<PAGE>   1
                      NABISCO, INC. CAPITAL INVESTMENT PLAN
                  (Restated Effective as of December 31, 2000)
<PAGE>   2
                                  NABISCO, INC.
                             CAPITAL INVESTMENT PLAN
                                      INDEX

<TABLE>
<CAPTION>
Article                                                                     Page
-------                                                                     ----

<S>                                                                         <C>
I.    DEFINITIONS......................................................       1

      1.01  Account....................................................       2
      1.02  Administrative Committee...................................       2
      1.03  Affiliated Company.........................................       2
      1.04  Affiliated Plan............................................       2
      1.05  Automatic Enrollment Date..................................       2
      1.06  Basic Contributions........................................       2
      1.07  Basic Contribution Account.................................       2
      1.08  Beneficiary................................................       3
      1.09  Board of Directors.........................................       3
      1.10  Break in Service...........................................       3
      1.11  Code.......................................................       3
      1.12  Committee..................................................       4
      1.13  Company....................................................       4
      1.14  Company Contribution Account...............................       4
      1.15  Compensation...............................................       4
      1.16  Disability.................................................       4
      1.17  Effective Date.............................................       4
      1.18  Eligible Employee..........................................       4
      1.19  Employee...................................................       5
      1.20  Entry Dates................................................       5
      1.21  ERISA......................................................       5
      1.22  Investment Fund............................................       5
      1.23  Job Elimination............................................       5
      1.24  Participant................................................       6
</TABLE>


                                       -i-
<PAGE>   3
                                  NABISCO, INC.
                             CAPITAL INVESTMENT PLAN
                                      INDEX

<TABLE>
<CAPTION>
Article                                                                     Page
-------                                                                     ----

<S>                                                                         <C>
      1.25  Participant Company........................................       6
      1.26  Plan.......................................................       6
      1.27  Plan Year..................................................       6
      1.28  Prior Plan.................................................       6
      1.29  Retirement.................................................       6
      1.30  RJR Plan...................................................       6
      1.31  Rollover Contributions.....................................       6
      1.32  Rollover Contribution Account..............................       6
      1.33  Service....................................................       7
      1.34  Severance Date.............................................       7
      1.35  Supplemental After-Tax Contributions.......................       8
      1.36  Supplemental After-Tax Contribution Account................       8
      1.37  Supplemental Pre-Tax Contribution .........................       8
      1.38  Supplemental After-Tax Contribution Account................       8
      1.39  Surviving Spouse...........................................       8
      1.40  Termination of Employment..................................       9
      1.41  Trustee....................................................       9
      1.42  Trust Fund.................................................       9
      1.43  Valuation Date.............................................       9


II.   PARTICIPATION....................................................      10

      2.01  Eligibility................................................      10
      2.02  Participation..............................................      10
      2.03  Participant Status.........................................      11

III.  CONTRIBUTIONS....................................................      12

      3.01  Participant Basic Contributions............................      12
      3.02  Supplemental Pre-Tax Contributions.........................      12
      3.03  Supplemental After-Tax Contributions.......................      12
      3.04  Company Contributions......................................      12
      3.05  Change in Participant Contributions........................      14

</Table>


                                    - ii -

<PAGE>   4
                                 NABISCO, INC.
                            CAPITAL INVESTMENT PLAN

                                     INDEX
                                    (cont'd)

<TABLE>
<CAPTION>
Article                                                                     Page
-------                                                                     ----

<S>                                                                         <C>
      3.06  Suspension of Participant Contributions....................      14
      3.07  Restrictions on Pre-Tax Contributions......................      14
      3.08  Restrictions on Pre-Tax Contributions......................      16
      3.09  Qualified Military Service.................................      16

IV.   TRUST FUND AND INVESTMENT FUNDS..................................      18

      4.01  The Trust Agreement........................................      18
      4.02  The Trustee................................................      18
      4.03  Separate Funds.............................................      18
      4.04  Investment Funds...........................................      18
      4.05  Temporary Investment.......................................      18
      4.06  Investment of Contributions................................      18
      4.07  Voting by Participants.....................................      19
      4.08  Investment Managers........................................      20
      4.09  Participant Responsibility For Selection of Funds..........      20

V.    ACCOUNT STATEMENTS AND VALUATION.................................      21

      5.01  Valuation of Accounts......................................      21
      5.02  Valuation Upon Withdrawal or Distribution..................      21
      5.03  Statement of Accounts......................................      21

VI.   VESTING AND FORFEITURES..........................................      22

      6.01  Vesting of Participant's Contributions.....................      22
      6.02  Vesting of Company Contributions...........................      22
      6.03  Forfeiture on Termination of Employment....................      23
      6.04  Disposition of Forfeitures.................................      23
      6.05  Restoration of Forfeitures.................................      23

VII.  DISTRIBUTIONS....................................................      24

      7.01  Distribution of Benefits...................................      24
      7.02  Installment Option.........................................      26
      7.03  Proof of Death and Right of Beneficiary....................      26
      7.04  Completion of Appropriate Forms and Procedures.............      26
      7.05  Investment Pending Distribution............................      26
      7.06  Direct Rollovers...........................................      26

</TABLE>


                                    -iii-

<PAGE>   5
                                 NABISCO, INC.
                            CAPITAL INVESTMENT PLAN

                                     INDEX
                                    (cont'd)

<TABLE>
<CAPTION>
Article                                                                     Page
-------                                                                     ----

<S>                                                                         <C>

VIII. WITHDRAWAL PRIOR TO TERMINATION OF EMPLOYMENT
      AND SPECIAL PRE-TAX CONTRIBUTION RULES...........................      28

      8.01  Election to Withdraw from Accounts.........................      28
      8.02  Withdrawal of After-Tax and Company Contributions..........      28
      8.03  Rules Applicable to Withdrawals Prior to Termination
            of Employment..............................................      29
      8.04  Hardship Withdrawals.......................................      29
      8.05  Restrictions on Pre-Tax Contribution Distributions.........      30

IX.   LOANS ...........................................................      31

      9.01  Loan Provisions............................................      31

X.    ADMINISTRATION OF THE PLAN.......................................      33

      10.01 Nabisco Employee Benefits Committee........................      33
      10.02 Administrative Committee...................................      33
      10.03 Authority and Duties of Various Fiduciaries................      34
      10.04 Named Fiduciaries..........................................      36
      10.05 Delegation.................................................      36
      10.06 Multiple Capacities........................................      36

XI.   AMENDMENTS, TERMINATION, PERMANENT
      DISCONTINUANCE OF CONTRIBUTIONS,
      MERGER OR CONSOLIDATION..........................................      37

      11.01 Amendments.................................................      37
      11.02 Termination or Permanent Discontinuance of Contributions...      37
      11.03 Partial Termination........................................      37
      11.04 Benefits in Case of Merger or Consolidation................      37

</TABLE>


                                     -iv-
<PAGE>   6
                                 NABISCO, INC.
                            CAPITAL INVESTMENT PLAN

                                     INDEX
                                    (cont'd)

<TABLE>
<CAPTION>
Article                                                                     Page
-------                                                                     ----
<S>                                                                         <C>
XII. MISCELLANEOUS.....................................................      39

      12.01 Benefits Payable from Trust Fund...........................      39
      12.02 Elections..................................................      39
      12.03 No Right to Continued Employment...........................      39
      12.04 Inalienability of Benefits and Interests...................      39
      12.05 Qualified Domestic Relations Orders........................      39
      12.06 Payments for Exclusive Benefit of Participants.............      39
      12.07 New Jersey Law to Govern...................................      40
      12.08 No Guarantee...............................................      40
      12.09 Address of Record..........................................      40
      12.10 Unlocated Spouse...........................................      40
      12.11 Agent for Process..........................................      40
      12.12 Payments in the Event of Incompetency......................      40
      12.13 Transfer of Accounts to This Plan..........................      40
      12.14 Transfer of Accounts From This Plan to an Affiliated Plan..      43
      12.15 Direct or Indirect Transfer................................      43
      12.16 Payment of Expenses........................................      43
      12.17 Transfer of Accounts to the R. J. Reynolds Tobacco
            Company Capital Investment Plan............................      44
      12.18 Headings...................................................      44

XIII. CLAIM PROCEDURE..................................................      45

      13.01 Initial Determination......................................      45
      13.02 Review.....................................................      45

XIV.  LIMITATION ON BENEFITS...........................................      47

      14.01 Code Section 415 Limits....................................      47
      14.02 Code Section 416 Limits....................................      50
</TABLE>


                                      -v-

<PAGE>   7
                                 NABISCO, INC.
                            CAPITAL INVESTMENT PLAN

                                     INDEX
                                    (cont'd)

<TABLE>
<CAPTION>
Article                                                                     Page
-------                                                                     ----
<S>                                                                         <C>
XV.   SPECIAL PROVISIONS PERTAINING TO TRANSFERS
      FROM RJR NABISCO CAPITAL INVESTMENT PLAN.........................      55


SCHEDULE

Schedule A-- Compensation..............................................      57
</TABLE>


                                     -v-

<PAGE>   8
                      NABISCO, INC. CAPITAL INVESTMENT PLAN

                                  INTRODUCTION

                  WHEREAS, prior to June 14, 1999, RJR Nabisco, Inc. ("RJR")
maintained the RJR Nabisco Capital Investment Plan (the "RJR Plan") for the
benefit of its eligible employees, including those employed by Nabisco, Inc.
(the "Company") and its affiliates ("Eligible Nabisco Employees"); and

                  WHEREAS, on June 14, 1999, RJR was spun-off from its parent
company, RJR Nabisco Holdings Corp. through a distribution to its shareholders
of all of the outstanding shares of the common stock of RJR, and, as a result of
such spin-off, RJR is no longer related to Nabisco, Inc. and its affiliates; and

                  WHEREAS, in connection with such spin-off, effective June 14,
1999, the RJR Plan is maintained by R. J. Reynolds Tobacco Company for the
benefit of its eligible employees and the eligible employees of its affiliates;
and

                  WHEREAS, in light of the foregoing, effective June 14, 1999,
the Eligible Nabisco Employees are no longer eligible to participate in the RJR
Plan; and

                  WHEREAS, effective as of June 14, 1999, the Company desires to
establish the Nabisco, Inc. Capital Investment Plan (the "Plan"), a profit
sharing plan containing Section 401(k) cash or deferred features for the benefit
of the Eligible Nabisco Employees and newly eligible employees of the Company
and its affiliates; and

                  WHEREAS, effective June 14, 1999, the account balances held
under the RJR Plan attributable to the Eligible Nabisco Employees and
forfeitures attributable to individuals who terminated employment prior to June
14, 1999 but would have been employees of the Company or its affiliates on June
14, 1999 but for such termination of employment are being transferred to the
Plan; and

                  WHEREAS, as a result of the acquisition of the common stock of
Nabisco Holdings Corp. by Philip Morris Companies Inc. and the subsequent merger
of Nabisco, Inc. into Kraft Foods North America, Inc., the Plan is hereby
restated and amended effective as of December 31, 2000.




                                       1
<PAGE>   9
                                    ARTICLE I

                                   DEFINITIONS

1.01     Accounts, unless otherwise indicated, means a Participant's Basic,
         Supplemental Pre-Tax, Supplemental After-Tax, and Company Contribution
         Accounts and any subaccounts thereunder. Some Participants may also
         have Rollover Contribution Accounts and After-Tax Basic Contribution
         Accounts.

1.02     Administrative Committee means the Administrative Committee(s) that is
         appointed by the Committee to handle the day-to-day administration of
         the Plan. (See Section 10.02).

1.03     Affiliated Company means the Company and any corporation which is a
         member of a controlled group of corporations (as defined in Section
         414(b) of the Code) which includes the Company; any trade or business
         (whether or not incorporated) which is under control (as defined in
         Section 414(c) of the Code) with the Company; any organization (whether
         or not incorporated) which is a member of an affiliated service group
         (as defined in Section 414(m) of the Code) which includes the Company;
         and any other entity required to be aggregated with the Company
         pursuant to regulations under Section 414(o) of the Code. For purposes
         of Article XIV, the definition of Affiliated Company shall be modified
         in accordance with Code Section 415(h).

1.04     Affiliated Plan means a defined contribution plan sponsored by an
         Affiliated Company.

1.05     Automatic Enrollment Date means, for each Eligible Employee, a date
         determined by the Committee, which date is no earlier than three weeks
         following the date the Eligible Employee first becomes eligible to
         participate in the Plan in accordance with Section 2.01(b).

1.06     Basic Contributions means the contributions of a Participant which are
         credited to his Basic Contribution Account in accordance with Section
         3.01.

1.07     Basic Contribution Account means that portion of the Trust Fund which,
         with respect to any Participant, is attributable to his Basic
         Contributions and any investment earnings or losses thereon, and
         excluding amounts, if any, distributed to the Participant in accordance
         with Section 3.07(c). An After-Tax Basic Contribution Account includes
         that portion of the Trust Fund which, with respect to any Participant,
         is attributable to any After-Tax Basic Contributions which were

                                       2
<PAGE>   10
         transferred to this Plan pursuant to ARTICLE XV, and any investment
         earnings or losses thereon.

1.08     Beneficiary means the beneficiary designated by the Participant under
         the Company's group term life insurance plan, unless the Participant
         has designated any other person or persons (who may be designated
         contingently or successively and which may be an entity other than a
         natural person) on a form supplied by the Administrative Committee to
         receive benefits payable in the event of the death of the Participant;
         provided, however that if the Participant is married at the date of his
         death, the Beneficiary shall be the Participant's Surviving Spouse, and
         any Beneficiary designation that does not name the Participant's
         Surviving Spouse as the Beneficiary shall be void unless it has been
         consented thereto on a form supplied by the Administrative Committee in
         writing by the Participant's Surviving Spouse and such consent (i)
         designated the alternative Beneficiary and/or form of benefit which may
         not be changed without spousal consent, (ii) acknowledges the effect of
         such election, and (iii) is witnessed by a notary public. The
         Participant may, however, revoke his alternate Beneficiary at any time,
         thereby reinstating his Surviving Spouse as sole Beneficiary. In the
         event of the Participant's death without an effective Beneficiary
         designation, any Plan benefits payable shall be paid in equal parts to
         the Participant's surviving children or, if the Participant has no
         surviving children, to the Participant's surviving parents or, if the
         Participant has no surviving parents, to the Participant's surviving
         siblings or, if the Participant has no surviving siblings, to the
         Participant's estate. Section 9.01 (a) should be referred to in the
         event of the death of a Participant with an outstanding loan balance,
         Section 12.05 should be referred to in the event of a Qualified
         Domestic Relations Order and Section 12.12 should be referred to for
         payment in the event of incompetency of a Beneficiary.

