Document:

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                                                                     EXHIBIT 4.8

             KIMBERLY-CLARK CORPORATION RETIREMENT CONTRIBUTION PLAN

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                           KIMBERLY-CLARK CORPORATION
                          RETIREMENT CONTRIBUTION PLAN

                       (Amended through December 21, 2000)

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                                                                          RC-021

             KIMBERLY-CLARK CORPORATION RETIREMENT CONTRIBUTION PLAN

                                TABLE OF CONTENTS

<TABLE>
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Article I         Name, Purpose and Effective Date of Plan

Article II        Definitions and Construction
                  2.1      Definitions
                  2.2      Construction

Article III       Participation
                  3.1      Effective Date of Participation
                  3.2      Transfer To and From Participating Units
                  3.3      Nonduplication of Accruals for Participation in Other Plans

Article IV        Retirement Contributions
                  4.1      Retirement Contributions
                  4.2      Limited Service and Leave of Absence
                  4.3      Amount of Retirement Contribution
                  4.4      Contributions by Participants
                  4.5      Temporary Suspension of Retirement Contributions
                  4.6      Allocations to Retirement Accounts
                  4.7      Valuation
                  4.8      Payment of Contributions to Trustee
                  4.9      Deductibility Requirement
                  4.10     Mistaken Contributions
                  4.11     General Limitation

Article V         Limitations on Benefits
                  5.1      Limitations on Benefits
                  5.2      Aggregation of Plans

Article VI        Trustee, Trust Agreement and Plan Expenses
                  6.1      Trust Agreement
                  6.2      Establishment of Investment Funds
                  6.3      Fund Investments
                  6.4      Reinvestment of Income
                  6.5      Plan Expenses

Article VII       Investment Directions
                  7.1      Investment of Contributions
                  7.2      Investment Election
                  7.3      Reallocations
                  7.4      Fund Transfers
                  7.5      Effective Date of Investment Changes
                  7.7      Voting of Corporation Stock
                  7.8      Tender Offers
                  7.9      Stock Rights, Stock Splits and Stock Dividends
</TABLE>

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<TABLE>
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Article VIII      Vesting
                  8.1      Five Years of Service
                  8.2      Other Vesting Events
                  8.3      Forfeitures and Restorations
                  8.4      Coosa Benefit
                  8.5      K-C Aviation Benefit
                  8.6      Southeast Timberlands Benefit
                  8.7      Mobile Pulp Mill Benefit
                  8.8      Durafab-Cleburne Benefit

Article IX        Distributions and Withdrawals
                  9.1      Optional Forms of Distribution
                  9.2      Lump Sum and Partial Distributions
                  9.3      Distribution by Reason of Death
                  9.4      Distribution Upon Termination of Employment for Reasons other than Death
                  9.5      Small Distributions
                  9.6      Consent Required
                  9.7      Evidence of Right to Receive Benefit
                  9.8      Required Distributions
                  9.9      Direct Rollovers
                  9.10     Withdrawals
                  9.11     Unclaimed Benefits

Article X         Incentive Investment Plan Committee
                  10.1     Membership
                  10.2     Powers
                  10.3     Procedures
                  10.4     Rules and Decisions
                  10.5     Authorization of Payments
                  10.6     Books and Records
                  10.7     Perpetuation of the Committee
                  10.8     Claims Procedure
                  10.9     Allocation or Reallocation of Fiduciary Responsibilities
                  10.10    Plan Administrator
                  10.11    Service of Process

Article XI        Amendment and Termination
                  11.1     Amendment and Termination

Article XII       Miscellaneous
                  12.1     Non-Guarantee of Employment
                  12.2     Rights to Trust Assets
                  12.3     Disclaimer of Liability
                  12.4     Non-Recommendation of Investment
                  12.5     Indemnification of Committee
                  12.6     Non-Alienation
                  12.7     Facility of Payment
                  12.8     Action by a Committee of the Board
                  12.9     Qualified Domestic Relations Orders
                  12.10    Compensation Limit

Article XIII      Merger

Article XIV       Top-Heavy Requirements

Appendix A        List of Employers, Participating Units and Effective Dates of Participation
</TABLE>

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                                    ARTICLE I

                    NAME, PURPOSE AND EFFECTIVE DATE OF PLAN

This Kimberly-Clark Corporation Retirement Contribution Plan (the "Plan") has
been adopted effective January 1, 1997. Its purpose is to supplement in part the
retirement income which eligible Employees may be entitled to receive under the
Federal Social Security Act and to encourage Eligible Employees to arrange for
personal investment programs. The Plan is intended to meet the requirements of
Section 401(a) of the Internal Revenue Code of 1986, as amended, and the
Employee Retirement Income Security Act of 1974, as amended. The Plan is
intended to qualify as a profit-sharing plan.

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                                   ARTICLE II

                          DEFINITIONS AND CONSTRUCTION

2.1      Definitions. When the following words and phrases appear in this Plan,
         they shall have the respective meanings set forth below unless the
         context clearly indicates otherwise:

         (a)      Affiliated Employer: An Employer and any corporation which is
                  a member of a controlled group of corporations (as defined in
                  Code section 414(b)) which includes an Employer; any trade or
                  business (whether or not incorporated) which is under common
                  control (as defined in Code section 414(c)) with an Employer;
                  any organization (whether or not incorporated) which is a
                  member of an affiliated service group (as defined in Code
                  section 414(m)) which includes an Employer; and any other
                  entity required to be aggregated with an Employer pursuant to
                  Code section 414(o).

         (b)      Base Earnings: A Participant's Earnings up to an amount which
                  does not exceed two-thirds (2/3) of the Taxable Wage Base for
                  the Plan Year.

         (c)      Beneficiary: The person or persons last designated on Timely
                  Notice by a Participant, provided the named person survives
                  the Participant. If no such person is validly designated or if
                  the designated person predeceases the Participant, the
                  Beneficiary shall be the Participant's spouse, if living, and
                  if not, the Participant's estate.

         (d)      Board: The Board of Directors of the Corporation.

         (e)      Business Day: Any day on which securities are traded on the
                  New York Stock Exchange.

         (f)      Code: The Internal Revenue Code of 1986, as amended from time
                  to time.

         (g)      Committee: The committee designated to administer and regulate
                  the Plan as provided in Article X.

         (h)      Corporation: Kimberly-Clark Corporation (a Delaware
                  corporation).

         (i)      Corporation Stock: The common stock of the Corporation.

         (j)      Current Market Value: The fair market value on any day as
                  determined by the Trustee in accordance with generally
                  accepted valuation principles applied on a consistent basis.

         (k)      Day of Service: An Employee shall be credited with a Day of
                  Service for each calendar day commencing with the date on
                  which the Employee first performs an Hour of Service until the
                  Employee's Severance from Service Date. If an Employee quits,
                  is discharged, retires, or dies, and such Employee does not
                  incur a One-Year Period of Severance, the Employee shall be
                  credited with a Day of Service for each calendar day elapsed
                  from the Employee's Severance from Service Date to the date on
                  which the Employee again completes an Hour of Service.

         (l)      Earnings: Remuneration when paid, or would have been paid but
                  for a Participant's deferral election, to a Participant by an
                  Employer for personal services rendered to the Employer
                  (before any withholding required by law or authorized by the
                  person to whom such remuneration is payable), including
                  overtime, bonuses, incentive compensation, vacation pay,
                  deducted military pay, state disability payments received,
                  workers compensation payments received, and to the extent such
                  deductions decrease the individual's base pay, Before-Tax
                  deferrals under the Kimberly-Clark Corporation Salaried
                  Employees Incentive Investment Plan or Kimberly-Clark
                  Corporation Hourly Employees Incentive Investment Plan, or any
                  other plan maintained by an Employer and described under
                  Section 401(k) of the Code, contributions under the
                  Kimberly-Clark Corporation Flexible Benefits Plan or any other
                  plan maintained by an Employer and described under Section 125
                  of the Code, but excluding any severance payments (except as
                  provided in Section 4.3), payments made under the
                  Kimberly-Clark Equity Participation Plans, pay in lieu of
                  vacation, deferrals under the Kimberly-Clark Corporation
                  Deferred Compensation Plan, compensation paid in a form other
                  than cash (such as goods, services and, except as otherwise
                  provided herein, contributions to

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                  employee benefit programs), service or suggestion awards, and
                  all other special or unusual compensation of any kind.

                  Earnings paid to an Employee for a Plan Year in excess of
                  $150,000 (as adjusted at the same time and in the same manner
                  as under section 415(d) of the Code for that Plan Year) shall
                  not be taken into account.

                  Notwithstanding the above, in the case of an Employee on
                  foreign assignment, as determined by the Employer pursuant to
                  Committee rule, Earnings shall be base salary, as determined
                  by the Employer pursuant to Committee rule, which includes
                  401(k) deferrals under the Kimberly-Clark Corporation Salaried
                  Employees Incentive Investment Plan or any other plan
                  maintained by an Employer and described under Section 401(k)
                  of the Code, and contributions under the Kimberly-Clark
                  Corporation Flexible Benefits Plan or any other plan
                  maintained by an Employer and described under Section 125 of
                  the Code, plus overtime, bonuses, incentive compensation and
                  vacation pay, but shall exclude foreign service premiums, cost
                  of living adjustments, housing payments, tax equalization
                  payments, severance payments (except as provided in Section
                  4.3), compensation in a form other than cash (such as goods,
                  services and, except as otherwise provided herein,
                  contributions to employee benefit programs), service or
                  suggestion awards and all other special or unusual
                  compensation of any kind.

         (m)      Eligible Employee: Any person who is in the employ of an
                  Employer during such periods as he meets all of the following
                  conditions:

                  (i)      he is an Employee on the regular payroll of an
                           Employer, and

                  (ii)     he is in a Participating Unit.

                  For purposes of this subsection, "on the regular payroll of an
                  Employer" shall mean paid through the payroll department of
                  such Employer, and shall exclude employees classified by an
                  Employer as intermittent or temporary, and persons classified
                  by an Employer as independent contractors, regardless of how
                  such Employees may be classified by any federal, state, or
                  local, domestic or foreign, governmental agency or
                  instrumentality thereof, or court.

                  Any leased employee (as defined in Code section 414(n)) shall
                  not be considered an Eligible Employee under the Plan. In
                  addition, a person who formerly was an Eligible Employee shall
                  be treated as an Eligible Employee for all purposes hereunder
                  during such periods as he meets all of the following
                  conditions:

                  (i)      he is an Employee on the regular payroll of an
                           Employer, and

                  (ii)     he is on temporary assignment to provide services for
                           a corporation, hereinafter referred to as the
                           "Affiliate," which is a member of a controlled group
                           of corporations, within the meaning of Code section
                           414(b) as modified by Code section 415(h), of which
                           the Corporation is a member, and which is not an
                           Employer hereunder.

                  For purposes of the preceding sentence, a person shall be
                  considered on temporary assignment only if his period of
                  service for an Affiliate is expected to be of brief duration
                  not to exceed 2 years and if he is expected to resume services
                  for an Employer upon the expiration of the temporary
                  assignment with the Affiliate. A person shall also be
                  considered on temporary assignment at other Employers or in
                  other classifications or from another Employer or
                  classification only if his period of service in such
                  assignment is expected to be of brief duration not to exceed 2
                  years and if he is expected to resume services in his regular
                  assignment upon the expiration of such assignment.

         (n)      Employee: A person employed by an Employer.

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         (o)      Employer: The Corporation and each Subsidiary which the
                  Committee shall from time to time designate as an Employer for
                  purposes of the Plan and which shall adopt the Plan and the
                  Trust. A list of Employers is set forth in Appendix A.

         (p)      Equity Company: Any corporation, which is not the Corporation
                  or a Subsidiary, 33-1/3% or more of the voting shares of which
                  are owned directly or indirectly by the Corporation.

         (q)      ERISA: The Employee Retirement Income Security Act of 1974, as
                  amended from time to time.

         (r)      Excess Earnings: A Participant's Earnings in excess of the
                  Participant's Base Earnings.

         (s)      Highly Compensated Eligible Employee: An Eligible Employee who
                  is described in Code section 414(q) and applicable regulations
                  thereunder. An Employee who is described in Code section
                  414(q) and applicable regulations thereunder generally means
                  an Employee who performed services for the Employer or an
                  Affiliated Employer during the "Determination Year" and is in
                  one or more of the following groups:

                  (i)      Employees who at any time during the "Determination
                           Year" or "Look-Back Year" were "Five Percent Owners"
                           of the Employer or an Affiliated Employer. "Five
                           Percent Owner" means any person who owns (or is
                           considered owning within the meaning of Code Section
                           318) more than five percent of the outstanding stock
                           of the Employer or stock possessing more than five
                           percent of the total combined voting power of all
                           stock of the Employer or, in the case of an
                           unincorporated business, any person who owns more
                           than five percent of the capital or profits interest
                           in the Employer. In determining percentage ownership
                           hereunder, employers that would otherwise be
                           aggregated under Code sections 414(b), (c), (m) and
                           (o) shall be treated as separate employers; or

                  (ii)     Employees who received "Compensation" during the
                           "Look-Back Year" from the Employer or an Affiliated
                           Employer in excess of $80,000, adjusted for changes
                           in the cost of living as provided in Code section
                           415(d) and, if the Employer elects, were in the "Top
                           Paid Group" of Employees for the Plan Year. "Top Paid
                           Group" means the top 20 percent of Employees,
                           excluding those Employees described in Code section
                           414(q)(8) and applicable regulations, who performed
                           services during the applicable Year, ranked according
                           to the amount of "Compensation" received from the
                           Employer during such Year.

                  The "Determination Year" shall be the Plan Year for which
                  testing is being performed, and the "Look-Back Year" shall be
                  the immediately preceding 12 month period.

                  An Employer may make a uniform election with respect to all
                  plans of the Employer to apply a calendar year calculation, as
                  permitted by regulations under Code section 414(q).

                  For purposes of this subsection, "Compensation" shall mean
                  compensation as defined in subsection 5.1(d), including
                  elective salary reduction contributions made under this Plan
                  or another cash or deferred arrangement or pursuant to Code
                  section 125.

         (t)      Hours of Service: Each hour for which an Employee is directly
                  or indirectly paid, or entitled to payment, by an Employer for
                  the performance of duties and for reasons other than the
                  performance of duties during the applicable computation
                  period. An Hour of Service shall also include each hour for
                  which back pay, irrespective of mitigation of damages, has
                  been either awarded or agreed to by an Employer. Hours of
                  Service shall be credited to the Employee for the computation
                  period or periods in which the duties are performed or for the
                  period to which the award or agreement pertains, whichever is
                  applicable. Credit for Hours of Service shall be given for
                  periods of absence spent in military service to the extent
                  required by law. Credit for Hours of Service may also be given
                  for such other periods of absence of whatever kind or nature
                  as shall be determined under uniform rules of the Committee.
                  Employment with a company which was not, at the time of such
                  employment, an Employer shall be considered as the performance
                  of duties for an Employer if such employment was continuous
                  until such company was acquired by, merged with, or
                  consolidated with an Employer and such employment continued
                  with an Employer following such acquisition, merger or
                  consolidation. Employment with a Subsidiary that is not an
                  Employer or with an Equity Company shall be considered as
                  performance of duties for an Employer.

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                  Hours of Service shall be calculated and credited in a manner
                  consistent with U.S. Department of Labor regulation Section
                  2530.200b-2(b) and (c), and shall in no event exclude any
                  hours required to be credited under U.S. Department of Labor
                  regulation Section 2530.200b-2(a).

