5, then:

                           (A)      The Participant's Income Deferral
                  Contributions and Employee After-Tax Contributions, and any
                  elective contributions and employee contributions under any
                  other plan of the Company, shall be suspended for the
                  12-month period after receipt of the withdrawal; and

                           (B)      The Participant may not make Income
                  Deferral Contributions under the Plan or elective
                  contributions under any other plan of the Company for the
                  participant's taxable year immediately following the taxable
                  year of the withdrawal in excess of the applicable limit
                  under Internal Revenue Code

                                     III-1
<PAGE>
                  ss. 402(g) for such next taxable year less the amount of such
                  Participant's total Income Deferral Contributions and other
                  elective contributions for the year of the withdrawal.

         (b)      Percentage Limitation. Each Participant's election shall be
stated as a whole percentage point from one percent (1%) to twenty-five percent
(25%) of his Compensation for such year, measured from the date such Income
Deferral Contributions begin. However, in lieu of the 25% limitation set forth
in the previous sentence, the following limitations shall apply as of the dates
indicated: (i) effective January 1, 2003, Employees with Compensation of $90,000
or more during the prior Plan Year may elect to contribute up to 6% of
Compensation; and (ii) prior to January 1, 2003, the limits set forth in
Appendix B shall apply. The Employer has the right to increase or decrease the
percentage limits in its sole discretion, provided the Employer notifies the
Participants of the change in advance, and such increase or decrease is
effective as of the first pay period which begins immediately after the next
Valuation Date.

         (c)      Reserved.

         (d)      Vesting. All Income Deferral Contributions are always
nonforfeitable.

         (e)      Contribution Timing. The Employer shall deliver such Income
Deferral Contributions to the Trustee as soon as such amounts may be
practicably segregated after the end of the payroll period for which they were
withheld, which shall be no later than the 15th business day of the month
following the month in which such amounts would otherwise have been payable to
the Participant in cash (or such other date as may be established in 29 C.F.R.
ss. 2510.3-102(b) or superseding authority).

         3.2      Employee After-Tax Contributions.

         (a)      General Rules. A Participant may elect to make Employee
After-Tax Contributions as set forth in this Section by payroll deduction, and
such deductions shall commence and end coincident with the beginning and end of
the Participant's payroll period. A Participant may make Employee After-Tax
Contributions without making Income Deferral Contributions. All such
contributions shall be nonforfeitable. A Participant may discontinue such
payroll deduction contributions at such time and in such way as the Plan
Administrator determines; provided, however, the Participant shall not make
additional Employee After-Tax Contributions through payroll deductions until
the first entry date following three (3) full months after such filing.
(However, a Participant who discontinued such contribution prior to June 1,
1994, shall not make additional Employee After-Tax Contributions through
payroll deductions until the first day of a month following six (6) full months
after such filing.) A Participant may change the amount of his Employee After-
Tax Contributions being made by him by regular payroll deductions at such time
and in such way as the Plan Administrator determines. No additional changes to
the Participant's After-Tax Contributions may be made until three (3) full
months following such change. In the event that a Participant makes a hardship
withdrawal under Section 5.5, the suspension provisions of Section 3.1(a)(iii)
shall apply.

         (b)      Contribution Limits. Each such Participant's Employee
After-Tax Contribution shall be made from his Compensation when paid, and shall
be in whole multiples of one percent (1%) to twenty-five percent (25%) of his
Compensation. The Employer has the right to increase or decrease the percentage
limits in its sole discretion, provided the Employer notifies the Participants
of the change in advance, and such increase or decrease is effective as of the
first pay period which begins immediately after the next Valuation Date.

         (c)      Contribution Timing. The Employer shall deliver such
Employee After-Tax Contributions to the Trustee as soon as such amounts may be
practicably segregated, which shall be no later than the 15th business day of
the month following the month in which such amounts

                                     III-2
<PAGE>
would otherwise have been payable to the Participant in cash (or such other
date as may be established in 29 C.F.R. ss. 2510.3-102(b) or superseding
authority).

         3.3      Employer Matching Contributions.

         (a)      Amount. The Employer shall (subject to the limitations set
forth in Sections 3.3(b), and 3.6 through 3.11) make Employer Matching
Contributions from the Employer's profits as of each day the Employer delivers
to the Trustee the Income Deferral Contributions pursuant to Section 3.1(e) on
behalf of each Participant for whom Income Deferral Contributions were made on
such date in an amount equal to the lesser of (i) fifty percent (50%) of the
Participant's Income Deferral Contributions made on such date, or (ii) three
percent (3%) of the Employee's Compensation from which the Income Deferral
Contributions deposited on that date were made. Effective prior to April 1,
2000, clause (ii) provided for matching contributions equal to "two percent
(2%)" rather than "three percent (3%)."

         (b)      No Matching for Excess Income Deferral Contributions. No
Employer Matching Contributions shall be made with respect to Income Deferral
Contributions that exceed the dollar limit in Section 3.8 and, if Employer
Matching Contributions are allocated to an Employer Matching Account for a Plan
Year before the Employer determines that any part of such Matching
Contributions are attributable to excess Income Deferral Contributions, the
Employer promptly shall withdraw such part of the Employer Matching
Contributions and treat it as a Forfeiture under this Plan unless his Matching
Contribution Account had been distributed before the Employer made such
determination. Amounts forfeited by Participants under this Section 3.3(b)
shall be treated as provided in Section 5.1(c)(v).

         3.4      Rollover Contributions. Effective June 1, 1994, a Plan
Participant or an Employee who would be eligible to participate if he had
completed the requirements of Plan Section 2.1 shall be permitted to transfer
(or directly cause to be transferred) to the Trust Fund, and the Trustee shall
accept:

         (a)      the redemption proceeds of a retirement bond,

         (b)      all or any portion of cash received by him in one or more
distributions from or under one or more other trusts or plans qualified under
Code Section 401(a) or employee annuities or custodial accounts, each
constituting an eligible rollover distribution, as defined in Code Section
402(c), exclusive of contributions, other than voluntary deductible
contributions as described in Code Section 72(o)(5) made by the Participant as
an employee or participant under the distributing plan,

         (c)      an amount paid or distributed out of an individual retirement
account or individual retirement annuity or retirement bond constituting the
entire balance of the Participant in such account, annuity or bond and
consisting solely of a prior rollover contribution under Code Section 402(c)
from a qualified trust or annuity plan qualified under Code Section 401(a) and
income attributable to such amount,

         (d)      cash representing his entire account or benefits in another
plan or trust qualified under Code Section 401(a), which shall be transferred
directly from said plan or trust to the Trust Fund,

                                     III-3
<PAGE>
         (e)      common or preferred stock of Caraustar Industries, Inc., or

         (f)      any combination of the above;

provided, however, such transfer must satisfy the requirements of Code Section
402(c). All contributions under this Section shall be nonforfeitable.

         3.5      Cessation of Employer Contributions. Effective as of January
1, 1990, all Employer contributions ceased (except amounts contributed pursuant
to salary reduction agreements, Employer Matching Contributions and Special
Transition Contributions). Account balances with respect to such pre-1990
contributions were transferred to, and are now accounted for in, the Employer
Matching Contribution Account.

         3.6      Reversion of Contributions.

         (a)      Mistake of Fact. If any contributions are made by the
Employer by reason of a mistake of fact, such contributions shall be returned
to the Employer upon discovery of such mistake, if discovered and returned
within one (1) year after the payment of such contributions.

         (b)      Deduction. If the Internal Revenue Service determines that
any contributions are nondeductible under Code Section 404, then such
contributions, to the extent that they are determined to be nondeductible,
shall be refunded to the Employer within one (1) year of the date of
disallowance of such deduction, all such contributions being conditioned upon
their deductibility.

         3.7      Special Transition Contribution.

         (a)      Eligibility For Contribution. The Employer shall, following
the end of each Plan Year (subject to the limits of Sections 3.3(b), 3.6 and 3.8
through 3.11), make a Special Transition Contribution to the Employer
Contribution Account of each individual who is an Employee on the final day of
the Plan Year, provided that such individual was a salaried employee of Premier
Boxboard Limited, LLC on June 26, 2000, and provided further that such
individual does not incur a Break in Service after June 26, 2000.

                                     III-4
<PAGE>
         (b)      Amount. The amount of any Special Transition Contribution
shall be the applicable percentage of an eligible Employee's Compensation for
the Plan Year, provided that for the Plan Year ending on December 31, 2000, the
amount of any Special Transition Contribution shall be the applicable
percentage of an eligible Employee's Compensation for the period of June 27,
2000 through December 31, 2000. The applicable percentages for the purposes of
computing the Special Transition Contributions are set forth below, and are
based upon an eligible Employee's Years of Service as of July 1, 2000. For each
Plan Year, any Special Transition Contribution shall be based upon an eligible
Employee's Years of Service as of July 1, 2000.

<TABLE>
<CAPTION>
                  Years of             Percent of
                   Service            Compensation
                  --------            ------------
                  <S>                 <C>
                    25 +                   5%
                   20-24                   4%
                   15-19                   3%
                    5-14                   2%
                    0-4                    0%
</TABLE>

         (c)      Contribution Timing. Any Special Transition Contribution for
a Plan Year shall be made no later than the time prescribed by law for filing
the Employer's federal income tax return for the taxable year that includes the
final day of such Plan Year (including extensions thereof).

         (d)      Effective Date. This Section 3.7 shall be effective as of
June 27, 2000.

         3.8      Section 415 Limitations.

         (a)      Definitions. For purposes of this Section, the following
definitions shall apply:

                  (i)      Annual Addition. For each Participant the sum of the
         following amounts credited to his account for the Limitation Year:

                           (A)      Any employer contributions, Employee
                  After-Tax Contributions, Income Deferral Contributions
                  (including Income Deferral Contributions that are distributed
                  to the Participant, recharacterized or forfeited pursuant to
                  Sections 3.10(c) and 3.11(d), or Income Deferral
                  Contributions in excess of the applicable limit that are not
                  distributed) and forfeitures to any account of his in this or
                  any other Defined Contribution Plan required to be aggregated
                  with this Plan under Code Section 415(g) as of such date in
                  such Plan Year;

                           (B)      any contributions after March 31, 1984 by
                  the Employer or any other Affiliate allocated to his medical
                  account (as defined in Code Section 415(1)(2)) under any
                  Defined Benefit Plan or annuity plan maintained by the
                  Employer or any other Affiliate; and

                           (C)      any contributions paid or accrued after
                  December 31, 1985 by the Employer or any other Affiliate
                  which are attributable to post-retirement medical

                                     III-5
<PAGE>
                  or life insurance benefits allocated to him while he was a
                  "key employee" (as defined in Code Section 419A(d)(3)).

                  (ii)     Annual Compensation. For each Employee, his wages as
         defined in Code Section 3401(a) for purposes of income tax withholding
         at the source but determined without regard to any rules that limit the
         remuneration included in wages based on the nature or location of
         employment or services performed for the Plan Year. The dollar limit
         for Plan Years beginning after December 31, 1988, but before January 1,
         1994, shall not exceed $200,000 (before being adjusted), and for Plan
         Years beginning after December 31, 1993, the dollar limit shall not
         exceed $150,000 (before being adjusted). For Plan Years beginning on
         and after January 1, 1998, Annual Compensation shall also include any
         elective deferral (as defined in Code Section 402(g)(3)) and any amount
         which is contributed or deferred by an Employer at the election of the
         Employee and which is not includible in the gross income of the
         Employee by reason of Code Section 125, 132(f)(4) or 457.

         In the case of an employee of two or more corporations which are
         members of a controlled group of corporations (as defined in Section
         414(b) of the Code as modified by Section 415(h) of the Code) that
         includes the Company, the term "compensation" for such employee
         includes compensation from all corporations that are members of the
         controlled group, regardless of whether the employee's particular
         employer has a qualified plan. This special rule is also applicable to
         an employee of two or more trades or businesses (whether or not
         incorporated) which are under common control (as defined in Section
         414(c) of the Code as modified by Section 415(h) of the Code) or which
         are members of as affiliated service group (within the meaning of
         Section 414(m) or Section 414(o) of the Code).

                  (iii)    Reserved.

                  (iv)     Reserved.

                  (v)      Limitation Year. The Plan Year.

         (b)      Limitations.

                  (i)      In General. The sum of the Annual Addition of a
         Participant and all annual additions (as defined in Code Section
         415(c)(2)) to any account of his in any other Defined Contribution
         Plan required to be aggregated with this Plan under Code Section
         415(g) for a Plan Year in no event whatsoever shall exceed the lesser
         of (A) twenty-five percent (25%) of his Annual Compensation for such
         Plan Year or (B) $30,000 (as adjusted for inflation from time to time
         for a Plan Year by the Secretary of the Treasury under Code Section
         415(d)(l)).

                  (ii)     Reserved.

                                     III-6
<PAGE>
         (c)      Adjustments.

                  (i)      Any adjustment required to satisfy the limitations
         set forth in Code Section 415 as a result of a Participant's
         participation in another Defined Contribution Plan shall be made to
         his Annual Addition under this Plan.

                  (ii)     If the Plan Administrator determines that the
         allocation of contributions to the Account of a Participant will
         cause the Annual Addition for that Participant to exceed the
         limitations set forth in Section 3.8(b) and that an adjustment to
         contributions under this Plan is required to satisfy Section 3.8(b),
         the Plan Administrator, before such allocation:

                           (A)      shall direct that any Employee After-Tax
                  Contributions be returned to the Participant to the extent
                  necessary to satisfy Section 3.8(b) and, if such Section is
                  not satisfied by such transfer, it

                           (B)      shall direct that any Income Deferral
                  Contributions be distributed to the Participant to the extent
                  necessary to satisfy Section 3.8(b) and, if such Section is
                  not satisfied by such transfer, it

                           (C)      shall direct that, if the Participant is
                  covered by the Plan at the end of the Limitation Year, the
                  excess amount in the Participant's Account will be used to
                  reduce Employer contributions (including any allocation of
                  forfeitures) for such Participant in the next Limitation
                  Year, and each succeeding Limitation Year, if necessary to
                  satisfy Section 3.8(b) and, if such Section is not satisfied,
                  it

                           (D)      shall direct that if the Participant is not
                  covered by the Plan at the end of the Limitation Year, the
                  excess amount will be held unallocated in a suspense account,
                  and the suspense account will be applied to reduce future
                  Employer contributions for all remaining Participants in the
                  next Limitation Year and each succeeding Limitation Year if
                  necessary to satisfy Section 3.8(b).

         If a suspense account is in existence at any time during a Limitation
         Year pursuant to this Section, it will not participate in the
         allocation of gains or losses. If a suspense account is in existence
         at any time during a particular Limitation Year, all amounts in the
         suspense account must be allocated and reallocated to Participant's
         Accounts before any contributions which constitute an Annual Addition
         may be made to the Plan for that Limitation Year. Excess amounts may
         not be distributed to Participants or former Participants.

         Thereafter, adjustment shall be made to any other Defined Contribution
         Plan in which the Participant participates.

         3.9      Dollar Limitation on Income Deferral Contributions.

         (a)      Dollar Limitation Will Not Be Exceeded. The Income Deferral
Contributions of a Participant under the Plan and all other plans, contracts or
arrangements of the Employer maintaining the Plan may not exceed $7,000
(increased beginning in 1988 under Code Section

                                     III-7
<PAGE>
415(d)(l), as provided in Code Section 402(g)) (the "alternative limit") for
the Participant's taxable year beginning in the calendar year. Income Deferral
Contributions in excess of the applicable limit ("excess Deferral") (and excess
Contributions under Section 3.10(c) distributed or recharacterized for an
Employee with respect to the Plan Year beginning with or within the taxable
year) that are distributed pursuant to one of the corrective methods described
in Section 3.9(b) are disregarded when determining whether the $7,000 limit (as
adjusted) is exceeded.

         (b)      Corrective Measures. If there are excess Deferrals for any
Participant during the Participant's taxable year beginning in the calendar
year, then the following steps (in the order and at the time determined by the
Plan Administrator) may be taken:

                  (i)      During the Taxable Year. A distribution of excess
         Deferrals may be made to a Participant during the taxable year in
         which such excess occurs if the following conditions are satisfied:

                           (A)      The Participant certifies in writing that
                  the designated amount to be distributed is an excess
                  Deferral. A Participant is deemed to have designated the
                  distribution to the extent he has excess Deferrals for the
                  taxable year after combining all the plans of the Employer or
                  an Affiliate.

                           (B)      The correcting distribution is made after
                  the date on which the Plan received the excess Deferrals.

                           (C)      The Plan designates the distribution as a
                  distribution of excess Deferrals.

                  (ii)     After the Taxable Year. A distribution of excess
         Deferrals may be made to a Participant after the taxable year in which
         such excess occurs if:

                           (A)      Not later than March 1 following the close
                  of the Participant's taxable year, the Participant provides
                  each plan under which deferrals were made with a written
                  certificate stating the amount of the excess deferrals
                  received by that plan. The Employer may notify the Plan of a
                  Participant's excess Deferrals to the extent he has excess
                  Deferrals for the taxable year after combining all the plans
                  of the Employer or an Affiliate.

                           (B)      Not later than the first April 15 following
                  the close of the Participant's taxable year, the Plan will
                  distribute to the Participant the amount designated in the
                  preceding paragraph (plus any income allocable to that
                  amount), less any excess Deferrals or excess Contributions
                  previously distributed or recharacterized for the Participant
                  for the Plan Year beginning with or within the taxable year.
                  If the excess Deferrals (and any income) are not distributed
                  by this April 15, then a corrective distribution under this
                  Section 3.9(b) shall not be permitted.

         (c)      Method for Allocating Income to Excess Deferrals. The amount
of income to be allocated to excess Deferrals equals the income for the taxable
year allocable to Income Deferral

                                     III-8
<PAGE>
Contributions times a fraction. The numerator of the fraction is the excess
Income Deferral Contribution made by the Participant for the taxable year. The
denominator of the fraction is the total Account balance of the Participant
attributable to Income Deferral Contributions at the beginning of the taxable
year, plus the Participant's Income Deferral Contributions for the taxable
year. No income shall be allocated to the excess Deferrals for the period after
the end of the taxable year.

         3.10     Actual Deferral Percentage Test.

         (a)      Actual Deferral Percentage Defined. For each Plan Year the
"Actual Deferral Percentage" is the ratio, calculated to the nearest
one-hundredth of one percent (1/100%), obtained for each Participant by
dividing (i) by (ii) where (i) and (ii) are:

                  (i)      The amount of Employer Contributions actually paid
         over to the Trust Fund on behalf of such Participant for the Plan
         Year.

                  (ii)     The Participant's Compensation for such Plan Year.

                  (iii)    Definitions and Special Rules. For the purposes of
         this Section 3.10(a) and Sections 3.10(b) and 3.10(c), the following
         definitions and special rules apply:

                           (A)      A Participant is a Highly Compensated
                  Employee for a particular Plan Year if he or she meets the
                  definition of a Highly Compensated Employee in effect for
                  that Plan Year. Similarly, a Participant is a Non-Highly
                  Compensated Employee for a particular Plan Year if he or she
                  does not meet the definition of a Highly Compensated Employee
                  in effect for that Plan Year.

                           (B)      The Actual Deferral Percentage for any
                  Participant who is a Highly Compensated Employee for the Plan
                  Year and who is eligible to have Income Deferral
                  Contributions (and qualified non-elective contributions or
                  qualified matching contributions, or both, if treated as
                  Income Deferral Contributions for purposes of the actual
                  deferral percentage test) allocated to his or her accounts
                  under two or more arrangements described in Section 401(k) of
                  the Code, that are maintained by the Employer, shall be
                  determined as if such Income Deferral Contributions (and, if
                  applicable, such qualified non-elective contributions or
                  qualified matching contributions, or both) were made under a
                  single arrangement. If a Highly Compensated Employee
                  participates in two or more cash or deferred arrangements
                  that have different Plan Years, all cash or deferred
                  arrangements ending with or within the same calendar year
                  shall be treated as a single arrangement. Notwithstanding the
                  foregoing, certain plans shall be treated as separate if
                  mandatorily disaggregated under regulations under Section
                  401(k) of the Code.

                           (C)      In the event that this Plan satisfies the
                  requirements of Sections 401(k), 401(a)(4), or 410(b) of the
                  Code only if aggregated with one or more other plans, or if
                  one or more other plans satisfy the requirements of such
                  sections of the Code only if aggregated with this Plan, then
                  Sections 3.10(a) and 3.10(b) shall be applied by determining
                  the Actual Deferral Percentage of Employees as if

                                     III-9
<PAGE>
                all such plans were a single plan. Any adjustments to the
                Non-Highly Compensated Employee Actual Deferral Percentage for
                the prior year will be made in accordance with IRS Notice 98-1
                and any superseding guidance, unless the Plan Administrator has
                elected to use the current year testing method. Plans may be
                aggregated in order to satisfy Section 401(k) of the Code only
                if they have the same Plan Year and use the same actual
                deferral percentage testing method (current year testing method
                or prior year testing method).

                           (D)      For the purposes of the actual deferral
                  percentage test, Income Deferral Contributions, qualified
                  non-elective contributions and qualified matching
                  contributions will be considered to have been made for a Plan
                  Year if made no later than the end of the 12-month period
                  beginning on the day after the close of such Plan Year.

                           (E)      The employer shall maintain records
                  sufficient to demonstrate satisfaction of the actual deferral
                  percentage test and the amount of qualified non-elective
                  contributions or qualified matching contributions, or both,
                  used in such test.

                           (F)      "Employer Contributions" on behalf of any
                  Participant shall include: (1) any Income Deferral
                  Contributions made pursuant to the Participant's deferral
                  election (including excess Income Deferral Contributions of
                  Highly Compensated Employees), but excluding (a) excess
                  Income Deferral Contributions of Non-Highly Compensated
                  Employees that arise solely from Income Deferral
                  Contributions made under the Plan or plans of the Employer
                  and (b) Income Deferral Contributions that are taken into
                  account in the actual contribution percentage test (provided
                  the actual deferral percentage test is satisfied both with
                  and without exclusion of these Income Deferral
                  Contributions); and (2) as elected by the Plan Administrator
                  and to the extent not taken into account for purposes of the
                  actual contribution percentage test, qualified non-elective
                  contributions and qualified matching contributions. For
                  purposes of computing Actual Deferral Percentages, an
                  Employee who would be a Participant but for the failure to
                  make Income Deferral Contributions shall be treated as a
                  Participant on whose behalf no Income Deferral Contributions
                  are made.

                           (G)      To the extent not expressly provided for in
                  this Section 3.10(a) or in Section 3.10(b), the provisions of
                  Code Sections 401(k)(3) and 401(m)(9) and Treasury
                  Regulations Sections 1.40l(k)-l(b) and 1.401(m)-2 (and any
                  subsequent IRS guidance issued under the above Code Sections)
                  are, to the extent applicable, incorporated by reference.

         (b)      ADP Test. The actual deferral percentage test shall be
satisfied each Plan Year. Such test shall be satisfied only if:

                  (i)      The average Actual Deferral Percentage for eligible
         participants who are Highly Compensated Employees for the Plan Year
         does not exceed the prior year's

                                    III-10
<PAGE>
         average Actual Deferral Percentage for eligible participants who were
         Non-Highly Compensated Employees for the prior Plan Year multiplied by
         1.25; or

                  (ii)     The average Actual Deferral Percentage for eligible
         participants who are Highly Compensated Employees for the Plan Year
         does not exceed the prior year's average Actual Deferral Percentage
         for eligible participants who were Non-Highly Compensated Employees
         for the prior Plan Year multiplied by 2, provided that the Actual
         Deferral Percentage for eligible participants who are Highly
         Compensated Employees does not exceed the prior year's Actual Deferral
         Percentage for eligible participants who were Non-Highly Compensated
         Employees for the prior Plan Year by more than 2 percentage points.

For purposes of this Section 3.10(b), the average Actual Deferral Percentage
for each group shall be calculated to the nearest one-hundredth of one percent
(1/100%).

The actual deferral percentage test may be applied by the Plan Administrator on
the basis of any elective provision permitted under Code Section 401(k) or
under any regulation, notice or other guidance issued by the U.S. Treasury
Department thereunder. The Plan may apply this Section 3.10(b) under the
current year testing method (if the Plan Administrator so elects), whereby the
actual deferral percentage tests in paragraphs (i) and (ii) above will be
applied by comparing the current Plan Year's Actual Deferral Percentage for
participants who are Highly Compensated Employees with the current Plan Year's
Actual Deferral Percentage for all eligible participants who are Non-Highly
Compensated Employees. The Plan Administrator elected to use the current year
testing method for its Plan Years beginning January 1, 1997, January 1, 1998,
and January 1, 1999. The Plan Administrator elected to use the prior year
testing method for its Plan Year beginning January 1, 2000. The Plan
Administrator hereby elects current year testing for its Plan Year beginning
January 1, 2001, and for each Plan Year thereafter, which election shall not be
changed except as provided in IRS Notice 98-1 (or superseding guidance).

With respect to each plan merged into this Plan pursuant to Articles XVI, XVII
and XVIII, the current year testing method was used, prior to such merger, for
all applicable plan years.

         (c)      Corrective Measures If ADP Test Failed. If the Plan fails or
is projected to fail the ADP Test, then the Plan Administrator shall take one
or more of the following steps (in any order it deems advisable):

                  (i)      Limit Future Income Deferral Contributions. The Plan
         Administrator may limit future Income Deferral Contributions for some
         or all Highly Compensated Employees to the extent it deems advisable
         to meet the ADP Test. Such limits shall be made with respect to Highly
         Compensated Employees in order of the individual actual deferral
         percentages, beginning with the highest of such percentages.

                  (ii)     Return Excess Income Deferral Contributions.

                           (A)      Notwithstanding any other provision of the
                  Plan, Excess Contributions, plus any income and minus any
                  loss allocable thereto, shall be distributed no later than
                  the last day of each Plan Year to Participants to whose
                  Accounts such Excess Contributions were allocated for the
                  preceding Plan Year.

                                    III-11
<PAGE>
                  (If such excess amounts are distributed more than 2 1/2 months
                  after the last day of the Plan Year in which such excess
                  amounts arose, a 10-percent excise tax will be imposed on the
                  employer maintaining the Plan with respect to such amounts.)
                  Excess Contributions are allocated to the Highly Compensated
                  Employees with the largest amounts of employer contributions
                  taken into account in calculating the actual deferral
                  percentage test for the year in which the excess arose,
                  beginning with the Highly Compensated Employee with the
                  largest amount of such employer contributions and continuing
                  in descending order until all the Excess Contributions have
                  been allocated. For purposes of the preceding sentence, the
                  "largest amount" is determined after distribution of any
                  Excess Contributions. The amount of Excess Contributions to
                  be distributed with respect to an Employee for a Plan Year
                  shall be reduced by any excess deferrals previously
                  distributed to the Employee for the Employee's taxable year
                  ending with or within the Plan Year in accordance with
                  Internal Revenue Code ss. 402(g)(2) and Section 3.9(b).
                  Excess Contributions (including any amounts recharacterized)
                  shall be treated as annual additions under the Plan.

                                    (1)      If the entire account balance of a
                           Highly Compensated Employee is distributed during
                           the Plan Year in which the excess arose, the
                           distribution is deemed to have been a corrective
                           distribution to the extent that a corrective
                           distribution would have been required.

                                    (2)      If part, but not all of a Highly
                           Compensated Employee's account balance is
                           distributed during the Plan Year in which an excess
                           arose, it is not deemed to have been a corrective
                           distribution.

                           (B)      The same method used in Section 3.9(c) for
                  allocating income and loss to excess deferrals shall be used
                  to allocate income and loss to Excess Contributions.

         3.11     Actual Contribution Percentage Test.

         (a)      Actual Contribution Percentage Defined. For each Plan Year
the "Actual Contribution Percentage" is the ratio, calculated to the nearest
one-hundredth of one percent (1/100%), obtained for each Participant by
dividing (i) by (ii), where (i) and (ii) are:

                  (i)      The Contribution Percentage Amounts made under the
         Plan on behalf of the Participant for the Plan Year.

                  (ii)     The Participant's Compensation for such Plan Year.

                  (iii)    Definitions and Special Rules. For the purposes of
         this Section 3.11(a) and Sections 3.11(b) and 3.11(d), the following
         definitions and special rules apply:

                           (A)      A participant is a Highly Compensated
                  Employee for a particular Plan Year if he or she meets the
                  definition of a Highly Compensated Employee in effect for
                  that Plan Year. Similarly, a participant is a Non-Highly
                  Compensated

                                    III-12
<PAGE>
                  Employee for a particular Plan Year if he or she does not
                  meet the definition of a Highly Compensated Employee in
                  effect for that Plan Year.

                           (B)      The Actual Contribution Percentage for any
                  Participant who is a Highly Compensated Employee and who is
                  eligible to have Contribution Percentage Amounts allocated to
                  his or her account under two or more plans described in
                  Section 401(a) of the Code, or arrangements described in
                  Section 401(k) of the Code that are maintained by the
                  Employer, shall be determined as if the total of such
                  Contribution Percentage Amounts was made under each plan. If
                  a Highly Compensated Employee participates in two or more
                  cash or deferred arrangements that have different Plan Years,
                  all cash or deferred arrangements ending with or within the
                  same calendar year shall be treated as a single arrangement.
                  Notwithstanding the foregoing, certain plans shall be treated
                  as separate if mandatorily disaggregated under regulations
                  under Section 401(m) of the Code.

                           (C)      In the event that this Plan satisfies the
                  requirements of Sections 401(m), 401(a)(4) or 410(b) of the
                  Code only if aggregated with one or more other plans, or if
                  one or more other plans satisfy the requirements of such
                  sections of the Code only if aggregated with this Plan, then
                  Sections 3.11(a) and 3.11(b) shall be applied by determining
                  the Actual Contribution Percentage of Employees as if all
                  such plans were a single plan. Any adjustments to the
                  Non-Highly Compensated Employee Actual Contribution
                  Percentage for the prior year will be made in accordance with
                  IRS Notice 98-1 and any superseding guidance, unless the Plan
                  Administrator has elected to use the current year testing
                  method. Plans may be aggregated in order to satisfy Section
                  401(m) of the Code only if they have the same Plan Year and
                  use the same actual contribution percentage testing method.

                           (D)      For purposes of the actual contribution
                  percentage test, Employee After-Tax Contributions are
                  considered to have been made in the Plan Year in which
                  contributed to the Trust Fund. Employer Matching
                  Contributions, Income Deferral Contributions, qualified
                  matching contributions and qualified non-elective
                  contributions will be considered made for a Plan Year if made
                  no later than the end of the 12-month period beginning on the
                  day after the close of such Plan Year.

                           (E)      The Employer shall maintain records
                  sufficient to demonstrate satisfaction of the actual
                  contribution percentage test and the amount of qualified
                  non-elective contributions or qualified matching
                  contributions, or both, used in such test.

                           (F)      "Contribution Percentage Amounts" shall
                  mean the sum of the Employee After-Tax Contributions,
                  Employer Matching Contributions, and qualified matching
                  contributions (to the extent not taken into account for
                  purposes of the actual deferral percentage test) made under
                  the Plan on behalf of the Participant for the Plan Year. Such
                  Contribution Percentage Amounts shall not

                                    III-13
<PAGE>
                  include Employer Matching Contributions that are forfeited
                  either to correct Excess Aggregate Contributions or because
                  the contributions to which they relate are excess deferrals,
                  Excess Contributions, or Excess Aggregate Contributions. To
                  the extent not taken into account for purposes of the actual
                  deferral percentage test, the Plan Administrator may include
                  the following in the Contribution Percentage Amounts: (1)
                  qualified non-elective contributions, and (2) Income Deferral
                  Contributions (so long as the actual deferral percentage test
                  is met before the Income Deferral Contributions are used in
                  the actual contribution percentage test and the actual
                  deferral percentage test continues to be met following the
                  exclusion of those Income Deferral Contributions that are
                  used to meet the actual contribution percentage test).

                           (G)      For the purposes of the actual contribution
                  percentage test, "eligible participant" shall mean any
                  Employee who is eligible to make an Employee After-Tax
                  Contribution, or an Income Deferral Contribution (if the Plan
                  Administrator takes such contributions into account in the
                  calculation of the Actual Contribution Percentage), or to
                  receive an Employer Matching Contribution (including
                  forfeitures) or a qualified matching contribution. If an
                  Employee Contribution is required as a condition of
                  participation in the Plan, any Employee who would be a
                  Participant in the Plan if such Employee made such a
                  contribution shall be treated as an "eligible participant" on
                  behalf of whom no Employee Contributions are made.

                           (H)      "Employee Contribution" shall mean any
                  contribution made to the Plan by or on behalf of a
                  Participant that is included in the Participant's gross
                  income in the year in which made and that is maintained under
                  a separate account to which earnings and losses are
                  allocated,

                           (I)      To the extent not expressly provided for in
                  this Section 3.11(a) or in Section 3.11(b), the provisions
                  of Code Sections 401(m)(2) and 401(m)(9) and Treasury
                  Regulations Sections 1.401(m)-l(b) and 1.401(m)-2 (and any
                  subsequent IRS guidance issued under the above Code Sections)
                  are, to the extent applicable, incorporated by reference.

         (b)      ACP Test. The actual contribution percentage test shall be
satisfied each Plan Year. Such test shall be satisfied only if:

                  (i)      The average Actual Contribution Percentage for
         eligible participants who are Highly Compensated Employees for the
         Plan Year does not exceed the prior year's average Actual Contribution
         Percentage for eligible participants who were Non-Highly Compensated
         Employees for the prior Plan Year multiplied by 1.25; or

                  (ii)     The average Actual Contribution Percentage for
         eligible participants who are Highly Compensated Employees for the
         Plan Year does not exceed the prior year's average Actual Contribution
         Percentage for eligible participants who were Non-Highly Compensated
         Employees for the prior Plan Year multiplied by 2, provided that the
         Actual Contribution Percentage for eligible participants who are
         Highly Compensated

                                    III-14
<PAGE>
         Employees does not exceed the prior year's Actual Contribution
         Percentage for eligible participants who were Non-Highly Compensated
         Employees for the prior Plan Year by more than 2 percentage points.

For purposes of this Section 3.11(b), the average Actual Contribution
Percentage for each group shall be calculated to the nearest one-hundredth of
one percent (1/100%).

The contribution percentage test may be applied by the Plan Administrator on
the basis of any elective provision permitted under Internal Revenue Code ss.
401(m) or under any regulation, notice or other guidance issued by the U.S.
Treasury Department thereunder. The Plan may apply this Section 3.11(b) under
the current year testing method (if the Plan Administrator so elects), whereby
the contribution percentage tests in paragraphs (i) and (ii) above will be
applied by comparing the current Plan Year's Actual Contribution Percentage for
participants who are Highly Compensated Employees with the current Plan Year's
Actual Contribution Percentage for all eligible participants who are Non-Highly
Compensated Employees. The Plan Administrator elected to use the current year
testing method for its Plan Years beginning January 1, 1997, January 1, 1998,
and January 1, 1999. The Plan Administrator elected to use the prior year
testing method for its Plan Year beginning January 1, 2000. The Plan
Administrator hereby elects current year testing for its Plan Year beginning
January 1, 2001, and for each Plan Year thereafter, which election shall not be
changed except as provided in Notice 98-1 (or superseding guidance).

With respect to each plan merged into this Plan pursuant to Articles XVI, XVII
and XVIII, the current year testing method was used, prior to such merger, for
all applicable plan years.

         (c)      Multiple Use of Alternative Limitations. Sections 3.10(b)(ii)
and 3.11(b)(ii) shall not be applied to satisfy both the ACP Test and ADP Test
for the same Plan Year if multiple use occurs, unless after such occurrence,
the Plan takes the corrective measure described in Section 3.11(c)(iv).
Multiple use occurs when:

                  (i)      the average Actual Deferral Percentage for all
         Highly Compensated Employees exceeds the amount described in Section
         3.10(b)(ii); and

                  (ii)     the average Actual Contribution Percentage for all
         Highly Compensated Employees exceeds the amount described in Section
         3.11(b)(ii); and

                  (iii)    the sum of the average Actual Deferral Percentage
         and the average Actual Contribution Percentage for all Highly
         Compensated Employees exceeds the greater of the sum of (A) and (B),
         or the sum of (C) and (D), where

                           (A)      equals one hundred twenty-five percent
                  (125%) of the greater of the average Actual Deferral
                  Percentage and the average Actual Contribution Percentage for
                  all Non-Highly Compensated Employees, and

                           (B)      equals either two hundred percent (200%) of
                  the lesser of the average Actual Deferral Percentage and the
                  average Actual Contribution Percentage for all Non-Highly
                  Compensated Employees or, if less, the lesser of

                                    III-15
<PAGE>
                  the average ADP or the average ACP for all Non-Highly
                  Compensated Employees plus two (2) percentage points.

                           (C)      equals one hundred twenty-five percent
                  (125%) of the lesser of the average Actual Deferral
                  Percentage and the average Actual Contribution Percentage for
                  all Non-Highly Compensated Employees, and

                           (D)      equals either two hundred percent (200%) of
                  the greater of the average Actual Deferral Percentage and the
                  average Actual Contribution Percentage for all Non-Highly
                  Compensated Employees or, if less, the greater of the average
                  ADP or the average ACP for all Non-Highly Compensated
                  Employees plus two (2) percentage points.

                  (iv)     If multiple use occurs under this Section 3.11(c),
         then the average Actual Contribution Percentage of the Highly
         Compensated Employees shall be reduced in accordance with Section
         3.11(d) until the sum of the average Actual Deferral Percentage and
         the average Actual Contribution Percentage for all Highly Compensated
         Employees does not exceed the greater of the sum of (A) and (B) or (C)
         and (D).

         (d)      Corrective Measures if ACP Test Failed. If the Plan fails or
is projected to fail the ACP Test, then the Plan Administrator shall take one
or more of the following steps (in any order it deems advisable):

                  (i)      Limit Future Contributions. The Plan Administrator
         may limit future Employee After-Tax Contributions for some or all
         Highly Compensated Employees to the extent it deems advisable to meet
         the ACP Test.

                  (ii)     Forfeiture or Return of Excess Aggregate
         Contributions.