1.09     Board of Directors means, prior to August 2001, the Board of Directors
         of Nabisco, Inc. and after July 2001, the Board of Directors of Kraft
         Foods North America, Inc., and any committee authorized by such Board
         to act in its behalf with reference to the Plan.

1.10     Break in Service means any twelve-consecutive-month period beginning on
         a Severance Date during which an Employee does not complete an Hour of
         Service.

1.11     Code means the Internal Revenue Code of 1986 as amended from time to
         time. Reference to any Section or subsection of the Code includes
         reference to any comparable or succeeding provisions of any legislation
         which amends, supplements or replaces such Section or subsection.




                                       3
<PAGE>   11
1.12     Committee means the Nabisco Employee Benefits Committee which shall act
         as the Plan Administrator for the Plan. The Committee shall have the
         duties and powers described in Article X.

1.13     Company means, prior to August 2001, Nabisco, Inc. Subsequent to July
         2001, Company means the Nabisco Biscuit & Snacks Group of Kraft Foods
         North America, Inc. With respect to any corporate act after July 2001,
         Company means Kraft Foods North America, Inc.

1.14     Company Contribution Account means that portion of the Trust Fund
         which, with respect to any Participant, is attributable to any
         contributions made on his behalf by the Company, and any investment
         earnings and gains or losses thereon.

1.15     Compensation means, with respect to any Plan Year, the basic
         compensation and such other forms of compensation paid for employment
         as are listed in Schedule A hereto for the calendar year beginning in
         such Plan Year. Compensation in excess of the limit described in
         Section 401(a)(17) of the Code (subject to cost of living adjustments)
         shall not count for purposes of this Plan.

1.16     Disability means being disabled as determined by the Federal Social
         Security Administration and receiving the Social Security Award.

1.17     Effective Date of this Plan means June 14, 1999.

1.18     Eligible Employee means any person employed by a Participating Company
         in an "eligible category", who is paid from a United States dollar
         payroll maintained in the United States; provided, that except as the
         Board of Directors or the Committee, pursuant to authority delegated to
         it by the Board of Directors, may otherwise provide on a basis
         uniformly applicable to all persons similarly situated, no person shall
         be an "Eligible Employee" for purposes of the Plan:

         (a)      who is excepted by the Committee,

         (b)      whose terms and conditions of employment are determined by a
                  collective bargaining agreement with the Company or a
                  Participating Company which does not make this Plan applicable
                  to him, provided that employee retirement benefits were
                  negotiated thereunder, or

         (c)      who is a "leased employee" as defined in Section 414(n) of the
                  Code and who is required by such Section to be considered an
                  employee of the Company or an Affiliated Company.
                  Notwithstanding the foregoing, if a

                                       4
<PAGE>   12
                  "leased employee" is reclassified as an Employee, years of
                  service as a "leased employee" of the Company or an Affiliated
                  Company shall be considered in computing Service for vesting.

                  Notwithstanding any provision of the Plan to the contrary,
Eligible Employee shall not include any person who becomes an Employee pursuant
to the Asset Purchase Agreement entered into on November 19, 1999 among Favorite
Brands International Holding Corp., Favorite Brands International, Inc., Sather
Trucking Corporation, Trolli, Inc., Nabisco, Inc., Nabisco Brands Company, and
Nabisco Technology Company and who works at a facility in the following
locations.

Favorite Brands International, Inc., and Trolli, Inc. Locations

1.  Bannockburn, Illinois          8.  Pittston, Pennsylvania

2.  Chicago, Illinois              9.  Round Lake, Minnesota

3.  DesPlaines, Nevada             10. New Orleans, Louisiana

4.  Henderson, Nevada              11. Oklahoma City, Oklahoma

5.  Kendallville, Indiana          12. San Bernadino, California

6.  Ligonier, Indiana              13. Creston, Iowa

7.  Chattanooga, Tennessee         14. Plantation, Florida

The exclusion from participation of those Employees covered by the Asset
Purchase Agreement shall not apply beginning as of the date the Nabisco
Retirement Savings Plan and the Nabisco Retirement Plan are merged with the
Plan.

1.19     Employee means any person employed by (or, after July 2001, working at)
         the Company or an Affiliated Company.

1.20     Entry Dates are any business day.

1.21     ERISA means the Employee Retirement Income Security Act of 1974, and as
         is amended from time to time.

1.22     Investment Fund or Funds means the separate funds in which Participant
         and Company Contributions to the Plan are invested in accordance with
         Article IV.

1.23     Job Elimination means the elimination of an existing position at the
         sole discretion of the Company when, because of changing needs or
         circumstances, (i) the job is no longer performed, or (ii) the job is
         still performed, but fewer employees are needed to perform it.

                                       5
<PAGE>   13
1.24     Participant means any person participating in the Plan as provided in
         Article II. Except for purposes of Sections 2.01, 2.02 and 6.02 (ii)
         and Article 3, an Eligible Employee who has made a rollover or transfer
         to the Plan which meets the requirements of Section 12.13 or 12.15 and
         for whom a Rollover Contribution Account is maintained shall be treated
         as a Participant and such Eligible Employee shall become a Participant
         for all purposes after meeting the requirements of Sections 2.01 and
         2.02. In addition, in any Plan Year in which the Plan is top-heavy (as
         defined in Section 14.02) and for purposes of Section 14.02(f),
         "participant" shall include an Eligible Employee not otherwise
         described in the preceding two sentences who shall, pursuant to
         Treasury Regulation Section 1.416-1, Q&A M-10, receive the contribution
         described in Section 14.02(f), and such Eligible Employee shall become
         a Participant for all purposes after meeting the requirements of
         Sections 2.01 and 2.02.

1.25     Participating Company means the Company and any United States
         subsidiary of the Company which is approved by the Committee to
         participate in the Plan. The term shall not include any foreign
         corporations, or units thereof.

1.26     Plan means the Nabisco, Inc. Capital Investment Plan.

1.27     Plan Year means the period from each December 31 through the next
         December 30. The Limitation Year shall be the calendar year.

1.28     Prior Plan means any U.S. qualified plan (or an individual retirement
         account, annuity or bond in which a qualified plan distribution was
         separately invested pursuant to Code Sections 408(d)(3)(A)(ii) and
         (D)(i)).

1.29     Retirement means the normal retirement of a Participant who has
         attained age 65, or the early retirement of a Participant who has
         attained age 55 and who has completed 10 years of service.

1.30     RJR Plan means the RJR Nabisco Capital Investment Plan.

1.31     Rollover Contributions means the amount contributed to the Plan as a
         rollover contribution from a Prior Plan, in accordance with Section
         12.13(b).

1.32     Rollover Contribution Account means that portion of the Trust Fund
         which, with respect to any Eligible Employee, is attributable to his
         Rollover Contributions, and any investment earnings or losses thereon.


                                       6
<PAGE>   14
1.33     Service means all periods during which an Employee is employed by (or,
         after July 2001, working at) the Company, a Participating Company or
         any Affiliated Company commencing with the first day of employment or
         the first day of reemployment and ending with his Severance Date which
         next follows the first day of employment or the first day of
         reemployment, as the case may be. The first day of employment or the
         first day of reemployment shall be deemed to be the first day in which
         the Employee performs an "Hour of Service" (as defined in Department of
         Labor Reg. Section 2530.200b-2) as an Employee. Periods of Service
         commencing on the first day of employment and ending on the first
         Severance Date and commencing on each reemployment date and ending on
         the Severance Date which next follows shall be aggregated on a day by
         day basis and 365 days of aggregate Service shall constitute one year
         of Service. Service shall include any period of authorized part-time
         employment, periods of authorized leave of absence up to a maximum of
         one year, periods of absence due to service in the Armed Forces of the
         United States as required pursuant to Section 414(u) of the Code,
         periods of absence due to unpaid leave taken pursuant to the Family and
         Medical Leave Act of 1993 or similar state laws (to the extent required
         by such laws, but only to the extent such leave is not otherwise
         credited under this Section 1.33), and periods of absence due to
         illness or disability up to a maximum of 12-consecutive months. Service
         shall also include all service credited to an Eligible Employee under
         the RJR Plan prior to June 14, 1999. If an individual who is a
         participant in the RJR Plan on or after June 14, 1999 becomes an
         Eligible Employee on or before June 14, 2000, Service shall also
         include the service credited to such Eligible Employee under the RJR
         Plan in respect of the period commencing on June 14, 1999 and ending on
         June 14, 2000.

         Notwithstanding the preceding paragraph and unless otherwise determined
         by the Committee, Service with an Affiliated Company that was not a
         member of the Nabisco Controlled Group as of December 10, 2000 shall
         only be taken into account subsequent to the time that such corporation
         became an Affiliated Company. Nabisco Controlled Group means Nabisco,
         Inc. and any other corporation that was a member of the controlled
         group of corporations (as defined in Section 1563(a) of the Code) that
         included Nabisco, Inc. as of December 10, 2000.

1.34     Severance Date means the following:

         (a)      the date on which an Employee quits, retires, is discharged,
                  dies or terminates employment following a period of salary and
                  benefit continuation; or


                                       7
<PAGE>   15
         (b)      the first anniversary of the first date of a period in which
                  an Employee remains absent from Service (with or without pay)
                  with the Company or an Affiliated Company for any reason other
                  than quit, retirement, discharge, or death; provided, however,
                  the absence from Service of an Employee receiving benefits
                  under one or more long-term disability plans of the Company or
                  an Affiliated Company is not a severance until the earlier of
                  normal retirement age, the cessation of such disability
                  payments or two consecutive years on long-term disability;
                  provided further that if such an Employee in active employment
                  after his normal retirement age becomes disabled, his
                  Severance Date is the date such long-term disability plan
                  benefits commence or would commence.

                  In the case of an Employee who is absent from work by virtue
                  of (i) the Employee's pregnancy, (ii) birth of the Employee's
                  child, (iii) placement of a child with the Employee by
                  adoption, or (iv) caring for any such child for a period of up
                  to a year immediately following such birth or placement, the
                  Severance Date is the second anniversary of the first day of
                  absence from Service provided that the period between the
                  first and second anniversary of such first day of absence is
                  neither counted as Service nor a Break in Service.

1.35     Supplemental After-Tax Contributions means the contributions which a
         Participant elects to make to the Plan in accordance with Section 3.03.

1.36     Supplemental After-Tax Contribution Account means that portion of the
         Trust Fund which, with respect to any Participant, is attributable to
         his own Supplemental After-Tax Contributions and any investment
         earnings or losses thereon and any subaccounts as may be necessary to
         reflect the provisions of Section 3.07.

1.37     Supplemental Pre-Tax Contributions means the contributions which a
         Participant elects to have the Company make directly to the Plan on
         behalf of the Participant in accordance with Section 3.02.

1.38     Supplemental Pre-Tax Contribution Account means that portion of the
         Trust Fund which, with respect to any Participant, is attributable to
         his own Supplemental Pre-Tax Contributions and any investment earnings
         or losses thereon.

1.39     Surviving Spouse means the person to whom the Participant is married,
         under applicable state law, at the time of the Participant's death and
         to whom the benefits under the Plan shall be payable in the event of
         the Participant's death unless a valid Beneficiary designation and
         consent thereto by the Participant's spouse has been


                                       8
<PAGE>   16
         made and received by the Committee, or unless such benefits are subject
         to a qualified domestic relations order as defined in Section 414(p) of
         the Code.

1.40     Termination of Employment means separation from the employment of the
         Company or an Affiliated Company for any reason, including, but not
         limited to, Retirement, death, Disability, resignation or dismissal;
         provided, however, that transfer in employment between the Company and
         an Affiliated Company shall not be deemed to be a "Termination of
         Employment" and provided further, that if an Employee is rehired by the
         Company or an Affiliated Company within 30 days of his or her
         separation from the employment of the Company or an Affiliated Company,
         such separation shall not be considered to be a "Termination of
         Employment."

1.41     Trustee means a trustee or trustees at any time acting as such under a
         trust agreement or agreements established for purposes of this Plan.

1.42     Trust Fund means the cash and other properties arising from (i)
         contributions made by Participants and by the Participating Companies
         in accordance with the provisions of this Plan, (ii) funds transferred
         from the RJR Plan or Affiliated Plans, and (iii) any investment
         earnings and gains or losses thereon. The Trust Fund is held and
         administered by the Trustee pursuant to Article IV.

1.43     Valuation Date means each business day and any other date the Committee
         deems desirable or necessary to value the Trust Fund in accordance with
         Article V.

When used herein, the masculine shall include the feminine, and the singular
shall include the plural, unless the context clearly indicates a different
meaning.




                                       9
<PAGE>   17

                                   ARTICLE II

                                  PARTICIPATION

2.01     Eligibility.

         (a)      An Eligible Employee who was eligible to participate in the
                  RJR Plan immediately prior to the Effective Date shall be
                  eligible to participate in the Plan on the Effective Date.

         (b)      Any Employee shall be eligible to become a Participant in the
                  Plan as of the first Entry Date coincident with or next
                  following the date he becomes an Eligible Employee.

         (c)      All Eligible Employees of a Participating Company who
                  participate in this Plan shall participate under the terms and
                  conditions herein stated.

         (d)      An Employee who was a participant in the Nabisco Retirement
                  Savings Plan or the Nabisco Retirement Plan on the date that
                  such plan merged with the Plan shall become a Participant as
                  of the Entry Date coinciding with or next following the merger
                  date. All service under any such plan shall be taken into
                  account for determining participation under the Plan.