                  For any period or periods for which adequate records are not
                  available to accurately determine the Employee's Hours of
                  Service, the following equivalency shall be used:

                  190 Hours of Service for each month for which such Employee
                  would otherwise receive credit for at least one Hour of
                  Service.

                  Solely for purposes of determining whether an Employee has
                  incurred a One-Year Period of Severance, an Employee who is
                  absent from work:

                  (i)      by reason of the pregnancy of the Employee;

                  (ii)     by reason of the birth of a child of the Employee;

                  (iii)    by reason of a placement of a child with the Employee
                           in connection with the adoption of such child by the
                           Employee; or

                  (iv)     for purpose of caring for such child for a period
                           beginning immediately following such birth or
                           placement,

                  shall be credited with certain Hours of Service which would
                  otherwise have been credited to the Employee if not for such
                  absence. The Hours of Service credited hereunder by reason of
                  such absence shall be credited with respect to the Plan Year
                  in which such absence begins, if such credit is necessary to
                  prevent the Employee from incurring a one-year
                  break-in-service in such Plan Year, and otherwise with respect
                  to the Plan Year immediately following the Plan Year in which
                  such absence begins. In addition, the Hours of Service
                  credited with respect to such absence shall not exceed 501,
                  and shall be credited only to the extent that the Employee
                  substantiates to the satisfaction of the Committee that the
                  Employee's absence, and the length thereof, was for the
                  reasons described in paragraphs (i)-(iv) above.
                  Notwithstanding the foregoing, no Hours of Service shall be
                  credited pursuant to the three immediately preceding sentences
                  with respect to any absence which commences before April 1,
                  1985.

         (u)      Investment Fund: An unsegregated fund of the Plan including
                  the K-C Stock Fund and such other funds as the Named Fiduciary
                  may establish. An Investment Fund, pending investment in
                  accordance with the Investment Fund purpose, may be invested
                  in short-term securities of the United States of America or in
                  other investments of a short-term nature.

         (v)      K-C Stock Fund: An unsegregated Investment Fund to be invested
                  in Corporation Stock, which, pending such investment, may be
                  invested in short-term securities issued or guaranteed by the
                  United States of America or in other investments of a
                  short-term nature.

         (w)      KCTC: A term used to reflect certain units of the Corporation
                  which were formerly part of Kimberly-Clark Tissue Company
                  prior to its liquidation and dissolution as a wholly-owned
                  subsidiary of the Corporation.

         (x)      Lump Sum Distribution: A single distribution of the entire
                  amount of a Participant's Retirement Account.

         (y)      Named Fiduciary: The Retirement Trust Committee (the members
                  of which are designated by the Chief Executive Officer of the
                  Corporation) shall be the Named Fiduciary of the Plan as
                  defined in ERISA.

         (z)      Normal Retirement Age: The later of age 65 or the fifth
                  anniversary of the date the Employee commenced participation
                  in the Plan.

         (aa)     One-Year Period of Severance: The applicable computation
                  period of 12 consecutive months following an Employee's
                  Severance from Service Date during which an Employee fails to
                  accrue a Day of Service. Years of Service and One-Year Periods
                  of Severance shall be measured on the same computation period.

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                  An Employee shall not be deemed to have incurred a One-Year
                  Period of Severance if he completes an Hour of Service within
                  12 months following his Severance from Service Date.

         (bb)     Partial Distribution: A distribution of a portion of a
                  Participant's Retirement Account.

         (cc)     Participant: An Eligible Employee who is eligible to receive a
                  Retirement Contribution pursuant to Article IV. He remains a
                  Participant until his Retirement Account has been distributed
                  pursuant to the Plan.

         (dd)     Participating Unit: A specific classification of Employees of
                  an Employer designated from time to time by the Committee as
                  participating in this Plan. The classifications so designated
                  and effective dates of participation of are shown in Appendix
                  A.

         (ee)     Plan Year: A twelve calendar month period beginning January 1
                  and ending the following December 31.

         (ff)     Retirement Account: The account under the Plan to be
                  maintained for each Participant as provided in Section 4.7.

         (gg)     Retirement Contributions: Employer contributions made pursuant
                  to Article IV of the Plan.

         (hh)     Service: Regular employment with the Corporation, a Subsidiary
                  or an Equity Company, including the limited service of a KCTC
                  Employee receiving payments under the Scott Paper Company
                  Termination Pay Plan for Salaried Employees. For all purposes
                  under the Plan, Service shall include service with KCTC and
                  Scott Paper Company. Service for eligible Employees at
                  Kimberly-Clark Technical Paper, Inc. shall include service
                  with CPM, Inc. prior to May 16, 1995. Service for eligible
                  Employees at Durafab, Inc. ("Durafab") shall include service
                  with Durafab from the later of date of hire at Durafab or
                  September 29, 1989. Service for eligible Employees at Tecnol
                  Medical Products, Inc. ("Tecnol") shall include service with
                  Tecnol prior to December 18, 1997. Service for eligible
                  Employees at Ballard Medical Products, Inc. ("Ballard") shall
                  include service with Ballard prior to September 23, 1999.
                  Service for eligible Employees formerly employed by Safeskin
                  Corporation ("Safeskin") shall include service with Safeskin
                  prior to January 1, 2001.

         (ii)     Severance from Service Date: The earlier of:

                  (i)      the date an Employee quits, is discharged, retires or
                           dies, or

                  (ii)     the first anniversary of the date an Employee is
                           absent from Service for any reason other than a quit,
                           discharge, retirement, or death (e.g., disability,
                           leave of absence, or layoff, etc.)

         (jj)     Subsidiary: Any corporation, 50% or more of the voting shares
                  of which are owned directly or indirectly by the Corporation,
                  which is incorporated under the laws of one of the States of
                  the United States.

         (kk)     Taxable Wage Base: With respect to any Plan Year, the maximum
                  amount of Compensation which may be considered wages for
                  old-age, survivors and disability insurance purposes under
                  Section 230 of the Social Security Act as in effect on the
                  first day of the Plan Year.

         (ll)     Terminated Participant: A Participant who has terminated his
                  employment with an Employer prior to January 1, 1998 (i) with
                  the aggregate value of the Participant's Retirement Account
                  exceeding $3,500, or (ii) a Participant who has terminated
                  employment with his Employer on or after January 1, 1998 with
                  the aggregate value of the Participant's Accounts exceeding
                  $5,000, and who has not elected to receive a distribution
                  under the Plan.

         (mm)     Timely Notice: A notice (i) in writing on forms, (ii) by
                  electronic medium, or (iii) by voice transmission, as
                  prescribed by the Committee and made at such places and at
                  such times as shall be established by Committee rules.

         (nn)     Trust: The Kimberly-Clark Corporation Defined Contribution
                  Plans Trust pursuant to the trust agreement provided for in
                  Article VI.

         (oo)     Trustee: The trustee under the Trust.

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         (pp)     Valuation Date: Each Business Day for which the Current Market
                  Value of a Participant's Retirement Account is determined for
                  purposes of this Plan.

         (qq)     Year of Service: An Employee shall accrue a Year of Service
                  for each 365 Days of Service. If the total of an Employee's
                  Service exceeds his whole Years of Service, then such Employee
                  shall be credited with an additional fraction of a Year of
                  Service, the numerator of which shall be the total number of
                  his Days of Service represented by such excess and the
                  denominator of which shall be 365. If the total of an
                  Employee's Service is less than one Year of Service, then such
                  Employee shall be credited with a fraction of a Year of
                  Service, the numerator of which shall be the total number of
                  his Days of Service and the denominator of which shall be 365.

2.2      Construction. Where appearing in the Plan, the masculine shall include
         the feminine and the plural shall include the singular, unless the
         context clearly indicates otherwise. The words "hereof," "herein,"
         "hereunder" and other similar compounds of the word "here" shall mean
         and refer to the entire Plan and not to any particular Section or
         subsection.

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                                   ARTICLE III

                                  PARTICIPATION

3.1 Effective Dates of Participation.

         (a)      Each Eligible Employee who (i) has at least one Hour of
                  Service on December 31, 1996 and is an active Eligible
                  Employee on January 1, 1997; and (ii) is a participant who is
                  eligible to be credited with additional Years of Benefit
                  Service as defined in the Kimberly-Clark Corporation Salaried
                  Employees' Retirement Plan or Kimberly-Clark Corporation
                  Hourly Employees' Standard Retirement Plan as of January 1,
                  1997, shall have the opportunity to make a one-time election
                  on or before June 30, 1997 to become a Participant in the
                  Plan, and such Eligible Employee who affirmatively elects
                  shall become a Participant in the Plan effective as of July 1,
                  1997.

                  Notwithstanding the foregoing, an Eligible Employee who is
                  eligible to elect, and who does not affirmatively elect to
                  become a Participant in the Plan, or who affirmatively elects
                  not to become a Participant in the Plan, shall remain a
                  participant in the Kimberly-Clark Corporation Salaried
                  Employees' Retirement Plan or Kimberly-Clark Corporation
                  Hourly Employees' Standard Retirement Plan, as applicable, in
                  accordance with the terms thereof, and no Retirement
                  Contributions shall be made for such Employee.

         (b)      An Eligible Employee who is an active Employee of KCTC in a
                  Participating Unit as of December 31, 1996 and who has an Hour
                  of Service hereunder on January 1, 1997 and, as of January 1,
                  1997, is not receiving termination payments under the Scott
                  Paper Company Termination Pay Plan for Salaried Employees nor
                  on a transition assignment and expected to receive termination
                  payments under the Scott Paper Company Termination Pay Plan
                  for Salaried Employees, shall become a Participant in the Plan
                  as of January 1, 1997, and such Eligible Employee's investment
                  elections in effect under the Kimberly-Clark Tissue Company
                  Investment Plan for Salaried Employees or Kimberly-Clark
                  Tissue Company Investment Plan for Hourly Employees (the "KCTC
                  Investment Plans"), as applicable, shall remain in effect
                  hereunder; provided, however that an Employee of KCTC who is
                  not actively employed on January 1, 1997 in a Participating
                  Unit shall become a participant in the Plan upon his return to
                  active employment, and his investment elections in effect
                  under the applicable KCTC Investment Plan shall remain in
                  effect hereunder.

         (c)      An hourly organized Eligible Employee at Mobile who (i) has at
                  least one Hour of Service on September 1, 1997 and is an
                  active Eligible Employee on January 1, 1998; and (ii) is a
                  participant, or who will be a participant upon meeting the
                  one-year eligibility requirement, eligible to be credited with
                  additional years of Credited Employment under the
                  Kimberly-Clark Tissue Company Pension Plan for Hourly
                  Employees (Non-Contributory), shall have the opportunity to
                  make a one-time election on or before December 31, 1997 to
                  become a Participant in the Plan, and such Eligible Employee
                  who affirmatively elects shall become a Participant in the
                  Plan effective January 1, 1998.

                  An hourly organized Eligible Employee at Mobile who (i) is
                  hired after September 1, 1997 and prior to January 1, 2000;
                  (ii) has at least one Hour of Service on December 31, 1999 and
                  is an active Eligible Employee on January 1, 2000; and (ii) is
                  a participant, or who will be a participant upon meeting the
                  one-year eligibility requirement, eligible to be credited with
                  additional years of Credited Employment under the
                  Kimberly-Clark Tissue Company Pension Plan for Hourly
                  Employees (Non-Contributory), shall have the opportunity to
                  make a one-time election on or before December 31, 1999 to
                  become a Participant in the Plan, and such Eligible Employee
                  who affirmatively elects shall become a Participant in the
                  Plan effective January 1, 2000.

                  Notwithstanding the foregoing, an Eligible Employee who is
                  eligible to elect, and who does not affirmatively elect to
                  become a Participant in the Plan, or who affirmatively elects
                  not to become a Participant in the Plan, shall remain a
                  participant in the Kimberly-Clark Tissue Company Pension Plan
                  for Hourly Employees (Non-Contributory) in accordance with the
                  terms thereof, and no Retirement Contributions shall be made
                  for such Employee.

         (d)      An hourly organized Eligible Employee at Fullerton who (i) has
                  at least one Hour of Service on December 31, 1998 and is an
                  active Eligible Employee on January 1, 1999; and (ii) is a
                  participant who is eligible to be credited with additional
                  Years of Benefit Service as defined in Kimberly-Clark
                  Corporation Hourly Employees' Standard

                                      174
<PAGE>   13

                  Retirement Plan as of January 1, 1999, shall have the
                  opportunity to make a one-time election on or before December
                  31, 1998 to become a Participant in the Plan, and such
                  Eligible Employee who affirmatively elects shall become a
                  Participant in the Plan effective January 1, 1999.

                  Notwithstanding the foregoing, an Eligible Employee who is
                  eligible to elect, and who does not affirmatively elect to
                  become a Participant in the Plan, or who affirmatively elects
                  not to become a Participant in the Plan, shall remain a
                  participant in the Kimberly-Clark Corporation Hourly
                  Employees' Standard Retirement Plan in accordance with the
                  terms thereof, and no Retirement Contributions shall be made
                  for such Employee.

         (e)      An hourly organized Eligible Employee at Chester who (i) has
                  at least one Hour of Service on September 5, 1998 and is an
                  active Eligible Employee on January 1, 1999, or is on layoff
                  with recall rights pursuant to the terms of the collective
                  bargaining agreement or on temporary disability leave on
                  September 5, 1998 and remains as such on January 1, 1999; and
                  (ii) is a participant, or who will be a participant upon
                  meeting the one-year eligibility requirement, eligible to be
                  credited with additional years of Credited Employment under
                  the Kimberly-Clark Tissue Company Pension Plan for Hourly
                  Employees, shall have the opportunity to make a one-time
                  election on or before December 31, 1998 to become a
                  Participant in the Plan, and such Eligible Employee who
                  affirmatively elects shall become a Participant in the Plan
                  effective January 1, 1999.

                  Notwithstanding the foregoing, an Eligible Employee who is
                  eligible to elect, and who does not affirmatively elect to
                  become a Participant in the Plan, or who affirmatively elects
                  not to become a Participant in the Plan, shall remain a
                  participant in the Kimberly-Clark Tissue Company Pension Plan
                  for Hourly Employees in accordance with the terms thereof, and
                  no Retirement Contributions shall be made for such Employee.

         (f)      Each Eligible Employee who commences employment with a
                  Participating Unit (other than Mobile hourly organized) on or
                  after the effective date for the Participating Unit shown in
                  Appendix A, or returns to work with a Participating Unit
                  (other than Mobile hourly organized) on or after the effective
                  date for the Participating Unit shown in Appendix A, shall
                  become a Participant in the Plan on his employment or
                  reemployment date, as applicable.

                  Each hourly organized Eligible Employee who commences
                  employment at Mobile on or after January 1, 2000, or returns
                  to work at Mobile on or after January 1, 2000, shall become a
                  Participant in the Plan on his employment or reemployment
                  date, as applicable.

         (g)      Notwithstanding the foregoing, an Eligible Employee who (i)
                  had an Hour of Service with Kimberly-Clark Inc. or
                  Kimberly-Clark Forest Products, Inc. on or after December 31,
                  1996 and (ii) commences employment with a Participating Unit
                  on or after January 1, 1997 and prior to May 1, 1997, shall
                  not participate in the Plan after May 31, 1997, and shall not
                  have the opportunity to make a one-time election to become a
                  Participant in the Plan as provided in subsection 3.1(a)
                  above.

