WERNER HOLDING CO INC /PA/
EXHIBIT 10.16
<DOCUMENT>
<TYPE>EX-10.16
<SEQUENCE>4
<FILENAME>l87018aex10-16.txt
<DESCRIPTION>EXHIBIT 10.16
<TEXT>

<PAGE>   1

                                                                   EXHIBIT 10.16

                           SUPPLEMENTAL PENSION PLAN B
                           ---------------------------
                                  APPLICABLE TO
                       ELECTED SALARIED CORPORATE OFFICERS

                                       OF

         WERNER HOLDING CO. (DE), INC., ITS PARENT AND ITS SUBSIDIARIES
                     AMENDED AND RESTATED DECEMBER 31, 2000
                     --------------------------------------

SECTION 1 - PURPOSE:
--------------------

         a)       To recognize unusual dedication, significant additional
                  longevity, superb effort, and outstanding personal
                  contributions of elected salaried Corporate officers.

         b)       To reward deserving elected salaried Corporate officers for
                  outstanding contributions to the Company's growth, success and
                  profits.

         c)       To provide a method to compensate for unusual situations which
                  may develop under the qualified Retirement Plan for Employees
                  of the Company (the "Qualified Pension Plan") due to changes
                  made from time to time in the plan, limitations imposed on the
                  administration of the plan by ERISA, employment past age 65,
                  significant longevity, inflation and other factors.

         d)       To supplement the Company's Qualified Pension Plan with a
                  Supplemental Pension Plan, as hereinafter set forth.

SECTION 2 - ELIGIBILITY:
------------------------

         Effective March 21, 1980, all elected salaried Corporate officers
         actively employed on the Effective Date or elected salaried Corporate
         officers retired prior to the Effective Date and, in both cases, whose
         years of service (N(2)) as an elected salaried Corporate officer were
         at least 10 years.

         Effective January 1, 1986, all elected salaried Corporate officers
         actively employed on the Effective Date, Elected Salaried Corporate
         officers employed after the Effective date, or elected salaried
         Corporate officers retired prior to the Effective Date and, in each
         case, whose years of service (N(2)) as an elected salaried Corporate
         officer were at least 10 years.

         Effective January 1, 1989, eligibility shall be further subject to
         periodic specific designation by the Board of Directors of the Company
         of the individual employee involved.

         Effective January 1, 1992, eligibility for the Inflation Adjustment
         shall be limited to those retired elected salaried corporate officers
         participating in this Supplemental Pension Plan B who have also served
         as a corporate director of Werner Holding Co. (DE), Inc., its parent or
         its subsidiaries for an aggregate length of total directorship service
         of not less




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      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

         than ten years. Service as either an inside director (ie, while as
         corporate employee) or an outside director shall satisfy this
         requirement.

         For the purpose of this Supplemental Pension Plan, elected salaried
         Corporate officers shall be defined as those individuals who have held
         or hold the positions of Chairman or Vice-Chairman of the Board of
         Directors, President, any Corporate Vice-President, but shall not
         include any Assistant Vice-Presidents, Secretaries or Assistant
         Secretaries, Treasurers or Assistant Treasurers or any
         Non-Corporate-Level Vice-Presidents. Applicable service with Werner
         Holding Co. (DE), Inc., its parent, Werner Holding Co. (PA), Inc.
         and/or any of its subsidiaries shall satisfy the appropriate service
         requirement provided, however, that each participating subsidiary must
         adopt this Plan first. Service credit earned with different
         participating companies shall be aggregated together to satisfy the
         necessary service requirements of the Plan.

SECTION 3 - GENERAL:
--------------------

         a)    The gross pension paid to any elected salaried Corporate officer
               shall consist of any Retirement Benefit earned by the elected
               salaried Corporate officer under the Qualified Pension Plan and
               the supplemental pension granted that individual hereunder.

         b)    The Retirement Benefit shall be paid to the elected salaried
               Corporate officer by the Affiliated National Bank-Boulder,
               Boulder, Colorado, or any successor trustee, in accordance with
               the Qualified Pension Plan.

         c)    Except as hereafter provided otherwise, the supplemental pension
               shall be paid directly to the elected salaried Corporate officer
               by the Company. This Supplemental Pension Plan is an unfunded
               plan of deferred compensation, and the benefits hereunder shall
               be paid from the general assets of the Company.

         d)    Except as hereafter provided otherwise, the supplemental pension
               shall be paid during the remaining lifetime of the elected
               salaried Corporate officer upon retirement, commencing
               simultaneously with the later of (1) payment of his Retirement
               Benefit under the Qualified Pension Plan or (2) the first of the
               month next following the Effective Date.

               Regardless of whether any other benefit is payable under this
               plan at the time, the additional element of supplemental pension
               (P(5)) payable under subsection (h) of Section 4 shall be payable
               upon a change in control. For this purpose, a change in control
               of the Company will be considered to have occurred if the board
               of directors of the Company approves the sale or other
               disposition of all or substantially all of the value of the
               assets of the Company unless, following such sale or disposition,
               a




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      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

               majority of the members of the board of directors of the
               acquiring entity is composed of individuals who were members of
               the board of directors of the Company before the sale or
               disposition. A change in control of the employer will also be
               considered to have occurred if on any date a majority of the
               members of the board of directors of the Company were not members
               of the board of directors of the Company on the date one year
               before. A change in control will also be considered to have
               occurred if the stock of the Company is sold in an initial public
               offering. As used in this paragraph, the "Company" includes not
               only Werner Holding Co. (DE), Inc. but also any related entity
               representing all or substantially all of the value of the
               Company.

         e)    In the event that an elected salaried Corporate officer dies
               while in the employ of the Company and prior to his retirement,
               that portion of the supplemental pension related to the full
               benefit supplement (P(3)) shall be paid to his spouse or
               appropriate beneficiaries.

