UNION CAMP CORP, DEF 14A, 1998-03-16

UNION CAMP CORP
DEF 14A, 1998-03-16
PAPER MILLS

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Section 240.14a-101 Schedule 14A.
Information required in proxy statement.
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12

UNION CAMP CORPORATION
.................................................................
(Name of Registrant as Specified In Its Charter)

.................................................................
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11

(1) Title of each class of securities to which transaction
applies:

............................................................

(2) Aggregate number of securities to which transaction
applies:

.......................................................

(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the amount
on which the filing fee is calculated and state how it was
determined):

.......................................................

(4) Proposed maximum aggregate value of transaction:

.......................................................

(5) Total fee paid:

.......................................................

[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the
Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

.......................................................

(2) Form, Schedule or Registration Statement No.:

.......................................................

(3) Filing Party:

.......................................................

(4) Date Filed:

.......................................................

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[LOGO]

March 16, 1998

Dear Stockholder:

You are cordially invited to attend the Annual Meeting of Stockholders at
11:00 A.M. on Tuesday, April 28, 1998 at Union Camp Corporation Headquarters,
1600 Valley Road, Wayne, New Jersey.

In addition to the matters set forth in the attached proxy statement, we
will report on the activities of Union Camp during 1997. You will have an
opportunity to ask questions.

I look forward to seeing you at the meeting. Your vote is important to us.
Please sign and return the enclosed proxy in the envelope provided.

On behalf of the Board of Directors and employees, thank you for your
continued support of Union Camp Corporation.

Sincerely,

W. CRAIG MCCLELLAND

W. CRAIG MCCLELLAND
Chairman of the Board
and Chief Executive Officer

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[LOGO]

1600 VALLEY ROAD, WAYNE, N.J. 07470

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

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
APRIL 28, 1998

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

The Annual Meeting of Stockholders of Union Camp Corporation will be held
at Union Camp Corporate Headquarters, 1600 Valley Road, Wayne, New Jersey on
Tuesday, April 28, 1998, at 11:00 A.M., to consider and act upon the following:

(1) The re-election of four directors, each to serve a three-year
term;

(2) The ratification of the appointment of Price Waterhouse LLP as
independent accountants for 1998;

(3) The approval of the Deferred Stock Unit Plan for Outside
Directors;

(4) The approval of the Outside Directors' Stock Option Plan;

(5) The stockholder proposal set forth in the Proxy Statement, if
properly presented at the meeting; and

(6) Such other matters as may properly come before the meeting or any
adjournment thereof.

Stockholders of record at the close of business on March 4, 1998 are
entitled to notice of, and to vote at, the meeting.

Your attention is directed to the accompanying proxy statement.

DIRK R. SOUTENDIJK
Secretary

Wayne, New Jersey
March 16, 1998

WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE DATE, SIGN AND RETURN
THE ENCLOSED PROXY IN THE ENCLOSED ENVELOPE. THE PROXY IS REVOCABLE AND YOU MAY
VOTE YOUR SHARES IN PERSON AT THE MEETING IF YOU WISH TO DO SO.

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UNION CAMP CORPORATION
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PROXY STATEMENT
--------------------------------

TABLE OF CONTENTS

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PAGE
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Questions and Answers...................................................................................... 2

Proposals to be Voted Upon................................................................................. 4

Re-election of Directors.............................................................................. 4

Ratification of Independent Accountants............................................................... 4

Deferred Stock Unit Plan for Outside Directors........................................................ 4

Outside Directors' Stock Option Plan.................................................................. 6

Stockholder Proposal.................................................................................. 7

Other Matters......................................................................................... 9

The Board of Directors..................................................................................... 9

Board Committees...................................................................................... 12

Board Compensation.................................................................................... 13

Executive Compensation..................................................................................... 15

Summary Compensation Table............................................................................ 15

1997 Option Grants Table.............................................................................. 16

Option Exercises and Year-End Value Table............................................................. 17

Pension Plan Table.................................................................................... 18

Report of the Compensation Committee on Executive Compensation........................................ 19

Stock Performance Graph and Chart.......................................................................... 23

Stock Ownership Tables..................................................................................... 24

Management............................................................................................ 24

Other Beneficial Ownership............................................................................ 25

Section 16(a) Beneficial Ownership Reporting Compliance.................................................... 25
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QUESTIONS AND ANSWERS
ABOUT THE ANNUAL MEETING

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Q: WHAT AM I VOTING ON?

A: Re-election of four directors (Jerry H. Ballengee, Ann D. McLaughlin, George J. Sella, Jr. and Ted D.
Simmons) for three year terms;

Ratification of Price Waterhouse LLP as Union Camp's independent accountants;

Approval of the Deferred Stock Unit Plan for Outside Directors;

Approval of the Outside Directors' Stock Option Plan; and

If properly presented to the meeting, a stockholder proposal to endorse the CERES Principles.

Q: WHO IS SOLICITING MY VOTE?

A: The proxy accompanying this proxy statement is being solicited by Union Camp's Board of Directors (the
'Board'). In addition to soliciting your proxy by the use of mailed materials, certain directors, officers
and regular employees of the Company may solicit the return of proxies in person or by telephone and other
means of telecommunication.

Q: WHY DOES THE COMPANY RECOMMEND ADOPTION OF TWO NEW STOCK BASED PLANS FOR OUTSIDE DIRECTORS?

A: These plans replace a retirement plan for outside directors which the Company has terminated. The new plans
will better align the interests of directors with those of stockholders.

Q: WHO IS ENTITLED TO VOTE?

A: Stockholders as of the close of business on March 4, 1998 (the Record Date) are entitled to vote at the
Annual Meeting. Each share of common stock is entitled to one vote on each matter voted on at the Meeting.

Q: HOW DO I VOTE?

A: Sign and date each proxy card you receive and return it in the prepaid envelope which accompanied it. If you
return your signed proxy card, but do not indicate your voting preferences, your shares will be voted FOR
Proposals 1 through 4 and AGAINST the stockholder proposal. You have the right to revoke your proxy any time
before the Meeting by notifying Union Camp's Corporate Secretary, voting in person or returning a later-dated
proxy.

Q: WHO WILL COUNT THE VOTE?

A: Representatives of The Bank of New York (the Company's registrar and transfer agent) will tabulate the votes
and act as inspector of election.
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Q: WHAT DOES IT MEAN IF I GET MORE THAN ONE PROXY CARD?

A: It indicates that your shares are registered differently and are in more than one account. Sign and return
all proxy cards to ensure that all your shares are voted. If you wish to consolidate multiple accounts
registered at The Bank of New York, please call 1-800-524-4458.

Q: WHAT IS A QUORUM?

A: As of the Record Date, 69,244,048 shares of Union Camp's common stock were issued and outstanding. A majority
of these outstanding shares, present or represented by proxy, constitutes a quorum. A quorum is required to
transact business at the Annual Meeting. If you submit a properly executed proxy card, your shares will count
toward the quorum.

Q: WHEN ARE STOCKHOLDER PROPOSALS FOR THE 1999 ANNUAL MEETING DUE?

A: In order to be considered for inclusion in next year's proxy statement, stockholder proposals must be
submitted in writing by November 16, 1998 to Dirk R. Soutendijk, Esq., Corporate Secretary, Union Camp
Corporation, 1600 Valley Road, Wayne, NJ 07470.

Q: HOW DOES A STOCKHOLDER PROPOSE THE TRANSACTION OF BUSINESS AT THE ANNUAL MEETING?

A: Union Camp's bylaws provide that a stockholder who wishes to raise a matter for action at the Annual Meeting,
including nominating any person for election as a director, must give Union Camp's Corporate Secretary
written notice of his intent containing the information specified in the bylaw at least 60 days in advance of
the anniversary date of the previous Annual Meeting of Stockholders. A copy of this bylaw provision may be
obtained by writing Union Camp's Corporate Secretary.

Q: HOW DOES A STOCKHOLDER NOMINATE SOMEONE FOR CONSIDERATION AS A DIRECTOR OF UNION CAMP?

A: A stockholder may recommend a person to be considered as a nominee for director by writing to the Corporate
Secretary. Recommendations must be accompanied by a description of the individual's qualifications, other
relevant biographical information and his consent to serve if elected.

Q: HOW MUCH DID THIS PROXY SOLICITATION COST?

A: D.F. King & Co., Inc. was retained to help with the distribution of proxy materials and solicitation of votes
for $10,500, plus out-of-pocket expenses.

Union Camp reimburses brokerage houses and other custodians, nominees and fiduciaries for their expenses for
forwarding proxy and solicitation material to the owners of common stock.
</TABLE>

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PROPOSALS TO BE VOTED UPON

PROPOSAL 1 -- RE-ELECTION OF DIRECTORS

Nominees for re-election to a three year term are Jerry H. Ballengee, Ann
D. McLaughlin, George J. Sella, Jr. and Ted D. Simmons. (See page 9 for more
information.)

If a nominee is unable to stand for re-election, the Board may provide for
a lesser number of directors or designate a substitute nominee. In the latter
case, shares represented by proxies may be voted for the substitute nominee.

Your Board recommends a vote FOR these nominees.

The nominees will be elected if they receive a plurality of the votes cast.
An abstention and a vote withheld count for purposes of establishing a quorum,
but is not a vote cast.

PROPOSAL 2 -- RATIFICATION OF PRICE WATERHOUSE LLP AS INDEPENDENT
ACCOUNTANTS

Price Waterhouse LLP ('PW') was appointed by the Board of Directors,
subject to ratification by the stockholders, to examine the consolidated balance
sheet of the Company and its consolidated subsidiaries as of December 31, 1998
and the related consolidated statements of income and cash flows for the year
1998, and for such other purposes incidental thereto as may be required. PW has
been the Company's independent accountants since 1977.

A representative of PW will be present at the meeting to respond to
appropriate questions and make a statement at the meeting if he wishes.

PROPOSAL 3 -- APPROVAL OF THE DEFERRED STOCK UNIT PLAN FOR OUTSIDE
DIRECTORS

INTRODUCTION

During 1997 the Board of Directors terminated the Retirement Plan for
Outside Directors (the 'Retirement Plan') as of December 31, 1997. The Board
adopted the Deferred Stock Unit Plan for Outside Directors (the 'DSU Plan'),
subject to stockholders' approval, to provide a vehicle for non-employee
directors who so elect, to convert the present value of their accrued benefits
under the terminated Retirement Plan to units whose underlying value is based on
the value of Union Camp common stock. Under the DSU Plan, deferred stock units
credited to a participant's account will be converted to an equivalent number of
shares of Company common stock and distributed to the participant after his
service on the Board ends.

The material features of the DSU Plan are summarized below. The DSU Plan is
attached to this proxy statement as Exhibit A. If the Plan and the summary
differ in any respect, the terms of the Plan shall govern.

SUMMARY OF MATERIAL FEATURES OF THE DSU PLAN

All current non-employee directors are eligible to participate in the DSU
Plan by electing to allocate all or part of the present value of their accrued
Retirement Plan benefit determined as of December 31, 1997 to the DSU Plan.
Seven non-employee directors have made such an election and the initial credit
to their deferred stock unit accounts is as follows:

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DEFERRED STOCK UNIT PLAN FOR OUTSIDE DIRECTORS

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NON-EMPLOYEE DOLLAR NUMBER OF
DIRECTOR GROUP VALUE($) DEFERRED STOCK UNITS
- ------------------------------------------------------------ -------- --------------------

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Seven Directors............................................. $742,548 13,356
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As provided in the DSU Plan, the number of deferred stock units shown above
was determined by dividing the present value of the participants' accrued
Retirement Plan benefit by $55.5844 which is the average of the fair market
value of a share of Union Camp common stock on the last 30 trading days of 1997.