2.02     Participation.

         (a)      An Eligible Employee may become a Participant on any Entry
                  Date by making application in a manner prescribed by the
                  Committee in which he:

                  (i)      designates the percentage of Compensation to be
                           contributed as Basic Contributions in accordance with
                           Section 3.01;

                  (ii)     designates the percentage of Compensation, if any, to
                           be contributed as Supplemental Pre-Tax and/or
                           Supplemental After-Tax Contributions in accordance
                           with Sections 3.02 and 3.03;

                  (iii)    authorizes applicable payroll deductions; and

                  (iv)     chooses one or more Investment Fund(s).

         (b)      If the Eligible Employee does not make the application
                  contemplated in Section 2.02(a) prior to his Automatic
                  Enrollment Date, such Eligible


                                       10
<PAGE>   18
                  Employee shall become a Participant effective as of his
                  Automatic Enrollment Date and shall be deemed to have (i)
                  authorized payroll deductions for Basic Contributions in
                  accordance with Section 3.01, equal to 3% of his Compensation
                  and (ii) elected to invest such contributions in the Fidelity
                  Asset Manager: Income. Notwithstanding the foregoing, the
                  Eligible Employee may at any time elect a different
                  contribution percentage (including 0%) in accordance with
                  Section 3.05 and/or different Investment Funds in accordance
                  with Section 4.06.

2.03     Participant Status. An Employee who has become a Participant shall
         remain a Participant so long as he remains in the service of the
         Company or an Affiliated Company, and shall cease to be a Participant
         upon his Termination of Employment, except that he shall remain a
         Participant so long as he has an Account balance. Active participation,
         however, including contributions to the Plan by or for a Participant,
         shall automatically be suspended effective as of the Participant's
         Severance Date. Participation in the Plan shall cease as of the date
         Accounts are transferred to an Affiliated Plan pursuant to Section
         12.14.




                                       11
<PAGE>   19
                                   ARTICLE III

                                  CONTRIBUTIONS

3.01     Participant Basic Contributions. Subject to the provisions of Section
         3.07, each Participant may elect that the Participating Company
         contribute from 1% to 6% of his Compensation to the Plan (in 1%
         increments) as Pre-Tax Contributions in lieu of an equal amount being
         paid to him as current cash Compensation. Basic Contributions are
         matched with Company Contributions in accordance with Section 3.04.
         Basic Contributions are made through payroll deductions and are
         credited to Participants' Accounts as soon as reasonably possible
         following the date of payment of the Compensation from which the
         contribution is taken.

3.02     Supplemental Pre-Tax Contributions. Subject to the provisions of
         Section 3.07, a Participant who has authorized the maximum Basic
         Contribution rate of 6% may also make additional pre-tax contributions
         to the Plan by authorizing Supplemental Pre-Tax Contributions of 1% to
         10% of his Compensation (in 1% increments) in lieu of an equal amount
         being paid to him as current cash Compensation. Supplemental Pre-Tax
         Contributions are made through payroll deductions and are credited to
         Participants' Accounts as soon as reasonably possible following the
         date of payment of the Compensation from which the contribution is
         taken.

3.03     Supplemental After-Tax Contributions. A Participant may make
         contributions to the Plan on an after-tax basis, either in lieu of or
         in combination with Pre-Tax Contributions by authorizing Supplemental
         After-Tax Contributions of 1% to 16% of his Compensation (in 1%
         increments); provided that the combined percentage of Compensation for
         Basic and Supplemental Contributions is a minimum of 1% and a maximum
         of 16%. (After-Tax Contributions are referred to as "supplemental" even
         though a Participant may elect to make them prior to authorizing any or
         the full amount of Pre-Tax Basic Contributions). Supplemental After-Tax
         Contributions are made through payroll deductions and are credited to
         Participants' Accounts as soon as reasonably possible following the
         date of payment of the Compensation from which the contribution is
         taken.

3.04     Company Contributions.

         (a)      All Company Contributions shall be made subject to the terms
                  and conditions of this Section 3.04. Prior to August 2001,
                  Company Contributions are made by Nabisco, Inc. After July
                  2001, Company Contributions are made with respect to the
                  Nabisco Biscuit & Snacks Group of Kraft Foods North America,
                  Inc.




                                       12
<PAGE>   20
         (b)      For each Plan Year, the Participating Companies shall
                  contribute an amount which, together with any forfeitures
                  under Article VI, shall produce an allocation to each
                  Participant's Company Contribution Account equal to 50% of
                  such Participant's Basic Contributions for such Plan Year.

         (c)      Each Participating Company's share of Company Contributions
                  for any Plan Year shall be that proportion of the amount of
                  Company Contributions for that year which the Basic
                  Contributions withheld by that Participating Company bears to
                  the total Basic Contributions withheld by all Participating
                  Companies for the Plan Year.

         (d)      In any Plan Year in which the Plan is top-heavy (as defined in
                  Section 14.02) the Participating Companies shall make
                  additional Company Contributions to the extent necessary to
                  comply with the minimum top-heavy contribution requirement as
                  set forth in Section 14.02(f).

         (e)      Each Company Contribution to the Plan is conditioned on its
                  deductibility.

                  In the event that the Commissioner of Internal Revenue,
                  determines that the Plan does not qualify for tax-exempt
                  status under Section 401 of the Code and issues an adverse
                  determination with respect to its initial qualification, the
                  Company Contributions made on or after the date on which such
                  determination is applicable shall be returned to the Company
                  without interest within one year after such determination, but
                  only if the application for determination is made by the time
                  prescribed by law for filing the Company's return for the
                  taxable year in which the Plan was adopted, or such later date
                  as the Secretary of the Treasury may prescribe.

                  In the event that a Company Contribution to the Plan is made
                  by a mistake of fact or all or part of the Company's
                  deductions under Section 404 of the Code for contributions to
                  the Plan are disallowed by the Internal Revenue Service, the
                  portion of the contributions attributable to such mistake of
                  fact or to which such disallowance applies shall be returned
                  to the Company without interest. Any such return shall be made
                  within one year after the making of such contribution by
                  mistake of fact or disallowance of deductions, as the case may
                  be.




                                       13
<PAGE>   21
3.05     Change in Participant Contributions. Subject to the provisions of this
         Article, a Participant may elect to change the percentage of his
         authorized payroll deduction by giving notice to the Committee in such
         manner as the Committee may prescribe. Such changed percentage shall
         become effective beginning with the first payroll period commencing
         after processing such notice. If the Committee makes a mistake-of-fact
         with regard to any contribution, it shall, depending on the
         mistake-of-fact, either (i) cause said contribution to be returned to
         the Participant without restriction or (ii) accept additional
         contributions for the affected period.

3.06     Suspension of Participant Contributions.

         (a)      A Participant may elect to suspend his Basic, Supplemental
                  Pre-Tax or Supplemental After-Tax Contributions by notifying
                  the Committee in advance in the manner prescribed by the
                  Committee. The suspension shall become effective on the first
                  day of the first payroll period commencing on or after
                  processing such request. No Company Contributions shall be
                  made on behalf of a Participant during a period of suspension
                  of Basic Contributions.

         (b)      A Participant who has suspended his Basic, Supplemental
                  Pre-Tax or Supplemental After-Tax Contributions may elect to
                  apply to the Committee to resume his contributions in the
                  manner prescribed by the Committee. The resumption shall
                  become effective as of the first payroll period commencing on
                  or after processing his request.

         (c)      No contributions may be made by a Participant for any period
                  of unpaid absence from Service. A Participant who has ceased
                  to make contributions under the Plan in accordance with this
                  subsection (c) shall again be eligible to resume making
                  contributions on the date he returns to Service as an Eligible
                  Employee.

         (d)      A Participant who has ceased to make contributions under the
                  Plan because he has ceased to be an Eligible Employee but,
                  nevertheless, continues to be an Employee shall again be
                  eligible to resume making contributions on the date he again
                  becomes an Eligible Employee and gives notice to the Committee
                  in the prescribed manner.

3.07     Restrictions on Pre-Tax Contributions.

         (a)      In no event may the sum of the Basic and Supplemental Pre-Tax
                  Contributions made by the Company on behalf of any Participant
                  exceed

                                       14
<PAGE>   22
                  $10,000 (as adjusted in accordance with Code Section
                  402(g)(5)). In the event the dollar limit for pre-tax
                  contributions is reached with respect to a Participant during
                  a calendar year, all additional contributions made on behalf
                  of the Participant for that calendar year will be made on an
                  after-tax basis, including, if necessary, a portion of the
                  contributions that the Participant had designated as Basic
                  Contributions.

         (b)      The Committee shall have the right to establish rules with
                  respect to the making of elections of Pre-Tax Contributions,
                  including, without limitation, the right to require that any
                  such election be made at such time prior to its becoming
                  effective as the Committee shall determine and the right to
                  restrict the Participant's right to change such election. Such
                  contributions are intended to be treated for federal income
                  tax purposes as contributions made by the Company under a
                  qualified cash or deferred arrangement (as defined in Section
                  401(k) of the Code) but shall be treated as if they were
                  contributions by a Participant for the purpose of the Plan
                  except where the Plan expressly indicates otherwise.

         (c)      Notwithstanding any other provision of the Plan, Allocable
                  Excess Pre-Tax Contributions and income allocable thereto
                  shall be distributed no later than April 15 to Participants
                  who claim Allocable Excess Pre-Tax Contributions for the
                  preceding calendar year. "Allocable Excess Pre-Tax
                  Contributions" shall mean the amount of Pre-Tax Contributions
                  for a calendar year that the Participant allocates to this
                  Plan that exceed the limits of Code Section 402(g).

         (d)      The Participant's claim shall be in writing, shall be
                  submitted to the Committee no later than March 1; shall
                  specify the Participant's Allocable Excess Pre-Tax
                  Contributions for the preceding calendar year; and shall be
                  accompanied by the Participant's written statement that if
                  such amounts are not distributed, such Allocable Excess
                  Pre-Tax Contributions, when added to amounts deferred under
                  other plans or arrangements described in Sections 401(k),
                  402(h), 408(k) or 403(b) of the Code, exceed the limit imposed
                  on the Participant by Section 402(g) of the Code for the year
                  in which the deferral occurred. A Participant is deemed to
                  notify the Committee of any Allocable Excess Pre-Tax
                  Contributions that arise by taking into account only those
                  amounts deferred pursuant to this Plan and any other Plans of
                  a Participating Company.

         (e)      The Allocable Excess Pre-Tax Contributions distributed to a
                  Participant with respect to a calendar year shall be adjusted
                  for income and, if there is


                                      15

<PAGE>   23
                  a loss allocable to the Excess Pre-Tax Contributions, shall in
                  no event be less than the lesser of the Participant's Pre-Tax
                  Account under the Plan or the Participant's Pre-Tax
                  Contributions for the Plan Year.

3.08     Code Section 401(k) and 401(m) Nondiscrimination Tests. The Plan is
         subject to the following nondiscrimination tests.

         (a)      Definitions. For purposes of this Section, the following
                  additional definitions shall be used for Plan Years beginning
                  after 1996:

                  (i)      Highly Compensated Employee means an individual who
                           performs service during the determination year and is
                           an Employee who is a 5-percent owner (as defined in
                           Section 416(i)(1) of the Code) at any time during the
                           Plan Year or the preceding Plan Year, or an Employee
                           who received compensation in excess of $80,000
                           (adjusted for changes in the cost of living) and is a
                           member of the "Top-Paid Group" for the preceding Plan
                           Year.

                  (ii)     "Top-Paid Group" means those Employees who are in the
                           top 20-percent of all Employees based on compensation
                           paid by the Company.

         (b)      Average Actual Deferral Percentage Test ("ADP"). For each Plan
                  Year, Participants' Pre-Tax Contributions shall satisfy the
                  requirements described under Section 401(k)(3)(A)(ii) of the
                  Code. The Committee shall have the right to limit Pre-Tax
                  Contributions of Highly Compensated Employees as it deems
                  necessary to satisfy such requirements.

         (c)      Average Actual Contribution Percentage Test ("ACP"). For each
                  Plan Year, matching Company Contributions and Participant
                  After-Tax Contributions shall satisfy the requirements under
                  Section 401(m)(2) of the Code. The Committee shall have the
                  right to limit matching Company Contributions and Participant
                  After-Tax Contributions of Highly Compensated Employees as it
                  deems necessary to satisfy such requirements.

3.09     Qualified Military Service. Any Participant who resumes participation
         in the Plan following a period of qualified military service shall have
         the right to make-up the contributions described in Section 3.01,
         Section 3.02 and Section 3.03 that were not made on account of
         qualified military service as provided under Section 414(u) of the
         Code. The Company will make contributions as described in Section 3.04
         in






                                       16
<PAGE>   24
         the same manner and in the same amount as if the Participant's
         contributions were made during qualified military service.


                                      17
<PAGE>   25
                                   ARTICLE IV

                         TRUST FUND AND INVESTMENT FUNDS

4.01     The Trust Agreement. The Company shall enter into a trust agreement
         which shall contain such provisions as shall render it impossible for
         any part of the corpus of the Trust or income therefrom to be at any
         time used for, or diverted to, purposes other than for the exclusive
         benefit of Participants. Any or all rights or benefits accruing to any
         person under the Plan with respect to any Company Contributions
         deposited under the Trust Agreement shall be subject to all the terms
         and provisions of the Trust which shall specifically incorporate and be
         subject to the provisions of the Plan.

4.02     The Trustee. The Trustee shall be a corporate trustee appointed by the
         Corporate Employee Plans Investment Committee of Philip Morris
         Companies Inc. (the "Philip Morris Committee"), unless such authority
         is transferred to the Compensation and Governance Committee of Kraft
         Foods Inc. (the "Kraft Committee").

4.03     Separate Funds. Subject to Section 4.04, the Trustee shall maintain
         separate Investment Funds within the Fund as are designated by the
         Company.