                           (A)      Notwithstanding any other provision of the
                  Plan, Excess Aggregate Contributions, plus any income and
                  minus any loss allocable thereto, shall be forfeited, if
                  forfeitable, or if not forfeitable, distributed no later than
                  the last day of each Plan Year to Participants to whose
                  Accounts such Excess Aggregate Contributions were allocated
                  for the preceding Plan Year. (If such Excess Aggregate
                  Contributions are distributed more than 2-l/2 months after the
                  last day of the Plan Year in which such excess amounts arose,
                  a 10-percent excise tax will be imposed on the employer
                  maintaining the Plan with respect to those amounts.) Excess
                  Aggregate Contributions are allocated to the Highly
                  Compensated Employees with the largest Contribution
                  Percentage Amounts taken into account in calculating the
                  actual contribution percentage test for the year in which the
                  excess arose, beginning with the Highly Compensated Employee
                  with the largest amount of such Contribution Percentage
                  Amounts and continuing in descending order until all the
                  Excess Aggregate Contributions have been allocated. For
                  purposes of the preceding sentence, the "largest amount" is
                  determined after distribution of any Excess Aggregate
                  Contributions. Excess Aggregate Contributions shall be
                  treated as annual additions under the Plan pursuant to this
                  "leveling method." The amount of Excess Aggregate
                  Contributions to be

                                    III-16
<PAGE>
                  distributed with respect to an Employee for a Plan Year shall
                  be reduced by any excess Employee After-Tax Contributions or
                  Special Transition Contributions previously distributed to
                  the Employee under Section 3.8(c) for the Employee's taxable
                  year ending with or within the Plan Year.

                                    (1)      If the entire account balance of a
                           Highly Compensated Employee is distributed during
                           the Plan Year in which the excess arose, the
                           distribution is deemed to have been a corrective
                           distribution to the extent that a corrective
                           distribution would have been required.

                                    (2)      If part, but not all of a Highly
                           Compensated Employee's account balance is
                           distributed during the Plan Year in which an excess
                           arose, it is not deemed to have been a corrective
                           distribution.

                           (B)      The same method used in Section 3.9(c) for
                  allocating income and loss to excess deferrals shall be used
                  to allocate income and loss to Excess Aggregate
                  Contributions.

                           (C)      The determination of the amount of Excess
                  Aggregate Contributions under Section 3.11(d) shall be
                  determined after first determining excess Deferrals under
                  Section 3.9(b) and Excess Contributions under Section
                  3.10(b).

                  (iii)    Forfeit Excess Employer Matching Contributions.
         Under the provisions of Section 3.11(d)(ii), the Plan Administrator
         may cause forfeitable Excess Aggregate Contributions made to a Highly
         Compensated Employee to be forfeited. After all other Forfeitures are
         allocated under the Plan, the Plan Administrator shall allocate such
         forfeited Excess Aggregate Contributions to other Participants (but in
         no event to any Highly Compensated Employees if such allocation would
         cause the Plan to fail the ADP Test or the ACP Test), or solely to
         Non-Highly Compensated Employees as an Employer Matching Contribution.
         Any such allocation shall be made to each such Employee who made
         Income Deferral Contributions, in the ratio which such Employee's
         Compensation for the Plan Year bears to all such Employees for the
         Plan Year. Any such forfeited amounts shall be included (i) in the
         calculation of the Actual Contribution Percentage (or, if applicable,
         the Actual Deferral Percentage), and (ii) as an Annual Addition for
         those Participants who receive such allocations.

                  (iv)     Return of Unmatched Employee After-Tax
         Contributions. The Plan Administrator may return the unmatched
         Employee After-Tax Contributions that exceed the highest rate at which
         Employee After-Tax Contributions are matched before matched Employee
         After-Tax Contributions or any Employer Matching Contributions are
         distributed or forfeited, provided they are in excess of the amount
         permitted under the ACP Test.

                  (v)      Return of Other Employee After-Tax Contributions.
         The Plan Administrator may return any other Employee After-Tax
         Contributions not returned

                                    III-17
<PAGE>
         under Section 3.11(d)(iv) provided they are in excess of the amount
         permitted under the ACP Test and it is done in a nondiscriminatory
         manner.

To the extent possible, any correction to satisfy the ACP Test (other than
limiting future contributions under Section 3.11(d)(i), shall be made within
two and one-half (2-1/2) months of the immediately following Plan Year, but in
no event later than the last day of such following Plan Year.

         3.12     Alternative Testing Methods. The Plan Administrator may, in
its discretion, perform the Average Deferral Percentage test described in
Section 3.10, the Average Contribution Percentage test described in Section 3.11
and the Multiple Use test described in Section 3.11(c), by using the statutory
alternative testing method described in Section 3.12(a) or the regulatory
alternative testing method described in Section 3.12(b). The Plan Administrator
must apply the method selected to all such tests for a particular Plan Year. In
order to use either the statutory method described in Section 3.12(a) or the
regulatory method described in Section 3.12(b), the Plan must also satisfy the
coverage requirements of Code Section 410(b) as if the Plan were comprised of
separate plans, one plan benefiting the employees who have satisfied the lower
minimum age and service conditions of the Plan but not the greatest minimum age
and service conditions permitted under Code Section 410(a) and a different plan
benefiting employees who have satisfied the greatest minimum age and service
conditions permitted under Code Section 410(a).

         (a)      Statutory. Beginning with Plan Years commencing after
December 31, 1998, the Plan may perform the Average Deferral Percentage and
Average Contribution Percentage (including Multiple Use) tests as provided in
Code Section 401 (k)(3)(F), by considering all Highly Compensated Employees who
are Eligible Employees, and all includable Eligible Employees who are not
Highly Compensated Employees.

         (b)      Regulatory. The Plan may perform the Average Deferral
Percentage and Average Contribution Percentage (including Multiple Use) tests
by performing 2 sets of tests: (i) considering all includable Eligible
Employees who are Highly Compensated Employees and all includable Eligible
Employees who are not Highly Compensated Employees; and (ii) considering all
excludable Highly Compensated Employees and all excludable Eligible Employees
who are not Highly Compensated Employees.

         (c)      Definitions and Special Rules. For the purposes of this
Section 3.12, the following definitions and special rules apply:

                  (i)      "Excludable" Employees means all Eligible Employees
         who have not met the minimum age and service requirements of Internal
         Revenue Code Section 410(a) but who have met the lower minimum age and
         service conditions of the Plan. The term "includable" Employees means
         all Eligible Employees who have met the minimum age and service
         requirements of Internal Revenue Code Section 410(a).

                  (ii)     When using prior year testing the Plan must use the
         prior year to determine whether an Employee is a Highly Compensated
         Employee and whether the Employee is includable or excludable.

                                    III-18
<PAGE>
                                   ARTICLE IV

                             PARTICIPANT ACCOUNTS

         4.1      Participant Investment Elections.

         (a)      General Rules. Each Participant shall have the right to elect
or to modify an existing election and to have his Account invested in the
various funds made available by the Plan Administrator. A Participant can elect
to modify an existing election with the Plan Administrator at such time and in
such manner as the Plan Administrator may determine. Each Participant shall
make two separate elections, one of which will apply to his Account and the
other of which will apply to subsequent contributions to his current Account
balance. An investment transfer election for a Participant's current Account
balance must be made in 1% increments. An investment election for a
Participant's subsequent contributions to his current Account balance must be
made in 1% increments, with a minimum of 5% of the Participant's subsequent
contributions being allocated to each fund selected.

         (b)      Effective Date of Elections. An election to change
investments will be effective as soon as is administratively feasible.

         (c)      Duration of Elections. An election shall remain in effect
until modified or until the Participant's Accounts no longer exist and no
further contributions are to be made by him or on his behalf.

         (d)      Other Investment Elections. Investment of that portion of the
Trust Fund and any contributions to this Plan not otherwise governed by the
provisions of this Section 4.1 shall be made by the Trustee upon the advice of
the Plan Administrator or any Investment Manager designated by the Plan
Administrator.

         4.2      Allocations. As soon as practicable after each Valuation
Date, the Employer shall perform the allocations described in this Section. The
allocations shall be taken as of each Valuation Date in the same order that the
following paragraphs appear in the Plan.

         (a)      Income Deferral Contributions, Employee After-Tax
Contributions. Employer Contributions and Rollover Contributions.

                  (i)      Income Deferral Contributions and Employee After-Tax
         Contributions. Following the receipt of the Income Deferral
         Contributions and Employee After-Tax Contributions, if any, for the
         period since the immediately preceding Valuation Date, subject to the
         limitations set forth in Article III, the Plan Administrator shall
         credit as of the current Valuation Date the Income Deferral and
         Employee After-Tax Contributions made (since the immediately
         preceding Valuation Date) for each Participant to his Income Deferral
         and Employee After-Tax Contribution Accounts or, in the event of his
         death, to the Income Deferral and Employee After-Tax Contribution
         Accounts of his Spouse or Beneficiary.

                                     IV-1
<PAGE>
                  (ii)     Employer Contributions. Subject to the limits in
         Article III, there shall be allocated as of each Valuation Date (A)
         the Matching Contributions (including any Forfeitures which became
         part of such Matching Contributions under Section 5.1(c)(v)), and (B)
         any Special Transition Contributions, made on behalf of each
         Participant since the immediately preceding Valuation Date to such
         Participant's Matching Account or Employer Contributions Account (as
         the case may be).

                  (iii)    Rollover Contributions. The Plan Administrator shall
         credit as of such Valuation Date any Rollover Contribution made (since
         the immediately preceding Valuation Date) by or on behalf of a
         Participant or other Employee to his Rollover Account as elected by
         him or, in the event of his death, to the Rollover Account of his
         Spouse or Beneficiary.

         (b)      Loans, Distributions and Withdrawals. The Plan Administrator
shall subtract from each Participant's Accounts: (1) any loan principal amount
from his Account since the immediately preceding Valuation Date so that such
loan principal amount is charged from each of his Accounts that are eligible for
loans under Section 5.6, in the order established by the written hierarchy that
the Plan Administrator shall establish; (2) any withdrawal before age 55 and not
on account of hardship since the immediately preceding Valuation Date so that
such withdrawal amount is charged against his Rollover Account, Prior Company
Match Pre-'93 Account and Employee After-Tax Account, in the order established
by the written hierarchy of withdrawals that the Plan Administrator shall
establish; (3) any withdrawal before age 59-1/2 but on or after the age of 55
and not on account of hardship since the immediately preceding Valuation Date
so that such withdrawal amount is charged against his Rollover Account,
Employee After-Tax Account, Prior Company Match Pre-'93 Account and Prior
Company Match Post-'92 Account, in the order established by the written
hierarchy of withdrawals that the Plan Administrator shall establish; (4) any
withdrawal on or after age 59-1/2 and not on account of hardship since the
immediately preceding Valuation Date so that such withdrawal amount is charged
against his Employee After-Tax Account, Rollover Account, Income Deferral
Account, Employer Matching Contribution Account, Employer Contribution
Account, Prior Plan Account, Prior Company Match Post-'92 Account, Prior
Company Match Pre-'93 Account and Prior Plan Profit Sharing Account, in the
order established by the written hierarchy of withdrawals that the Plan
Administrator shall establish; (5) any withdrawal on account of hardship since
the immediately preceding Valuation Date so that such withdrawal amount is
charged against his Rollover Account, Employee After-Tax Account, Income
Deferral Account, Employer Matching Contribution Account, Prior Company Match
Post-'92 Account, Prior Company Match Pre-'93 Account, Employer Contribution
Account and Prior Plan Profit Sharing Account, in the order established by the
written hierarchy of withdrawals that the Plan Administrator shall establish;
and (6) any distribution from his Account since the immediately preceding
Valuation Date so that his Accounts are charged with such distribution in
accordance with the written hierarchy of distributions that the Plan
Administrator shall establish. The Plan Administrator shall add any loan
principal and interest payments made to his Account since the immediately
preceding Valuation Date so that the Accounts are repaid in the order
established by the written hierarchy that the Plan Administrator shall
establish.

         (c)      Forfeitures. The Plan Administrator shall subtract from any
Participant's Account any amount forfeited. Such forfeiture shall be treated as
provided in Section 5.l(c)(v).

                                     IV-2
<PAGE>
         (d)      Adjustment. The Plan Administrator shall subtract from the
income of the fund, in a proportionate amount, the amount necessary to
reestablish any forfeiture not reestablished under Section 4.2(c). The Plan
Administrator next shall allocate the Adjustment with respect to the various
investment funds, as of such Valuation Date among the Accounts of each
Participant, Spouse or Beneficiary in the proportion that the investment of
each such Account in each such fund bears to the total investment of all such
Accounts in each such fund, so that each Account will proportionately benefit
from any earnings or appreciation in the value of the assets of each such fund
or proportionately suffer any losses or depreciation in the value of the assets
of each such fund.

         (e)      Loan Interest. The Plan Administrator shall allocate interest
income on any loan taken by the Participant to the Participant's Account in
accordance with his current Account investment election.

         (f)      Transfers. The Plan Administrator shall add to or subtract
from each Participant's Income Deferral or Prior Account any transfers to or
from his Account since the immediately preceding Valuation Date so that each
such account is credited or charged proportionately with the amount of any such
transfer.

         4.3      Valuation Report. At least once each calendar quarter, and
after completing the allocation steps described in Section 4.2, the Plan
Administrator shall deliver to the Employer a statement which shows the value
of each Account then maintained by the Trustee for a Participant, or where
appropriate, for a Spouse or Beneficiary. The Plan Administrator shall also
deliver to the Employer an Account statement for each Participant and, where
appropriate, each Spouse or Beneficiary, which may be forwarded by the Employer
to that person and which shows the contributions to the Account of a
Participant for the relevant period of the Plan Year and the then value of that
Account.

                                     IV-3
<PAGE>
                                   ARTICLE V

                         DISTRIBUTION OF PLAN BENEFITS

         5.1      Eligibility for Plan Benefits. A Participant (or where
applicable, Beneficiary or alternate payee) is eligible for Plan benefits in
the following situations:

         (a)      Disability. If a Participant suffers a Total and Permanent
Disability while he is an Employee and before he reaches his Normal Retirement
Age, his Employer Matching Contribution Account, regardless of the number of
his Years of Service, shall become nonforfeitable as of the date his active
employment as an Employee ends because of such Total and Permanent Disability
and the entire balance of his Account shall be paid in accordance with Article
V. If a former Participant who was determined by the Plan Administrator to have
a Total and Permanent Disability recovers and is reemployed by the Employer or
an Affiliate, then he immediately shall be reinstated as a new Participant, in
accordance with Section 2.1, but he shall not be permitted to repay any of his
distribution.

         (b)      Death.

                  (i)      Before Distributions Began. In the event of the
         death of a Participant before any distributions to the Participant
         began the name of such deceased Participant's Account shall be changed
         to the name of his Beneficiary as soon as practicable after the Plan
         Administrator has actual knowledge of the Participant's death. The
         Beneficiary shall be entitled to select the form of benefit payment,
         subject to Section 5.1(b)(iii). The deceased Participant's Employer
         Matching Contribution Account, regardless of the number of his Years
         of Service, shall become nonforfeitable as of his date of death.

                  (ii)     After Retirement. In the event of the death of a
         Participant after he terminates his employment but before he receives
         his total benefit, the entire vested balance of the deceased
         Participant's Account shall be paid to his Beneficiary as provided in
         Section 5.1(b)(i), except such benefit shall not be paid later than
         the date such Participant would have received his benefit, if any, due
         under Section 5.1(b)(iii).

                  (iii)    Incidental Benefit. Any death benefit paid under the
         provisions of this Section shall be incidental to the purposes of this
         Plan and shall be limited to the value of the deceased Participant's
         Account as of the date of distribution. No portion of any
         Participant's Account may be invested in life insurance, unless this
         Plan is amended to ensure that the provisions of this Section
         5.1(b)(iii) are fulfilled, in accordance with the provisions of Code
         Section 401(a)(9).

         (c)      Termination of Employment.

                  (i)      General Rule. A Participant who, as of the date of
         the termination of his employment, is ineligible for any other benefit
         payment under Sections 5.1(a) or 5.1(b) of this Plan, shall be eligible
         for the payment of the entire vested balance of his Account determined
         as of the first Valuation Date occurring on or after the date his
         employment terminates. Such amount shall be paid in accordance with
         Article V.

                                      V-1
<PAGE>
                  (ii)     Vested Percentage. Except as provided in Sections
         5.1(a), 5.1(b) and 5.1(c)(vii), the Plan Administrator shall
         determine the vested percentage of a Participant's Employer Matching
         Contribution Account in accordance with the schedule set forth below
         as of the first Valuation Date occurring on or after the date his
         employment terminates and shall so advise the Trustee. All other
         accounts that make up the Account of a Participant shall be fully
         vested and nonforfeitable at all times.

<TABLE>
<CAPTION>
                  Years of Service           Vested Percentage
                  ----------------           -----------------

                  <S>                        <C>
                  Less than 1                        0%
                  1 but less than 2                 25%
                  2 but less than 3                 50%
                  3 but less than 4                 75%
                  4 or more                        100%
</TABLE>

                  If any subsequent amendment to this Plan changes the above
         vesting schedule, then the vested percentage of each Participant's
         Account determined as of the date of adoption of such amendment, shall
         at no time be less than his vested percentage determined as of such
         date without regard to any such amendment, and any Participant with
         three (3) or more Years of Service as of the date of any such
         amendment shall be entitled to have the determination of his vested
         percentage continue under the vesting schedule in effect under the
         Plan as of the day before the amendment was effective.

                  Provided, however, for any Participant who was a participant
         in the Oak Tree Packaging Corporation Salaried/Palmer Hourly 401(k)
         Plan and for whom an account balance was transferred into this Plan
         effective April 1, 1998, the Vested Percentage shall be 100% after the
         Participant has completed three (3) or more Years of Service and the
         Vested Percentage shown immediately above in this Plan Section
         5.1(c)(ii) prior to the date that the Participant has completed three
         (3) or more Years of Service.

                  Provided, however, for any Participant who was a Participant
         in the Chesapeake Paperboard Company 401(k) Retirement Plan For the
         Salaried Employees of Chesapeake Paperboard Company and Chesapeake
         Fiber Packaging Corporation and for whom an account balance was
         transferred into this Plan effective June 30, 1998, the Vested
         Percentage shall be (i) 50% after the Participant has completed one
         (1) or more Years of Service, (ii) 75% after the Participant has
         completed two (2) or more Years of Service, and (iii) 100% after the
         Participant has completed three (3) or more Years of Service.

                  (iii)    Service Disregarded for Vesting. The following Years
         of Service shall be disregarded when determining a Participant's
         vested percentage:

                           (A)      Years of Service before the Participant
                  attained age eighteen (18); and,

                           (B)      Years of Service after a Participant has
                  incurred five (5) consecutive one-year Breaks in Service, but
                  only when calculating the Participant's vesting percentage
                  for the pre-Break period; and

                                      V-2
<PAGE>
                           (C)      Years of Service before a Participant who
                  is zero (0%) vested in Employer Contributions has incurred
                  Breaks in Service that equal or exceed the greater of (i)
                  five (5); or (ii) the aggregate number of Years of Service
                  for the Participant before such Breaks in Service.

                  (iv)     Vesting Percentage After Distribution. If a
         distribution is made at a time when a Participant has a nonforfeitable
         right to less than one-hundred (100%) of the Account balance derived
         from Employer Matching Contributions and the Participant may increase
         the nonforfeitable percentage in the Account (e.g., he has not
         incurred five (5) consecutive one-year Breaks in Service):

                           (A)      A separate account will be established for
                  the Participant's interest in the Plan as of the time of the
                  distribution, and

                           (B)      At any relevant time the Participant's
                  nonforfeitable portion of the separate account will be equal
                  to "X" determined by the formula:

                             X=P(AB + (RxD))-(RxD)

                           For the purposes of applying the formula: P is the
                  nonforfeitable percentage at the relevant time, AB is the
                  Account balance at the relevant time, D is the amount of the
                  distribution, and R is the ratio of the Account balance at
                  the relevant time to the Account balance after distribution.

                  (v)      Forfeitures. The nonvested portions of a terminated
         Participant's Employer Matching Contribution Account shall become a
         Forfeiture as of the date on which he receives a distribution.
         Forfeitures from Accounts shall first be used to restore premature
         forfeitures pursuant to Section 5.1(c)(vi) and then (at the discretion
         of the Board) may be used to pay the Plan's administrative expenses
         and/or to reduce the Employer Matching Contributions for the year in
         which the forfeiture arises.

                  (vi)     Restoration of Accounts.

                           (A)      If a Participant who incurred a Forfeiture
                  under Section 5.l(c)(v) is reemployed, begins to again
                  Participate in the Plan, and such Participant's pre-
                  separation Years of Service cannot be disregarded under
                  Section 5.1(c)(iii) then such Participant's forfeited
                  Employer Matching Contribution Account shall be restored
                  (including all optional forms of benefits) to the extent
                  forfeited upon the repayment to the Plan of the full amount
                  of the distribution. Such repayment must be made before the
                  earlier of five (5) years after the first date on which the
                  Participant is subsequently reemployed by the Employer, or
                  the date the Participant incurs five (5) consecutive Breaks
                  in Service following the date of distribution.

                           (B)      If the present value of an Employee's
                  vested Account balance is zero (0), the Employee shall be
                  deemed to have received a distribution of such vested Account
                  balance. A payment or deemed payment under this Section

                                      V-3
<PAGE>
                  5.1(c)(vi)(B) shall discharge in full any obligation to such
                  Participant and his Spouse and Beneficiary, if any, under
                  this Plan, and the nonvested portion shall be forfeited.

                           (C)      If an Employee is deemed to receive a
                  distribution pursuant to Section 5.1(c)(vi)(B) and is then
                  reemployed and resumes participation in the Plan, and such
                  Employee's pre-separation Years of Service cannot be
                  disregarded under Section 5.1(c)(iii), then upon the
                  reemployment of such Employee the Account balance will be
                  restored to the amount of such Account balance on the date of
                  the deemed distribution. Such restoration shall be unadjusted
                  by any gains or losses occurring between the date of such
                  distribution and the date of such restoration.

                           (D)      Sources of Restoration. The permissible
                  sources for such Forfeiture restorations are subsequent (1)
                  income or gain to the Plan, (2) Forfeitures as provided in
                  Section 5.1(c)(v), or (3) Employer Matching Contributions.

                  (vii)    Retirement Age Vesting. The Employer Matching
         Contribution Account of a Participant who is an Employee on the date
         he reaches his Normal Retirement Age, regardless of the number of his
         Years of Service, shall become nonforfeitable not later than such date
         and, if such Participant retires on or after such date, his entire
         Account shall be paid in accordance with Article V.

         (d)      In-Service Withdrawals. Participants who meet the conditions
of Sections 5.4 or 5.5 may receive an in-service withdrawal.

         5.2      Distribution Rules and Methods.

         (a)      Vested Account Balances of $5,000 or Less. Notwithstanding
any other provisions of this Article, upon any termination of a Participant's
employment with the Employer, in the event the value of his nonforfeitable
Account is $5,000 or less, such Participant's Account shall be paid to him in
cash in a lump sum not later than ninety (90) days after the Plan Year in which
he separates from service. Notwithstanding the above, however, if a
Participant's Account contains qualifying employer securities, then the
Participant may elect a distribution in kind of any qualifying employer
securities in his Account. If, however, an election to receive a distribution
in kind is not made within 30 days of the Participant being notified of his
right to make this election, the Participant will lose such right and the
amount will be cashed out. In the case of a Participant whose vested percentage
in his Employer Matching Contribution Account is less than one hundred (100%)
percent, the non-vested portion if any, of such Employer Matching Contribution
Account shall be treated as a Forfeiture under Section 5.1(c)(v) as of the last
day of the Plan Year in which such distribution is made as a result of such
termination of employment.

         (b)      Vested Account Balances over $5,000. Distributions under this
Article V of the balance of a Participant's Account shall be paid to him or, in
the case of his death, to his Beneficiary, if any, by the Trustee in a single
lump sum of cash or in substantially equal

                                      V-4
<PAGE>
monthly, quarterly or annual installments for a stated period (not to exceed
ten years) as elected by the Participant. Notwithstanding the above, however,
if a Participant's Account contains qualifying employer securities, then a
Participant who elects a single lump sum payment may also elect a distribution
in kind of any qualifying employer securities in his Account.

                  (i)      If the value of a Participant's nonforfeitable
         Account is more than $5,000, a distribution of such Participant's
         Account may not be made without his consent (except minimum required
         distributions under Section 5.2(c)). Within the period beginning 90
         days before the annuity starting date and ending 30 days before the
         annuity starting date, the Plan must provide each Participant to whom
         the consent requirement of this Section 5.2(b)(i) applies a written
         notice explaining the material features of, and explaining the
         relative values of, the optional forms of benefit available under the
         Plan (in a manner that would satisfy the requirements of Internal
         Revenue Code ss. 417(a)(3)), including an explanation of the right to
         defer distribution of benefits by refusing to consent to a
         distribution. However, notwithstanding this notice requirement, a
         distribution may commence less than 30 days after the notice provided
         that (1) the Plan clearly informs the Participant that the Participant
         has a right to a period of at least 30 days after receiving the notice
         to consider the decision of whether or not to elect a distribution
         (and, if applicable, a particular distribution option), and (2) the
         Participant, after receiving the notice, affirmatively elects a
         distribution. The Participant's written consent must not be made
         before the Participant receives the written notice and must not be
         made more than 90 days before the annuity starting date. The "annuity
         starting date" is the first day of the first period for which an
         amount is paid as an annuity or any other form.

                  (ii)     If the Participant dies before all of the
         installments have been paid to him, the remaining number of payments
         (reduced by any security interest held by the Plan by reason of a loan
         outstanding to such Participant) shall be made in full to his
         Beneficiary. A Participant may not change his benefit form election
         after benefit payments begin.

         (c)      Required Minimum Distributions.

                  (i)      General Rule. A Participant remains eligible to
         continue to participate in this Plan until the date his employment
         terminates, his death or his Total and Permanent Disability, but his
         Account shall begin to be paid not later than the Required
         Commencement Date.

                  (ii)     Reserved.

                  (iii)    Distributions Beginning after Death. If the
         Participant dies before distribution of his Account begins, then
         distribution of his entire Account shall be completed by December 31
         of the calendar year containing the fifth anniversary of the
         Participant's death except to the extent that an election is made to
         receive distributions in accordance with paragraphs (A) or (B), below.

                           (A)      If any portion of the Participant's Account
                  is payable to a designated beneficiary, distributions may be
                  made over the lesser of ten years or a period certain not
                  greater than the life expectancy of the designated
                  beneficiary

                                      V-5
<PAGE>
                  commencing on or before December 31 of the calendar year
                  immediately following the calendar year of the Participant's
                  death;

                           (B)      If the designated beneficiary is the
                  Participant's Surviving Spouse, the date distributions are
                  required to begin in accordance with (A) above shall not be
                  earlier than the later of: (i) December 31 of the calendar
                  year immediately following the calendar year in which the
                  Participant dies, and (ii) December 31 of the calendar year
                  in which the Participant would have attained age 70-1/2.

                           (C)      If the Participant has not made an election
                  pursuant to this Section 5.2(c)(iii) by the time of his
                  death, the Participant's designated beneficiary must elect
                  the method of distribution no later than the earlier of (i)
                  December 31 of the calendar year in which distributions would
                  be required to begin under this Section 5.2(c)(iii), or (ii)
                  December 31 of the calendar year which contains the fifth
                  anniversary of the date of death of the Participant. If the
                  Participant has no designated beneficiary, or if the
                  designated beneficiary does not elect a method of
                  distribution, distribution of the Participant's entire
                  Account must be completed by December 31 of the calendar year
                  containing the fifth anniversary of the Participant's death.

                  (iv)     For purposes of Section 5.2(c)(iii), if the
         surviving Spouse dies after the Participant, but before payments to
         such Spouse begin, the provisions of Section 5.2(c)(iii), with the
         exception of paragraph (B), shall be applied as if the surviving
         Spouse were the Participant.

                  (v)      Reserved.

                  (vi)     Use of Proposed Section 401(a)(9) Regulations for
         2001. With respect to distributions under the Plan made in calendar
         years beginning on or after January 1, 2001, the Plan will apply the
         minimum distribution requirements of Code Section 401(a)(9) in
         accordance with the regulations under Section 401(a)(9) that were
         proposed in January 2001, notwithstanding any provision of the Plan to
         the contrary. The provisions of this Section 5.2(c)(vi) shall continue
         in effect until the end of the last calendar year beginning before the
         effective date of final regulations under Section 401(a)(9) or such
         other date specified in guidance published by the Internal Revenue
         Service or otherwise set forth in Section 5.2(c)(vii).

                  (vii)    Use of Final and Temporary Section 401(a)(9)
         Regulations for 2002. This Section 5.2(c)(vii) applies for purposes of
         determining required minimum distributions for calendar years beginning
         with the 2003 calendar year, as well as required minimum distributions
         for the 2002 distribution calendar year that are made on or after
         October 1, 2002. The Plan will apply the minimum distribution
         requirements of Code Section 401(a)(9) in accordance with the final and
         temporary regulations under Section 401(a)(9) that were published in
         the Federal Register on April 17, 2002, notwithstanding any provision
         of the Plan to the contrary.

         (d)      Timing of Distributions. Subject to the required minimum
distribution rules in Section 5.2(c), and unless the Participant elects
otherwise, distributions will be made or begin to be made not later than ninety
(90) days from the end of the Plan Year in which the Participant separates from
service, but not later than sixty (60) days after the end of the Plan Year in
which the later of his attaining age sixty-five (65) or his actual retirement
occurs; provided, however, any distribution under this Plan shall be made as
soon as administratively feasible after the applicable Valuation Date or other
payment date; provided further, however, if the value of such distribution
cannot be reasonably ascertained on a timely basis, such distribution may also
be delayed beyond the dates provided in this Section 5.2(d) until such value is
determined.

                                      V-6
<PAGE>
         (e) Maximum Length of Installments. Subject to Section 5.2(c) the
length of any installment payments may not exceed the greater of a
Participant's life expectancy or that of the Participant and his designated
beneficiary, if any (or ten years, if less), as of the date benefit payments
are to begin.

         (f) Distribution to Alternate Payee Pursuant to a Qualified Domestic
Relations Order. If a Qualified Domestic Relations Order provides for the
payment of the alternate payee's entire interest in the Plan in a single sum
cash payment, then such order may provide for such payment to be made within
120 days after the issuance of the order, notwithstanding that the Participant
could not himself receive a distribution from the Plan at such time.

         5.3      Reserved.

         5.4      In-Service Withdrawals.

         (a)      In General. A Participant can make an in-service withdrawal
of all or a portion of his:

                  (i)      Employee After-Tax Accounts, Rollover Accounts,
         Prior Company Match Pre-'93 Accounts and After-Tax Rollover Accounts.

                  (ii) Income Deferral Contributions Accounts, Prior Plan Profit
         Sharing Accounts, Employee Pre-Tax Catch-Up Contribution Accounts, and
         the vested portion of his Employer Matching Contribution Account on or
         after attaining age 59-1/2 or incurring a hardship (and, in the case of
         hardship, satisfying the hardship withdrawal requirements in Section
         5.5).

                  (iii) Prior Company Match Post-'92 Accounts on or after
         attaining age 55 or incurring a hardship (and, in the case of
         hardship, satisfying the hardship withdrawal requirements in Section
         5.5).

                  (iv)     Prior Plan Accounts, Employer Contribution Accounts
         and Prior Plan Qualified Matching Contribution Account on or after
         attaining age 59-l/2.

         (b) Limit on Amount of Withdrawal. The maximum amount a Participant
may withdraw is reduced by (i) any prior withdrawals that have not been taken
into account as of the date such withdrawal is requested; and (ii) the amount
of such Account being used as collateral for a loan. The amount of an
in-service withdrawal may not be less than $500 or the balance in the
Participant's Account which may be withdrawn, if less. A Participant can
receive only one in-service withdrawal under this Section in a six-month
period.

         (c) Withdrawal from Employee After-Tax Contributions Account.
After-Tax Contributions made prior to January 1, 1987 may be withdrawn with or
without earnings, at the Participant's election. Each withdrawal of Employee
After-Tax Contributions made after December 31, 1986 shall be accompanied by a
proportionate withdrawal of any earnings attributable to such contributions.

         (d)      Procedure for Requesting a Withdrawal. A Participant who
wishes to make an in-service withdrawal shall make a request to the Plan
Administrator at such time and in such

                                      V-7
<PAGE>

way as the Plan Administrator determines. A request for a withdrawal may not
take effect on a date occurring less than six (6) full months after the
effective date of any such election that such Participant had made previously.

         (e) Time of Distribution of Withdrawal. Upon direction of the Plan
Administrator, the Trustee shall pay the amount withdrawn as soon as
practicable, but in any event within sixty (60) days, following the date for
which such withdrawal is approved.

         5.5      Hardship Withdrawal Requirements.

         (a) In General. If a Participant incurs an immediate and heavy
financial need, and a distribution from this Plan is necessary to satisfy such
need, such Participant may withdraw all or a portion of the amount necessary to
satisfy the financial need from the Accounts available for hardship withdrawals
under Section 5.4(a).

         (b)      Immediate and Heavy Financial Need. An immediate and heavy
financial need exists where the withdrawal is requested for:

                  (i) expenses for medical care, as described in Code Section
         213(d), incurred by the Participant, his spouse or any of his
         dependents, as defined in Code Section 152, or necessary for these
         persons to obtain medical care described in Code Section 213(d);

                  (ii) costs directly related to the purchase of a principal
         residence for the Participant (other than to make mortgage payments,
         except as provided under Section 5.5(b)(iv));

                  (iii) payment of tuition and related educational fees for the
         next 12 months of post-secondary education for the Participant, his
         spouse, children or other dependents, as defined in Code Section 152;

                  (iv)     payments necessary to prevent the eviction of the
         Participant from his principal residence or foreclosure on the
         mortgage on such residence; or

                  (v) any other such needs identified by the Commissioner of
         the Internal Revenue Service and announced in a publication generally
         applicable to all taxpayers.

         (c) Distribution Necessary to Satisfy Need. The Participant must
establish that the distribution is necessary to satisfy his need by satisfying
Section 5.5(d), or by establishing that it does not exceed the amount of the
need (including amounts necessary to pay federal, state or local income taxes
or penalties reasonably anticipated to result from the distributions), and that
it cannot be satisfied from other resources (including assets of the
Participant's spouse and children that are reasonably available to the
Participant).

         (d) Distribution Deemed Necessary to Satisfy Need. In determining
whether a financial hardship exists, the Plan Administrator shall deem that the
distribution is necessary to satisfy an immediate and heavy financial need
where:

                  (i)      the amount of the withdrawal is within the limits of
         Section 5.5(e);

                                      V-8
<PAGE>

                  (ii) the Participant has obtained all other distributions,
         withdrawals and nontaxable loans currently available to him under the
         Plan and all other plans maintained by the Employer and any other
         Affiliate;

                  (iii) the Plan and all other plans maintained by the Employer
         and any other Affiliate limit the Participant's Income Deferral
         Contributions (or analogous contributions) for the next taxable year
         to the alternative limit (as defined in Section 3.9(a)) for that year
         minus the Participant's Income Deferral Contributions for the year of
         the hardship distribution; and

                  (iv) the Participant is prohibited (under the terms of the
         plan or a legally enforceable agreement) from making Income Deferral
         (or analogous) Contributions and employee contributions to the Plan
         and all other plans of the Employer (including qualified and
         nonqualified plans, but excluding health and welfare plans) for at
         least 12 months after receipt of the hardship distribution.

A distribution shall also be deemed to satisfy an immediate and heavy financial
need in any other situations demonstrating a lack of any other reasonably
available resources identified by the Commissioner of the Internal Revenue
Service and announced in a publication generally applicable to all taxpayers.

         (e)      Limit on Amount of Hardship Withdrawal. The amount of a
hardship withdrawal is limited by the provisions of Section 5.4(b).
Furthermore, a withdrawal distribution cannot exceed the lesser of:

                  (i) the amount required to meet the immediate and heavy
         financial need created by the hardship (including amounts necessary to
         pay federal, state or local income taxes or penalties reasonably
         anticipated to result from the distributions); or

                  (ii) the fair market value of the assets in the Participant's
         Accounts that are eligible for hardship withdrawals (under Section
         5.4(a)) as of the withdrawal date.

         A hardship withdrawal from a Participant's Income Deferral
         Contribution Account may not exceed the greater of (A) an amount equal
         to the value of the Participant's Income Deferral Contribution Account
         as of December 31, 1988, reduced by any prior hardship withdrawals, or
         (B) an amount equal to the value of the Participant's Income Deferral
         Contribution Account as of December 31, 1988, plus any subsequent
         Income Deferral Contributions (unadjusted for earnings), reduced by
         any prior hardship withdrawals.

         5.6 Loans to Participants. Effective as of June 1, 1994, under a loan
program administered by the Plan Administrator, loans may be made to
Participants and Beneficiaries from their Income Deferral Contributions
Account, Employee After-Tax Account, Employer Matching Contribution Account,
Rollover Account, Prior Plan Account, Prior Company Match Pre-'93 Account,
Prior Company Match Post-'92 Account and Prior Plan Profit Sharing Account
under the provisions of this Section 5.6. Such loans (i) shall be made pursuant
to uniform rules adopted by the Plan Administrator and the rules of this
Section 5.6, (ii) shall be available to all Participants and Beneficiaries on a
reasonably equivalent basis, and (iii) shall not be available to Highly
Compensated Employees in an amount greater than the amount made available to
other

                                      V-9
<PAGE>
Participants and Beneficiaries. The Plan Administrator is authorized to adopt,
and may from time to time amend, loan rules. Such loan rules shall be set forth
in a written document or documents, and may not be inconsistent with the
provisions of this Section 5.6. The loan rules must (1) identify the person or
positions authorized to administer the loan program, (2) establish a procedure
for applying for loans, (3) set forth the basis on which loans will be approved
or denied, (4) set forth the limitations (if any) on the types and amounts of
loans offered, (5) establish the procedure for determining a reasonable rate of
interest, (6) identify the types of collateral which may secure a loan, and (7)
identify the events constituting default and the steps that will be taken to
preserve Plan assets in the event of such default. The loan rules may include
other provisions.

         5.7 Sale or Other Disposition by the Employer. A Participant is also
entitled to receive a distribution upon the sale or other disposition by the
Employer of (i) substantially all the assets used by the Employer in its trade
or business to an unrelated corporation (as provided in Income Tax Regulation
Section 1.401(k)-l(d)(l)(iv)), or (ii) its interest in a subsidiary to an
unrelated entity or other individual (as provided in Income Tax Regulation
Section 1.401(k)-l(d)(l)(v)).

         5.8      Direct Rollover.

         (a) General Rules. This Section applies to distributions made on or
after January 1, 1993. Notwithstanding any provision of the Plan to the
contrary that would otherwise limit a distributee's election under this
Section, a distributee may elect, at the time and in the manner prescribed by
the Plan Administrator, to have any portion of an eligible rollover
distribution paid directly to an eligible retirement plan specified by the
distributee in a direct rollover.

