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EXHIBIT 10.06

FOURTH AMENDED AND RESTATED
EASTMAN DIRECTORS' DEFERRED COMPENSATION PLAN

EASTMAN CHEMICAL COMPANY

FOURTH AMENDED AND RESTATED
EASTMAN DIRECTORS' DEFERRED COMPENSATION PLAN

TABLE OF CONTENTS Page

Section 1. Definitions

Section 2. Deferral of Compensation

Section 3. Time of Election of Deferral

Section 4. Hypothetical Investments

Section 5. Deferrals and Crediting Amounts to Accounts

Section 6. Deferral Period

Section 7. Investment in the Stock Account and Transfers Between Accounts

Section 8. Payment of Deferred Compensation

Section 9. Payment of Deferred Compensation After Death

Section 10. Withdrawals

Section 11. Participant's Rights Unsecured

Section 12. No Right to Continued Service

Section 13. Statement of Account

Section 14. Deductions

Section 15. Administration

Section 16. Amendment

Section 17. Change in Control

Section 18. Governing Law

Section 19. Successors and Assigns

Section 20. Compliance with SEC Regulations

FOURTH AMENDED AND RESTATED
EASTMAN DIRECTORS' DEFERRED COMPENSATION PLAN

Preamble. The Fourth Amended and Restated Eastman Directors' Deferred
Compensation Plan is an unfunded, non-qualified deferred compensation
arrangement for non-employee members of the Board of Directors of Eastman
Chemical Company (the "Company"). Under the Plan, each Eligible Director is
annually given an opportunity to elect to defer payment of part of his or her
compensation for serving as a Director. This Plan originally was adopted
effective January 1, 1994, was amended and restated effective as of December 1,
1994 and as of May 2, 1996, and of October 10, 1996, as of further amended and
restated effective as of December 3, 1998.

Section 1. Definitions.

Section 1.1. "Account" means the Interest Account or the Stock Account.

Section 1.2. "Board" means the Board of Directors of the Company.

Section 1.3. "Change In Control" means a change in control of the Company
of a nature that would be required to be reported (assuming such event
has not been "previously reported") in response to Item 1(a) of a Current
Report on Form 8-K, as in effect on August 1, 1993, pursuant to Section
13 or 15(d) of the Exchange Act; provided that, without limitation, a
Change In Control shall be deemed to have occurred at such time as (i)
any "person" within the meaning of Section 14(d) of the Exchange Act,
other than the Company, a subsidiary of the Company, or any employee
benefit plan(s) sponsored by the Company or any subsidiary of the
Company, is or has become the "beneficial owner," as defined in Rule
13d-3 under the Exchange Act, directly or indirectly, of 25% or more of
the combined voting power of the outstanding securities of the Company
ordinarily having the right to vote at the election of directors;
provided, however, that the following will not constitute a Change In
Control: any acquisition by any corporation if, immediately following
such acquisition, more than 75% of the outstanding securities of the
acquiring corporation ordinarily having the right to vote in the election
of directors is beneficially owned by all or substantially all of those
persons who, immediately prior to such acquisition, were the beneficial
owners of the outstanding securities of the Company ordinarily having the
right to vote in the election of directors; or (ii) individuals who
constitute the Board on January 1, 1994 (the "Incumbent Board") have
ceased for any reason to constitute at least a majority thereof, provided
that: any person becoming a director subsequent to January 1, 1994 whose
election, or nomination for election by the Company's shareowners, was
approved by a vote of at least three-quarters (3/4) of the directors
comprising the Incumbent Board (either by a specific vote or by approval
of the proxy statement of the Company in which such person is named as a
nominee for director without objection to such nomination) shall be, for
purposes of the Plan, considered as though such person were a member of
the Incumbent Board; or (iii) upon approval by the Company's shareowners
of a reorganization, merger or consolidation, other than one with respect
to which all or substantially all of those persons who were the
beneficial owners, immediately prior to such reorganization, merger or
consolidation, of outstanding securities of the Company ordinarily having
the right to vote in the election of directors own, immediately after
such transaction, more than 75% of the outstanding securities of the
resulting corporation ordinarily having the right to vote in the election
of directors; or (iv) upon approval by the Company's stockholders of a
complete liquidation and dissolution of the Company or the sale or other
disposition of all or substantially all of the assets of the Company
other than to a subsidiary of the Company. Notwithstanding the occurrence
of any of the foregoing, the Board of Directors may determine, if it
deems it to be in the best interest of the Company, that an event or
events otherwise constituting a Change in Control shall not be so
considered. Such determination shall be effective only if it is made by
the Board of Directors prior to the occurrence of an event that otherwise
would be or probably will lead to a Change In Control or after such event
if made by the Board of Directors a majority of which is composed of
directors who were members of the Board immediately prior to the event
that otherwise would be or probably will lead to a Change In Control.