4.04     Investment Funds. The Philip Morris Committee, unless such authority is
         transferred to the Kraft Committee, shall select the Investment Funds
         offered under the Plan and reserves the right to eliminate or add Funds
         from time to time, including Funds that invest in the common stock of
         an Affiliated Company.

4.05     Temporary Investment. Pending permanent investment of the assets of any
         Investment Fund, the Trustee may temporarily hold cash or make
         short-term investments in obligations of the United States Government,
         commercial paper, an interim investment fund for tax qualified employee
         benefit plans established by the Trustee unless otherwise provided by
         applicable law, or other investments of a short-term nature.

4.06     Investment of Contributions.

         (a)      Election. All Basic Contributions, Supplemental Pre-Tax
                  Contributions, Supplemental After-Tax Contributions and
                  Company Contributions will be invested at the election of the
                  Participant in multiples of 1% in any one or


                                       18
<PAGE>   26
                  combination of the Investment Funds under the Plan, subject to
                  any restrictions imposed on investing in any stock fund. A
                  Participant may make or change an election on any day by
                  giving notice to the Committee in the prescribed manner. Any
                  such election or change of election shall be effective as of
                  the first payroll period after it is processed.

         (b)      Reallocation of Investments. A Participant may elect on any
                  day to reallocate the investment of his Accounts to any one or
                  combination of the Investment Funds in multiples of 1% by
                  giving notice to the Committee in such manner as the Committee
                  may prescribe. The amounts reallocated will be based upon
                  values as of the Valuation Date applicable to the processing
                  of the request.

4.07     Voting by Participants.

         (a)      Voting of Stock Generally. Each Participant shall have the
                  right and shall be afforded the opportunity to instruct the
                  Trustee how to vote that proportionate number of the total
                  number of shares of stock held in any Fund that consists of
                  the common stock of the Company or an Affiliated Company that
                  is the same proportion that the value of his interest bears to
                  the total value of such Fund. Instructions by Participants to
                  the Trustee shall be in such form and pursuant to such
                  regulations as the Committee may prescribe. Any such
                  instructions shall remain in the strict confidence of the
                  Trustee.

         (b)      Tender or Exchange Offers. In the event of a tender or
                  exchange offer for any or all shares of Stock, the Committee
                  shall notify each Participant or Beneficiary and utilize its
                  best efforts to timely distribute or cause to be distributed
                  to him such information as will be distributed to other
                  shareholders of such Stock in connection with any such tender
                  or exchange offer. Each Participant or his Beneficiary shall
                  have the right to instruct the Trustee in writing not to
                  tender or exchange shares of Stock credited to his Account
                  under the Trust Fund. Unless the Trustee determines that ERISA
                  requires it to act otherwise, the Trustee shall not tender or
                  exchange any shares of Stock credited to a Participant's
                  Account under the Trust Fund unless specific instructions to
                  tender or exchange such shares have been received. For
                  purposes of this Section 4.07(b), "Stock" shall mean the stock
                  held in any Fund that consists of the common stock of the
                  Company or an Affiliated Company.


                                       19
<PAGE>   27
4.08     Investment Managers. The Philip Morris Committee may enter into a
         written agreement with or direct the Trustee to enter into an agreement
         with one or more investment managers to manage the investments of one
         or more of the Investment Funds. Such investment managers may include
         legal reserve life insurance companies which enter into group annuity
         contracts with the Trustee. The Philip Morris Committee may remove any
         such investment manager or any successor investment manager, or direct
         the Trustee to do so, and any such investment manager may resign. In
         addition, the Philip Morris Committee may, upon removal or resignation
         of an investment manager, provide for the appointment of a successor
         investment manager. The Kraft Committee shall exercise the duties
         described in this Section 4.08 if such authority is transferred to the
         Kraft Committee from the Philip Morris Committee.

4.09     Participant Responsibility For Selection of Funds. Each Participant is
         solely responsible for the selection of his Investment Funds. Neither
         the Trustee, the Committee, any Administrative Committee, the Company
         nor any of the directors, officers or employees of the Company or any
         Affiliated Company is required to advise a Participant as to the manner
         in which his Accounts should be invested. The fact that a security is
         available to Participants for investment under the Plan shall not be
         construed as a recommendation for the purchase of that security, nor
         shall the designation of any Investment Fund impose any liability on
         the Company, any Affiliated Company, their directors, officers or
         employees, the Trustee, the Committee, or any Administrative Committee.


                                      20
<PAGE>   28
                                    ARTICLE V

                        ACCOUNT STATEMENTS AND VALUATION

5.01     Valuation Of Accounts. As of each Valuation Date, the Accounts of each
         Participant shall be adjusted to reflect any appreciation or
         depreciation in the fair market value and any income earned by each
         Investment Fund in which the Participant's Accounts are invested since
         the prior Valuation Date. Such fair market value shall be the aggregate
         fair market value of all securities or other property held for each
         Investment Fund, plus cash and accrued earnings, less accrued expenses
         and proper charges against each Investment Fund.

         When determining the value of Participant Accounts, any deposits due
         which have not been deposited in the Trust Fund on behalf of the
         Participant shall be added to his Accounts. Similarly, adjustments of
         Accounts for appreciation or depreciation of an Investment Fund shall
         be deemed to have been made as of the Valuation Date to which the
         adjustment relates, even though they are actually made as of a later
         date.

5.02     Valuation Upon Transfer Withdrawal or Distribution. The valuation of
         Accounts for purposes of an in-service withdrawal, a transfer of
         Accounts to another Investment Fund, or a cash distribution shall be as
         described in Section 5.01.

5.03     Statement of Accounts. Each Participant shall be furnished at least
         annually a statement setting forth the value of his Accounts.




                                       21
<PAGE>   29
                                   ARTICLE VI

                             VESTING AND FORFEITURES

6.01     Vesting Of Participant's Contributions. Each Participant's Basic
         Contribution Account, Supplemental Pre-Tax Contribution Account and
         Supplemental After Tax Contribution Account shall at all times be fully
         vested.

6.02     Vesting of Company Contributions. A Participant shall become fully
         vested in his Company Contribution Account upon the earlier of (i)
         completion of 60 months of Service, (ii) 24 months of employment after
         his initial Entry Date, or (iii) the occurrence of any one of the
         following:

         (a)      attainment of age 65,

         (b)      Retirement,

         (c)      Disability,

         (d)      death,

         (e)      termination of employment as a result of Job Elimination,

         (f)      termination of the Plan, or

         (g)      complete discontinuance of Company Contributions.

         With respect to an Employee who becomes a Participant following the
         merger of the Nabisco Retirement Savings Plan (the "Savings Plan") or
         the Nabisco Retirement Plan (the "Retirement Plan") with the Plan, the
         following additional conditions shall apply regarding any amount
         credited to his Company Contribution Account:

         (a)      The vested percentage shall not be less than the vested
                  percentage, determined as of the merger date, of the
                  Employee's (i) matching contributions account and supplemental
                  contribution account under the Savings Plan or (ii) the amount
                  attributable to employer contributions under the Retirement
                  Plan.

         (b)      A "Year of Service" under the Savings Plan shall be equivalent
                  to 12 months of Service under the Plan.

         (c)      The Employee's Entry Date shall be the later of November 19,
                  1999 or the date of hire by the Company.

         (d)      The Employee shall be credited with 12 months of Service for
                  the period beginning July 1, 2000 and ending June 30,


                                       22
<PAGE>   30
                  2001 if he would have been credited with a "Year of
                  Service" shall have the meaning described in Section 8.2 of
                  the Savings Plan.

         (e)      All service under the Savings Plan and the Retirement Plan as
                  of the merger date will be taken into account under the Plan.

         (f)      With respect to a former participant in the Retirement Plan,
                  any such Employee will have a 100% vested interest upon
                  attaining age 55 while employed by the Company.

6.03     Forfeiture on Termination of Employment. If a Participant's employment
         is terminated prior to attainment of age 65 for reasons other than
         Retirement, Disability, death, or Job Elimination the portion, if any,
         of his Company Contribution Account in which he is not vested shall be
         forfeited upon the earlier of (i) the accrual of five (5) consecutive
         Break in Service years, or (ii) the receipt of a cash-out and, under
         circumstances where all Participant Contributions were distributed
         prior to Termination of Employment or there are no Participant
         Contributions, a cash-out will be deemed to have been made on the date
         the Termination of Employment occurred. All forfeitures pursuant to
         (ii) above are subject to the provisions of Section 6.05.

6.04     Disposition of Forfeitures. All forfeitures shall be used to reduce
         Company Contributions otherwise payable to the Plan.

6.05     Restoration of Forfeitures. Any amount forfeited pursuant to the
         provisions of clause (ii) of Section 6.03 shall be restored to the
         Account of a Participant if the Participant is re-employed before he
         accrues five consecutive Break in Service years. The restoration will
         occur without the requirement that the Participant repay to the Plan
         any amounts previously distributed to him.




                                       23
<PAGE>   31
                                   ARTICLE VII

                                  DISTRIBUTIONS

7.01     Distribution Of Benefits.

         (a)      Termination of Employment. A Participant who has a Termination
                  of Employment for reasons other than Retirement, Disability or
                  death shall receive a lump sum distribution of the value of
                  his vested Accounts, subject to the provisions of Section
                  7.01(e). Distribution shall be made as soon as
                  administratively feasible following the valuation of the
                  Participant's Accounts. If the Committee has not received an
                  application for distribution by the time specified in
                  subsection (d) below, a distribution shall automatically be
                  made at such time.

         (b)      Retirement or Disability. A Participant who has a Termination
                  of Employment due to Retirement or Disability shall receive a
                  lump sum distribution of the value of his Accounts.
                  Distribution shall be made as soon as administratively
                  feasible following the valuation of the Participant's
                  Accounts. However, and notwithstanding anything in this Plan
                  to the contrary, a Participant may not postpone payment beyond
                  April 1 of the calendar year following the calendar year in
                  which he attains age 70 1/2. Participants who are not 5%
                  owners (as defined in Code Section 416(i)(1)(B)) and who
                  attained age 70 1/2 prior to January 1, 1988, are not required
                  to have their distribution commence prior to April 1 of the
                  calendar year following the calendar year in which they
                  retire, regardless of their age.

         (c)      Death. The Accounts of a Participant who has died shall be
                  distributed to his Beneficiary in a single lump sum payment.
                  Payment will be made after notification and verification of
                  the Participant's death; provided however, that if the
                  Beneficiary is the Participant's Surviving Spouse, a
                  distribution shall not be made until after a written
                  application for distribution from the Surviving Spouse has
                  been received by the Committee. The Accounts shall be valued
                  as soon as administratively feasible after receipt of the
                  written application for distribution, and distribution shall
                  be made as soon as administratively feasible following the
                  valuation of the Participants Accounts. If the Committee has
                  not received an application for distribution by the time the
                  Participant would have attained age 65, the distribution shall
                  automatically be made at such time.


                                       24
<PAGE>   32
         (d)      Latest Date for Distribution. Distributions to a Participant
                  shall commence no later than the April 1 following the
                  calendar year in which the Participant attains age 70 1/2.

         (e)      Small Lump Sum Cash-Outs. The foregoing notwithstanding, if
                  the value of the Participant's vested Account does not exceed
                  $5,000, a distribution shall be made to the Participant as
                  soon as administratively feasible after a written application
                  for distribution has been received by the Committee, valued as
                  soon as administratively feasible after receipt of such
                  application; provided; however, that if the Committee does not
                  receive a written application for distribution within 90 days
                  after the Participant's Termination of Employment, the Account
                  shall be valued and distribution shall be made as soon as
                  administratively feasible after the expiration of such 90-day
                  period. In no event shall the Account of a Participant which
                  is in excess of the amount of $5,000 be distributed to him or
                  on his behalf prior to the time specified in (d) above without
                  the written consent to the Participant or, if applicable, his
                  Surviving Spouse.

         (f)      QDRO. Notwithstanding subsections (a)-(e) above and Section
                  8.05, if a qualified domestic relations order, as described in
                  Section 12.05, requires the distribution of all or part of a
                  Participant's benefits under the Plan, the establishment or
                  acknowledgment of the alternate payee's rights to benefits
                  under the Plan in accordance with the qualified domestic
                  relations order shall in all events be applied in a manner
                  consistent with the terms of the Plan. Notwithstanding the
                  foregoing, (i) the Committee is authorized, pursuant to such
                  uniform and nondiscriminatory rules as it shall establish
                  which shall be consistent with applicable law and the terms of
                  the applicable qualified domestic relations order, to cash out
                  benefits to which alternate payees may be entitled prior to
                  the date such benefits would otherwise become payable in
                  accordance with the applicable provisions of the Plan, and
                  (ii) in no event shall the recognition of an alternate payee's
                  rights in accordance with this Section 7.01 (f) be deemed to
                  include the right to make a withdrawal pursuant to the
                  provisions of Article VIII or to receive any benefits in the
                  form of a partial payment.

         (g)      Company/Affiliated Company Stock Fund Distributions. With
                  respect to any Investment Fund that consists of the common
                  stock of the Company or an Affiliated Company, a Participant
                  or his Beneficiary may elect that the distribution from any
                  such Investment Fund be made in the form of cash or shares of
                  stock, except that any fractional portion of a share shall be
                  paid in


                                       25
<PAGE>   33
         cash. If a Participant does not make an election in connection with the
         distribution, all amounts shall be paid in cash.

7.02     Installment Option. A Participant or Beneficiary may elect to receive
         the value of his Accounts in monthly or annual installment payments;
         provided, however, such Participant may elect at any time to receive
         the remaining amount credited to his Accounts in a lump-sum
         distribution.

7.03     Proof of Death and Right of Beneficiary. The Committee may require and
         rely upon such proof of death and such evidence of the right of any
         Beneficiary to receive the undistributed value of the Account of a
         deceased Participant as the Committee may deem proper, and its
         determination of death and of the right of such Beneficiary or other
         person to receive payments shall be conclusive.

7.04     Completion of Appropriate Forms and Procedures. The Committee has
         prescribed forms/procedures providing notice to it in order for a
         distribution to be made under the Plan. In the event a Participant or
         Beneficiary does not comply with such procedures before the date a
         distribution becomes payable under the terms of the Plan, distribution
         from such Participant's or Beneficiary's Account may, at the option of
         the Committee (taking into account Section 12.12), be mailed to the
         Address of Record as provided in Section 12.09.