Beginning with the common stock dividend payable March 13, 1998, each
participant's deferred stock unit account will be credited with additional units
when dividends on Union Camp common stock are paid. The hypothetical cash
dividend for each deferred stock unit shall be the amount of the cash dividend
paid with respect to a share of Company common stock. The total hypothetical
stock dividends credited on the deferred stock units in an account shall be
converted to additional deferred stock units by dividing the hypothetical cash
dividends by the fair market value of a share of Company common stock on the
dividend payment date.

When a participant ceases to be a member of the Board, he will be entitled
to receive payment of his deferred stock unit account. The Company will effect
payment by distributing to the participant shares of Company common stock equal
to the number of deferred stock units in his account. Such distribution will be
either in a lump sum or in five or ten annual installments, as elected by the
participant.

The number of shares of Company common stock reserved for issuance under
the DSU Plan is 25,000 shares, subject to adjustment in the event of an
occurrence listed in the next paragraph. Shares of common stock distributed
under the DSU Plan shall be authorized, but unissued and any reserved shares not
required by the Plan shall return to the status of authorized, but unissued
stock when the Plan ends. The number of shares reserved is an estimate based
upon the initial credit of 13,356 stock units and an estimate of the additional
units which will be credited by the addition of hypothetical cash dividends
until each participant's account has been paid in full.

Subject to certain limitations, the DSU Plan provides for adjusting the
number of stock units credited to participants' accounts in the event of a stock
dividend, stock split, reverse split, subdivision, recapitalization, merger,
consolidation, combination or exchange of shares, separation, reorganization or
liquidation.

In the event of a 'Change in Control' of the Company, the Board may decide
that all stock units credited under the DSU Plan shall pertain to the number of
hypothetical securities of the resulting corporation to which a holder of the
same number of shares of Company common stock would be entitled. In the absence
of such a decision, the DSU Plan will terminate and the participants' accounts
will be paid in cash, the amount being determined by multiplying the fair market
value of a share of the Company's common stock on the date of the Change in
Control by the number of stock units in the account.

To the extent possible the DSU Plan shall be self-administering, but to the
extent that is not possible, it will be administered by the Board. The DSU Plan
will end when all stock units have been distributed unless the Board terminates
it earlier. The Board may also make changes in the Plan.

If the DSU Plan is not approved, the Board shall determine an alternate
vehicle for the investment of the dollar value of the present value of the
participants' accrued Retirement Plan benefit.

The Board recommends that you vote FOR this proposal. The accompanying
proxy will be voted FOR the proposal unless you make a contrary specification.
This proposal will be adopted if more votes are cast in favor of it than are
cast against it. Abstentions and broker non-votes are counted for quorum
purposes, but are not votes cast and do not affect whether more votes have been
cast in favor of the proposal than have been cast against it.

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PROPOSAL 4 -- APPROVAL OF THE UNION CAMP CORPORATION OUTSIDE
DIRECTORS' STOCK OPTION PLAN

INTRODUCTION

With the elimination of the Retirement Plan for Outside Directors, the
Company's independent compensation consultants recommended that, beginning in
1998, outside directors receive annual stock option grants as part of a
competitive median level, total compensation program. The Board adopted the
Union Camp Corporation Directors' Stock Option Plan (the 'Directors' Plan'),
subject to stockholder approval.

The Directors' Plan will further strengthen directors' alignment with
stockholders and encourage the acquisition of a proprietary interest in the
future of the Company through the ownership of Company common stock. It is also
expected that the Directors' Plan will encourage highly qualified persons to
serve as directors of the Company.

The principal features of the Directors' Plan are summarized below. The
Directors' Plan is attached to this proxy statement as Exhibit B. If the
Directors' Plan and the summary differ in any respect, the terms of the
Directors' Plan shall govern.

SUMMARY OF MATERIAL FEATURES OF THE DIRECTORS' PLAN

The Directors' Plan will be administered and interpreted by the Board of
Directors including determining when and to whom options will be granted and the
number of shares to be included in each grant. Directors who are not employees
of the Company are eligible to be granted options under the Directors' Plan.
There are currently nine such directors. The total number of shares that may be
issued pursuant to options granted under the Directors' Plan is 350,000 shares
of Company common stock subject to adjustment upon the occurrence of certain
events summarized below. The Plan will continue until the earlier of termination
by the Board (in which case outstanding options shall remain outstanding for the
term of their grant) or the date when all shares covered by the Directors' Plan
are purchased or all options have expired.

The option price per share shall be as determined by the Board, although it
may not be less than 100% of the fair market value of a share of Company common
stock on the date the option is granted. The option term shall be set by the
Board, but it may not exceed 10 years. Options are immediately exercisable
through the payment of cash and/or shares of Company common stock previously
owned by the optionee.

It is anticipated that during 1998 the Board will grant each of the
Company's non-employee directors an option to purchase 1,200 shares of Union
Camp common stock. The market value of a share of such stock was $59.00 on March
3, 1998.

Options are not transferable by the optionee other than by will or the laws
of descent and distribution except the Board may, in its discretion, permit
transfer to the optionee's immediate family or a trust or similar vehicle
established solely for the benefit of such family members.

Subject to certain limitations, the Directors' Plan provides for adjusting
the shares of Company common stock subject to outstanding options, or the
numbers or option prices thereof, in the event of a stock dividend, stock split,
reverse split, subdivision, recapitalization, merger, consolidation, combination
or exchange of shares, separation, reorganization or liquidation.

The Board of Directors may amend or discontinue the Directors' Plan, but no
amendment may, without stockholder approval, increase the number of shares for
which options may be granted or decrease the option price of an option to less
than 100% of the fair market value of a share of Company common stock on the
date of the option grant.

FEDERAL INCOME TAX CONSEQUENCES

Under the U.S. Internal Revenue Code, the grant of options does not result
in taxable income to the optionees or a tax deduction to the Company. The
exercise of an option generally results in ordinary

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taxable income to the optionee equal to the difference between the exercise
price and the fair market value of the underlying shares on the date of
exercise, and a corresponding tax deduction to the Company equal to the amount
of ordinary income recognized by the individual for the taxable year in which
the individual recognizes such income.

The Board recommends that you vote FOR this proposal. The accompanying
proxy will be voted FOR the proposal unless you make a contrary specification.
The Directors' Plan will be approved if more votes are cast in favor of it than
are cast against it. Abstentions and broker non-votes are counted for quorum
purposes, but are not votes cast and do not affect whether more votes have been
cast in favor of the proposal than have been cast against it.

PROPOSAL 5 -- STOCKHOLDER PROPOSAL

A stockholder has informed the Company that it intends to present the
proposal set forth below at the Annual Meeting. The name and address of the
stockholder and two co-sponsors and the number of shares of Common Stock they
hold will be furnished, promptly upon receipt of a request made orally or in
writing to Dirk R. Soutendijk, Secretary of the Company.

Your Board of Directors has carefully reviewed this proposal and
recommends a vote AGAINST it.

STOCKHOLDER RESOLUTION REGARDING ENDORSEMENT OF THE CERES PRINCIPLES
FOR PUBLIC ENVIRONMENTAL ACCOUNTABILITY

WHEREAS WE BELIEVE: Responsible implementation of a sound, credible
environmental policy increases long-term shareholder value by raising
efficiency, decreasing clean-up costs, reducing litigation, and enhancing public
image and product attractiveness;

Adherence to public standards for environmental performance gives a company
greater public credibility than standards created by industry alone. For maximum
credibility and usefulness, such standards should specifically meet the concerns
of investors and other stakeholders;

Companies are increasingly being expected by investors to do meaningful,
regular, comprehensive and impartial environmental reports. Standardized
environmental reports enable investors to compare performance over time. They
also attract investment from investors seeking companies which are
environmentally responsible and which minimize the risk of environmental
liability.

WHEREAS: The Coalition for Environmentally Responsible Economies
(CERES) -- which includes shareholders of this Company; public interest
representatives, and environmental experts -- consulted with corporations to
produce the CERES Principles as comprehensive public standards for both
environmental performance and reporting. Scores of companies, including Bank
America, Baxter International, Bethlehem Steel, General Motors, H.B. Fuller, ITT
Industries, Pennsylvania Power and Light, Polaroid and Sun [Sunoco], have
endorsed these principles to demonstrate their commitment to public
environmental accountability and standardized reporting. Fortune-500 endorsers
say that benefits of working with CERES are public credibility, direct access to
major environmental and shareholder organizations, leadership in designing the
rapidly advancing standardization of environmental disclosure, and measurable
value-added for the company's environmental initiatives;

A company endorsing the CERES Principles commits to work toward:

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1. Protection of the biosphere 4. Energy conservation 7. Environmental restoration
2. Sustainable natural resource use 5. Risk reduction 8. Informing the public
3. Waste reduction and disposal 6. Safe products/services 9. Management commitment
10. Audits and reports
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[Materials on the CERES Principles and CERES Report Form are obtainable from
CERES, 711 Atlantic Avenue, Boston MA 02110, tel: 617-451-0927, fax:
617-482-2028].

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CERES is distinguished from other initiatives for corporate environmental
responsibility by being (1) a successful model of shareholder relations; (2) a
leader in public accountability through standardized environmental reporting;
and (3) a catalyst for significant and measurable environmental improvement
within firms.

RESOLVED: Shareholders request the Company to endorse the CERES Principles as a
part of its commitment to be publicly accountable for its environmental impact.

SUPPORTING STATEMENT

Many investors support this resolution. Those sponsoring similar
resolutions at various companies have portfolios totaling $75 billion.
Furthermore, the number of public pension funds and foundations supporting this
resolution increases every year. We believe the CERES Principles exceed the
European Community regulation for voluntary participation in verified and
publicly-reported eco-management and auditing, and that they also exceed the
requirements for ISO 14000.

Your vote FOR this resolution will encourage both scrutiny of our Company's
environmental policies and reports and adherence to goals supported by
management and stakeholders alike. We believe the CERES Principles will protect
both your investment and your environment.

MANAGEMENT'S STATEMENT OPPOSING THE STOCKHOLDER PROPOSAL

When the CERES proponents first approached us, we considered their program
in the context of our long standing commitment to environmental responsibility
and sound resource management strategies. Our commitment is partially evidenced
by our participation in industry programs with operational principles
specifically tailored to our businesses and the fact that the Company has
voluntarily initiated programs that go beyond legal requirements. These programs
are particularly well suited to our culture.

Union Camp's commitments under these programs are substantially the same as
those called for by the CERES Principles, but our approach has additional
benefits. First, when the Company determines to commit to a program it does so
because it believes such action is in the best interest of all its shareholders
not just a single group. Second, there is a pride of ownership in the Company's
programs which have been designed and implemented by our employees, in
cooperation with other stakeholders. These programs are not static; they change
as challenges are met and new issues arise. The result is that our work force
maintains a high level of commitment which would be difficult to achieve if the
Company adopted a third party's vision. Third, we believe we are allocating our
resources for maximum effectiveness. The industry programs help to keep our
knowledge current and allow us to share solutions with others facing similar
issues. Our own programs make environmental responsibility an integral part of
our every day business and we disclose our environmental initiatives through
several means including issuing environmental reports and meeting with community
leaders where we operate.

We also file many required reports on our environmental activities.
Committing to yet another required report adds cost. We are committed to cost
containment in the current operating environment. We do not believe the extra
cost of producing the CERES report is outweighed by its benefits.