         (b)      Definitions.

                  (i) Eligible Rollover Distribution. An eligible rollover
         distribution is any distribution of all or any portion of the balance
         to the credit of the distributee, except that an eligible rollover
         distribution does not include any distribution that is one of a series
         of substantially equal periodic payments (not less frequently than
         annually) made for the life (or life expectancy) of the distributee or
         the joint lives (or joint life expectancies) of the distributee and
         the distributee's designated beneficiary, or for a specified period
         of ten years or more; any distribution to the extent such distribution
         is required under Section 40l(a)(9) of the Code; any distribution
         from Income Deferral Contributions Accounts made under Section 5.5
         (hardship distributions) and the portion of any distribution that is
         not includable in gross income (determined without regard to the
         exclusion for net unrealized appreciation with respect to employer
         securities).

                  (ii) Eligible Retirement Plan. An eligible retirement plan is
         an individual retirement account described in Section 408(a) of the
         Code, an individual retirement annuity described in Section 408(b) of
         the Code, an annuity plan described in Section 403(a) of the Code, or
         a qualified trust described in Section 401(a) of the Code, that
         accepts the distributee's eligible rollover distribution. However, in
         the case of an eligible rollover distribution to the surviving Spouse,
         an eligible retirement plan is an individual retirement account or
         individual retirement annuity.

                                     V-10
<PAGE>
                  (iii) Distributee. A distributee includes an Employee or
         former Employee. In addition, the Employee's or former Employee's
         surviving Spouse and the Employee's or former Employee's Spouse or
         former Spouse who is the alternate payee under a qualified domestic
         relations order, as defined in Section 414(p) of the Code, are
         distributees with regard to the interest of the Spouse or former
         Spouse.

                  (iv)     Direct Rollover. A direct rollover is a payment by
         the Plan to the eligible retirement plan specified by the distributee.

         5.9 Spendthrift Clause. Except as otherwise provided by law, no
benefit, payment or distribution under this Plan shall be subject either to the
claim of any creditor of a Participant, Spouse or Beneficiary or to attachment,
garnishment, levy, execution or other legal or equitable process by any
creditor of such person, and no such person shall have any right to alienate,
commute, anticipate or assign (either at law or equity) all or any portion of
any benefit payment or distribution under this Plan. This Section also shall
apply to any domestic relations order, unless such order is a "qualified
domestic relations order" as defined in Code Section 414(p). Notwithstanding
the provisions of the first sentence of this Section 5.9, a Participant's
benefits provided under the Plan may be offset against any amount that the
Participant is ordered or required to pay to the Plan if (i) the order or
requirement to pay arises (A) under a judgment of conviction for a crime
involving the Plan, (B) under a civil judgment (including a consent order or
decree) entered by a court in an action brought in connection with a violation
(or alleged violation) of part 4 of subtitle B of title I of ERIS A, or (C)
pursuant to a settlement agreement between the Secretary of Labor and the
Participant in connection with a violation (or alleged violation) of part 4 of
such subtitle by a fiduciary or any other person, and (ii) the judgment, order,
decree, or settlement agreement expressly provides for the offset of all or
part of the amount ordered or required to be paid to the Plan against the
Participant's benefits provided under the Plan.

         5.10 Benefit Supported Only by Trust Fund. Any person who claims any
benefit under this Plan shall look solely to the assets of the Trust Fund for
satisfaction. In no event will the Trustee, the Company, any other Employer or
any employee of the Company or any other Employer be liable in their individual
capacities to any person for the payment of benefits under this Plan.

         5.11 Legally Incompetent. The Plan Administrator may direct, in its
sole discretion, and the Trustee shall make payment on such direction, that
payments of benefits under this Plan be made directly either (a) to a person
who is incompetent or disabled (whether because of minority or mental or
physical disability), (b) to the guardian of such person or (c) to the person
having legal custody of such person, without further liability either on the
part of the Employer, the Plan Administrator or the Trustee for the amount of
such payment to the person on whose behalf such payment is made.

         5.12 Missing Participant. Effective June 1, 1994, if a Participant
cannot be contacted at his last known address or otherwise located through the
reasonable efforts of the Plan Administrator by the end of the two-year period
beginning on the date he terminates employment with the Employer, his Account,
upon Plan Administrator direction, may be treated as a forfeiture and
reallocated as of the last day of the Plan Year which includes the end of such

                                     V-11
<PAGE>
two-year period. However, if such Participant or, if he is deceased, his
surviving Beneficiary, should subsequently be located, on the first Valuation
Date after the date he or such Beneficiary is located, the Plan Administrator
shall reestablish the Account of the Participant in an amount equal to the
dollar amount forfeited under this Section, and such Account shall be paid to
the Participant or surviving Beneficiary in accordance with the Plan
Administrator's direction as of the Valuation Date on which the Account is
reestablished. The permissible sources for such reestablishment are subsequent
(i) income or gain to the Plan, or (ii) forfeitures. If a missing Participant
has not been located by the date this Plan is terminated, then such
Participant's Account shall forever be forfeited, and he shall have no right to
reinstatement.

                                     V-12
<PAGE>
                                   ARTICLE VI

                              PLAN ADMINISTRATION

         6.1 Plan Administrator. The Company shall be the Plan Administrator
for purposes of ERISA and for purposes of satisfying any requirement imposed
now or in the future through federal or state legislation to report and
disclose to any federal or state department or agency, or to any Participant,
Spouse or Beneficiary, any information respecting the establishment or
maintenance of this Plan. The Company's responsibilities as Plan Administrator,
under the Plan and under law, shall be carried out by or under the supervision
of an Administrative Committee appointed by and serving at the pleasure of
Caraustar Industries, Inc.'s Board of Directors. The Administrative Committee's
actions shall be actions on behalf of the Plan Administrator and not on behalf
of itself or of its individual members.

         6.2 Appointment. The Company shall appoint an "Administrative
Committee" which shall be a committee of three (3) or more persons to perform
the duties of Caraustar Industries, Inc. as Plan Administrator. All references
to Plan Administrator in this Plan also include "Administrative Committee." Any
individual, including but not limited to Employees and Participants, may be
appointed to the Committee.

         6.3 Term and Compensation. A member of the Administrative Committee as
appointed in Section 6.2 shall serve until his resignation or dismissal by the
Company. Vacancies shall be filled in the same manner as the original
appointments. To resign, the Administrative Committee member shall give written
notice which shall be effective on the earlier of the appointment of his
successor or the passing of thirty (30) days after such notice is mailed or
personally delivered to the Company. Members of the Administrative Committee
shall serve as such without compensation.

         (a) Any Committee member may resign and the Company may remove any
Committee member, with or without cause, at any time. To the maximum extent
permitted by ERISA, every action and determination of the Committee in
accordance with this Section shall be final and binding upon each Participant
and upon every other person entitled to or claiming participation in the Plan
or benefits from the Plan. No member of the Committee acting as such shall be
entitled to act on or decide any matter relating solely to the member or to any
of the member's rights or benefits under the Plan.

         (b) The Committee shall appoint a member of the Committee as Chairman.
In addition to any specific duties and responsibilities given to the Chairman
under the terms of the Plan, the Committee may from time to time allocate or
delegate to the Chairman (or to any subcommittee or members of the Committee,
or others) such duties relative to the administration and interpretation of the
Plan as it deems necessary or appropriate, including matters involving the
exercise of discretion. The Chairman may from time to time delegate to others
such of his duties as he deems necessary or appropriate. The Committee may
remove at any time, with or without cause, the Chairman and any person to whom
duties are delegated by the Committee or the Chairman.

                                     VI-1
<PAGE>
         6.4 Claims Procedure. The Plan Administrator shall interpret this Plan
and shall make all determinations with regard to the administration and
application of this Plan. All such determinations shall be final, conclusive
and binding except to the extent that they are appealed with regard to benefit
claims under the following procedure.

         (a) A Participant or Beneficiary (including a survivor, contingent
annuitant or other Beneficiary) (a "claimant") with an interest in the Plan
shall have the right to file a claim for benefits under the Plan and to appeal
any denial of a claim for benefits. Any request for a Plan benefit or to clarify
the claimant's rights to future benefits under the terms of the Plan shall be
considered to be a claim when filed with the Plan Administrator in accordance
with paragraph (b) below. An authorized representative of the claimant may act
on behalf of the claimant in pursuing a benefit claim or appeal of an adverse
benefit determination. The individual or individuals responsible for deciding
the benefit claim or appeal, as applicable, may require the representative to
provide reasonable written proof that the representative has in fact been
authorized to act on behalf of the claimant. The Plan requires no fee or other
cost for the making of a claim or appealing an adverse benefit determination.

         (b) A claim for benefits will be considered as having been made when
submitted in writing by the claimant to the Plan Administrator. A claim must be
submitted in writing on such form or forms as may be required by the Plan
Administrator. The claim may be delivered personally during normal business
hours or mailed to the Plan Administrator.

         (c) The Plan Administrator, acting through such agent or agents as it
may appoint, will determine whether, or to what extent, the claim may be
allowed or denied under the terms of the Plan. In the case of a claim for
disability benefits, such agent or agents must be someone other than an
Administrative Committee member and may not be any person to whom an
Administrative Committee member is subordinate. If the claim is wholly or
partially denied, the Plan Administrator shall notify the claimant of the
Plan's adverse benefit determination within a reasonable period of time, but
not later than 90 days (not later than 45 days in the case of a claim for
disability benefits) after the Plan receives the claim, unless the Plan
Administrator determines that special circumstances require an extension of
time for processing the claim.

                  Extensions for claims other than a claim for disability
                  benefits. If such an extension of time for processing is
                  required, written notice of the extension shall be furnished
                  to the claimant prior to the termination of the initial
                  90-day period. Such extension may not exceed an additional 90
                  days from the end of the initial 90-day period. The extension
                  notice shall indicate the special circumstances requiring an
                  extension of time and the date by which the Plan expects to
                  render the final decision.

                  Extensions for claims for disability benefits. The 45-day
                  period may be extended by the Plan for up to 30 days,
                  provided that the Plan Administrator both determines that
                  such an extension is necessary due to matters beyond the
                  control of the Plan and notifies the claimant, prior to the
                  expiration of the initial 45-day period, of the circumstances
                  requiring the extension of time and the date by which the
                  Plan expects to render a final decision. If, prior to the end
                  of the first 30-day

                                     VI-2
<PAGE>
                  extension period, the Plan Administrator determines that, due
                  to matters beyond the control of the Plan, a decision cannot
                  be reached within the extension period, the period for making
                  the determination may be extended for up to an additional 30
                  days, provided that the Plan Administrator notifies the
                  claimant prior to the expiration of the first 30-day
                  extension period, of the circumstances requiring an extension
                  and the date as of which the Plan expects to render a
                  decision. The notice of any extension shall specifically
                  explain the standards on which entitlement to a benefit is
                  based, the unresolved issues that present a decision on the
                  claim, and the additional information needed to resolve those
                  issues. The claimant shall be afforded at least 45 days
                  within which to provide the specified information.

                  Calculating time periods. For the purposes of this paragraph
                  (c), the period of time within which a benefit determination
                  is required to be made shall begin at the time a claim is
                  filed in accordance with the Plan's filing requirements,
                  without regard to whether all the information necessary to
                  make a benefit determination accompanies the filing. In the
                  event that a period of time is extended as provided above for
                  the determination of a claim for disability benefits due to a
                  claimant's failure to submit information necessary to decide
                  a claim, the period for making the benefit determination
                  shall be tolled from the date on which the notification of
                  the extension is sent to the claimant until the date on which
                  the claimant responds to the request for additional
                  information.

         (d) The Plan Administrator shall provide a claimant with written or
electronic notification of any adverse benefit determination. Any electronic
notification shall comply with the standards imposed by United States
Department of Labor Regulation Section 2520.104b-l(c)(i), (iii) and (iv). The
notification shall set forth, in a manner calculated to be understood by the
claimant:

                  (i)   The specific reason(s) for the adverse
         determination;

                  (ii)  Reference to the specific Plan provisions on which
         the determination is based;

                  (iii) A description of any additional material or information
         necessary for the claimant to perfect the claim and an explanation of
         why such material or information is necessary;

                  (iv) A description of the Plan's appeal (review) procedures
         and the time limits applicable to such procedures, including a
         statement of the claimant's right to bring a civil action under
         Section 502(a) of ERISA following an adverse benefit determination on
         appeal; and

                  (v) In the case of an adverse benefit determination regarding
         a claim for disability benefits, if an internal rule, guideline,
         protocol, or other similar criterion was relied upon in making the
         adverse determination, the specific rule, guideline, protocol or other
         criterion, or, if the adverse determination is based on a medical
         necessity or

                                     VI-3
<PAGE>
         experimental treatment or similar exclusion, an explanation of the
         scientific or clinical judgment for the determination, applying the
         terms of the Plan to the claimant's medical circumstances.

         (e) The claimant may appeal an adverse benefit determination to the
Administrative Committee. The Administrative Committee shall conduct a full and
fair review of each appealed claim and its denial. The claimant shall have at
least 60 days (at least 180 days if the appeal involves a claim for disability
benefits) following receipt of a notification of an adverse benefit
determination within which to appeal the determination.

         (f) The appeal of an adverse benefit determination must be made in
writing and filed with the Plan Administrator. In connection with making such
request, the claimant may submit written comments, documents, records, and
other information relating to the claim for benefits. The claimant shall be
provided, free of charge upon written request, reasonable access to, and copies
of, all documents, records and other information relevant (as defined in
paragraph (k) below) to the claimant's claim for benefits. In considering the
appeal the Administrative Committee shall take into account all comments,
documents, records, and other information submitted by the claimant relating to
the claim, without regard to whether such information was submitted or
considered in connection with the initial benefit determination. If the appeal
involves a claim for disability benefits, then (i) the Administrative Committee
shall not afford deference to the Plan Administrator's initial adverse benefit
determination and (ii) in deciding an appeal of any adverse benefit
determination that is based in whole or in part on a medical judgment,
including determinations with regard to whether a particular treatment, drug,
or other item is experimental, investigational, or not medically necessary or
appropriate, the Administrative Committee shall consult with a health care
professional who has appropriate training and experience in the field of
medicine involved in the medical judgment; provided, that such health care
professional must be an individual who is neither an individual who was
consulted in connection with the adverse benefit determination that is the
subject of the appeal, nor the subordinate of any such individual,

                  General procedure. The Plan Administrator shall notify a
                  claimant of the Plan's benefit determination upon appeal
                  within a reasonable period of time, but not later than 60 days
                  (not later than 45 days in the case of a claim for disability
                  benefits) after receipt of the claimant's appeal. However, the
                  Plan Administrator may determine that special circumstances
                  (such as the need to hold a hearing) require an extension of
                  time for processing the claim. If the Plan Administrator
                  determines that an extension of time, not to exceed 60 days
                  (not to exceed 45 days in the case of a claim for disability
                  benefits), for processing is required, written notice of the
                  extension shall be furnished to the claimant prior to the
                  termination of the initial 60-day (or 45-day) period. The
                  extension notice shall indicated the special circumstances
                  requiring an extension of time and the date by which the Plan
                  expects to render the determination on appeal.

                                     VI-4
<PAGE>
                  Special procedure if Administrative Committee holds regularly
                  scheduled meetings. However, if the Administrative Committee
                  holds regularly scheduled meetings at least quarterly, a
                  decision on the benefit determination on appeal shall be made
                  by no later than the date of the meeting that immediately
                  follows the Plan's receipt of a request for review, unless
                  the request is filed within 30 days preceding the date of
                  such meeting. In such case, a benefit determination may be
                  made by no later than the date of the second meeting
                  following the Plan's receipt of the appeal. If special
                  circumstances (such as the need to hold a hearing) require a
                  further extension of time for processing, the benefit
                  determination shall be rendered not later than the third
                  meeting following the Plan's receipt of the appeal. If such
                  an extension of time is required because of special
                  circumstances, the Plan Administrator shall provide the
                  claimant with written notice of the extension, describing the
                  special circumstances and the date as of which the benefit
                  determination will be made, prior to the commencement of the
                  extension. The Plan Administrator shall notify the claimant
                  of the benefit determination as soon as possible but not
                  later that five days after the benefit determination is made.

                  Calculating time periods. For the purposes of this paragraph
                  (f), the period of time within which a benefit determination
                  on appeal is required to be made shall begin at the time an
                  appeal is filed in accordance with the Plan's appeal filing
                  requirements, without regard to whether all the information
                  necessary to make a benefit determination on appeal
                  accompanies the filing. In the event that a period of time is
                  extended as provided above for the determination of a claim
                  on appeal due to a claimant's failure to submit information
                  necessary to decide an appeal of an adverse benefit
                  determination, the period for making the benefit
                  determination on appeal shall be tolled from the date on
                  which the notification of the extension is sent to the
                  claimant until the date on which the claimant responds to the
                  request for additional information.

                  Furnishing documents. In the case of an adverse determination
                  on appeal, the Plan Administrator shall provide such access
                  to, and copies of, documents, records, and other information
                  described in subparagraphs (g)(iii), (iv) and (v) below as is
                  appropriate.

         (g) The Plan Administrator shall provide a claimant with written or
electronic notification of the Plan's benefit determination on appeal. Any
electronic notification shall comply with the standards imposed by United
States Department of Labor Regulation Section 2520.104b-l(c)(i), (iii) and
(iv). In the case of an adverse benefit determination on appeal, the
notification shall set forth, in a manner calculated to be understood by the
claimant:

                  (i)      The specific reason(s) for the adverse
         determination;

                  (ii)     Reference to the specific Plan provisions on which
         the benefit determination is based;

                                     VI-5
<PAGE>
                  (iii) A statement that the claimant is entitled to receive,
         upon request and free of charge, reasonable access to, and copies of,
         all documents, records, and other information relevant (as defined in
         paragraph (k) below) to the claimant's claim for benefits;

                  (iv)     A statement of the claimant's right to bring a civil
         action under Section 502(a) of ERISA;

                  (v) In the case of an adverse benefit determination regarding
         a claim for disability benefits, if an internal rule, guideline,
         protocol, or other similar criterion was relied upon in making the
         adverse determination, the specific rule, guideline, protocol or other
         criterion, or, if the adverse determination is based on a medical
         necessity or experimental treatment or similar exclusion, an
         explanation of the scientific or clinical judgment for the
         determination, applying the terms of the Plan to the claimant's
         medical circumstances; and

                  (vi) In the case of an adverse benefit determination
         regarding a claim for disability benefits, the following statement:
         "You and your Plan may have other voluntary alternative dispute
         resolution options, such as mediation. One way to find out what may be
         available is to contact your local U.S. Department of Labor Office and
         your State insurance regulatory agency."

         (h) A claimant must exhaust his rights to file a claim and to appeal
an adverse benefit determination before bringing any civil action to recover
benefits due to him under the terms of the Plan, to enforce his rights under
the terms of the Plan, or to clarify his rights to future benefits under the
terms of the Plan.

         (i) The Plan Administrator and Administrative Committee shall exercise
their responsibilities and authority under this claims procedure as fiduciaries
and, in such capacity, shall have the discretionary authority and
responsibility (1) to interpret and construe the Plan and any rules or
regulations under the Plan, (2) to determine the eligibility of employees to
participate in the Plan, and the rights of Participants, former Participants,
beneficiaries and any other claimants to receive benefits under the Plan, and
(3) to make factual determinations in connection with any of the foregoing. The
Plan Administrator and the Administrative Committee may, in their discretion,
determine to hold a hearing or hearings in carrying out their responsibilities
and authority under this claims procedure.

         (j) Benefit claim determinations and decisions on appeals shall be
made in accordance with governing Plan documents. The Plan's provisions shall
be applied consistently with respect to similarly situated claimants. The Plan
Administrator and Administrative Committee shall maintain complete records of
their proceedings in deciding claims and appeals. The Plan Administrator and
Administrative Committee shall maintain their records in a manner that permits
them to refer, and they shall so refer, to prior decisions to ensure that the
Plan's provisions are applied consistently with respect to similarly situated
claimants.

                                     VI-6
<PAGE>
         (k)      Definitions. For the purposes of this Section 6.4, the
following definitions apply:

                  "Adverse benefit determination" means any of the following: a
         denial, reduction, or termination of, or a failure to provide or make
         payment (in whole or in part) for, a benefit, including any such
         denial, reduction, termination, or failure to provide or make payment
         that is based on a determination of a Participant's or Beneficiary's
         eligibility to participate in the Plan.

                  A document, record, or other information shall be considered
         "relevant" to a claimant's claim if such document, record, or other
         information (i) was relied upon in making the benefit determination,
         (ii) was submitted, considered, or generated in the course of making
         the benefit determination, without regard to whether such document,
         record, or other information was relied upon in making the benefit
         determination, (iii) demonstrates compliance with the administrative
         processes and safeguards required pursuant to paragraph (j) above in
         making the benefit determination, or (iv) in the case of a claim for
         disability benefits, constitutes a statement of policy or guidance with
         respect to the Plan concerning the denied treatment option or benefit
         for the claimant's diagnosis, without regard to whether such advice or
         statement was relied upon in making the benefit determination.

                  A "claim for disability benefits" means a disability claim
         for the purposes of the requirements of United States Department of
         Labor Regulation Section 2560.503-1.

         6.5 Plan Administrative Committee Actions. Except as otherwise
specifically provided in the Plan, every decision and action of the Plan
Administrator and Plan Administrative Committee shall be by a majority vote of
the Committee or without a formal meeting by the unanimous written consent of a
majority of the members of the Committee then in office. The Committee shall
select a Secretary and any other officers deemed necessary who shall be
authorized to bind the Plan Administrator by their signatures, and shall adopt
rules governing its procedures consistent with the terms of this Plan. The
Committee shall keep a permanent record of its meetings and actions.

         6.6 Investment Manager. All contributions so received together with
the income therefrom shall be managed, invested and reinvested by the Trustee,
subject, however, to the right of the Committee to appoint and employ an
Investment Manager or Managers, to manage and/or invest and reinvest the Trust
Fund, or any part thereof, in which event the Investment Manager shall be
certified as such to the Trustee by the Committee and the Trustee shall not be
liable for the acts or omissions of such Investment Manager or Managers or be
under any obligation to manage or invest the assets of the Trust Fund which are
subject to management by such Investment Manager or Managers. An authorized
officer of any such Investment Manager shall certify in writing to the Trustee
the names of all persons who shall act on behalf of the Investment Manager with
respect to the Trust Fund, and the Trustee may rely thereon in its dealings
with such Investment Manager. Where appropriate, references in this Plan to
"Trustee" may be interpreted to include any Investment Manager appointed under
this Section.

         6.7      Benefit Payment Directions. The Plan Administrator shall
direct the Trustee or shall cause the Trustee to be directed in writing to make
benefit payments from the Trust Fund to

                                     VI-7
<PAGE>
Participants, Spouses or Beneficiaries who qualify for such payments under the
Plan. Such written order to the Trustee shall specify the name, address, Social
Security number, and the amount and frequency of payments to each such
recipient.

         6.8 Nondiscrimination. The Plan Administrator shall act and shall
direct the Trustee to act or cause such action with respect to any Plan
benefits or any other matter under the powers of the Plan Administrator under
this Plan in a uniform and nondiscriminatory manner toward all Participants
and Employees under substantially similar sets of facts and shall not permit
discrimination in favor of highly compensated employees of the Employer.

         6.9 Agents. The Plan Administrator may employ such counsel (who may be
counsel for the Employer), consultants, accountants and other agents as it
shall deem advisable. All costs and expenses of the Plan Administrator and the
fees of legal counsel, consultants, accountants and other agents shall be paid
by the Employer, or the Employer shall cause such costs and expenses to be paid
by the Trustee out of the Trust Fund as provided in Section 12.7.

         6.10 Records and Reports. The Plan Administrator shall keep all
records relating to Participants (including former Participants) and obtain
annual reports from the Trustee and any Investment Manager and collect from the
Trustee and any such Investment Manager and other sources any such records as
are necessary for proper operation of the Plan.

         6.11 Indemnification. The Employer shall indemnify and hold harmless
the Plan Administrator, any member thereof and any Employee who may act on
behalf of an Employer in the administration of this Plan from and against any
liability, loss, cost or expense (including reasonable attorneys' fees)
incurred at any time as a result of or in connection with any claims, demands,
actions or causes of action of any Participants, any person claiming through or
under any of them, or any other person, party or authority claiming to have an
interest in this Plan or Trust Fund or standing to act for any persons or
groups having an interest in this Plan or Trust Fund, for or on account of, any
of the acts or omissions (or alleged acts or omissions) of the Plan
Administrator, any member thereof or any such employee, except to the extent
resulting from such person's willful misconduct.

         6.12 Liquidity and Investments. The Plan Administrator shall be
responsible for establishing a policy to carry out the objectives of the Plan
and a method to determine the liquidity and investments needed under that
policy. At least annually, the Plan Administrator shall communicate information
concerning the short and long-term liquidity and investment needs of the Plan
to the Trustee and any Investment Manager, so that the investment policy of the
Trust Fund can be appropriately coordinated with Plan needs. In investing and
reinvesting the Trust Fund, the Trustee and any Investment Manager shall have
due regard for the funding policy and method of the Plan as communicated to it
by the Plan Administrator, but the Trustee and every Investment Manager each
shall be fully responsible for the selection and retention or disposition of
the investment or reinvestment of the assets of the Trust Fund in its
possession to fulfill such funding policy and method.

         6.13     Power and Duties of the Plan Administrative Committee. The
Plan Administrative Committee shall have absolute discretionary authority to
interpret this Plan and make determinations as to eligibility for benefits, or
construe any other terms of the Plan. The

                                     VI-8
<PAGE>
Plan Administrative Committee shall supervise the administration and
enforcement of the Plan according to the terms and provisions of this Plan and
shall have all powers necessary to accomplish these purposes, including,
without limitation and in addition to any other powers described in this
Article VI, the right, power, authority and duty:

         (a) to make rules, regulations and bylaws for the administration of
the Plan which are not inconsistent with the terms and provisions of this Plan,
provided such rules, regulations and bylaws are evidenced in writing and copies
thereof are delivered to the Trustee and to the Company;

         (b) to construe all terms, provisions, conditions and limitations of
the Plan (in all cases, the construction necessary for the Plan to qualify
under the applicable provisions of the Code shall control);

         (c) to correct any defect or supply any omission or reconcile any
inconsistency that may appear in the Plan, in such manner and to such extent as
it shall deem expedient to carry the Plan into effect for the greatest benefit
of all interested parties;

         (d) to determine all questions relating to eligibility;

         (e) to determine the amount, manner and time of payment of any
Plan benefits and to prescribe procedures to be followed by distributee in
obtaining benefits;

         (f) to prepare, file and distribute, in such manner as the Plan
Administrator determines to be appropriate, such information and material as is
required by the reporting and disclosure requirements of ERISA;

         (g) to make a determination as to the right of any person to a
benefit under the Plan;

         (h) to receive and review reports from the Trustee and any
Investment Manager as to the financial condition of the Trust Fund including
its receipts and disbursements; and

         (i) to delegate, in its sole discretion, any of its powers or duties
to subcommittees, task forces or study groups at such times in such manner as
it shall deem expedient to administer and enforce the Plan in a uniform and
non-discriminatory manner for the benefit of all interested parties.

         6.14 Employer to Supply Information. The Employer shall supply full
and timely information to the Plan Administrator relating to the compensation
of all Participants, their ages, their retirement, death or other cause for
termination of employment and such other pertinent facts as the Plan
Administrator may require. The Employer also shall supply such information to
the Trustee and every Investment Manager as necessary for the Trustee and each
such Investment Manager to carry out its duties. When making a determination in
connection with the Plan, the Plan Administrator shall be entitled to rely upon
information furnished by the Employer; provided, the Plan Administrator shall
resolve any factual dispute under this Plan by giving weight to all information
available to him.

                                     VI-9
<PAGE>
         6.15 Self-Interest. Neither the Plan Administrator nor any member of
the committee, if any, shall have any right to vote or decide upon any matter
related directly or indirectly to him or any right of his to claim any benefit
under the Plan. In any case in which a committee member is so disqualified to
act, and the remaining members cannot agree, the Company shall appoint a
temporary substitute member to exercise all the powers of the disqualified
member concerning the matter in which he is disqualified.

         6.16 Corrections. The Plan Administrator has the authority to take any
appropriate action (including the making of Plan amendments) to correct Plan
qualification failures under the Internal Revenue Service's Employee Plans
Compliance Resolution System ("EPCRS"), or any successor system or other
similar system. The Plan Administrator also has the authority to take any
appropriate action to correct ERISA failures or violations under any system or
program adopted by the U.S. Labor Department that is similar to the EPCRS.

         6.17 New Technologies. Except as otherwise expressly prohibited by the
Plan or any applicable law or regulation, where the Plan or any law or
regulation applicable to the Plan provides for or requires information,
notices, elections, designations and other similar communications relating to
the administration of the Plan to be made or given in writing or pursuant to a
written instrument or the like, or where no particular form for the
communication is provided for or required, then such communications may be
given, and signed (if required), electronically by voice response, by facsimile
(fax), by e-mail, through a website, through the internet or an intranet or by
any other means through so-called new technologies; provided, that if any
applicable law or regulation provides for certain rules or procedures relating
to such use of new technologies, then the person making the communication must
comply with such rules or procedures. This Section 6.17 is effective for Plan
Years beginning after December 31, 2000.

                                     VI-10
<PAGE>

                                  ARTICLE VII

                            TRUST FUND AND TRUSTEE

         7.1 Trust Fund. The Trust Fund shall be held, administered, controlled
and invested by the Trustee. The Trustee shall have no responsibility
whatsoever either for the control, management, administration or amendment of
this Plan or for the amount or payment of Employer Contributions to the Trust
Fund, except to receive, hold, invest, reinvest and distribute the same,
together with earnings thereon, in accordance with the provisions of the Trust
Agreement, which is hereby incorporated by reference. The Plan and Trust are
authorized to acquire and hold qualifying employer securities (as defined in
ERISA Section 407(d)), in an amount up to one hundred percent (100%) of the
Plan assets. Voting, tender and similar rights with respect to qualifying
employer securities will be passed through to Participants and Beneficiaries
with Accounts holding such securities.

                                     VII-1
<PAGE>
                                  ARTICLE VIII

                                  FIDUCIARIES

         8.1 Named Fiduciary. The Plan Administrator is the Named Fiduciary and
shall be responsible for the control, management and administration of this
Plan and the assets of the Trust Fund. The Named Fiduciary shall have no
responsibility to inquire into the acts and omissions of any other fiduciary in
the exercise of powers or the discharge of responsibilities assigned to such
other fiduciary under this Plan.

         8.2 Fiduciary Duty. The Named Fiduciary, and any other fiduciary under
the Plan, shall discharge his duties and responsibilities with respect to the
Plan:

         (a) solely in the interest of the Participants, for the exclusive
purpose of providing benefits to Participants, and their Spouses and
Beneficiaries, and defraying reasonable expenses of administering the Plan; and

         (b) with the care, skill, prudence and diligence under the
circumstances then prevailing that a prudent man acting in a like capacity and
familiar with such matters would use in the conduct of an enterprise of a like
character and with like aims.

Neither the Named Fiduciary nor any other fiduciary shall cause the Plan or
Trust Fund to enter into a "prohibited transaction" as defined in Code Section
4975 or ERISA Section 406, unless a statutory exemption exists or waiver has
been obtained from the Department of Labor.

         8.3 Fiduciary Liability. Neither the Named Fiduciary nor any other
fiduciary shall be liable in any way for the acts or omissions constituting a
breach of fiduciary responsibility which occur prior to the date he becomes a
fiduciary or after the date he ceases to be a fiduciary.

         8.4 Co-Fiduciary Liability. Neither the Named Fiduciary nor any other
fiduciary shall be liable for any breach of fiduciary responsibility by any
other fiduciary unless:

         (a) he participates in, or undertakes to conceal, an act or omission of
such other fiduciary, knowing such act or omission is a breach;

         (b) by his failure to comply with ERISA Section 404(a)(l) in the
administration of his specific responsibilities which give rise to his status
as a fiduciary, he has enabled such other fiduciary to commit a breach; and

         (c) having knowledge of a breach by such other fiduciary, he fails to
make reasonable efforts under the circumstances to remedy the breach.

         8.5 Allocation and Delegation of Responsibilities. The Named
Fiduciary, by written instrument filed by the Plan Administrator with the
records of this Plan, may designate a person who is not a Named Fiduciary to
carry out any of its responsibilities under this Plan; provided, however, that
no such designation shall be effective as to such designated person and to any
other fiduciary until such designated person and such other fiduciary have
received written

                                    VIII-1
<PAGE>
notice of such designation. Finally, no duty or terms of this Plan may be
assigned, allocated or delegated to another fiduciary or to any other person
absent the express written consent of such fiduciary or such other person.

         8.6 Advisors. The Named Fiduciary, or a person designated by the Named
Fiduciary to perform any responsibility of the Named Fiduciary pursuant to the
procedure described in Section 8.5, may employ one or more persons to render
advice with respect to any responsibility such Named Fiduciary has under this
Plan or such other person has by virtue of such designation.

         8.7 Dual Capacities. Any person may serve in more than one fiduciary
capacity under this Plan.

                                    VIII-2
<PAGE>
                                   ARTICLE IX

                           AMENDMENT AND TERMINATION

         9.1 Amendment. The Company reserves the right at any time and from
time to time to amend this Plan in any respect through a written amendment
approved by (i) the Board, or (ii) the Vice-President of Human Resources or
such other person or persons as the Board may empower to approve any such
amendments, provided, no amendment may be made which diverts any of the assets
of the Trust Fund to any purpose other than the exclusive benefit of
Participants and, where appropriate, Spouses or Beneficiaries; provided,
however, to the extent permitted under the Code, this Plan may be amended
retroactively, if necessary, to cause this Plan and the Trust Fund to continue
to be exempt from income taxes. No optional benefit payment forms or early
retirement benefits or subsidies which continue after retirement shall be
eliminated and no vesting percentages shall be reduced by any such amendment,
except as any of the foregoing may be permitted under the Code or relevant
Treasury Regulations promulgated thereunder with respect to tax-qualified
retirement plans.

         9.2 Termination. The Company expects this Plan to be continued
indefinitely but, of necessity, reserves the right at any time through action
of the Board or similar governing body, to terminate or to partially terminate
this Plan and thus to stop all contributions under this Plan, or to continue
this Plan but to discontinue all contributions under this Plan. If this Plan is
terminated or partially terminated, then the Accounts of each affected Employee
shall become completely nonforfeitable from the date of such termination or
partial termination. The Plan Administrator upon any termination or partial
termination of this Plan shall direct the Trustee as to when and what amounts
the Trustee shall distribute the Accounts to Participants and, where
appropriate, Beneficiaries, and the Trustee shall follow such directions as
soon as practicable.

                                     IX-1
<PAGE>
                                   ARTICLE X

                                TOP-HEAVY RULES

         10.1     Top-Heavy Provisions.

         (a) If the Plan is or becomes top-heavy in any Plan Year the
provisions of Section 10.1(a)(i) shall apply, superseding any conflicting
provisions in the Plan.

                  (i) The Company shall make and allocate additional employer
         contributions to the accounts of eligible non-key employees so that
         the amount of employer contributions and forfeitures allocated to the
         accounts of each eligible non-key employee shall not be less than the
         required percentage. However, if the eligible non-key employee is also
         covered under a qualified defined benefit plan of an Employer and
         receives the minimum accrued benefit under such plan required by
         Internal Revenue Code ss. 416(c)(l), no contribution and allocation
         with respect to such employee shall be required under this paragraph
         (i). The minimum allocation required under this Section 10.1 (a) shall
         be made even though, under other Plan provisions, the Participant
         would not otherwise be entitled to receive an allocation for the year
         because of his failure to (1) complete 1,000 hours of service (or any
         equivalent provided in the Plan), or (2) make mandatory employee
         contributions to the Plan, or (3) receive compensation of more than a
         stated amount. The following definitions apply for the purposes of
         this paragraph (i):

                           (A) "Eligible non-key employee" means each non-key
                  employee of the Company who has satisfied the eligibility
                  requirements of Section 2.1 and who is in the employment of
                  an Employer on the last day of the Plan Year.

                           (B) "Required percentage" means the lesser of (i) 3
                  percent of the employee's compensation, or (ii) the
                  percentage of compensation at which the sum of any employer
                  contribution, Employer Matching Contribution and Income
                  Deferral Contribution are made (or required to be made) under
                  the Plan for the Plan Year for the key employee for whom such
                  percentage is the highest for the Plan Year.

                  (ii)     Reserved.

         (b)      The following special definitions apply for the purposes of
this Section 10.1:

                  (i) The term "key employee" shall mean any employee or former
         employee (and the beneficiaries of such employee) who at any time
         during the determination period was an officer of the Employer if such
         individual's annual compensation exceeds fifty percent of the dollar
         limitation under section 415(b)(l)(A) of the Code, an owner (or
         considered an owner under section 318 of the Code) of one of the ten
         largest interests in the Employer if such individual's compensation
         exceeds 100 percent of the dollar limitation under section 415(c)(l)(A)
         of the Code, a five percent owner of the Employer, or a one percent
         owner of the Employer who has an annual compensation of more than
         $150,000. Annual compensation means compensation within the meaning of
         Code

                                      X-1
<PAGE>
         Section 414(q)(4), as limited by Code Section 401(a)(17). The
         "determination period" is the Plan Year containing the determination
         date and the four preceding years. The determination of who is a key
         employee will be made in accordance with section 416(i)(l) of the Code
         and the regulations thereunder. The term "non-key employee" shall mean
         any employee who is not a key employee.

                  (ii) This Plan is "top-heavy", as of the determination date,
         if any of the following condition exists:

                           (A) The top-heavy ratio for this Plan exceeds 60
                  percent and this Plan is not part of any required aggregation
                  group or permissive aggregation group of plans;

                           (B) This Plan is a part of a required aggregation
                  group of plans but not part of a permissive aggregation group
                  and the top-heavy ratio for the group of plans exceeds 60
                  percent; or

                           (C) This Plan is a part of a required aggregation
                  group and part of a permissive aggregation group of plans and
                  the top-heavy ratio for the permissive aggregation group
                  exceeds 60 percent.