7.05     Investment Pending Distribution.

         (a)      The provisions of Section 4.06 shall continue to apply to the
                  Accounts of inactive Participants, including Participants who
                  have elected the installment option as provided in Section
                  7.02(a).

         (b)      A Participant is not entitled to any interest, dividends or
                  any other form of investment proceeds on his Account for the
                  period between the Valuation Date on which his Account is
                  valued for payment and the date payment is made.

7.06     Direct Rollovers.

         Notwithstanding any provision of the Plan to the contrary that would
         otherwise limit a distributee's election under this Article, a
         distributee may elect, at the time and in the manner prescribed by the
         Plan Administrator, to have any portion of an eligible rollover
         distribution paid directly to an eligible retirement plan specified by
         the distributee in a direct rollover.

                                       26

<PAGE>   34
         (a)      Eligible Rollover Distribution. An eligible rollover
                  distribution is any distribution of all or any portion of the
                  balance to the credit of the distributee, except that an
                  eligible rollover distribution does not include: any
                  distribution that is one of a series of substantially equal
                  periodic payments (not less frequently than annually) made for
                  the life (or life expectancy) of the distributee or the joint
                  lives (or joint life expectancies) of the distributee and the
                  distributee's designated beneficiary, or for a specified
                  period of ten years or more; any distribution to the extent
                  such distribution is required under Section 401(a)(9) of the
                  Code; the portion of any distribution that is not includible
                  in gross income (determined without regard to the exclusion
                  for net unrealized appreciation with respect to employer
                  securities); and any hardship distribution described in
                  Section 401(k)(2)(B) of the Code made after 1998.

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

         (c)      Distributee. A distributee includes an employee or former
                  employee. In addition, the employee's or former employee's
                  surviving spouse and the employee's or former employee's
                  spouse or former spouse who is the alternate payee under a
                  qualified domestic relations order, as defined in Section
                  414(p) of the Code, are distributees with regard to the
                  interest of the spouse or former spouse.

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




                                       27
<PAGE>   35
                                  ARTICLE VIII

                       WITHDRAWAL PRIOR TO TERMINATION OF
                EMPLOYMENT AND SPECIAL PRE-TAX CONTRIBUTION RULES

8.01     Election to Withdraw from Accounts. As of any Valuation Date and
         subject to Sections 8.02, 8.03 and 8.04, a Participant may elect to
         withdraw, in cash only and in a stated amount, all or a portion of the
         value of vested amounts in his Accounts from which withdrawals are
         allowed.

8.02     Withdrawal of After-Tax and Company Contributions. Withdrawals as
         described in Section 8.01 and subject to the rules of Section 8.03
         shall be applied by the Committee against a Participant's Accounts in
         the order and classification as follows:

         Tax-Free Withdrawal: If applicable, the amount in his Supplemental
         After-Tax Account that may be withdrawn on a tax-free basis.

         Regular Withdrawal: The remaining value in his Supplemental After-Tax
         Account, the value in his Rollover Contribution Account, and the vested
         value in his Company Contribution Account.

         Participants with less than 60 months of Plan participation may not
         withdraw (i) after-tax contributions that were matched and have been in
         the Plan for less than 24 months, and (ii) Company Contributions that
         have been in the Plan for less than 24 months.

         Hardship Withdrawal: A Participant who qualifies for a financial
         hardship as defined in Section 8.04 may withdraw up to 100% of the
         amount available under a Regular Withdrawal plus the remaining value of
         his After-Tax Supplemental Account, the remaining vested value of his
         Company Contribution Account, and any dollar amount from his Basic and
         Supplemental Pre-Tax Contribution Accounts, excluding earnings to Basic
         Pre-Tax Contributions and Supplemental Pre-Tax Contributions made under
         this Plan and earnings credited after December 31, 1988 to Pre-Tax
         Contributions made under the RJR Plan.

         Withdrawal Upon Attainment of Age 59 1/2 or Disability: A Participant
         who has attained age 59 1/2 or is totally Disabled may withdraw the
         maximum available under a Regular Withdrawal plus any dollar amount up
         to the remaining vested value of his After-Tax Supplemental Account,
         Company Contributions Account and his Basic and Supplemental Pre-Tax
         Accounts.




                                       28
<PAGE>   36
8.03     Rules Applicable to Withdrawals Prior to Termination of Employment. The
         following rules shall, except as noted in Section 8.04, apply to
         withdrawals under this Article VIII:

         (a)      Withdrawals may only be made by prior notice to the Committee
                  in the manner prescribed by the Committee.

         (b)      Excluding Hardship withdrawals, no more than one withdrawal
                  may be made in any six-month period.

         (c)      Excluding Hardship withdrawals, in no event may a Participant
                  make a withdrawal in an amount less than $1000, or the maximum
                  amount available for withdrawal as a Tax-Free Withdrawal or a
                  Regular Withdrawal, if less.

         (d)      In no event may a Participant elect an order of withdrawal
                  other than set forth in Section 8.02, nor may a Participant
                  select the classification or Investment Fund from which his
                  stated amount of withdrawal will be withdrawn.

         (e)      Payments of withdrawal amounts will be made as soon as
                  practicable after a Participant's election to withdraw.

         (f)      Amounts received from any plan in a trust-to-trust transfer
                  which were subject to Code Section 401 (k) under such plan
                  shall be subject to Code Section 401 (k) requirements under
                  this Plan.

8.04     Hardship Withdrawals. Financial hardship for purposes of Section 8.02
         shall mean that a Participant requires a withdrawal of money for an
         immediate and heavy financial need. Such withdrawal cannot exceed the
         sum of (i) the amount required to meet such need and (ii) any amounts
         necessary to pay any federal, state or local income taxes or penalties
         reasonably anticipated as a result of the distribution. No withdrawal
         shall be permitted unless the hardship cannot reasonably be relieved
         from other sources including distributions (other than hardship
         withdrawals) and nontaxable loans available under this Plan or any
         other plan, through reimbursement or compensation by insurance or
         otherwise, by liquidation of assets to the extent such liquidation
         would not itself cause an immediate and heavy financial need, by
         cessation of all Basic and Supplemental Pre-Tax Contributions or
         Supplemental After-Tax Contributions under the Plan, or by borrowing
         from commercial sources on reasonable commercial terms. Purchase by a
         Participant of a primary residence, the need to prevent eviction or
         foreclosure on the primary


                                       29
<PAGE>   37
         residence of a Participant, post-secondary education tuition, related
         fees, or room and board for a Participant or his dependents and any
         non-reimbursed medical expense of a Participant or his dependents may
         generally be considered situations of heavy financial need, unless
         otherwise governed by law or regulation. The Committee may, under rules
         established by it which are uniformly applicable to all similarly
         situated Participants, determine other circumstances where a
         Participant has a heavy financial need and the decision of the
         Committee as to whether a Participant satisfies the financial hardship
         rule shall be conclusive, unless otherwise governed by law or
         regulation.

8.05     Restrictions on Pre-Tax Contribution Distributions. Notwithstanding any
         other provision in this Plan to the contrary, a Participant's Pre-Tax
         Contribution Account may not be distributed earlier than upon one of
         the following events:

         (a)      The Participant's Retirement, death, Disability or Termination
                  of Employment;

         (b)      The termination of the Plan without the establishment of a
                  successor plan;

         (c)      A Participant's attainment of age 59 1/2;

         (d)      A Participant's hardship, restricted as set forth in Section
                  8.04;

         (e)      The sale or other disposition of the Company or any Affiliated
                  Company to an unrelated corporation, which does not maintain
                  the Plan, of substantially all of the assets used in a trade
                  or business, but only with respect to Employees who continue
                  with the acquiring corporation; or

         (f)      The sale or disposition by the Company or any Affiliated
                  Company of its interest in a subsidiary to an unrelated entity
                  which does not maintain the Plan, but only with respect to
                  Employees who continue employment with the subsidiary.

                  This Section is intended to comply with the earliest
                  distribution requirements of Treasury Reg. 1.401 (k)-1(d) and
                  is not intended to add any forms of distribution not otherwise
                  allowed under the Plan.



                                       30
<PAGE>   38
                                   ARTICLE IX

                                      LOANS

9.01     Loan Provisions. An active Participant may make application to the
         Committee to borrow from the Trust Fund and the Committee may permit
         such a loan upon the conditions hereinafter specified and any other
         rules promulgated by the Committee.

         (a)      Loans shall be made available to all eligible Participants on
                  a reasonably equivalent basis and (i) shall not be made
                  available to highly compensated employees (as defined in
                  Section 414(q) of the Code) in an amount greater than the
                  amount made available to other Participants, and (ii) shall
                  not be permitted for purchasing securities or in any way
                  financing a securities investment.

         (b)      The maximum amount of a loan to a Participant shall not exceed
                  the lesser of (i) 50% of the vested interest in his Account,
                  or (ii) $50,000, reduced by the highest outstanding loan
                  balance during the preceding twelve months. The minimum loan
                  amount is $1,000. Notwithstanding the foregoing, no amount of
                  a Participant's Account shall be considered available for a
                  loan if it is subject to a qualified domestic relations order
                  as such term is defined under Section 414(p)(1)(A) of the
                  Code.

         (c)      The Committee shall have complete discretion in determining
                  lien priorities among the various investments in the Account.
                  The Committee shall determine the interest rate for each loan,
                  consistent with the rate being charged by other lending
                  institutions for a similar loan to an unrelated borrower on
                  the same date. A loan shall be deemed to be an investment of a
                  Participant's individual Account and all interest payments and
                  repayments of principal shall be credited to the Account of
                  the Participant.

         (d)      The Participant shall be required to authorize payroll
                  deductions from his Compensation in an amount sufficient to
                  repay the loan over its term. Loan repayment amounts shall be
                  credited to a Participant's Account as of the date of payment
                  of the Compensation from which the repayment is taken. In the
                  event of default of the Participant before the loan is repaid
                  in full, the unpaid balance shall become due and payable and,
                  to the extent that the outstanding amount is not repaid within
                  60 days after demand for payment is


                                         31
<PAGE>   39
                  sent, such amount shall be deemed to have been distributed and
                  the Trustee shall first satisfy the indebtedness from the
                  amount payable to the Participant before making any payment to
                  the Participant. In the event of a Participant's death before
                  the loan is repaid in full, the Participant's estate shall be
                  the Beneficiary with respect to the outstanding loan
                  notwithstanding any other deemed or actual Beneficiary
                  designation and the unpaid loan balance shall be deemed to
                  have been distributed to the Participant's estate.

                  Upon a Participant's Termination of Employment, the
                  Participant can repay any outstanding loan balance in full or
                  continue to repay the outstanding balance in the same amount
                  and at the same rate as prior to the Termination of
                  Employment. Repayments after a Participant's Termination of
                  Employment shall be effected as determined by the Committee.

         (e)      During the repayment period for the loan, the Participant
                  shall be permitted to fully participate in the Plan.

         (f)      The Participant shall execute such other documents as the
                  Committee shall request.

         (g)      Only one loan for each Participant may be outstanding at one
                  time.

         (h)      The Committee may make additional rules for loans under the
                  Plan, provided that such rules are administered in a
                  nondiscriminatory manner.




                                       32
<PAGE>   40
                                    ARTICLE X

                           ADMINISTRATION OF THE PLAN

10.01 Nabisco Employee Benefits Committee.

      (a)   The general administration of the Plan and the responsibility for
            carrying out the provisions of the Plan shall be placed in the
            Committee, consisting of not less than three persons.

      (b)   Any member of the Committee may resign by delivering his written
            resignation to the Secretary of the Committee and such resignation
            shall become effective upon the date specified therein. A member
            shall be deemed to have resigned if he leaves the active employment
            of the Company and all Affiliated Companies.

      (c)   The Committee shall elect from its members a Chairman, and shall
            also elect a Secretary who may, but need not, be one of the members
            of the Committee. The Committee may appoint from its members such
            committees with such powers as it shall determine, and may authorize
            one or more of its members, or any agent, to execute or deliver any
            instrument or make any payment in its behalf.

      (d)   The Committee shall hold meetings upon such notice, at such place or
            places, and at such time or times as it may from time to time
            determine.

      (e)   A majority of the members of the Committee shall constitute a quorum
            for the transaction of business. All resolutions or other action
            taken by the Committee shall be by the vote of a majority of the
            members of the Committee present at any meeting or without a meeting
            by an instrument in writing signed by a majority of the members of
            the Committee.

      (f)   No member of the Committee shall receive any compensation for his
            service as such, and, except as may be required by applicable law,
            no bond or other security is required of him in such capacity in any
            jurisdiction.

10.02 Administrative Committee.

      (a)   The Committee, in its discretion, may delegate its administrative
            duties and responsibilities to one or more Administrative
            Committees each consisting of three or more persons, who shall be
            appointed by and serve at the


                                       33
<PAGE>   41
            pleasure of the Committee and one or more of whom may also be
            members of such Committee. Vacancies in the Administrative Committee
            shall be filled by the Committee but the Administrative Committee
            may act, notwithstanding any vacancies, so long as there are at
            least two members of such Committee. The members of an
            Administrative Committee shall serve without compensation for their
            services as such, but shall be reimbursed by the Company for all
            necessary expenses incurred in the discharge of their duties.

      (b)   Subject to restrictions imposed by the Committee, an Administrative
            Committee's powers shall include the following powers:

            (i)   to interpret Plan provisions with respect to eligibility,
                  service, vesting and determination of benefits,

            (ii)  to calculate benefits and authorize the payment of benefits by
                  the Plan trustees through disbursement accounts as directed by
                  the Administrative Committee,

            (iii) to authorize the payment of routine plan expenses exclusive of
                  trustee, investment manager, or actuary fees,

            (iv)  to prepare and/or approve the filing of required governmental
                  reports,

            (v)   to maintain Plan and Account records,

            (vi)  to prepare employee announcements, forms and procedures, and

            (vii) to review denials of benefit claims made by Participants or
                  Beneficiaries.