         f)    For each month that the individual remains eligible hereunder,
               one-twelfth (1/12) of the yearly amount of the supplemental
               pension shall be paid on the first business day of that month,
               during the lifetime of the pensioner.

         g)    Except as provided in Section 13 hereof, the supplemental pension
               shall terminate with the payment for the month in which the death
               of the pensioner occurs.

         h)    In the case of a supplemental pension payable because of the
               elected salaried Corporate officer's early retirement, the
               supplemental pension hereunder shall be actuarially reduced to
               reflect commencement prior to normal retirement under the
               Qualified Pension Plan. Such actuarial reduction shall be at a
               rate which is one-half (1/2) of the rate of actuarial reduction
               applicable under the Qualified Pension Plan in the case of such
               early retirement.

         i)    In the case of a supplemental pension payable because of the
               elected salaried Corporate officer's disability retirement, there
               shall be no actuarial reduction of the supplemental pension
               hereunder to reflect commencement prior to normal retirement
               under the Qualified Pension Plan. The payment of supplemental
               pension benefits in the case of a disability retirement shall
               continue only so long as the otherwise eligible individual
               continues to be disabled, as determined under the Qualified
               Pension Plan.

         j)    Supplemental pension benefits shall not be contingent upon any
               pensioner performing any consulting services for the Company
               after retirement, nor shall any pensioner be required to do so.



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      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

         k)    To be eligible for a supplemental pension, and to maintain
               continued eligibility, under this Supplemental Pension Plan, each
               elected salaried Corporate officer shall execute and comply with
               the terms of a Non-Compete Agreement in the form attached hereto
               as Exhibit A. Non-compliance with the terms of the Non-Compete
               Agreement, as determined by the Board of Directors, shall result
               in the loss of all benefits hereunder.

         l)    In the event a retired elected salaried Corporate officer again
               becomes an employee of the Company, such person's benefit
               payments hereunder shall be suspended for the duration of such
               re-employment. Upon subsequent retirement, the benefit payments
               hereunder shall be recomputed to give credit for such period of
               re-employment and the compensation earned during such
               re-employment. Provided, however, that, (except in the case of an
               individual returning from disability retirement, unless such
               subsequent retirement is again because of disability) if such
               recomputation would result in the payment of a lesser benefit
               than the benefit which was suspended, the benefit which was
               suspended will again be payable upon subsequent retirement.

               Provided, further, that the benefit of an elected salaried
               Corporate officer whose benefit prior to re-employment had been
               paid in a joint and survivor option form shall continue to be
               paid in such form upon subsequent retirement. In the event such
               elected salaried Corporate officer dies while re-employed and
               prior to subsequent retirement, his spouse shall be eligible to
               receive the survivor benefit she would have received under the
               joint and survivor option previously in effect as if the elected
               salaried Corporate officer's subsequent retirement had occurred
               on his date of death. However, in the event such elected salaried
               Corporate officer's spouse dies prior to his subsequent
               retirement, upon subsequent retirement his recomputed benefit
               will be paid in the normal form unless he is again married at
               subsequent retirement, in which event the joint and survivor
               option elections will again be available.

         m)    Notwithstanding any other clause herein contained, benefits
               payable under this Plan shall not be duplicated in any way either
               with respect to this Plan or any other Plan funded by the
               Company, its parent, Werner Holding Co. (PA), Inc. or any of its
               subsidiaries.

         n)    Notwithstanding any other clause herein contained, that part of
               the supplemental pension which represents the full benefit
               supplement (P(3)), see Section 4(e), shall be paid to the
               designated beneficiary under the Qualified Pension Plan, if the
               officer is otherwise eligible but dies while in the Company's
               employ rather than after retirement.



                                       4
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      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

         o)    It is intended that the Supplemental Pension Plan be
               appropriately coordinated with the latest version of the
               Qualified Pension Plan. Therefore, in interpreting the
               Supplemental Plan any necessary adjustments to reflect references
               to the latest version of the Qualified Pension Plan shall be
               made. However, the intentions of the Supplemental Plan shall be
               maintained with any questions to be resolved in accordance with
               Section 12.

         p)    A periodic Inflation Adjustment shall be determined in accordance
               with Section 14. Its intent is to appropriately adjust the
               aggregate combined payout under the Qualified Pension Plan and
               this Supplemental Pension Plan to reflect the effects of ongoing
               inflation since retirement.

         q)    The recipients of a Supplemental Pension shall be furnished with
               an explanation of the calculations used to determine their
               payments. The aforesaid information shall be due with their first
               Supplemental Pension check and whenever an adjustment is made to
               reflect any changes contemplated by this Plan. When adjustments
               reflect both ongoing and catch-up payments, this information
               shall be clearly explained.

         r)    To the maximum extent possible, once recipients are advised of
               the amounts due them, the number of monthly Supplemental Pension
               Plan benefit check issued shall be minimized.

SECTION 4 - SUPPLEMENTAL PENSION:
---------------------------------

         a)    A special pension calculation shall be prepared appropriately
               timed to the retirement date of an elected salaried Corporate
               officer using the adjustment factors hereinafter outlined. This
               calculated special pension shall become that individual's
               supplemental pension hereunder.

         b)    The supplemental pension for elected salaried Corporate officers
               shall include:

               (1)  Full service credit at 1.5% for service beyond both pre- and
                    post 35 years (P(1)) - See 4(c).

               (2)   An officership adjustment (P(2)) - See 4(d).

               (3)   A full benefit supplement where benefits under the
                     Qualified Pension Plan are statutorily limited (P(3)) - See
                     4(e).

               (4)   A special service adjustment in the case of disability and
                     early retirements (P(4)) - See 4(f).