CERES says it is a voluntary program. This means that each company asked to
consider it is free to choose. CERES is a good choice for some companies, but
not for all. In fact, many of the organizations in the CERES coalition do not
endorse the Principles. Some very fine companies have decided, in their exercise
of free choice, that the CERES Principles fit their cultures. We have decided
that right now our programs fit our culture better.

Accordingly, the Board recommends a vote AGAINST this proposal. The
accompanying proxy will be voted AGAINST the stockholder proposal unless a
contrary specification is made. The stockholder proposal will have been adopted
if more votes are cast in favor of it than are cast against it. Abstentions and
broker non-votes are counted for quorum purposes, but are not votes cast and do
not affect whether more votes have been cast in favor of the proposal than have
been cast against it.

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OTHER MATTERS

The Board of Directors has at this time no knowledge of any matters to be
brought before the meeting other than those referred to above. However, if any
other matters properly come before the meeting, it is the intention of the
persons named in the accompanying proxy to vote said proxy in accordance with
their judgment on such matters.

THE BOARD OF DIRECTORS

NOMINEES FOR ELECTION TO A THREE-YEAR TERM
EXPIRING AT THE 2001 ANNUAL MEETING OF STOCKHOLDERS
(CLASS II)

[Photo]

JERRY H. BALLENGEE
Mr. Ballengee, 60, was elected President and Chief Operating Officer of
the Company in July 1994. He had been an Executive Vice President of the
Company since November 1988 and prior to that he was a Senior Vice
President of the Company. He has been a director of the Company since
1988. Mr. Ballengee is a director of Chicago Bridge and Iron Company
N.V.

[Photo]

ANN D. MCLAUGHLIN
Ms. McLaughlin, 56, is Chairman of the Aspen Institute (a non-profit
organization assisting in formulating the policies and developing the
values-based leadership of democratic institutions). She was Vice
Chairman of the Aspen Institute from 1993 to October 1996. From 1990 to
1995 she was President of the Federal City Council, Washington, D.C. (a
non-profit organization to improve the Nation's capital). Ms. McLaughlin
was a director of the Company in 1987, resigned to become United States
Secretary of Labor and rejoined the Board of Directors in 1989. She is a
director of AMR Corporation, Donna Karan International, Fannie Mae,
General Motors Corporation, Harman International Industries, Inc., Host
Marriott Corporation, Kellogg Company, Nordstrom, Potomac Electric Power
Company, Sedgwick Group plc and Vulcan Materials Company.

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[Photo]

GEORGE J. SELLA, JR.
Mr. Sella, 69, is the retired Chairman of the Board and Chief Executive
Officer of American Cyanamid Company. He has been a director of the
Company since 1985. Mr. Sella is a director of Bush Boake Allen Inc.,
Coulter Pharmaceutical, The Equitable Companies Incorporated and The
Equitable Life Assurance Society of the United States.

[Photo]

TED D. SIMMONS
Mr. Simmons, 67, is Managing Director of Physical Facilities for the
Church of Jesus Christ of Latter Day Saints. From April 1987 until
January 1991 he was Vice Chairman of the Board of The Mutual Benefit
Life Insurance Company. Mr. Simmons has been a director of the Company
since 1988.

DIRECTORS CONTINUING IN OFFICE

[Photo]

GEORGE D. BUSBEE
Mr. Busbee, 70, is a retired Senior Partner of and Of Counsel to the law
firm of King & Spalding, Atlanta, Georgia* and a former Governor of
the State of Georgia. Mr. Busbee has been a director of the Company
since 1983. He is a director of Weeks Corporation.
Class III Director, Term Expires .................................. 1999

[Photo]

RAYMOND E. CARTLEDGE
Mr. Cartledge, 68, was Chairman of the Board and Chief Executive Officer
of the Company from January 1986 until his retirement in June 1994. From
April 1996 until December 1997, he was Chairman of the Board of Savannah
Foods & Industries, Inc. Mr. Cartledge has been a director of the
Company since 1983. He is a director of Blount, Inc., Chase Brass
Industries, Inc., Delta Air Lines, Incorporated, Sun Company, Inc. and
UCAR International Inc.
Class III Director, Term Expires .................................. 1999

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[Photo]

SIR COLIN R. CORNESS
Sir Colin Corness, 66, was Chairman of the Board of Glaxo Wellcome plc
(an international pharmaceutical company) until his retirement in May
1997. From May 1991 until his retirement in May 1995, Sir Colin was
Chairman of the Board of Redland PLC (an international construction
materials producer). Prior to May 1991, he was Chairman of the Board and
Chief Executive Officer of Redland PLC. Sir Colin has been a director of
the Company since 1991. He is a director of Taylor Woodrow plc.
Class I Director, Term Expires .................................... 2000

[Photo]

ROBERT D. KENNEDY
Mr. Kennedy, 65, is the retired Chairman of the Board and Chief
Executive Officer of Union Carbide Corporation (an international
petrochemical corporation). Mr. Kennedy has been a director of the
Company since 1990. He is a Director of Birmingham Steel Corporation,
General Signal Corporation, Kmart Corporation, LionOre Mining
International Ltd., UCAR International Inc., Union Carbide Corporation
and Sun Company, Inc.
Class I Director, Term Expires .................................... 2000

[Photo]

GARY E. MacDOUGAL
Mr. MacDougal, 61, served as Chairman of the Board and Chief Executive
Officer of Mark Controls Corporation (building control systems and flow
controls manufacturer) from November 1969 until May 1988. He is Senior
Advisor to the Governor of Illinois on Human Services Reform and a
Trustee of the Annie Casey Foundation (for disadvantaged children). He
was the General Director of the New York City Ballet from 1993 to 1994.
Prior to March 1990, he was United States delegate and Alternate
Representative to the United Nations. Mr. MacDougal has been a director
of the Company since 1975. He is a director of the Bulgarian-American
Enterprise Fund, Saratoga Partners and United Parcel Service of America,
Inc.
Class III Director, Term Expires .................................. 1999

<PAGE>

[Photo]

W. CRAIG MCCLELLAND
Mr. McClelland, 63, is Chairman of the Board and Chief Executive Officer
of the Company. He was President and Chief Operating Officer of the
Company from December 1989 to July 1994. Previously, he was an Executive
Vice President of the Company since November 1988. From September 1986
until November 1988, Mr. McClelland was a Director and Executive Vice
President of International Paper Company and President and Chief
Executive Officer of Hammermill Paper Company (a subsidiary of
International Paper Company). Prior to September 1986, he was a Director
and President and Chief Executive Officer of Hammermill Paper Company.
Mr. McClelland has been a director of the Company since 1988. He is a
director of Allegheny Teledyne, Inc. and PNC Financial Corporation.
Class I Director, Term Expires .................................... 2000

[Photo]

JEREMIAH J. SHEEHAN
Mr. Sheehan, 59, is Chairman of the Board and Chief Executive Officer of
Reynolds Metals Company (international aluminum and packaging
corporation). He was President and Chief Operating Officer of Reynolds
Metals Company from January 1994 until October 1996 and prior to that he
was an Executive Vice President of Reynolds Metals Company. Mr. Sheehan
has been a director of the Company since 1996. He is a director of
Reynolds Metals Company, Federal Reserve Bank of Richmond and Universal
Corporation.
Class III Director, Term Expires .................................. 1999

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

* The Company retained the law firm of King & Spalding on several matters
during 1997.

BOARD COMMITTEES

The Board has appointed an Audit Committee, a Personnel, Compensation and
Nominating Committee, a Pension Investment Committee and a Public Issues
Committee, which are composed of non-employee directors of the Company.

The Audit Committee (i) recommends the independent accountants to be
appointed, (ii) meets with the independent accountants, the chief internal
auditor and corporate officers to review matters relating to corporate financial
reporting and accounting procedures and policies, adequacy of financial,
accounting and operating controls and the scope of the audits of the independent
accountants and

<PAGE>

internal auditors, (iii) reviews and reports the results of such
audits to the Board, (iv) submits recommendations relating to financial
reporting and accounting practices and policies and financial, accounting and
operating controls to the Board and (v) considers the impact on the Company's
financial statements or condition of any infraction of laws, regulations or
policies, compliance oversight being the responsibility of the Public Issues
Committee.

The Personnel, Compensation and Nominating Committee (i) makes
recommendations concerning the election of the Company's officers, (ii) sets the
compensation of the Company's policy committee executives and reviews the
compensation and compensation plans for officers of the Company, (iii) awards
incentive compensation and bonuses to officers of the Company, (iv) administers
the Company's stock option plans and (v) recommends to the Board the membership
of Board Committees. This Committee also recommends to the Board candidates for
nomination as directors, and will consider nominees recommended by stockholders.

The Pension Investment Committee periodically reviews the activities of the
Company's management in supervising the investment of the Company's pension
funds.

The Public Issues Committee in its discretion (i) inquires into and reviews
any matter involving the conduct of the Company's business which affects the
public or in which the public has a strong interest, (ii) recommends policies
and programs which further the Company's interests to the Board and/or the
Company's management, (iii) provides oversight with respect to the Company's
compliance activities as to environmental, health and safety, employment and
other legal standards of conduct, and (iv) reports to the Board on matters
believed to be of significance to the Board.

Committee memberships and the number of meetings of the Board and its
committees during 1997 are shown below.

MEMBERSHIP ROSTER

<TABLE>
<CAPTION>
SPECIAL PERSONNEL,
DIRECTORS' COMPENSATION PENSION PUBLIC
NAME BOARD MEETINGS AUDIT AND NOMINATING INVESTMENT ISSUES
- ----------------------------------------------- ----- ---------- ----- -------------- ----------- ------

<S> <C> <C> <C> <C> <C> <C>
Jerry H. Ballengee............................. X X
George D. Busbee............................... X X X X
Raymond E. Cartledge........................... X X X X
Sir Colin Corness.............................. X X X X
Robert D. Kennedy.............................. X X X*
Gary E. MacDougal.............................. X X X X*
W. Craig McClelland............................ X* X
Ann D. McLaughlin.............................. X X X*
George J. Sella, Jr............................ X X X X*
Jeremiah J. Sheehan............................ X X X X
Ted D. Simmons................................. X X X X X

No. of Meetings in 1997........................ 8 2 3 6 2 2
</TABLE>

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

*Chairperson

BOARD COMPENSATION

Directors who are employees of the Company do not receive any additional
compensation by reason of their membership on, or attendance at meetings of, the
Board or committees thereof.

Non-employee directors receive an annual retainer fee of $32,000. This is
composed of $23,000 in cash plus shares of Company Common Stock pursuant to the
Stock Compensation Plan for Non-

<PAGE>

Employee Directors (the 'Stock Compensation Plan'). The Stock Compensation Plan
provides that immediately after each Annual Meeting, each non-employee director
shall receive as part of his annual fee the number of whole shares of Company
common stock provided in the Plan for that year, or if there is no provision for
that year, whole shares with a fair market value of approximately $5,000. The
fair market value of any annual grant of such stock may not exceed $40,000 for
each non-employee director. The total number of shares of Company common stock
that may be awarded under the Stock Compensation Plan is 150,000. During 1997
each non-employee director received 187 shares of Company common stock pursuant
to the Stock Compensation Plan which had a fair market value of approximately
$9,000 at the time of its grant. The Stock Compensation Plan provides that each
non-employee director shall receive for 1998 shares of Company common stock
having a fair market value of approximately $9,000. Non-employee directors are
also paid $1,500 for each meeting of the Board they attend, $750 for each
committee meeting they attend and $1,000 per year for serving as the Chair of a
committee. A fee of $750 is paid for special directors' meetings which are
typically held the evening prior to a Board meeting.