            The Administrative Committee, at its discretion, may delegate to
            assistants, including employees in the Company's Employee Benefits
            Department, ministerial and clerical duties.

10.03 Authority and Duties of Various Fiduciaries.


      (a)   The Committee (or the Administrative Committee acting on behalf
            of the Committee) shall have the exclusive right to interpret the
            Plan and to decide


                                       34
<PAGE>   42
            any and all matters arising under the Plan or in connection with its
            administration, including determination of and eligibility for the
            amount of distributions and withdrawals. The Company shall have no
            power to direct or modify any interpretations, determinations, or
            decisions of the Committee. The Committee may amend the Plan,
            subject to the provisions of Section 11.01. The Committee may adopt
            rules for the administration of the Plan and the conduct of its
            business and such rules shall be consistent with the provisions of
            the Plan.

      (b)   The Committee and any other named fiduciary may each employ counsel,
            agents, and such clerical and accounting services as it may require
            in carrying out its responsibilities under the Plan. All fiduciaries
            shall be entitled to rely upon tables, valuations, certificates,
            opinions, and reports furnished by any actuary, accountant, or legal
            counsel appointed under the provisions of the Plan.

      (c)   The Committee shall keep in convenient form such personnel data as
            may be necessary for the Plan. The Committee shall prepare,
            distribute, and file such reports and notices as may be required by
            applicable law or regulation.

      (d)   The members of the Committee shall use that degree of care,
            skill, prudence and diligence that a prudent man acting in a like
            capacity and familiar with such matters would use in his conduct
            of a similar situation. A member of the Committee shall not be
            liable for the breach of fiduciary responsibility of another
            fiduciary unless (i) he participates knowingly in, or knowingly
            undertakes to conceal, an act or omission of such other
            fiduciary, knowing such act or omission is a breach; or (ii) by
            his failure to discharge his duties solely in the interest of the
            Participants, Surviving Spouses and Beneficiaries for the
            exclusive purpose of providing their benefits and defraying
            reasonable expenses of administering the Plan not met by the
            Company, he has enabled such other fiduciary to commit a breach;
            or (iii) he has knowledge of a breach by such other fiduciary and
            does not make reasonable efforts to remedy the breach; or (iv)
            the Committee improperly allocates duties among its members or
            delegates duties to others and fails to properly review such
            allocation or delegation of fiduciary responsibilities.

      (e)   The Company will indemnify and hold harmless the members of the
            Committee and any person to whom fiduciary responsibilities are
            delegated under this Plan against any cost or expense (including
            attorney's fees) or liability (including any sum paid in settlement
            of a claim with the approval


                                       35
<PAGE>   43
            of the Company) arising out of any act or omission to act, except
            in the case of willful misconduct.

       (f)  Whenever, in the administration of the Plan, any discretionary
            action is required, the authorized party shall exercise his
            authority in a nondiscriminatory manner so that all persons
            similarly situated will receive substantially the same treatment.

10.04 Named Fiduciaries.

      (a)   The Committee and any Administrative Committee shall each constitute
            named fiduciaries as such term is defined in ERISA.

      (b)   Any fiduciary appointed as a named fiduciary by the Company by
            resolution or appointed by an appropriate instrument executed by an
            officer of the Company thereunto authorized shall also constitute a
            named fiduciary in respect of the duties delegated to him or it in
            such resolution or instrument.

10.05 Delegation. Any named fiduciary designated herein or appointed as provided
      herein, unless precluded from doing so by the terms of such appointment,
      may by appropriate instrument designate any person (including any firm or
      corporation) to carry out part or all of such fiduciary's responsibilities
      and upon such designation the named fiduciary shall have no liability,
      except as imposed by applicable law, for any act or omission of such
      person. The foregoing does not preclude any other fiduciary to the extent
      allowed by ERISA and the terms of his appointment from delegating part or
      all of such fiduciary's responsibilities with respect to the Plan.

10.06 Multiple Capacities.  Any fiduciary may serve in more than one
      fiduciary capacity with respect to the Plan.


                                       36
<PAGE>   44
                                   ARTICLE XI

              AMENDMENTS, TERMINATION, PERMANENT DISCONTINUANCE
                       OF CONTRIBUTIONS, MERGER OR CONSOLIDATION

11.01 Amendments. Subject to the provisions hereinafter set forth, the Company
      reserves the right at any time and from time to time by action of the
      Committee in writing, both retroactively and prospectively, to modify or
      amend, in whole or in part, any or all of the provisions of the Plan;
      provided, however, that (a) no such modification or amendment shall make
      it possible for any part of the funds of the Plan to be used for, or
      diverted to, purposes other than for the exclusive benefit of
      Participants, Surviving Spouses or Beneficiaries under the Plan; and (b)
      no modification or amendment shall be made which has the effect of
      decreasing retroactively the Accounts of any Participant or of reducing
      the nonforfeitable percentage of the Company Contribution Account of a
      Participant below the nonforfeitable percentage thereof computed under the
      Plan as in effect on the later of the date on which the amendment is
      adopted or becomes effective; and provided further, that any amendment of
      the Plan that involves a material increase in benefits for officers of the
      Company, a material increase in cost or a material change in design, other
      than technical amendments required by law or regulations, must be approved
      by the Board of Directors. No amendment shall eliminate or reduce an early
      retirement benefit or eliminate an optional form of benefit except as
      permitted by law.

11.02 Termination or Permanent Discontinuance of Contributions. The Company may
      by action of the Committee terminate the Plan with respect to all
      participating locations or any of them or direct complete discontinuance
      of contributions hereunder by all or any of the participating location for
      any reason at any time. In case of such termination or complete
      discontinuance of contributions hereunder, there shall automatically vest
      in the appropriate Participants nonforfeitable rights to the Company
      Contributions credited to their Accounts, and the total amount in each
      Participant's Accounts shall be distributed, as the Committee shall
      direct, to him or for his benefit.

11.03 Partial Termination. In the event of a partial termination of the Plan,
      the provisions of Section 11.02 shall be applicable only to the
      Participants affected by such partial termination.

11.04 Benefits in Case of Merger or Consolidation. The Plan may not be merged or
      consolidated with, nor may its assets or liabilities be transferred to,
      any other plan unless each Participant, spouse or Surviving Spouse, former
      Participant, retired


                                       37
<PAGE>   45
      Participant or Beneficiary under the Plan would, if the resulting plan
      were then terminated, receive a benefit immediately after the merger,
      consolidation, or transfer which is equal to or greater than the benefit
      he would have been entitled to receive immediately before the merger,
      consolidation, or transfer if the Plan had then terminated.


                                       38
<PAGE>   46
                                   ARTICLE XII

                                  MISCELLANEOUS

12.01 Benefits Payable from Trust Fund. All persons with any interest in the
      Trust Fund shall look solely to the Trust Fund for any payments with
      respect to such interest.

12.02 Elections. Elections for benefits or Beneficiaries hereunder shall be made
      by a Participant in the manner prescribed by the Committee for such
      purposes, within the prescribed time limits.

12.03 No Right to Continued Employment. Neither the establishment of the Plan
      nor the payment of any benefits thereunder nor any action of the Company,
      the Board of Directors, the Committee or the Trustee shall be held or
      construed to confer upon any person any legal right to be continued in the
      employ of the Company.

12.04 Inalienability of Benefits and Interests. No benefit payable under the
      Plan or interest in the Trust Fund shall be subject in any manner to
      anticipation, alienation, sale, transfer, assignment, pledge, encumbrance
      or charge, and any such attempted action shall be void and no such benefit
      or interest shall be in any manner liable for or subject to debts,
      contracts, liabilities, engagements or torts of any Participant, Surviving
      Spouse or Beneficiary.

12.05 Qualified Domestic Relations Orders.

      (a)   The provisions in Section 12.04 shall also apply to the creation,
            assignment or recognition of aright to any benefit payable with
            respect to a Participant pursuant to a domestic relations order,
            unless such order: (i) is determined to be a qualified domestic
            relations order, as defined in Section 414(p) of the Code, or (ii)
            was entered before January 1, 1985.

      (b)   If the Committee is in receipt of a domestic relations order, or
            the Committee is otherwise aware that a qualified domestic
            relations order affecting a Participant's account is being
            sought, the Committee may take such action as necessary
            (including, without limitation, restricting the participant's
            ability to withdraw or borrow funds in his or her Accounts) in
            order to administer the Plan consistently with the terms of any
            such qualified domestic relations order.

12.06 Payments for Exclusive Benefit of Participants. Payments of benefits in
      respect of the interest of a Participant  under the Plan to any person
      other than such Participant


                                       39
<PAGE>   47
      in accordance with the provisions of the Plan shall be deemed to be for
      the exclusive benefit of such Participant.

12.07 New Jersey Law to Govern. All questions pertaining to the construction,
      regulation, validity and effect of the provisions of the Plan shall be
      determined in accordance with the laws of the State of New Jersey, except
      to the extent such laws are pre-empted by ERISA.

12.08 No Guarantee.  Neither the Company nor the Trustee guarantee the Trust
      Fund in any manner against loss or depreciation.

12.09 Address of Record. Each individual or entity with an actual or potential
      interest in the Plan shall file and maintain a current record address with
      the Plan. Communications mailed by the Company, Trustee, or Committee to
      such record address fulfills all obligations to provide required
      information to Participants, including former employees, Surviving Spouses
      and Beneficiaries, in regard to the Plan. If no record address is filed,
      it may be presumed that the address used by the Company in forwarding
      statements of a Participant's Account is the record address.

12.10 Unlocated Spouse. Notwithstanding the consent requirement in Section 1.08,
      if the Participant establishes to the satisfaction of the Committee that
      such written consent cannot be obtained because there is no spouse or the
      spouse cannot be located, a waiver shall be deemed to be valid. Any
      consent necessary under Section 1.08 will be valid only with respect to
      the spouse who signs the consent, or in the event of a deemed election,
      the designated spouse.

12.11 Agent for Process.  The Secretary of Kraft Foods North America, Inc.
      shall be the designated agent for the service of legal process.

12.12 Payment in the Event of Incompetency. If the Committee finds that a
      Participant or other person entitled to a benefit is unable to care for
      his affairs because of illness or accident or is a minor, the Committee
      may direct that any benefit payment due the Participant, unless claim
      shall have been made therefor by a duly appointed legal representative, be
      paid to his spouse, a child, or a parent for the benefit of such
      Participant, and any such payment so made shall be a complete discharge of
      the liabilities of the Plan therefor.

12.13 Transfer of Accounts to This Plan.

      (a)   Affiliated Plans.  If a participant of a U.S. qualified
            Affiliated Plan becomes eligible to be a Participant of this Plan
            before receiving a distribution from


                                       40
<PAGE>   48
            the Affiliated Plan, his Account under the Affiliated Plan shall be
            transferred to this Plan by way of a trustee-to-trustee transfer.
            This Plan shall be considered as a successor plan with regard to
            such employee and all Affiliated Plan contributions transferred
            shall be treated as though they were made under this Plan for
            purposes of vesting, withdrawals and distributions. In the absence
            of an applicable Participant election, assets transferred from an
            Affiliated Plan shall be invested in the equivalent investment funds
            under this Plan or, if an equivalent investment fund does not exist,
            then the assets from the Affiliated Plan shall be invested in the
            Interest Income Fund; and the accounts of participants and
            beneficiaries under the Affiliated Plan will become their Accounts
            as Participants and Beneficiaries under this Plan, effective as of
            the transfer date. Once a Participant has received a distribution
            from the Affiliated Plan, it shall be treated as a Prior Plan for
            purposes of this Section 12.13.

      (b)   Prior Plans.  This Plan does not accept trustee-to-trustee
            transfers from a Prior Plan. However, the Trustee is authorized
            to accept as a Rollover Contribution any contribution that meets
            the following criteria:

            (i)   the contribution is made by, or on behalf of, an
                  Eligible Employee;

            (ii)  the contributed amounts were distributed from the Prior Plan
                  as an "eligible rollover distribution"(as defined in Section
                  7.06);

            (iii) the contribution is made either (a) as a direct rollover from
                  the Prior Plan to this Plan, or (b) by the Eligible Employee,
                  within 60 days after the date such distribution is received by
                  the Eligible Employee;

            (iv)  if applicable, the spousal consent requirements of
                  Code Section 417(x)(2) were complied with; and

            (v)   such Rollover Contribution meets any other conditions as
                  determined necessary by the Trustee or Committee to comply
                  with Code Section 408(d)(3).

            Rollover Contributions shall be held in the Eligible Employee's
            Rollover Contribution Account. The Eligible Employee is at all


                                       41
<PAGE>   49
            times fully vested with respect to his Rollover Contribution
            Account.

      (c)   RJR Plan.  In connection with the spin-off of RJR Nabisco, Inc.
            by RJR Nabisco Holdings Corp. effective as of June 14, 1999,
            certain individuals who were participating in the RJR Plan
            immediately prior to the spin-off, ceased to participate in the
            RJR Plan effective as of such date and, as of such date,
            commenced participation in this Plan (such individuals being
            hereinafter referred to as "Transferred Nabisco Employees". In
            connection with such commencement of participation in the Plan,
            this Plan shall accept a transfer of such Transferred Nabisco
            Employees' accounts (including any outstanding participant loans)
            under the RJR Plan in accordance with the provisions of ARTICLE
            XV. In addition, this Plan shall accept a transfer of the
            Accounts and any unused forfeiture amounts that are attributable
            to the Accounts of any individual who terminated employment with
            Nabisco, Inc. or an affiliate (other than an affiliate that is a
            participating company under the RJR Plan) prior to June 14, 1999,
            in accordance with the provisions of ARTICLE XV. If an individual
            who is a participant in the RJR Plan becomes an Employee after
            June 14, 1999 and elects to transfer amounts from the RJR Plan to
            this Plan, this Plan shall accept a transfer of such Employee's
            accounts (including any outstanding participant loans) under the
            RJR Plan in accordance with the provisions of ARTICLE XV.