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      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

         c)    The Supplemental Pension Plan shall include credit at the rate of
               1.5 % of average earnings (S) for all years of credited service
               beyond 30 years, with no limit to the maximum years of service.
               In contrast, the Qualified Pension Plan provides for credit at
               the rate of 1 % of Covered Compensation (C. C.) and 1.5% of
               average earnings (S) in excess of covered compensation (C.C.) for
               a maximum of 35 years of service plus credit for post 35 years
               service at 1 % of average earnings (S). "Average Earnings",
               "Covered Compensation" and "Credited Service" shall be as defined
               in the Qualified Pension Plan.

               Therefore:

               P(1) = [0.5% x (C.C.)] x N(1B) + [0.5% x (S)] x N (greater
               than 35) = $/Yr.

               N(1B) is equal to or less than N(1) - 30
                                              Where 30 is equal to or less than
                                              N(1) but for these purposes N(1)
                                              is limited to a maximum of 35.

               N (greater than 35) = N(1) - 35    Where N(1) is equal to or
                                                  less than 35 Years Service

         d)    The supplemental pension benefit for elected salaried Corporate
               officers shall include credit at the rate of 0.5 % of average
               annual compensation for the years of service as an elected
               salaried Corporate officer. "Average Annual Compensation" (C) and
               "years of service" as an elected salaried Corporate officer (N2)
               shall be determined using the Company payroll records and
               parallel methods as those for "average earnings" and "credited
               service" as defined in the Qualified Pension Plan.

                           Therefore: P(2) = 0.5 % (C) (N(2)) = $/Yr.

         e)    The supplemental pension benefit shall include a full benefit
               supplement when an elected salaried Corporate officer's benefit
               under the Qualified Pension Plan is limited by any statutorily
               imposed maximum benefit limitation applying to such Plan. The
               full benefit supplement shall be equal to the difference between
               the benefit which would be paid under such Plan without
               application of the maximum benefit limitation and the benefit
               actually being paid under such Plan as a result of application of
               the maximum benefit limitation.

                            Therefore: P(3) = P(E) - P

               The full benefit supplement (P(3)) shall be provided to those
               eligible elected salaried Corporate officers upon their
               retirement or to their beneficiaries in the event of their death
               while in the employ of the Company prior to retirement. The
               purpose of this benefit (P(3)) is to insure that such officers
               receive the full amount of their qualified pension despite the
               limitations imposed by Federal statutes. For purposes of



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      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

               implementation, the beneficiaries shall be those designated by
               the officer under the Qualified Pension Plan, or in the absence
               of such specific designation the rules of said Plan shall apply.

         f)    The supplemental pension for an elected salaried Corporate
               officer who takes a disability retirement or early retirement
               under the terms of the Qualified Pension Plan shall include a
               special service adjustment to recognize the additional years of
               credited service (N(1E)) such person would have had if he would
               have worked until attainment of age sixty-five (65) rather than
               taking disability retirement or early retirement. To be eligible
               the minimum credited service (N(1)) shall be 25 years and the
               minimum service as an elected salaried Corporate officer (N(2))
               shall be 10 years.

                   Therefore: P(4) = [(1% x C.C.) + 1.5% x (S - C.C.)]
                   N(1E) = $/Yr.

                   N(1E) = N(1D) - N(1)

         g)    The total supplemental pension for elected salaried Corporate
               officers (P(so)) shall be the sum of the aforesaid adjustments in
               4(c)-(e), and, where applicable, 4(f), where P(so) = P(1) + P(2)
               + P(3) and, where applicable, + P(4).

         h)    Notwithstanding the foregoing, a minimum supplemental pension
               shall be provided under the Supplemental Pension Plan to Richard
               L. Werner, Robert I. Werner, Donald M. Werner and Howard L. Solot
               by operation of this subsection (h). Under this subsection (h),
               each of the named individuals shall be entitled to an additional
               element of supplemental pension (P(5)) (if any is produced by the
               following formula) in such amount as is necessary to bring the
               total of the pension under the Qualified Pension Plan (P) and the
               pension otherwise payable under the Supplemental Pension Plan
               (P(so)) up to a pension equal to 1.25% of average annual
               compensation while an elected salaried Corporate officer (C) for
               all years of credited service (N(1)), provided that the
               additional element of supplemental pension provided under this
               subsection (h) (P(5)) shall not exceed that amount which, if
               paid in the form of a lump sum under Section 15, would produce
               a lump sum of one million dollars. Subject to the limitation of
               a lump sum equivalent of one million dollars, therefore: P(5) =
               (1.25% x C x N(1)) - P - P(so)

SECTION 5 - FORMULAE & DEFINITIONS:
-----------------------------------

       C -     Average annual compensation for years while an elected salaried
               Corporate officer, based on the same method as used in the
               Qualified Pension Plan which is equal to the three (3)
               consecutive full calendar years out of the last ten (10) full



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      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

               calendar years prior to termination of employment that provide
               the highest average. For these purposes, compensation shall be
               determined using Company payroll records and shall include
               salary, including salary paid in lieu of holiday or vacation,
               bonuses and any other regular compensation payment, but shall not
               include Employee Protection Pay, lump sum payments for consulting
               services or any other taxable income from the Company which is
               required to be reported on the annual W-2 forms to the U.S.
               Government for Federal Income Tax purposes, such as, by way of
               illustration and not limitation, the currently taxable portion of
               any fringe benefit or coverage by a fringe benefit program.

       C.C. -  Covered compensation as defined and established from time to time
               by the Social Security Administration.

       Company - "Company" shall mean Werner Holding Co.(DE), Inc., its parent,
       Werner Holding Co. (PA), Inc. or any participating subsidiary company.
       Any subsidiary which adopts this Plan shall be deemed a participating
       subsidiary company.

       N(1) - Years of credited service as defined in the Qualified Pension
              Plan.