                  (iii) The "top-heavy ratio" shall be determined as follows
         under paragraphs (A) through (C):

                           (A) If the Employer maintains one or more defined
                  contribution plans (including any Simplified Employee Pension
                  Plan) and the Employer has not maintained any defined benefit
                  plan which during the 5-year period ending on the
                  determination date(s) has or has had accrued benefits, the
                  top-heavy ratio for this Plan alone or for the required or
                  permissive aggregation group as appropriate is a fraction,
                  the numerator of which is the sum of the account balances of
                  all key employees as of the determination date(s) (including
                  any part of any account balance distributed in the 5-year
                  period ending on the determination date(s)), and the
                  denominator of which is the sum of all account balances
                  (including any part of any account balance distributed in the
                  5-year period ending on the determination date(s)), both
                  computed in accordance with Internal Revenue Code ss. 416 and
                  the regulations thereunder. Both the numerator and
                  denominator of the top-heavy ratio are increased to reflect
                  any contribution not actually made as of the determination
                  date, but which is required to be taken into account on that
                  date under Internal Revenue Code ss. 416 and the regulations
                  thereunder.

                           (B) If the Employer maintains one or more defined
                  contribution plans (including any Simplified Employee Pension
                  Plan) and the Employer maintains or has maintained one or
                  more defined benefit plans which during the 5-year period
                  ending on the determination date(s) has or has had any
                  accrued benefits, the top-heavy ratio for any required or
                  permissive aggregation group as appropriate is a fraction,
                  the numerator of which is the sum of account balances under
                  the aggregated defined contribution plan or plans for all key
                  employees, determined

                                      X-2
<PAGE>
                  in accordance with paragraph 10.1(b)(iii)(A) above, and the
                  present value of accrued benefits under the aggregated
                  defined benefit plan or plans for all key employees as of the
                  determination date(s), and the denominator of which is the
                  sum of the account balances under the aggregated defined
                  contribution plan or plans for all participants, determined
                  in accordance with paragraph 10.1(b)(iii)(A) above, and the
                  present value of accrued benefits under the defined benefit
                  plan or plans for all participants as of the determination
                  date(s), all determined in accordance with Internal Revenue
                  Code ss. 416 and the regulations thereunder. The accrued
                  benefits under a defined benefit plan in both the numerator
                  and denominator of the top-heavy ratio are increased for any
                  distribution of an accrued benefit made in the five-year
                  period ending on the determination date.

                           (C) For purposes of paragraphs 10.1(b)(iii)(A) and
                  (B) above the value of account balances and the present value
                  of accrued benefits will be determined as of the most recent
                  valuation date that falls within or ends with the 12-month
                  period ending on the determination date, except as provided
                  in Internal Revenue Code ss. 416 and the regulations
                  thereunder for the first and second Plan Years of a defined
                  benefit plan. The account balances and accrued benefits of a
                  participant who (1) is not a key employee but who was a key
                  employee in a prior year, or (2) has not been credited with
                  at least one hour of service with any Employer maintaining
                  the Plan at any time during the 5-year period ending on the
                  determination date, will be disregarded. The calculation of
                  the top-heavy ratio, and the extent to which distributions,
                  rollovers, and transfers are taken into account, will be made
                  in accordance with Internal Revenue Code ss. 416 and the
                  regulations thereunder. Deductible employee contributions
                  will not be taken into account for purposes of computing the
                  top-heavy ratio. When aggregating plans the value of account
                  balances and accrued benefits will be calculated with
                  reference to the determination dates that fall within the
                  same calendar year.

                           The accrued benefit of a participant other than a
                  key employee shall be determined under (a) the method, if
                  any, that uniformly applies for accrual purposes under all
                  defined benefit plans maintained by the employer, or (b) if
                  there is no such method, as if such benefit accrued not more
                  rapidly than the slowest accrual rate permitted under the
                  fractional rule of Internal Revenue Code ss. 411(b)(1)(C).

                  (iv) The term "permissive aggregation group" shall mean the
         required aggregation group of plans plus any other plan or plans of
         the Employer which, when considered as a group with the required
         aggregation group, would continue to satisfy the requirements of
         Internal Revenue Code ss.ss. 401(a)(4) and 410.

                  (v) The term "required aggregation group" shall mean (1) each
         qualified plan of the Employer in which at least one key employee
         participates or participated at any time during the determination
         period (regardless of whether the plan has terminated), and (2) any
         other qualified plan of the Employer which enables a plan described in
         clause (1) to meet the requirements of Internal Revenue Code ss.ss.
         401(a)(4) or 410.

                                      X-3
<PAGE>
                  (vi) The term "determination date" means the last day of the
         preceding Plan Year. The accrued benefit under a defined benefit plan
         for a current employee must be determined as if the individual
         terminated service as of the applicable valuation date. For this
         purpose, the valuation date must be the same valuation date for
         computing plan costs for minimum funding, regardless of whether a
         valuation is performed that year. The present value of accrued
         benefits for a defined benefit plan shall be determined by use of the
         same interest and mortality assumptions used by the Plan's actuary for
         minimum funding purposes.

         (c) The minimum allocation required under Section 10.1(a) (to the
extent required to be nonforfeitable under Code Section 416(b)) may not be
forfeited under Code Section 411(a)(3)(B) or 411(a)(3)(D).

         10.2     Minimum Vesting.

         (a) For any Plan Year in which this Plan is top-heavy, the vesting
schedule in paragraph (b) will automatically apply to the Plan. The minimum
vesting schedule applies to all benefits within the meaning of Section 411
(a)(7) of the Code except those attributable to employee contributions,
including benefits accrued before the effective date of Code Section 416 and
benefits accrued before the Plan became top-heavy. Further, no decrease in a
Participant's nonforfeitable percentage may occur in the event the Plan's
status as top-heavy changes for any Plan Year. However, this Section 10.2(a)
does not apply to the Account balances of any employee who does not have an
Hour of Service after the Plan has initially become top-heavy and such
employee's Account balance attributable to employer contributions and
Forfeitures will be determined without regard to this Section 10.2(a).

         (b) If, under the provisions of Section 10.2(a), the vesting
provisions of this Section 10.2(b) become applicable, the nonforfeitable
interest of each Employee in his Account balance shall be one hundred percent
(100%).

                                      X-4
<PAGE>
                                   ARTICLE XI

                  PLAN ADOPTION AND EMPLOYMENT RELATIONSHIPS

         11.1 Joinder of Employers. Any Affiliate or other entity may become an
Employer under this Plan upon approval by the board of directors of such entity
and the Board by executing this Plan or a joinder agreement with the Company.
Any such joinder agreement shall state that the entity agrees to be bound by
this Plan, as then in effect and as amended from time to time thereafter by the
Company, and may set forth special Years of Service rules and any other
relevant provisions applicable to that entity or its employees. Any entity
executing a joinder agreement need not execute the original Plan document to
become an Employer. Regardless of the number of entities that adopt it, this
Plan is intended to be a single plan as defined in Treasury Regulation Section
1.414(l)-l(b)(l).

         11.2     Employment and Years of Service Credit.

         (a)      In general, "employment" refers to employment by any
Employer. However, with respect to a particular Employee, reference to
"Employer" means only the Employer actually employing the Employee at that
time.

         (b) For the purpose of determining his Years of Service under this
Plan, an Employee is entitled to credit for his service with each Employer
while it is an Affiliate. Credit for service with an Employer may include
service before this Plan was adopted or before such Employer became an
Affiliate as provided in this Plan or in specific provisions in any joinder
agreement of such Employer. Nevertheless, once an Employee receives credit for
service with one Employer, becoming an Employee of another Employer will not
cause any loss of service credits by that Employee.

         (c) Service and Compensation with all Employers shall be taken into
account so that a single contribution amount shall be computed for the Employee
under this Plan as if all Employers were a single Employer. If an Employee is
compensated by more than one Employer during a Plan Year, his Compensation
under the Plan for such year is equal to the sum of his Compensation from each
separate Employer. The contributions to this Plan for each Employee with
respect to such year shall be allocated between or among such separate
Employers as determined by the Plan Administrator.

         11.3 Service with Affiliates. If an individual is employed by an
Affiliate, he shall be entitled to service for eligibility and vesting purposes
under this Plan as if such Affiliate were an Employer. However, no such service
shall be allowed with respect to employment by such Affiliate for the period
before it became an Affiliate or for any period after it ceased to be an
Affiliate, unless specifically provided for in the Plan or in the joinder
agreement by which it became an Employer.

                                     XI-1
<PAGE>
                                   ARTICLE XII

                                 MISCELLANEOUS

         12.1     Nature of Plan. This Plan also established, in part, an
individual account plan with a cash or deferred arrangement. The Income Deferral
Contributions shall only be made to the cash or deferred arrangement portion of
this Plan. This Plan also established Employee After-Tax Accounts intended to
facilitate employee savings.

         12.2     Discrimination. The Plan Administrator shall administer this
Plan in a uniform and consistent manner with respect to all Participants,
Spouses and Beneficiaries and shall not permit discrimination in favor of highly
compensated employees.

         12.3     Merger or Consolidation. In the case of any merger or
consolidation with, or transfer of assets or liabilities to any other employee
benefit plan, each person for whom an Account is maintained shall be entitled to
receive a benefit from this Plan, if it then terminates, which is equal to or
greater than the benefit he would have been entitled to receive immediately
before such merger, consolidation or transfer, if this Plan then had terminated.

         12.4     Additional Procedures. Any rules, regulations or procedures
that may be necessary for the proper administration or functioning of this Plan
that are not covered in this Plan shall be promulgated and adopted by the Plan
Administrator.

         12.5     Qualified Domestic Relations Order. In accordance with uniform
and nondiscriminatory procedures established by the Company from time to time,
the Company upon the receipt of a domestic relations order which seeks to
require the distribution of a Participant's Account in whole or in part to an
"alternate payee" (as defined in Code Section 414(p)(8)) shall:

         (a)      promptly notify the Participant and such alternate payee of
the receipt of such order and of the procedure which the Company will follow to
determine whether such order constitutes a "qualified domestic relations order"
within the meaning of Code Section 414(p);

         (b)      determine whether such order constitutes a qualified domestic
relations order, notify the Participant and the alternate payee of the results
of such determination and, if the Company determines that such order does
constitute a qualified domestic relations order;

         (c)      transfer such amounts, if any, as the Company determines
necessary or appropriate from the Participant's Account to a special account for
such alternate payee; and

         (d)      make the distribution to such alternate payee from such
special account as the Company deems called for under the terms of such order in
accordance with Code Section 414(p), even if such terms require a distribution
to such alternate payee before the date a distribution can be made to the
Participant.

         12.6     Agent for Service of Process. The agent for service of process
for this Plan shall be the person currently serving in the State of North
Carolina as the registered agent for service of process for the Plan
Administrator.

                                      XII-1
<PAGE>

         12.7     Expenses. The Employer may pay all costs, expenses and fees
incurred in providing services to the Plan and all other costs and expenses of
administering and operating the Plan. The Company shall direct the Trustee to
pay from the Trust Fund any expenses which the Employer does not pay or for
which the Employer may not be liable, such as real and personal property taxes,
income taxes, excise taxes, transfer taxes and any and all expenses of a similar
nature which may be levied on or chargeable on account of the Trust Fund. Such
expenses, until they are paid, shall constitute a charge against the Trust Fund
to be satisfied before any distribution under Section 9.2.

         12.8     Diversion. Neither the Employer nor any other Affiliate shall
be entitled to any part of the corpus or income of the Trust Fund and no part of
the Trust Fund shall be used for or diverted to purposes other than the
exclusive benefit of Participants, Spouses and Beneficiaries, except as
otherwise specifically provided in the Plan (e.g., Sections 3.6 and 5.9).

         12.9     Agreement Not an Employment Contract. This Plan shall not be
deemed to constitute a contract between any Employer and any Participant or to
be a consideration or an inducement for the employment of any Participant. This
Plan shall not be deemed to give any Participant or other Employee the right to
be retained in the service of any Employer or to interfere with the right of any
Employer to discharge any Participant or other Employee at any time regardless
of the effect which such discharge shall have upon such person as a Participant
in this Plan. This Plan shall not be deemed to give any Employer the right to
require any Participant or other Employee to remain in the employ of any
Employer or other Affiliate or to restrict any such person's right to terminate
his employment at any time.

         12.10    Severability. If any provision of this Plan shall be held
invalid for any reason, such illegality or invalidity shall not affect the
remaining parts of this Plan and this Plan shall be construed and enforced as if
such illegal and invalid provisions had never been included.

         12.11    USERRA (Uniformed Services Employment and Reemployment Rights
Act of 1994).

         (a)      Purpose. The purpose of this Section 12.11 is to comply with
the requirements and provisions of the Uniformed Services Employment and
Reemployment Rights Act ("USERRA") applicable to qualified retirement plans and
of Code Section 414(u). To the extent not set forth below, such requirements and
provisions are hereby incorporated by reference.

         (b)      Compensation. For the purposes of (i) determining the
Employee's Compensation or other compensation or pay upon which the amount of
the Employee's accrued benefit under the Plan is determined, (ii) Articles III
and IV, and (iii) any other application of Code Section 415(c)(3), an Employee
who is in Qualified Military Service shall be treated as receiving compensation
from the Employer during such period of Qualified Military Service equal to: (x)
the compensation the Employee would have received during such period if the
Employee were not in Qualified Military Service, determined based on the rate of
pay the Employee would have received from the Employer but for absence during
the period of qualified military leave; or (y) if the compensation the Employee
would have received during such period was not reasonably certain, the
Employee's average compensation from the Employer during the

                                      XII-2
<PAGE>

12-month period immediately preceding the Qualified Military Service (or, if
shorter, the period of employment immediately preceding the Qualified Military
Service).

         (c)      Allocation of Employer Contribution. An allocation of
contributions from the Employer shall be made for the Employee's account, upon
the Employee's reemployment under chapter 43 of title 38, United States Code, in
the same manner and to the same extent an allocation has been made for other
Employees during the Employee's period of Qualified Military Service. For the
purpose of determining the amount of the contribution allocation, earnings and
forfeitures shall not be included. However, if such allocation is contingent
upon the making of, or derived from, employee contributions or elective
deferrals (as defined in Code Section 402(g)(3)), such allocation shall be made
only the to the extent the Employee makes payment to the Plan with respect to
such contributions or deferrals. No such payment may exceed the amount the
Employee would have been permitted or required to contribute had the Employee
remained continuously employed by the Employer throughout the period of
Qualified Military Service. Any such payment to the Plan by the Employee must be
made during the period beginning with the date of reemployment and whose
duration is three times the period of Qualified Military Service, such payment
period not to exceed five years.

         (d)      Break in Service. An individual reemployed under chapter 43 of
title 38, United States Code, shall not be treated as having a break in service,
Period of Severance, or the like by reason of such individual's period of
Qualified Military Service.

         (e)      Vesting Service. Each period of Qualified Military Service
served by an individual shall, upon the individual's reemployment under chapter
43 of title 38, United States Code, be deemed to constitute service with the
Employer for the purpose of determining the nonforfeitability of the
individual's accrued benefits under the Plan.

         (f)      Loan Suspension. The Plan may suspend the individual's
obligation to repay any Plan loan to the individual during the individual's
period of service in the uniformed services (as defined in chapter 43 of title
38, United States Code) regardless of whether such service is Qualified Military
Service and such suspension shall not be taken into account for purposes of Code
Sections 72(p), 401(a) or 4975(d)(l). "Plan loan" means a loan to the individual
under the terms of the Plan's program for making loans to Plan Participants.

                                      XII-3
<PAGE>

                                  ARTICLE XIII

                       TRANSFER OF ASSETS FROM THE FEDERAL
                  PACKAGING CORPORATION RETIREMENT SAVINGS PLAN

         13.1     Effective Date of Transfer. The employee elective accounts of
participants in the Federal Packaging Corporation Retirement Savings Plan
("Federal Plan") shall be transferred to the Caraustar Industries, Inc.
Employees' Savings Plan ("Caraustar Plan") as of June 1, 1994, or as soon
thereafter as is reasonably possible.

         13.2     Eligibility and Participation. For the purpose of determining
whether an individual has satisfied the Caraustar Plan's eligibility service
requirements, individuals who were employees of Federal Packaging Corporation
("Federal") on October 22, 1993, the date the Company acquired all of Federal's
stock, shall be entitled to credit for such service with Federal prior to
October 22, 1993. All Federal employees eligible to participate in the Federal
Plan on December 31, 1993 shall be eligible to participate in the Caraustar Plan
effective January 1, 1994.

         13.3     Vesting. All employee elective accounts transferred from the
Federal Plan to the Caraustar Plan shall at all times remain 100% vested.

         13.4     Separate Accounts. The Federal Plan accounts that are
transferred to the Caraustar Plan will be maintained as separate accounts. For
each former Federal Plan participant there will be established under the
Caraustar Plan a Prior Plan Account to hold funds transferred from the Federal
Plan.

         13.5     Rules Governing Accounts Transferred from the Federal Plan.
The rules of the Caraustar Plan applicable to Income Deferral Contributions will
govern accounts transferred from the Federal Plan.

                                     XIII-1
<PAGE>

                                   ARTICLE XIV

            MERGER OF FEDERAL PACKAGING CORPORATION SAVINGS PLAN FOR
                      COLLECTIVE BARGAINING UNIT EMPLOYEES

         14.1     Effective Date of Merger. The Federal Packaging Corporation
Savings Plan for Collective Bargaining Unit Employees ("Federal Collective
Bargaining Unit Plan") shall merge into the Caraustar Industries, Inc.
Employees' Savings Plan ("Caraustar Plan") effective September 1, 1994. Federal
Collective Bargaining Unit Plan assets will become Caraustar Plan assets
effective September 1, 1994.

         14.2     Eligibility and Participation. All collective bargaining unit
employees of Federal Packaging Corporation ("Federal") eligible to participate
in the Federal Collective Bargaining Unit Plan on August 31, 1994 shall be
eligible to participate in the Caraustar Plan effective September 1, 1994. Each
collective bargaining unit employee who was employed by Federal prior to
September 1, 1994, and who has begun, but not completed, his probationary period
(as defined by Federal, but not to exceed 60 days of employment) as of such
date, shall be eligible to participate in the Plan after completing his
probationary period. Such participation shall begin as of the entry date next
following the date of completion of the probationary period. All other Federal
collective bargaining unit employees will become Participants in the Caraustar
Plan as provided under Article II of the Caraustar Plan.

         14.3     Vesting and Accounts. All employee elective accounts
transferred from the Federal Collective Bargaining Unit Plan to the Caraustar
Plan shall at all times remain 100% vested. The transferred accounts will become
Caraustar Plan Income Deferral Accounts for the applicable Participants.

                                      XIV-1
<PAGE>

                                   ARTICLE XV

           TRANSFER OF ASSETS FROM THE GARBER COMPANY 401(K) SALARIED
         RETIREMENT SAVINGS PLAN AND THE SPECIAL PACKAGING, INC. 401(K)
                        SALARIED RETIREMENT SAVINGS PLAN

         15.1     Effective Date of Transfer. The accounts of participants in
the Garber Company 401(k) Salaried Retirement Savings Plan and the Special
Packaging, Inc. 401(k) Salaried Retirement Savings Plan (the "Garber Plan" and
the "Special Plan") shall be transferred to the Caraustar Industries, Inc.
Employees Savings Plan ("Caraustar Plan") as of February 1, 1997, or as soon
thereafter as is reasonably possible. The accounts so transferred shall be
transferred in accordance with Code Sections 414(l) and 411(d)(6) and the
Caraustar Plan Trustee shall accept such accounts.

         15.2     Eligibility and Participation. For the purpose of determining
whether an individual has satisfied the Caraustar Plan's eligibility service
requirements, individuals who were employees of Garber Company ("Garber")
and Special Packaging, Inc. ("Special"), shall be entitled to credit for such
service with Garber and Special prior to January 1, 1997.

         15.3     Vesting. All employee accounts transferred from the Garber
Plan or the Special Plan to the Caraustar Plan shall at all times be 100%
vested.

         15.4     Transfer to Caraustar Accounts. The Garber Plan and Special
Plan accounts that are transferred to the Caraustar Plan will be transferred to
accounts in the Caraustar Plan. The character of the funds so transferred will
be retained in the account to which it is transferred (i.e.: Income Deferral,
Employer Contribution, Rollover).

         15.5     Rules Governing Garber Plan and Special Plan Accounts. The
rules of the Caraustar Plan will govern the accounts transferred from the Garber
Plan or the Special Plan.

                                      XV-1
<PAGE>

                                   ARTICLE XVI

             MERGERS INTO THE CARAUSTAR PLAN EFFECTIVE APRIL 1, 1998

         16.1     Effective Date of Merger. Effective April 1, 1998, the
following plans shall be merged into the Caraustar Industries, Inc. Employees'
Savings Plan ("Caraustar Plan"):

         (a)      New General Packaging Service 401(k) Plan ("New General Plan")

         (b)      Oak Tree Packaging Corporation Salaried/Palmer Hourly 401(k)
Plan ("Salaried/Palmer Plan")

         (c)      Oak Tree Packaging Corporation York Hourly 401(k) Plan ("York
Plan")

         (d)      Oak Tree Packaging Corporation Versailles Hourly 401(k) Plan
("Versailles Plan").

         Assets of each of the 401(k) Plans listed immediately above will become
assets of the Caraustar Plan effective April 1, 1998 and will be transferred to
the Trust Fund of the Caraustar Plan as soon thereafter as is reasonably
possible. These Plans shall be merged in accordance with Code section 414(1) and
411(d)(6) and the Caraustar Plan Trustee shall accept all accounts and assets of
the 401(k) Plans listed immediately above.

         16.2     Eligibility and Participation. For the purpose of determining
whether an individual has satisfied the Caraustar Plan's eligibility service
requirements, individuals who were employees of General Packaging Service, Inc.
or Oak Tree Packaging Corporation shall be entitled to credit in the Caraustar
Plan for service with either company prior to the acquisition of either company
by the Company.

         16.3     Vesting. All accounts of each employee transferred from any of
the 401(k) Plans listed immediately above to the Caraustar Plan shall at all
times be 100% vested.

         16.4     Transfer to Caraustar Accounts. The accounts that are
transferred from each of the 401(k) Plans listed immediately above to the
Caraustar Plan will be transferred to accounts in the Caraustar Plan. The
character of the funds so transferred will be retained in the account to which
it is transferred (i.e., Income Deferral, Employer Contribution, Rollover).

                                      XVI-1
<PAGE>

                                  ARTICLE XVII

              MERGER INTO THE CARAUSTAR PLAN EFFECTIVE JUNE 30, 1998

         17.1     Effective Date of Merger. Effective June 30, 1998, the
Chesapeake Paperboard Company 401(k) Plan for the Salaried Employees of
Chesapeake Paperboard Company and Chesapeake Fiber Packaging Corporation
("Chesapeake Plan") shall be merged into the Caraustar Plan. Assets of the
Chesapeake Plan will become assets of the Caraustar Plan effective June 30, 1998
and will be transferred to the Trust Fund of the Caraustar Plan as soon
thereafter as is reasonably possible. The Chesapeake Plan shall be merged in
accordance with Code section 414(7) and 411(d)(6) and the Caraustar Plan Trustee
shall accept all accounts and assets of the Plan.

         17.2     Eligibility and Participation. For the purpose of determining
whether an individual has satisfied the Caraustar Plan's eligibility service
requirements, individuals who were employees of Chesapeake Paperboard Company or
Chesapeake Fiber Packaging Corporation shall be entitled to credit in the
Caraustar Plan for service with either company prior to the acquisition of
either company by the Company.

         17.3     Vesting. All accounts of each employee transferred from the
Chesapeake Plan to the Caraustar Plan shall at all times be 100% vested.

         17.4     Transfer to Caraustar Accounts. The accounts that are
transferred from the Chesapeake Plan will be transferred to accounts in the
Caraustar Plan. The character of the funds so transferred will be retained in
the account to which it is transferred (i.e., Income Deferral, Employer
Contribution, Rollover).

         17.5     Special Rules for Chesapeake Plan Accounts. Effective prior to
July 15, 2002, the special rules set forth in sections 17.5(a) and (b) shall
apply with regard to the Chesapeake Plan Accounts maintained in the Caraustar
Plan. Except for these special rules, the rules of the Caraustar Plan shall
govern the accounts transferred from the Chesapeake Plan. Effective July 15,
2002, notwithstanding other provisions of the Plan, sections 17.5(a) and (b)
shall no longer be applicable and the rules of the Caraustar Plan will govern
accounts transferred from the Chesapeake Plan.

         (a)      Forms of Payment. If the value of the Participant's benefits
attributable to funds transferred from the Chesapeake Plan exceeds or ever
exceeded $3,500 (provided however, that effective January 1, 1999, such amount
shall be $5,000, and effective October 17, 2000 the words "or ever exceeded"
shall be given no effect), all benefits payable from the Chesapeake Plan
Account(s) shall be distributed in accordance with one of the following methods
as the Participant or Beneficiary, as the case may be, may elect in writing
pursuant to a Qualified Election:

                  (i)      In equal monthly, quarterly or annual installments
         over a period certain not to exceed the life expectancy of the
         Participant (or Beneficiary in the case of a Participant who dies prior
         to the time his benefits commence) or the joint and last survivor life
         expectancy of the Participant and his Beneficiary so that the amount
         distributed in each Plan Year equals the amount determined by dividing
         the Participant's vested Account(s) balance on the last day of the
         immediately preceding Plan Year by the

                                     XVII-1
<PAGE>

         period certain determined in accordance with this paragraph which shall
         be reduced by one for each Plan Year after the Plan Year in which the
         Participant's benefits commence.

                  (ii)     Payment to the Participant or Beneficiary of all or
         part of the Chesapeake Account(s) in a single lump sum payment.

         (b)      The election of the form of payment shall be governed by the
rules of Plan Section 5.2.

                                     XVII-2
<PAGE>

                                  ARTICLE XVIII

                   MERGER OF CRANE CARTON COMPANY 401(K) PLAN

         18.1     Effective Date of Merger. The Crane Carton Company 401(k) Plan
("Crane Plan") shall merge into the Caraustar Industries, Inc. Employees'
Savings Plan ("Caraustar Plan") effective March 1, 2001, and Crane Plan assets
will become Caraustar Plan assets effective as of such date.

         18.2     Eligibility and Participation. All employees of Crane Carton
Company ("Crane") as of January 1, 2001, shall be eligible for participation in
the Caraustar Plan subject to the provisions of Article II. For the purposes of
determining eligibility for participation, such employees shall receive credit
for service with Crane prior to January 1, 2001.

         18.3     Vesting and Accounts. All employee accounts transferred from
the Crane Plan to the Caraustar Plan shall at all times remain 100% vested.
Employee accounts in the Crane Plan shall be transferred to accounts in the
Caraustar Plan as follows: from the Crane Plan's unrelated rollover account to
the Rollover Account, from the Crane Plan's employee pre-tax account to the
Prior Plan Account, from the Crane Plan's employee pre-tax match account to the
Prior Company Match Post-'92 Account, and from the Crane Plan's employer account
to the Prior Plan Profit Sharing Account.

                                     XVIII-1
<PAGE>

                                  ARTICLE XIX

               MERGER OF ARROW PAPER PRODUCTS HOURLY 401(K) PLAN

         19.1     Effective Date of Merger. The Arrow Paper Products Hourly
401(k) Plan (the "Arrow Plan") shall merge into the Caraustar Industries, Inc.
Employees' Savings Plan ("Caraustar Plan") effective May 1, 2002, and Arrow
Plan assets will become Caraustar Plan assets effective as of such date.

         19.2     Eligibility and Participation. Effective as of October 1,
2000 (with respect to salaried Employees), and as of May 1, 2001 (with respect
to other Employees), Employees formerly employed by Arrow Paper Products
Company ("Arrow") shall be eligible for participation in the Caraustar Plan
subject to the provisions of Article II. For the purposes of determining
eligibility for participation, such employees shall receive credit for service
with Arrow prior to September 29, 2000.

         19.3     Vesting and Accounts. All accounts transferred from the Arrow
Plan to the Caraustar Plan shall at all times remain 100% vested. Accounts in
the Arrow Plan shall be transferred to accounts in the Caraustar Plan as
follows: from the Arrow Plan's rollover account to the Rollover Account, from
the Arrow Plan's elective deferral account to the Income Deferral Contributions
Account, and from the Arrow Plan's qualified matching contribution account to
the Prior Plan Qualified Matching Contribution Account. For purposes of
determining the vested percentage of contributions made under the Caraustar
Plan on and after September 29, 2000, Employees shall receive credit for
service with Arrow prior to September 29, 2000.

         19.4     Non-Discrimination Testing Under Arrow Plan. Under the Arrow
Plan, the prior year testing method was used for computing the actual deferral
percentage test and the actual contribution percentage test for each applicable
plan year beginning with the 1997 plan year.

                                     XIX-1

<PAGE>

                                   ARTICLE XX

                             MULTIPLE EMPLOYER PLAN

         20.1     General. As provided in Section 11.1, the Plan may be adopted
by employers that are not Affiliates of Caraustar Industries, Inc. If the Plan
is adopted by any such other employer or employers, the Plan shall nevertheless
be a single plan (within the meaning of Internal Revenue Code ss. 414(l) and the
regulations thereunder) with respect to all such employers collectively, with
contributions from individual employers available to pay benefits to all
participants. The Plan shall also be a multiple employer plan subject to the
provisions of Internal Revenue Code ss. 413(c) and the regulations thereunder.

         20.2     Procedure for Adoption by Other Employers. Other employers
that are not Affiliates of Caraustar Industries, Inc. may adopt the Plan under
the provisions of Section 11.1. Any such other employer may withdraw from the
Plan, or Caraustar Industries, Inc. may require such withdrawal, at any time.
Such withdrawal shall be made by written notice by such other employer, or
Caraustar Industries, Inc., as applicable, to all other employers (including
Caraustar Industries, Inc.) that have adopted the Plan. In such event, Caraustar
Industries, Inc. shall, as soon as reasonably practicable and with a view to
minimizing expenses to the Plan, to itself and to the other employers, and in
light of the need to satisfy all applicable legal requirements, split the Plan
into two or more plans to carry out such withdrawal.

         20.3     Separate Application of Provisions. Except as provided in the
joinder agreement referred to in Section 11.1, the provisions of the Plan
document shall apply separately to Caraustar Industries, Inc. and to each other
employer adopting the Plan, except that employees of Caraustar Industries, Inc.
and any other employer that adopts the Plan shall be entitled to credit for
service with each such other employer. For example (and without limitation), (1)
the provisions of Code Sections 401(a)(4), 401(k), 401(m) and 410(b) shall be
applied separately to Caraustar Industries, Inc. and each non-Affiliate employer
adopting the Plan, and (2) the annual compensation limitation of Caraustar
Industries, Inc. and any such other employer shall be determined separately
under Section 3.8(a)(ii). For the purposes of Article X, the term "Company"
shall refer to each adopting employer separately.

                      (signatures begin on following page)

                                      XX-1
<PAGE>

         IN WITNESS WHEREOF, the Company has caused this Plan to be executed by
its duly authorized officers this 15th day of December, 2002.

                                    COMPANY:

                                    CARAUSTAR INDUSTRIES, INC.

(CORPORATE SEAL)
                                    By:    /s/ Barry Smedstad
                                          ------------------------------
                                    Title: Vice President, Human
                                           Resources and Public Relations
                                          ------------------------------

ATTEST:

/s/ Marinan R. Mays
-----------------------
Title: Corporate Secretary
      -----------------------

EMPLOYERS:

CARAUSTAR CUSTOM PACKAGING GROUP, INC.

By:    /s/ Ronald J. Domanico
      -----------------------
Title: VP
      -----------------------

CARAUSTAR RECOVERED FIBER GROUP, INC.

By:    /s/ Ronald J. Domanico
      -----------------------
Title: VP
      -----------------------

CARAUSTAR INDUSTRIAL AND CONSUMER PRODUCTS GROUP, INC.

By:    /s/ Ronald J. Domanico
      -----------------------
Title: VP
      -----------------------

                                        1
<PAGE>

CARAUSTAR MILL GROUP, INC.

By:    /s/ Ronald J. Domanico
      -----------------------
Title: VP
      -----------------------

CARAUSTAR CUSTOM PACKAGING GROUP (MARYLAND), INC.

By:    /s/ Ronald J. Domanico
      -----------------------
Title: VP
      -----------------------

SPRAGUE PAPERBOARD, INC.

By:    /s/ Ronald J. Domanico
      -----------------------
Title: VP
      -----------------------

HALIFAX PAPERBOARD COMPANY, INC.

By:    /s/ Ronald J. Domanico
      -----------------------
Title: VP
      -----------------------

PREMIER BOXBOARD LIMITED, LLC

By: PBL, Inc., its Manager

By:    /s/ Ronald J. Domanico
      -----------------------
Title: VP
      -----------------------

                                        2
<PAGE>

                                   APPENDIX A
                                     TO THE
               CARAUSTAR INDUSTRIES, INC. EMPLOYEES' SAVINGS PLAN

            Period of Eligibility Service Required for Eligibility to
                             Participate in the Plan

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------
                                                Salaried Employees    Hourly Employees
                                                     (Days)                (Days)
------------------------------------------------------------------------------------------------------
<S>                                             <C>                   <C>
  Caraustar Corporate Headquarters                      0                   N/A
------------------------------------------------------------------------------------------------------
  MILL GROUP
------------------------------------------------------------------------------------------------------
  Austell Box Board                                     0                    30
------------------------------------------------------------------------------------------------------
  Sweetwater Paper Board                                0                    30
------------------------------------------------------------------------------------------------------
  Camden Paperboard (closed)                            0                    30
------------------------------------------------------------------------------------------------------
  Buffalo Paperboard                                    0              0 Non-Union
                                                                         120 Union
------------------------------------------------------------------------------------------------------
  Chicago Paperboard (closed)                           0                    90
------------------------------------------------------------------------------------------------------
  Chattanooga Paperboard                                0                    90
------------------------------------------------------------------------------------------------------
  Cincinnati Paperboard                                 0                    90
------------------------------------------------------------------------------------------------------
  Carotell Paper Board                                  0                    30
------------------------------------------------------------------------------------------------------
  Reading Paperboard                                    0                    60
------------------------------------------------------------------------------------------------------
  Carolina Paper Board                                  0                    60
------------------------------------------------------------------------------------------------------
  Richmond Paperboard                                   0                    90
------------------------------------------------------------------------------------------------------
  Rittman Paperboard                                    0                    45
------------------------------------------------------------------------------------------------------
  Tama Paperboard                                       0                    30
------------------------------------------------------------------------------------------------------
  Chesapeake Paperboard (closed)                        0                    60
------------------------------------------------------------------------------------------------------
  Halifax Mill                                          0                    90
------------------------------------------------------------------------------------------------------
  Halifax-Richmond Converting (closed)                  0                    90
------------------------------------------------------------------------------------------------------
  Sprague Paperboard                                    0                    90
------------------------------------------------------------------------------------------------------
  Carolina Component Concepts                           0                    90
------------------------------------------------------------------------------------------------------
  Premier Boxboard Limited                              0                    90
------------------------------------------------------------------------------------------------------
  Carolina Converting, Inc.                             0                    90
------------------------------------------------------------------------------------------------------
  Paradigm Chemical & Consultant                        0                   N/A
------------------------------------------------------------------------------------------------------
  Cedartown Paperboard                                  0                    60
------------------------------------------------------------------------------------------------------
  Lafayette Paperboard                                  0              First of month
                                                                       after hire date
------------------------------------------------------------------------------------------------------
  Tacoma Paperboard - PACE Local #8-0279                0              First of month
                                                                       after hire date
------------------------------------------------------------------------------------------------------
  Covington Partition                                   0              First of month
                                                                       after 90 days
------------------------------------------------------------------------------------------------------
  Frenchtown Partition                                  0              First of month
                                                                       after 90 days
------------------------------------------------------------------------------------------------------
  Litchfield Partition                                  0              First of month
                                                                       after 90 days
------------------------------------------------------------------------------------------------------
  CUSTOM PACKAGING GROUP
------------------------------------------------------------------------------------------------------
  Randleman Carton (Mid-State Paper Box Co.)            0                    30
------------------------------------------------------------------------------------------------------
  Charlotte Carton (Atlantic Coast Carton Co.)          0                    30
------------------------------------------------------------------------------------------------------
  Archdale Carton (Packrite Packaging, Inc.)            0                    30
  (closed merger with Randleman)
------------------------------------------------------------------------------------------------------
</TABLE>

                                       A-l
<PAGE>

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------
                                                Salaried Employees         Hourly Employees
                                                     (Days)                     (Days)
------------------------------------------------------------------------------------------------------
<S>                                             <C>                     <C>

------------------------------------------------------------------------------------------------------
  (CUSTOM PACKAGING GROUP CONT.)
------------------------------------------------------------------------------------------------------
  Burlington Rigid Box (Carolina Paper Box Co.,
  Inc.)                                                 0                         30
------------------------------------------------------------------------------------------------------
  Kingston Springs Carton (Mid Packaging Group
  - Tennessee)                                          0                         30
------------------------------------------------------------------------------------------------------
  Ashland (Garber Company)                              0                         60
------------------------------------------------------------------------------------------------------
  Special Packaging - Bucyrus, Robersonville,
  Strasburg                                             0                         60
------------------------------------------------------------------------------------------------------
  Clifton Primary Contract Pkg. (General                                    60 - Non Union
  Packaging Services - Clifton)                         0               Bargained - Ineligible
------------------------------------------------------------------------------------------------------
  Montvale Design Services                              0                         45
------------------------------------------------------------------------------------------------------
  Palmer Carton Plant                                   0                         45
------------------------------------------------------------------------------------------------------
  Versailles Carton Plant                               0                         45
------------------------------------------------------------------------------------------------------
  York Carton Plant                                     0                         45
------------------------------------------------------------------------------------------------------
  Hunt Valley (Chesapeake Fiber)                        0                    Not Eligible
------------------------------------------------------------------------------------------------------
  Birmingham Carton (Boxall Inc.)                       0                         30
------------------------------------------------------------------------------------------------------
  Caraustar Custom Packaging - Midwest -
  Denver L-435                                          0                         60
------------------------------------------------------------------------------------------------------
  CCP - Midwest - Grand Rapids L-555-S                  0                         60
------------------------------------------------------------------------------------------------------
  CCP - Midwest - Mentor L-546                          0                    Not Eligible
------------------------------------------------------------------------------------------------------
  CCP - Midwest - Salt Lake GCU2 (closed)               0                         30
------------------------------------------------------------------------------------------------------
  CCP - Midwest - St. Louis L-6M                        0                    Not Eligible
------------------------------------------------------------------------------------------------------
  CCP - Midwest - Salaried                              0                        N/A
------------------------------------------------------------------------------------------------------
  Pine Brook (MilPak)                                   0                         30
------------------------------------------------------------------------------------------------------
  Chicago Carton (Crane)                                0                         90
------------------------------------------------------------------------------------------------------
  Cleveland Digital Imaging Center                      0                         30
------------------------------------------------------------------------------------------------------
  RECOVERED FIBER GROUP
------------------------------------------------------------------------------------------------------
  Doraville Recycling Plant                             0                         30
------------------------------------------------------------------------------------------------------
  Charlotte Recycling Plant                             0                         30
------------------------------------------------------------------------------------------------------
  Columbus Recycling Plant                              0                         30
------------------------------------------------------------------------------------------------------
  Macon Recycling Plant (closed)                        0                         30
------------------------------------------------------------------------------------------------------
  Dalton Recycling Plant                                0                         30
------------------------------------------------------------------------------------------------------
  Cleveland Recycling Plant PS L-244                    0                         30
------------------------------------------------------------------------------------------------------
  Texarkana Recycling Plant                             0                         30
------------------------------------------------------------------------------------------------------
  Caraustar Paper Sales North                           0                        N/A
------------------------------------------------------------------------------------------------------
  Caraustar Paper Sales South                           0                        N/A
------------------------------------------------------------------------------------------------------
  Hardeeville Recycling Plant                           0                         30
------------------------------------------------------------------------------------------------------
  Etowah/Port (closed)                                  0                         30
------------------------------------------------------------------------------------------------------
  Halifax Recycling (closed)                            0                         30
------------------------------------------------------------------------------------------------------
</TABLE>