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Section 1.4. "Committee on Directors" means the Committee on Directors
of the Board.

Section 1.5. "Common Stock" means the $.01 par value common stock of the
Company.

Section 1.6. "Company" means Eastman Chemical Company.

Section 1.7. "Deferrable Amount" means an amount equal to the sum of the
Eligible Director's cash compensation, including retainer, meeting fees,
and any other compensation otherwise payable in cash.

Section 1.8. "Eligible Director" means a member of the Board of Directors
of the Company who is not an employee of the Company or any subsidiary of
the Company.

Section 1.9. "Enrollment Period" means the period designated by the
Committee on Directors each year; provided however, that such period
shall end on or before December 31 of each year.

Section 1.10. "Exchange Act" means the Securities Exchange Act of 1934,
as amended.

Section 1.11. "Interest Account" means the account established by the
Company for each Participant for compensation deferred pursuant to this
Plan and which shall bear interest as described in Section 4.1 below. The
maintenance of individual Interest Accounts is for bookkeeping purposes
only.

Section 1.12. "Interest Rate" means the monthly average of bank prime
lending rates to most favored customers as published in The Wall Street
Journal, such average to be determined as of the last day of each month.

Section 1.13. "Market Value" means the closing price of the shares of
Common Stock on the New York Stock Exchange on the day on which such
value is to be determined or, if no such shares were traded on such day,
said closing price on the next business day on which such shares are
traded; provided, however, that if at any relevant time the shares of
Common Stock are not traded on the New York Stock Exchange, then "Market
Value" shall be determined by reference to the closing price of the
shares of Common Stock on another national securities exchange, if
applicable, or if the shares are not traded on an exchange but are traded
in the over-the-counter market, by reference to the last sale price or
the closing "asked" price of the shares in the over-the-counter market as
reported by the National Association of Securities Dealers Automated
Quotation System (NASDAQ) or other national quotation service.

Section 1.14. "Plan" means this Fourth Amended and Restated Eastman
Directors' Deferred Compensation Plan.

Section 1.15. "Participant" means an Eligible Director who elects for one
or more years to defer compensation pursuant to this Plan.

Section 1.16. "Stock Account" means the account established by the
Company for each Participant, the performance of which shall be measured
by reference to the Market Value of Common Stock. The maintenance of
individual Stock Accounts is for bookkeeping purposes only.

Section 1.17. "Valuation Date" means each business day.

Section 2. Deferral of Compensation. An Eligible Director may elect to defer
receipt of all or any portion of his or her Deferrable Amount to his or her
Interest Account and/or Stock Account. No deferral shall be made of any
compensation payable after termination of the Eligible Director's service on the
Board.

Section 3. Time of Election of Deferral. An Eligible Director who wishes to
defer compensation must irrevocably elect to do so during the applicable
Enrollment Period. The Enrollment Period shall end on or before December 31 of
the calendar year immediately preceding the year in which the Eligible
Director's applicable Deferrable Amount will be earned. Elections shall be made
annually.

Section 4. Hypothetical Investments.

Section 4.1. Interest Account. Amounts in a Participant's Interest
Account are hypothetically invested in an interest bearing account which
bears interest computed at the Interest Rate, compounded monthly.