       N (less than 35) - Years of credited service limited to a maximum of
               thirty-five (35) years.

               N (less than 35) = N(1) where N(1) (equal to or less than) 35

       N(1B) - Years of credited service in excess of thirty (30) years and not
               more than thirty-five (35) years.

               N(1B) = N(1) - 30 where 30 (equal to or less than) N(1) but for
               these purposes N(1) is limited to 35
               Otherwise N(1B) = 0

       N (greater than 35) - Years of credited service in excess of thirty-five
               (35) years.

               N (greater than 35) = N(1) - 35 where 35 (equal to or less than)
               N(1)
               Otherwise N (greater than 35) = 0

       N(1D)   - Total years of credited service an elected salaried Corporate
               officer would have had under the Qualified Pension Plan if he had
               worked until attaining age sixty-five (65) rather than taking a
               disability retirement or early retirement.

       N(1E)   - The additional years of credited service an elected salaried
               Corporate office would have had under the Qualified Pension Plan
               if he had worked until attaining age sixty-five (65) rather than
               taking a disability retirement or early retirement.




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      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

                            N(1E) = N(1D) - N(1)

       N(2)-   Years of service as an elected salaried Corporate officer.

       P-      Annual pension benefit payment under the Qualified Pension Plan
               subject to applicable statutorily imposed maximum benefit
               limitation.

               P = (1% x C.C.) x N (less than 35) + 1.5% (S - C.C.) x N (less
               than 35) + (1% x S) x N (greater than 35) = $/Yr. but limited to
               the applicable statutorily imposed maximum benefit limitation
               unde applicable IRS regulations.

       P(1)-   Supplemental pension adjustment to reflect full service
               -maximum 1-1/2 % benefit credit for post thirty (30) and
               thirty-five (35) years service.

                            P(1) = [0.5% x C.C.] x N(1B) + [0.5% x S] x N
               (greater than 35) = $/Yr.

       P(2)-   Supplemental pension adjustment to reflect special credit for
               years of service as an elected salaried Corporate officer.

                            P(2) = 0.5 % (C) (N(2))

       P(3)-   Supplemental pension adjustment to reflect full benefit
               supplement where benefits under the Qualified Pension Plan are
               subject to a statutorily imposed maximum benefit limitation.

                            P(3) = P(E) - P

       P(4)-  = Supplemental pension adjustment to reflect special service
               adjustment for disability retirement or early retirement.

                            P(4) = [1% x C.C.] x N(1E) [1.5% x (S - C.C.)] x
                            N(1E) = $/Yr.

       P(E)-   Annual pension benefit payment under the Qualified Pension Plan
               without regard to the statutorily imposed maximum benefit
               limitation.

               P(E) = (1% x C.C.) x N (less than 35) + [1.5% x (S - C.C.)] x
               N (less than 35) + [1% x S] x N (greater than 35) = Yr.



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      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

                            N (less than 35) = N(1) where N(1) (less than or
                            equal to 35) years service

                            N (greater than 35) = N(1) - 35 where N(1) = years
                            service

       P(so) - Total supplemental pension for elected salaried Corporate
               officers.

                            P(so) = P(1) + P(2) + P(3) and, where applicable
                            P(4)

       S -     Average earnings based on the method used in the Qualified
               Pension Plan using the best three (3) consecutive full years out
               of the last ten (10) years before retirement.

SECTION 6 - CONSULTING ASSIGNMENTS:
-----------------------------------

         a)    From time to time the Company may offer and a pensioner covered
               by this Supplemental Pension Plan may undertake consulting
               assignments.

         b)    The specific assignment, remuneration, and the compensable time
               involved, shall be established as the need arises.

         c)    A pensioner is under no obligation to accept such an assignment,
               but may elect to do so at his option. The acceptance of such an
               assignment shall not affect the right to continue to receive
               benefits hereunder and shall not affect the amount of such
               benefits.

SECTION 7 - NON-COMPETE AGREEMENT:
----------------------------------

         a)    As a condition precedent to the receipt of any benefit payments
               hereunder, an elected salaried Corporate officer shall be
               required to execute and comply with a Non-Compete Agreement in
               the form attached hereto as Exhibit A.

         b)    If the Board of Directors determines that an individual has
               violated any provision of the Non-Compete Agreement, such
               violation will result in the immediate forfeiture of his
               supplemental pension benefits under this Supplemental Pension
               Plan.

SECTION 8 - ACTIONS RESULTING IN FORFEITURE OF RIGHTS AND INTEREST HEREUNDER:
-----------------------------------------------------------------------------

         Notwithstanding any other provision of this Supplemental Pension Plan
         to the contrary, if the Board of Directors determines that any elected
         salaried Corporate officer or former elected salaried Corporate officer
         has committed any act against or infidelity with respect to the
         interests of the Company or has been convicted for the commission of an
         illegal




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      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

         act, all such person's rights and interests in and to any payments
         under this Supplemental Pension Plan shall be terminated and forfeited.

SECTION 9 - EFFECT OF THIS PLAN:
--------------------------------

          a)   Neither the establishment of this Supplemental Pension Plan nor
               the payment of any benefit hereunder shall be construed as giving
               any elected salaried Corporate officer or other person any legal
               or equitable right against the Company, any employee or owner
               thereof, or the Board of Directors, except as specifically
               provided herein.

          b)   Neither the establishment of this Supplemental Pension Plan nor
               the payment of any benefit hereunder shall be construed as a
               contract of continuing employment or give any elected salaried
               Corporate officer or other employee of the Company any right to
               be retained in the service of the Company. Said individuals
               remain subject to discharge or severance to the same extent as if
               this Supplemental Pension Plan were never adopted.