                                       A-2
<PAGE>
<Table>
<Caption>
                                                                                SALARIED EMPLOYEES               HOURLY EMPLOYEES
                                                                                     (DAYS)                           (DAYS)
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                                             <C>                              <C>
------------------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL & CONSUMER PRODUCTS GROUP
------------------------------------------------------------------------------------------------------------------------------------
ICPG Arrow Bargained                                                                     0                              60
------------------------------------------------------------------------------------------------------------------------------------
ICPG Minerva L-7243-51                                                                   0                              60
------------------------------------------------------------------------------------------------------------------------------------
ICPG Minerva Team L92                                                                    0                              60
------------------------------------------------------------------------------------------------------------------------------------
ICPG Perrysburg L7243                                                                    0                              60
------------------------------------------------------------------------------------------------------------------------------------
ICPG/Federal Pkg. Non Union (includes New Smyrna Beach)                                  0                              30
------------------------------------------------------------------------------------------------------------------------------------
ICPG Orrville L-150                                                                      0                              30
------------------------------------------------------------------------------------------------------------------------------------
ICPG St. Paris L-1467                                                                    0                              30
------------------------------------------------------------------------------------------------------------------------------------
Beardstown Tube - SEIU                                                                   0                              60
------------------------------------------------------------------------------------------------------------------------------------
Cedartown Tube - UNITE Local #2423B                                                      0                              60
------------------------------------------------------------------------------------------------------------------------------------
Columbus Tube - UIW                                                                      0                              60
------------------------------------------------------------------------------------------------------------------------------------
Crossett Tube - PACE Local #796                                                          0                              60
------------------------------------------------------------------------------------------------------------------------------------
DeQuincy Tube - UNITE                                                                    0                              60
------------------------------------------------------------------------------------------------------------------------------------
Hendersonville Tube - UNITE Local #1752                                                  0                              60
------------------------------------------------------------------------------------------------------------------------------------
Jacksonville Tube - UNITE Local #360                                                     0                              60
------------------------------------------------------------------------------------------------------------------------------------
Mobile Tube - UNITE                                                                      0                              60
------------------------------------------------------------------------------------------------------------------------------------
Saginaw Tube - IBT Teamsters                                                             0                              60
------------------------------------------------------------------------------------------------------------------------------------
Altavista Tube Plant                                                                     0                              30
------------------------------------------------------------------------------------------------------------------------------------
Amarillo Tube Plant                                                                      0                              30
------------------------------------------------------------------------------------------------------------------------------------
Arlington Tube Plant                                                                     0                              30
------------------------------------------------------------------------------------------------------------------------------------
Austell Tube Plant                                                                       0                              30
------------------------------------------------------------------------------------------------------------------------------------
Cantonment Tube Plant                                                                    0                              30
------------------------------------------------------------------------------------------------------------------------------------
Caraustar Adhesives                                                                      0                              30
------------------------------------------------------------------------------------------------------------------------------------
Cedar Springs Tube Plant                                                                 0                              30
------------------------------------------------------------------------------------------------------------------------------------
Cleveland Tube Plant                                                                     0                              30
------------------------------------------------------------------------------------------------------------------------------------
Corinth Tube Plant                                                                       0                              30
------------------------------------------------------------------------------------------------------------------------------------
ICPG - Corporate                                                                         0                              30
------------------------------------------------------------------------------------------------------------------------------------
Dalton Tube Plant                                                                        0                              30
------------------------------------------------------------------------------------------------------------------------------------
Danville Tube Plant                                                                      0                              30
------------------------------------------------------------------------------------------------------------------------------------
Eufaula Tube Plant                                                                       0                              30
------------------------------------------------------------------------------------------------------------------------------------
Franklin Tube Plant                                                                      0                              30
------------------------------------------------------------------------------------------------------------------------------------
Georgetown Plastics Plant                                                                0                              30
------------------------------------------------------------------------------------------------------------------------------------
Grand Rapids Tube Plant                                                                  0                              30
------------------------------------------------------------------------------------------------------------------------------------
Houston Tube Plant                                                                       0                              30
------------------------------------------------------------------------------------------------------------------------------------
Kernersville Tube Plant                                                                  0                              30
------------------------------------------------------------------------------------------------------------------------------------
Kingston Tube Plant                                                                      0                              30
------------------------------------------------------------------------------------------------------------------------------------
Lancaster Tube Plant                                                                     0                              30
------------------------------------------------------------------------------------------------------------------------------------
Linden Tube Plant                                                                        0                              30
------------------------------------------------------------------------------------------------------------------------------------
Lufkin Tube Plant                                                                        0                              30
------------------------------------------------------------------------------------------------------------------------------------
McGhee Tube Plant                                                                        0                              30
------------------------------------------------------------------------------------------------------------------------------------
Mobile Tube Plant                                                                        0                              30
------------------------------------------------------------------------------------------------------------------------------------
New Smyrna Beach Plastics Plant                                                          0                              30
------------------------------------------------------------------------------------------------------------------------------------
Palatka Tube Plant                                                                       0                              30
------------------------------------------------------------------------------------------------------------------------------------
Philadelphia Tube Plant                                                                  0                              30
------------------------------------------------------------------------------------------------------------------------------------
Phoenix Tube Plant                                                                       0                              30
------------------------------------------------------------------------------------------------------------------------------------
Rock Hill Tube Plant                                                                     0                              30
------------------------------------------------------------------------------------------------------------------------------------
Salt Lake City Tube Plant                                                                0                              30
------------------------------------------------------------------------------------------------------------------------------------
Silsbee Tube Plant                                                                       0                              30
------------------------------------------------------------------------------------------------------------------------------------
Stevens Point Composite Container Plant                                                  0                              30
------------------------------------------------------------------------------------------------------------------------------------
Taylors Tube Plant                                                                       0                              30
------------------------------------------------------------------------------------------------------------------------------------
Texarkana Tube Plant                                                                     0                              30
------------------------------------------------------------------------------------------------------------------------------------
Vacaville Tube Plant                                                                     0                              30
------------------------------------------------------------------------------------------------------------------------------------
West Monroe Tube Plant                                                                   0                              30
------------------------------------------------------------------------------------------------------------------------------------
West Point Tube Plant                                                                    0                              30
------------------------------------------------------------------------------------------------------------------------------------
Weyers Cave Tube Plant                                                                   0                              30
------------------------------------------------------------------------------------------------------------------------------------
</Table>

The effective date of eligibility for Plan participation for Employees at
certain locations is set forth below:

Carolina Converting, Inc., effective January 1, 2000;

Carolina Component Concepts, effective January 1, 2000;

Halifax Paperboard, effective May 1, 1997 (with respect to salaried and
non-union employees), and effective January 1, 2000 (with respect to bargained
employees);

Sprague Paperboard, effective May 1, 1999;

Caraustar Custom Packaging - Denver, Grand Rapids, Mentor, Salt Lake City and
St. Louis, effective July 1, 1999 (with respect to salaried employees at all
locations and also with respect to bargained employees at Salt Lake City);

Caraustar Custom Packaging - Denver, effective February 1, 2001 (with respect
to bargained employees);

Caraustar Custom Packaging - Grand Rapids, effective January 1, 2000 (with
respect to bargained employees);

Premier Boxboard Limited, LLC, effective June 27, 2000;

Pine Brook Primary Contract Packaging (formerly known as Mil Pak, Inc.),
effective July 1, 2000;

Saginaw Tube Plant (formerly known as Arrow Paper Products Company), effective
October 1, 2000 with respect to eligible salaried employees and May 1, 2001
with respect to other eligible employees;

Chicago Carton (formerly known as Crane Carton Company), effective January 1,
2001;

Industrial Packaging Division (formerly known as Smurfit Stone Container Corp.),
effective October 1, 2002 with respect to eligible salaried employees and
January 1, 2003 with respect to hourly paid employees;

Cleveland Digital Imaging Center, effective January 1, 2003 with respect to
former Vivid Graphics employees; and

Reading Paperboard, effective January 1, 2003 with respect to employees covered
by a collective bargaining agreement.

                                      A-3
<PAGE>
                                   APPENDIX B
                                     TO THE
               CARAUSTAR INDUSTRIES, INC. EMPLOYEES' SAVINGS PLAN

                    INCOME DEFERRAL CONTRIBUTION LIMITATIONS

<TABLE>
<CAPTION>
EFFECTIVE DATE                 PERCENTAGE         COMPENSATION

<S>                            <C>                <C>
January 1, 2002                   10%             $85,000 - $109,999.99
                                   8%             $110,000 - $134,999.99
                                   6%             $135,000 -

April 1, 2002                      8%             $85,000 - $134,999.99
                                   6%             $135,000 -
</TABLE>

                                        B-1
<PAGE>
               FIRST AMENDMENT TO THE CARAUSTAR INDUSTRIES, INC.
                            EMPLOYEES' SAVINGS PLAN

         Pursuant to Section 9.1 of the Caraustar Industries, Inc. Employees'
Savings Plan, as amended and restated effective January 1, 2003 (the "Plan"),
Caraustar Industries, Inc. (the "Company") does hereby amend the Plan in the
following respects:

1.       The Company wishes to provide for participation by Employees employed
at the Tacoma Tube plant; effective January 1, 2003, such individuals are
employed by an Affiliate of the Company. (Prior to January 1, 2003, the
employer was a joint venture entity in which an Affiliate of the Company owned
a 50% interest.)

         THEREFORE:

         Section 1.63(m) is added to the Plan, as set forth below.

                  (m)      If an individual was an employee of Caraustar
                  Northwest, LLC on January 1, 2003, and became an Employee on
                  January 2, 2003 as a result of the acquisition of the
                  membership interest of Caraustar Northwest, LLC by an
                  Affiliate, such Employee's Years of Service with Caraustar
                  Northwest, LLC shall be counted as Years of Service for all
                  purposes under this Plan.

         AND FURTHERMORE:

         Appendix A shall be restated in its entirety in the form attached
hereto.

2.       The Company wishes to eliminate the Plan's administrative provision
that provides for a 3-month delay in re-commencing Employee After-Tax
Contributions following an election to discontinue such contributions.

         THEREFORE:

         Section 3.2(a) of the Plan is restated in its entirety, as set forth
below.

                  (a)      General Rules. A Participant may elect to make
                  Employee After-Tax Contributions as set forth in this Section
                  by payroll deduction, and such deductions shall commence and
                  end coincident with the beginning and end of the
                  Participant's payroll period. A Participant may make Employee
                  After-Tax Contributions without making Income Deferral
                  Contributions. All such contributions shall be
                  nonforfeitable. A Participant may discontinue such payroll
                  deduction contributions at such time and in such way as the
                  Plan Administrator determines. A Participant may change the
                  amount of his Employee After-Tax

                                      1
<PAGE>
                  Contributions being made by him by regular payroll deductions
                  at such time and in such way as the Plan Administrator
                  determines. In the event that a Participant makes a hardship
                  withdrawal under Section 5.5, the suspension provisions of
                  Section 3.1(a)(iii) shall apply.

         This Amendment is effective as of January 1, 2003.

         IN WITNESS WHEREOF, Caraustar Industries, Inc. has caused this
Amendment to be executed by its officers, this 7th day of February, 2003.

                                    CARAUSTAR INDUSTRIES, INC.

                                    By: /s/ Barry A. Smedstad
                                       ----------------------------------------
                                        Barry A. Smedstad

                                    Title: Vice President, Human Resources

ATTEST:

/s/ Marinan R. Mays
--------------------------------
Marinan R. Mays

Title:  Corporate Secretary

                                       2
<PAGE>
                                   APPENDIX A
                                     TO THE
               CARAUSTAR INDUSTRIES, INC. EMPLOYEES' SAVINGS PLAN

             PERIOD OF ELIGIBILITY SERVICE REQUIRED FOR ELIGIBILITY
                          TO PARTICIPATE IN THE PLAN

<TABLE>
<CAPTION>
                                                                    SALARIED EMPLOYEES             HOURLY EMPLOYEES
                                                                          (DAYS)                        (DAYS)

<S>                                                                 <C>                            <C>
Caraustar Corporate Headquarters                                            0                            N/A

MILL GROUP
Austell Box Board                                                           0                             30
Sweetwater Paper Board                                                      0                             30
Camden Paperboard (closed)                                                  0                             30
Buffalo Paperboard                                                          0                        0 Non Union
                                                                                                      120 Union
Chicago Paperboard (closed)                                                 0                             90
Chattanooga Paperboard                                                      0                             90
Cincinnati Paperboard                                                       0                             90
Carotell Paper Board                                                        0                             30
Reading Paperboard                                                          0                             60
Carolina Paper Board                                                        0                             60
Richmond Paperboard                                                         0                             90
Rittman Paperboard                                                          0                             45
Tama Paperboard                                                             0                             30
Chesapeake Paperboard (closed)                                              0                             60
Halifax Mill                                                                0                             90
Halifax-Richmond Converting (closed)                                        0                             90
Sprague Paperboard                                                          0                             90
Carolina Component Concepts                                                 0                             90
Premier Boxboard Limited                                                    0                             90
Carolina Converting, Inc.                                                   0                             90
Paradigm Chemical & Consultant                                              0                            N/A
Cedartown Paperboard (Smurfit)                                              0                             60
Lafayette Paperboard (Smurfit)                                              0                 First of month after hire
                                                                                                         date
</TABLE>

                                      A-1
<PAGE>
<TABLE>
<CAPTION>
                                                                    SALARIED EMPLOYEES             HOURLY EMPLOYEES
                                                                          (DAYS)                        (DAYS)

<S>                                                                 <C>                            <C>
(MILL GROUP CONT.)
Tacoma Paperboard - PACE Local #8-0279 (Smurfit)                            0                 First of month after hire
                                                                                                         date
Covington Partition (Smurfit)                                               0                First of month after 90 days
Frenchtown NJ Partition (formerly referred to as                            0                First of month after 90 days
"Flemington") (Smurfit)
Litchfield Partition (Smurfit)                                              0                First of month after 90 days
CUSTOM PACKAGING GROUP
Randleman Carton (Mid-State Paper Box Co.)                                  0                             30
Charlotte Carton (Atlantic Coast Carton Co.)                                0                             30
Archdale Carton (Packrite Packaging, Inc.) (closed merged                   0                             30
with Randleman)
Burlington Rigid Box (Carolina Paper Box Co., Inc.)                         0                             30
Kingston Springs Carton (Mid Packaging Group - Tennessee)                   0                             30
Ashland (Garber Company)                                                    0                             60
Special Packaging - Bucyrus, Robersonville, Strasburg                       0                             60
Clifton Primary Contract Pkg. (General Packaging Services -                 0                 60 - Non Union Bargained -
Clifton)                                                                                              Ineligible
Montvale Design Services (Oak Tree Packaging)                               0                             45
Palmer Carton Plant (Oak Tree Packaging)                                    0                             45
Versailles Carton Plant (Oak Tree Packaging)                                0                             45
York Carton Plant (Oak Tree Packaging)                                      0                             45
Hunt Valley (Chesapeake Fiber)                                              0                        Not Eligible
Birmingham Carton (Boxall Inc.)                                             0                             30
CCP Packaging - Midwest - Denver L-435 (Tenneco Carton)                     0                             60
CCP - Midwest - Grand Rapids L-555-S (Tenneco Carton)                       0                             60
CCP - Midwest - Mentor L-546 (Tenneco Carton)                               0                        Not Eligible
</TABLE>

                                      A-2
<PAGE>
<TABLE>
<CAPTION>
                                                                    SALARIED EMPLOYEES             HOURLY EMPLOYEES
                                                                          (DAYS)                        (DAYS)

<S>                                                                 <C>                            <C>
(CUSTOM PACKAGING GROUP CONT.)
CCP - Midwest - Salt Lake GCU2 (closed) (Tenneco Carton)                    0                             30
CCP - Midwest - St. Louis L-6M (Tenneco Carton)                             0                        Not Eligible
CCP - Midwest - Salaried (Tenneco Carton)                                   0                            N/A
Pine Brook (MilPak)                                                         0                             30
Chicago Carton (Crane)                                                      0                             90
Cleveland Digital Imaging Center                                            0                             30
RECOVERED FIBER GROUP
Doraville Recycling Plant                                                   0                             30
Charlotte Recycling Plant                                                   0                             30
Columbus Recycling Plant                                                    0                             30
Macon Recycling Plant (closed)                                              0                             30
Dalton Recycling Plant                                                      0                             30
Cleveland Recycling Plant L-244 (Cleveland Paper Stock Corp.)               0                             30
Texarkana Recycling Plant                                                   0                             30
Caraustar Paper Sales North (Caraustar Paperboard)                          0                            N/A
Caraustar Paper Sales South                                                 0                            N/A
Hardeeville/Port Recycling Plant (Etowah)                                   0                             30
Etowah/Canton (closed)                                                      0                             30
Halifax Recycling (closed)                                                  0                             30
INDUSTRIAL & CONSUMER PRODUCTS GROUP
ICPG Arrow Saginaw Bargained                                                0                             60
ICPG Minerva L-7243-51                                                      0                             60
ICPG Minerva Team L92                                                       0                             60
ICPG Perrysburg L7243                                                       0                             60
ICPG/Federal Pkg. Non Union (includes New Smyrna Beach)                     0                             30
ICPG Orrville L-150 (Federal Packaging)                                     0                             30
</TABLE>

                                      A-3
<PAGE>
<TABLE>
<CAPTION>
                                                                    SALARIED EMPLOYEES             HOURLY EMPLOYEES
                                                                          (DAYS)                        (DAYS)

<S>                                                                 <C>                            <C>
(INDUSTRIAL & CONSUMER PRODUCTS GROUP CONT.)
ICPG St. Paris L-1467 (Federal Packaging)                                   0                             30
Beardstown Tube - SEIU (Smurfit)                                            0                             60
Cedartown Tube - UNITE Local #2423B (Smurfit)                               0                             60
Columbus Tube - UIW (Smurfit)                                               0                             60
Crossett Tube - PACE Local #796 (Smurfit)                                   0                             60
DeQuincy Tube - UNITE (Smurfit)                                             0                             60
Hendersonville Tube - UNITE Local #1752 (Smurfit)                           0                             60
Jacksonville Tube - UNITE Local #360 (Smurfit)                              0                             60
Mobile Tube - UNITE (Smurfit)                                               0                             60
Saginaw Tube - IBT Teamsters (Smurfit)                                      0                             60
Altavista Tube Plant                                                        0                             30
Amarillo Tube Plant                                                         0                             30
Arlington Tube Plant                                                        0                             30
Austell Tube Plant                                                          0                             30
Cantonment Tube Plant                                                       0                             30
Caraustar Adhesives                                                         0                             30
Cedar Springs Tube Plant                                                    0                             30
Corinth Tube Plant                                                          0                             30
ICPG - Corporate                                                            0                             30
Dalton Tube Plant                                                           0                             30
Danville Tube Plant                                                         0                             30
Eufaula Tube Plant (Smurfit)                                                0                             30
Franklin Tube Plant (Smurfit)                                               0                             30
Georgetown Plastics Plant (Federal Packaging)                               0                             30
Grand Rapids Tube Plant (Smurfit)                                           0                             30
Houston Tube Plant (Smurfit)                                                0                             30
</TABLE>

                                      A-4
<PAGE>
<TABLE>
<CAPTION>
                                                                    SALARIED EMPLOYEES             HOURLY EMPLOYEES
                                                                          (DAYS)                        (DAYS)

<S>                                                                 <C>                            <C>
(INDUSTRIAL & CONSUMER PRODUCTS GROUP CONT.)
Kernersville Tube Plant                                                     0                             30
Kingston Tube Plant (Smurfit; Ontario)                                 Not Eligible                  Not Eligible
Lancaster Tube Plant                                                        0                             30
Linden Tube Plant                                                           0                             30
Lufkin Tube Plant (Smurfit)                                                 0                             30
McGhee Tube Plant                                                           0                             30
Mobile Tube Plant                                                           0                             30
New Smyrna Beach Plastics Plant                                             0                             30
Palatka Tube Plant                                                          0                             30
Philadelphia Tube Plant (closed 12/31/02) (Smurfit)                         0                             30
Phoenix Tube Plant                                                          0                             30
Rock Hill Tube Plant                                                        0                             30
Salt Lake City Tube Plant                                                   0                             30
Silsbee Tube Plant                                                          0                             30
Stevens Point Composite Container Plant                                     0                             30
Tacoma Tube Plant (Paccess/Caraustar Northwest LLC)                         0                             30
Taylors Tube Plant                                                          0                             30
Texarkana Tube Plant                                                        0                             30
Vacaville Tube Plant (Smurfit)                                              0                             30
West Monroe Tube Plant                                                      0                             30
West Point Tube Plant                                                       0                             30
Weyers Cave Tube Plant                                                      0                             30
</TABLE>

The effective date of eligibility for Plan participation for Employees at
certain locations is set forth below:

Carolina Converting, Inc., effective January 1, 2000;

Carolina Component Concepts, effective January 1, 2000;

                                      A-5
<PAGE>
Halifax Paperboard, effective May 1, 1997 (with respect to salaried and
non-union employees), and effective January 1, 2000 (with respect to bargained
employees);

Sprague Paperboard, effective May 1, 1999;

Caraustar Custom Packaging - Denver, Grand Rapids, Mentor, Salt Lake City and
St. Louis, effective July 1, 1999 (with respect to salaried employees at all
locations and also with respect to bargained employees at Salt Lake City);

Caraustar Custom Packaging - Denver, effective February 1, 2001 (with respect
to bargained employees);

Caraustar Custom Packaging - Grand Rapids, effective January 1, 2000 (with
respect to bargained employees);

Premier Boxboard Limited, LLC, effective June 27, 2000;

Pine Brook Primary Contract Packaging (formerly known as Mil Pak, Inc.),
effective July 1, 2000;

Saginaw Tube Plant (formerly known as Arrow Paper Products Company), effective
October 1, 2000 with respect to eligible salaried employees and May 1, 2001
with respect to other eligible employees;

Chicago Carton (formerly known as Crane Carton Company), effective January 1,
2001;

Industrial Packaging Division (formerly known as Smurfit Stone Container
Corp.), effective October 1, 2002 with respect to eligible salaried employees
and January 1, 2003 with respect to hourly paid employees;

Cleveland Digital Imaging Center, effective January 1, 2003 with respect to
former Vivid Graphics employees;

Reading Paperboard, effective January 1, 2003 with respect to employees covered
by a collective bargaining agreement; and

Tacoma Tube Plant (formerly known as Caraustar Northwest, LLC), effective
January 1, 2003.

                                      A-6
<PAGE>
               SECOND AMENDMENT TO THE CARAUSTAR INDUSTRIES, INC.
                            EMPLOYEES' SAVINGS PLAN

         Pursuant to Section 9.1 of the Caraustar Industries, Inc. Employees'
Savings Plan, as amended and restated effective January 1, 2003 (the "Plan"),
Caraustar Industries, Inc. (the "Company") does hereby amend the Plan in the
following respects:

         The Company wishes to provide that a newly created entity, Paradigm
Chemical & Consulting, LLC, a Georgia limited liability company ("Paradigm"),
shall be an Employer under the Plan. Paradigm's sole member is Caraustar Mill
Group, Inc. The employees that will initially be transferred to Paradigm have
been employed by Caraustar Mill Group, Inc. Such employees have been
participating, and shall continue to participate, in the Plan under the
provisions of the Plan applicable to employees of Caraustar Mill Group, Inc.
employed at the Paradigm location.

         THEREFORE:

         Section 1.21 of the Plan is amended and restated in its entirety, as
follows:

         1.21     Employer. The Company, and any entity executing this Plan
document or otherwise adopting this Plan in writing as provided in Section 11.1.
The following are Employers under the Plan:

         (a)      Caraustar Industries, Inc.;
         (b)      Caraustar Custom Packaging Group, Inc.;
         (c)      Caraustar Recovered Fiber Group, Inc.;
         (d)      Caraustar Industrial and Consumer Products Group, Inc.;
         (e)      Caraustar Mill Group, Inc.;
         (f)      Caraustar Custom Packaging Group (Maryland), Inc.;
         (g)      Chicago Paperboard Corporation;
         (h)      Sprague Paperboard, Inc.;
         (i)      Halifax Paperboard Company, Inc.;
         (j)      Premier Boxboard Limited, LLC; and
         (k)      Paradigm Chemical & Consulting, LLC.

                             [SIGNATURES ATTACHED]

                                       1
<PAGE>
         This Amendment is effective as of April 1, 2003.

         For reference, and pursuant to Section 11.I of the Plan, the
resolution of the Caraustar Industries, Inc. Board of Directors is attached
hereto as Appendix A, the resolution of Paradigm's sole member is attached
hereto as Appendix B, and a Joinder Agreement is attached hereto as Appendix C.

         IN WITNESS WHEREOF, Caraustar Industries, Inc. has caused this
Amendment to be executed by its officers, this 21st day of March, 2003.

                                    CARAUSTAR INDUSTRIES, INC.

[SEAL]                              By: /s/ Barry A. Smedstad
                                        ----------------------------------
                                        Barry A. Smedstad
                                 Title: Vice President, Human Resources

ATTEST:

/s/ Marinan R. Mays
--------------------------
Marinan R. Mays

Title: Corporate Secretary

                                      2
<PAGE>
                                                                      APPENDIX A

                               RESOLUTIONS OF THE
                               BOARD OF DIRECTORS
                                       OF
                           CARAUSTAR INDUSTRIES, INC.

                              May 7, 2003 Meeting

         WHEREAS, Caraustar Industries, Inc., as Plan Administrator of the
Caraustar Industries, Inc., Employees Savings Plan (the "Savings Plan"), has
determined that Paradigm Chemical & Consulting, LLC, a Georgia limited liability
company, should be permitted to become an Employer under the Savings Plan; and

         WHEREAS, Caraustar Industries, Inc., as Plan Administrator of the
Caraustar Industries, Inc. Retirement Plan (the "Pension Plan"), has determined
that Paradigm Chemical & Consulting, LLC, a Georgia limited liability company,
should be permitted to become an Employer under the Pension Plan; and

         WHEREAS, under the terms of both the Savings Plan and Pension Plan,
the addition of an Employer requires the approval of this Board.

         NOW, THEREFORE, BE IT

         RESOLVED, that the addition of Paradigm Chemical & Consulting, LLC, as
an Employer under the Savings Plan be, and it hereby is, approved; and

         RESOLVED FURTHER, that the addition of Paradigm Chemical & Consulting,
LLC, as an Employer under the Pension Plan be, and it hereby is, approved; and

         RESOLVED FURTHER, that the proper officers of Caraustar Industries,
Inc. be, and they hereby are, authorized and directed to take whatever action
may be necessary or convenient to carry out the foregoing resolutions.
<PAGE>
                                                                    APPENDIX B

                          RESOLUTION OF SOLE MEMBER
                                      OF
                     PARADIGM CHEMICAL & CONSULTING, LLC

The sole member of Paradigm Chemical & Consulting, LLC ("Paradigm"), hereby
resolves as follows:

         RESOLVED, that Paradigm shall become an Employer under the Caraustar
Industries, Inc. Employees' Savings Plan, pursuant to the terms of that certain
Joinder Agreement made effective as of April 1, 2003; and

         RESOLVED FURTHER, that Paradigm shall become an Employer under the
Caraustar Industries, Inc. Retirement Plan, pursuant to the terms of that
certain Adoption Agreement made effective as of April 1, 2003; and

         RESOLVED FURTHER, that the proper officers of Paradigm be, and they
hereby are, authorized and directed to take whatever action may be necessary or
convenient to carry out the foregoing resolutions.

         These resolutions are adopted this, the 21st day of March, 2003.

CARAUSTAR MILL GROUP, INC.
   as sole Member

By:    /s/ Ronald J. Domanico
   ----------------------------
Name:  Ronald J. Domanico
     --------------------------
Title: Vice President
      -------------------------
<PAGE>
                                                                    APPENDIX C

              CARAUSTAR INDUSTRIES, INC. EMPLOYEES' SAVINGS PLAN
                              JOINDER AGREEMENT

         THIS JOINDER AGREEMENT (this "Joinder Agreement") is made effective as
of April 1, 2003, by Paradigm Chemical & Consulting, LLC, a Georgia limited
liability company (the "New Employer"), and accepted by Caraustar Industries,
Inc. (the "Plan Administrator"). Reference is made to the Caraustar Industries,
Inc. Employees' Savings Plan, as amended and restated January 1, 2001 (as
amended, modified, supplemented or restated from time to time, the "Plan").
Unless otherwise defined herein, terms defined in the Plan are used herein with
the same meaning.

         The New Employer hereby agrees as follows:

         1.       JOINDER AGREEMENT. Subject to the terms and conditions hereof
and of the Plan, the New Employer hereby agrees to become an Employer under the
Plan, and to be bound by the terms of the Plan.

         2.       NEW EMPLOYER REPRESENTATIONS. The New Employer confirms that
it has received a copy of the Plan, together with copies of such other
documents and information as it has deemed appropriate to decide to enter into
this Joinder Agreement.

         3.       COUNTERPARTS. This Joinder Agreement may be executed in any
number of counterparts and by different parties hereto on separate
counterparts, each of which, when so executed and delivered, shall be an
original, but all of which together constitute one and the same instrument.

                        [SIGNATURES ON FOLLOWING PAGE]
<PAGE>
         IN WITNESS WHEREOF, the parties have caused this Joinder Agreement to
be executed by their duly authorized officers, to be effective as of the date
first above written.

                                            PARADIGM CHEMICAL & CONSULTING, LLC

                                            By:      CARAUSTAR MILL GROUP, INC.,
                                                     as sole Member

                                            By:     /s/ Ronald J. Domanico
                                                    ----------------------------

                                            Name:   Ronald J. Domanico
                                                    ----------------------------

                                            Title:  Vice President
                                                    ----------------------------

Accepted this 21 day of
March, 2003:

CARAUSTAR INDUSTRIES, INC., as Plan Administrator

By:     /s/ Barry A. Smedstad
        -------------------------------

Name:   Barry A. Smedstad
        -------------------------------

Title:  Vice President, Human Resources
        -------------------------------

                                       2
<PAGE>

               EGTRRA AMENDMENT TO THE CARAUSTAR INDUSTRIES, INC.
                            EMPLOYEES' SAVINGS PLAN

                                    PREAMBLE

1.       ADOPTION AND EFFECTIVE DATE OF AMENDMENT. This is an amendment of the
Caraustar Industries, Inc. Employees' Savings Plan, as amended and restated
effective January 1, 2002 (the "Plan"), adopted hereby to reflect certain
provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001
("EGTRRA"). This amendment is intended as good faith compliance with the
requirements of EGTRRA and is to be construed in accordance with EGTRRA and
guidance issued thereunder. Except as otherwise provided, this amendment shall
be effective as of the first day of the first plan year beginning after December
31, 2001.

2.       SUPERSESSION OF INCONSISTENT PROVISIONS AND INTERPRETATION. This
amendment shall supersede the provisions of the Plan to the extent those
provisions are inconsistent with the provisions of this amendment. Certain of
the terms used in this amendment document may be somewhat inconsistent with the
terms otherwise used in the Plan. Any such inconsistencies shall be reconciled
by reasonably interpreting such terms in a manner consistent with their purposes
under the Internal Revenue Code ("Code") or other applicable law. Such
inconsistencies may include, for example (and without limitation or other
implication), whether the term begins with a capital letter.

SECTION 1. IRC ss.415 LIMITATIONS ON CONTRIBUTIONS

1.       EFFECTIVE DATE. This section shall be effective for Limitation Years
         beginning after December 31, 2001.

2.       MAXIMUM ANNUAL ADDITION. Except to the extent permitted under section 9
         of this amendment and section 414(v) of the Code, if applicable, the
         annual addition that may be contributed or allocated to a Participant's
         account under the plan for any limitation year shall not exceed the
         lesser of:

         (a)      $40,000, as adjusted for increases in the cost-of-living under
                  section 415(d) of the Code, or

         (b)      100 percent of the Participant's compensation, within the
                  meaning of section 415(c)(3) of the Code, for the limitation
                  year.

The compensation limit referred to in (b) shall, not apply to any contribution
for medical benefits after separation from service (within the meaning of
section 401(h) or section 419A(f)(2) of the Code) which is otherwise treated as
an annual addition.

<PAGE>

SECTION 2. INCREASE IN IRC ss.401(a)(17) COMPENSATION LIMIT

The annual Compensation of each Participant taken into account in determining
allocations for any plan year beginning after December 31, 2001, shall not
exceed $200,000, as adjusted for cost-of-living increases in accordance with
section 401(a)(17)(B) of the Code. Annual Compensation means Compensation during
the plan year or such other consecutive 12-month period over which Compensation
is otherwise determined under the Plan (the determination period). The
cost-of-living adjustment in effect for a calendar year applies to annual
compensation for the determination period that begins with or within such
calendar year.

SECTION 3. MODIFICATION OF TOP-HEAVY RULES

1.       EFFECTIVE DATE. This section shall apply for purposes of determining
         whether the Plan is a top-heavy plan under section 416(g) of the Code
         for Plan Years beginning after December 31, 2001, and whether the Plan
         satisfies the minimum benefits requirements of section 416(c) of the
         Code for such years. This section amends the sections of the Plan that
         include the top-heavy rules required by section 416 of the Code,
         including, without limitation, Article X of the Plan.

2.       DETERMINATION OF TOP-HEAVY STATUS

         2.1      KEY EMPLOYEE. Key employee means any employee or former
                  employee (including any deceased employee) who at any time
                  during the Plan Year that includes the determination date was
                  an officer of the employer having annual compensation greater
                  than $130,000 (as adjusted under section 416(i)(l) of the Code
                  for Plan Years beginning after December 31, 2002), a 5-percent
                  owner of the employer, or a 1-percent owner of the employer
                  having annual compensation of more than $150,000. For this
                  purpose, annual compensation means compensation within the
                  meaning of section 415(c)(3) of the Code. The determination of
                  who is a key employee will be made in accordance with section
                  416(i)(l) of the Code and the applicable regulations and other
                  guidance of general applicability issued thereunder.

         2.2      DETERMINATION OF PRESENT VALUES AND AMOUNTS. This section 2.2
                  shall apply for purposes of determining the present values of
                  accrued benefits and the amounts of account balances of
                  employees as of the determination date.

                  2.2.1    DISTRIBUTIONS DURING YEAR ENDING ON THE DETERMINATION
                           DATE. The present values of accrued benefits and the
                           amounts of account balances of an employee as of the
                           determination date shall be increased by the
                           distributions made with respect to the employee under
                           the Plan and any plan aggregated with the Plan under
                           section 416(g)(2) of the Code during the 1-year
                           period ending on the determination date. The
                           preceding sentence shall also apply to distributions
                           under a terminated plan which, had it not been
                           terminated, would have been aggregated with the Plan
                           under section 416(g)(2)(A)(i) of the Code. In the
                           case of a distribution made for a reason other than
                           separation from service, death, or disability,

                                        2
<PAGE>

                           this provision shall be applied by substituting
                           "5-year period" for "1-year period."

                  2.2.2    EMPLOYEES NOT PERFORMING SERVICES DURING YEAR ENDING
                           ON THE DETERMINATION DATE. The accrued benefits and
                           accounts of any individual who has not performed
                           services for the employer during the 1-year period
                           ending on the determination date shall not be taken
                           into account.

3.       MINIMUM BENEFITS

         3.1      MATCHING CONTRIBUTIONS. Employer matching contributions shall
                  be taken into account for purposes of satisfying the minimum
                  contribution requirements of section 416(c)(2) of the Code and
                  the Plan. The preceding sentence shall apply with respect to
                  matching contributions under the Plan. Employer matching
                  contributions that are used to satisfy the minimum
                  contribution requirements shall be treated as matching
                  contributions for purposes of the actual contribution
                  percentage test and other requirements of section 401(m) of
                  the Code.

SECTION 4. DIRECT ROLLOVERS OF PLAN DISTRIBUTIONS

1.       EFFECTIVE DATE. This section shall apply to distributions made after
         December 31, 2001.

2.       MODIFICATION OF DEFINITION OF ELIGIBLE RETIREMENT PLAN. For purposes of
         the direct rollover provisions in Section 5.8 of the Plan, an eligible
         retirement plan shall also mean an annuity contract described in
         section 403(b) of the Code and an eligible plan under section 457(b) of
         the Code which is maintained by a state, political subdivision of a
         state, or any agency or instrumentality of a state or political
         subdivision of a state and which agrees to separately account for
         amounts transferred into such plan from this Plan. The definition of
         eligible retirement plan shall also apply in the case of a distribution
         to a surviving spouse, or to a spouse or former spouse who is the
         alternate payee under a qualified domestic relation order, as defined
         in section 414(p) of the Code.

3.       MODIFICATION OF DEFINITION OF ELIGIBLE ROLLOVER DISTRIBUTION TO EXCLUDE
         HARDSHIP DISTRIBUTIONS. For purposes of the direct rollover provisions
         in Section 5.8 of the Plan, any amount that is distributed on account
         of hardship shall not be an eligible rollover distribution and the
         distributee may not elect to have any portion of such a distribution
         paid directly to an eligible retirement plan. (This paragraph 3 is not
         intended to imply that a Participant has an unlimited right to take
         hardship distributions from the Plan.)