         (h)      Notwithstanding the foregoing, an hourly organized Eligible
                  Employee at the Everett Mill, Marinette Mill or either the
                  Kimtech Machinists Unit or the Kimtech Machinery Installation
                  Unit who (i) has at least one Hour of Service on December 31,
                  2000 and is an active Eligible Employee on January 1, 2001;
                  and (ii) is a participant who is eligible to be credited with
                  additional "Years of Benefit Service" as defined in KC Hourly
                  Schedule of the Kimberly-Clark Corporation Pension Plan, or
                  "Credited Employment" as defined in the KCTC Hourly Schedule
                  or KCTC Hourly (Non-Contributory) Schedule of the
                  Kimberly-Clark Corporation Pension Plan, as of January 1,
                  2001, shall have the opportunity to make a one-time election
                  on or before December 31, 2000 to become a Participant in the
                  Plan, and such Eligible Employee who affirmatively elects
                  shall become a Participant in the Plan effective January 1,
                  2001.

                  Notwithstanding the foregoing, an Eligible Employee who is
                  eligible to elect, and who does not affirmatively elect to
                  become a Participant in the Plan, or who affirmatively elects
                  not to become a Participant in the Plan, shall remain a
                  participant in the Kimberly-Clark Corporation Pension Plan in
                  accordance with the terms thereof, and no Retirement
                  Contributions shall be made for such Employee.

                                      175
<PAGE>   14

3.2      Transfer To and From Participating Units

         (a)      An Eligible Employee who transfers out of a Participating Unit
                  shall cease to be a Participant in the Plan as of the date on
                  which he transfers out of such Participating Unit.

         (b)      An Eligible Employee who transfers into a Participating Unit
                  shall become a Participant in the Plan as of the date on which
                  he transfers into such Participating Unit.

3.3      Nonduplication of Accruals for Participation in Other Plans

         Notwithstanding any other provision of the Plan, no Retirement
         Contributions shall be made for an Employee during any period in which
         such Employee is eligible to receive years of Benefit Service under the
         Kimberly-Clark Corporation Salaried Employees' Retirement Plan or the
         Kimberly-Clark Corporation Hourly Employees' Standard Retirement Plan,
         or Credited Employment under the Kimberly-Clark Tissue Company Pension
         Plan for Salaried Employees, the Kimberly-Clark Tissue Company Pension
         Plan for Hourly Employees or the Kimberly-Clark Tissue Company Pension
         Plan for Hourly Employees (Non-Contributory).

                                      176
<PAGE>   15

                                   ARTICLE IV

                            RETIREMENT CONTRIBUTIONS

4.1      Retirement Contributions. Each Eligible Employee who is a Participant
         under Article III of the Plan shall be allocated Retirement
         Contributions as provided in Section 4.3.

         Notwithstanding any provision of the Plan to the contrary, Retirement
         Contributions and Service credit with respect to qualified military
         service will be provided in accordance with Section 414(u) of the Code.

4.2      Limited Service and Leave of Absence. All Participants who are actively
         employed and receiving Earnings, or who are entitled to receive
         benefits under the Scott Paper Company Termination Pay Plan for
         Salaried Employees commencing after January 1, 1997, are entitled to be
         allocated Retirement Contributions. Participants who are not actively
         employed due to a paid leave of absence shall be allocated Retirement
         Contributions made during such period of absence. Retirement
         Contributions on behalf of a Participant shall cease upon commencement
         of his unpaid leave of absence, and such Retirement Contributions shall
         resume upon the termination of such leave.

4.3      Amount of Retirement Contribution. Subject to the limitations set forth
         in Article V:

         (a)      For each Plan Year, the Employer shall pay or cause to be paid
                  to the Trustee, contributions to the Plan that shall be
                  allocated to the Retirement Account of each Participant
                  eligible for an allocation as determined below. The Retirement
                  Contribution for any Plan Year shall be sufficient to credit
                  each such Participant's Retirement Account with an amount
                  equal to the percentage in Column A of Base Earnings plus the
                  percentage in Column B of Excess Earnings, based on the
                  Participant's age as of the last day of the Plan Year:

<TABLE>
<CAPTION>
                                                        COLUMN A                               COLUMN B
                                                Contribution Percentage                Contribution Percentage
                        Age Range                   of Base Earnings                      of Excess Earnings
                        ---------                   ----------------                      ------------------
<S>                     <C>                           <C>                                    <C>
                         Under 25                        3.50%                                  5.75%
                          25-29                          3.75%                                  6.00%
                          30-34                          4.00%                                  6.25%
                          35-39                          4.25%                                  6.50%
                          40-44                          4.50%                                  6.75%
                          45-49                          5.25%                                  7.50%
                          50-54                          6.00%                                  8.25%
                       55 and over                       6.50%                                  8.75%
</TABLE>

         (b)      Notwithstanding the foregoing, for each Plan Year, the
                  Employer shall pay or cause to be paid to the Trustee,
                  contributions to the Plan that shall be allocated to the
                  Retirement Account of each eligible (i) hourly Participant at
                  Durafab, Inc., (ii) hourly organized Participant at Mobile,
                  Chester, and Marinette, and (iii) hourly Participant at
                  Ballard Medical Products eligible for an allocation as
                  determined below.

<TABLE>
<CAPTION>
                        Age Range                     Contribution Percentage of Eligible Earnings
                        ---------                     --------------------------------------------
<S>                     <C>                           <C>
                         Under 25                                      2.05%
                          25-29                                        2.20%
                          30-34                                        2.35%
                          35-39                                        2.45%
                          40-44                                        2.60%
                          45-49                                        3.05%
                          50-54                                        3.50%
                       55 and over                                     3.80%
</TABLE>

         (c)      Notwithstanding the foregoing, for each Plan Year, the
                  Employer shall pay or cause to be paid to the Trustee,
                  contributions to the Plan that shall be allocated to the
                  Retirement Account of each eligible hourly organized
                  Participant at Everett eligible for an allocation as
                  determined below.

                                      177
<PAGE>   16

<TABLE>
<CAPTION>
                        Age Range                    Contribution Percentage of Eligible Earnings
                        ---------                    --------------------------------------------
<S>                     <C>                           <C>
                         Under 25                                      2.20%
                          25-29                                        2.35%
                          30-34                                        2.50%
                          35-39                                        2.65%
                          40-44                                        2.80%
                          45-49                                        3.25%
                          50-54                                        3.75%
                       55 and over                                     4.05%
</TABLE>

4.4      Contributions by Participants. Participants shall not make
         contributions under this Plan. The amount of any Participant
         contribution under this Plan which is determined to have been
         erroneously made, as adjusted for income, gain and loss of the Trust
         for the time such contribution was retained under the Plan, shall be
         repaid as soon as practicable after such determination to such
         Participant if living; otherwise, as may be required by law.

4.5      Temporary Suspension of Retirement Contributions. The Board may order
         the suspension of all Retirement Contributions if, in its opinion, the
         Corporation's consolidated net income after taxes for the last fiscal
         year is substantially below the Corporation's consolidated net income
         after taxes for the immediately preceding fiscal year. Any such
         determination by the Board shall be communicated to all Eligible
         Employees and to all Participants reasonably in advance of the first
         date for which such temporary suspension is ordered.

4.6      Allocations to Retirement Accounts. Retirement Contributions made
         pursuant to Section 4.3 shall be allocated to the Retirement Account of
         each Participant as soon as administratively possible following payment
         to the Trust.

4.7      Valuation. Each Investment Fund and each Retirement Account shall be
         valued by the Trustee on each Valuation Date:

         (a)      by determining the Current Market Value, as of the Valuation
                  Date, of all securities and property which are then held in
                  the Trust,

         (b)      by adding thereto the amount of any uninvested cash and
                  accrued income, or subtracting any losses incurred as of the
                  Valuation Date, and

         (c)      by subtracting any fees and expenses described in Article VI.

         All amounts to be distributed pursuant to the provisions of Article IX
         hereof as of the relevant Valuation Date shall be taken into account in
         valuing the Investment Funds and each Retirement Account pursuant to
         the provisions of this Section 4.7.

4.8      Payment of Contributions to Trustee. Amounts representing Retirement
         Contributions shall, not less frequently than monthly, be paid into the
         Trust.

4.9      Deductibility Requirement. All Retirement Contributions under the Plan
         are conditioned upon the deductibility of such Retirement Contributions
         under Section 404 of the Code and to the extent the deduction is
         disallowed, shall be returned to the Employer within one year after the
         disallowance of the deduction. Earnings attributable to such Retirement
         Contributions shall not be returned to the Employer but losses
         attributable thereto shall reduce the amount to be so returned. For
         purposes of this Section 4.10, Retirement Contributions which are not
         deductible in the current taxable year of the Employer but which may be
         deducted in taxable years subsequent to the year in respect of which it
         is made, shall not be considered to be disallowed.

4.10     Mistaken Contributions. If Retirement Contributions are made by reason
         of a mistake of fact, such Retirement Contributions shall be returned
         to the Employer within one year after such Retirement Contributions are
         made. The amount which may be returned to the Employer shall not exceed
         the excess of (i) the amount contributed, over (ii) the amount that
         would have been contributed had there not occurred a mistake of fact or
         a mistake in determining the deduction. Earnings attributable to the
         excess Retirement Contributions shall not be returned to the Employer
         but losses attributable thereto shall reduce the amount to be so
         returned.

                                      178
<PAGE>   17

4.11     General Limitation. Notwithstanding any other provision of this Article
         IV, no Retirement Contribution shall be made to the Plan which would
         cause the Plan to fail to meet the requirements for exemption from tax
         or to violate any provisions of the Code.

                                      179
<PAGE>   18

                                    ARTICLE V

                             LIMITATIONS ON BENEFITS

I.       Limitations on Benefits. Anything to the contrary herein
         notwithstanding, no Retirement Contribution hereunder shall be made
         which will violate the limitations set forth below:

         A.       The Annual Addition to a Participant's Retirement Account (as
                  such term is defined below) in any Plan Year either solely
                  under the Plan or under an aggregation of the Plan with all
                  other qualified defined contribution plans of the Employer may
                  not exceed the lesser of (i) $30,000, (or such other amount as
                  may be prescribed under regulations issued by the Secretary of
                  the Treasury under Section 415(d) of the Code), or (ii)
                  twenty-five percent (25%) of the Employee's total Compensation
                  for the Plan Year.

         B.       If a Participant also participates under any other qualified
                  defined contribution plan or any qualified defined benefit
                  plan maintained by the Employer or an Affiliated Employer, all
                  such defined contribution plans shall be considered as one
                  defined contribution plan, and all such defined benefit plans
                  shall be considered as one defined benefit plan. In such
                  event, the sum of the defined contribution plan fraction and
                  the defined benefit plan fraction for any Plan Year shall not
                  exceed 1.0. In determining the allowable limitation referred
                  to in the preceding sentence:

                  1.       The defined benefit plan fraction shall be determined
                           by dividing the projected annual benefit of the
                           Participant under the defined benefit plan by the
                           lesser of:

                           a)       the product of 1.25 and $90,000 (subject to
                                    all adjustments as are permitted by, or
                                    required under, Section 415 of the Code), or

                           b)       the product of 1.4 and 100% of the
                                    Participant's average annual total
                                    Compensation for his highest three
                                    consecutive years; and

                  2.       The defined contribution plan fraction shall be
                           determined by dividing the sum of all Annual
                           Additions (as such term is defined below) for all
                           years in which he or she was a participant in any
                           such defined contribution plans by the sum of the
                           lesser of (i) or (ii) below for each year during
                           which the Participant was an employee of the
                           Employer:

                           a)       the product of 1.25 and the dollar
                                    limitation in effect under Section
                                    415(c)(1)(A) of the Code for such year, or

                           b)       the product of 1.4 and 25% of the
                                    Participant's total Compensation for such
                                    year.

                  In the event that the sum of the defined contribution plan
                  fraction and the defined benefit plan fraction would exceed
                  the allowable limitation for any Plan Year, the Participant's
                  anticipated benefit under the defined benefit plan shall be
                  reduced accordingly.

         Effective January 1, 2000, this Subsection 5.1(b) shall no longer apply
         under the Plan.

         (c)      For purposes of this Section 5.1, the term "Annual Addition"
                  as applied to each Participant shall mean the sum of the
                  following amounts allocated to the Participant's Retirement
                  Account under the Plan or any other qualified defined
                  contribution plan or qualified defined benefit plan of the
                  Employer or any Affiliated Employer: (1) matching employer
                  contributions, Retirement Contributions and pre-tax
                  contributions (excluding any previously distributed pre-tax
                  contributions) and any other employer contributions; (2)
                  forfeitures; and (3) and any other employee contributions.
                  Amounts described in Section 415(l) and 419A(d)(2) of the Code
                  contributed for any Plan

                                      180
<PAGE>   19

                  Year for the benefit of the Participant shall be treated as an
                  Annual Addition to the extent provided in such Sections. If a
                  Participant's Retirement Contributions under this Plan are to
                  be reduced as a result of this Section 5.1, such reduction
                  shall be effected by first reducing the Participant's
                  Retirement Contributions under this Plan, and second, to the
                  extent necessary, by reducing any contributions under any
                  other qualified defined contribution plan of the Employer or
                  any Affiliated Employer.

         (d)      For purposes of this Section, "Compensation":

                  (i)      includes amounts actually paid or made available to a
                           Participant (regardless of whether he was such during
                           the entire Plan Year);

                           (A)      as wages, salaries, fees for professional
                                    service, and other amounts received for
                                    personal services actually rendered in the
                                    course of employment with the Employer or
                                    Affiliated Employer including but not
                                    limited to commissions, compensation for
                                    services on the basis of a percentage of
                                    profits and bonuses;

                           (B)      for purposes of (c) above, earned income
                                    from sources outside the United States (as
                                    defined in Code section 911(b)); whether or
                                    not excludable from gross income under Code
                                    section 911 or deductible under Code section
                                    913;

                           (C)      amounts described in Code sections
                                    104(a)(3), 105(a) and 105(h) but only to the
                                    extent that these amounts are includable in
                                    the gross income of the Participant;

                           (D)      amounts paid or reimbursed by the Employer
                                    or Affiliated Employer for moving expenses
                                    incurred by the Participant, but only to the
                                    extent that these amounts are not deductible
                                    by the Participant under Code section 217;

                           (E)      value of a nonqualified stock option granted
                                    to the Participant, but only to the extent
                                    that the value of the option is includable
                                    in the gross income of the Participant in
                                    the taxable year in which granted;

                           (F)      the amount includable in the gross income of
                                    a Participant upon making the election
                                    described in Code section 83(b).

                  (ii)     excludes -

                           (A)      amounts contributed by an Employer or
                                    Affiliated Employer on behalf of
                                    Participants under a cash or deferred
                                    arrangement and any amount which is
                                    contributed or deferred by the Employer or
                                    Affiliated Employer at the election of the
                                    Employee under Section 125 of the Code;
                                    provided, however that for Plan Years
                                    beginning after December 31, 1997, such
                                    amounts shall be included as "Compensation"
                                    with respect to such Plan Year.

                           (B)      contributions made by the Employer or
                                    Affiliated Employer to a plan of deferred
                                    compensation to the extent that, before the
                                    application of the Code section 415
                                    limitations to that plan, the contributions
                                    are not includable in the gross income of
                                    the Participant for the taxable year in
                                    which contributed and any distributions from
                                    a plan of deferred compensation, regardless
                                    of whether such amounts are includable in
                                    the gross income of the Participant when
                                    distributed; provided however, any amounts
                                    received by a Participant pursuant to an
                                    unfunded nonqualified plan shall be
                                    considered as Compensation in the year such
                                    amounts are includable in the gross income
                                    of the Participant;

                                      181
<PAGE>   20

                           (C)      amounts realized from the exercise of a
                                    nonqualified stock option, or recognized
                                    when restricted stock (or property) held by
                                    a Participant either becomes freely
                                    transferable or is no longer subject to a
                                    substantial risk of forfeiture pursuant to
                                    Code section 83 and the regulations
                                    thereunder;

                           (D)      amounts realized from the sale, exchange or
                                    other disposition of stock acquired under a
                                    qualified stock option;

                           (E)      other amounts which receive special tax
                                    benefits such as premiums for group term
                                    life insurance (but only to the extent that
                                    the premiums are not includable in the gross
                                    income of the Participant); and

                           (F)      Compensation in excess of the limit set
                                    forth in Section 12.10.