SECTION 10 - AMENDMENT AND TERMINATION:
---------------------------------------

         a)   This Supplemental Pension Plan may be amended from time to time
              and at any time, in whole or in part, by action of the Board of
              Directors. Except as hereinafter provided, any such amendment may
              be made retroactive and any amendment shall be made effective as
              of the date set forth in such amendment; provided, however, that,
              except to the extent specifically set forth in such amendment
              (and then only to the extent necessary to comply with any
              applicable law or to increase a benefit then in pay status), no
              such amendment shall affect any benefit in pay status at the time
              the amendment is adopted.

         b)   This Supplemental Pension Plan may be terminated at any time by
              action of the Board of Directors. No such termination shall affect
              any benefit in pay status at the time the Board of Directors
              approves such termination. However, upon termination of the Plan,
              the Company, at its sole option, shall have the right to make a
              lump sum payment to any pensioner of the actuarial value of the
              future payments of the benefits then in pay status.

         c)   Notwithstanding the foregoing, no amendment or termination adopted
              after a change in control (as described in subsection (d) of
              Section 3) shall have the effect of reducing any benefit under
              this plan to the extent that such benefit had accrued prior to the
              date on which the amendment is adopted (regardless of whether the
              benefit is in pay status at that time). For this purpose, all
              benefits under this plan shall be considered to accrue as the
              service on which they are based is performed and the



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      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

              compensation on which they are based is earned, in the same manner
              as benefits accrue under the qualified Qualified Pension Plan of
              the Company.

SECTION 11 - SPENDTHRIFT CLAUSE:
--------------------------------

         None of the payments hereunder shall be subject to the claim of any
         creditor of any elected salaried Corporate officer, and to the fullest
         extent permitted by law shall be free from any attachment, garnishment
         or other legal or equitable process. No elected salaried Corporate
         officer shall have any right to alienate, anticipate, commute, pledge,
         encumber or assign any benefit-payable hereunder, and the Company shall
         not be under any duty to honor any such action.

SECTION 12 - INTERPRETATIONS:
-----------------------------

         a)    When necessary the Board of Directors of the Company shall issue
               interpretations and rulings concerning the application and
               meaning of any provision of this Supplemental Pension Plan and
               such interpretations and rulings shall be conclusive and binding
               on all parties with any interest herein. To the extent the
               application of any law becomes relevant, this Supplemental
               Pension Plan shall be construed and administered according to the
               laws of the Commonwealth of Pennsylvania.

         b)    Whenever any words are used herein in the masculine, where
               applicable they shall be construed as though they were also used
               in the feminine or neuter, and whenever any words are used herein
               in the singular or plural, where applicable they shall also be
               construed as though they were also used in the plural or
               singular.

SECTION 13 - ELECTED SALARIED CORPORATE OFFICERS - JOINT AND SURVIVOR OPTION:
-----------------------------------------------------------------------------

         a)    With respect to benefit payments going into pay status on January
               1, 1981 and thereafter, an elected salaried Corporate officer who
               is married at the time of retirement may elect, in the manner
               hereafter set forth, to have his supplemental pension converted
               into a joint and survivor form of payment with his spouse as the
               surviving beneficiary. For so long as the pensioner remains
               eligible for receipt of supplemental pension payments hereunder,
               the joint and survivor form of payment will provide a reduced
               benefit to the pensioner, and upon his death, if the spouse
               survives, the same amount or one-half (1/2) that amount (as
               chosen by the elected salaried Corporate officer in the manner
               described hereafter) will continue to be paid to the spouse for
               the spouse's lifetime. The payments to the spouse will be made as
               of the first business day of each month following the death of
               the pensioner and will terminate with the payment for the month
               in which the death of the spouse occurs.



                                       12
<PAGE>   13

      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

         b)    In the event the election of a specific form of payment of the
               supplemental pension has not been made, the rules incorporated in
               Qualified Pension Plan concerning such matters shall apply to the
               Supplemental Pension Plan as well. Unless a specific election has
               been made to the contrary, when an elected Corporate officer has
               a spouse during his employment or at the time of retirement, the
               100% joint and survivor option shall be the presumed election.
               Further, in the event of his death prior to retirement and while
               in the employment of the Company, if a spouse survives the
               employee it will be presumed that the 100% joint and survivor
               option election was made, consistent with the Qualified Pension
               Plan regulations.

         c)    If the joint and survivor option is elected, the supplemental
               pension otherwise payable to the elected salaried Corporation
               officer will be reduced to reflect the fact that the supplemental
               pension generally will be payable for his lifetime and the
               lifetime of his spouse. The reduced supplemental pension will be
               the actuarial equivalent of the supplemental pension otherwise
               payable. The actuarial equivalent factors will be the same
               factors which would be applicable at the time of retirement to an
               identical joint and survivor benefit under the Qualified Pension
               Plan. In the event benefit payments commence in the form of a
               joint and survivor option and the spouse pre-deceases the retired
               elected salaried Corporate officer, no survivor benefits will be
               paid upon the death of the elected salaried Corporate officer
               and, except as otherwise provided in Section 3(l) hereof, he
               shall continue to receive the reduced supplemental pension for
               his lifetime if he otherwise remains eligible for receipt of
               supplemental benefits.

         d)    Election of the joint and survivor option must be made in writing
               on a form provided by the Company except for the automatic
               election per 13(b). The election must specify whether the spouse
               is to receive the same reduced amount payable to the retired
               elected salaried Corporate officer or one-half (1/2) of that
               amount. The election may be made either prior to or upon
               retirement by filing the above-referenced form with the Company
               Treasurer.

         e)    If an election is to be made upon retirement, the elected
               salaried Corporate officer shall have ten (10) days following
               actual retirement to make the election. If the election is not
               made within such ten (10) day period, the supplemental benefit
               shall be paid in the normal form.