4        MODIFICATION OF DEFINITION OF ELIGIBLE ROLLOVER DISTRIBUTION TO INCLUDE
         AFTER-TAX EMPLOYEE CONTRIBUTIONS. For purposes of the direct rollover
         provisions in section 5.8 of the Plan, a portion of a distribution
         shall not fail to be an eligible rollover distribution merely because
         the portion consists of after-tax employee contributions that are not
         includible in gross income. However, such portion may be transferred
         only to an individual retirement account or annuity described in
         section 408(a) or (b) of the Code, or to a qualified defined
         contribution plan described in section 401(a) or 403(a) of the Code
         that agrees to separately account for amounts so transferred, including
         separately

                                        3
<PAGE>
         accounting for the portion of such distribution which is includible in
         gross income and the portion of such distribution which is not so
         includible.

SECTION 5. ROLLOVERS FROM OTHER PLANS

Beginning on July 1, 2002, the Plan will accept Participant indirect rollover
contributions and/or direct rollovers of distributions made after December 31,
2001, from the following types of plans: (i) direct or indirect Participant
rollovers from a qualified plan described in section 401(a) or 403(a) of the
Code, an annuity contract described in section 403(b) of the Code, and an
eligible plan under section 457(b) of the Code which is maintained by a state,
political subdivision of a state, or any agency or instrumentality of a state
or political subdivision of a state; and (ii) indirect Participant rollovers
from an individual retirement account or annuity described in section 408(a) or
408(b) of the Code that is eligible to be rolled over.

Beginning July 1, 2002, the Plan will accept indirect rollover contributions
and/or direct rollovers of distributions attributable to an employee made after
December 31, 2001 by or with respect to spouses who are Participants (or who
are otherwise permitted to make rollover contributions to the Plan under
Section 3.4) to the full extent permitted by section 402(c)(9) of the Code.

Rollover contributions of after-tax contributions shall be permitted effective
April 1, 2002, and must be separately accounted for as required by law and
regulation.

This section 5 amends Section 3.4 of the Plan.

SECTION 6. ROLLOVERS DISREGARDED IN INVOLUNTARY CASH-OUTS

1.       APPLICABILITY AND EFFECTIVE DATE. This section shall apply beginning
         January 1, 2002, with respect to Participants who sever or separate
         from service before January 1, 2002 or after December 31, 2001.

2.       ROLLOVERS DISREGARDED IN DETERMINING VALUE OF ACCOUNT BALANCE FOR
         INVOLUNTARY DISTRIBUTIONS. For purposes of Sections 5.2(a) and 5.2(b)
         of the Plan, the value of a Participant's nonforfeitable account
         balance shall be determined without regard to that portion of the
         account balance that is attributable to rollover contributions (and
         earnings allocable thereto) within the meaning of sections 402(c),
         403(a)(4), 403(b)(8), 408(d)(3)(A)(ii), and 457(e)(16) of the Code. If
         the value of the Participant's nonforfeitable account balance as so
         determined is $5,000 or less, the plan shall immediately distribute
         the Participant's entire nonforfeitable account balance.

SECTION 7. REPEAL OF MULTIPLE USE TEST

The multiple use test described in Treasury Regulation section 1.401(m)-2 and
Sections 3.11 and 3.12 of the Plan shall not apply for plan years beginning
after December 31, 2001.

                                       4
<PAGE>

SECTION 8. ELECTIVE DEFERRALS - CONTRIBUTION LIMITATION

No Participant shall be permitted to have elective deferrals made under this
Plan, or any other qualified plan maintained by the employer during any taxable
year, in excess of the dollar limitation contained in section 402(g) of the
Code in effect for such taxable year, except to the extent permitted under
section 9 of this amendment and section 414(v) of the Code, if applicable.

SECTION 9. CATCH-UP CONTRIBUTIONS

All employees who are eligible to make elective deferrals under this Plan and
who have attained age 50 before the close of the Plan Year shall be eligible to
make catch-up contributions in accordance with, and subject to the limitations
of, section 414(v) of the Code. Such catch-up contributions shall not be taken
into account for purposes of the provisions of the Plan implementing the
required limitations of sections 402(g) and 415 of the Code. The Plan shall not
be treated as failing to satisfy the provisions of the plan implementing the
requirements of section 401(k)(3), 401(k)(11), 401(k)(12), 410(b), or 416 of
the Code, as applicable, by reason of the making of such catch-up
contributions. Catch-up contributions may be made without regard to any limits
imposed by the Plan or the Administrator on the maximum percentage of
Compensation or amount that may otherwise be made as elective deferrals.
Catch-up contributions shall be disregarded in determining the amount of
matching contributions allocated to a Participant's account. Catch-up
contributions shall be made pursuant to such reasonable and nondiscriminatory
procedures as may be adopted by the Administrator.

SECTION 10. SUSPENSION PERIOD AND DEFERRAL LIMITATION FOLLOWING HARDSHIP
DISTRIBUTION

A Participant who receives a distribution of elective deferrals after December
31, 2001, on account of hardship shall be prohibited from making elective
deferrals and employee contributions under this and all other plans of the
employer for 6 months after receipt of the distribution. A Participant who
receives a distribution of elective deferrals in calendar year 2001 on account
of hardship shall be prohibited from making elective deferrals and employee
contributions under this and all other plans of the employer for 12 months
after receipt of the hardship distribution.

The elective deferrals of a Participant who receives a distribution of elective
deferrals on account of hardship after December 31, 2001, shall not, in the
calendar year following such hardship withdrawal, be limited to the amount of
elective deferrals permitted under Code Section 402(g) for such calendar year
minus the amount of elective deferrals made in the calendar year of the
hardship withdrawal.

This section 10 amends Sections 3.1(a)(iii) and 5.5(d)(iii) and (iv) of the
Plan.

SECTION 11. DISTRIBUTION UPON SEVERANCE FROM EMPLOYMENT

1.       EFFECTIVE DATE. This section shall apply, beginning January 1, 2002
         for distributions and severances regardless of when the severance from
         employment occurred.

                                       5
<PAGE>

2.       NEW DISTRIBUTABLE EVENT. A Participant's elective deferrals, qualified
         nonelective contributions, qualified matching contributions, and
         earnings attributable to these contributions, and any other amounts
         allocated to the Participant's account under the Plan, shall be
         distributable on account of the Participant's severance from
         employment. However, such a distribution shall be subject to the other
         provisions of the Plan regarding distributions, other than provisions
         that require a separation from service before such amounts may be
         distributed.

         This EGTRRA amendment has been signed on behalf of Caraustar
Industries, Inc., as authorized by the Board of Directors of Caraustar
Industries, Inc.

        Date: April 26, 2002

                                     CARAUSTAR INDUSTRIES, INC.

                                     By: /s/ Barry A. Smedstad
                                        ---------------------------------------
                                     Name: Barry A. Smedstad
                                          -------------------------------------
                                            Vice President - Human Resources

By: /s/ Marinan R. Mays
   ----------------------------
Name: Marinan R. Mays
     --------------------------
      Corporate Secretary

                                       6
<PAGE>

                                TRUST AGREEMENT

                                    Between

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

                           CARAUSTAR INDUSTRIES, INC.

                                      And

                       FIDELITY MANAGEMENT TRUST COMPANY

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

               CARAUSTAR INDUSTRIES, INC. EMPLOYEES' SAVINGS PLAN

                                     TRUST

                          Dated as of October 1, 1999

<PAGE>

                               TABLE OF CONTENTS
                               -----------------

<TABLE>
<CAPTION>

SECTION                                                                                           PAGE
-------                                                                                           ----
<S>     <C>                                                                                       <C>

1       TRUST.......................................................................................2

2       EXCLUSIVE BENEFIT AND REVERSION OF SPONSOR CONTRIBUTIONS....................................2

3       DISBURSEMENTS...............................................................................2
        (a) Administrator Directed Disbursements
        (b) Participant Withdrawal Requests
        (c) Limitations

4       INVESTMENT OF TRUST.........................................................................3
        (a) Selection of Investment Options
        (b) Available Investment Options
        (c) Participant Direction
        (d) Mutual Funds
        (e) Sponsor Stock
        (f) Participant Loans
        (g) Participant Loans for the Purchase of a Primary Residence
        (h) Reliance of Trustee on Directions
        (i) Trustee Powers

5       RECORDKEEPING AND ADMINISTRATIVE SERVICES TO BE PERFORMED..................................13
        (a) General
        (b) Accounts
        (c) Inspection and Audit
        (d) Effect of Plan Amendment
        (e) Returns, Reports and Information

6       COMPENSATION AND EXPENSES..................................................................15

7       DIRECTIONS AND INDEMNIFICATION.............................................................15
        (a) Identity of Administrator and Named Fiduciary
        (b) Directions from Administrator
        (c) Directions from Named Fiduciary
        (d) Co-Fiduciary Liability
        (e) Indemnification
        (f) Survival
</TABLE>

                                      -i-
<PAGE>

                               TABLE OF CONTENTS
                               -----------------
                                  (Continued)

<TABLE>
<CAPTION>
SECTION                                                                                           PAGE
-------                                                                                           ----
<S>     <C>                                                                                       <C>

8       RESIGNATION OR REMOVAL OF TRUSTEE...........................................................17
        (a) Resignation
        (b) Removal

9       SUCCESSOR TRUSTEE...........................................................................17
        (a) Appointment
        (b) Acceptance
        (c) Corporate Action

10      TERMINATION.................................................................................18

11      RESIGNATION, REMOVAL, AND TERMINATION NOTICES...............................................18

12      DURATION....................................................................................18

13      AMENDMENT OR MODIFICATION...................................................................18

14      ELECTRONIC SERVICES.........................................................................18

15      GENERAL.....................................................................................19
        (a) Performance by Trustee, its Agents or Affiliates
        (b) Entire Agreement
        (c) Waiver
        (d) Successors and Assigns
        (e) Partial Invalidity
        (f) Section Headings

16      GOVERNING LAW...............................................................................20
        (a) Massachusetts Law Controls
        (b) Trust Agreement Controls
</TABLE>

SCHEDULES
   A.   Administrative Services
   B.   Fee Schedule
   C.   Investment Options
   D.   Administrator's Authorization Letter
   E.   Named Fiduciary's Authorization Letter
   F.   IRS Determination Letter or Opinion of Counsel
   G.   Exchange Guidelines
   H.   Operational Guidelines for Non-Fidelity Mutual Funds

                                      -ii-

<PAGE>

         TRUST AGREEMENT, dated as of the first day of October, 1999, between
CARAUSTAR INDUSTRIES, INC. a North Carolina corporation, having an office at
3100 Washington Street, Austell, Georgia 30106 (the "Sponsor"), and FIDELITY
MANAGEMENT TRUST COMPANY, a Massachusetts trust company, having an office at 82
Devonshire Street, Boston, Massachusetts 02109 (the "Trustee").

                                  WITNESSETH:

         WHEREAS, the Sponsor is the sponsor of the Caraustar Industries, Inc.
Employees' Savings Plan (the "Plan"); and

         WHEREAS, the Sponsor wishes to establish a trust to hold and invest
Plan assets under the Plan for the exclusive benefit of participants in the
Plan and their beneficiaries; and

         WHEREAS, the Sponsor (the "Named Fiduciary") is the named fiduciary of
the Plan (within the meaning of section 402(a) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA")); and

         WHEREAS, the Trustee is willing to hold and invest the aforesaid Plan
assets in trust among several investment options selected by the Named
Fiduciary; and

         WHEREAS, the Sponsor wishes to have the Trustee perform certain
ministerial recordkeeping and administrative functions under the Plan; and

         WHEREAS, Sponsor (the "Administrator") is the administrator of the
Plan (within the meaning of section 3(16)(A) of ERISA); and

         WHEREAS, the Trustee is willing to perform services that are
ministerial in nature and which shall be performed within the framework of
policies, interpretations, rules, practices, and procedures made or established
by the Sponsor. Hence, it is not intended that the Trustee will exercise any

<PAGE>

discretionary authority or discretionary control with respect to the management
or disposition of the assets of the Plan, or render investment advice for a fee
or compensation, either directly or indirectly, with respect to any monies or
other property of the Plan and/or Trust. Notwithstanding any provision to the
contrary in the Agreement, the Trustee acknowledges that, under ERISA Section
3(21)(A), to the extent that it exercises such discretion or renders such
advice, it is a fiduciary to the Plan.

         NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants and agreements set forth below, the Sponsor and the Trustee
agree as follows:

SECTION 1. TRUST. The Sponsor hereby establishes the Caraustar Industries, Inc.
Employees' Savings Plan Trust (the "Trust") with the Trustee. The Trust shall
consist of an initial contribution of money or other property acceptable to the
Trustee in its sole discretion, made by the Sponsor or transferred from a
previous trustee under the Plan, such additional sums of money and Sponsor
Stock (hereinafter defined) as shall from time to time be delivered to the
Trustee under the Plan, all investments made therewith and proceeds thereof,
and all earnings and profits thereon, less the payments that are made by the
Trustee as provided herein. The Trustee hereby accepts the Trust on the terms
and conditions set forth in this Agreement. In accepting this Trust, the
Trustee shall be accountable, for the assets received by it, subject to the
terms and conditions of this Agreement.

SECTION 2. EXCLUSIVE BENEFIT AND REVERSION OF SPONSOR CONTRIBUTIONS. Except as
provided under applicable law, no part of the Trust may be used for, or
diverted to, purposes other than the exclusive benefit of the participants in
the Plan or their beneficiaries or the reasonable expenses of Plan
administration.

SECTION 3. DISBURSEMENTS.

         (a)      Administrator-Directed Disbursements. The Trustee shall make
disbursements in the amounts and in the manner that the Administrator directs
from time to time in writing. The Trustee shall have no responsibility to
ascertain such direction's compliance with the terms of the Plan (except to the
extent the terms of the Plan have been communicated to the Trustee in writing)
or of any applicable law or the direction's effect for tax purposes or
otherwise; nor shall the Trustee have any responsibility to see to the
application of any disbursement.

                                       2
<PAGE>

         (b)      Participant Withdrawal Requests. The Sponsor hereby directs
that, pursuant to the Plan, a participant withdrawal request (in-service or
full withdrawal) may be made by the participant by telephone or such other
electronic means as may be agreed to from time to time by the Sponsor and
Trustee, and the Trustee shall process such request only after the identity of
the participant is verified by use of a personal identification number
("PIN") and social security number. The Trustee shall process such withdrawal
in accordance with written guidelines provided by the Sponsor and documented in
the Plan Administrative Manual. In the case of a hardship withdrawal request,
the Trustee shall forward the withdrawal document to the participant for
execution and submission for approval to the Administrator. The Administrator
shall have the responsibility for approving the withdrawal and instructing the
Trustee to send the proceeds to the Administrator or to the participant if so
directed by the Administrator.

         (c)      Limitations. The Trustee shall not be required to make any
disbursement in excess of the net realizable value of the assets of the Trust
at the time of the disbursement. The Trustee shall make cash disbursements in
accordance with the applicable source and fund withdrawal hierarchy as
documented in the Plan Administrative Manual, unless the Administrator has
provided a written direction to the contrary.

SECTION 4. INVESTMENT OF TRUST.

         (a)      Selection of Investment Options. The Trustee shall have no
responsibility for the selection of investment options under the Trust and
shall not render investment advice to any person in connection with the
selection of such options.

         (b)      Available Investment Options. The Named Fiduciary shall
direct the Trustee as to the investment options in which the Trust shall be
invested during the period beginning on the date of the initial transfer of
assets to the Trust and ending on the date of the completion of the
reconciliation of participant records ("Recordkeeping Reconciliation Period"),
and the investment options in which Plan participants may invest following the
Recordkeeping Reconciliation Period. The Named Fiduciary may determine to offer
as investment options only: (i) securities issued by the investment companies
advised by Fidelity Management & Research Company ("Fidelity Mutual Funds") and
certain securities issued by investment companies not advised by Fidelity
Management & Research Company ("Non-Fidelity Mutual Funds") (collectively,
"Mutual Funds"), (ii) equity securities issued by the Sponsor or an affiliate
which are publicly-traded and which are "qualifying employer securities" within
the meaning

                                       3
<PAGE>
of section 407(d)(5) of ERISA ("Sponsor Stock") and (iii) notes evidencing
loans to Plan participants in accordance with the terms of the Plan.

         The investment options initially selected by the Named Fiduciary are
identified on Schedules "A" and "C" attached hereto. The Named Fiduciary may
add additional investment options with the consent of the Trustee and upon
mutual amendment of this Trust Agreement and the Schedules thereto to reflect
such additions.

         (c)      Participant Direction. As authorized under the Plan, each
Plan participant shall direct the Trustee in which investment option(s) to
invest the assets in the participant's individual accounts. Under 29 C.F.R.
2550.404(c)-l(b)(2)(A), the Trustee is a Plan fiduciary to whom participants
are entitled to give investment instructions and who is obligated to confirm
such instructions as provided therein. The Trustee shall comply with such
instructions except as otherwise permitted under 29 C.F.R.
2550.404(c)-l(b)(2)(ii)(B) and 2550.404(c)-l(d)(2)(ii). Such directions may be
made by Plan participants by use of the telephone exchange system, the internet
or in such other manner as may be agreed upon from time to time by the Sponsor
and the Trustee, maintained for such purposes by the Trustee or its agent, in
accordance with written Exchange Guidelines attached hereto as Schedule "G". In
the event that the Trustee fails to receive a proper direction, the assets
shall be invested in the investment option set forth for such purpose on
Schedule "C", until the Trustee receives a proper direction.

         (d)      Mutual Funds. The Named Fiduciary hereby acknowledges that it
has received from the Trustee a copy of the prospectus for each Fidelity Mutual
Fund selected by the Named Fiduciary as a Plan investment option or short-term
investment fund. All transactions involving Non-Fidelity Mutual Funds shall
be done in accordance with the Operational Guidelines attached hereto as
Schedule "H". Trust investments in Mutual Funds shall be subject to the
following limitations:

                  (i)      Execution of Purchases and Sales. Purchases and
sales of Mutual Funds (other than for exchanges) shall be made on the date on
which the Trustee receives from the Administrator in good order all
information, documentation and wire transfer of funds (if applicable) necessary
to accurately effect such transactions. Exchanges of Mutual Funds shall be made
in accordance with the Exchange Guidelines attached hereto as Schedule "G".

                                       4

<PAGE>

                  (ii)     Voting. At the time of mailing of notice of each
annual or special stockholders' meeting of any Mutual Fund, the Trustee shall
send a copy of the notice and all proxy solicitation materials to each Plan
participant who has shares of the Mutual Fund credited to the participant's
accounts, together with a voting direction form for return to the Trustee or
its designee. The participant shall have the right to direct the Trustee as to
the manner in which the Trustee is to vote the shares credited to the
participant's accounts (both vested and unvested). The Trustee shall vote the
shares as directed by the participant. The Trustee shall not vote shares for
which it has received no directions from the participant.

         During the Recordkeeping Reconciliation Period, the Named Fiduciary
shall have the right to direct the Trustee as to the manner in which the Trustee
is to vote the shares of the Mutual Funds in the Trust. Following the
Recordkeeping Reconciliation Period the Named Fiduciary shall continue to have
the right to direct the Trustee as to the manner in which the Trustee is to
vote the Mutual Funds shares held in a short-term liquidity reserve for a
unitized investment option.

         With respect to all rights other than the right to vote, the Trustee
shall follow the directions of the participant and if no such directions are
received, the directions of the Named Fiduciary. The Trustee shall have no
further duty to solicit directions from participants or the Named Fiduciary.

         (e)      Sponsor Stock. Trust investments in Sponsor Stock shall be
subject to the following limitations:

                  (i)      Acquisition Limit. Pursuant to the Plan, the Trust
may be invested in Sponsor Stock to the extent necessary to comply with
investment directions under this Agreement.

                  (ii)     Fiduciary Duty of Named Fiduciary. The Named
Fiduciary shall continually monitor the suitability under the fiduciary duty
rules of section 404(a)(l) of ERISA (as modified by section 404(a)(2) of ERISA)
of acquiring and holding Sponsor Stock. The Trustee shall not be liable for
any loss, or expense, which arises from the directions of the Named Fiduciary
with respect to the acquisition and holding of Sponsor Stock, unless it is
clear on their face that the actions to be taken under those directions would
be prohibited by the foregoing fiduciary duty rules or would be contrary to the
terms of this Agreement.

                                       5
<PAGE>

                  (iii)    Execution of Purchases and Sales.

                           (A)      Purchases and sales of Sponsor Stock (other
than for exchanges) shall be made on the open market on the date on which the
Trustee receives from the Administrator in good order all information,
documentation, and wire transfer of funds (if applicable), necessary to
accurately effect such transactions. Exchanges of Sponsor Stock shall be made
in accordance with the Exchange Guidelines attached hereto as Schedule "G".
Such general rules shall not apply in the following circumstances:

                                    (1)      If the Trustee is unable to
purchase or sell the total number of shares required to be purchased or sold on
such day as a result of market conditions; or

                                    (2)      If the Trustee is prohibited by
the Securities and Exchange Commission, the New York Stock Exchange, or any
other regulatory body from purchasing or selling any or all of the shares
required to be purchased or sold on such day.

In the event of the occurrence of the circumstances described in (1) or (2)
above, the Trustee shall purchase or sell such shares as soon as possible
thereafter and shall determine the price of such purchases or sales to be the
average purchase or sales price of all such shares purchased or sold,
respectively. The Trustee may follow directions from the Named Fiduciary to
deviate from the above purchase and sale procedures provided that such direction
is made in writing by the Named Fiduciary.

                           (B)      Purchases and Sales from or to Sponsor. If
directed by the Sponsor in writing prior to the trading date, the Trustee may
purchase or sell Sponsor Stock from or to the Sponsor if the purchase or sale
is for adequate consideration (within the meaning of section 3(18) of ERISA)
and no commission is charged. If Sponsor contributions (employer) or
contributions made by the Sponsor on behalf of the participants (employee)
under the Plan are to be invested in Sponsor Stock, the Sponsor may transfer
Sponsor Stock in lieu of cash to the Trust. In either case, the number of
shares to be transferred will be determined by dividing the total amount of
Sponsor Stock to be purchased or sold by the 4:00 p.m. NYSE closing price of
the Sponsor Stock on the trading date.

                                       6
<PAGE>

                           (C)      Use of an Affiliated Broker. The Named
Fiduciary hereby directs the Trustee to use Fidelity Capital Markets ("Capital
Markets") to provide brokerage services in connection with any purchase or sale
of Sponsor Stock in accordance with directions from Plan participants. Capital
Markets shall execute such directions directly or through its affiliate,
National Financial Services Company ("NFSC"). The provision of brokerage
services shall be subject to the following:

                                    (1)      As consideration for such
brokerage services, the Named Fiduciary agrees that Capital Markets shall be
entitled to remuneration under this authorization provision in the amount of
five cents ($.05) commission on each share of Sponsor Stock up to 10,000 shares
in a singular transaction, four cents ($.04) commission on each share of
Sponsor Stock from 10,001 to 20,000 shares in a singular transaction, and three
and one-half cents ($.035) commission on each share of Sponsor Stock in excess
of 20,000 shares in a singular transaction. Any change in such remuneration may
be made only by a signed agreement between Sponsor and Trustee.

                                    (2)      The Trustee will provide the
Sponsor with the following: a description of Capital Markets' brokerage
placement practices and a form by which the Sponsor may terminate this
direction to use a broker affiliated with the Trustee. The Trustee will provide
the Sponsor with this termination form annually, as well as quarterly and
annual reports which summarize all securities transaction-related charges
incurred by the Plan.

                                    (3)      Any successor organization of
Capital Markets, through reorganization, consolidation, merger or similar
transactions, shall, upon consummation of such transaction, become the
successor broker in accordance with the terms of this authorization provision.

                                    (4)      The Trustee and Capital Markets
shall continue to rely on this direction provision until notified to the
contrary. The Sponsor reserves the right to terminate this direction upon
written notice to Capital Markets (or its successor) and the Trustee, in
accordance with Section 11 of this Agreement.

                  (iv)     Securities Law Reports. The Administrator shall be
responsible for filing all reports required under Federal or state securities
laws with respect to the Trust's ownership of Sponsor Stock, including, without
limitation, any reports required under section 13 or 16 of the Securities
Exchange Act of 1934, and shall immediately notify the Trustee in writing of
any requirement to stop

                                       7
<PAGE>

purchases or sales of Sponsor Stock pending the filing of any report. The
Trustee shall provide to the Administrator such information on the Trust's
ownership of Sponsor Stock as the Administrator may reasonably request in
order to comply with Federal or state securities laws.

                  (v)      Voting and Tender Offers. Notwithstanding any other
provision of this Agreement the provisions of this Section shall govern the
voting and tendering of Sponsor Stock. The Sponsor shall pay for all printing,
mailing, tabulation and other costs associated with the voting and tendering of
Sponsor Stock. The Trustee, after consultation with the Sponsor, shall prepare
the necessary documents associated with the voting and tendering of Sponsor
Stock.

                           (A)      Voting.

                                    (1)      When the issuer of Sponsor Stock
prepares for any annual or special meeting, the Sponsor shall notify the Trustee
at least thirty (30) days in advance of the intended record date and shall
cause a copy of all proxy solicitation materials to be sent to the Trustee. If
requested by the Trustee the Sponsor shall certify to the Trustee that the
aforementioned materials represents the same information distributed to
shareholders of Sponsor Stock. Based on these materials the Trustee shall
prepare a voting instruction form and shall provide a copy of all proxy
solicitation materials to be sent to each Plan participant with an interest in
Sponsor Stock held in the Trust, together with the foregoing voting instruction
form to be returned to the Trustee or its designee. The form shall show the
number of full and fractional shares of Sponsor Stock credited to the
participant's accounts.

                                    (2)      Each participant with an interest
in the Sponsor Stock held in the Trust shall have the right to direct the
Trustee as to the manner in which the Trustee is to vote that number of shares
of Sponsor Stock credited to the participant's accounts (both vested and
unvested). Directions from a participant to the Trustee concerning the voting
of Sponsor Stock shall be communicated in writing, or other means as agreed
upon by the Trustee and the Sponsor. In accordance with Section 404(c) of the
ERISA, the Trustee shall ensure that these directions shall not be divulged to
the Sponsor, or any officer or employee thereof, or any other person except
to the extent that the consequences of such directions are reflected in reports
regularly communicated to any such person in the ordinary course of the
performance of the Trustee's services hereunder. Such directions shall be
tabulated and processed by the Trustee's agent and held in confidence by the
Trustee's agent.

                                       8
<PAGE>

The Trustee's agent shall communicate to the Trustee only such information as
is necessary to accurately and properly fulfill the Trustee's obligations under
this Section. Upon its receipt of the directions, the Trustee shall vote the
shares of Sponsor Stock as directed by the participant. Except as otherwise
required by law, the Trustee shall not vote shares of Sponsor Stock credited to
a participant's account for which it has received no directions from the
participant.

                           (B)      Tender Offers.

                                    (1)      Upon commencement of a tender
offer for any securities held in the Trust that are Sponsor Stock, the Sponsor
shall timely notify the Trustee in advance of the intended tender date and
shall cause a copy of all materials to be sent to the Trustee. The Sponsor
shall certify to the Trustee that the aforementioned materials represent the
same information distributed to shareholders of Sponsor Stock. Based on these
materials and after consultation with the Sponsor, the Trustee shall prepare a
tender instruction form and shall provide a copy of all tender materials to be
sent to each plan participant with an interest in the Stock Fund, together with
the foregoing tender instruction form, to be returned to the Trustee or its
designee. The tender instruction form shall show the number of full and
fractional shares of Sponsor Stock credited to the participants account (both
vested and unvested).

                                    (2)      Each participant with an interest
in the Stock Fund shall have the right to direct the Trustee to tender or not
to tender some or all of the shares of Sponsor Stock credited to the
participant's accounts (both vested and unvested). Directions from a
participant to the Trustee concerning the tender of Sponsor Stock shall be
communicated in writing, or such other means as is agreed upon by the Trustee
and the Sponsor. In accordance with Section 404(c) of ERISA, these directions
shall not be divulged to the Sponsor, or any officer or employee thereof, or
any other person except to the extent that the consequences of such directions
are reflected in reports regularly communicated to any such persons in the
ordinary course of the performance of the Trustee's services hereunder. Such
directions shall be tabulated and processed by the Trustee's agent and held in
confidence by the Trustee's agent. The Trustee's agent shall communicate to the
Trustee only such information as is necessary to accurately and properly
fulfill the Trustee's obligations under this section. The Trustee shall tender
or not tender shares of Sponsor Stock as directed by the participant. Except as
otherwise required by law, the Trustee shall not tender shares of Sponsor
Stock credited to a participant's accounts for which it has received no
directions from the participant.

                                       9
<PAGE>

                                    (4)      A participant who has directed the
Trustee to tender some or all of the shares of Sponsor Stock credited to the
participant's accounts may, at any time prior to the tender offer withdrawal
date, direct the Trustee to withdraw some or all of the tendered shares, and the
Trustee shall withdraw the directed number of shares from the tender offer prior
to the tender offer withdrawal deadline. A participant shall not be limited as
to the number of directions to tender or withdraw that the participant may give
to the Trustee.

                                    (5)      A direction by a participant to the
Trustee to tender shares of Sponsor Stock credited to the participant's accounts
shall not be considered a written election under the Plan by the participant to
withdraw, or have distributed, any or all of his withdrawable shares. The
Trustee shall credit to each account of the participant from which the tendered
shares were taken the proceeds received by the Trustee in exchange for the
shares of Sponsor Stock tendered from that account. Pending receipt of
directions (through the Administrator) from the participant or the Named
Fiduciary, as provided in the Plan, as to which of the remaining investment
options the proceeds should be invested in, the Trustee shall invest the
proceeds in the investment option described in Schedule "C".

                           (vi)     General. With respect to all rights other
than the right to vote, the right to tender, and the right to withdraw shares
previously tendered, in the case of Sponsor Stock credited to a participant's
accounts, the Trustee shall follow the directions of the participant and if no
such directions are received, the directions of the Named Fiduciary. The
Trustee shall have no duty to solicit directions from participants. With
respect to all rights other than the right to vote and the right to tender, in
the case of Sponsor Stock not credited to participants' accounts, the Trustee
shall follow the directions of the Named Fiduciary.

                           (vii)    Conversion. All provisions in this Section
4(e) shall also apply to any securities received as a result of a conversion of
Sponsor Stock.

         (f)      Participant Loans. The Administrator shall act as the
Trustee's agent for participant loans and as such shall (i) separately account
for repayments of such loans and clearly identify such assets as Plan assets
and (ii) collect and remit all principal and interest payments to the Trustee.
To originate a participant loan, the Plan participant shall direct the Trustee
as to the term and amount of

                                       10
<PAGE>

the loan to be made from the participant's individual account. Such directions
shall be made by Plan participants by use of the system maintained for such
purpose by the Trustee or its agent. The Trustee shall determine, based on the
current value of the participant's account on the date of the request and any
guidelines provided by the Sponsor, the amount available for the loan. Based on
the interest rate supplied by the Sponsor in accordance with the terms of the
Plan, the Trustee shall advise the participant of such interest rate, as well
as the installment payment amounts. The Trustee shall distribute the
Participant loan agreement and truth-in-lending disclosure with the proceeds
check to the participant. To facilitate recordkeeping, the Trustee may destroy
the original of any proceeds check made in connection with a loan to a
participant under the Plan, provided that the Trustee or its agent first
creates a duplicate by a photographic or optical scanning or other process
yielding a reasonable facsimile of the promissory note and the Plan
participant's signature thereon, which duplicate may be reduced or enlarged in
size from the actual size of the original promissory note.

         (g)      Participant Loans for the Purchase of a Primary Residence. The
Administrator shall act as the Trustee's agent for participant loan notes for
the purchase of a primary residence and as such shall (i) separately account
for repayments of such loans and clearly identify such assets as Plan assets
and (ii) collect and remit all principal and interest payments to the Trustee.
To originate a participant loan, the Plan participant shall direct the Trustee
as to the term and amount of the loan to be made from the participant's
individual account. Such directions shall be made by Plan participants by use
of the telephone exchange system maintained for such purpose by the Trustee or
its agent. The Trustee shall determine, based on the current value of the
participant's account on the date of the request and any guidelines provided by
the Sponsor, the amount available for the loan. Based on the interest rate
supplied by the Sponsor in accordance with the terms of the Plan, the Trustee
shall advise the participant of such interest rate, as well as the installment
payment amounts. The Trustee shall forward the loan document to the participant
for execution and submission for processing to the Trustee. In all cases,
processing by the Trustee shall be made within thirty (30) days of the
participant's initial request (the origination date).

         (h)      Reliance of Trustee on Directions.

                  (i)      The Trustee shall not be liable for any loss or
expense which arises from any participant's exercise or non-exercise of rights
under this Section 4 over the assets in the participant's accounts.

                                      11
<PAGE>

                  (ii)     The Trustee shall not be liable for any loss or
expense, which arises from the Named Fiduciary's exercise or non-exercise of
rights under this Section 4, unless it was clear on their face that the actions
to be taken under the Named Fiduciary's directions were prohibited by the
fiduciary duty rules of section 404(a) of ERISA or were contrary to the terms
of the Plan as communicated in writing to the Trustee.

         (i)      Trustee Powers. The Trustee shall have the following powers
and authority:

                  (i)      Subject to paragraphs (b) and (c) of this Section 4,
to sell, exchange, convey, transfer, or otherwise dispose of any property held
in the Trust, by private contract or at public auction. No person dealing with
the Trustee shall be bound to see to the application of the purchase money or
other property delivered to the Trustee or to inquire into the validity,
expediency, or propriety of any such sale or other disposition.

                  (ii)     To cause any securities or other property held as
part of the Trust to be registered in the Trustee's own name, in the name of
one or more of its nominees, or in the Trustee's account with the Depository
Trust Company of New York and to hold any investments in bearer form, but the
books and records of the Trustee shall at all times show that all such
investments are part of the Trust.

                  (iii)    To keep that portion of the Trust in cash or cash
balances as the Named Fiduciary or Administrator may, from time to time, deem
to be in the best interest of the Trust.

                  (iv)     To make, execute, acknowledge, and deliver any and
all documents of transfer or conveyance and to carry out the powers herein
granted.

                  (v)      To borrow funds from a bank not affiliated with the
Trustee in order to provide sufficient liquidity to process Plan transactions
in a timely fashion; provided that the cost of such borrowing shall be
allocated in a reasonable fashion to the investment fund(s) in need of
liquidity.

                  (vi)     To settle, compromise, or submit to arbitration any
claims, debts, or damages due to or arising from the Trust; to commence or
defend suits or legal or administrative proceedings; to

                                      12
<PAGE>

represent the Trust in all suits and legal and administrative hearings; and to
pay all reasonable expenses arising from any such action, from the Trust if not
paid by the Sponsor.

                  (vii)    To employ legal, accounting, clerical, and other
assistance as may be required in carrying out the provisions of this Agreement
and to pay their reasonable expenses and compensation from the Trust if not
paid by the Sponsor.

                  (viii)   To invest all or any part of the assets of the Trust
in GICs and short term investments (including interest bearing accounts with
the Trustee or money market mutual funds advised by affiliates of the
Trustee) and in any collective investment trust or group trust, including any
collective investment trust or group trust maintained by the Trustee, which
then provides for the pooling of the assets of plans described in Section
401(a) and exempt from tax under Section 501(a) of the Internal Revenue Code
("Code"), or any comparable provisions of any future legislation that amends,
supplements, or supersedes those sections, provided that such collective
investment trust or group trust is exempt from tax under the Code or
regulations or rulings issued by the Internal Revenue Service. The provisions
of the document governing such collective investment trusts or group trusts, as
it may be amended from time to time, shall govern any investment therein and
are hereby made a part of this Trust Agreement.

                  (ix)     To do all other acts, although not specifically
mentioned herein, as the Trustee may deem necessary to carry out any of the
foregoing powers and the purposes of the Trust.

SECTION 5. RECORDKEEPING AND ADMINISTRATIVE SERVICES TO BE PERFORMED.

         (a)      General. The Trustee shall perform those recordkeeping and
                  administrative functions described in Schedule "A" attached
                  hereto. These recordkeeping and administrative functions shall
                  be performed within the framework of the Administrator's
                  written directions regarding the Plan's provisions,
                  guidelines and interpretations.

         (b)      Accounts. The Trustee shall keep accurate accounts of all
investments, receipts, disbursements, and other transactions hereunder, and
shall report the value of the assets held in the Trust as of the last day of
each fiscal quarter of the Plan and, if not on the last day of a fiscal
quarter, the date on which the Trustee resigns or is removed as provided in
Section 8 of this Agreement or is terminated as provided in Section 10 (the
"Reporting Date"). Within thirty (30) days following each

                                      13
<PAGE>

Reporting Date or within sixty (60) days in the case of a Reporting Date caused
by the resignation or removal of the Trustee, or the termination of this
Agreement, the Trustee shall file with the Administrator a written account
setting forth all investments, receipts, disbursements, and other transactions
effected by the Trustee between the Reporting Date and the prior Reporting Date,
and setting forth the value of the Trust as of the Reporting Date. Except as
otherwise required under ERISA, upon the expiration of six (6) months from
the date of filing such account, the Trustee shall have no liability or
further accountability with respect to the propriety of its acts or
transactions shown in such account, except with respect to such acts or
transactions as to which a written objection shall have been filed with the
Trustee within such six (6) month period.

         (c)      Inspection and Audit. All records generated by the Trustee in
accordance with paragraphs (a) and (b) shall be open to inspection and audit,
during the Trustee's regular business hours prior to the termination of this
Agreement, by the Administrator or any person designated by the Administrator.
Upon the resignation or removal of the Trustee or the termination of this
Agreement, the Trustee shall provide to the Administrator, at no expense to the
Sponsor, in the format regularly provided to the Administrator, a statement of
each participant's accounts as of the resignation, removal, or termination, and
the Trustee shall provide to the Administrator or the Plan's new recordkeeper
such further records as are reasonable, at the Sponsor's expense.

         (d)      Effect of Plan Amendment. A confirmation of the current
qualified status of the Plan is attached hereto as Schedule "F". The Trustee's
provision of the recordkeeping and administrative services set forth in this
Section 5 shall be conditioned on the Sponsor delivering to the Trustee a copy
of any amendment to the Plan as soon as administratively feasible following the
amendment's adoption, with, if requested, an IRS determination letter or an
opinion of counsel substantially in the form of Schedule "F" covering such
amendment, and on the Administrator providing the Trustee on a timely basis
with all the information the Administrator deems necessary for the Trustee to
perform the recordkeeping and administrative services and such other
information as the Trustee may reasonably request.