                  In lieu of the above definition of "Compensation," the
                  following alternative definitions of "Compensation" in (i) or
                  (ii) below may be applied with respect to a Plan Year as
                  determined by the Committee in its discretion:

                  (i)      Wages within the meaning of Section 3401(a) of the
                           Code and all other payments of compensation to an
                           Employee by his Employer (in the course of the
                           Employer's trade or business) for which the Employer
                           is required to furnish the Employee a written
                           statement under Section 6041(d), 6051(a)(3), and 6052
                           of the Code, but excluding amounts paid or reimbursed
                           by the Employer for moving expenses incurred by an
                           Employee, but only to the extent that at the time of
                           the payment it is reasonable to believe that these
                           amounts are deductible by the Employee under Section
                           217 of the Code, and determined without regard to any
                           rules under Section 3401(a) of the Code that limit
                           the remuneration included in wages based on the
                           nature or location of the employment or the services
                           performed.

                  (ii)     Wages within the meaning of Section 3401(a) of the
                           Code (for purposes of income tax withholding at the
                           source) of the Participant but determined without
                           regard to any rules that limit the remuneration
                           included in wages based on the nature or location of
                           the employment or the services performed.

                  For Plan Years beginning after December 31, 1997,
                  "Compensation" hereunder includes amounts contributed or
                  deferred by the Employer on behalf of the Employee under
                  Sections 125 or 401(k) of the Code.

5.2      Aggregation of Plans. For purposes of Section 5.2, this Plan shall be
         aggregated and treated as a single plan with other plans maintained by
         the Employer or any Affiliated Employer to the extent that this Plan is
         aggregated with any other plan for purposes of satisfying Section
         410(b) of the Code (other than Section 410(b)(2)(A)(ii) of the Code).

                                      182
<PAGE>   21

                                   ARTICLE VI

                   TRUSTEE, TRUST AGREEMENT AND PLAN EXPENSES

I. Trust                                                              Agreement.
   -----------------------------------------------------------------------------

         A.       The Corporation shall enter into a trust agreement with a
                  person or corporation selected by the Chief Executive Officer
                  of the Corporation to act as Trustee of Retirement
                  Contributions. The Trustee shall receive all Retirement
                  Contributions and shall hold, manage, administer, and invest
                  the same, reinvest any income, and, in accordance with
                  instructions and directions of the Committee subject to the
                  Plan, make distributions.

         B.       The trust agreement shall be in such form and contain such
                  provisions as the Chief Executive Officer of the Corporation
                  may deem necessary and appropriate to effectuate the purposes
                  of the Plan and to qualify the Plan and the Trust under the
                  Code. Upon the written request of an Eligible Employee, a copy
                  of the trust agreement shall be made available for his
                  inspection.

         C.       The Chief Executive Officer of the Corporation may, from time
                  to time, remove the Trustee or any successor Trustee at any
                  time and any such Trustee or any successor Trustee may resign.
                  The Chief Executive Officer of the Corporation shall, upon
                  removal or resignation of a Trustee, appoint a successor
                  Trustee.

         D.       The Trustee's accounts, books, and records relating to the
                  Trust may be audited annually by auditors selected by the
                  Chief Executive Officer of the Corporation.

         E.       Brokerage fees, asset management fees, investment management
                  fees and other direct costs of investment and taxes (including
                  interest and penalties) shall be paid by the Trustee out of
                  the funds of the Trust to which such costs are attributable,
                  unless paid by the Corporation in its discretion.

II.      Establishment of Investment Funds. The Trust shall consist of the K-C
         Stock Fund and such other Funds as have been established by the Named
         Fiduciary. The Named Fiduciary may, from time to time, in its
         discretion, establish additional funds or terminate any Fund. The Funds
         may include, but shall not be limited to, funds managed by the Trustee,
         by an insurance company, or by an investment company regulated under
         the Investment Company Act of 1940.

III.     Fund Investments. Any of the Funds referred to in Section 6.2 above
         may, in whole or in part, be invested in any common, collective, or
         commingled trust fund maintained by the Trustee or another financial
         institution, which is invested principally in property of the kind
         specified for that particular investment Fund or for the temporary
         investment of assets, and which is maintained for the investment of the
         assets of plans and trusts which are qualified under the provisions of
         Section 401(a) of the Code and exempt from Federal taxation under the
         provisions of Section 501(a) of the Code, and during such period of
         time as an investment through any such medium exists the declaration of
         trust of such trust shall constitute a part of the applicable Trust
         Agreement.

IV.      Reinvestment of Income. All interest, dividends, and other income, as
         well as cash received from the sale or exchange of securities or other
         property, produced by each of the Funds or any losses incurred by each
         of the Funds, shall be reinvested in or deducted from the same Fund
         which produced such proceeds, interest, dividends other income or
         losses.

V.       Plan Expenses. The expenses of administering the Plan, including
         Trustee's fees, shall be paid from the Trust and allocated among the
         Retirement Accounts of the Participants and Terminated Participants
         except to the extent that the Corporation, in its sole discretion, has
         determined that the Employer shall pay any such expenses. The transfer
         taxes, brokerage fees and other expenses in connection with the
         purchase, sale or distribution of Corporation Stock shall be paid by
         the Trust, and shall be deemed part of the cost of such Corporation
         Stock, or deducted in computing the sale proceeds therefrom, as the
         case may be

                                      183
<PAGE>   22

         except to the extent that the Corporation, in its sole discretion,
         determines that such taxes, fees or expenses (other than transfer taxes
         on distribution) shall be paid by the Employer.

                                      184
<PAGE>   23

                                   ARTICLE VII

                              INVESTMENT DIRECTIONS

7.1      Investment of Contributions. Each Eligible Employee upon becoming a
         Participant shall, upon Timely Notice, direct that his Retirement
         Contributions be paid into and invested in any one or more of the
         Investment Funds in such percentages as the Participant may direct;
         provided, however, that such percentage investment in any Investment
         Fund shall be in multiples of one percent (1%) of his Retirement
         Contributions. In the event the Participant does not elect the manner
         in which his Retirement Contributions are to be invested, the Trustee
         shall invest such contributions in the Money Market Fund (as defined in
         the Kimberly-Clark Corporation Salaried Employees Incentive Investment
         Plan) until such time as the Participant elects the manner in which his
         Retirement Contributions are to be invested.

7.2      Investment Election. The percentage investment of a Participant's
         future Retirement Contributions to be paid into and invested in any one
         or more of the Investment Funds may be changed upon Timely Notice;
         provided, however, that such percentage investment in any Investment
         Fund shall be in multiples of one percent (1%) of the Retirement
         Contributions.

7.3      Reallocations. A Participant may, by making a request in the manner,
         and subject to any restrictions, prescribed by the Committee, direct
         that any portion, in multiples of one percent (1%), of his interest in
         any one or more of the Investment Funds be reallocated to any one or
         more of the other Investment Funds.

7.4      Fund Transfers: A Participant may, by making a request in the manner,
         and subject to any restrictions, prescribed by the Committee, direct
         that any portion, either in multiples of one percent (1%) or in a
         dollar amount, of his interest in any one or more of the Investment
         Funds be transferred to any one or more of the other Investment Funds.

7.5      Effective Date of Investment Changes. Any request made pursuant to the
         provisions of Sections 7.1 through 7.4 above may be made upon Timely
         Notice and, subject to any restrictions prescribed by the Committee,
         shall take effect as soon as practicable after such request is
         received.

7.6      Valuation. Any reallocation or transfer made pursuant to the provisions
         of Section 7.3 or 7.4 shall be based upon the value of the
         Participant's interest in any Investment Fund on the Valuation Date on
         which such transaction takes effect, subject to any restrictions
         prescribed by the Committee.

7.7      Voting of Corporation Stock. A Participant (or in the event of his
         death, his Beneficiary) may direct the voting at each annual meeting
         and at each special meeting of the stockholders of the Corporation of
         that number of whole shares attributable to the balances in his K-C
         Stock Fund Account as of the Valuation Date coincident with the record
         date for such meeting. Each such Participant (or Beneficiary) will be
         provided with copies of pertinent proxy solicitation material together
         with a request for his confidential instructions as to how such shares
         are to be voted. The Committee shall direct the Trustee to vote such
         shares in accordance with such instructions and shall also direct the
         Trustee how to vote any shares of Corporation Stock at any meeting for
         which it has not received, or is not subject to receiving, such voting
         instructions. Notwithstanding the foregoing, a Participant's (or
         Beneficiary's) voting instructions shall apply to the balances in his
         K-C Stock Fund Accounts for all plans maintained by an Employer in
         which he participates.

7.8      Tender Offers. A Participant (or in the event of his death, his
         Beneficiary) may direct the Trustee in writing how to respond to a
         tender or exchange offer for any or all whole shares of Corporation
         Stock held by the Trustee and attributable to the balances in the K-C
         Stock Fund Account as of the Valuation Date coincident with such offer.
         The Committee shall notify each Participant (or Beneficiary) and exert
         its best efforts to timely distribute or cause to be distributed to him
         such information as will be distributed to stockholders of the
         Corporation in connection with any such tender or exchange offer. Upon
         receipt of such instructions, the Trustee shall tender such shares of
         Corporation Stock as and to the extent so instructed. If the Trustee
         shall not receive instructions from a Participant (or Beneficiary)
         regarding any such tender or exchange offer for such shares of
         Corporation Stock (or shall receive instructions not to tender or
         exchange such shares), the Trustee shall

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<PAGE>   24

         have no discretion in such matter and shall take no action with respect
         thereto. With respect to shares of Corporation Stock in the K-C Stock
         Fund for which the Trustee is not subject to receiving such
         instructions, however, the Trustee shall tender such shares in the same
         ratio as the number of shares for which it receives instructions to
         tender bears to the total number of shares for which it is subject to
         receiving instructions, and shall have no discretion in such matter and
         shall take no action with respect thereto other than as specifically
         provided in this sentence. Notwithstanding the foregoing, a
         Participant's (or Beneficiary's) voting instructions shall apply to the
         balances in his K-C Stock Fund Accounts for all plans maintained by an
         Employer in which he participates.

7.9      Stock Rights, Stock Splits and Stock Dividends. A Participant shall
         have no right of request, direction or demand upon the Committee or the
         Trustee to exercise in his behalf rights to purchase shares of
         Corporation Stock or other securities of the Corporation. The Trustee,
         at the direction of the Committee, shall exercise or sell any rights to
         purchase shares of Corporation Stock appertaining to shares of such
         stock held by the Trustee and shall sell at the direction of the
         Committee any rights to purchase other securities of the Corporation
         appertaining to shares of Corporation Stock held by the Trustee. The
         Retirement Accounts of Participants shall be appropriately credited.
         Shares of Corporation Stock received by the Trustee by reason of a
         stock split or stock dividend shall be appropriately allocated to the
         Retirement Accounts of Participants.

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                                  ARTICLE VIII

                                     VESTING

8.1      Five Years of Service. A Participant's interest in his Retirement
         Account shall be fully vested upon the Participant's completion of five
         Years of Service; provided, however, that a Participant who was
         employed by Scott Paper Company on December 12, 1995 shall be fully
         vested in his Retirement Account.

8.2      Other Vesting Events. Notwithstanding the above, each Participant's
         interest in his Retirement Contributions (and any earnings thereon)
         made on his behalf shall be vested in such Participant in whole, upon

         (a)      his attainment of Normal Retirement Age or upon termination of
                  employment due to his death; or

         (b)      the termination or partial termination of the Plan, or the
                  complete discontinuance of all Retirement Contributions under
                  the Plan (provided, however, that such discontinuance or
                  partial termination relates to such Participant).

8.3      Forfeitures and Restorations. If a Participant incurs a Severance from
         Service Date other than by reason of an event described in Section 8.2
         above, his interest in unvested Retirement Contributions and any
         earnings thereon shall be forfeited for the Plan Years in which (a) the
         Participant incurs five consecutive One-Year Periods of Severance or
         (b) if earlier, the Participant receives a distribution of his entire
         vested interest in his Retirement Account. A Participant who is not
         vested on his Severance from Service Date shall be deemed to receive a
         distribution of zero dollars ($0) on such date. If a Participant who
         incurs a forfeiture on account of his incurring a Severance from
         Service Date is re-employed by the Employer prior to incurring five
         consecutive One-Year Periods of Severance, he or she shall have
         restored to his Retirement Account the amount forfeited in accordance
         with the above. Such restored amount shall be invested according to the
         Participant's elections then in effect under Section 7.2. The Committee
         shall maintain, or cause to be maintained, a record of the amounts
         required to be restored hereunder, and the Employer shall pay such
         amounts within thirty (30) days of such notice either from current
         forfeitures or from an additional contribution by the Employer. Any
         forfeiture not restored to a Participant's Retirement Account shall be
         applied to reduce future Retirement Contributions under the Plan.

8.4      Coosa Benefit. Notwithstanding any other provision of the Plan, if a
         Participant's employment with an Employer is terminated, he shall be
         fully vested in his Retirement Account and shall be entitled to receive
         a distribution of the entire amount then in his Retirement Account in
         accordance with Article IX if such Participant meets all of the
         following conditions:

         (a)      immediately prior to his termination of employment he must
                  have been (i) an Employee of Coosa Pines Golf Club Inc., or
                  (ii) an Employee of an Employer located at Coosa Pines,
                  Alabama; and

         (b)      such termination of employment must be involuntary on the part
                  of the Participant and be caused solely by the elimination of
                  his job function from his Employer due to the sale of the
                  assets of the Coosa pulp and newsprint mill facility and
                  woodlands under the Assets Purchase Agreement entered into
                  between the Corporation and Alliance Forest Products, Inc.
                  dated as of February 14, 1997, and such termination of
                  employment must occur on or within 30 days after the Closing
                  Date of such Assets Purchase Agreement.

8.5      K-C Aviation Benefit. Notwithstanding any other provision of the Plan,
         a Participant shall be fully vested in his Accounts as of the date on
         which he ceases to be an Eligible Employee under the Plan, if such
         Participant meets all of the following conditions:

         (a)      immediately prior to the Closing Date, as defined in the
                  Agreement of Purchase and Sale dated as of July 23, 1998 by
                  and between the Corporation and Gulfstream Aerospace
                  Corporation (the "Agreement"), he must have been an Employee
                  employed by the Corporation or K-C Aviation Inc.; and

         (b)      as of the Closing Date, as defined in the Agreement, he must
                  have ceased to be an Eligible Employee solely on account of
                  the sale of the stock of K-C Aviation Inc. pursuant to the
                  Agreement, and he must either (i) be employed by the Buyer, as
                  defined in the Agreement, immediately after he ceases to be an
                  Eligible Employee hereunder, or (ii)

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<PAGE>   26

                  have been on a long-term disability leave of absence from K-C
                  Aviation Inc. as of the Closing Date, as defined in the
                  Agreement.