         f)    Without consent of the spouse, an election made prior to
               retirement may be revoked by the elected salaried Corporate
               officer's filing a written revocation with the Company Treasurer
               at any time prior to retirement. An election made prior to
               retirement or an election made at retirement (in the relevant ten
               (10) day period) shall become irrevocable at retirement if the
               elected salaried Corporate officer is




                                       13
<PAGE>   14

      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

               married at the time of retirement. No election shall be of any
               effect if the elected salaried Corporate officer is not married
               at the time of retirement.

         g)    The joint and survivor option election only becomes effective
               upon retirement, and no survivor benefit will be payable in the
               event of the death of an elected salaried Corporate officer prior
               to retirement regardless of any election which may have become
               effective upon such elected salaried Corporate officer's
               retirement except as provided for in Sections 4(e) and 13(b)
               concerning death while holding an officership and the full
               benefit supplement portion (P3). In addition, except as
               specifically provided otherwise in Sections 3(1) hereof and 13(h)
               below, the joint and survivor option will remain applicable after
               retirement only so long as the elected salaried Corporate officer
               remains eligible for receipt of supplemental benefits hereunder
               and if he was receiving such benefits at the time of his death.

         h)    Any joint and survivor option election (made as provided herein)
               of an elected salaried Corporate officer who takes early
               retirement under the Qualified Pension Plan but elects to defer
               commencement of benefits becomes effective upon his retirement.
               In the event of his death prior to commencement of benefits but
               while otherwise satisfying the eligibility requirement for
               receipt of benefits hereunder, his spouse shall be eligible to
               receive the survivor benefit she would have received under the
               joint and survivor option in effect as if his benefit payments
               had commenced as of the first day of the month in which his death
               occurred. Any actuarial reduction or equivalency factors provided
               for herein in the event of early commencement of benefits or
               election of the joint and survivor option shall be determined and
               applied as of the date benefit payments to the elected salaried
               Corporate officer commence or are deemed to have commenced.

         i)    As used herein, spouse means only the person to whom the elected
               salaried Corporate officer was married at the time of his
               retirement or his death prior to his retirement, regardless of
               circumstances occurring thereafter.

SECTION 14 - ELECTED SALARIED CORPORATE OFFICERS/CORPORATE DIRECTORS - INFLATION
--------------------------------------------------------------------------------
ADJUSTMENT:
-----------

         a)    The Inflation Adjustment is to be determined on an ongoing basis,
               retroactive to each subsequent fifth year anniversary since
               retirement (ie, 5th, 10th, 15th, 20th, etc.). However, starting
               during calendar year 1992, two special determinations shall be
               made for any eligible retirees who have been retired for more
               than five (5) years. The first determination is to establish
               their aggregate Inflation Adjustment up to and including their
               1992 anniversary date. The second determination, to be done at
               the appropriate time, is to establish their aggregate Inflation
               Adjustment as of their next-most fifth anniversary of their
               retirement date (ie, 10th, 15th, 20th, 25th, etc.).



                                       14
<PAGE>   15

      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

               The Inflation Adjustment so determined shall be considered part
               of the Supplemental Pension and paid directly by the Company.

         b)    The Inflation Adjustment shall consist of two parts, Part A and
               Part B. Part A shall be the Qualified Pension Plan Inflation
               Adjustment. Part B shall be the Supplemental Pension Plan
               Inflation Adjustment.

               Part A benefits shall be paid to the eligible retired elected
               salaried corporate officer/corporate director, his spouse or
               appropriate beneficiaries in accordance with the election(s) made
               under the Qualified Pension Plan. Part B benefits shall be paid
               to the eligible retired elected salaried corporate
               officer/corporate director, his spouse or appropriate
               beneficiaries in accordance with the election(s) made under
               Section 3 and Section 13 of this Plan.

         c)    The Inflation Adjustment factor (IAF) shall be measured by
               determining the relative increase since retirement of the U.S.
               Department of Labor, Bureau of Labor Statistics Consumer Price
               Index - All Items for Urban Wage Earners and Clerical Workers
               (BLS Consumer Price Index). The statistics for the month and year
               of retirement shall establish the baseline value (Baseline CPI).
               The statistics for the month and year of the appropriate fifth
               year period since retirement shall be used for the current value.
               When calculating the subsequent fifth year updates, the most
               recent applicable values for the BLS Consumer Price Index shall
               be used in lieu of earlier values as the current value (current
               CPI).

         d)    The Inflation Adjustment Factor (IAF) shall be calculated in
               accordance with the following formula:

                            IAF = [Current SPI divided by Baseline CPI] - 1.000

               The Consumer Price Index values are to be expressed to one
               decimal place and the resulting Inflation Adjustment Factor to
               three decimal place accuracy.

               The source for the BLS Consumer Price Index statistics shall be
               the publications by the Bureau of National affairs, Inc. Since
               the Bureau of Labor Statistics will periodically change the base
               years and the specific components of the BLS Consumer Price
               Index, as well as the Index itself, the administrators of the
               Supplemental Plan shall use their best efforts and judgment to
               employ the most equivalent and appropriate information available
               from time to time in preparing the calculation. Their
               determinations shall be consistent with the practices followed in
               establishing the original supplemental pension and shall be
               subject to appropriate Board of Directors' approval before
               initial payment. Initial payment will always be in



                                       15
<PAGE>   16

      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

               arrears of the pertinent retirement anniversary date due to the
               late availability of BLS Consumer Price Index data. When baseline
               values of the BLS Consumer Price Index are not available for
               specific months, then the annual value for the year of retirement
               shall be used instead.

         e)    The Part A Inflation Adjustment benefit shall be determined as
               the product of the original Qualified Pension Plan benefit paid
               times the Inflation Adjustment Factor. The Part B Inflation
               Adjustment benefit shall be determined as the product of the
               original Supplemental Pension Plan benefit paid times the
               Inflation Adjustment Factor. It is contemplated that any ongoing
               adjustment made to the original payment amounts of either the
               Qualified Pension or the Supplemental Pension due to elections
               made or any other aspects of each plan which affect the amount of
               payment shall also apply to the Inflation Adjustment Benefit. For
               example, such an adjustment might be due to early retirement, the
               joint and survivor option reductions, the beneficiary reductions,
               etc.

         f)    It is contemplated that the recipients under the Qualified
               Pension Plan and this Supplemental Pension Plan may differ. If
               so, then the Part A Benefits cannot be combined with the Part B
               Benefits. The Part B Benefits shall be combined with the initial
               Supplemental Pension benefit for payment and whenever possible so
               shall the Plan A Benefits.