         (e)      Returns, Reports and Information. Except as set forth on
Schedule "A", the Administrator shall be responsible for the preparation and
filing of all returns, reports, and information required of the Trust or Plan
by law. The Trustee shall provide the Administrator with such information as
the Administrator may reasonably request to make these filings. The
Administrator

                                      14
<PAGE>

shall also be responsible for making any disclosures to Participants required
by law, except such disclosure as may be required under federal or state
truth-in-lending laws with regard to Participant loans, which shall be provided
by the Trustee.

SECTION 6. COMPENSATION AND EXPENSES. All reasonable expenses of plan
administration as shown on Schedule B attached hereto, as amended from time to
time, shall be a charge against and paid from the appropriate plan
participants' accounts, except to the extent such amounts are paid by the Plan
sponsor in a timely manner.

         All expenses of the Trustee relating directly to the acquisition and
disposition of investments constituting part of the Trust, and all taxes of any
kind whatsoever that may be levied or assessed under existing or future laws
upon or in respect of the Trust or the income thereof, shall levied a charge
against and paid from the appropriate Plan participants' accounts.

SECTION 7. DIRECTIONS AND INDEMNIFICATION.

         (a)      Identity of Administrator and Named Fiduciary. The Trustee
shall be fully protected in relying on the fact that the Named Fiduciary and
the Administrator under the Plan are the individuals or persons named as such
above or such other individuals or persons as the Sponsor may notify the
Trustee in writing.

         (b)      Directions from Administrator. Whenever the Administrator
provides a direction to the Trustee, the Trustee shall not be liable for any
loss or expense arising from the direction (i) if the direction is contained in
a writing (or is oral and immediately confirmed in a writing) signed by any
individual whose name and signature have been submitted (and not withdrawn) in
writing to the Trustee by the Administrator in the form attached hereto as
Schedule "D", and (ii) if the Trustee reasonably believes the signature of the
individual to be genuine, unless it is clear on the direction's face that the
actions to be taken under the direction would be prohibited by the fiduciary
duty rules of Section 404(a) of ERISA or would be contrary to the terms of this
Agreement. For purposes of his Section, such direction may also be made via
electronic data transfer (EDT) or other electronic means in accordance with
procedures agreed to by the Administrator and the Trustee; provided, however,
that the Trustee shall be fully protected in relying on such direction as if it
were a direction made in writing by the Administrator.

                                      15
<PAGE>

         (c)      Directions from Named Fiduciary. Whenever the Named Fiduciary
or Sponsor provides a direction to the Trustee, the Trustee shall not be liable
for any loss or expense arising from the direction (i) if the direction is
contained in a writing (or is oral and immediately confirmed in a writing)
signed by any individual whose name and signature have been submitted (and not
withdrawn) in writing to the Trustee by the Named Fiduciary in the form
attached hereto as Schedule "E" and (ii) if the Trustee reasonably believes the
signature of the individual to be genuine, unless it is clear on the
direction's face that the actions to be taken under the direction would be
prohibited by the fiduciary duty rules of Section 404(a) of ERISA or would be
contrary to the terms of this Agreement. Such direction may also be made via
EDT or other electronic means in accordance with procedures agreed to by the
Named Fiduciary and the Trustee; provided, however, that the Trustee shall be
fully protected in relying on such direction as if it were a direction made in
writing by the Named Fiduciary.

         (d)      Co-Fiduciary Liability. In any other case, the Trustee shall
not be liable for any loss or expense arising from any act or omission of
another fiduciary under the Plan except as provided in section 405(a) of ERISA.

         (e)      Indemnification. The Sponsor shall indemnify the Trustee
against, and hold the Trustee harmless from, any and all loss, damage, penalty,
liability, cost, and expense, including without limitation, reasonable
attorneys' fees and disbursements, that may be incurred by, imposed upon, or
asserted against the Trustee by reason of any claim, regulatory proceeding, or
litigation arising from any act done or omitted to be done by any individual or
person with respect to the Plan or Trust, excepting only any and all loss,
etc., arising from the Trustee's negligence or bad faith.

         The Trustee shall indemnify the Sponsor against, and hold the Sponsor
harmless from, any and all loss, damage, penalty, liability, cost and expense,
including without limitation, reasonable attorneys' fees and disbursements,
that may be incurred by, imposed upon, or asserted against the Sponsor by
reason of any claim, regulatory proceeding, or litigation arising from
Trustee's negligence, bad faith, error, mistake, breach of fiduciary duty or
breach of this agreement.

         (f)      Survival. The provisions of this Section 7 shall survive the
termination of this Agreement.

                                      16
<PAGE>

SECTION 8. RESIGNATION OR REMOVAL OF TRUSTEE.

         (a)      Resignation. The Trustee may resign at any time upon sixty
(60) days' notice in writing to the Sponsor, unless a shorter period of notice
is agreed upon by the Sponsor.

         (b)      Removal. The Sponsor may remove the Trustee at any time upon
sixty (60) days' notice in writing to the Trustee, unless a shorter period of
notice is agreed upon by the Trustee.

SECTION 9. SUCCESSOR TRUSTEE.

         (a)      Appointment. If the office of Trustee becomes vacant for any
reason, the Sponsor may in writing appoint a successor trustee under this
Agreement. The successor trustee shall have all of the rights, powers,
privileges, obligations, duties, liabilities, and immunities granted to the
Trustee under this Agreement. The successor trustee and predecessor trustee
shall not be liable for the acts or omissions of the other with respect to the
Trust.

         (b)      Acceptance. When the successor trustee accepts its
appointment under this Agreement, title to and possession of the Trust assets
shall immediately vest in the successor trustee without any further action on
the part of the predecessor trustee. The predecessor trustee shall execute all
instruments and do all acts that reasonably may be necessary or reasonably may
be requested in writing by the Sponsor or the successor trustee to vest title
to all Trust assets in the success or trustee or to deliver all Trust assets to
the successor trustee.

         (c)      Corporate Action. Any successor of the Trustee or successor
trustee, through sale or transfer of the business or trust department of the
Trustee or successor trustee, or through reorganization, consolidation, or
merger, or any similar transaction, shall, upon consummation of the
transaction, become the successor trustee under this Agreement.

SECTION 10. TERMINATION. This Agreement may be terminated at any time by the
Sponsor upon sixty (60) days' notice in writing to the Trustee. On the date of
the termination of this Agreement, the Trustee shall forthwith transfer and
deliver to such individual or entity as the Sponsor shall designate, all cash
and assets then constituting the Trust. If, by the termination date, the
Sponsor has not notified the Trustee in writing as to whom the assets and cash
are to be transferred and delivered, the Trustee may bring an appropriate
action or proceeding for leave to deposit the assets and cash in a court of

                                      17
<PAGE>

competent jurisdiction. The Trustee shall be reimbursed by the Sponsor for all
costs and expenses of the action or proceeding including, without limitation,
reasonable attorneys' fees and disbursements.

SECTION 11. RESIGNATION, REMOVAL, AND TERMINATION NOTICES. All notices of
resignation, removal, or termination under this Agreement must be in writing
and mailed to the party to which the notice is being given by certified or
registered mail, return receipt requested, to the Sponsor c/o Corporate
Secretary & Manager of Administrative Services, P.O. Box 115 Austell, GA 30168,
and to the Trustee c/o Legal Department, ERISA Group, Fidelity Investments,
82 Devonshire Street, Boston, Massachusetts 02109, or to such other addresses
as the parties have notified each other of in the foregoing manner.

SECTION 12. DURATION. This Trust shall continue in effect without limit as to
time, subject, however, to the provisions of this Agreement relating to
amendment, modification, and termination thereof.

SECTION 13. AMENDMENT OR MODIFICATION. This Agreement may be amended or
modified at any time and from time to time only by an instrument executed by
both the Sponsor and the Trustee. Notwithstanding the foregoing, to reflect
increased operating costs the Trustee may once each calendar year amend
Schedule "B" without the Sponsor's consent upon seventy-five (75) days written
notice to the Sponsor.

SECTION 14. ELECTRONIC SERVICES.

         (a)      The Trustee may provide communications and services via
electronic medium ("Electronic Services"), including, but not limited to,
Fidelity Plan Sponsor WebStation, Client Intranet, Client e-mail, interactive
software products or any other information provided in an electronic format.
The Sponsor and its agents agree to use such Electronic Services only in the
course of reasonable administration of the plan and to not commercially exploit
such Electronic Services.

         (b)      The Sponsor shall be responsible for installing and
maintaining all Electronic Services on its computer network and/or Intranet
upon receipt in a manner so that the information provided via the Electronic
Service will appear in the same form and content as it appears on the form of
delivery, and for any programming required to accomplish the installation.
Materials provided for the Sponsor's Intranet web sites shall be installed by
the Sponsor and shall be clearly identified as originating from Trustee. The
Sponsor shall promptly remove Electronic Services from its computer network
and/or

                                      18
<PAGE>

Intranet, or replace the Electronic Service with an updated service provided by
the Trustee, upon written notification (including written notification via
facsimile) by the Trustee.

         (c)      Trustee hereby grants to Sponsor a non-exclusive,
non-transferable, revocable right and license to use the Electronic Services in
accordance with the terms and conditions of this Agreement.

         (d)      To the extent that any Electronic Services utilize Internet
services to transport data or communications, the Trustee will take, and the
Sponsor agrees to follow, reasonable security precautions; however, the Trustee
disclaims any liability for interception of any such data or communications.
The Trustee shall not be responsible for, and makes no warranties regarding
access, speed or availability of Internet or network services. The Trustee
shall not be responsible for any loss or damage related to or resulting from
any changes or modifications to the electronic material after delivering it to
the Sponsor.

SECTION 15. GENERAL.

         (a)      Performance by Trustee, its Agents or Affiliates. The Sponsor
acknowledges and authorizes that the services to be provided under this
Agreement shall be provided by the Trustee, its agents or affiliates,
including Fidelity Investments Institutional Operations Company, Inc. or its
successor, and that certain of such services may be provided pursuant to one or
more other contractual agreements or relationships.

         (b)      Entire Agreement. This Agreement together with the schedules
attached hereto, which are hereby incorporated herein, contains all of the
terms agreed upon between the parties with respect to the subject matter
hereof.

         (c)      Waiver. No waiver by either party of any failure or refusal
to comply with an obligation hereunder shall be deemed a waiver of any other or
subsequent failure or refusal to so comply.

         (d)      Successors and Assigns. The stipulations in this Agreement
shall inure to the benefit of, and shall bind, the successors and assigns of
the respective parties.

                                      19
<PAGE>
         (e)      Partial Invalidity. If any term or provision of this Agreement
or the application thereof to any person or circumstances shall, to any extent,
be invalid or unenforceable, the remainder of this Agreement, or the application
of such term or provision to persons or circumstances other than those as to
which it is held invalid or unenforceable, shall not be affected thereby, and
each term and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.

         (f)      Section Headings. The headings of the various sections and
subsections of this Agreement have been inserted only for the purposes of
convenience and are not part of this Agreement and shall not be deemed in any
manner to modify, explain, expand or restrict any of the provisions of this
Agreement.

SECTION 16. GOVERNING LAW.

         (a)      Massachusetts Law Controls. This Agreement is being made in
the Commonwealth of Massachusetts, and the Trust shall be administered as a
Massachusetts trust. The validity, construction, effect, and administration of
this Agreement shall be governed by and interpreted in accordance with the laws
of the Commonwealth of Massachusetts, except to the extent those laws are
superseded under Section 514 of ERISA.

         (b)      Trust Agreement Controls. The Trustee is not a party to the
Plan, and in the event of any conflict between the provisions of the Plan and
the provisions of this Agreement, the provisions of this Agreement shall
control.

                                       20
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the day and year first above
written.

                                            CARAUSTAR INDUSTRIES, INC.

Attest: /s/ Marinan R. Mays                 By: /s/ Barry Smedstad
        -----------------------------           -------------------------------
        Secretary
                                            Name: Barry Smedstad
                                                  -----------------------------

                                            Title: VP, HR
                                                   ----------------------------

                                            Date: 9/30/99
                                                  -----------------------------

                                            FIDELITY MANAGEMENT TRUST
                                            COMPANY

Attest: /s/ Douglas O. Kent                 By: /s/ Carolyn Redden
        -----------------------------           -------------------------------
        Assistant Clerk
                                            Name: Carolyn Redden
                                                  -----------------------------

                                            Title: Vice President
                                                   ----------------------------

                                            Date: 10/18/99
                                                  -----------------------------

                                       21
<PAGE>

                                  Schedule "A"

                            ADMINISTRATIVE SERVICES

ADMINISTRATION

*        Establishment and maintenance of participant account and election
         percentages.

*        Maintenance of the following Plan investment options:

         -        Caraustar Common Stock Fund
         -        Fidelity Balanced Fund
         -        Fidelity Diversified International Fund
         -        Fidelity Dividend Growth Fund
         -        Fidelity Equity-Income Fund
         -        Fidelity Freedom 2000 Fund
         -        Fidelity Freedom 2010 Fund
         -        Fidelity Freedom 2020 Fund
         -        Fidelity Freedom 2030 Fund
         -        Fidelity Freedom Income Fund
         -        Fidelity Large-Cap Stock Fund
         -        Fidelity Low-Priced Stock Fund
         -        Fidelity Money Market Trust: Retirement Money Market Portfolio
         -        Fidelity OTC Portfolio
         -        Spartan U.S. Equity Index Fund
         -        Arial Appreciation Fund
         -        PIMCO Total Return Fund

*        Maintenance of the following money classifications:

         -        Employee Tax-Deferred
         -        Employee After-Tax
         -        Employer Match

*        The Trustee will provide the recordkeeping and administrative services
         set forth on this Schedule "A" or as otherwise agreed to in writing
         between Sponsor and Trustee.

A)       PARTICIPANT TELEPHONE SERVICES

         1.       Participant service representatives are available each
                  business day from 8:30 a.m. ET - 8:00 p.m. in the
                  participant's time zone in the continental United States to
                  provide toll free telephone service for participant inquiries
                  and transactions.

         2.       Through the automated voice response system and on-line
                  account access via the World Wide Web, participants also have
                  virtually 24 hour account inquiry and transaction
                  capabilities.

                                       22
<PAGE>

         3.       For security purposes, all calls are recorded. In addition,
                  several levels of security are available including the
                  verification of a Personal Identification Number (PIN) and/or
                  any other indicative data resident on the system.

         4.       The following telephone services are available:

                  -        Enroll new participants via telephone; provide
                           confirmation of enrollment within five (5) calendar
                           days of the request.
                  -        Provide Plan investment option information.
                  -        Provide and maintain information and explanations
                           about Plan provisions.
                  -        Respond to requests for literature.
                  -        Allow participants to change their deferral and
                           after-tax percentages and provide updates via EDT
                           for the Sponsor to apply to its payrolls accordingly.
                  -        Maintain and process changes to participants'
                           contribution allocations for all money sources.
                  -        Process exchanges (transfers) between investment
                           options on a daily basis.
                  -        Process hardship withdrawal requests according to
                           written direction provided by the Sponsor.
                  -        Process in-service and full withdrawal requests
                           according to written direction provided by the
                           Sponsor.
                  -        Consult with participants on various loan scenarios
                           and generate all documentation
                  -        Process loan requests according to written direction
                           provided by the Sponsor.

B)       PLAN ACCOUNTING

         1.       Process consolidated payroll contributions according to the
                  Sponsor's payroll frequency via EDT, consolidated magnetic
                  tape or diskette. The data format will be provided by
                  Trustee.

         2.       Maintain and update employee data necessary to support plan
                  administration. The data will be submitted according to
                  payroll frequency.

         3.       Provide daily Plan and participant level accounting for all
                  Plan investment options.

         4.       Provide daily Plan and participant level accounting for all
                  money classifications for the Plan.

         5.       Audit and reconcile the Plan and participant accounts daily.

         6.       Reconcile and process participant withdrawal requests and
                  distributions as approved and directed by the Sponsor. All
                  requests are paid based on the current market values of
                  participants' accounts, not advanced or estimated values. A
                  distribution report will accompany each check.

         7.       Track individual participant loans; process loan withdrawals;
                  re-invest loan repayments; and prepare and deliver
                  comprehensive reports to the Sponsor to assist in the
                  administration of participant loans.

                                       23
<PAGE>

         8.       Maintain and process changes to participants' deferral
                  percentage and prospective and existing investment mix
                  elections.

C)       PARTICIPANT REPORTING

         1.       Mail confirmation to participants of all participant initiated
                  transactions within three to five calendar days of the
                  transaction.

         2.       Prepare and mail via first class to each Plan participant a
                  quarterly detailed participant statement reflecting all
                  activity for the period. Statements will be mailed not later
                  than twenty (20) calendar days after the end of each month in
                  the absence of unusual circumstances.

         3.       Mail required 402(f) notification for distribution from the
                  Plan. This notice advises participants of the tax consequences
                  of their Plan distributions.

D)       PLAN REPORTING

         1.       Prepare, reconcile and deliver a monthly Trial Balance Report
                  presenting all money classes and investments. This report is
                  based on the market value as of the last business day of the
                  month. The report will be delivered not later than twenty
                  (20) calendar days after the end of each month in the absence
                  of unusual circumstances.

         2.       Prepare, reconcile and deliver a Quarterly Administrative
                  Report presenting both on a participant and a total Plan basis
                  all money classes, investment positions and a summary of all
                  activity of the participant and Plan as of the last business
                  day of the quarter. The report will be delivered not later
                  than twenty (20) calendar days after the end of each quarter
                  in the absence of unusual circumstances.

E)       GOVERNMENT REPORTING

         1.       Process year-end tax reports for participants - 1099-R, as
                  well as financial reporting to assist in the preparation of
                  Form 5500.

F)       COMMUNICATION & EDUCATION SERVICES

         1.       Trustee designs, produces and distributes a customized
                  comprehensive communications program for employees. The
                  program may include multimedia informational materials,
                  investment education and planning materials, access to
                  Fidelity's homepage on the Internet and STAGES magazine.
                  Additional fees for such services as mutually agreed upon
                  between Sponsor and Trustee.

G)       OTHER

                                       24
<PAGE>

         1.       Perform non-discrimination limitation testing upon request.
                  In order to obtain this service, the client shall be required
                  to provide the information identified in the Fidelity
                  Discrimination Testing Package Guidelines. Any fees and
                  restrictions associated with this testing service shall be
                  addressed in such Guidelines.

         2.       Monitor and process required minimum distribution amounts
                  ("MRD") as follows: the Trustee will notify the MRD
                  participant and, upon notification from the MRD participant,
                  will use the MRD participant's information to process the
                  distribution. If the MRD participant does not respond to the
                  Trustee's notification, the Sponsor directs the Trustee to
                  automatically begin the required distribution for the
                  participant.

         3.       The Fidelity Participant Recordkeeping System is available
                  on-line to the Sponsor via the Plan Sponsor Webstation
                  ("PSW"). PSW is a graphical, Windows-based application that
                  provides current plan and participant-level information,
                  including indicative data, account balances, activity and
                  history.

CARAUSTAR INDUSTRIES, INC.                   FIDELITY MANAGEMENT TRUST
                                             COMPANY

By: /s/ Barry A. Smedstad    9/30/99         By: /s/ Carolyn Redden     10/18/99
    --------------------------------             -------------------------------
                              Date               Vice President           Date

                                       25
<PAGE>

                                  SCHEDULE "B"

                                  FEE SCHEDULE

<TABLE>
<S>                                                          <C>
Annual Participant Fee:                                      $38.00 per participant*, billed and payable
                                                             quarterly.

Enrollments by Phone:                                        $5.00 per non-active employee residing on
                                                             Fidelity's participant recordkeeping system.

Loan Fee:                                                    Establishment fee of $35.00 per loan account;
                                                             annual fee of $15.00 per loan account.

Minimum Required Distribution:                               $25.00 per participant per MRD Withdrawal.

In-Service Withdrawals by Phone:                             $20.00 per withdrawal.

Plan Sponsor Webstation (PSW):                               Two User I.D.'s provided free of charge.
                                                             Each additional I.D., $500.00 per year.

Return of Excess Contribution Fee:                           $25.00 per participant, one-time charge per
                                                             calculation and check generation.
</TABLE>

-        Trustee shall provide the Sponsor with a one time credit of $10,000.00
         for services.

-        Other Fees: separate charges for optional non-discrimination testing,
         extraordinary expenses resulting from large numbers of simultaneous
         manual transactions, from errors not caused by Fidelity, reports not
         contemplated in this Agreement, corporate actions, or the provision of
         communications materials in hard copy which are also accessible to
         participants via electronic services in the event that the provision of
         such material in hard copy would result in an additional expense deemed
         to be material. The Administrator may direct Trustee to withdraw
         reasonable administrative fees from the Trust by written direction to
         the Trustee.

*        This fee will be imposed pro rata for each calendar quarter, or any
         part thereof, that it remains necessary to keep a participant's
         account(s) as part of the Plan's records, e.g., vested, deferred,
         forfeiture, top-heavy and terminated participants who must remain on
         file through calendar year-end for 1099-R reporting purposes.

TRUSTEE FEE

         To the extent that assets are invested in Sponsor Stock, .10% of such
         assets in the Trust payable pro rata quarterly on the basis of such
         assets as of the calendar quarter's last valuation date, but no less
         than $10,000.00 nor more than $35,000.00 per year.

                                       26
<PAGE>

          Note: These fees have been negotiated and accepted based on the
          following Plan characteristics: current plan assets of $44.4 million,
          current participation of 2,081 participants, current stock assets of
          $9.8 million, total Fidelity actively managed Mutual Fund assets of
          $34.6 million, and projected net cash flows of $6.1 million per year.
          Fees will be subject to revision if these Plan characteristics change
          significantly by either falling below or exceeding current or
          projected levels. Fees also have been based on the use of up to 17
          investment options, and such fees will be subject to revision if
          additional investment options are added.

CARAUSTAR INDUSTRIES, INC.                   FIDELITY MANAGEMENT TRUST
                                             COMPANY

By: /s/ Barry A. Smedstad    9/30/99         By: /s/ Carolyn Redden     10/18/99
    --------------------------------             -------------------------------
                                Date             Vice President             Date

                                       27
<PAGE>

                                  SCHEDULE "C"

                                INVESTMENT OPTIONS

         In accordance with Section 4(b), the Named Fiduciary hereby directs the
Trustee that participants' individual accounts may be invested in the following
investment options:

         -        Caraustar Common Stock Fund
         -        Fidelity Balanced Fund
         -        Fidelity Diversified International Fund
         -        Fidelity Dividend Growth Fund
         -        Fidelity Equity-Income Fund
         -        Fidelity Freedom 2000 Fund
         -        Fidelity Freedom 2010 Fund
         -        Fidelity Freedom 2020 Fund
         -        Fidelity Freedom 2030 Fund
         -        Fidelity Freedom Income Fund
         -        Fidelity Large-Cap Stock Fund
         -        Fidelity Low-Priced Stock Fund
         -        Fidelity Money Market Trust: Retirement Money Market Portfolio
         -        Fidelity OTC Portfolio
         -        Spartan U.S. Equity Index Fund
         -        Arial Appreciation Fund
         -        PIMCO Total Return Fund

         The named Fiduciary hereby directs that the investment option referred
to in Section 4(c) and Section 4(e)(v)(B)(5) shall be Fidelity Money Market
Trust: Retirement Money Market Portfolio.

CARAUSTAR INDUSTRIES, INC.

By: /s/ Barry A. Smedstad       9/30/99
    -----------------------------------
                                   Date

                                       28
<PAGE>

                                  SCHEDULE "D"

                          [ADMINISTRATOR'S LETTERHEAD]

                                                                          [DATE]

Ms. Carolyn Redden
Fidelity Investments Institutional Operations Company, Inc.
82 Devonshire Street- MM3H
Boston, Massachusetts 02109

                                 [NAME OF PLAN]

         *** NOTE: This schedule should contain names and signatures for ALL
         individuals who will be providing directions to Fidelity
         representatives in connection with the Plan.

         Fidelity representatives will be unable to accept directions from any
         individual whose name does not appear on this schedule.***

Dear Ms. Redden:

         This letter is sent to you in accordance with Section 7(b) of the Trust
Agreement, dated as of [date], between [name of Plan Sponsor] and Fidelity
Management Trust Company. [I or We] hereby designate [name of individual], [name
of individual], and [name of individual], as the individuals who may provide
directions on behalf of the administrator upon which Fidelity Management Trust
Company shall be fully protected in relying. Only one such individual need
provide any direction. The signature of each designated individual is set forth
below and certified to be such.

         You may rely upon each designation and certification set forth in this
letter until [I or we] deliver to you written notice of the termination of
authority of a designated individual

                                    Very truly yours,

                                    [ADMINISTRATOR]

                                    By

 [signature of designated individual]
 -------------------------------------
 [name of designated individual]

 [signature of designated individual]
 -------------------------------------
 [name of designated individual]

 [signature of designated individual]
 -------------------------------------
 [name of designated individual]

                                       29
<PAGE>

                                  SCHEDULE "E"

                         [NAMED FIDUCIARY'S LETTERHEAD]

                                                                          [DATE]

Ms. Carolyn Redden
Fidelity Investments Institutional Operations Company, Inc.
82 Devonshire Street - MM3H
Boston, Massachusetts 02109

                                 [NAME OF PLAN]

Dear Ms. Redden:

         This letter is sent to you in accordance with Section 7(c) of the Trust
Agreement, dated as of [date], between [name of Plan Sponsor] and Fidelity
Management Trust Company, [I or We] hereby designate [name of individual], [name
of individual], and [name of individual], as the individuals who may provide
directions on behalf of the named fiduciary upon which Fidelity Management
Trust Company shall be fully protected in relying. Only one such individual need
provide any direction. The signature of each designated individual is set forth
below and certified to be such.

         You may rely upon each designation and certification set forth in this
letter until [I or we] deliver to you written notice of the termination of
authority of a designated individual.

                                    Very truly yours,

                                    [NAMED FIDUCIARY]

                                    By

 [signature of designated individual]
 -------------------------------------
 [name of designated individual]

 [signature of designated individual]
 -------------------------------------
 [name of designated individual]

 [signature of designated individual]
 -------------------------------------
 [name of designated individual]

                                       30
<PAGE>

                                  SCHEDULE "F"

                             [LAW FIRM LETTERHEAD]

**NOTE: MAY SUBSTITUTE THE PLAN'S IRS DETERMINATION LETTER IF THE LETTER IS NO
MORE THAT TWO YEARS OLD.

Ms. Carolyn Redden
Fidelity Investments Institutional Operations Company, Inc.
82 Devonshire Street - MM3H
Boston, MA 02109

                                 [NAME OF PLAN]

Dear Ms. Redden

         In accordance with your request, this letter sets forth our opinion
with respect to the qualified status under section 401(a) of the Internal
Revenue Code of 1986 (including amendments made by the Employee Retirement
Income Security Act of 1974) (the "Code"), of the [name of plan], as amended to
the date of this letter (the "Plan").

         The material facts regarding the Plan as we understand them are as
follows. The most recent favorable determination letter as to the Plan's
qualified status under section 401(a) of the Code was issued by the [location
of Key District] District Director of the Internal Revenue Service and was dated
[date] (copy enclosed). The version of the Plan submitted by [name of company]
(the "Company") for the District Director's review in connection with this
determination letter did not contain amendments made effective as of [date].
These amendments, among other matters, [brief description of amendments].
[Subsequent amendments were made on [date] to amend the provisions dealing with
[brief description of amendments].]

         The Company has informed us that it intends to submit the Plan to the
[location of Key District] District Director of the Internal Revenue Service and
to request from him a favorable determination letter as to the Plan's qualified
status under section 401(a) of the Code. The Company may have to make some
modifications to the Plan at the request of the Internal Revenue Service in
order to obtain this favorable determination letter, but we do not expect any of
these modifications to be material. The Company has informed us that it will
make these modifications.

         Based on the foregoing statements of the Company and our review of the
provisions of the Plan, it is our opinion that the Internal Revenue Service will
issue a favorable determination letter as to the qualified status of the Plan,
as modified at the request of the Internal Revenue Service, under section 401(a)
of the Code, subject to the customary condition that continued qualification of
the Plan, as modified, will depend on its effect in operation.

         [Furthermore, in that the assets are in part invested in common stock
issued by the Company or an affiliate, it is our opinion that the Plan is an
"eligible individual account plan" (as defined under Section 407(d)(3) of ERISA)
and that the shares of common stock of the Company held and to be purchased
under the Plan are "qualifying employer securities" (as

                                       31
<PAGE>

defined under Section 407(d)(5) of ERISA). Finally, it is our opinion that
interests in the Plan are not required to be registered under the Securities Act
of 1933, as amended, or, if such registration is required, that such interests
are effectively registered under said Act.]

                                   Sincerely,
                                   [name of law firm]

                                   By     [signature]
                                     -----------------------
                                        [name of partner]

                                       32
<PAGE>

                                  SCHEDULE "G"

                               EXCHANGE GUIDELINES

The following exchange guidelines are currently employed by Fidelity Investments
Institutional Operations Company, Inc. (FIIOC).

Exchange hours, via a Fidelity participant service representative, are 8:30 a.m.
(ET to 8:00 p.m. in the participant's time zone in the continental United States
on each business day. A "business day" is any day on which the New York Stock
Exchange (NYSE) is open.

Exchanges via VRS and the internet may be made virtually 24 hours a day.

FIIOC reserves the right to change these telephone exchange guidelines at its
discretion.

Note: The NYSE's normal closing time is 4:00 p.m. (ET); in the event the NYSE
alters its closing time, all references below to 4:00 p.m. (ET) shall mean the
NYSE closing time as altered.

                                  MUTUAL FUNDS

         EXCHANGES BETWEEN MUTUAL FUNDS

         Participants may call on any business day to exchange between the
         mutual finds. If the request is confirmed before 4:00 p.m. (ET), it
         will receive that day's trade date. Requests confirmed after 4:00 p.m.
         (ET) will be processed on a next business day basis.

                                  SPONSOR STOCK

I.       EXCHANGES FROM MUTUAL FUNDS INTO SPONSOR STOCK

         Sponsor Stock exchanges are processed on a daily cycle. Participants
         who wish to exchange out of a mutual fund into Sponsor Stock may call
         on any business day. Calls received after 4:00 p.m. (ET) will be
         processed as if received on the following business day.

         Mutual fund shares are sold on the day on which the request is
         received. Sponsor Stock is purchased two (2) business days later (call
         date plus 2) and will appear in the participant's account on the
         following business day (call date plus 3).

II.      EXCHANGES FROM SPONSOR STOCK INTO MUTUAL FUNDS

         Participants who wish to exchange out of Sponsor Stock into mutual
         funds may call on any business day. Calls received after 4:00 p.m. (ET)
         will be processed as if received on the following business day.

         The Sponsor Stock is sold on the business day following the call. The
         subsequent purchase into mutual fund shares will take place three (3)
         business days later (call date plus 4) to allow for settlement of the
         stock trade at the custodian and the corresponding transfer of assets
         to Fidelity.

                                       33
<PAGE>

         The mutual fund shares will appear in the participant's account on the
         following business day (call date plus 5).

CARAUSTAR INDUSTRIES, INC.

By: /s/ Barry A. Smedstad
    ---------------------

Name:   Barry Smedstad
     --------------------

Title:       VP, HR
       ------------------

Date:      9/30/99
      -------------------

                                       34
<PAGE>

                                  SCHEDULE "H"

              OPERATIONAL GUIDELINES FOR NON-FIDELITY MUTUAL FUNDS

PRICING

By 7:00 p.m. Eastern Time ("ET") each Business Day, the Non-Fidelity Mutual Fund
Vendor (Fund Vendor) will input the following information ("Price Information")
into this Fidelity Participant Recordkeeping System ("FPRS") via the remote
access price screen that Fidelity Investments Institutional Operations Company,
Inc. ("FIIOC"), an affiliate of the Trustee, has provided to the Fund Vendor:
(1) the net asset value for each Fund at the Close of Trading, (2) the change in
each Fund's net asset value from the Close of Trading on the prior Business Day,
and (3) in the case of an income fund or funds, the daily accrual for interest
rate factor ("mil rate"). FIIOC must receive Price Information each Business
Day (a "Business Day" is any day the New York Stock Exchange is open). If on any
Business Day the Fund Vendor does not provide such Price Information to FIIOC,
FIIOC shall pend all associated transaction activity in the Fidelity Participant
Recordkeeping System ("FPRS") until the relevant Price Information is made
available by Fund Vendor.

TRADE ACTIVITY AND WIRE TRANSFERS

By 7:00 a.m. ET each Business Day following Trade Date ("Trade Date plus One"),
FIIOC will provide, via facsimile, to the Fund Vendor a consolidated report of
net purchase or net redemption activity that occurred in each of the Funds up to
4:00 p.m. ET on the prior Business Day. The report will reflect the dollar
amount of assets and shares to be invested or withdrawn for each Fund. FIIOC
will transmit this report to the Fund Vendor each Business Day, regardless of
processing activity. In the event that data contained in the 7:00 a.m. ET
facsimile transmission represents estimated trade activity, FIIOC shall provide
a final facsimile to the Fund Vendor by no later than 9:00 a.m. ET. Any
resulting adjustments shall be processed by the Fund Vendor at the net asset
value for the prior Business Day.

The Fund Vendor shall send via regular mail to FIIOC transaction confirms for
all daily activity in each of the Funds. The Fund Vendor shall also send via
regular mail to FIIOC, by no later than the fifth Business Day following
calendar month close, a monthly statement for each Fund. FIIOC agrees to notify
the Fund Vendor of any balance discrepancies within twenty (20) Business Days of
receipt of the monthly statement.

                                       35
<PAGE>

For purposes of wire transfers, FIIOC shall transmit a daily wire for aggregate
purchase activity and the Fund Vendor shall transmit a daily wire for aggregate
redemption activity, in each case including all activity across all Funds
occurring on the same day.

PROSPECTUS DELIVERY

FIIOC shall be responsible for the timely delivery of Fund prospectuses and
periodic Fund reports ("Required Materials") to Plan participants, and shall
retain the services of a third-party vendor to handle such mailings. The Fund
Vendor shall be responsible for all materials and production costs, and hereby
agrees to provide the Required Materials to the third-party vendor selected by
FIIOC. The Fund Vendor shall bear the costs of mailing annual Fund reports to
Plan participants. FIIOC shall bear the costs of mailing prospectuses to Plan
participants.

PROXIES

The Fund Vendor shall be responsible for all costs associated with the
production of proxy materials. FIIOC shall retain the services of a third-party
vendor to handle proxy solicitation mailings and vote tabulation. Expenses
associated with such services shall be billed directly to the Fund Vendor by the
third-party vendor.

PARTICIPANT COMMUNICATIONS

The Fund Vendor shall provide internally-prepared fund descriptive information
approved by the Funds' legal counsel for use by FIIOC in its written participant
communication materials. FIIOC shall utilize historical performance data
obtained from third-party vendors (currently Morningstar, Inc., FACTSET Research
Systems and Lipper Analytical Services) in telephone conversations with plan
participants and in quarterly participant statements. The Sponsor hereby
consents to FIIOC's use of such materials and acknowledges that FIIOC is not
responsible for the accuracy of such third-party information. FIIOC shall seek
the approval of the Fund Vendor prior to retaining any other third-party vendor
to render such data or materials under this Agreement.

COMPENSATION

FIIOC shall be entitled to fees as set forth in a separate agreement with the
Fund Vendor.

                                       36
<PAGE>

                   FIRST AMENDMENT TO TRUST AGREEMENT BETWEEN
                      FIDELITY MANAGEMENT TRUST COMPANY AND
                           CARAUSTAR INDUSTRIES, INC.

         THIS FIRST AMENDMENT, dated as of the first day of January, 2000, by
and between Fidelity Management Trust Company (the "Trustee") and Caraustar
Industries, Inc. (the "Sponsor");

                                   WITNESSETH:

         WHEREAS, the Trustee and the Sponsor heretofore entered into a Trust
Agreement dated October 1, 1999, with regard to the Caraustar Industries, Inc.
Employees' Savings Plan (the "Plan"); and

         WHEREAS, the Trustee and the Sponsor now desire to amend said Trust
Agreement as provided for in Section 13 thereof;

         NOW THEREFORE, in consideration of the above premises, the Trustee and
the Sponsor hereby amend the Trust Agreement by:

                  (1)      Amending the "money classification" portion of
                           Schedule "A" by adding the following:

                           -        Prior Co. Match Pre 93
                           -        Prior Co. Match Post 92

         IN WITNESS WHEREOF, the Trustee and the Sponsor have caused this First
Amendment to be executed by their duly authorized officers effective as of the
day and year first above written.

CARAUSTAR INDUSTRIES, INC.                   FIDELITY MANAGEMENT TRUST
                                             COMPANY

By: /s/ Barry A. Smedstad     1/3/2000       By: /s/ Carolyn Redden    1/28/2000
    ----------------------------------           -------------------------------
                                Date             Vice President           Date

<PAGE>

                   SECOND AMENDMENT TO TRUST AGREEMENT BETWEEN
                      FIDELITY MANAGEMENT TRUST COMPANY AND
                           CARAUSTAR INDUSTRIES, INC.

         THIS SECOND AMENDMENT, dated as of the First day of May, 2000, by and
between Fidelity Management Trust Company (the "Trustee") and Caraustar
Industries, Inc. (the "Sponsor");

                                   WITNESSETH:

         WHEREAS, the Trustee and the Sponsor heretofore entered into a Trust
Agreement dated October 1, 1999, with regard to the Caraustar Industries, Inc.
Employees' Savings Plan (the "Plan"); and

         WHEREAS, the Trustee and the Sponsor now desire to amend said Trust
Agreement as provided for in Section 13 thereof;

         NOW THEREFORE, in consideration of the above premises, the Trustee and
the Sponsor hereby amend the Trust Agreement by:

         (1)      Amending Section 7(e), Indemnification to add the following.

                  Special Indemnification for Fidelity PortfolioPlanner(SM). The
                  Trustee shall indemnify the Sponsor against and hold the
                  Sponsor harmless from any and all such loss, damage, penalty,
                  liability, cost, and expense, including without limitation,
                  reasonable attorney's fees and disbursements, that may be
                  incurred by, imposed upon, or asserted against the Sponsor
                  solely as a result of a) any defects in the investment
                  methodology embodied in the target asset allocation or model
                  portfolio provided through Fidelity PortfolioPlanner, except
                  to the extent that any such loss, damage, penalty, liability,
                  cost or expense arises from information provided by the
                  participant, the Sponsor or third parties; or b) any
                  prohibited transactions resulting from the provision by the
                  Trustee of Fidelity PortfolioPlanner.

         (2)      Amending Section F, COMMUNICATION & EDUCATION SERVICES, of
                  Schedule "A" as follows.