8.6      Southeast Timberlands Benefit. Notwithstanding any other provision of
         the Plan, if a Participant's employment with an Employer is terminated,
         he shall be fully vested in his Retirement Account and shall be
         entitled to receive a distribution of the entire amount then in his
         Retirement Account in accordance with Article IX if such Participant
         meets all of the following conditions:

         (a)      immediately prior to his termination of employment he must
                  have been (i) an Employee employed with respect to the
                  Southeast Timberlands operations; and

         (b)      such termination of employment must be involuntary on the part
                  of the Participant and be caused solely by the elimination of
                  his job function from his Employer due to the closure or sale
                  of all or a portion of the assets of the Southeast
                  Timberlands, and such termination of employment must occur on
                  or after May 1, 1999.

8.7      Mobile Pulp Mill Benefit. Notwithstanding any other provision of the
         Plan, if a Participant's employment with an Employer is terminated, he
         shall be fully vested in his Retirement Account and shall be entitled
         to receive a distribution of the entire amount then in his Retirement
         Account in accordance with Article IX if such Participant meets all of
         the following conditions:

         (a)      immediately prior to his termination of employment he must
                  have been (i) an Employee employed at the Mobile Pulp Mill;
                  and

         (b)      such termination of employment must be involuntary on the part
                  of the Participant and be caused solely by the elimination of
                  his job function from his Employer due to the shutdown of the
                  Mobile Pulp Mill, and such termination of employment must
                  occur during August or September 1999.

8.8      Durafab-Cleburne Benefit. Notwithstanding any other provision of the
         Plan, if a Participant's employment with an Employer is terminated, he
         shall be fully vested in his Retirement Account and shall be entitled
         to receive a distribution of the entire amount then in his Retirement
         Account in accordance with Article IX if such Participant meets all of
         the following conditions:

         (a)      immediately prior to his termination of employment he must
                  have been (i) an Employee employed at the K-C Apparel Plant of
                  Durafab, Inc. in Cleburne, Texas; and

         (b)      such termination of employment must be involuntary on the part
                  of the Participant and be caused solely by the elimination of
                  his job function from his Employer due to the closure of the
                  K-C Apparel Plant of Durafab, Inc. in Cleburne, Texas, and
                  such termination of employment must occur on or after February
                  1, 2000.

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                                   ARTICLE IX

                          DISTRIBUTIONS AND WITHDRAWALS

9.1      Optional Forms of Distribution. A Terminated Participant may, upon
         Timely Notice elect any one of the following optional forms of
         distribution:

         (a)      All Cash Distribution. An "All Cash Distribution" of a
                  Participant's Retirement Account means a single distribution
                  consisting of the cash equivalent of the Current Market Value
                  on the Valuation Date of the Participant's vested percentage
                  of his Retirement Account.

         (b)      Stock and Cash Distribution. A "Stock and Cash Distribution"
                  of a Participant's Retirement Account means one distribution
                  consisting of:

                  (i)      the cash equivalent of the Current Market Value of
                           the Participant's vested percentage of his Retirement
                           Account, except his interest in the K-C Stock Fund,
                           and

                  (ii)     full shares of Corporation Stock attributable to the
                           Participant's vested percentage interest in the K-C
                           Stock Fund, together with the cash equivalent of the
                           Current Market Value of fractional shares of such
                           Corporation Stock.

         (c)      Installment Distribution. An "Installment Distribution" shall
                  mean the cash equivalent of the Current Market Value of the
                  Participant's vested percentage of his Retirement Account paid
                  monthly in cash for a specified number of years elected by the
                  Participant, not to exceed the lesser of the Participant's
                  life expectancy or 20; provided, however, that an Installment
                  Distribution is available only to Terminated Participants upon
                  attainment of age 55. The value of each payment shall be
                  determined on a declining balance method.

                  Prior to the distribution of the final payment of an
                  Installment Distribution, a Participant may elect:

                  (i)      to receive the remaining balance in his Retirement
                           Account as a Lump Sum Distribution;

                  (ii)     to change the elected period of the Installment
                           Distribution; or

                  (iii)    to receive a Partial Distribution from the remaining
                           balance in his Retirement Account.

9.2      Lump Sum and Partial Distributions. A Lump Sum Distribution or a
         Partial Distribution may be elected by any Participant in the form of
         an All Cash Distribution or a Stock and Cash Distribution.

9.3      Distribution by Reason of Death.

         (a)      A Participant may designate a Beneficiary or Beneficiaries to
                  receive the amount in the Participant's Retirement Account in
                  case of his death, or to receive any balance due to the
                  Participant at the time of his death under Section 9.1(c)
                  above. If a Participant's participation terminates by reason
                  of his death, his Beneficiary shall be entitled to receive
                  distribution in full of the total amount in his Retirement
                  Account. Such distribution shall be in the form of a lump sum
                  payment in cash of the total amount in the Participant's
                  Retirement Account, or at the election of the Beneficiary and
                  in the manner prescribed by the Committee, such distribution
                  may be made in one of the forms specified in Section 9.1
                  above.

         (b)      In case of the Participant's death, the amount in the
                  Participant's Retirement Account shall be distributed in
                  accordance with the Plan to the designated Beneficiary or
                  Beneficiaries. If a married Participant designates a
                  Beneficiary or Beneficiaries other than his surviving spouse
                  at the time of such designation, such designation shall not be
                  effective (and the Participant's spouse shall be the
                  Beneficiary) unless:

                  (ii)     the spouse consents in writing to such designation;

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<PAGE>   28
                  (ii)     the spouse's consent acknowledges the effect of such
                           designation, which consent shall be irrevocable; and

                  (iii)    the spouse executes the consent in the presence of
                           either a Plan representative designated by the
                           Committee or a notary public.

         (c)      Notwithstanding the foregoing, such consent shall not be
                  required if the Participant establishes to the satisfaction of
                  the Committee that such consent cannot be obtained because (i)
                  there is no spouse; (ii) the spouse cannot be located after
                  reasonable efforts have been made; or (iii) other
                  circumstances exist to excuse spousal consent under applicable
                  regulations. Each Beneficiary designation made by a
                  Participant shall at all times satisfy the requirements of
                  this Section 9.2; if at any time such designation shall fail
                  to satisfy the requirements of this Section 9.2, such
                  designation shall thereupon be deemed null and void. A
                  Participant may designate a different Beneficiary provided he
                  or she complies with the spousal consent requirements
                  described above. If the Participant fails to designate a
                  Beneficiary in accordance with the provisions of this Section
                  9.2, or if the designated Beneficiary predeceases the
                  Participant, the total amount in his Retirement Account shall
                  be distributed to the Participant's estate in the form of an
                  All Cash Distribution as soon as practicable after the
                  Participant's death.

9.4      Distribution Upon Termination of Employment for Reasons Other than
         Death. A Participant who is entitled to receive a distribution of his
         Retirement Account due to the termination of his employment for any
         reason except death, may on Timely Notice elect to receive such
         distribution in the form of an All Cash Distribution, a Stock and Cash
         Distribution or, if eligible under Section 9.1(c), an Installment
         Distribution, at any time; provided, however, that no termination of
         employment will be deemed to have occurred in any instance where the
         person involved remains in Service or is re-employed by an Employer
         prior to receiving a distribution of his Retirement Account; provided,
         further, that the distribution provisions of this Article IX shall not
         apply for a Participant or Terminated Participant whose qualified
         domestic relations order is pending approval by the Plan Administrator.

9.5      Small Distributions. Anything to the contrary herein notwithstanding,
         if a Participant's Retirement Account does not exceed $5,000 as
         provided under Code section 411(a)(11) and has never exceeded the
         amount provided under Code section 411(a)(11) at the time of any prior
         distribution (or such amount as the Secretary of Treasury shall
         specify) the Committee shall direct the distribution of the
         Participant's Retirement Account as an All Cash Distribution or Stock
         and Cash Distribution, as elected by the Participant or his
         Beneficiary, following the Participant's Severance from Service Date;
         provided, however, that if no election is made within three months
         after the Participant's Severance from Service Date, such distribution
         shall be in the form of an All Cash Distribution.

9.6      Consent Required. In the case of a Terminated Participant whose vested
         Retirement Account balance exceeds five thousand dollars ($5,000), no
         distribution shall be made (or commence) without the consent of the
         Terminated Participant. If the Terminated Participant does not so
         consent, then distribution will be deferred until the earlier of when a
         Terminated Participant consents to such distribution, or until the
         Participant attains age 65.

9.7      Evidence of Right to Receive Benefit: The Plan Administrator may
         require proper proof of death, paternity, maternity, and such evidence
         of the right of any person to receive a distribution payable as a
         result of the death of a Participant as the Plan Administrator may deem
         desirable. The Plan Administrator's determination of death, paternity,
         maternity and the right of any person to receive payment shall be
         conclusive.

9.8      Required Distributions. Notwithstanding any provision of the Plan to
         the contrary, distribution of a Participant's or Terminated
         Participant's Accounts shall commence no later than the earlier of:

         (a)      April 1 of the calendar year following the later of

                  (i)      the calendar year in which the Terminated Participant
                           attains age 70 1/2, or

                  (ii)     the calendar year in which the Participant retires,
                           as defined under Section 401(a)(9) of the Code, or
                           terminates employment, or

                  with respect to a Participant or Terminated Participant who is
                  a five percent owner as defined in Code Section 401(a)(9),
                  April 1 of the calendar year following the calendar year in
                  which the Participant or Terminated Participant attains age
                  70 1/2.

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<PAGE>   29

         (b)      unless the Participant elects a later date (which can be no
                  later than the date specified in (a) above), the 60th day
                  after the latest of:

                  (i)      the close of the Plan Year in which the Participant
                           attains age 65,

                  (ii)     the close of the Plan Year which includes the date 10
                           years after the date the Participant first commenced
                           participating in the Plan, or

                  (iii)    the close of the Plan Year in which the Participant
                           terminated employment with his Employer.

         (c)      The Accounts of a Participant or Terminated Participant shall
                  be distributed to a Beneficiary who is the surviving spouse,
                  commencing on or before the later of the date on which the
                  Participant or Terminated Participant would have attained age
                  70-1/2 or one year after the date of the Participant's or
                  Terminated Participant's death, or (ii) to a Beneficiary who
                  is not the surviving spouse, within five years of the
                  Participant's or Terminated Participant's death, or, in each
                  case, such other period specified under the requirements of
                  Code section 401(a)(9) and the regulations thereunder.

         (d)      All distributions from the Plan shall be made in accordance
                  with the requirements of Code section 401(a)(9) and the
                  regulations thereunder, including the minimum distribution
                  incidental benefit requirements; provided, however that the
                  Committee may, in its discretion, designate any distribution
                  date which complies with the preceding provisions.

9.9      Direct Rollovers. In the event any payment or payments to be made to a
         Terminated Participant, a Beneficiary who is the surviving spouse of a
         Participant or Terminated Participant, or an Alternate Payee who is the
         former spouse of a Participant or Terminated Participant under the Plan
         would constitute an "eligible rollover distribution," such distributee
         may request that such payment or payments be transferred directly from
         the Trust to the trustee of (a) an individual retirement account
         described in Section 408(a) of the Code, (b) an individual retirement
         annuity described in Section 408(b) of the Code (other than an
         endowment contract), (c) an annuity plan described in Section 403(a) of
         the Code, or (d) a qualified retirement plan the terms of which permit
         the acceptance of rollover distributions; provided, however, that
         clause (c) and (d) shall not apply to an eligible rollover distribution
         made to a Beneficiary who is not the surviving spouse of a Participant
         or Terminated Participant. Any such request shall be made in writing,
         on the form prescribed by the Committee for such purpose, at such time
         in advance as the Committee may specify.

         For purposes of this Section 9.9, an eligible rollover distribution
         shall mean a distribution from the Plan, excluding (a) any distribution
         that is one of a series of substantially equal periodic payments (not
         less frequently than annually) over the life (or life expectancy) of
         the individual, the lives (or life expectancies) of the individual and
         the individual's designated Beneficiary, or a specified period of ten
         (10) or more years, (b) any distribution to the extent such
         distribution is required under Section 401(a)(9) of the Code, (c) any
         distribution to the extent such distribution is not included in gross
         income (determined without regard to the exclusion for net unrealized
         appreciation of Corporation Stock), and (d) any hardship distribution
         described in Section 401(k)(2)(B)(i)(IV) of the Code; it being
         understood that the Plan does not provide for such hardship
         distribution.

9.10     Withdrawals. No withdrawals may be made from a Participant's Retirement
         Account. Notwithstanding the foregoing, a Terminated Participant may,
         by making a request in the manner prescribed by the Committee, withdraw
         all or any portion of the total value of the vested portion of his
         Retirement Account.

9.11     Unclaimed Benefits. During the time when a benefit hereunder is payable
         to any Terminated Participant or, if deceased, his Beneficiary, the
         Committee may mail by registered or certified mail to such Participant
         or Beneficiary, at his last known address, a written demand for his
         then address, or for satisfactory evidence of his continued life, or
         both. If such information is not furnished to the Committee within 12
         months from the mailing of such demand, then the Committee may, under
         rules established by the Committee, in its sole discretion, declare
         such benefit, or any unpaid portion thereof, suspended, with the result
         that such unclaimed benefit shall be treated as a forfeiture for the
         Plan Year within which such 12-month period ends, but shall be subject
         to restoration through and Employer contribution if the lost
         Participant or such Beneficiary later files a claim for such benefits.

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<PAGE>   30

                                    ARTICLE X

                       INCENTIVE INVESTMENT PLAN COMMITTEE

I.       Membership. The Committee shall mean the Salaried Employees Incentive
         Investment Plan Committee, the members of which shall serve at the
         pleasure of the Chief Executive Officer of the Corporation. The
         Committee shall not receive compensation for its services. Committee
         expenses shall be paid by the Corporation.

II.      Powers. The Committee shall have all such powers as may be necessary to
         discharge its duties hereunder, including, but not by way of
         limitation, the power to construe or interpret the Plan, to determine
         all questions of eligibility hereunder, to determine the method of
         payment of any Accounts hereunder, to adopt rules relating to the
         giving of Timely Notice, and to perform such other duties as may from
         time to time be delegated to it by the Chief Executive Officer of the
         Corporation. The Committee may prescribe such forms and systems and
         adopt such rules and actuarial methods and tables as it deems
         advisable. It may employ such agents, attorneys, accountants,
         actuaries, medical advisors, or clerical assistants (none of whom need
         be members of the Committee) as it deems necessary for the effective
         exercise of its duties, and may delegate to such agents any power and
         duties, as it may deem necessary and appropriate.

III.     Procedures. A majority of the Committee members shall constitute a
         quorum. The Committee may take any action upon a majority vote at any
         meeting at which a quorum is present, and may take any action without a
         meeting upon the unanimous written consent of all members. All action
         by the Committee shall be evidenced by a certificate signed by the
         chairman or by the secretary to the Committee. The Committee shall
         appoint a secretary to the Committee who need not be a member of the
         Committee, and all acts and determinations of the Committee shall be
         recorded by the secretary, or under his supervision. All such records,
         together with such other documents as may be necessary for the
         administration of the Plan, shall be preserved in the custody of the
         secretary.

IV.      Rules and Decisions. All rules and decisions of the Committee shall be
         uniformly and consistently applied to all Eligible Employees and
         Participants under this Plan in similar circumstances and shall be
         conclusive and binding upon all persons affected by them. The Committee
         shall have absolute discretion in carrying out its duties under the
         Plan.

V.       Authorization of Payments. Subject to the provisions hereof, it shall
         be the duty of the Committee to furnish the Trustee with all facts and
         directions necessary or pertinent to the proper disbursement of the
         Trust funds.

VI.      Books and Records. The records of the Employers shall be conclusive
         evidence as to all information contained therein with respect to the
         basis for participation in the Plan and for the calculation of
         Retirement Contributions.