SECTION 15 - ELECTED SALARIED CORPORATE OFFICERS - LUMP SUM OPTION:
-------------------------------------------------------------------

         a)    With respect to benefit payments going into pay status on or
               after the effective date of this Section 15 of the Supplemental
               Pension Plan, an elected salaried Corporate officer may elect, in
               the manner hereafter set forth, to have that portion (if any) of
               the supplemental pension which is provided under Section 4(h)
               converted into a lump sum payment. The amount available for
               conversion to a lump sum shall be only that portion (if any)
               payable under Section 4(h), namely, P(5), not any portion of
               P(so). Absent an effective election under this Section 15, that
               portion of the supplemental pension which is provided under
               Section 4(h) (if any) shall be paid in the same form as the
               balance of the supplemental pension.

         b)    The amount of the lump sum shall be calculated based on the
               benefit payable at actual retirement using interest at the rate
               of 7.5% (unless the Board of Directors of the Company determines
               otherwise) and mortality as specified in the 1983 Group Annuity
               Mortality Table for males with a 2-year setback. Because the
               calculation is made as of the date of retirement, no inflation
               adjustment under Section 14 shall be applicable or taken into
               account.



                                       16
<PAGE>   17

      SUPPLEMENTAL PENSION PLAN B AS AMENDED AND RESTATED DECEMBER 31, 2000
      ---------------------------------------------------------------------
                                   (Continued)

         c)    An election of a lump sum under this section shall be effective
               only if made irrevocably in writing (on such form as may be
               prescribed) and filed with the Company Treasurer prior to the
               occurrence of any event that gives the elected salaried Corporate
               officer a right to payment of benefits under the Supplemental
               Pension Plan.

         d)    Payment of a lump sum under this Section 15 shall be made as soon
               as administratively possible after occurrence of the first event
               that gives the elected salaried Corporate officer a right to
               payment of benefits under the Supplemental Pension Plan.

SECTION 13 - FREEZE OF PLAN:

         Effective as of December 31, 2000 (the "Freeze Date"), the Plan is
         hereby frozen with respect to future participation and benefit accrual.
         No person who is not a Participant in the Plan as of the Freeze Date
         shall be eligible to particpate in the Plan and Plan Participants shall
         accrue no additional benefits after the Freeze Date.



                                       17
<PAGE>   18

                                                                     EXHIBIT "A"

                              NON-COMPETE AGREEMENT

                  THIS NON-COMPETE AGREEMENT is entered into as of the
__________day of __________, _______ by and between ____________________________
(the "Company") and ___________________________(the "Employee").

                  WHEREAS the Company has adopted Supplemental Pension Plan B
for Elected Salaried Corporate Officers of the Company (the "Plan") and

                  WHEREAS the Plan expressly provides that as a condition
precedent to the receipt of any benefit payments under the Plan an eligible
elected salaried Corporate officer must execute and comply with an agreement in
the form hereof and

                  WHEREAS the Employee is eligible for benefit payments under
the Plan:

                  NOW THEREFORE this Agreement witnesseth that, for good and
valuable consideration receipt of which is hereby acknowledged and intending to
be legally bound hereby, and as an inducement to the Company to make benefit
payments under the Plan to the Employee, the Company and the Employee agree as
follows:

                  1. The Company shall make benefit payments under and in
accordance with the provisions of the Plan to the Employee so long as the
Employee complies with the provisions of this Agreement and so long as the
Employee's rights and interests in and to any payments under the Plan have not
been terminated or forfeited.

                  2. The Employee shall not, for a period of five years after
the day and year first above written, without the express prior written consent
of the Company engage, directly or indirectly (as officer, director, owner,
employee, agent, consultant, partner or other participant



                                       1
<PAGE>   19

whatsoever), in any activity in competition with the Company nor shall the
Employee at any time reveal to any individual person, firm, corporation,
partnership, joint venture or other entity, any of the Company's trade secrets,
private processes, confidential records, confidential documents, customer lists
or other confidential information. If the Board of Directors of the Company
determines that the Employee is in violation of this Agreement the Company shall
so notify the Employee. If within fourteen (14) days following such notification
the Employee has not ceased and desisted the activity which the Board of
Directors has determined to be in violation of this Agreement the Employee's
rights and interests in and to any payments under the Plan shall be terminated
and forfeited.

                  3. This Agreement has been executed and delivered in the
Commonwealth of Pennsylvania and for all purposes shall be construed and
enforced in accordance with the laws of said Commonwealth.

                  IN WITNESS WHEREOF the Company and the Employee have executed
and delivered this Agreement as of the day and year first above written.

Attest:                                    __________________________________
                                                (Company Name)

_________________________________          By _______________________________
Secretary                                       Title:




(Corporate Seal)                           ___________________________(Seal)
                                           EMPLOYEE



                                       2
<PAGE>   20


               ELECTED SALARIED CORPORATE OFFICER'S OPTIONAL JOINT
                  AND SURVIVOR ELECTION UNDER THE SUPPLEMENTAL
              PENSION PLAN FOR ELECTED SALARIED CORPORATE OFFICERS

                       OF _______________________________

                  I, _____________________________, an elected salaried
Corporate officer of ___________________ do hereby elect that upon my retirement
my benefits under the Supplemental Pension Plan be paid in the form of a joint
and survivor option as described in Section 13 of the Supplemental Pension Plan
B.