Section 4.2. Stock Account. Amounts in a Participant's Stock Account are
hypothetically invested in units of Common Stock. Amounts deferred into a
Stock Account are recorded as units of Common Stock, and fractions
thereof, with one unit equating to a single share of Common Stock. Thus,
the value of one unit shall be the Market Value of a single share of
Common Stock. The use of units is merely a bookkeeping convenience; the
units are not actual shares of Common Stock. The Company will not reserve
or otherwise set aside any Common Stock for or to any Stock Account. The
maximum number of Common Stock units that may be hypothetically purchased
by deferral of compensation to Stock Accounts under this Plan is 80,000.

Section 5. Deferrals and Crediting Amounts to Accounts.

Section 5.1. Manner of Electing Deferral. An Eligible Director may elect
to defer compensation by executing and returning to the Committee on
Directors a deferred compensation form provided by the Company. The form
shall indicate: (i) the amount of Deferrable Amount to be deferred; and
(ii) the portion of the deferral to be credited to the Participant's
Interest Account and Stock Account, respectively. An election to defer
compensation shall be irrevocable following the end of the applicable
Enrollment Period, but the portion of the deferral to be credited to the
Participant's Interest Account and Stock Account, respectively, may be
reallocated by the Participant in the manner specified by the Committee
on Directors or its authorized designee through and including the
business day immediately preceding the date on which the deferred amount
is credited to the Participant's Accounts pursuant to Section 5.2.

Section 5.2. Crediting of Amounts to Accounts. Amounts to be deferred
shall be credited to the Participant's Interest Account and/or Stock
Account, as applicable, as of the date such amounts are otherwise
payable.

Section 6. Deferral Period. Subject to Sections 9, 10 and 17 hereof, the
compensation which a Participant elects to defer under this Plan shall be
deferred until the Participant ceases to serve as a member of the Board. Any
such election shall be made during the applicable Enrollment Period on the
deferred compensation form referenced in Section 5 above. The payment of a
Participant's account shall be governed by Sections 8, 9, 10 and 17, as
applicable.

Section 7. Investment in the Stock Account and Transfers Between Accounts.

Section 7.1. Election Into the Stock Account. If a Participant elects to
defer compensation into his or her Stock Account, his or her Stock
Account shall be credited, as of the date described in Section 5.2, with
that number of units of Common Stock, and fractions thereof, obtained by
dividing the dollar amount to be deferred into the Stock Account by the
Market Value of the Common Stock as of such date.

Section 7.2. Transfers Between Accounts. A Participant may direct that
all or any portion, designated as a whole dollar amount, of the existing
balance of one of his or her Accounts be transferred to his or her other
Account, effective as of (i) the date such election is made, if and only
if such election is made prior to the close of trading on the New York
Stock Exchange on a day on which the Common Stock is traded on the New
York Stock Exchange, or (ii) if such election is made after the close of
trading on the New York Stock Exchange on a given day or at any time on a
day on which no sales of Common Stock are made on the New York Stock
Exchange, then on the next business day on which the Common Stock is
traded on the New York Stock Exchange (the date described in (i) or (ii),
as applicable, is referred to hereinafter as the election's "Effective
Date"). Such election shall be made in the manner specified by the
Committee on Directors or its authorized designee; provided, however,
that a Participant may only elect to transfer between his or her Accounts
if he or she has made no election within the previous six months to
effect an "opposite way" fund-switching (i.e., transfer out versus
transfer in) transfer into or out of the Stock Account or any other
"opposite way" intra-plan transfer or plan distribution involving a
Company equity securities fund which constitutes a "Discretionary
Transaction" as defined in Rule 16b-3 under the Exchange Act.

Section 7.3. Transfer Into the Stock Account. If a Participant elects
pursuant to Section 7.2 to transfer an amount from his or her Interest
Account to his or her Stock Account, effective as of the election's
Effective Date, (i) his or her Stock Account shall be credited with that
number of units of Common Stock, and fractions thereof, obtained by
dividing the dollar amount elected to be transferred by the Market Value
of the Common Stock on the Valuation Date immediately preceding the
election's Effective Date; and (ii) his or her Interest Account shall be
reduced by the amount elected to be transferred.