VII.     Perpetuation of the Committee. In the event that the Corporation shall
         for any reason cease to exist, then, unless the Plan is adopted and
         continued by a successor, the members of the Committee at that time
         shall remain in office until the final termination of the Trust, and
         any vacancies in the membership of the Committee caused by death,
         resignation, disability or other cause, shall be filled by the
         remaining member or members of the Committee.

VIII.    Claim Procedure. The Committee shall establish a procedure for handling
         all claims by all persons. In the event any claim is denied, the
         Committee shall provide a written explanation to the person stating the
         reasons for denial.

IX.      Allocation or Reallocation of Fiduciary Responsibilities. The Named
         Fiduciary may allocate powers and responsibilities not specifically
         allocated by the Plan, or reallocate powers and responsibilities
         specifically allocated by the Plan, to designated persons, partnerships
         or corporations other than the Committee, and the members of the
         Committee may allocate their responsibilities under the Plan among
         themselves. Any such allocation, reallocation, or designation shall be
         in writing and shall be filed with and retained by the secretary of the
         Committee with the records of the Committee. Notwithstanding the
         foregoing, no reallocation of the responsibilities provided in the
         Trust to manage or control the Trust assets shall be made other than by
         an amendment to the Trust.

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<PAGE>   31

X.       Plan Administrator. The Corporation shall be the Plan Administrator as
         described in ERISA.

XI.      Service of Process. The Corporation shall be the designated recipient
         of service of process with respect to legal actions regarding the Plan.

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                                   ARTICLE XI

                            AMENDMENT AND TERMINATION

11.1     Amendment and Termination. While it is intended that the Plan shall
         continue in effect indefinitely, the Board may from time to time
         modify, alter or amend the Plan or the Trust, and may at any time order
         the temporary suspension or complete discontinuance of Retirement
         Contributions or may terminate the Plan, provided, however, that

         (a)      no such action shall make it possible for any part of the
                  Trust assets (except such part as is used for the payment of
                  expenses) to be used for or diverted to any purpose other than
                  for the exclusive benefit of Participants or their
                  Beneficiaries;

         (b)      no such action shall adversely affect the rights or interests
                  of Participants theretofore vested under the Plan; and

         (c)      in the event of termination of the Plan or complete
                  discontinuance of Retirement Contributions hereunder, all
                  rights and interests of Participants not theretofore vested
                  shall become vested as of the date of such termination or
                  complete discontinuance.

         Any action permitted to be taken by the Board under the foregoing
         provision regarding the modification, alteration or amendment of the
         Plan or the Trust may be taken by the Committee, using its prescribed
         procedures, if such action

         (a)      is required by law,

         (b)      is estimated not to increase the annual cost of the Plan by
                  more than $1,000,000, or

         (c)      is estimated not to increase the annual cost of the Plan by
                  more than $25,000,000, provided such action is approved and
                  duly executed by the Chief Executive Officer of the
                  Corporation.

         Any action taken by the Board or Committee shall be made by or pursuant
         to a resolution duly adopted by the Board or Committee and shall be
         evidenced by such resolution or by a written instrument executed by
         such persons as the Board or Committee shall authorize for such
         purpose.

         The Committee shall report to the Chief Executive Officer of the
         Corporation before January 31 of each year all action taken by it
         hereunder during the preceding calendar year.

         However, nothing herein shall be construed to prevent any modification,
         alteration or amendment of the Plan or of the Trust which is required
         in order to comply with any law relating to the establishment or
         maintenance of the Plan and Trust, including but not limited to the
         establishment and maintenance of the Plan or Trust as a qualified
         employee plan or trust under the Code, even though such modification,
         alteration, or amendment is made retroactively or adversely affects the
         rights or interests of a Participant under the Plan.

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                                   ARTICLE XII

                                  MISCELLANEOUS

I.       Non-Guarantee of Employment. Nothing contained in this Plan shall be
         construed as a contract of employment between an Employer and a
         Participant, or as a right of any Participant to be continued in the
         employment of his Employer, or as a limitation of the right of an
         Employer to discharge any Participant with or without cause.

II.      Rights to Trust Assets. No Participant or any other person shall have
         any right to, or interest in, any part of the Trust assets upon
         termination of his employment or otherwise, except as provided from
         time to time under this Plan, and then only to the extent of the
         amounts due and payable to such person out of the assets of the Trust.
         All payments as provided for in this Plan shall be made solely out of
         the assets of the Trust and neither the Employers, the Trustee, nor any
         member of the Committee or the Named Fiduciary shall be liable therefor
         in any manner.

         The Employers shall have no beneficial interest of any nature
         whatsoever in any Employer Contributions after the same have been
         received by the Trustee, or in the assets, income or profits of the
         Trust, or any part thereof, except to the extent that forfeitures as
         provided in the Plan shall be applied to reduce the Employer
         Contributions.

III.     Disclaimer of Liability. Neither the Trustee, the Employers, nor any
         member of the Committee or the Named Fiduciary shall be held or deemed
         in any manner to guarantee the funds of the Trust against loss or
         depreciation.

IV.      Non-Recommendation of Investment. The availability of any security
         hereunder shall not be construed as a recommendation to invest in such
         security. The decision as to the choice of investment of Retirement
         Contributions must be made solely by each Participant, and no officer
         or employee of the Corporation or the Trustee is authorized to make any
         recommendation to any Participant concerning the allocation of
         Retirement Contributions hereunder.

V.       Indemnification of Committee. The Employers shall indemnify the
         Committee and the Named Fiduciary and each member thereof and hold them
         harmless from the consequences of their acts or conduct in their
         official capacity, including payment for all reasonable legal expenses
         and court costs, except to the extent that such consequences are the
         result of their own willful misconduct or breach of good faith.

VI.      Non-Alienation. Except as otherwise provided herein, no right or
         interest of any Participant or Beneficiary in the Plan and the Trust
         shall be subject in any manner to anticipation, alienation, sale,
         transfer, assignment, pledge, encumbrance, charge, attachment,
         garnishment, execution, levy, bankruptcy, or any other disposition of
         any kind, either voluntary or involuntary, prior to actual receipt of
         payment by the person entitled to such right or interest under the
         provisions hereof, and any such disposition or attempted disposition
         shall be void.

VII.     Facility of Payment. If the Committee has notice that a Participant
         entitled to a distribution hereunder, or his Beneficiary, is incapable
         of caring for his own affairs, because of illness or otherwise, the
         Committee may direct that any distribution from such Participant's
         Retirement Account may be made, in such shares as the Committee shall
         determine, to the spouse, child, parent or other blood relative of such
         Participant, or his Beneficiary, or any of them, or to such other
         person or persons as the Committee may determine, until such date as
         the Committee shall determine that such incapacity no longer exists.
         The Committee shall be under no obligation to see to the proper
         application of the distributions so made to such person or persons, and
         any such distribution shall be a complete discharge of any liability
         under the Plan to such Participant, or his Beneficiary, to the extent
         of such distribution.

VIII.    Action by a Committee of the Board. Any action which is required or
         permitted to be taken by the Board under the Plan may be taken by the
         Compensation Committee of the Board or any other duly authorized
         committee of the Board designated under the By-Laws of the Corporation.

                                      195
<PAGE>   34

IX.      Qualified Domestic Relations Orders. Anything in this Plan to the
         contrary notwithstanding:

         A.       Alternate Payee's Account. An alternate payee under a domestic
                  relations order determined by the Corporation to be a
                  qualified domestic relations order (as defined in Code section
                  414(p)) shall have established and maintained for him a
                  separate Retirement Account similar to the Retirement Account
                  of the Participant specified in the qualified domestic
                  relations order. The alternate payee's Retirement Accounts
                  shall be credited with his interest in such Participant's
                  Retirement Accounts, as determined under the qualified
                  domestic relations order.

         B.       Investment of Alternate Payee's Account. Unless a Qualified
                  Domestic Relations Order provides to the contrary, an
                  Alternate Payee shall have the right to direct the investment
                  of any portion of a Participant's Retirement Account payable
                  to the Alternate Payee under such order in the same manner as
                  provided in this Article VII with respect to a Participant,
                  which amounts shall be separately accounted for by the Trustee
                  in the Alternate Payee's name.

         C.       Alternate Payee's Beneficiary. Except to the extent otherwise
                  provided by the Qualified Domestic Relations Order relating to
                  an Alternate Payee:

                  1.       the Alternate Payee may designate on Timely Notice a
                           beneficiary, and

                  2.       the beneficiary of the Alternate Payee shall be
                           accorded under the Plan all the rights and privileges
                           of the Beneficiary of a Participant in the same
                           manner as provided in Section 9.1 (except that no
                           spousal consent shall be required). If the Alternate
                           Payee does not designate a Beneficiary, or if the
                           Beneficiary predeceases the Alternate Payee, benefits
                           payable to the Alternate Payee which have not been
                           distributed shall be paid to the Alternate Payee's
                           estate.

         D.       Distribution to Alternate Payee. An alternate payee shall be
                  entitled to receive a distribution from the Plan in accordance
                  with the Qualified Domestic Relations Order relating to the
                  Alternate Payee. Such distribution may be made only in a
                  method provided in Article IX and shall include only such
                  amounts as have become vested; provided, however, that if a
                  Qualified Domestic Relations Order so provides, a distribution
                  of the total vested amount awarded to the Alternate Payee may
                  be made to the Alternate Payee before the date that the
                  Participant specified in the Qualified Domestic Relations
                  Order attains his earliest retirement age (as defined in Code
                  section 414(p)(4)(B)). An Alternate Payee shall be eligible
                  for an Installment Distribution under Section 9.1(c) only if
                  the Participant is eligible for such distribution.

         E.       Vesting of Alternate Payee's Account. In the event that the
                  Qualified Domestic Relations Order provides for all or part of
                  the non-vested portion of the Participant's Retirement Account
                  to be credited to the account of the Alternate Payee, such
                  amounts shall vest and/or be forfeited at the same time and in
                  the same manner as the Retirement Account of the Participant
                  specified in the Qualified Domestic Relations Order; provided,
                  however, that no forfeiture shall result to the account of the
                  Alternate Payee due to any distribution to or withdrawal by
                  the Participant from his Retirement Account or any
                  distribution to or withdrawal by the Alternate Payee from the
                  vested portion of the account of the Alternate Payee.

X.       Compensation Limit. In addition to other applicable limitations which
         may be set forth in the Plan and notwithstanding any other contrary
         provision of the Plan, compensation taken into account under the Plan
         shall not exceed $150,000, adjusted for changes in the cost of living
         as provided in Code sections 401(a)(17)(B) and 415(d).

                                      196
<PAGE>   35

                                  ARTICLE XIII

                                     MERGER

No merger or consolidation with or transfer of any assets or liabilities to any
other plan shall be made unless, upon completion thereof, the value of each
Participant's Retirement Account shall immediately after said merger,
consolidation, or transfer be equal to or greater than the value of the
Participant's Retirement Account immediately before the merger, consolidation,
or transfer (if the Plan had then terminated).

                                      197
<PAGE>   36

                                   ARTICLE XIV

                             TOP-HEAVY REQUIREMENTS

14.1     Top-Heavy Requirements. Notwithstanding any other provisions of this
         Plan, the following rules shall apply for any Plan Year if as of the
         last day of the preceding Plan Year or, in the case of the first Plan
         Year, the last day of such Plan Year, based on valuations as of such
         date, the sum of the present value of accrued benefits and Accounts of
         "key employees" (within the meaning of Code section 416) exceeds 60% of
         a similar sum for all employees under (i) each plan of the Employer or
         any Affiliated Employer in which a "key employee" participates, (ii)
         each other plan of the Employer or any Affiliated Employer which
         enables any such plan to meet the requirements of Code section
         401(a)(4) or 410 and (iii) each other plan of the Employer or any
         Affiliated Employer which, if aggregated with the plan described in (i)
         and (ii), would not cause any such plan described in this clause (iii)
         to fail to satisfy the requirements of Code Sections 401(a)(4) or 410.
         A Plan Year during which such rules apply shall be known as a
         "Top-Heavy Plan Year."

                  (a)      Vesting. A Participant who is credited with an Hour
                           of Service during the Top-Heavy Plan Year, or in any
                           Plan Year after the Top-Heavy Plan Year, and who has
                           completed at least three years of Service shall have
                           a nonforfeitable right to 100% of his Retirement
                           Account and no such amount may become forfeitable if
                           the Plan later ceases to be Top-Heavy nor may such
                           amount be forfeited under the provisions of Code
                           sections 411(a)(3)(B) (relating to suspension of
                           benefits upon reemployment) or 411(a)(3)(D) (relating
                           to forfeitures upon withdrawal of mandatory
                           contributions). If the Plan become Top-Heavy and
                           later ceases to be Top-Heavy, this vesting schedule
                           shall no longer apply and benefits which have not at
                           such time vested under this schedule shall vest only
                           in accordance with other provisions of this Plan,
                           provided that any Participant with at least 3 years
                           of Service shall be entitled to continue to utilize
                           this schedule for vesting purposes by making an
                           election at the time and in the manner specified by
                           the Committee.

                  (b)      Required Contributions. Each Employer shall
                           contribute on behalf of each employee eligible to
                           participate in the Plan, the lesser of:

                           (i)  3% of such employee's compensation (within the
                                meaning of Code section 415); or

                           (ii) the percentage of such employee's compensation
                                (within the meaning of Code section 415) which
                                is equal to the percentage at which
                                contributions were made for that Plan Year on
                                behalf of the "key employee" for whom such
                                percentage is the greatest for such Plan Year,
                                as prescribed by Code section 416(c)(2)(B) and
                                regulations thereunder.

                           Any contribution made pursuant to this subsection
                  14.1(b) shall be allocated to the Retirement Account on behalf
                  of the employee for whom such contribution is made.

         (c)      Additional Limitations. No allocations may be made to the
                  Account of a Participant the sum of whose defined benefit plan
                  fraction and defined contribution plan fraction, as defined in
                  Code section 415(e), exceeds 1.0 when the dollar amounts, as
                  defined in Section 12.2(b) hereof, are multiplied by 1.0
                  rather than 1.25.

                           The provisions of this Section 14.1 shall be
                  interpreted in accordance with the provisions of Code section
                  416 and any regulations thereunder, which are hereby expressly
                  incorporated by reference.

         (d)      Coordination. In the event a top heavy minimum contribution or
                  benefit is required under this Plan or a defined benefit plan
                  of an Employer that covers a Participant, the top heavy
                  minimum contribution or benefit, as appropriate, shall be
                  provided in this Plan. In the event a top heavy minimum
                  contribution is required under this Plan or another defined
                  contribution plan of an Employer that covers a Participant,
                  the top heavy minimum contribution shall be provided in this
                  Plan.

                                      198
<PAGE>   37

                                   APPENDIX A

                     LIST OF EMPLOYERS, PARTICIPATING UNITS
                      AND EFFECTIVE DATES OF PARTICIPATION

<TABLE>
<CAPTION>
Employers                                   Participating Units                          Effective Date
---------                                   -------------------                          --------------
<S>                                         <C>                                          <C>
Kimberly-Clark Corporation                  All salaried employees*                      January 1, 1997

                                            All hourly employees* at the Beech
                                            Island Mill, Berkeley Mill, and New
                                            Milford Mill.