                  I elect that upon my death following retirement my spouse,
                  identified below, receive the same reduced supplemental
                  benefit I was receiving during my lifetime.

                  one-half (1/2) the reduced supplemental benefit I was
                  receiving during my lifetime.



          Spouse's Full Name               _______________________________

          Spouse's Social Security Number  _______________________________

                                    ______________________________________

          Spouse's Address          ______________________________________

                                    (City)        (State)      (Zip Code)



          I understand and agree that:

         a) no survivor benefit will be payable in the event that I cease to be
eligible for receipt of supplemental benefits following retirement and, EXCEPT
IN THE EVENT OF MY DEATH


                                       1
<PAGE>   21


FOLLOWING EARLY RETIREMENT DURING A PERIOD WHEN I ELECTED TO DEFER COMMENCEMENT
OF BENEFITS, if I am not receiving supplemental benefit payments at the time of
my death.

         b) if this election is made prior to my retirement, the election will
become effective only upon my retirement and only if I am married at the time of
retirement to the spouse designated above, unless a new election is made with
regard to a different spouse at the time of retirement. In the event I die prior
to retirement, no survivor benefit will be paid to my spouse under the
Supplemental Pension Plan (except were I to die while re-employed after
retirement or in accordance with c) below).

         c) notwithstanding a) and b) above, in accordance with Sections 3(e),
3(n) and 4(e) of Supplemental Pension Plan B, a survivor benefit will be payable
in the event of my death prior to retirement reflecting that part of my
qualified pension which exceeds the maximum pension limitation payable under
ERISA and/or other federal statutes (the full benefit supplement, P3). The P3
benefit shall be paid to my beneficiary or beneficiaries I have designated under
the Qualified Pension Plan or in the absence of such specific designation the
rules of said Plan shall apply.

         d) an election made at retirement can only be made within the ten (10)
day period following actual retirement. Such an election is irrevocable once
made. If the election is not made within such ten (10) day period no joint and
survivor option will be available and no survivor benefits will be paid under
the Supplemental Pension Plan.




                                       2
<PAGE>   22

         e) to make an election, this fully completed form must be filed with
the Company Treasurer and an election will be given no effect unless so filed
(and unless so filed within the relevant ten (10) day period, if applicable).

          f) to revoke an election made prior to retirement I must file a
written revocation of such election with the Company Treasurer. Such revocation
does not need the consent of my spouse but must be filed prior to retirement.

          I certify that I fully understand the foregoing provisions and
election and that the election is made of my own free will and intent, as
evidenced by my signature in the presence of a witness on the date indicated
below.

------------------------------              ----------------------------------
          (Witness Signature)                                        (Signature)

Date:  _________________________            __________________________________
                                                                     Print Name

          The foregoing election was received on the ____________ day of
________________________, ______.



                                             ---------------------------------
                                             Company Treasurer



                                       3
<PAGE>   23

                           SUPPLEMENTAL PENSION PLAN B
                           ---------------------------
                 WORKSHEET FOR CALCULATING INFLATION ADJUSTMENT
                 ----------------------------------------------

<TABLE>
<CAPTION>
<S>                                                        <C>
Name:  ___________________________                             S.S. No.  _____________________________

Retirement Date:  _______________                    Inflation Adjustment Effective Date:  ___________

Directorships and Years of Service:  ________________________________________________
------------------------------------------------------------------------------------------------------
__________________________.  Aggregate Directorship Service:  __________________ years

Qualified Officerships:  __________________________________________________________

Pertinent Qualified Pension Benefit: $___________________          / Month (1)
         Payout Election: ____________

Pertinent Supplemental Pension Benefit (Pre-inflation Adjustment): $ _____________/ Month (2)
         Payout Election: ____________

BLS Consumer Price Index Date: (all cities, urban wage earners and clerical workers-revised)

          a) At month/year of retirement:
                 Month:______  Year: ______  Base Year(s): _______                  BLS CPI Value: _________
                                                                                        (Baseline)
          b) At intermediate point where applicable:
                 Month:______  Year: ______  Base Year(s): _______                  BLS CPI Value: _________
                                                                                         (Current)
          c) At month/year of Inflation Adjustment Effective:
                 Month:______  Year: ______  Base Year(s): _______                  BLS CPI Value: _________
                                                                                         (Current)

CALCULATION OF INFLATION ADJUSTMENT FACTOR (IAF):
-------------------------------------------------

         IAF = [Current CPI Value divided by Baseline CPI Value] - 1.000
</TABLE>



                                       1
<PAGE>   24

                 WORKSHEET FOR CALCULATING INFLATION ADJUSTMENT
                 ----------------------------------------------
                                   (Continued)

<TABLE>
<CAPTION>
<S>                                             <C>
Calculation of Inflation Adjustment:

          a) Part A - Qualified Pension Plan Portion:

                   (1) X (3)

                                             Part A Benefit: $ __________________ /Month (4)

          b) Part B - Supplemental Pension Plan Portion:

                   (2) X (3)

                                             Part B Benefit: $ _________________  /Month (5)

          c) Total Monthly Benefit

                   (4) + (5)

                                             Total Benefit: $ _________________ /Month

Prepared by:  _________________________                        Date:  _________________________


Approved by:

                   CFO:  _______________________               Date:  _________________________

                   CEO:  _______________________               Date:  _______________________
</TABLE>



                                       2
</TEXT>
</DOCUMENT>