Non-employee directors may elect to defer for such period as they determine
all or part of their directors' retainer and meeting fees in which case interest
is earned on the deferred amounts at the rate equal to the average yield on 91
day U.S. Treasury bills for the preceding period of December 1 through November
30 compounded annually.

During 1997 the Board decided to terminate the Retirement Plan for Outside
Directors. This plan had provided for a retirement benefit equal to 50% of the
annual retainer to non-employee directors who had completed five years of
service plus an additional 10% of the retainer for each year of service over
five, but not more than ten. The benefit was unfunded and was paid annually for
the number of years the director served on the Board.

Effective December 31, 1997 the plan was terminated. Each participating
director made an election to allocate the present value of his accrued benefit
under the plan. The choices were deferred stock units as provided in the
Deferred Stock Unit Plan for Outside Directors which the Board is asking
stockholders to approve at the Annual Meeting and an unfunded cash account which
will be credited with the rate earned by the fixed income fund in the Company's
savings plan. Amounts converted to deferred stock units will be paid in Company
stock, while cash accounts will be paid in cash, in each case after the director
leaves the Board.

<PAGE>

<PAGE>
EXECUTIVE COMPENSATION

The following table shows information with respect to the annual and
long-term compensation for services in all capacities to the Company and its
subsidiaries during the fiscal years ended December 31, 1997, 1996 and 1995 paid
or accrued to the chief executive officer and the other most highly compensated
executive officers of the Company.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG TERM
COMPENSATION AWARDS
--------------------------
ANNUAL COMPENSATION RESTRICTED SECURITIES
---------------------------- STOCK UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS AWARDS($)(1) OPTIONS(#) COMPENSATION(2)
- --------------------------------------------------- ---- -------- -------- ------------ ---------- ---------------
<S> <C> <C> <C> <C> <C> <C>
W. Craig McClelland ............................... 1997 $695,000 $386,000 $ 65,829 84,600 $38,465
Chairman of the Board and Chief 1996 $650,000 $123,455 $ 36,330 80,000 $35,732
Executive Officer 1995 $588,500 $639,937 $420,643 61,000 $41,466
Jerry H. Ballengee ................................ 1997 $471,500 $211,600 $ 44,487 39,100 $27,146
President and Chief Operating Officer 1996 $442,500 $ 69,552 $ 24,768 39,100 $24,515
1995 $400,500 $360,528 $286,023 33,300 $26,555
Charles H. Greiner, Jr. ........................... 1997 $280,000 $112,500 $ 26,692 17,000 $10,545
Executive Vice President 1996 $257,000 $ 31,878 $ 14,569 14,500 $ 9,349
1995 $240,000 $162,238 $172,961 10,600 $12,238
A. William Hamill ................................. 1997 $275,000 $103,600 $ 27,649 15,000 $10,348
Executive Vice President 1996 $135,417 -- $ 98,125 21,000 $ 4,516
and Chief Financial Officer 1995 -- -- -- -- --
John T. Heald, Jr. ................................ 1997 $280,000 $101,600 $ 26,692 17,000 $12,186
Executive Vice President 1996 $257,000 $ 31,878 $ 14,569 14,500 $10,913
1995 $240,000 $161,282 $172,961 10,600 $13,063
James M. Reed ..................................... 1997 $414,000 $143,000 $ 38,124 15,000 $25,702
Retired Vice Chairman and Chief Administrative 1996 $391,000 $ 47,527 $ 22,253 18,000 $23,567
Officer 1995 $365,000 $228,334 $263,159 24,000 $26,694
</TABLE>

- ------------
(1) The value of the restricted stock awards was determined by multiplying the
closing price of the Company's Common Stock on the date of grant by the
number of shares awarded. The restricted stock awards were granted on
January 27, 1998 for fiscal year 1997, January 28, 1997 for fiscal year
1996, and January 30, 1996 for fiscal year 1995. As of December 31, 1997,
the number of shares and the value of aggregate restricted stockholdings
were as follows: 9,694 shares ($519,538) by Mr. McClelland; 6,622 shares
($354,898) by Mr. Ballengee; 3,054 shares ($163,675) by Mr. Greiner; 1,800
shares ($96,469) by Mr. Hamill; 3,054 shares ($163,675) by Mr. Heald; and
6,168 shares ($330,566) by Mr. Reed. On January 27, 1998 restricted stock
awards were made with respect to services rendered during 1997. As of
February 2, 1998, the number of shares and the value of aggregate restricted
stockholdings were as follows: 8,225 shares ($481,677) by Mr. McClelland;
5,605 shares ($328,243) by Mr. Ballengee; 2,780 shares ($162,804) by Mr.
Greiner; 2,091 shares ($122,454) by Mr. Hamill; 2,780 shares ($162,804) by
Mr. Heald; and 5,151 shares ($301,655) by Mr. Reed. Each award becomes free
of restrictions in equal installments over 5 years. The number of shares
awarded was as follows: 8,371 for 1995, 751 for 1996 and 1,169 for 1997 to
Mr. McClelland; 5,692 for 1995, 512 for 1996 and 790 for 1997 to Mr.
Ballengee; 3,442 for 1995, 300 for 1996 and 474 for 1997 to Mr. Greiner;
2,000 for 1996 and 491 for 1997 to Mr. Hamill; 3,442 for 1995, 300 for 1996
and 474 for 1997 to Mr. Heald; and 5,237 for 1995, 460 for 1996 and 677 for
1997 to Mr. Reed. Common Stock dividends are payable on restricted stock.
(2) The compensation reported represents (a) Company contributions under the
Salaried Employees Savings and Investment Plan and related supplemental
plan; and (b) amounts imputed or credited to the named executive officer for
premiums paid for group life insurance. The Company contributions for 1997
pursuant to the Salaried Employees Savings and Investment Plan were as
follows: $20,850 to Mr. McClelland; $14,145 to Mr. Ballengee; $8,400 to Mr.
Greiner; $8,375 to Mr. Hamill; $8,400 to Mr. Heald; and $12,420 to Mr. Reed.
The amounts imputed or credited for life insurance premiums were as follows:
$17,615 to Mr. McClelland; $13,001 to Mr. Ballengee; $2,145 to Mr. Greiner;
$1,973 to Mr. Hamill; $3,786 to Mr. Heald; and $13,282 to Mr. Reed.

<PAGE>

<PAGE>
OPTIONS

The following two tables summarize option grants to and exercises by the
executive officers named in the Summary Compensation Table during 1997 and the
value of the options held by them as of December 31, 1997.

OPTION GRANTS IN 1997

<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- ------------------------------------------------------------------------------------
NUMBER OF POTENTIAL REALIZABLE VALUE AT ASSUMED
SECURITIES % OF TOTAL ANNUAL RATES OF STOCK PRICE APPRECIATION
UNDERLYING OPTIONS FOR OPTION TERM(3)
OPTIONS GRANTED TO EXERCISE(2) -------------------------------------------
GRANTED EMPLOYEES IN OR BASE EXPIRATION 5%(4) 10%(5)
NAME (#)(1) FISCAL 1997 PRICE ($/SH) DATE 0% APPRECIATION APPRECIATION
- ------------------------- ------------ ------------ ------------ ---------- --- ------------ ------------

<S> <C> <C> <C> <C> <C> <C> <C>
W. Craig McClelland...... 84,600 8.9% $58.8438 11/24/07 - 0 - $3,130,725 $7,933,940
Jerry H. Ballengee....... 39,100 4.1 58.8438 11/24/07 - 0 - 1,446,942 3,666,868
Charles H. Greiner, Jr... 17,000 1.8 58.8438 11/24/07 - 0 - 629,105 1,594,291
A. William Hamill........ 15,000 1.6 58.8438 11/24/07 - 0 - 555,093 1,406,727
John T. Heald, Jr........ 17,000 1.8 58.8438 11/24/07 - 0 - 629,105 1,594,291
James M. Reed............ 15,000 1.6 58.8438 11/24/07 - 0 - 555,093 1,406,727
- ----------------------------------------------------------------------------------------------------------------------------------

All Shareholders(6)...... N/A N/A N/A N/A - 0 - $2,579,703,164 $6,537,531,716
All Optionees(7)......... 949,700 100% $58.8438 11/24/07 - 0 - $ 35,144,788 $ 89,064,575
Optionees Gain as %
of All Shareholders'
Gain................... N/A N/A N/A N/A N/A 1.4% 1.4%
</TABLE>

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

(1) The options become exercisable two years from the date of grant, i.e., on
November 25, 1999. Optionees who are executive officers of the Company may
elect to have stock otherwise deliverable upon the exercise of the option
withheld by the Company in order to meet income tax withholding obligations
which arise upon the exercise of the option.

(2) The exercise price is the fair market value of the underlying stock on the
date of the option grant.

(3) The dollar amounts under these columns are the result of calculations at 0%
and at the 5% and 10% rates set by the SEC and are not intended to forecast
possible future appreciation, if any, of Union Camp's Common Stock.

(4) Union Camp Common Stock would be trading at $95.85 per share for the values
shown to be realizable, an increase in stock price which will benefit all
stockholders commensurately.

(5) Union Camp Common Stock would be trading at $152.63 per share for the values
shown to be realizable, an increase in stock price which will benefit all
stockholders commensurately.

(6) As of November 30, 1997, there were 69,710,026 shares of the Company's
Common Stock outstanding. The calculations shown herein are based on the
assumed rates of price appreciation, compounded annually, from the stock's
fair market value of $58.8438 on November 25, 1997 when the above options
were granted.

(7) The amounts shown are based on the assumed rates of appreciation, compounded
annually, from the stock's fair market value of $58.84385 on November 25,
1997, the date the options were granted.

<PAGE>

<PAGE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
NUMBER OF SHARES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
END OF 1997 END OF 1997
---------------- -------------------
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE REALIZED(1) UNEXERCISABLE UNEXERCISABLE(2)
- --------------------------------------- --------------- ----------- ---------------- -------------------

<S> <C> <C> <C> <C>
W. Craig McClelland.................... 13,560 $ 751,847 201,455/164,600 $1,469,743/$337,500
Jerry H. Ballengee..................... 2,399 $ 139,344 135,857/ 78,200 $1,261,826/$164,953
Charles H. Greiner, Jr................. - 0 - - 0 - 42,200/ 31,500 $ 340,306/$ 61,172
A. William Hamill...................... - 0 - - 0 - - 0 - / 36,000 - 0 - /$ 50,094
John T. Heald, Jr...................... 3,450 $ 94,552 48,200/ 31,500 $ 422,275/$ 61,172
James M. Reed.......................... 5,791 $ 202,094 102,619/ 33,000 $ 953,343/$ 75,938
</TABLE>

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

(1) Value is the difference between the market value of the Company's common
stock on the date of exercise and the exercise price.

(2) Value is the difference between the market value of the Company's common
stock on December 31, 1997, i.e., $53.59375, and the exercise price.

RETIREMENT PLANS

The Retirement Plan for Salaried Employees is a defined benefit plan funded
solely by Company contributions. The calculation of benefits under the
Retirement Plan is based upon average earnings, which include salary, overtime
and vacation payments, bonuses and incentive compensation received during the
highest 60 consecutive months of the 120 months preceding retirement ('Final
Average Earnings'). The amount of the retirement benefit provided to a
participating employee under the Retirement Plan equals the product of the sum
of 1.05% of the participating employee's Final Average Earnings plus .45% of
those Final Average Earnings in excess of the average applicable Social Security
wage base at the date of retirement, multiplied by the number of years of
credited service of the employee with the Company or one of its participating
subsidiaries. Benefits under the Retirement Plan are not subject to any
deduction for Social Security benefits or other offset amounts. If retirement
benefits exceed payments permitted from tax qualified trusts, the excess amount
will be paid by the Company on an unfunded basis out of its general assets.