                                            All hourly organized employees at            September 1, 2000
                                            the Kimtech Machinists Unit and the
                                            Kimtech Machinery Installation Unit
                                            who are represented by Lodge 1855 of
                                            the International Association of
                                            Machinists and Aerospace Workers,
                                            AFL-CIO*

                                            All salaried employees and hourly            January 1, 1997
                                            employees of Sani-Fresh
                                            International division located at
                                            San Antonio, Texas.*

                                            All hourly organized employees at            January 1, 1998
                                            the Mobile Operations who are
                                            represented by the United
                                            Paperworkers Union, Local Nos. 423,
                                            1421, 1575 and 1873, or the
                                            International Brotherhood of
                                            Electrical Workers, Local No. 2129*

                                            All hourly organized employees at            September 6, 1998
                                            the Chester Mill who are represented
                                            by the United Paperworkers Union,
                                            Local 448.*

                                            All hourly organized employees at            September 1, 2000
                                            the Everett Mill who are represented
                                            by the Association of Western Pulp
                                            and Paper Workers, Local Nos. 183
                                            and 644*

                                            All hourly organized employees at            September 1, 2000
                                            the Marinette Mill who are
                                            represented by the United
                                            Paperworkers International Union,
                                            Local No. 86

*Including those on temporary assignment at other Employers or in other classifications, but excluding employees on temporary
assignment
</TABLE>

                                      199<PAGE>   1
                                                                  EXHIBIT 4.1

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

                           FIRST AMENDED AND RESTATED

                                RIGHTS AGREEMENT

                                     BETWEEN

                            ARKANSAS BEST CORPORATION

                                       AND

                      COMPUTERSHARE INVESTOR SERVICES, LLC
                                       AS
                                  RIGHTS AGENT

                             DATED AS OF MAY 1, 2001

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

<PAGE>   2

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                             PAGE
                                                                                                             ----
<S>               <C>                                                                                        <C>
Section 1.        Certain Definitions.......................................................................   2

Section 2.        Appointment of Rights Agent...............................................................   7

Section 3.        Issue of Right Certificates...............................................................   7

Section 4.        Form of Right Certificates................................................................   9

Section 5.        Countersignature and Registration.........................................................   9

Section 6.        Transfer, Split-up, Combination, and Exchange
                      or Right Certificates; Mutilated, Destroyed,
                      Lost or Stolen Right Certificates.....................................................  10

Section 7.        Exercise of Rights; Purchase Price;
                      Expiration Date of Rights.............................................................  10

Section 8.        Cancellation and Destruction of Right Certificates........................................  12

Section 9.        Reservation and Availability of Common Shares.............................................  12

Section 10.       Common Shares Record Date.................................................................  13

Section 11.       Adjustment of Purchase Price, Number of Shares or
                      Number of Rights......................................................................  13

Section 12.       Certificate of Adjusted Purchase Price or Number of Shares................................  17

Section 13.       Consolidation, Merger or Sale or Transfer of Assets
                      or Earning Power......................................................................  18

Section 14.       Fractional Rights and Fractional Shares...................................................  20

Section 15.       Rights of Action..........................................................................  21

Section 16.       Agreement of Right Holders................................................................  21

Section 17.       Right Certificate Holder Not Deemed a Stockholder.........................................  22

Section 18.       Concerning the Rights Agent...............................................................  22

Section 19.       Merger, Consolidation or Change of Name of Rights Agent...................................  23
</TABLE>

                                       -i-

<PAGE>   3

<TABLE>
<S>               <C>                                                                                        <C>
Section 20.       Duties of Rights Agent....................................................................  23

Section 21.       Change of Rights Agent....................................................................  25

Section 22.       Issuance of New Right Certificates........................................................  26

Section 23.       Redemption................................................................................  26

Section 24.       Notice of Certain Events..................................................................  27

Section 25.       Notices...................................................................................  28

Section 26.       Supplements and Amendments................................................................  28

Section 27.       Successor.................................................................................  29

Section 28.       Benefits of this Agreement................................................................  29

Section 29.       Severability..............................................................................  29

Section 30.       Governing Law.............................................................................  29

Section 31.       Counterparts..............................................................................  29

Section 32.       Descriptive Headings......................................................................  29

Section 33.       Establishment of Fund for Directors.......................................................  29

Section 34.       Exchange..................................................................................  30

                  Signatures................................................................................  32
</TABLE>

Exhibit A - Form of Right Certificate

Exhibit B - Summary of Rights

                                      -ii-
<PAGE>   4

                                RIGHTS AGREEMENT

         FIRST AMENDED AND RESTATED RIGHTS AGREEMENT, dated as of May 1, 2001
(the "Agreement"), by and between Arkansas Best Corporation, a Delaware
corporation (the "Company"), and Computershare Investor Services, LLC, a
Delaware limited liability company (the "Rights Agent").

                                     RECITAL

         WHEREAS, the Company and Harris Trust and Savings Bank (the "Initial
Rights Agent"), entered into a Rights Agreement dated as of April 23, 1992 and
an Amendment to Rights Agreement dated as of May 27, 1999 (as amended, the
"Rights Agreement");

         WHEREAS, the Rights Agent has been appointed by the Company to succeed
the Initial Rights Agent under the Rights Agreement;

         WHEREAS, the Board of Directors of the Company authorized the issuance
of one common share purchase right (a "Right") for each Common Share (as defined
below) of the Company issued and outstanding on the closing date of the
Company's initial public offering (the "Record Date"), each Right representing
the right to purchase one Common Share, upon the terms and subject to the
conditions set forth in the Rights Agreement, and has further authorized and
directed the issuance of one Right with respect to each Common Share that
becomes outstanding between the Record Date (whether originally issued or
delivered from the Company's treasury) and the earliest of the Distribution
Date, the Redemption Date and the Final Expiration Date (as such terms are
defined below).

         WHEREAS, Section 26 of the Rights Agreement permits the amendment of
the Rights Agreement by the Board of Directors of the Company;

         WHEREAS, pursuant to a resolution duly adopted on April 25, 2001, the
Board of Directors of the Company has adopted and authorized the amendment of
the Rights Agreement so that, among other things, the Rights Agreement will be
extended until April 30, 2011 and the "Purchase Price" will be increased to
$80.00 per Common Share;

         WHEREAS, the Board of Directors of the Company has resolved and
determined that such amendment is desirable and consistent with, and for the
purpose of fulfilling, the objectives of the Board of Directors in connection
with the original adoption of the Rights Agreement;

         THEREFORE, in consideration of the foregoing and the mutual agreements
set forth below, the parties to this Rights Agreement hereby agree to amend and
restate this Rights Agreement in its entirety as follows:

                                      -1-
<PAGE>   5

         SECTION 1. CERTAIN DEFINITIONS.

         For purposes of this Agreement, the following terms have the indicated
meanings:

         (a) "Acquiring Person" means any Person that, together with all
Affiliates and Associates of such Person, shall be the Beneficial Owner of 15%
or more of the Common Shares then outstanding. The term "Acquiring Person" shall
not include the Company, any Subsidiary of the Company or any Person who
acquires beneficial ownership of the Common Shares in a Permitted Transaction,
any employee benefit plan of the Company or any Subsidiary of the Company or any
Person holding Common Shares for or pursuant to the terms of any such plan.
Notwithstanding the foregoing, if, upon Board Approval, the Company determines
in good faith that a Person who would otherwise be an "Acquiring Person," as
defined pursuant to the foregoing provisions of this paragraph has become such
inadvertently, and such Person divests as promptly as practicable a sufficient
number of Common Shares so that such Person would no longer be an Acquiring
Person, as defined pursuant to the foregoing provisions of this paragraph, then
such Person shall not be deemed to be an "Acquiring Person" for any purposes of
this Agreement.

         (b) "Affiliate" and "Associate" have the respective meanings ascribed
to such terms in Rule 12b-2 of the General Rules and Regulations under the
Exchange Act in effect on the date of this Agreement.

         (c) A Person will be deemed the "Beneficial Owner" of and shall be
deemed to "beneficially own" any securities:

                  (i) that such Person or any of such Person's Affiliates or
         Associates beneficially owns, directly or indirectly in accordance with
         the regulations under the Exchange Act in effect on the date of this
         Agreement;

                  (ii) that such Person or any of such Person's Affiliates or
         Associates has (A) the right to acquire (whether such right is
         exercisable immediately or only after the passage of time or the
         occurrence of any events or conditions) pursuant to any written or oral
         agreement, arrangement or understanding (other than the ownership by
         underwriters or selling group members under customary agreements with
         respect to a bona fide public offering of securities), or upon the
         exercise of conversion rights, exchange rights, rights (other than
         these Rights), warrants, options or otherwise; provided, however, that
         a Person will not be deemed the Beneficial Owner of, or to beneficially
         own, any security tendered pursuant to a tender or exchange offer made
         by or on behalf of such Person or any of such Person's Affiliates or
         Associates until such tendered securities are accepted for purchase or
         exchange; (B) the right to vote or direct or influence the voting of
         any other Person or such other Person's Affiliates or Associates
         pursuant to any written or oral agreement, arrangement or
         understanding; provided, however, that a Person will not be deemed the
         Beneficial Owner of, or to beneficially own, any security if the
         agreement, arrangement or understanding to vote such security (1)
         arises solely from a revocable proxy or consent given to such Person in
         response to a public proxy or consent solicitation made pursuant to,
         and in accordance with, the applicable rules and regulations

                                      -2-
<PAGE>   6

         of the Exchange Act and (2) is not also then reportable on Schedule 13D
         under the Exchange Act (or any comparable or successor report); or (C)
         "beneficial ownership" (as determined pursuant to Rule 13d-3 of the
         General Rules and Regulations under the Exchange Act); or

                  (iii) that are beneficially owned, directly or indirectly, by
         any other Person with which such Person or any of such Person's
         Affiliates or Associates has any written or oral agreement, arrangement
         or understanding (other than the ownership by underwriters or selling
         group members under customary agreements with respect to a bone fide
         public offering of securities) for the purpose of acquiring, holding,
         voting (except to the extent contemplated by the proviso to clause (B)
         of subparagraph (ii) of this definition) or disposing of any such
         securities.

         (d) "Board Approval" means that an action or the resolution authorizing
an action has been approved by a majority of the members of the Board of
Directors of the Company.

         (e) "Business Day" means any day other than a Saturday, a Sunday or a
day on which the Rights Agent is authorized or obligated by law or executive
order to close.

         (f) "Close of Business" on any given date means 5:00 p.m., Central
time, on such date; provided, however, that if such date is not a Business Day
it means 5:00 p.m., Central time, on the next succeeding Business Day.

         (g) "Common Shares" when used with reference to the Company means the
shares of common stock, par value $0.01 per share, of the Company. "Common
Shares" when used with reference to any Person other than the Company means the
capital stock (or equity interest) with the greatest voting power of such other
Person or, if such other Person is a Subsidiary of another Person, the capital
stock (or equity interest) with the greatest voting power of the Person or
Persons which ultimately control such first-mentioned Person, or the equity
securities or other equity interest having power to control or direct the
management of such other Person.

         (h) The "current per share market price" of any security (a "Security"
for the purpose of this definition) on any date for the purpose of any
computation under this Agreement, will be deemed to be the average of the daily
closing prices per share of such Security for the thirty (30) consecutive
Trading Days immediately prior to such date; provided, however, that in the
event that the current per share market price of the Security is determined
during a period following (A) the announcement by the issuer of such Security of
(i) a dividend or distribution on such Security payable in shares of such
Security or securities convertible, directly or indirectly, into shares of such
Security or (ii) any subdivision, combination or reclassification of such
Security and (B) prior to the expiration of thirty (30) Trading Days after the
ex-dividend date for such dividend or distribution, or the record date for such
subdivision, combination or reclassification, then, and in each such case, the
current per share market price will be appropriately adjusted to reflect the
current market price per share equivalent of such Security. The closing price
for each day will be the last sale price, regular way, or, in case no such sale
takes place on such day, the average of the closing bid and asked prices,
regular way, in either case as reported in the principal consolidated
transaction reporting system with respect to securities listed or admitted to
trading on the New York Stock Exchange or, if the Security is not listed or
admitted to

                                      -3-
<PAGE>   7

trading on the New York Stock Exchange, as reported in the principal
consolidated transaction reporting system with respect to securities listed on
the principal national securities exchange on which the Security is listed or
admitted to trading or, if the Security is not listed or admitted to trading on
any national securities exchange, the last quoted price or, if not so quoted,
the average of the high bid and low asked prices in the over-the-counter market,
as reported by NASDAQ or such other system then in use, or, if on any such date
the Security is not quoted by any such organization, the average of the closing
bid and asked prices as furnished by a professional market maker making a market
in the Security selected by the Board of Directors of the Company.

         (i) "Distribution Date" means the earliest to occur of (i) the Close of
Business on the tenth (10th) day after the Stock Acquisition Date, (ii) the
Close of Business on the fifteenth (15th) business day (or such later date as
may be determined by Board Approval prior to such time as any Person becomes an
Acquiring Person) following the date any Person commences or publicly announces
an intention to commence a tender offer or exchange offer for the Common Shares
which would result in, upon the consummation of such offer, the Person making
such offer, together with all of its Affiliates and Associates, being the
Beneficial Owner of 19.9% or more of the Common Shares then outstanding
(including any such date that is after the date of this Agreement and prior to
the issuance of the Rights); provided, however, that if the tender offer or
exchange offer that gave rise to the Distribution Date is cancelled, terminated
or otherwise withdrawn within ten (10) days of its announcement, such offer
shall be deemed never to have been made and no Distribution Date shall occur
with respect thereto or (iii) the Close of Business on the tenth day after a
Person has become an Adverse Person.

         (j) "Equivalent Common Shares" means any shares of the Company's
capital stock having substantially the same rights, privileges and preferences
as the Common Shares.

         (k) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

         (l) "Final Expiration Date" means the Close of Business on April
30, 2011.

         (m) "NASDAQ" means the National Association of Securities Dealers, Inc.
Automated Quotations System.

         (n) "Permitted Transaction" means a stock acquisition (including
acquisition by merger) or a tender or exchange offer pursuant to a definitive
agreement by which a Person (who is not at the time an Acquiring Person) would
become the Beneficial Owner of 50% or more of the Common Shares and which has
received Board Approval prior to the execution of the definitive agreement
providing for the acquisition or the public announcement of the offer, as the
case may be.

         (o) "Person" means any individual, firm, corporation, partnership,
trust or other entity, and includes any successor (by merger or otherwise) of
such Person.

                                      -4-
<PAGE>   8

         (p) "Purchase Price" means $80.00 per Common Share, subject to
adjustment as provided in this Agreement.

         (q) "Record Date" has the meaning set forth in the preamble to this
Agreement.

         (r) "Redemption Date" means the Close of Business on the date at which
the Rights are redeemed as provided in Section 23 of this Agreement.

         (s) "Redemption Price" means, initially, $0.01 per Right; provided that
the Redemption Price shall be appropriately adjusted to reflect any stock split,
stock dividend or similar transaction occurring after the date of this
Agreement.

         (t) "Right" has the meaning set forth in the preamble to this
Agreement.

         (u) "Right Certificate" means a certificate in substantially the form
of Exhibit A to this Agreement issued after the Distribution Date in accordance
with Section 3 of this Agreement.

         (v) "Rights Agent" has the meaning set forth in the preamble to this
Agreement.

         (w) "Securities Act" means the Securities Act of 1933, as amended.

         (x) "Stock Acquisition Date" means the first date of a public
announcement by the Company or an Acquiring Person that an Acquiring Person has
become such.

         (y) "Subsidiary" of any Person means any Person of which a majority of
the voting power of the voting equity securities or equity interest is owned or
controlled, directly or indirectly, by such Person.

         (z) "Summary of Rights" means a summary of the terms of the Rights; for
all times after the date of this Agreement, the "Summary of Rights" shall be in
substantially the form of Exhibit B to this Agreement.

         (aa) "Trading Day" means a day on which the principal national
securities exchange on which a security is listed or admitted to trading is open
for the transaction of business or, if a security is not listed or admitted to
trading on any national securities exchange, a Business Day.