      (d)   Certain 401(k) Plans.  With respect to an Eligible Employee who,
            pursuant to an Asset Purchase Agreement entered into on November
            19, 1999, has an accrued benefit from a qualified plan maintained
            by Favorite Brands International, Inc. transferred to the Nabisco
            Retirement Savings Plan (the "Savings Plan") or an accrued
            benefit from a qualified plan maintained by Trolli, Inc.
            transferred to the Nabisco Retirement Plan (the "Retirement
            Plan") and who becomes a Participant before receiving a
            distribution from the Savings Plan, as applicable, including any
            outstanding loan balances, shall be transferred to this Plan by
            way of a trustee-to-trustee transfer.

            With respect to an Eligible Employee  who previously was a
            participant in the Stella D'Oro Biscuit Co., Inc. Salary
            Reduction Plan (For Employees Who are Members of B.C. & T.C.W.
            Local 50) (the "Local 50 Plan") or the Stella D'Oro Biscuit Co.,
            Inc. Salary Reduction Plan for Employees of Local 550 (the "Local
            550 Plan") and who becomes a Participant before receiving a
            distribution from the Local 50 Plan, his account balance in the
            Local 50 Plan or the Local 550 Plan, as applicable, including any


                                       42
<PAGE>   50
            outstanding loan balances, shall be transferred to this Plan by way
            of a trustee-to-trustee transfer.

            All service credited under the Savings Plan, the Retirement Plan,
            the Local 50 Plan and the Local 550 Plan shall be taken into account
            for all purposes under the Plan. In the absence of an applicable
            Participant election, assets transferred from the Savings Plan, the
            Retirement Plan, the Local 50 Plan or the Local 550 Plan shall be
            invested in the equivalent investment funds under this Plan or, if
            an equivalent investment funds does not exist, then the assets from
            the Savings Plan, the Retirement Plan, the Local 50 Plan or the
            Local 550 Plan shall be invested in the Interest Income Fund. Once a
            Participant has received a distribution from the Savings Plan, the
            Retirement Plan, the Local 50 Plan or the Local 550 Plan, it shall
            be treated as a Prior Plan for purposes of this Section 12.13.

12.14 Transfer Of Accounts from this Plan to an Affiliated Plan. If a
      Participant transfers employment from the Company to an Affiliated Company
      and thereafter becomes eligible to participate in an Affiliated Plan, the
      assets in his Accounts in the Plan shall be transferred to such Affiliated
      Plan in accordance with the terms thereof.

12.15 Direct or Indirect Transfer. With respect to any Eligible Employee who is
      actively employed, the Plan shall accept any "eligible rollover
      distribution"(as defined in Section 7.06) from a defined benefit plan,
      money purchase pension plan (including a target benefit plan), stock bonus
      plan, or profit sharing plan or a conduit individual retirement account.

12.16 Payment of Expenses.

      (a)   Direct charges and expenses arising out of the purchase or sale of
            securities, and taxes levied on or measured by such transactions may
            be charged against the Account(s) or Investment Fund for which the
            transactions took place.

      (b)   Direct charges or expenses arising out of the establishment and
            maintenance of any funding account with an insurance company or
            other financial institution may be charged against the Account(s) or
            Investment Fund(s) for which the funding account is established.

      (c)   Investment Manager fees arising out of the establishment and
            maintenance of any investment Fund may be charged against the
            Investment Fund for which the Investment Manager fees are incurred.


                                       43
<PAGE>   51
      (d)   Trustee fees attributable to the Trust, auditor fees for the plan,
            and IRS user fees may be paid directly from the Trust. The Committee
            shall determine the manner in which these fees shall be charged
            against the Accounts or Investment Funds held in the Trust.

      (e)   Any other charges or expenses relating to the maintenance or
            administration of the Plan that are permitted under applicable law
            to be paid from the Trust including, but not limited to,
            recordkeeping fees, may be paid directly from the Trust. The
            Committee shall determine the manner in which these charges and
            expenses shall be charged against the Accounts or Investment Funds
            held in the Trust.

      (f)   Any of the expenses in (a)-(e) above may, at the option of the
            Company, be paid wholly or partly directly by the Company.

      (g)   The Company shall pay all other expenses reasonably incurred to
            administering the Plan.

      (h)   The Committee may authorize additional expenses to be charged
            directly from the Trust; provided that payment of such additional
            expenses from the Trust is permitted under applicable law, such fees
            are reasonable, and that any change in fee policy is communicated to
            Participants in a timely manner.

12.17 Transfer of Accounts to the R. J. Reynolds Tobacco Company Capital
      Investment Plan. The assets in the Accounts (including any outstanding
      Participant loans) of any individual who terminates employment with the
      Company or an Affiliated Company and commences employment with R. J.
      Reynolds Tobacco Company (or its affiliates) may (upon the election of
      such individual) be transferred to the corresponding accounts under the
      RJR Plan.

12.18 Headings. Headings of Articles and Sections of the Plan are inserted
      for convenience of reference. They constitute no part of the Plan.


                                       44
<PAGE>   52
                                  ARTICLE XIII

                                CLAIMS PROCEDURE

13.01 Initial Determination. The initial determination of a Participant's,
      Surviving Spouse's or Beneficiary's eligibility for, and the amount of, a
      benefit shall be made by the Administrative Committee, or in its absence,
      the Committee, which shall mail or deliver to each covered individual who
      has filed an effective claim for a benefit a written statement of the
      amount of his benefit or a notice of denial of his claim on or before the
      90th day following the Committee's receipt of such claim. If special
      circumstances require additional time for processing the claim, the
      Administrative Committee, or in its absence, the Committee, may delay
      issuing its statement or notice for an additional 90 days provided that
      the Participant, Surviving Spouse or Beneficiary is notified of the
      circumstances necessitating the delay and the date the Committee expects
      to render its final opinion. A claim for benefits is not effective unless
      filed in the manner prescribed by the Committee. Each notice of whole or
      partial denial of claimed benefits shall set forth the specific reasons
      for the denial, the time within which an appeal must be made by the
      Participant, Surviving Spouse or Beneficiary or his duly authorized
      representative, and shall contain such other information as may be
      required by applicable law. If a statement or notice is not issued within
      the prescribed period, the claim shall be deemed denied.

13.02 Review. Each Participant, Surviving Spouse or Beneficiary whose claim for
      benefits has been wholly or partially denied shall have such rights to
      review documents and submit comments as applicable law and regulations of
      the Committee may provide, and shall also have the right to request the
      Committee to review such denial; such request to be made on forms
      prescribed by the Committee. A request for review shall be filed by the
      Participant, Surviving Spouse or Beneficiary or his duly authorized
      representative on or before the 60th day following the earlier of the
      Participant's, Surviving Spouse's or Beneficiary's receipt of notice of
      denial of his claim or the expiration of the prescribed period for issuing
      a statement of benefits or notice of denial. The Committee shall issue a
      written statement on or before the 60th day following its receipt of such
      request stating the Committee's decision on review and the reasons
      therefore, including specific references to pertinent Plan provisions on
      which the decision is based, and any other information required by
      applicable law. If special circumstances require additional time for
      processing such review, the Committee may delay issuing its decision for
      an additional 60 days provided that the Participant, Surviving Spouse or
      Beneficiary is notified of such circumstances and the date the Committee



                                       45
<PAGE>   53
      expects to render its final decision. If the decision is not issued within
      the prescribed period, the appeal shall be deemed denied.

                                      46
<PAGE>   54

                                   ARTICLE XIV

                             LIMITATION ON BENEFITS

14.01 Code Section 415 Limits.

      (a)   The following definitions shall be applied in construing this
            Section.

            (1)   Defined Benefit Plan means any defined benefit plan (as
                  defined in Section 415(k) of the Code) maintained by any
                  Affiliated Company.

            (2)   Related Plan means any Defined Contribution Plan (as defined
                  in Section 415(k) of the Code), other than the Plan,
                  maintained by any Affiliated Company or any individual account
                  maintained for voluntary contributions made by a Participant
                  under a Defined Benefit Plan.

            (3)   Total Compensation means all remuneration paid to an Employee
                  by any Affiliated Company, as determined pursuant to the
                  provisions of Treasury Regulation Section 1.415-2(d)(11)(i).

            (4)   Annual Addition means the sum of the following amounts
                  credited to a Participant's account for the limitation year:

                  (A)   employer contributions;

                  (B)   employee contributions;

                  (C)   forfeitures; and

                  (D)   amounts allocated to an individual medical account, as
                        defined in Section 415(1)(2) of the Code, which is part
                        of a pension or annuity plan maintained by the employer
                        and amounts derived from contributions paid or accrued
                        after December 31, 1985, in taxable years ending after
                        such date, which are attributable to post-retirement
                        medical benefits allocated to the separate account of a
                        key employee, as defined in Section 419A(d)(3) of the
                        Code, under a welfare


                                       47
<PAGE>   55
                        benefit fund, as defined in Section 419(e) of the Code,
                        maintained by the employer.

      (b)   Limitations Applicable to Participants in Defined Contribution
            Plans Only

            (i)   The Annual Addition credited to a Participant under the Plan
                  or any Related Plan for any Limitation Year must not exceed
                  the lesser of (1) $30,000 (or, if greater, 25% of the defined
                  benefit dollar limitation set forth in Section 415(b)(1) of
                  the Code as in effect for the Plan Year) or (2) 25% of the
                  Participant's Total Compensation for such Limitation Year.

            (ii)  Excess Annual Additions. If the amount of Annual Additions
                  which are credited to a Participant under this Plan for any
                  Limitation Year exceeds the maximum amount permitted under
                  this Section ("Excess Annual Additions", and if such excess
                  was caused by the allocation of forfeitures, a reasonable
                  error in estimating a Participant's annual compensation, a
                  reasonable error in determining the amount of Basic
                  Contributions and Supplemental Pre-Tax Contributions that may
                  be made with respect to the Participant under the limitations
                  of this Section, or other limited facts and circumstances
                  which the Commissioner of Internal Revenue finds justified,
                  the Excess Annual Additions may be reduced for such Limitation
                  Year in the following manner:

                  (A)   Supplemental After-Tax Contributions (and any income
                        attributable thereto ) made by the Participant shall be
                        distributed to the Participant to the extent such
                        distributions reduce the Excess Annual Additions. Any
                        Supplemental After-Tax Contributions that are so
                        distributed shall not be considered as an Annual
                        Addition for the Limitation Year and shall be
                        disregarded for purposes of Section 3.08.

                  (B)   If there remains any Excess Annual Additions after the
                        application of subparagraph (i) of this paragraph,
                        Supplemental Pre-Tax Contributions (and any income
                        attributable thereto) made by the Participant shall be
                        distributed to the Participant to the extent that such
                        distributions reduce the Excess Annual


                                       48
<PAGE>   56
                        Additions. Any Supplemental Pre-Tax Contributions
                        that are so distributed shall not be considered as an
                        Annual Addition for the Limitation Year and shall be
                        disregarded for purposes of Sections 3.07 and 3.08.

                  (C)   If there remains any Excess Annual Additions after the
                        application of subparagraphs (i) and (ii) of this
                        paragraph, Basic Contributions (and any income
                        attributable thereto) made by the Participant shall be
                        distributed to the Participant to the extent that such
                        distributions reduce the Excess Annual Additions. Any
                        Basic Contributions that are so distributed shall not be
                        considered as an Annual Addition for the Limitation Year
                        and shall be disregarded for purposes of Sections 3.07
                        and 3.08.

                  (D)   If there remains any Excess Annual Additions after the
                        application of subparagraphs (i), and (ii) and (iii) of
                        this paragraph, such Excess Annual Additions shall be
                        used to reduce Company Contributions for the next
                        Limitation Year (and succeeding Limitation Years, as
                        necessary) for the Participant. However, if the
                        Participant is not participating in the Plan for the
                        applicable Limitation Year, the Excess Annual Additions
                        shall be held in a suspense account for that Limitation
                        Year and allocated in the next Limitation Year to all
                        remaining Participants in the same proportion as the
                        Compensation paid to such Participants during such
                        Limitation Year. Furthermore, the Excess Annual
                        Additions shall be used to reduce Company Contributions
                        for the next Limitation Year (and succeeding Limitation
                        Years, as necessary) for all of such Participants. Any
                        Excess Annual Additions that are treated in accordance
                        with this subparagraph (iv) for the Limitation Year
                        shall not be considered as Annual Additions for such
                        Limitation Year.

                  (E)   If the suspense account is in existence at any time
                        during the Limitation Year in accordance with this
                        Section, investment gains and losses and other


                                       49
<PAGE>   57
                        income and expenses shall not be allocated to the
                        suspense account.

                  (F)   If this Plan is terminated and at the time of such
                        termination a balance remains in the suspense account
                        which, because of the limitations imposed by this
                        Section, cannot be credited to any Participant, such
                        balance shall revert to the Company.

      (c)   Adjustments on Account of Excess Credits. If it is determined at any
            time that the Defined Contribution Fraction and the Defined Benefit
            Fraction exceed 1.0, the maximum benefit under any applicable
            Defined Benefit Plan will be adjusted to the extent necessary to
            satisfy the combined fraction limitation.

      (d)   In addition to other limitations set forth in the Plan and
            notwithstanding any other provisions of the Plan, contributions (and
            contributions to all other Defined Contribution Plans required to be
            aggregated under this Plan under the provisions of Section 415 of
            the Code), shall not be made in an amount in excess of the amount
            permitted under Section 415 of the Code.

14.02 Code Section 416 Limits. This Section is intended to ensure the Plan's
      compliance with Section 416 of the Code. It shall be applicable to
      Participants for any Plan Year with respect to which the Plan is
      top-heavy.

      (a)   Definitions.  The following definitions shall be applied in
            construing this Section.

            (i)   Top-Heavy Plan means any plan maintained by the Company or
                  an Affiliated Company if, as of the Determination Date, the
                  Top-Heavy Ratio for the plan and all other plans in the
                  Aggregation Group exceeds 60%. The plan will be deemed a
                  "super top-heavy plan" if, as of the Determination Date,
                  the Plan would meet the test specified above for being a
                  Top-Heavy Plan if 90% were substituted for 60% in each
                  place it appears in this subsection(i).