The Company has adopted a Supplemental Retirement Income Plan for Executive
Officers (the 'Plan') under which the Personnel, Compensation and Nominating
Committee of the Board of Directors (the 'Committee') may from time to time
designate certain executive officers as participants if such officers are (i)
members of the Company's policy committee and/or (ii) hired at mid-career and
responsible for a significant segment of the Company's business. The Plan
currently covers eleven policy committee members. The Plan provides for a
minimum pension upon retirement at age 65 (or earlier with Committee approval)
following at least 10 years of service of 40% of the participant's average
earnings, which include salary, vacation payments and annual target incentive,
during the highest 60 consecutive months of the 120 months preceding retirement
('Average Pension Compensation') which increases by 1 1/2% for each year of
additional service up to a maximum of 55% of Average Pension Compensation after
20 years of service. Payments under the Plan will be reduced by (i) pensions
under the Retirement Plan for Salaried Employees and the related Supplemental
Retirement Plan, (ii) any other pensions which may be payable by other employers
and (iii) one-half of the amount of primary Social Security benefits. If an
officer engages in certain competitive activity after retirement, benefits under
the Plan will terminate. The Plan provides that Mr. McClelland shall receive a
minimum annual pension equal to the higher of the Plan's benefit or the sum of
$22,400 plus any pension payable under the Retirement Plan for Salaried
Employees and the related Supplemental Retirement Plan.

<PAGE>

The following table shows the approximate annual pensions payable under all
the plans described to the executive officers named in the Summary Compensation
Table assuming retirement at age 65, whose Average Pension Compensation and
years of service at retirement would be in the classifications indicated. The
amounts shown have not been reduced by any pension payable by another employer
or Social Security benefits which are offsets to the pensions payable under the
Plan.

<TABLE>
<CAPTION>
PENSION PLAN TABLE
AVERAGE YEARS OF SERVICE
PENSION ------------------------------------------------------------
COMPENSATION 10 15 20 25 30
- ------------ -------- -------- -------- -------- --------

The calculation of the amounts shown assumes that the employee remains in
the service of the Company or one of its participating subsidiaries until age
65, that the retirement program is continued in its present form and that the
individual receives the benefits in the form of a single life annuity. As of
December 31, 1997, Messrs. Ballengee, Greiner, Hamill, Heald, McClelland and
Reed were credited with 16, 25, 1, 20, 9 and 28 years of service, respectively,
under the Retirement Plan, including credit for prior service with a subsidiary
of the Company in the case of Mr. Reed.

SEVERANCE ARRANGEMENTS

The individuals named in the Summary Compensation Table and six other
executive officers have executed individual severance agreements with the
Company. Each agreement provides that if, while the agreement is in effect
following a 'change in control of the Company,' the Company terminates the
executive's employment without 'cause' or the executive terminates his
employment for 'good reason' (as such terms are defined in the severance
agreements), the executive will receive a lump sum severance benefit from the
Company up to three times the sum of his annual salary and up to three times the
amount of his annual target incentive. An executive would also be entitled to
continue to receive certain welfare insurance benefits for up to three years.
The Company will also make an additional payment to the executive so that
benefits received in connection with a change in control, whether pursuant to
the severance agreements or otherwise, will not be subject to net reduction due
to the imposition of excise taxes under Section 4999 of the Code. The individual
severance agreements provide for the distribution in a lump sum to the
executives if their employment is terminated following a change in control while
the severance agreement is in effect of (i) supplemental savings amounts
credited to the executives and (ii) the actuarial equivalent of the supplemental
pension benefit accrued under the Company's Supplemental Retirement Plan. In
addition, amounts due pursuant to the Company's Supplemental Retirement Income
Plan for Executive Officers, determined as if the executive were credited with
up to three additional years of age and service, shall be distributed to the
executives in a lump sum if termination of employment occurs while the agreement
is in effect and after a change in control.

<PAGE>

REPORT OF THE PERSONNEL,
COMPENSATION AND NOMINATING COMMITTEE
ON EXECUTIVE COMPENSATION

COMMITTEE RESPONSIBILITIES

The Personnel, Compensation and Nominating Committee (the 'Committee') is
composed of five independent, non-employee directors. The Committee's
responsibilities are to:

Approve each component of the Company's executive compensation
program

Set salaries for policy Committee executives and review the salaries
of other officers

Determine awards earned under the Company's incentive plans

Judge the effectiveness of the compensation program as a whole

OBJECTIVES OF THE EXECUTIVE COMPENSATION PROGRAM

The executive compensation program is designed to:

Attract and motivate exceptional executives to work in the interests
of the Company's stockholders

Provide competitive compensation opportunities

Condition a significant part of executive compensation on attaining
specific performance goals and

Reward exceptional accomplishments

The Committee met six times during 1997 seeking an appropriate balance
among these objectives. Particular attention was paid to the following two key
objectives:

PROVIDING COMPETITIVE COMPENSATION

The Committee's philosophy is to provide the CEO and the other executive
officers with the opportunity to earn total compensation which, at targeted
levels of performance, is competitive with the median total compensation earned
by executives holding comparable positions in the paper and forest products
industry and with comparable size companies in general industry (see Note 1). To
determine median competitive total compensation, the Committee regularly reviews
information from various sources, including proxy statements, industry surveys
and independent compensation consultants.

CONDITIONING COMPENSATION ON PERFORMANCE

The Company's annual and long term incentive plans put a substantial
portion of an executive's compensation at risk. Achieving value under these
plans depends on Company financial, operating, strategic and shareholder return
performance as well as the executive's individual performance.

COMPONENTS OF EXECUTIVE COMPENSATION AND REPORT OF THE COMMITTEE'S ACTIONS IN
1997

The Company's executive compensation program has three principal
components:

Base Salaries

Annual Incentives

Long Term Incentives

These components are designed to work together to provide an appropriate
relation between an executive's compensation, his performance and the Company's
performance.

The CEO's compensation consists of the three components listed above. As
discussed below, the methodology and measurements used by the Committee to
determine executive compensation are equally applicable to the CEO who was not
present during any discussions about his compensation.

<PAGE>

BASE SALARY

The Committee believes base salaries should be externally competitive and
internally equitable. Base salaries are targeted annually at median base salary
levels for similar positions in the paper and forest products industry and at
companies of comparable size in general industry (see Note 1). Each executive
officer's base salary is reviewed annually by the Committee and may be adjusted
if warranted. Base salaries may be outside targeted medians depending upon the
individual's sustained performance and/or length of time in the position.

1997 Action: During 1997, the base salaries of the executive officers named
in the Summary Compensation Table (the 'Named Executive Officers'), except for
the CEO and the COO, were increased as recommended by the CEO to maintain
competitive salaries. The Company's independent compensation consultants
reported that the resulting base salaries of these Named Executive Officers were
within their targeted median competitive levels.

Effective July 1, 1997, the CEO and COO received salary increases. The
amounts were determined by the Committee after considering competitive
compensation and trend data for the paper and forest products industry and
general industry as presented by the independent compensation consultants. After
the increases, the CEO's base salary was at the low end of the median
competitive salary level and the COO's base salary was at the median competitive
salary level recommended by the consultants.

THE ANNUAL INCENTIVE PLAN

The objective of the Annual Incentive Plan is to motivate management to
optimize the Company's financial and operating results. It is designed to reward
achievement of near term tactical goals required to achieve the Company's long
term strategic goals.

Target incentives for the Named Executive Officers are median competitive
annual incentives recommended by the independent compensation consultants and
are based on annual incentive compensation paid to executives in comparable
positions in the Company's comparison group (see Note 1). The target incentives
range from 60% of base salary for the CEO to 45% of base salary for the other
Named Executive Officers. Payment of the targeted incentive amounts requires:

The Company and key business units achieve financial goals and

The Named Executive Officers achieve operating (non-financial)
goals.

Goals are established as part of the Company's annual planning and
budgetary process. At the beginning of each year the Committee reviews and
approves the financial performance measures and operating goals. The actual
incentives earned may be at, above or below the targeted amounts depending upon
performance.

Executives' incentives are tied to the financial performance measures most
appropriate to their responsibilities. To focus attention on overall corporate
objectives and reinforce the need for teamwork, each participant has a portion
of his incentive tied to financial performance measures for the entire Company.
The portion of the incentive determined by financial performance for Messrs.
McClelland, Ballengee, Hamill and Reed is based solely on Company-wide financial
results. Messrs. Heald and Greiner have a portion of their incentive based on
the financial results of the key business units for which they are responsible.

1997 Action: The annual incentives paid to the Named Executive Officers are
shown in the Summary Compensation Table on page 15.

Early in 1997 the Committee approved specific financial and operating goals
which the CEO and the other Named Executive Officers had to accomplish in order
to receive their targeted incentives. These goals were weighted 70% for
financial and 30% for operating accomplishments. Since the 1997 results were
below the goal levels established, incentives were reduced below the targeted
levels for the CEO and the other Named Executive Officers.

<PAGE>

LONG TERM INCENTIVES

Long Term Incentives are a significant portion of the Company's executive
compensation. They are designed to tie compensation levels to shareholder value.
Therefore, all Long Term Incentive payments are based in Company stock.

Target Long Term Incentive levels are recommended for the CEO, COO and each
of the other Named Executive Officers by the independent consultants and are
expressed as expected value multiples times competitive salaries (see Note 1).
After the Committee reviews and approves the expected value multiples, a total
target Long Term Incentive is calculated for each officer and delivered from two
Plans, the Stock Option Plan and the Restricted Stock Performance Plan.

THE STOCK OPTION PLAN

Stock options are one of the two components of the Company's long term
incentives. The primary objectives of granting stock options are:

To provide congruity between stockholders and management

To encourage management to build their equity interest in the
Company and

To provide financial rewards that are directly linked to long term
growth in the value of the Company's stock.

Stock options are normally granted annually, cannot be exercised for two
years and expire 10 years from the date of grant. All stock options have an
exercise price equal to 100% of the market value of the Company's stock on the
date of grant. Thus, options provide no value to executives unless all
stockholders benefit by appreciation in the Company's stock.

1997 Action: The Committee granted stock options in November 1997. The
stock options granted to the CEO and the other Named Executive Officers during
1997 are shown in the Option Grants table on page 16.

The number of stock options granted equaled competitive median Long Term
Incentive values, determined by the independent compensation consultants using a
version of the Black-Scholes formula, minus the target incentives under the
Restricted Stock Performance Plan. The Committee considers stock options to be
primarily compensatory and, accordingly, expects to use the same methodology
each year.

THE RESTRICTED STOCK PERFORMANCE PLAN

The second long term incentive component is the Restricted Stock
Performance Plan. The objective of this Plan is to focus management's attention
on two critical factors affecting the Company's long term performance and reward
them for making successful long term decisions. These factors are return on
capital and earnings per share. Awards of restricted stock earned under the Plan
further align management's interest with those of the Company's stockholders.

Under the Plan, restricted stock is earned by the CEO and the other members
of the Company's policy committee when the Company attains specific return on
capital and earnings per share goals. Rewards are earned, respectively, by
achievement of a return on capital ranking in the upper half of a competitor
group of 13 major paper and forest products companies (see Note 2) and earnings
per share that are within a forecasting formula's performance range. For
targeted performance this Plan's award equals 40% of the executive's base salary
and the maximum award is 80% of base salary. The value of the restricted stock
earned under this plan varies with the Company's stock price performance.