Section 7.4. Transfer Out of the Stock Account. If a Participant elects
pursuant to Section 7.2 to transfer an amount from his or her Stock
Account to his or her Interest Account, effective as of the election's
Effective Date, (i) his or her Interest Account shall be credited with a
dollar amount equal to the amount obtained by multiplying the number of
units to be transferred by the Market Value of the Common Stock on the
Valuation Date immediately preceding the election's Effective Date; and
(ii) his or her Stock Account shall be reduced by the number of units
elected to be transferred.

Section 7.5. Dividend Equivalents. Effective as of the payment date for
each cash dividend on the Common Stock, the Stock Account of each
Participant who had a balance in his or her Stock Account on the record
date for such dividend shall be credited with a number of units of Common
Stock, and fractions thereof, obtained by dividing (i) the aggregate
dollar amount of such cash dividend payable in respect of such
Participant's Stock Account (determined by multiplying the dollar value
of the dividend paid upon a single share of Common Stock by the number of
units of Common Stock held in the Participant's Stock Account on the
record date for such dividend); by (ii) the Market Value of the Common
Stock on the Valuation Date immediately preceding the payment date for
such cash dividend.

Section 7.6. Stock Dividends. Effective as of the payment date for each
stock dividend on the Common Stock, additional units of Common Stock
shall be credited to the Stock Account of each Participant who had a
balance in his or her Stock Account on the record date for such dividend.
The number of units that shall be credited to the Stock Account of such a
Participant shall equal the number of shares of Common Stock, and
fractions thereof, which the Participant would have received as stock
dividends had he or she been the owner on the record date for such stock
dividend of the number of shares of Common Stock equal to the number of
units credited to his or her Stock Account on such record date.

Section 7.7. Recapitalization. If, as a result of a recapitalization of
the Company, the outstanding shares of Common Stock shall be changed into
a greater number or smaller number of shares, the number of units
credited to a Participant's Stock Account shall be appropriately adjusted
on the same basis.

Section 7.8. Distributions. Amounts in respect of units of Common Stock
may only be distributed out of the Stock Account by transfer to the
Interest Account (pursuant to Sections 7.2 and 7.4 or 7.10) or withdrawal
from the Stock Account (pursuant to Section 8, 9, 10, or 17), and shall
be distributed in cash. The number of units to be distributed from a
Participant's Stock Account shall be valued by multiplying the number of
such units by the Market Value of the Common Stock as of the Valuation
Date immediately preceding the date such distribution is to occur.

Section 7.9. Responsibility for Investment Choices. Each Participant is
solely responsible for any decision to defer compensation into his or her
Stock Account and to transfer amounts to and from his or her Stock
Account and accepts all investment risks entailed by such decision,
including the risk of loss and a decrease in the value of the amounts he
or she elects to defer into his or her Stock Account.

Section 7.10. Liquidation of Stock Account. Upon the date that a
Participant ceases to serve on the Board, the entire balance, if any, of
the Participant's Stock Account shall automatically be transferred to his
or her Interest Account. For purposes of valuing the units of Common
Stock subject to such a transfer, the approach described in Section 7.8
shall be used.

Section 8. Payment of Deferred Compensation.

Section 8.1. Background. No withdrawal may be made from a Participant's
Account except as provided in this Section 8 and Sections 9, 10 and 17.

Section 8.2. Manner of Payment. Payment of a Participant's Account shall
be made in a single lump sum or annual installments, in the sole
discretion of the Committee on Directors. The maximum number of annual
installments is ten. All payments from the Plan shall be made in cash.

Section 8.3. Timing of Payments. Payments shall be made by the fifth
business day in March and shall commence in any year designated in the
sole discretion of the Committee on Directors, up through the tenth year
following the year in which the Participant ceases to be a member of the
Board for any reason, but in no event shall payment commence later than
the year the Participant reaches age 71.

Section 8.4. Valuation. The amount of each payment shall be equal to the
value, as of the preceding Valuation Date, of the Participant's Account,
divided by the number of installments remaining to be paid.

Section 9. Payment of Deferred Compensation After Death. If a Participant dies
prior to complete payment of his or her Accounts, the balance of such Accounts,
valued as of the Valuation Date immediately preceding the date payment is made,
shall be paid in a single, lump-sum payment to: (i) the beneficiary or
contingent beneficiary designated by the Participant on forms supplied by the
Committee on Directors; or, in the absence of a valid designation of a
beneficiary or contingent beneficiary, (ii) the Participant's estate within 30
days after appointment of a legal representative of the deceased Participant.