            (ii)  Determination Date means the last day of the preceding Plan
                  Year (or, in the case of the first plan year of a plan, the
                  last day of such Plan Year). When plan aggregation is
                  required, calculation of accrued benefits as of the
                  Determination Date which fall within the same calendar year
                  will be used.


                                       50
<PAGE>   58
            (iii) Valuation Date means the same date as the Determination
                  Date.

            (iv)  Key Employee means each Employee or former Employee who is, at
                  any time during the Plan Year ending on the Determination
                  Date, or was, during any one of the four Plan Years preceding
                  the Plan Year ending on the Determination Date, any one or
                  more of the following:

                  (1)   An officer of the Company or an Affiliated Company
                        having an annual compensation greater than 50% of the
                        dollar limitation in effect under Code Section
                        415(b)(I)(A) for any Plan Year;

                  (2)   One of 10 Employees having annual compensation from the
                        Company or an Affiliated Company of more than the dollar
                        limitation in effect under Code Section 415(c)(1)(A) and
                        owning (or considered as owning within the meaning of
                        Code Section 318) both the largest interests in the
                        Company or an Affiliated Company and a 1/2% ownership
                        interest;

                  (3)   Any person owning (or considered as owning within the
                        meaning of Code Section 318) more than 5% of the
                        outstanding stock of the Company (or stock having more
                        than 5% of the total combined voting power of all stock
                        of the Company); or

                  (4)   Any person who has annual compensation of more than
                        $150,000 and would be described in subsection (3) above,
                        if "1%" was substituted for "5%"

                  For purposes of determining whether a person is an officer in
                  subsection (1) above, in no event will more than 50 Employees
                  be considered Key Employees solely by reason of officer
                  status. In addition, persons who are merely nominal officers
                  will not be treated as Key Employees solely by reason of their
                  titles as officers. For purposes hereof, compensation is as
                  defined in Section 1.415-2(d) of the Income Tax Regulations.


                                       51
<PAGE>   59
            (v)   Non-Key Employee means any Participant in the Plan (including
                  a beneficiary of such Participant) who is not a Key Employee.

            (vi)  Aggregation Group means all plans that are subject to Required
                  Aggregation (in accordance with subsection 14.02(b)). The
                  Aggregation Group may also include plans subject to Permissive
                  Aggregation (in accordance with subsection 14.02(c)), if such
                  aggregation would eliminate the status of plans in the
                  Aggregation Group as Top-Heavy Plans.

      (b)   Required Aggregation.  This Plan and all other qualified plans,
            including any terminated plans, maintained by the Company or an
            Affiliated Company which include a Key Employee must be
            aggregated to determine if the group as a whole is top-heavy. In
            addition, each other qualified plan maintained by the Company or
            an Affiliated Company which enables any plan in which a Key
            Employee is a Participant to meet the requirements of Sections
            410(a)(4) and 410 of the Code must be aggregated.

      (c)   Permissive Aggregation. The Company may include other plans
            maintained by the Company or an Affiliated Company which when
            considered as a group with the required aggregation group, would
            continue to satisfy the requirements of Sections 401(a)(4) and 410
            of the Code, to determine if the group as a whole is top-heavy,
            provided such plans are comparable in benefits or contributions.

      (d)   Top-Heavy Ratio.

            (i)   The top-heavy ratio is a fraction, the numerator of which
                  is the sum of account balances under the defined
                  contribution plans in the Aggregation Group for all Key
                  Employees and the present value of accrued benefits under
                  the defined benefit plans for all Key Employees, and the
                  denominator of which is the sum of the account balances
                  under the defined contribution plans in the Aggregation
                  Group for all Participants and the present value of accrued
                  benefits under the defined benefit plans in the Aggregation
                  Group for all Participants. Both the numerator and
                  denominator are adjusted to include any distributions made
                  in the five-year period ending on the "Determination Date"
                  and any contributions due but unpaid as of the
                  Determination Date.


                                       52
<PAGE>   60
            (ii)  The value of account balances and the present value of accrued
                  benefits will be determined as of the most recent Valuation
                  Date. The account balances and accrued benefits of a
                  Participant who is not a Key Employee but who was a Key
                  Employee in a prior year will be disregarded. The calculation
                  of the top-heavy ratio, and the extent to which distributions,
                  rollovers and transfers are taken into account will be made in
                  accordance with Section 416 of the Code and the regulations
                  thereunder.

            (iii) If any Participant has not performed an Hour of Service for
                  the Company at any time during the five-year period ending on
                  the Determination Date, the account of such Participant shall
                  not be taken into account.

      (e)   Minimum Vesting. For any Plan Year in which the Plan is a top-heavy
            plan as determined pursuant to Section 416 of the Code, a
            Participant will have a nonforfeitable right to a percentage of the
            Participant's Accounts derived from Company Contributions as set
            forth below if such schedule is more favorable to the Participant
            than the vesting schedule under Section 7.02.

<TABLE>
<CAPTION>
            Years of Service Completed
            For Vesting Purposes                      Vested Interest
            --------------------                      ---------------

<S>                                                   <C>
            Less than two                                     0%
            Two but less than three                          20%
            Three but less than four                         40%
            Four but less than five                          60%
            Five or more                                    100%
</TABLE>

            The above vesting schedule applies to all benefits the meaning of
            Section 411(a)(7) of the Code, including benefits accrued before the
            effective date of Section 416 of the Code and benefits accrued
            before the Plan became top-heavy. However, any Participants who have
            completed at least three (3) years of service for vesting purposes
            as of the last day of the last Plan Year (a) before the Plan became
            top-heavy or (b) in which the Plan is top-heavy, shall have the
            right to elect to continue to have the vesting schedule in effect on
            the last day of such Plan Year applied to all of his benefits under
            the Plan. Further, no reduction in vested benefits may occur in the
            event the Plan's status as top-heavy changes for any Plan Year.


                                       53
<PAGE>   61
      (f)   Minimum Required Contribution.  It is intended that the Company or
            an Affiliated Company will meet the minimum contribution
            requirements of Section 416(c) of the Code by providing a minimum
            contribution (which may include forfeitures otherwise allocable)
            without regard to any Social Security contributions for such Plan
            Year for each Participant who is a non-key employee in an amount
            equal to at least 3% of such Participant's compensation (as defined
            in Section 1.415-2(d) of the Income Tax Regulations) for such Plan
            Year, Such 3% minimum contribution requirement shall be increased to
            4% for any year in which the Company or an Affiliated Company also
            maintains a defined benefit pension plan if necessary to avoid the
            application of Section 416(h)(1) of the Code, relating to the
            special adjustments to Section 415 limits of the Code for top-heavy
            plans, if the adjusted limitations of Section 416(h)(1) would
            otherwise be exceeded if such minimum contribution were not so
            increased. The minimum contribution required shall be made to any
            non-key employee who is still employed on the last day of the plan
            year regardless as to the number of hours of Service performed
            during the year and regardless of the employee's level of
            compensation.

            A Non-Key Employee who is also covered under a defined benefit plan
            that is part of the same Aggregation Group shall receive his minimum
            benefit under the defined benefit plan, offset by the actuarially
            determined value of the minimum contribution made under this Plan.

            If for the Plan Year the Plan becomes a super top-heavy plan, then
            the denominator of both the defined contribution plan fraction and
            the defined benefit plan fraction shall be calculated as set forth
            in Section 14.01 (b) for the limitation year ending in such Plan
            Year by substituting "1.0" for "1.25" in each place such figure
            appears.

            The percentage minimum contribution required hereunder shall in no
            event exceed the percentage contribution made for the Key Employee
            for whom such percentage is the highest for the Plan Year after
            taking into account contributions or benefits under other qualified
            plans in this Plan's aggregation group providing no other defined
            benefit plan uses the defined contribution plan to satisfy Code
            Section 401 (a) as provided in Section 416(c)(2)(B)(ii) of the Code.


                                       54
<PAGE>   62
                                   ARTICLE XV

                  SPECIAL PROVISIONS PERTAINING TO TRANSFERS
                 FROM THE RJR NABISCO CAPITAL INVESTMENT PLAN

      Amounts transferred from accounts of the RJR Plan shall be accounted for
in accordance with the following rules:

15.01 Amounts transferred from the RJR Plan to this Plan consisting of
      Participant's "Basic Contribution Account" (as such term was defined in
      the RJR Plan) attributable to elective deferrals made pursuant to Section
      401 (k) of the Code and any earnings attributable to such elective
      deferrals, shall be credited to such Participant's Basic Contribution
      Account under this Plan.

15.02 Amounts transferred from the RJR Plan to this Plan consisting of
      Participant's "Supplemental Pre-Tax Contribution Account" (as such term
      was defined in the RJR Plan) attributable to elective deferrals made
      pursuant to Section 401 (k) of the Code and any earnings attributable to
      such elective deferrals, shall be credited to such Participant's
      Supplemental Pre-Tax Contribution Account under this Plan.

15.03 Amounts transferred from the RJR Plan to this Plan consisting of a
      Participant's "Supplemental After-Tax Contribution Account"(as such term
      was defined in the RJR Plan), shall be credited to such Participant's
      Supplemental After-Tax Contribution Account under this Plan.

15.04 Amounts transferred from the RJR Plan consisting of a Participant's
      "Company Contribution Account" as such term was defined in the RJR Plan)
      attributable to "matching contributions" (as defined under Code Section
      401(m)(4)(A)) and any earnings attributable to such matching
      contributions, shall be credited to such Participant's Company
      Contribution Account under this Plan.

15.05 Amounts transferred from the RJR Plan consisting of a Participant's
      "Rollover Account" (as such term was defined in the RJR Plan), shall be
      credited to such Participant's Rollover Account under this Plan.

15.06 Amounts transferred from the RJR Plan consisting of a Participant's
      "After-Tax Basic Contribution Account" (as such term was defined in the
      RJR Plan), shall be credited to such Participant's After-Tax Basic
      Contribution Account under this Plan.


                                       55
<PAGE>   63
15.07 All applicable "benefit options" (within the meaning of Section
      411(d)(6)(B)(ii) of the Code and the Treasury Regulations thereunder) that
      are attributable to any amounts transferred from the RJR Plan shall
      continue to apply with respect to such transferred amounts held under this
      Plan.

15.08 Any outstanding loan transferred to the Plan from the RJR Plan will
      continue to be held on the same terms as those contained in the loan
      agreement between the Participant and the RJR Plan, except that the Plan
      will be substituted as the obligee of the loan.

15.09 Any unused forfeiture amounts that are attributable to the account of any
      individual who terminated employment with the Company prior to June 14,
      1999 shall be transferred to this Plan and held as unused forfeitures
      under this Plan.

15.10 The provisions of Section 6.05, relating to the restoration of
      forfeitures, shall apply to any individual who: (i) was a participant in
      the RJR Plan, (ii) terminated employment with the Company prior to June
      14, 1999, (iii) received a distribution of his vested interest under the
      RJR Plan, (iv) was re-employed by the Company or any Affiliated Company on
      or after June 14, 1999 prior to completing five (5) consecutive Breaks in
      Service (including, for this purpose, any breaks in service that might
      have occurred under the RJR Plan), and (v) repays the full amount
      previously distributed to him within five (5) years of the date he is
      re-employed by the Company or any Affiliated Company.

15.11 All applicable "benefit options" (within the meaning of Section
      411(d)(6)(B)(ii) of the Code and the Treasury Regulations thereunder)
      that are attributable to amounts transferred from the Stella D'Oro
      Biscuit Co., Inc. 401 (k) Profit Sharing Plan, the Stella D'Oro Biscuit
      Co., Inc. Profit Sharing Plan, the Cornnuts, Inc. Profit Sharing and
      Retirement Plan or any other qualified plan from which amounts were
      transferred to the RJR Plan and subsequently transferred to this Plan
      pursuant to this ARTICLE XV, shall continue to apply with respect to
      such transferred amounts held under this Plan.


                                       56
<PAGE>   64
                               CIP -- COMPENSATION

                            SCHEDULE A - COMPENSATION

I.    The following payments are included as Compensation for all
      Participants:

      -   Basic Salary

      -   Overtime

      -   Shift Premium Pay

      -   Commissions

      -   Sales incentive payments paid in cash

      -   Vacation Pay (except as noted in II)

      -   Management Incentive Plan bonus or any similar management bonus if (i)
          payment is made on a non-deferred basis and (ii), the total aggregate
          amount of such bonuses do not exceed the regular AIAP award for the
          plan year and/or the maximum award payable under the AIAP.

      -   Compensation deferred pursuant to salary reduction arrangement under
          Code Sections 401 (k), 125 or, effective as of December 31, 2001,
          132(f)(4) to which the Company makes contributions.

      -   Lump Sum payments in lieu of an increase in basic salary.

      -   Payments under the Kraft Incentive Plan

      -   Amounts paid under the Field Operation Incentive Plan

      -   Cash denominated awards under the LTIP which are granted in lieu of
          regular AIAP awards or on a contractually required annual basis.

      -   Salary continuation payments paid in semi-monthly installments

      -   All U.S. based payroll amounts whether or not the employee is U.S.
          based.


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<PAGE>   65
II.   The following payments are not included as Compensation for
      Participants:

      Any form of compensation not listed in Part I, and specifically excluding
      the following:

      -   Vacation Pay taken in lieu of vacation

      -   Moving expenses

      -   Housing differential

      -   Bonus or other award payment which have been previously deferred

      -   Change of control bonus

      -   Stay-on/completion bonus

      -   Special incentive or bonus payments paid on an irregular or one-time
          basis unless designated for inclusion by the CEO

      -   Commendation Awards, Contest Awards or any other bonus paid on an
          irregular or one time basis (Nabisco, Inc.)

      -   Company contributions under any employee benefit plan (except
          contributions on account of employee elections to defer salary under
          Code Sections 401(k), 125 or, effective as of December 31, 2001,
          132(f)(4).

      -   Amounts deferred pursuant to the Nabisco Scholastic Savings Plan.


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