1997 Action: During 1997 shares of restricted stock were earned and granted
in January 1998. The values of the grants to the CEO and the other Named
Executive Officers are shown in the Summary Compensation Table on page 15.

<PAGE>

No shares were earned based on the Company's return on capital ranking
which was slightly below the median of the 13 company competitor group. However,
the Company's earnings per share for 1997 were within the range of the Plan's
forcasting formula. The earnings per share were between the forecasted target
and the minimum target. Therefore, the portion of the incentive based on this
measurement was reduced below the targeted level. This resulted in the CEO and
the other Named Executive Officers each earning shares of restricted stock equal
to 9.2% of his annual base salary in effect on January 1, 1998. The shares of
restricted stock earned will vest 20% a year over five years provided the
executive remains in the Company's employ.

IRS LIMIT ON DEDUCTIBILITY OF COMPENSATION

The Committee considered the deductibility of compensation under Section
162(m) of the Internal Revenue Code. This rule restricts the Company's deduction
of compensation paid to the Named Executive Officers to $1,000,000 per year
unless paid under plans the tax code considers 'performance-based.' The
Committee took the steps necessary to qualify compensation earned under the
Stock Option and Restricted Stock Performance Plans as 'performance-based.' The
Company's stockholders approved the revised plans. Therefore, compensation
earned under these plans will not be subject to the $1,000,000 limit on
deductibility.

The Committee also determined that, in designing and administering the
executive compensation program, it will strive to preserve the complete tax
deductibility of executive compensation unless this goal conflicts with the
primary objectives of the Company's compensation program or the tax deduction
lost is insignificant. The Committee reviewed the 1997 deductibility of
compensation paid to the Named Executive Officers and found the lost
deductibility to be insignificant. The Committee also reviewed potential
compensation payable to the Named Executive Officers for 1998 and found that any
loss of tax deductibility at targeted performance would again be insignificant.

SUMMARY

The Committee believes the quality and motivation of the Company's senior
management and all its employees are critical factors in the Company's ability
to meet future challenges and build long-term stockholder value. The Company's
emphasis on variable pay (pay at risk) rewards executives who contribute to the
Company's success. The compensation program's mix of both short and long-term
financial performance criteria and stock options, tie executive pay to critical
measures of corporate performance and stockholder value.

Robert D. Kennedy, Chair
Sir Colin R. Corness
Gary E. MacDougal
George J. Sella, Jr.
Ted D. Simmons

- ------------
Note 1: This comparison group differs from and is larger than the peer group
used in the stock performance graph on page 23. The Company has historically
used this larger group because it represents the market in which the Company
competes for executive talent.

Note 2: This competitor group differs from and is larger than the peer group
used in the stock performance graph (which, at selection, consisted of the
companies in the Dow Jones Paper Group Index) because the Company has
historically compared its financial performance with this larger group.

<PAGE>

STOCK PERFORMANCE GRAPH

The graph below compares the cumulative total stockholder return of Union
Camp common stock, the S&P 500 Composite -- 500 Stock Index and an index of a
peer group of paper companies, for the period of five years beginning December
31, 1992 and ending December 31, 1997 (assuming that the value of the investment
in Union Camp common stock and each index was $100 on December 31, 1992 and that
all dividends were reinvested). The peer group index is comprised of 8 medium to
large sized companies (Boise Cascade, Bowater, Champion International,
Consolidated Papers, P.H. Glatfelter, International Paper, Mead, and Westvaco)
whose primary business is the manufacture and sale of paper products. Peer group
returns are weighted each year based on each company's market capitalization at
the beginning of the year.

FIVE YEAR CUMULATIVE TOTAL STOCKHOLDER RETURN

[PERFORMANCE GRAPH]

DATE UNION CAMP CORP. S&P 500 PEER GROUP
---- ---------------- ------- ----------
<S> <C> <C> <C>
DEC-92 100 100 100
DEC-93 107 110 108
DEC-94 109 112 121
DEC-95 114 153 135
DEC-96 119 188 142
DEC-97 138 251 154

</TABLE>

The chart below compares the Company's total stockholder return for 1997
with the total stockholder return of the 8 paper products companies in the peer
group used in the above stock performance graph. The Company ranks second based
on this measure.

Total Stockholder Return
--------------------------
1997

[GRAPH]

<TABLE>
<CAPTION>
Union Camp
Corp.
----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
20.2% 16.3% 12.5% 12.1% 8.8% 7.3% 5.2% -1.7% -3.0%

</TABLE>

<PAGE>

<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
AS OF DECEMBER 31, 1997

This table indicates the amount of common stock the directors and executive
officers of the Company owned as of December 31, 1997.

<TABLE>
<CAPTION>
AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP
-----------------------------------------------------------
NAME OF UNION CAMP PERCENT DEFERRED STOCK BUSH BOAKE ALLEN PERCENT
BENEFICIAL OWNER COMMON STOCK OF CLASS UNITS(1) INC. COMMON STOCK(2) OF CLASS
- -------------------------------- ------------ -------- -------------- -------------------- --------

<S> <C> <C> <C> <C> <C>
Jerry H. Ballengee.............. 168,650(3) * -- - 0 - *
George D. Busbee................ 2,708 * -- - 0 - *
Raymond E. Cartledge............ 214,872(3)(4) * 497 5,000 *
Sir Colin Corness............... 2,129 * -- 1,000 *
Charles H. Greiner, Jr.......... 48,452(3) * -- - 0 - *
A. William Hamill............... 2,149 * -- 2,000 *
John T. Heald, Jr............... 53,296(3) * -- - 0 - *
Robert D. Kennedy............... 2,468 * 2,959 - 0 - *
Gary E. MacDougal............... 4,187 * 2,750 - 0 - *
W. Craig McClelland............. 245,244(3) * -- 1,000 *
Ann D. McLaughlin............... 520 * 2,887 - 0 - *
James M. Reed................... 142,404(3) * -- 5,000 *
George J. Sella, Jr............. 2,408 * 2,000 3,500 *
Jeremiah J. Sheehan............. 1,187 * 69 - 0 - *
Ted D. Simmons.................. 4,208(4) * 2,194 1,000 *
Directors and Executive Officers
as a Group (20 Persons)....... 1,071,720(3) 1.5% 13,356 19,100 *
</TABLE>

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

* Less than one percent of the shares outstanding.

(1) If the Deferred Stock Unit Plan for Outside Directors is approved by
stockholders at the annual meeting the deferred stock units shown will be
credited to the accounts of the directors indicated. Deferred stock units
will be converted to shares of Union Camp Common Stock and distributed to
the director after he ceases to be a member of the Board.

(2) Union Camp Corporation is the beneficial owner of 68% of the outstanding
common stock of Bush Boake Allen Inc. which is listed on the New York Stock
Exchange.

(3) The shares shown as beneficially owned include the number of shares of
Company common stock that directors and executive officers had the right to
acquire within 60 days after December 31, 1997 pursuant to unexercised
options under the Company's stock option plans as follows: 135,857 shares
for Mr. Ballengee, 176,032 shares for Mr. Cartledge, 42,200 shares for Mr.
Greiner, 48,200 shares for Mr. Heald, 201,455 shares for Mr. McClelland,
102,619 for Mr. Reed and 860,877 for all directors and executive officers as
a group (20 persons). The shares shown include restricted stock held by
executive officers which become free of restrictions on sale over a period
of five years from the date of grant as follows: 6,622 shares for Mr.
Ballengee, 3,054 shares for Mr. Greiner, 1,800 shares for Mr. Hamill, 3,054
shares for Mr. Heald, 9,694 shares for Mr. McClelland, 6,168 for Mr. Reed
and 34,788 shares for all executive officers as a group.

(4) The shares of common stock shown as beneficially owned (a) by Mr. Cartledge
include 13,068 shares that are owned by his spouse as to which beneficial
ownership is disclaimed and (b) by Mr. Simmons include 700 shares that are
owned by his spouse as to which beneficial ownership is disclaimed.

<PAGE>

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

To the knowledge of the Company, and based on filings on Schedule 13G in
February 1998 with the Securities and Exchange Commission, no person or group
owned beneficially more than five percent of the outstanding common stock of the
Company except:

<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
NAME AND ADDRESS OF BENEFICIAL PERCENT OF
BENEFICIAL OWNER OWNERSHIP(1) CLASS
- -------------------------------------------- ---------------------- ----------

<S> <C> <C>
Sanford C. Bernstein & Co., Inc. 5,131,496(2) 7.40%
767 Fifth Avenue
New York, NY 10153

The Capital Group Companies, Inc. 8,001,640(3) 11.50%
333 South Hope Street
Los Angeles, CA 90071

Delaware Management Company 4,218,696(4) 6.05%
2005 Market Street
Philadelphia, PA 19103
</TABLE>

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

(1) 'Beneficially owned' means the sole or shared power to direct the voting of
a security or the sole or shared power to direct the disposition of a
security.

(2) Sanford C. Bernstein & Co., Inc. has sole voting power 2,929,619 shares,
shared voting power as to 432,238 shares and sole dispositive power as to
5,131,496 shares.

(3) Capital Research and Management Company, investment advisors, and other
subsidiaries of The Capital Group Companies, Inc., exercised as of December
31, 1997, investment discretion with respect to 7,877,000 and 124,640
shares, respectively, which was owned by various institutional investors.

(4) Delaware Management Company, in its capacity as investment advisor, has sole
voting power as to 2,849,500 shares, no shared voting power, sole
dispositive power as to 4,032,496 shares and shared dispositive power as to
186,200 shares of Company Common Stock which are owned by its clients.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Two purchase transactions, one by Mr. Simmons and one by Mr. Simmons'
spouse, as to which Mr. Simmons disclaims beneficial ownership, were reported
late.

By Order of the Board of Directors

DIRK R. SOUTENDIJK
Secretary

March 16, 1998

<PAGE>

<PAGE>
EXHIBIT A

UNION CAMP CORPORATION
DEFERRED STOCK UNIT PLAN FOR OUTSIDE DIRECTORS

1. PURPOSE AND BACKGROUND. The Union Camp Corporation Deferred Stock Unit
Plan for Outside Directors (the 'Plan') is designed to provide a vehicle for
those non-employee directors ('Outside Directors') of the Board of Directors of
Union Camp Corporation (the 'Company') who elect to participate herein, to
convert the present value of their accrued benefits under the Company's
Retirement Plan for Outside Directors to units whose underlying value is based
on the value of the Company's $1.00 par value common stock ('Common Stock').

2. DEFINITIONS. When used in the Plan, the following terms shall have the
meanings set forth below unless the context clearly requires a different
meaning. Nouns in the singular shall include the plural, and the masculine
pronoun shall include the feminine gender.

(a) Account. The book account established and maintained by the Company for
a Participant (i) to record the Stock Units credited to the Participant under
Section 3 of the Plan as a result of the conversion of Participant's Accrued
Retirement Benefit to Stock Units and (ii) to record Stock Units credited to the
Participant under Section 4 of the Plan as a result of the conversion of
hypothetical dividends and other distributions into Stock Units. Each
Participant shall have a nonforfeitable right to his Account at all times.

(b) Accrued Retirement Benefit. With respect to any Participant on the
Effective Date, the amount of the present value of the annual retirement benefit
accrued on behalf of such Participant under the Retirement Plan, determined as
of December 31, 1997.

(d) Cessation of Service. The date on which a Participant ceases to be a
director.

(e) Effective Date. January 1, 1998.

(f) Exchange Act. The Securities Exchange Act of 1934, as amended.

(g) Fair Market Value. The mean of the high and low sales prices for a
share of Common Stock as reported on the Composite Tape for New York Stock
Exchange issues for the date for which the determination of Fair Market Value is
to be made.