Section 10. Withdrawals.

Section 10.1 Acceleration of Payment for Hardship. Upon written approval
from the Company's Vice President, Human Resources, with respect to
Participants other than executive officers of the Company, and by the
Compensation Committee, with respect to Participants who are executive
officers of the Company, and subject to the restrictions in the next two
sentences, a Participant, whether or not he or she is still employed by
the Company or any of its U.S. Subsidiaries, may be permitted to receive
all or part of his or her Accounts if the Company's Vice President, Human
Resources, or the Compensation Committee, as applicable, determines that
an emergency event beyond the Participant's control exists which would
cause such Participant severe financial hardship if the payment of his or
her Accounts were not approved. Any such distribution for hardship shall
be limited to the amount needed to meet such emergency.

Section 10.2 Payment to Individuals. Any participant in the Eastman
Executive Deferred Compensation Plan may at his or her discretion
withdraw at any time all or part of that person's account balance under
the Plan; provided, if this option is exercised the individual will
forfeit to the Corporation 10% of his or her account balance or $50,000,
whichever is less, and will not be permitted to participate in this plan
for a period of 36 months from date any payment to a participant is made
under this section.

Section 10.3 Accelerated Payment. If under Eastman Executive Deferred
Compensation Plan one-half or more of the Participants or one-fifth or
more of the Participants with one-half or more of the value of all
benefits owed exercise their option for immediate distribution in any
consecutive six-month period this will trigger immediate payment to all
Participants of all benefits owed under the terms of the plan. Immediate
payout under this section will not involve reduction of the amounts paid
to Participants as set forth in section 10.2. Any individual that has
been penalized in this six-month period for electing immediate withdrawal
will be paid that penalty, and continuing participation will be allowed,
if payout to all Participants under this section occurs.

Section 10.4 Section 16. A Section 16 Insider may only receive a
withdrawal from his or her Stock Account pursuant to this Section 10 if
he or she has made no election within the previous six months to effect a
fund-switching transfer into the Stock Account or the Eastman Stock Fund
of the Eastman Investment Plan or the Savings and Investment Plan
Appendix, or any other "opposite way" intra-plan transfer into a Company
equity securities fund which constitutes a "Discretionary Transaction" as
defined in Rule 16b-3 under the Exchange Act. If such a distribution
occurs while the Participant is employed by the Company or any of its
U.S. Subsidiaries, any election to defer compensation for the year in
which the Participant receives a withdrawal shall be ineffective as to
compensation earned for the pay period following the pay period during
which the withdrawal is made and thereafter for the remainder of such
year and shall be ineffective as to any other compensation elected to be
deferred for such year.

Section 11. Participant's Rights Unsecured.

The benefits payable under this Plan shall be paid by the Company each year out
of its general assets. To the extent a Participant acquires the right to receive
a payment under this Plan, such right shall be no greater than that of an
unsecured general creditor of the Company. No amount payable under this Plan may
be assigned, transferred, encumbered or subject to any legal process for the
payment of any claim against a Participant. No Participant shall have the right
to exercise any of the rights or privileges of a shareowner with respect to
units credited to his or her Stock Account.

Section 12. No Right to Continued Service. Participation in the Plan shall not
give any Participant any right to remain a member of the Board.

Section 13. Statement of Account. Statements will be sent no less frequently
than annually to each Participant or his or her estate showing the value of the
Participant's Accounts.

Section 14. Deductions. The Company will withhold to the extent required by law
all applicable income and other taxes from amounts deferred or paid under the
Plan.

Section 15. Administration.

Section 15.1. Responsibility. Except as expressly provided otherwise
herein, the Committee on Directors shall have total and exclusive
responsibility to control, operate, manage and administer the Plan in
accordance with its terms.

Section 15.2. Authority of the Committee on Directors. The Committee on
Directors shall have all the authority that may be necessary or helpful
to enable it to discharge its responsibilities with respect to the Plan.
Without limiting the generality of the preceding sentence, the Committee
on Directors shall have the exclusive right: to interpret the Plan, to
determine eligibility for participation in the Plan, to decide all
questions concerning eligibility for and the amount of benefits payable
under the Plan, to construe any ambiguous provision of the Plan, to
correct any default, to supply any omission, to reconcile any
inconsistency, and to decide any and all questions arising in the
administration, interpretation, and application of the Plan.