                  2.       Fidelity PortfolioPlanner(SM), an internet-based
                           educational service for participants that generates
                           target asset allocations and model portfolios
                           customized to investment options in the Plan based
                           upon methodology provided by Strategic Advisers,
                           Inc., an affiliate of the Trustee. The Sponsor
                           acknowledges that it has received the ADV Part II for
                           Strategic Advisers, Inc. more than 48 hours prior to
                           executing the Trust amendment.

<PAGE>

         IN WITNESS WHEREOF, the Trustee and the Sponsor have caused this Second
Amendment to be executed by their duly authorized officers effective as of the
day and year first above written.

CARAUSTAR INDUSTRIES, INC.                       FIDELITY MANAGEMENT TRUST
                                                 COMPANY

By: /s/ Barry A. Smedstad         4/5/00         By: /s/ Carolyn Redden   5/2/00
    ------------------------------------             ---------------------------
    Barry A.  Smedstad             Date              Vice President        Date
    Vice President Human Resources

                                        2
<PAGE>

                   THIRD AMENDMENT TO TRUST AGREEMENT BETWEEN
                      FIDELITY MANAGEMENT TRUST COMPANY AND
                           CARAUSTAR INDUSTRIES, INC.

         THIS THIRD AMENDMENT, dated as of the first day of May, 2000, by
and between Fidelity Management Trust Company (the "Trustee") and Caraustar
Industries, Inc. (the "Sponsor");

                                   WITNESSETH:

         WHEREAS, the Trustee and the Sponsor heretofore entered into a Trust
Agreement dated October 1, 1999, with regard to the Caraustar Industries, Inc.
Employees' Savings Plan (the "Plan"); and

         WHEREAS, the Trustee and the Sponsor now desire to amend said Trust
Agreement as provided for in Section 13 thereof;

         NOW THEREFORE, in consideration of the above premises, the Trustee and
the Sponsor hereby amend the Trust Agreement effective October 1, 1999 by:

         (1)      Amending Schedule "A" by restating Section E, Government
                  Reporting as follows:

                  1.       Process year-end tax reports for participants -
                           1099R, as well as preparation of Form 5500 in
                           accordance with the procedures set forth in Schedule
                           "A-1" attached hereto.

         (2)      Amending Schedule "B" by adding the following:

                  Signature Ready 5500:                     Fee waived.

         (3)      Adding Schedule "A-1" as attached hereto.

         IN WITNESS WHEREOF, the Trustee and the Sponsor have caused this Third
Amendment to be executed by their duly authorized officers effective as of the
day and year first above written.

CARAUSTAR INDUSTRIES, INC.                     FIDELITY MANAGEMENT TRUST COMPANY

By: /s/ Barry A. Smedstad    4/13/2000         By: /s/ Carolyn Redden   5/2/2000
    ----------------------------------             -----------------------------
                                Date               Vice President         Date

<PAGE>

                                 SCHEDULE "A-1"

                               FORM 5500 SERVICE

Effective for Form 5500, applicable schedules and Summary Annual Report ("SAR")
prepared for plan year ending December 31, 1999 and thereafter, FIIOC
("Fidelity") agrees to provide its Signature Ready Form 5500 Service
("Service"), in accordance with the following:

1.  The Sponsor hereby agrees to:

         a.       If Fidelity's Non-Discrimination Testing ("NDT") services are
                  used, submit NDT data by one and one half (1 1/2) months
                  following the plan's year end, which will be performed
                  pursuant to a separate Non Discrimination Testing Services
                  Agreement;

         b.       If Fidelity did not prepare the plan's prior year Form 5500,
                  submit a copy of the most recent Form 5500 filed with the
                  Internal Revenue Service ("IRS");

         c.       If the plan's assets were transferred to Fidelity at any time
                  during the plan year, submit a draft or final copy of the
                  audited financial statements from the prior recordkeeper;

         d.       Provide Fidelity with complete and accurate plan data in the
                  required format, including a completed plan questionnaire
                  ("Questionnaire") as soon as possible after the plan's year
                  end but which may be no later than the last day of the 8th
                  month following the plan's year-end (assuming a filing
                  extension has been requested);

         e.       In the event that Fidelity has not received all data required
                  to complete a Form 5500 within five and one half (5 1/2)
                  months after the plan year end, the Sponsor hereby authorizes
                  Fidelity to prepare and execute IRS Form 5558 (Application for
                  Extension) on behalf of the Plan Administrator and file Form
                  5558 with the IRS in order to obtain an extension of the
                  filing deadline;

         f.       Review, sign and mail the Form 5500 prepared by Fidelity to
                  the IRS in a timely manner;

         g.       Distribute the SAR to participants and beneficiaries in a
                  timely manner;

         h.       Elect the Service prior to the last day of the plan year for
                  which the Form 5500 would be required; and

         i.       Respond to and provide any other information, requested by
                  Fidelity, related to the Form 5500.

2.  Fidelity hereby agrees to:

         a.       Provide the Sponsor with the Questionnaire within one and
                  one-half (1 1/2) months after the plan's year-end. Fidelity
                  shall have no responsibility for verifying the authenticity
                  or accuracy of the data submitted by the Sponsor on the
                  Questionnaire;

                                       2

<PAGE>

         b.       File Form 5558 to request an extension of time to file Form
                  5500 if all required data is not received from the Sponsor
                  within five and one half (5 1/2) months after the plan's year
                  end, as specified above;

         c.       If all requested information is received later than 8 months
                  after the plan's year-end (assuming a filing extension has
                  been filed), Fidelity will not prepare your company's Form
                  5500. The Plan Sponsor shall be responsible for completing the
                  Form 5500 for filing with the IRS. Fidelity shall not be held
                  responsible for any late fees or penalties for incomplete
                  filings caused by the Sponsor's delay, in the event that
                  Fidelity does not receive the required information within 8
                  month's after the plan's year end;

         d.       Provide the Sponsor with Form 5500 at least ten (10) days
                  prior to the required filing date and SAR at least ten (10)
                  days prior to the required mailing date assuming the plan
                  sponsor has submitted the required documents and has met the
                  filing deadlines as outlined in this agreement, which may be
                  no later than the 8 month following the plan's year end;

         e.       Respond to inquiries from the IRS received by the Sponsor,
                  related to any Form 5500 prepared by Fidelity.

SPONSOR

By: /s/ Barry A. Smedstad       4/13/2000
    --------------------------------------
                                   Date

                                       3
<PAGE>

                   FOURTH AMENDMENT TO TRUST AGREEMENT BETWEEN
                      FIDELITY MANAGEMENT TRUST COMPANY AND
                           CARAUSTAR INDUSTRIES, INC.

         THIS FOURTH AMENDMENT, dated as of the twenty-third day of February,
2001, and effective as noted below, by and between Fidelity Management Trust
Company (the "Trustee") and Caraustar Industries, Inc. (the "Sponsor");

                                   WITNESSETH:

         WHEREAS, the Trustee and the Sponsor heretofore entered into a Trust
Agreement dated October 1, 1999, with regard to the Caraustar Industries, Inc.
Employees' Savings Plan (the "Plan"); and

         WHEREAS, the Trustee and the Sponsor now desire to amend said Trust
Agreement as provided for in Section 13 thereof;

         NOW THEREFORE, in consideration of the above premises, the Trustee and
the Sponsor hereby amend the Trust Agreement by:

         (1)      Amending the "money classifications" portion of Schedule "A"
                  by adding the following, effective February 23, 2001:

                  -   Employer Contribution

         (2)      Amending Schedule "B" be restating the "Annual Participant
                  Fee" as follows, effective April 1, 2001:

                  Annual Participant Fee:    $36.00 per participant*, billed and
                                             payable quarterly.

         (3)      Amending Schedule "B" by restating the Note section, as
                  follows, effective April 1, 2001:

                  Note: These fees have been negotiated and accepted based on
                  the following Plan characteristics: 1 plan in the
                  relationship, current plan assets of $56.2 million, current
                  participation of 3,352 participants, current stock assets of
                  $7.9 million, total Fidelity actively managed Mutual Fund
                  assets of $44.3 million, total Fidelity non-actively managed
                  Mutual Fund assets of $1.1 million, total FundsNet/Outside
                  Fund assets of $2.9 million and projected net cash flows of
                  $6.496 million per year. Fees will be subject to revision if
                  these Plan characteristics change significantly by either
                  falling below or exceeding current or projected levels. Fees
                  also have been based on the use of up to 17 investment
                  options, and such fees will be subject to revision if
                  additional investment options are added.

<PAGE>

         IN WITNESS WHEREOF, the Trustee and the Sponsor have caused this Fourth
Amendment to be executed by their duly authorized officers effective as of the
day and year first above written.

CARAUSTAR INDUSTRIES, INC.                     FIDELITY MANAGEMENT TRUST COMPANY

By: /s/ Barry A. Smedstad     2/15/01          By: /s/ Carolyn Redden     3/2/01
    ---------------------------------              -----------------------------
                               Date                Vice President          Date

                                       2
<PAGE>

                   FIFTH AMENDMENT TO TRUST AGREEMENT BETWEEN
                      FIDELITY MANAGEMENT TRUST COMPANY AND
                           CARAUSTAR INDUSTRIES, INC.

         THIS FIFTH AMENDMENT, dated as of the first day of March, 2001, by and
between Fidelity Management Trust Company (the "Trustee") and Caraustar
Industries, Inc. (the "Sponsor");

                                   WITNESSETH:

         WHEREAS, the Trustee and the Sponsor heretofore entered into a Trust
Agreement dated October 1, 1999, with regard to the Caraustar Industries, Inc.
Employees' Savings Plan (the "Plan"); and

         WHEREAS, the Trustee and the Sponsor now desire to amend said Trust
Agreement as provided for in Section 13 thereof;

         NOW THEREFORE, in consideration of the above premises, the Trustee and
the Sponsor hereby amend the Trust Agreement by:

         Amending the "money classifications" portion of Schedule "A" by adding
         the following, effective February 23, 2001:

                  -        Prior Plan Profit Sharing

         IN WITNESS WHEREOF, the Trustee and the Sponsor have caused this Fifth
Amendment to be executed by their duly authorized officers effective as of the
day and year first above written.

CARAUSTAR INDUSTRIES, INC.                     FIDELITY MANAGEMENT TRUST COMPANY

By: /s/ Barry A. Smedstad     2/22/01          By: /s/ Carolyn Redden    3/14/01
    ---------------------------------              -----------------------------
                               Date                Vice President          Date

<PAGE>

                   SIXTH AMENDMENT TO TRUST AGREEMENT BETWEEN
                      FIDELITY MANAGEMENT TRUST COMPANY AND
                           CARAUSTAR INDUSTRIES, INC.

         THIS SIXTH AMENDMENT, dated as of the 1st day of June, 2001, by and
between Fidelity Management Trust Company (the "Trustee") and Caraustar
Industries, Inc. (the "Sponsor");

                                   WITNESSETH:

         WHEREAS, the Trustee and the Sponsor heretofore entered into a Trust
Agreement dated October 1, 1999, with regard to the Caraustar Industries, Inc.
Employees' Savings Plan (the "Plan"); and

         WHEREAS, the Trustee and the Sponsor now desire to amend said Trust
Agreement as provided for in Section 13 thereof;

         NOW THEREFORE, in consideration of the above premises, the Trustee and
the Sponsor hereby amend the Trust Agreement by:

         (1)      Amending the "investment options" section of Schedules "A"
                  and "C", to add the following:

                  - MSDW Institutional Fund, Inc. - Small Company Growth
                  Portfolio - Class B

         IN WITNESS WHEREOF, the Trustee and the Sponsor have caused this Sixth
Amendment to be executed by their duly authorized officers effective as of the
day and year first above written.

CARAUSTAR INDUSTRIES, INC.                     FIDELITY MANAGEMENT TRUST
                                               COMPANY

By: /s/ Barry A. Smedstad     5/12/01          By: /s/ Carolyn Redden    6/11/01
    ---------------------------------              -----------------------------
                               Date                Vice President          Date

<PAGE>

                  SEVENTH AMENDMENT TO TRUST AGREEMENT BETWEEN
                      FIDELITY MANAGEMENT TRUST COMPANY AND
                           CARAUSTAR INDUSTRIES, INC.

         THIS SEVENTH AMENDMENT, dated as of the first day of July, 2001, by and
between Fidelity Management Trust Company (the "Trustee") and Caraustar
Industries, Inc. (the "Sponsor");

                                   WITNESSETH:

         WHEREAS, the Trustee and the Sponsor heretofore entered into a Trust
Agreement dated October 1, 1999, with regard to the Caraustar Industries, Inc.
Employees' Savings Plan (the "Plan"); and

         WHEREAS, the Trustee and the Sponsor now desire to amend said Trust
Agreement as provided for in Section 13 thereof;

         NOW THEREFORE, in consideration of the above premises, the Trustee and
the Sponsor hereby amend the Trust Agreement by:

         (1)      Amending the "Other" section of Schedule "A" by adding the
                  following paragraph:

                  4.       Enroll new participants via Auto-Enrollment, using
                           eligibility criteria and a deferral rate determined
                           by the Sponsor and communicated to the Trustee in
                           writing.

         (2)      Amending and restating the second paragraph of Schedule "C" to
                  read as follows:

                  The Named Fiduciary hereby directs that for Plan assets
                  allocated to a participant's account, the investment option
                  referred to in Section 4(c) shall be the Fidelity Freedom Fund
                  determined according to a methodology selected by the Named
                  Fiduciary and communicated to the Trustee in writing. In the
                  case of unallocated Plan assets, the termination or
                  reallocation of an investment option, or Plan assets described
                  in Section 4(e)(v)(B)(5), the Plan's default investment shall
                  be Fidelity Freedom Income Fund(R).

         IN WITNESS WHEREOF, the Trustee and the Sponsor have caused this
Seventh Amendment to be executed by their duly authorized officers effective as
of the day and year first above written.

CARAUSTAR INDUSTRIES, INC.                     FIDELITY MANAGEMENT TRUST
                                               COMPANY

By: /s/ Barry A. Smedstad      6/7/01          By: /s/ Carolyn Redden    7/11/01
    ---------------------------------              -----------------------------
                               Date                Vice President          Date

<PAGE>

[LOGO]                                                     FREEDOM FUND DEFAULT

AVAILABLE SERVICE OPTIONS (PLEASE COMPLETE ALL SECTIONS BELOW)

A.       FREEDOM FUND DEFAULT FOR PARTICIPANTS WITH A VALID DATE OF BIRTH

         The Plan Sponsor must direct Fidelity regarding the methodology for
         applying the Freedom Funds by DOB. The Fidelity suggested allocation is
         based on the Freedom Funds' objectives as described in the Funds'
         Prospectus. However, the methodology appropriate for your Plan may be
         different based on the needs of your participants.

<TABLE>
         <S>                                           <C>
         X FIDELITY SUGGESTED DOBS (SEE BELOW)         [ ] PLAN SPONSOR DIRECTED DOBS (PLEASE PROVIDE BELOW)
</TABLE>

<TABLE>
<CAPTION>
FUND NAME                      RETIREMENT DATE RANGE                 FIDELITY DOB RANGE                   PLAN SPONSOR PROVIDED
---------                      ---------------------                 ------------------                   ---------------------
<S>                            <C>                                   <C>                                  <C>
Freedom Income(R)               Retired before 2000                  1/1/1900-12/31/1934

Freedom 2000(R)                   2000 - 2005                        1/1/1935-12/31/1940

Freedom 2010(R)                   2006 - 2015                        1/1/1941-12/31/1950

Freedom 2020(R)                   2016 - 2025                        1/1/1951-12/31/1960

Freedom 2030(R)                   2026 - 2035                        1/1/1961-12/31/1970

Freedom 2040(SM)                  2036 - 2045                        1/1/1971-12/31/1980
</TABLE>

B.       FREEDOM FUND DEFAULT FOR PARTICIPANTS WITH AN INVALID DATE OF BIRTH

         X Please use the Freedom Income Fund [ ] Other Fund:
                                                              __________________

C.       PARTICIPANT NOTIFICATION

         X Send Standard notification letters (see enclosure)

         [ ] Send Custom notification letters (maximum 25 lines, 75 characters
             each, including spaces)}

D.       SOURCES OF MONEY

         X  All Sources of Money, except

Fidelity Investments Institutional Operations Company, Inc. is hereby directed
to apply the Freedom Fund Default service for the following plan(s) in
accordance with the criteria and procedures described above.

Name: Nan Mays
      --------------------------------------------------

Signature: /s/ Nan Mays              Date:    6-7-01
           -------------------------       -------------

Plan Name: Caraustar Employees' Savings Plan
           ---------------------------------------------

Plan Number(s): 37786
                ----------------------------------------

The Direction Form must be executed by an individual who is an authorized
signatory under the Trust or Recordkeeping Agreement.

Please retain a copy of this Direction Form for your records.

FIDELITY INVESTMENTS INSTITUTIONAL OPERATIONS COMPANY, INC., 82 DEVONSHIRE ST.,
BOSTON, MA 02109

<PAGE>

[LOGO]                                                      FREEDOM FUND DEFAULT

FIDELITY FREEDOM FUND DEFAULT SERVICE DIRECTION FORM

THE FIDELITY FREEDOM FUND DEFAULT SERVICE CONSISTS OF TWO FEATURES:

         PARTICIPANT NOTIFICATION

         -        After service initiation and upon initial contribution to the
                  default fund, participants are notified that investment
                  directions have not been received and that contributions are
                  being directed to the plan default fund.
         -        A follow-up notification is sent to participants after 45 days
                  and subsequent defaulted contribution

         FIDELITY FREEDOM FUND DEFAULT

         -        Automatically invests contributions and loan repayments for
                  which a participant has not provided investment directions
                  into a Fidelity Freedom Fund based on the participant's age
                  according to the methodology directed by the Plan Sponsor.
         -        Automatically defaults new contributions for participants
                  without a valid date of birth into the Fidelity Freedom Income
                  Fund or other default fund chosen by Plan Sponsor<PAGE>

                                                                    Exhibit 10.4

                             ABERCROMBIE & FITCH CO.
                         2002 STOCK PLAN FOR ASSOCIATES
                     (as amended and restated May 22, 2003)

1.       PURPOSE

The purpose of the Abercrombie & Fitch Co. 2002 Stock Plan for Associates (the
"Plan") is to promote the interests of Abercrombie & Fitch Co. (the "Company")
and its stockholders by allowing the Company to attract and retain the best
available associates for itself and its subsidiaries and to encourage the
highest level of performance by such associates. The Plan is expected to
contribute to the attainment of these objectives by offering eligible associates
the opportunity to acquire shares of Class A Common Stock, par value $0.01 per
share ("Shares"), of the Company, and other rights with respect to Shares of the
Company and to thereby provide them with incentives to put forth maximum efforts
for the success of the Company and its subsidiaries. Eligible associates may be
granted options to purchase Shares of the Company, Shares which are restricted
as provided in Section 6 of this Plan ("Restricted Shares") and stock units,
each representing the right to receive one Share as described in Section 7 of
this Plan ("Stock Units").

2.       ADMINISTRATION

The Plan shall be administered by a committee (the "Committee") appointed by the
Company's Board of Directors (the "Board") and consisting of not less than two
(2) members of the Board. Subject to the provisions of the Plan, the Committee
shall be authorized to interpret the Plan; to establish, amend and rescind any
rules and regulations relating to the Plan; and to make all determinations
necessary or advisable for the administration of the Plan. In addition, subject
to the provisions of the Plan, the Committee shall have the power and authority
(a) to grant options and to determine the eligible associates to whom such
options will be granted, the purchase price of the Shares covered by each
option, the term of each option, the number of Shares covered by each option,
the vesting schedule applicable to each option and such other terms and
conditions pertaining to each option as the Committee may deem appropriate; (b)
to grant Restricted Shares and to determine the eligible associates to whom such
Restricted Shares will be granted, the number of Restricted Shares covered by
each grant, the duration of the restricted period applicable to the Restricted
Shares and such other terms, conditions and restrictions applicable to each
grant of Restricted Shares as the Committee may deem appropriate; and (c) to
grant Stock Units and to determine the eligible associates to whom such Stock
Units will be granted, the number of Stock Units covered by each grant, the
vesting schedule applicable to each Stock Unit and such other terms and
conditions pertaining to each Stock Unit as the Committee may deem appropriate.
The determinations of the Committee in the administration of the Plan, as
described herein, shall be final and conclusive. Any officer of the Company
shall be authorized to implement the Plan in accordance with its terms and to
take such actions of a ministerial nature as shall be necessary to effectuate
the intent and purposes thereof. The validity, construction and effect of the
Plan and any rules and regulations relating to the Plan shall be determined in
accordance with the laws of the State of Delaware.

3.       ELIGIBILITY

The class of individuals eligible to receive grants of options, Restricted
Shares and/or Stock Units (collectively, "Awards") under the Plan, shall be
associates of the Company or its subsidiaries ("Eligible Associates"). Any
holder of an Award granted under the Plan shall hereinafter be referred to as a
"Participant."

                                       31

<PAGE>

4.       SHARES SUBJECT TO THE PLAN

(a)      Subject to adjustment as provided in Section 9, the maximum number of
Shares that may be delivered to Participants and their beneficiaries under the
Plan shall be 7,000,000 Shares. The Shares to be delivered under the Plan may
consist of either Shares currently held or Shares subsequently acquired by the
Company as treasury Shares, including Shares purchased in the open market or in
private transactions.

(b)      In the event that prior to the date the Plan shall terminate in
accordance with Section 12, any Award granted under the Plan expires unexercised
or unvested or is terminated, surrendered or cancelled without the delivery of
Shares, or any Restricted Shares are forfeited back to the Company, then the
Shares subject to such Award may be made available for subsequent Awards under
the terms of the Plan. To the extent that any Shares covered by an Award are not
delivered to a Participant or beneficiary because the Award is settled in cash
or used to satisfy any applicable tax withholding obligation, such Shares shall
not be deemed to have been delivered for purposes of determining the maximum
number of Shares available for delivery under this Plan. If the exercise price
of any option granted under the Plan is satisfied by tendering already owned
Shares to the Company (either by actual delivery or by attestation), only the
number of Shares issued net of the Shares tendered shall be deemed delivered for
purposes of determining the maximum number of Shares available for delivery
under this Plan.

5.       GRANT, TERMS AND CONDITIONS OF OPTIONS

(a)      The Committee, in its sole discretion, shall select from among the
Eligible Associates the individuals to whom options to purchase Shares are to be
granted under this Plan. Options shall be granted in such form and upon such
terms and conditions, as the Committee shall from time to time determine.

(b)      The options granted under this Plan shall be nonstatutory stock options
not intended to qualify under Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code"), and shall have the following terms and conditions:

(i)      Exercise Price. The purchase price per Share deliverable upon the
exercise of each option shall be 100% of the Fair Market Value per Share on the
date the option is granted. For purposes of this Plan, Fair Market Value shall
be the "closing price" of the Shares as reported on the principal exchange on or
through which the Shares are listed or traded for the date in question, or if
there were no sales on such date, the most recent prior date on which there were
sales.

(ii)     Exercisability and Term of Options. Each option granted under the Plan
shall become exercisable pursuant to a vesting schedule, as determined by the
Committee, to be included in the option agreement described in paragraph (vi).
Subject to the provisions of Sections 5(c) and 5(d), once vested and
exercisable, each option granted under the Plan shall remain exercisable until
the earlier of (A) ten years from the date of grant and (B) the expiration of
the period described in paragraph (iv) below.

(iii)    Exercise and Payment. An option granted under this Plan may be
exercised, in whole or in part, at such time or times as the Committee shall
determine. The Committee may, in its discretion, accelerate the exercisability
of any option at any time. Options may be exercised by a Participant by giving
written notice to any individual or individuals designated from time to time by
the Committee stating the number of Shares with respect to which the option is
being exercised and tendering payment therefor. The Committee shall develop
procedures through which a Participant may pay an option's exercise price,
including tendering Shares the Participant already owns, either by actual
delivery of the previously acquired Shares or by attestation, valued at the Fair
Market Value of the Shares on the exercise date, as partial or full payment of
the exercise price. As soon as reasonably practicable following such exercise,
the Shares purchased shall be registered in the name of the Participant.

                                       32

<PAGE>

(iv)     Termination of Service as Eligible Associate. Subject to the provisions
of Sections 5(c) and 5(d), upon termination of a Participant's service as an
associate of the Company and its subsidiaries for any reason, all outstanding
options held by such Participant, to the extent then vested and exercisable,
shall remain exercisable in whole or in part for the time period specified in
the agreement described in paragraph (vi) or otherwise provided at any time by
the Committee; provided that in no event shall the options be exercisable after
the tenth anniversary of the date of their grant.

(v)      Nontransferability of Options. No option may be assigned, alienated,
pledged, attached, sold or otherwise transferred, encumbered or disposed of by a
Participant otherwise than by will or the laws of descent and distribution, and
during the lifetime of the Participant to whom an option is granted, it may be
exercised only by the Participant or by the Participant's guardian or legal
representative. Notwithstanding the foregoing, options may be transferred
pursuant to a qualified domestic relations order, as defined in Section 414(p)
of the Code or any successor provision.

(vi)     Option Agreement. Each option granted under this Plan shall be
evidenced by an agreement with the Company which shall contain the terms and
conditions of the option and shall otherwise be consistent with the provisions
of this Plan.

(c)      Death of Participant. Notwithstanding the provisions of paragraphs (ii)
and (iv) of Section 5(b) of this Plan, if a Participant should die while
employed by the Company or one of its subsidiaries or within three months after
the termination of such employment, all outstanding options held by such
Participant (whether or not then exercisable by their terms) shall become
immediately vested and exercisable in full by the Participant's estate or by the
person who acquires the right to exercise such options upon the Participant's
death by bequest or inheritance. Such exercise may occur at any time within one
year after the date of the Participant's death or such other period as the
Committee may at any time determine, provided that in no event shall any option
of a deceased Participant be exercisable after the tenth anniversary of the date
of its grant.

(d)      Total Disability of Participant. Notwithstanding the provisions of
paragraphs (ii) and (iv) of Section 5(b) of this Plan, if a Participant's
employment with the Company and its subsidiaries ceases as a result of the
Participant's becoming totally disabled, all outstanding options held by such
Participant (whether or not then exercisable by their terms) shall become
immediately vested and exercisable in full. Such exercise may occur at any time
during the first nine months that the Participant receives benefits under the
Abercrombie & Fitch Co. Long-Term Disability Program or any successor plan or
program (the "Disability Plan"); provided that, in no event shall the options of
a totally disabled Participant be exercisable after the tenth anniversary of the
date of their grant. For purposes of this Plan, "total disability" shall have
the definition set forth in the Disability Plan, which definition is hereby
incorporated by reference.

(e)      Change of Control. Upon the occurrence of a Change of Control, all
outstanding options held by Participants (whether or not then exercisable by
their terms) shall become immediately vested and exercisable in full. For
purposes of this Plan, the term "Change of Control" shall mean, unless otherwise
defined in an Award agreement, an occurrence of a nature that would be required
to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A under
the Securities Exchange Act of 1934 (the "Exchange Act") or any successor rule
or regulation. Without limiting the inclusiveness of the definition in the
preceding sentence, a Change of Control of the Company shall be deemed to have
occurred as of the first day that any one or more of the following conditions is
satisfied: (i) any person is or becomes the "beneficial owner" (as defined in
Rule 13d-3 under the Exchange Act or any successor rule or regulation), directly
or indirectly, of securities of the Company representing 20% or more of the
combined voting power of the Company's then outstanding securities and such
person would be deemed an

                                       33

<PAGE>

"Acquiring Person" for purposes of the Rights Agreement dated as of July 16,
1998, as amended (the "Rights Agreement"), to which the Company and National
City Bank, as successor Rights Agent, are parties; or (ii) any of the following
occur: (A) any merger or consolidation of the Company, other than a merger or
consolidation in which the voting securities of the Company immediately prior to
the merger or consolidation continue to represent (either by remaining
outstanding or by being converted into securities of the surviving entity) 80%
or more of the combined voting power of the Company or surviving entity
immediately after the merger or consolidation with another entity; (B) any sale,
exchange, lease, mortgage, pledge, transfer or other disposition (in a single
transaction or a series of related transactions) of assets or earning power
aggregating more than 50% of the assets or earning power of the Company and its
subsidiaries on a consolidated basis; (C) any complete liquidation or
dissolution of the Company; (D) any reorganization, reverse stock split or
recapitalization of the Company that would result in a Change of Control as
otherwise defined in this Plan; or (E) any transaction or series of related
transactions having, directly or indirectly, the same effect as any of the
foregoing.

6.       GRANT, TERMS AND CONDITIONS OF RESTRICTED SHARES

(a)      The Committee, in its sole discretion, shall select from among the
Eligible Associates the individuals to whom Restricted Shares are to be granted
under this Plan. Restricted Shares shall be granted subject to such
restrictions, conditions and other terms as the Committee shall from time to
time determine. At the time a grant of Restricted Shares is made, the Committee
shall determine the duration of the period (the "Restricted Period") during
which, and the conditions under which, the Restricted Shares shall vest and no
longer be subject to forfeiture to the Company. The Committee may, in its
discretion, at the time a grant of Restricted Shares is made, prescribe
restrictions in addition to or other than the expiration of the Restricted
Period, including the satisfaction of corporate or individual performance
objectives which may be applicable to all or any portion of the Restricted
Shares.

(b)      The Restricted Shares granted under this Plan shall have the following
terms and conditions:

(i)      Nontransferability of Restricted Shares. Restricted Shares may not be
assigned, alienated, pledged, attached, sold or otherwise transferred,
encumbered or disposed of during the applicable Restricted Period or prior to
the satisfaction of any other restrictions prescribed by the Committee with
respect to such Restricted Shares. Notwithstanding the foregoing, Restricted
Shares may be transferred pursuant to a qualified domestic relations order, as
defined in Section 414(p) of the Code or any successor provision.

(ii)     Termination of Service as Eligible Associate. Except as the Committee
may at any time provide, any Restricted Shares granted to a Participant pursuant
to this Plan shall be forfeited if the Participant terminates employment with
the Company and its subsidiaries for any reason other than death or total
disability prior to the expiration or termination of the applicable Restricted
Period and the satisfaction of any other conditions applicable to such
Restricted Shares. Upon such forfeiture, the Chief Operating Officer, the Chief
Financial Officer or the Secretary of the Company shall cause the Restricted
Shares that are forfeited to the Company to be either cancelled or retained as
treasury Shares. If a Participant shall die while employed by the Company or any
of its subsidiaries or if a Participant's employment with the Company and its
subsidiaries ceases as a result of the Participant's becoming totally disabled,
all restrictions and conditions applicable to the Restricted Shares held by the
Participant shall immediately lapse. Upon the retirement of a Participant, the
Committee may, in its sole discretion, shorten or terminate the Restricted
Period or waive any other restrictions or conditions applicable to all or a
portion of the Restricted Shares granted to such Participant.

(iii)    Change of Control. Upon the occurrence of a Change of Control, all
restrictions and conditions applicable to the Restricted Shares held by
Participants shall immediately lapse.

                                       34

<PAGE>

(iv)     Award Agreement. Each grant of Restricted Shares under this Plan shall
be evidenced by an agreement with the Company which shall contain the terms and
conditions of the Restricted Shares and shall otherwise be consistent with the
provisions of this Plan.

(c)      If the Committee deems it necessary or appropriate, the Company may
issue, in the name of each Participant to whom Restricted Shares have been
granted, one or more stock certificates representing the total number of
Restricted Shares granted to the Participant; provided that such stock
certificates bear an appropriate legend or other restriction on transfer. The
Chief Operating Officer, the Chief Financial Officer or the Secretary of the
Company shall hold such stock certificates, properly endorsed for transfer, for
the Participant's benefit until such time as the Restricted Shares are forfeited
to the Company, or the applicable Restricted Period expires and any other
conditions applicable to the Restricted Shares are satisfied.

(d)      Except as determined by the Committee either at the time Restricted
Shares are granted or at any time thereafter prior to the lapse of the
applicable restrictions, holders of Restricted Shares shall not have the right
to vote such Restricted Shares or the right to receive any dividends with
respect to such Restricted Shares. All distributions, if any, received by a
Participant with respect to Restricted Shares as a result of any split-up,
distribution, combination of shares, or other similar transaction affecting the
Shares, shall be subject to the restrictions of this Section 6.

(e)      Upon the expiration or termination of the applicable Restricted Period
and the satisfaction of any other conditions prescribed by the Committee, the
restrictions applicable to the Restricted Shares shall lapse and a stock
certificate for or other appropriate documentation evidencing the number of
Restricted Shares with respect to which the restrictions have lapsed shall be
delivered, free of all such restrictions, to the Eligible Associate or the
Eligible Associate's beneficiary or estate, as the case may be.

7.       GRANT, TERMS AND CONDITIONS OF STOCK UNITS

(a)      The Committee, in its sole discretion, shall select from among the
Eligible Associates the individuals to whom Stock Units are to be granted under
this Plan. Each Stock Unit shall represent the right to receive one Share. At
the time a grant of a Stock Unit is made, the Committee shall determine the
conditions under which such Stock Unit shall vest and the Share covered thereby
delivered to the holder of the Stock Unit.

(b)      The Stock Units granted under this Plan shall have the following terms
and conditions:

(i)      Nontransferability of Stock Units. No Stock Units may be assigned,
alienated, pledged, attached, sold or otherwise transferred, encumbered or
disposed of by a Participant otherwise than by will or the laws of descent and
distribution. Notwithstanding the foregoing, Stock Units may be transferred
pursuant to a qualified domestic relations order, as defined in Section 414(p)
of the Code or any successor provision.

(ii)     Termination of Service as Eligible Associate. Except as the Committee
may at any time provide, upon termination of a Participant's service as an
associate of the Company and its subsidiaries for any reason other than death or
total disability, all outstanding Stock Units held by such Participant which
shall not have vested shall be forfeited by the Participant.

(iii)    Death of Participant. If a Participant should die while employed by the
Company or one of its subsidiaries, all outstanding Stock Units held by such
Participant (whether or not then vested by their terms) shall become immediately
vested in full and the Shares subject thereto deliverable to the Participant's
estate or the person who acquires the right to receive such Shares upon the
Participant's death by bequest or inheritance.

(iv)     Total Disability of Participant. If a Participant's employment with the
Company and its subsidiaries ceases as a result of the Participant's becoming
totally disabled, all outstanding Stock Units held by such Participant (whether
or not then vested by their terms) shall become immediately vested in full and
the Shares subject thereto deliverable to the Participant.

                                       35

<PAGE>

(v)      Change of Control. Upon the occurrence of a Change of Control, all
outstanding Stock Units held by Participants (whether or not then vested by
their terms) shall become immediately vested in full and the Shares subject
thereto deliverable to the Participants.

(vi)     Award Agreement. Each Stock Unit granted under this Plan shall be
evidenced by an agreement with the Company which shall contain the terms and
conditions of the Stock Unit and shall otherwise be consistent with the
provisions of this Plan.

8.       TAX WITHHOLDING

(a)      The Company will withhold from other amounts owed to a Participant, or
require the Participant to remit to the Company, an amount sufficient to satisfy
any applicable federal, state and local withholding tax requirements on any
Award under the Plan, exercise or cancellation of an Award or purchase of
Shares. If any such amounts are not to be withheld from other payments due to
the Participant, the Company will defer the issuance of Shares until the earlier
of:

         (i)      Thirty days after the settlement date; or

         (ii)     The date the Participant remits the required amount.

(b)      If the Company has been unable to satisfy any tax withholding
obligations which the Company may have pursuant to Section 8(a) above, in its
discretion, the Committee may allow a Participant to elect, subject to
conditions the Committee establishes, to reimburse the Company for this tax
withholding obligation through one or more of the following methods:

(i)      By having Shares otherwise issuable under the Plan withheld by the
Company (but only to the extent of the minimum amount that must be withheld to
comply with applicable state, federal and local income, employment and wage tax
laws);

         (ii)     By delivering to the Company previously acquired Shares;

         (iii)    By remitting cash to the Company; or

         (iv)     By remitting a personal check immediately payable to the
                  Company.

9.       ADJUSTMENT AND CHANGES IN SHARES

If, after the Effective Date, there is a Share dividend or Share split,
recapitalization (including payment of an extraordinary dividend), merger,
consolidation, combination, spin-off, distribution of assets to stockholders,
exchange of shares, or other similar corporate change affecting the Shares, the
Committee shall appropriately adjust (a) the aggregate number of Shares
available for Awards under the Plan or subject to outstanding Awards, (b) the
respective exercise price, number of Shares and other limitations applicable to
outstanding Awards, and (c) any other factors, limits or terms affecting any
outstanding Awards.

10.      PLAN AMENDMENT AND TERMINATION

The Board may suspend, terminate, modify or amend the Plan at any time, as it
shall deem advisable or to conform to any change in any law or regulation
applicable thereto; provided that no such action shall be taken without
stockholder approval to the extent stockholder approval is required to satisfy
applicable requirements imposed by (a) Rule 16b-3 under the Exchange Act, or any
successor rule or regulation; (b) applicable requirements of the Code; or (c)
the rules of any exchange on or through which the Shares are then listed or
traded. If the Plan is terminated, the terms of the Plan shall, notwithstanding
such termination, continue to apply to Awards granted prior to such termination.
No suspension, termination, modification or amendment of the Plan may, without
the consent of the Participant to whom an Award shall theretofore have been
granted, adversely affect the rights of such Participant under such Award.

11.      APPLICABLE LAW AND REGISTRATION

The grant of Awards and the issuance of Shares shall be subject to all
applicable laws, rules and regulations, and to such approvals by any
governmental agencies or national securities exchanges as may be required.
Notwithstanding the foregoing, no Shares shall be issued under the Plan unless
the Company is satisfied that such issuance will be in compliance with
applicable

                                       36

<PAGE>

federal and state securities laws. Shares issued under the Plan may be subject
to such stop transfer orders and other restrictions as the Committee may deem
advisable under the rules, regulations and other requirements of the Securities
and Exchange Commission, any exchange on or through which the Shares are then
listed or traded, or any applicable federal or state securities law. The
Committee may cause a legend or legends to be placed on any certificates
evidencing the Shares to make appropriate reference to restrictions within the
scope of this Section 11 or other provisions of the Plan.

12.      EFFECTIVE DATE AND DURATION OF PLAN

This Plan became effective on January 31, 2002 (the "Effective Date"). The Plan
shall terminate on the day preceding the tenth anniversary of the Effective
Date, unless the Plan is extended or terminated at an earlier date by the Board
or is terminated by exhaustion of the Shares available for issuance hereunder.

                                       37

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