(h) Participant. A non-employee director who participates in the Plan by
electing, in accordance with the terms of the Retirement Plan, to have his
Accrued Retirement Benefit converted to Stock Units under this Plan.

(i) Retirement Plan. The Union Camp Corporation Retirement Plan for Outside
Directors, as in effect on December 31, 1997.

(j) Rule 16b-3. Rule 16b-3 of the Securities and Exchange Commission
promulgated under the Exchange Act. A reference in the Plan to Rule 16b-3 shall
include a reference to any corresponding rule (or number redesignation) or any
amendments to Rule 16b-3 enacted after the Effective Date.

(k) Securities Act. The Securities Act of 1933, as amended.

(l) Stock Unit. A hypothetical share of Common Stock. Notwithstanding the
foregoing, Stock Units shall not confer upon Participants any of the rights
associated with Common Stock ownership, including, without limitation, the right
to vote or to receive distributions with respect thereto.

3. ELIGIBILITY AND CREDITING OF STOCK UNITS. Each non-employee director who
has elected, in accordance with the terms of the Retirement Plan, to have his
Accrued Retirement Benefit converted to Stock Units shall have credited to his
Account the number of Stock Units, determined by dividing (i) his Accrued
Retirement Benefit, by (ii) the average of the Fair Market Value of a share of
Common Stock on December 31, 1997 and each of the preceding twenty-nine (29)
days on which The New York Stock Exchange was open for business.

A-1

<PAGE>

4. CREDITING OF DIVIDENDS AND OTHER DISTRIBUTIONS.

(a) The Stock Units credited to a Participant's Account shall be credited
with hypothetical cash dividends equal to the cash dividends that are declared
and paid with respect to Common Stock. The Company shall determine as of each
record date the amount of cash dividends to be paid with respect to a share of
Common Stock and, on the payment date of such dividend, shall credit an equal
amount of hypothetical cash dividends to each Stock Unit credited to a
Participant's Account. The total hypothetical cash dividends credited to all
Stock Units shall then be converted into additional Stock Units by dividing such
hypothetical cash dividends by the Fair Market Value of a share of Common Stock
on the dividend payment date.

(b) The Stock Units credited to a Participant's Account shall be credited
to reflect any distribution with respect to Common Stock other than cash
dividends. The Company shall determine as of each record date the amount of the
distribution to be paid with respect to a share of Common Stock and, on the
payment date of such distribution, shall credit an equal amount of hypothetical
distribution to each Stock Unit credited to a Participant's Account. The total
hypothetical distribution credited to all Stock Units shall then be converted
into a hypothetical cash amount based on the fair market value of such
distribution, as determined by the Board in its discretion. The hypothetical
cash amount shall then be converted into Stock Units by dividing such
hypothetical cash amount by the Fair Market Value of a share of Common Stock on
the date on which the Company makes the distribution with respect to Common
Stock.

(c) Hypothetical cash dividends and distributions other than cash dividends
shall continue to be credited to Stock Units pursuant to this Section 4 of the
Plan until distribution to the Participant is required under the Plan.

5. FORM OF PAYMENT OF ACCOUNTS.

(a) Except as provided in Section 9(c) of the Plan, if a Participant is
entitled to receive payment of his Account, the Company shall distribute to the
Participant that number of whole shares of Common Stock equal to the number of
Stock Units in his Account either in (i) a lump sum, (ii) five (5) annual
installments or (iii) ten (10) annual installments, the form of payment to be
irrevocably elected by the Participant on or about January 1, 1998.

(b) Notwithstanding any other provision of this Plan to the contrary, the
Company shall not be required to issue or deliver any certificate for shares of
Common Stock before (i) the admission of such shares to listing on any stock
exchange on which the Common Stock may then be listed, (ii) the effectiveness of
any required registration and/or other qualification of such shares under any
state or federal law or regulation that counsel for the Company shall determine
is necessary or advisable, and (iii) the Company shall have been advised by
counsel that all applicable legal requirements have been fulfilled. Until the
Participant has been issued a certificate for the shares of Common Stock
distributable hereunder, the Participant shall possess no shareholder rights
with respect to such shares.

6. TIMING OF PAYMENT OF ACCOUNTS. A Participant's Account will be
distributed to him as provided under Section 5 of the Plan following Cessation
of Service, as soon as administratively feasible in the event the Participant
has elected a lump sum distribution or annually in five (5) or ten (10)
substantially equal installments commencing on January 1 of the year following
the year in which Cessation of Service occurs.

7. STOCK RESERVED FOR THE PLAN. The aggregate number of shares of Common
Stock authorized for issuance under the Plan is twenty-five thousand (25,000),
subject to adjustment pursuant to Section 9 of the Plan. Shares of Common Stock
delivered hereunder shall be authorized but unissued shares.

8. FRACTIONAL SHARES. For purposes of determining the number of Stock Units
to be credited to a Participant's Account initially under Section 3 of the Plan
and as distributions under Section 5 of the Plan, fractional Stock Units shall
be eliminated by rounding down to the nearest whole Stock Unit. For purposes of
crediting dividends under Section 4 of the Plan and determining the number of
Stock Units in a Participant's Account as a result of the crediting of such
dividends, fractional Stock Units shall be maintained.

A-2

<PAGE>

9. EFFECT OF CHANGES TO COMMON STOCK.

(a) Upon changes in the Common Stock by a stock dividend, stock split,
reverse split, subdivision, recapitalization, merger, consolidation (whether or
not the Company is a surviving corporation), combination or exchange of shares,
separation, reorganization or liquidation, the number and class of shares of
Common Stock available under the Plan and other relevant provisions shall be
correspondingly adjusted by the Company; provided, however, no such adjustments
shall be made in the case of stock dividends aggregating in any fiscal year of
the Company not more than 10% of the Common Stock issued and outstanding at the
beginning of such year or in the case of one or more splits, subdivisions or
combinations of the Common Stock during any fiscal year of the Company resulting
in an increase or decrease of not more than 10% of the Common Stock issued and
outstanding at the beginning of such year.

(b) If an adjustment is made to Common Stock under Section 9(a) of the
Plan, Stock Units shall be automatically adjusted to the same extent as if the
Stock Unit were a share of Common Stock. If the adjustment would produce
fractional Stock Units, the fractional Stock Units shall be eliminated by
rounding down to the nearest whole Stock Unit.

(c) If the Company is a party to (i) a consolidation or a merger in which
the Company is not the surviving corporation, (ii) a transaction that results in
the acquisition of substantially all of the Company's outstanding stock by any
person, as such term is used in Sections 13(d) and 14(d) of the Exchange Act, or
entity, or (iii) a sale or transfer of substantially all of the Company's assets
(each, a 'Change in Control'), the Board, in its discretion, may declare that
all Stock Units credited hereunder shall pertain to and apply, with appropriate
adjustment as determined by the Board, to that number of hypothetical securities
of the resulting corporation to which a holder of the same number of shares of
Common Stock would be entitled; provided, however, that in the absence of any
such determination, the right of a Participant to receive shares of Common Stock
pursuant to Section 5 of the Plan shall terminate and the Company shall pay such
Participant as soon as administratively possible after the Change in Control,
the balance in his Account in the form of cash, the amount of such payment to be
determined by reference to the Fair Market Value of the Common Stock represented
by the Stock Units in the Participant's Account on the date of the Change in
Control.

10. INTERPRETATION AND ADMINISTRATION OF THE PLAN. To the extent possible,
the Plan shall be self-administering. To the extent the Plan cannot be
self-administering, the Plan shall be administered, construed and interpreted by
the Board, to the extent permitted by Rule 16b-3. Any decision of the Board with
respect to the Plan shall be final, conclusive and binding upon all
Participants. The Board may consult with counsel who may be counsel for the
Company, and shall not incur any liability for any action taken in good faith in
reliance upon the advice of such counsel. The Corporate Secretary of the Company
is authorized to take or cause to be taken such actions of a ministerial nature
as shall be necessary to effectuate the intent and purposes of the Plan,
including maintaining records of the Accounts of Participants and arranging for
distributions of Accounts.

11. TERM OF THE PLAN. The Plan shall become effective on the Effective
Date; provided, however, such effectiveness shall be subject to the approval of
the Plan by the stockholders of the Company within twelve months of adoption by
the Board. The Plan shall terminate on the date when all Stock Units hereunder
have been distributed; provided, however, that the Board may resolve to
terminate the Plan at any time prior to that date. Termination of the Plan by
the Board shall not alter or impair any of the rights of a Participant to his
Account unless the Participant consents in writing.

12. AMENDMENTS. The Board may from time to time make such changes in and
additions to the Plan as it deems appropriate. The Board may unilaterally amend
the Plan as it deems appropriate to ensure compliance with Rule 16b-3. Except as
provided in the preceding sentence, any change or addition to the Plan shall
not, without the written consent of a Participant who is adversely affected
thereby, alter any rights or benefits of the Participant pursuant to the Plan.

A-3

<PAGE>

13. RIGHTS UNDER THE PLAN.

(a) The Plan is an unfunded deferred compensation arrangement.
Participation in the Plan and the right to receive payments hereunder shall not
give a Participant any proprietary interest in the Company or any subsidiary of
the Company, or in any of their assets. A Participant shall, for all purposes
under the Plan, be a general creditor of the Company.

(b) During the lifetime of a Participant, the interests of the Participant
under the Plan cannot be assigned, anticipated, sold, encumbered or pledged and
shall not be subject to the claims of the Participant's creditors. In the event
of a Participant's death, the Participant's rights and interests under the Plan
shall be paid, as provided in Section 6, to the Participant's beneficiary who
has been designated in accordance with Section 14 of the Plan.

14. BENEFICIARY. A Participant may designate in writing on a form provided
by and delivered to the Company, one or more beneficiaries to receive any
distribution under the Plan after the death of the Participant. If a Participant
fails to designate a beneficiary, or no designated beneficiary survives the
Participant, any distribution to be made with respect to the Participant's
Account after his death shall be made to the personal representative of the
Participant's estate. When a provision of this Plan refers to the distribution
of an Account to a Participant, the term 'Participant' shall include the
Participant's beneficiary designed pursuant to this Section 14.

15. NOTICE. All notices and other communications required or permitted to
be given under the Plan shall be in writing and shall be deemed to have been
duly given if delivered personally or mailed first class, postage prepaid, as
follows: (a) if to the Company, at its principal business address, to the
attention of its Corporate Secretary, and (b) if to any Participant, at his last
address known to the sender at the time the notice or other communication is
sent.

16. INTERPRETATION AND CONSTRUCTION. This Plan is intended to comply with
the provisions of Rule 16b-3 and shall be construed in a manner consistent
therewith. The terms of this Plan are subject to all present and future rulings
of the Securities and Exchange Commission with respect to Rule 16b-3. If any
provision of the Plan would cause the Plan to fail to meet the requirements of
Rule 16b-3, then that provision of the Plan shall be void and of no effect. To
the extent not inconsistent with the requirements of Rule 16b-3, the Plan shall
be construed and enforced according to the laws of the State of New Jersey.
Headings and captions are for convenience of reference only and have no
substantive meaning.

A-4

<PAGE>

<PAGE>
EXHIBIT B

UNION CAMP CORPORATION
DIRECTORS' STOCK OPTION PLAN

1. PURPOSE

The purpose of the Union Camp Corporation Directors' Stock Option Plan (the
'Plan') is to encourage non-employee directors of Union Camp Corporation (the
'Company') to acquire a proprietary interest in the future of the Company
through the ownership of the $1.00 par value common stock of the Company
('Common Stock'). It is also expected that the Plan will encourage qualified
persons to serve as directors of the Company.