Section 15.3. Discretionary Authority. The Committee on Directors shall
have full discretionary authority in all matters related to the discharge
of its responsibilities and the exercise of its authority under the Plan
including, without limitation, its construction of the terms of the Plan
and its determination of eligibility for participation and benefits under
the Plan. It is the intent that the decisions of the Committee on
Directors and its action with respect to the Plan shall be final and
binding upon all persons having or claiming to have any right or interest
in or under the Plan and that no such decision or action shall be
modified upon judicial review unless such decision or action is proven to
be arbitrary or capricious.

Section 15.4. Delegation of Authority. The Committee on Directors may
delegate some or all of its authority under the Plan to any person or
persons provided that any such delegation be in writing.

Section 15.5. Restriction on Authority of the Committee on Directors.
Under any circumstances where the Committee on Directors is authorized to
make a discretionary decision concerning a payment of any type under this
Plan to a member of such Committee, the member of the Committee who is to
receive such payment shall take no part in the deliberations or have any
voting or other power with respect to such decision.

Section 16. Amendment. The Board may suspend or terminate the Plan at any time.
In addition, the Board may, from time to time, amend the Plan in any manner
without shareowner approval; provided, however, that the Board may condition any
amendment on the approval of shareowners if such approval is necessary or
advisable with respect to tax, securities, or other applicable laws. No
amendment, modification, or termination shall, without the consent of a
Participant, adversely affect such Participant's accruals in his or her Accounts
as of the date of such amendment, modification, or termination.

Section 17. Change in Control.

Section 17.1. Background. The terms of this Section 17 shall immediately
become operative, without further action or consent by any person or
entity, upon a Change in Control, and once operative shall supersede and
control over any other provisions of this Plan.

Section 17.2. Acceleration of Payment Upon Change in Control. Upon the
occurrence of a Change in Control, each Participant, whether or not he or
she is still a Director, shall be paid in a single, lump-sum cash payment
the balance of his or her Accounts as of the Valuation Date immediately
preceding the date payment is made. Such payment shall be made as soon as
practicable, but in no event later than 90 days after the date of the
Change in Control.

Section 17.3. Amendment On or After Change in Control. On or after a
Change in Control, no action, including, but not by way of limitation,
the amendment, suspension or termination of the Plan, shall be taken
which would affect the rights of any Participant or the operation of this
Plan with respect to the balance in the Participant's Accounts.

Section 17.4 Attorney Fees. The Corporation shall pay all reasonable
legal fees and related expenses incurred by a participant in seeking to
obtain or enforce any payment, benefit or right such participant may be
entitled to under the plan after a Change in Control; provided, however,
the participant shall be required to repay any such amounts to the
Corporation to the extent a court of competent jurisdiction issues a
final and non-appealable order setting forth the determination that the
position taken by the participant was frivolous or advanced in bad faith.

Section 18. Governing Law. The Plan shall be construed, governed and enforced in
accordance with the law of Tennessee, except as such laws are preempted by
applicable federal law.

Section 19. Successors and Assigns. This Plan shall be binding upon the
successors and assigns of the parties hereto.

Section 20. Compliance with SEC Regulations. It is the Company's intent that the
Plan comply in all respects with Rule 16b-3 of the Exchange Act, and any
regulations promulgated thereunder. If any provision of the Plan is found not to
be in compliance with such rule, the provision shall be deemed null and void.
All transactions under the Plan, including, but not by way of limitation, a
Participant's election to defer compensation or transfer Account balances under
Section 7 and hardship withdrawals under Section 10, shall be executed in
accordance with the requirements of Section 16 of the Exchange Act, as amended
and any regulations promulgated thereunder. To the extent that any of the
provisions contained herein do not conform with Rule 16b-3 of the Exchange Act
or any amendments thereto or any successor regulation, then the Committee may
make such modifications so as to conform the Plan to the Rule's requirements.