2. ADMINISTRATION OF THE PLAN

The Plan shall be administered by the Board of Directors of the Company
(the 'Board'). In administering the Plan, the Board may adopt rules and
regulations for carrying out the Plan. The interpretation and decision with
regard to any question arising under the Plan made by the Board shall be final
and conclusive on all directors participating or eligible to participate in the
Plan.

3. SHARES OF STOCK SUBJECT TO THE PLAN

The total number of shares that may be issued pursuant to options granted
under the Plan is three hundred fifty thousand (350,000) shares of Common Stock,
subject to adjustment as provided in Paragraph 7. Any shares subject to an
option which for any reason expires or is terminated unexercised may again be
subject to an option under the Plan.

4. ELIGIBILITY

Directors who are not employees of the Company or any of its subsidiaries
are eligible to be granted options under the Plan. The directors who shall
receive options under the Plan shall be selected from time to time by the Board
and the Board shall determine the number of shares to be covered by the option
granted to each such director.

5. DURATION OF THE PLAN

The Plan shall become effective as of January 1, 1998, subject to its
approval by the stockholders of the Company. The Plan shall terminate upon the
earliest of the following to occur: (a) the adoption of a resolution by the
Board terminating the Plan, provided, however, options then outstanding shall
extend beyond such termination date; or (b) the date all shares of Common Stock
subject to options are purchased or all unexercised options have expired.

6. TERMS AND CONDITIONS OF STOCK OPTIONS

All options granted under this Plan shall be evidenced by an agreement
between the Company and the optionee and shall be subject to all the applicable
provisions of the Plan, including the following terms and conditions, and such
other terms and conditions not inconsistent therewith as the Board shall
determine.

(a) The option price per share shall be determined by the Board, but shall
not be less than 100% of the fair market value of a share of Common Stock on the
date the option is granted. The fair market value shall be the mean of the high
and low sales prices for the Common Stock as reported on the Composite Tape for
New York Stock Exchange issues for the day on which the option is granted. If
there is no sale of the shares on such Exchange on the date the option is
granted, the mean of the bid and asked prices on such Exchange at the close of
the market on such date shall be deemed to be the fair market value of the
Common Stock. In the event that the method for determining the fair market value
of the Common Stock provided for in this Paragraph 6 (a) shall not be
practicable, then the fair

B-1

<PAGE>

market value per share shall be determined by such other reasonable method as
the Board shall, in its discretion, select and apply at the time of grant of the
option concerned.

(b) Each option shall be exercisable during and over such period ending not
later than ten years from the date it was granted, as may be determined by the
Board and stated in the option grant agreement.

(d) Each option may be exercised by giving written notice to the Company
specifying the number of shares to be purchased, which shall be accompanied by
payment in full including applicable taxes, if any. Payment shall be (i) in
cash, or (ii) in shares of Common Stock already owned by the optionee (the value
of such Common Stock shall be its fair market value on the date of exercise as
determined under Paragraph 6 (a)), or (iii) by a combination of cash and shares
of Common Stock. No option shall be exercised for less than the lesser of 50
shares or the full number of shares for which the option is then exercisable. No
optionee shall have any rights to dividends or other rights of a shareholder
with respect to shares of Common Stock subject to his option until he has given
written notice of exercise of his option and paid in full for such shares.

(e) Each option may provide, or be amended to provide, that the optionee
may exercise the option without payment of the option price by delivery to the
Company of an exercise notice and irrevocable instructions to deliver shares of
Common Stock directly to the stockbroker named therein in exchange for payment
of the option price by such stockbroker to the Company.

(f) Upon an optionee's death, his option may thereafter be immediately
exercised by the legal representative of his estate or by the legatee of the
optionee under his last will until the expiration of the option.

(g) Except as otherwise provided in this Paragraph 6(g), the option by its
terms shall be personal and shall not be transferable by the optionee otherwise
than by will or by the laws of descent and distribution. During the lifetime of
an optionee, the option shall be exercisable only by him. The Board may, in its
discretion, authorize any option to be on terms which permit transfer of all or
a portion of such option to members of the optionee's immediate family or a
trust or partnership, or similar vehicle, established solely for the benefit of,
or the partners or members of which are solely, such family members, provided
that the option grant agreement expressly permits such transferability and any
transfer of such option shall be in accordance with any other terms, conditions,
rules and limitations prescribed by the Board and/or set forth in the applicable
option grant agreement. Following the valid transfer of any such option, the
transferred option shall continue to be subject to the same terms and conditions
as were applicable to such option immediately prior to such transfer, provided
that the transferee of such option shall be treated under the Plan and the
applicable agreement as the optionee.

7. CHANGES IN CAPITAL/CHANGE IN CONTROL

Upon changes in the Common Stock by a stock dividend, stock split, reverse
split, subdivision, recapitalization, merger, consolidation (whether or not the
Company is a surviving corporation) combination or exchange of shares,
separation, reorganization or liquidation, the number and class of shares
available under the Plan as to which options may be granted, the number and
class of shares under each option and the option price per share shall be
correspondingly adjusted by the Board, such adjustments to be made in the case
of outstanding options without change in the total price applicable to such
options; provided, however, no such adjustments shall be made in the case of
stock dividends aggregating in any fiscal year of the Company not more than 10%
of the Common Stock issued and outstanding at the beginning of such year or in
the case of one or more splits, subdivisions or combinations of the Common Stock
during any fiscal year of the Company resulting in an increase or decrease of
not more than 10% of the Common Stock issued and outstanding at the beginning of
such year.

B-2

<PAGE>

8. USE OF PROCEEDS

Proceeds from the sale of shares pursuant to options granted under this
Plan shall constitute general funds of the Company.

9. AMENDMENTS

The Board may amend, alter or discontinue the Plan, including without
limitation any amendment considered to be advisable by reason of changes to the
Internal Revenue Code, but no amendment, alteration or discontinuation shall be
made which would impair the rights of any holder of an option theretofore
granted, without his consent, or which, without the approval of the
shareholders, would:

(a) Except as is provided in Paragraph 7 of the Plan, increase the
total number of shares reserved for the purpose of the Plan.

(b) Decrease the option price to less than 100% of the fair market
value of a share of Common Stock on the date of the granting of the option.

The Board may amend the terms of any option heretofore granted,
retroactively or prospectively, but no such amendment shall impair the rights of
any holder without his consent.

10. GOVERNING LAW

The Plan shall be governed by and construed in accordance with the laws of
the State of New Jersey.

B-3

APPENDIX 1
PROXY CARD

[ ]
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ITEMS 1, 2, 3 AND 4.
(1) Election FOR all nominees WITHHOLD AUTHORITY to vote *EXCEPTIONS
of Directors listed below for all nominees listed below

Nominees: J. H. Ballengee, A. D. McLaughin, G. J. Sella, Jr. and T. D. Simmons
(INSTRUCTIONS: To withhold authority to vote for any individual nominee, mark
the "Exceptions" box and write that nominee's name in the space provided below.)
*Exceptions_____________________________________________________________________

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<CAPTION>
FOR AGAINST ABSTAIN The Board of Directors recommends a vote
----------------------------------------
"AGAINST" Item 5.
-----------------
<S> <C> <C> <C> <C> <C> <C> <C>
(2) Ratification of appointment of
independent accountants. [ ] [ ] [ ]

FOR AGAINST ABSTAIN
(3) The approval of the Deferred (5) Stockholder proposal to endorse
Stock Unit Plan for Outside [ ] [ ] [ ] the CERES Principles. [ ] [ ] [ ]
Directors.

(4) The approval of the Outside
Directors' Stock Option Plan. [ ] [ ] [ ]

Please mark this box Change of Address
if you plan to attend [ ] and/or Comments [ ]
the annual meeting Mark Here

Please sign exactly as your names appear. If Executor,
Trustee, etc., give full title. If stock is
registered in two names, both should sign.

Dated:............................................, 1998

--------------------------------------------------------
Votes MUST be Signature(s)
indicated (x)
Please Sign, Date and Return the Proxy Card in Black or [X]--------------------------------------------------------
Promptly Using the Enclosed Envelope. Blue ink. Signature(s)

<PAGE>

[LOGO] UNION CAMP CORPORATION
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR ANNUAL MEETING OF STOCKHOLDERS
APRIL 28, 1998

The undersigned hereby appoints W. CRAIG McCLELLAND, JERRY H. BALLENGEE and
DIRK R. SOUTENDIJK, and each of them, proxies, with power of substitution and
revocation, to vote all Common Stock of UNION CAMP CORPORATION standing in the
name of the undersigned at the annual meeting of stockholders of said
corporation at the Union Camp Corporation Headquarters, 1600 Valley Road, Wayne,
New Jersey, on Tuesday, April 28, 1998 at 11:00 A.M., and any and all
adjournments thereof, with all the powers which the undersigned would possess if
personally present, upon and in respect of the following matters and in their
discretion for the transaction of such other business as may properly come
before the meeting; all set forth in the Proxy Statement dated March 16, 1998.

SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS INSTRUCTED ON THE REVERSE
SIDE. IN THE ABSENCE OF ANY INSTRUCTIONS, SUCH SHARES WILL BE VOTED FOR ITEMS 1,
2, 3 AND 4, AND, IF PROPERLY PRESENTED AT THE MEETING, AGAINST ITEM 5, ALL AS
REFERRED TO ON THE REVERSE SIDE.

(Continued, and to be SIGNED on the reverse side.)

UNION CAMP CORPORATION
P.O. BOX 11188
NEW YORK, N.Y. 10203-0188

<PAGE>

[LOGO]

APPENDIX 2
LETTER TO PLAN PARTICIPANTS

1600 Valley Road Wayne, NJ 07470 Telephone 973-628-2000 Fax 973-628-2722

March 16, 1998

TO: PARTICIPANTS HAVING COMPANY STOCK ALLOCATED TO THEIR
ACCOUNTS UNDER THE FOLLOWING PLANS:

The Union Camp Corporation Salaried Employees' Savings and Investment Plan

The Union Camp Corporation Employees' Investment Plan

The Union Camp Corporation Employees' Savings and Investment Plan

The Union Camp Corporation Franklin Employee Investment Plan

The Union Camp Corporation Prattville Employee Investment Plan

The Union Camp Corporation Savannah Employee Investment Plan and

The Puerto Rico Container Company Employees' Savings Plan

Bush Boake Allen Inc. Employees' Savings and Investment Plan

Enclosed is a copy of Union Camp Corporation's 1997 Annual Report and a copy of
the Notice of the 1998 Annual Meeting and Proxy Statement, together with a
Confidential Voting Instructions form.

You are entitled to direct T. Rowe Price Trust Company, as Trustee of each of
the plans referred to above, how to vote the shares of Union Camp Common Stock
allocated to your plan account. Please date, mark as appropriate and sign the
enclosed Confidential Voting Instructions form and return it in the enclosed
envelope to T. Rowe Price Trust Company, c/o Proxy Tabulator, P.O. Box 9122,
Hingham, MA 02043-9717. T. Rowe Price Trust Company will vote the shares in your
account as you direct. If you do not return the enclosed Confidential Voting
Instructions form, your shares will be voted in the same proportions as shares
are actually voted in the plan in which you are a participant.

Your vote is important. Please complete and return the voting instructions form
to T. Rowe Price Trust Company, c/o Proxy Tabulator, P.O. Box 9122, Hingham, MA
02043-9717 as soon as possible.

Very truly yours,

DIRK R. SOUTENDIJK

Dirk R. Soutendijk
Secretary

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