         (bb) "Trigger Event" means one or more of the following:

                  (i) any Acquiring Person or Adverse Person or any Associate or
         Affiliate of any Acquiring Person or Adverse Person shall directly or
         indirectly, other than pursuant to any transaction set forth in Section
         13(a), hereof, (A) consolidate with or merge with and into the Company
         or otherwise combine with the Company and the Company shall be the
         continuing or surviving corporation of such merger or combination and
         the Common Shares of the Company shall remain outstanding and
         unchanged; (B) in one or more transactions transfer any assets to the
         Company in exchange (in whole or in part)

                                      -5-
<PAGE>   9

         for shares of any Voting Stock of the Company or for securities
         exercisable for or convertible, directly or indirectly, into shares of
         Voting Stock of the Company or otherwise obtain from the Company, with
         or without consideration, any additional shares of any Voting Stock of
         the Company or securities, rights or warrants exercisable for or
         convertible, directly or indirectly, into shares of any Voting Stock of
         the Company (other than in connection with (1) the exercise of a Right
         or Rights, (2) the exercise or conversion of securities exercisable for
         or convertible into Voting Stock of the company which securities were
         outstanding prior to the time the Acquiring Person or Adverse Person
         became such and (3) a pro rata distribution to all holders of any class
         of capital stock of the Company or of its Subsidiaries); (C) shall
         sell, purchase, lease, exchange, mortgage, pledge, transfer or
         otherwise acquire (other than as a pro rata dividend) or dispose, in
         one transaction or a series of transactions, to, from or with, as the
         case may be, the Company or any of its Subsidiaries, assets (including
         securities) on terms and conditions less favorable to the Company or
         such Subsidiary than the Company or such Subsidiary would be able to
         obtain in arm's-length negotiation with an unaffiliated third party;
         (D) shall receive any compensation from the Company or any of the
         Company's Subsidiaries other than compensation for full-time employment
         as a regular or part time employee, or fees for serving as a director,
         at rates in accordance with the Company's (or its Subsidiaries') past
         practices; (E) shall sell, purchase, lease, exchange, mortgage, pledge,
         transfer or otherwise acquire (other than as a pro rata dividend) or
         dispose, in one transaction or a series of transactions, to, from or
         with, as the case may be, the Company or any of its Subsidiaries (other
         than in connection with the lines of business, if any, engaged in
         between the Company and the Acquiring Person or Adverse Person or
         Associate or Affiliate thereof prior to the time the Acquiring Person
         or Adverse Person became such) assets having an aggregate fair market
         value of more than $10,000,000; or (F) receive the benefit, directly or
         indirectly (except proportionately as a stockholder and except if
         resulting from a requirement of law or governmental regulation), of any
         loans, advances, guarantees, pledges or other financial assistance or
         any tax credits or other tax advantages provided by the Company or any
         of its Subsidiaries;

                  (ii) any Person (other than the Company, any of its
         Subsidiaries, any employee benefit plan of the Company or its
         Subsidiaries or any entity organized, appointed or established pursuant
         to the terms of such plan), alone or together with its Affiliates and
         Associates, shall beneficially own 19.9% or more of the Common Shares
         then outstanding (unless each acquisition of Common Shares which
         results in the beneficial ownership of such Person equaling or
         exceeding 19.9% of the Common Shares is a Permitted Transaction or is a
         transaction set forth in Section 13(a) hereof);

                  (iii) any reclassification of securities (including any
         reverse stock split), or recapitalization of the Company, or any merger
         or consolidation of the Company with any of its Subsidiaries or any
         other transaction or series of transactions involving the Company or
         any of its Subsidiaries which is not effected with the concurrence of a
         majority of the Board of Directors, other than a transaction or
         transactions to which the provisions of Section 13(a) apply (whether or
         not with or into or otherwise involving an Acquiring Person or Adverse
         Person or any of its Affiliates or Associates) which has the effect,
         directly or indirectly, of increasing by more than 1% the proportionate
         share of

                                      -6-
<PAGE>   10

         any class of outstanding Voting Stock of the Company or any of its
         Subsidiaries which is beneficially owned by any Acquiring Person or
         Adverse Person and its Affiliates and Associates; or

                  (iv) the Board of Directors declares any Person to be an
         Adverse Person.

         (cc) "Voting Stock" shall mean (i) the Common Shares and (ii) any other
shares of capital stock of the Company entitled to vote generally in the
election of directors or entitled to vote together with the Common Shares in
respect of any merger, consolidation, sale of all or substantially all of the
Company's assets, liquidation, dissolution or winding up.

         (dd) "Adverse Person" means a Person (alone or together with any other
Persons) as to which the Board of Directors has, after consultation with such
advisors and such other investigation as it considers necessary, made the
following determinations: (i) such Person or Persons any time after May 1, 2001
have become the Beneficial Owner of a substantial (but in no event less than 10%
of the Common Shares then outstanding) amount of Common Shares; and (ii) (A)
such Person or Persons intend to cause the Company or its Affiliates to
repurchase such Common Shares beneficially owned by such Person or Persons or to
exert pressure against the Company to take any action (or series of actions) or
enter into any transaction (or series of transactions) with the intent or effect
of providing such Person or Persons with short-term gains or profits under
circumstances in which the Board of Directors of the Company determines that the
long-term interests of the Company and its stockholders would not be served by
taking such actions or entering into such transactions; or (B) beneficial
ownership of Common Shares by such Person or Persons is reasonably likely to
have a material adverse effect on the business, competitive position, prospects,
or financial condition of the Company and its Subsidiaries; provided, however,
that Robert A. Young, III will not be an Adverse Person under the terms of this
Agreement. The failure by the Board of Directors at any time to determine a
Person to be an Adverse Person following such Person becoming a Beneficial Owner
of 10% or more of the outstanding Common Shares will not create any implication
that such Person is not or may not later be determined to be an Adverse Person.

         SECTION 2. APPOINTMENT OF RIGHTS AGENT.

         The Company hereby appoints the Rights Agent to act as agent for the
Company and the holders of the Rights (who will prior to the Distribution Date
also be the holders of the Common Shares in accordance with Section 3 of this
Agreement) subject to the terms and conditions of this Agreement, and the Rights
Agent hereby accepts such appointment. The Company may from time to time appoint
such co-Rights Agents as it may deem necessary, appropriate or desirable.

         SECTION 3. ISSUE OF RIGHT CERTIFICATES.

         (a) Until the Distribution Date, (i) the Rights will be evidenced
(subject to the provisions of Section 3(b) of this Agreement) by the
certificates for Common Shares registered in the names of the holders of such
certificates (which certificates will also be deemed to be Right Certificates)
and not by separate Right Certificates, and (ii) the right to receive Right

                                      -7-
<PAGE>   11

Certificates will be transferable only in connection with the transfer of Common
Shares. The Company shall give the Rights Agent prior written notice of the
Distribution Date and the circumstances giving rise thereto. As soon as
practicable after the Distribution Date, the Company will prepare and execute,
the Rights Agent will countersign, and the Company will send or cause to be sent
(and the Rights Agent will, if requested, send) by first-class, insured,
postage-prepaid mail, to each record holder of Common Shares (except as
otherwise provided in Section 11(a)(iii) of this Agreement) as of the Close of
Business on the Distribution Date, at the address of such holder shown on the
records of the Company, a Right Certificate evidencing one Right for each Common
Share so held, subject to the adjustments as provided herein. As of the
Distribution Date, the Rights will be evidenced solely by such Right
Certificates.

         (b) On the Record Date or as soon as practicable thereafter, the
Company will send a copy of the Summary of Rights by first-class,
postage-prepaid mail, to each record holder of Common Shares as of the Close of
Business on the Record Date, at the address of such holder shown on the records
of the Company. With respect to certificates for Common Shares outstanding as of
the Record Date, until the Distribution Date, the Rights will be evidenced by
such certificates registered in the names of the holders of such certificates
together with a copy of the Summary of Rights attached to such certificates.
Until the Distribution Date (or the earlier of the Redemption Date or Final
Expiration Date), the surrender for transfer of any certificate for Common
Shares outstanding on the Record Date, with or without a copy of the Summary of
Rights attached to such certificates, will also constitute the transfer of the
Rights associated with the Common Shares represented by such certificates. As
soon as practicable after the date of this Agreement, the Company will send a
copy of the Summary of Rights by first-class, postage-prepaid mail, to each
record holder of Common Shares as of the Close of Business on the date of this
Agreement, at the address of such holder shown on the records of the Company.

         (c) Certificates for Common Shares that become outstanding (including,
without limitation, reacquired Common Shares referred to in the last sentence of
this Section 3(c)) after the Record Date but prior to the Close of Business on
the earlier of the Distribution Date, the Redemption Date or the Final
Expiration Date will have impressed on, printed on, written on or otherwise
affixed to them the following legend:

         This certificate also evidences and entitles the holder of this
         certificate to certain rights as set forth in a Rights Agreement
         between Arkansas Best Corporation and Harris Trust and Savings Bank,
         dated as of April 23, 1992 (as amended from time to time, the "Rights
         Agreement"), the terms of which is on file at the principal executive
         offices of Arkansas Best Corporation. Under certain circumstances, as
         set forth in the Rights Agreement, such Rights will be evidenced by
         separate certificates and will no longer be evidenced by this
         certificate. Arkansas Best Corporation will mail to the holder of this
         certificate a copy of the Rights Agreement. As described in the Rights
         Agreement, Rights issued to Acquiring Person or Adverse Persons or
         their Affiliates or Associates (as defined in the Rights Agreement) may
         under certain circumstances become null and void.

With respect to such certificates containing the foregoing legend, until the
Distribution Date, the Rights associated with the Common Shares represented by
such certificates will be evidenced by such certificates alone, and the
surrender for transfer of any such certificate will also constitute

                                      -8-
<PAGE>   12

the transfer of the Rights associated with the Common Shares represented by such
certificate. In the event that the Company purchases or acquires any Common
Shares after the Record Date but prior to the Distribution Date, any Rights
associated with such Common Shares will be deemed cancelled and retired so that
the Company will not be entitled to exercise any Rights associated with the
Common Shares that are no longer outstanding.

         SECTION 4. FORM OF RIGHT CERTIFICATES.

         The Right Certificates (and the forms of election to purchase Common
Shares and of assignment to be printed on the reverse of the Right Certificates)
will be substantially in the form of Exhibit A to this Agreement and, in
addition, may have such marks of identification or designation and such legends,
summaries or endorsements printed on such Right Certificates as the Company may
deem necessary or appropriate and as are not inconsistent with the provisions of
this Agreement, or as may be required to comply with any applicable law, rule or
regulation, to comply with any rule or regulation of any stock exchange or
interdealer quotation system on which the Rights may from time to time be listed
or traded, or to conform to usage. Subject to the provisions of Section 22 of
this Agreement, the Right Certificates will entitle the holders of such
certificates to purchase such number of Common Shares as will be set forth in
such certificates at the Purchase Price, but the number of such Common Shares
and the Purchase Price shall be subject to adjustment as provided in this
Agreement.

         SECTION 5. COUNTERSIGNATURE AND REGISTRATION.

         (a) The Right Certificates will be executed on behalf of the Company by
its Chairman of the Board, its Chief Executive Officer, its President, or any of
its Vice Presidents, either manually or by facsimile signature, will have
affixed the Company's seal or a facsimile of the Company's seal, and will be
attested by the Secretary or an Assistant Secretary or the Treasurer or an
Assistant Treasurer of the Company, either manually or by facsimile signature.
Upon an order or request of the Company, the Right Certificates will be
countersigned manually by the Rights Agent and will not be valid for any purpose
unless countersigned. In case any officer of the Company who has signed any of
the Right Certificates ceases to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the Company,
such Right Certificates, nevertheless, may be countersigned by the Rights Agent
and issued and delivered by the Company with the same force and effect as though
the person who signed such Right Certificates had not ceased to be such officer
of the Company; and any Right Certificate may be signed on behalf of the Company
by any officer who, at the actual date of the execution of such Right
Certificate, is a proper officer of the Company to sign such Right Certificate,
although at the date of the execution of this Agreement any such person was not
such an officer.

         (b) Following the Distribution Date, the Rights Agent will keep or
cause to be kept, at its stockholder services offices, books for registration
and transfer of the Right Certificates issued under this Agreement. Such books
will show the names and addresses of the respective holders of the Right
Certificates, the number of Rights evidenced on its face by each of the Right
Certificates and the date of each of the Right Certificates.

                                      -9-
<PAGE>   13

         SECTION 6. TRANSFER, SPLIT-UP, COMBINATION AND EXCHANGE OF RIGHT
CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN RIGHT CERTIFICATES.

         (a) Subject to the provisions of Section 14 of this Agreement, at
any time after the Close of Business on the Distribution Date, and at or prior
to the Close of Business on the earlier of the Redemption Date or the Final
Expiration Date, any Right Certificate or Right Certificates may be transferred,
split up, combined or exchanged for another Right Certificate or Right
Certificates, entitling the registered holder to purchase in the aggregate a
like number of Common Shares as the Right Certificate or Right Certificates
surrendered then entitled such holder to purchase. Any registered holder
desiring to transfer, split up, combine or exchange any Right Certificate or
Right Certificates will make such request in writing delivered to the Rights
Agent, and will surrender the Right Certificate or Right Certificates to be
transferred, split up, combined or exchanged with the form of assignment thereon
duly executed at the stockholder services office of the Rights Agent. Thereupon
the Rights Agent will countersign and deliver to the Person entitled thereto a
Right Certificate or Right Certificates, as the case may be, as so requested.
The Company or the Rights Agent may require payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection with any
transfer, split up, combination or exchange of Right Certificates.

         (b) Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or mutilation of
a Right Certificate, and, in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to them, and, at the Company's or Rights
Agent's request, reimbursement to the Company and the Rights Agent of all
reasonable expenses incidental to such indemnity or security, and upon surrender
to the Rights Agent and the cancellation of the Right Certificate if mutilated,
the Company will make and deliver a new Right Certificate of like tenor to the
Rights Agent for countersignature and delivery to the registered holder in lieu
of the Right Certificate so lost, stolen, destroyed or mutilated.

         SECTION 7. EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE OF
RIGHTS.

         (a) Subject to Section 7(e) hereof, the registered holder of any Right
Certificate may exercise the Rights evidenced by such certificate (except as
otherwise provided in this Agreement) in whole or in part at any time after the
Distribution Date upon surrender of the Right Certificate, with the form of
election to purchase on the reverse side of such certificate duly executed, to
the Rights Agent at the stockholder services office of the Rights Agent
designated for such purpose, together with payment of the Purchase Price for
each Common Share as to which the Rights are exercised, at or prior to the
earlier of (i) the Final Expiration Date or (ii) the Redemption Date.

         (b) The Purchase Price for each Common Share purchased pursuant to the
exercise of a Right is $80.00, will be subject to adjustment from time to time
as provided in Sections 11 and 13 of this Agreement and will be payable in
lawful money of the United States of America in accordance with Section 7(c) of
this Agreement.

                                      -10-
<PAGE>   14

         (c) Upon receipt of a Right Certificate representing exercisable
Rights, with the form of election to purchase duly executed, accompanied by
payment of the Purchase Price for the shares to be purchased and an amount equal
to any applicable transfer tax required to be paid by the holder of such Right
Certificate in accordance with Section 9 of this Agreement by certified check,
cashier's check, bank draft or money order payable to the order of the Company
or the Rights Agent, the Rights Agent will thereupon promptly (i) requisition
from any transfer agent of the Common Shares certificates (or make available
certificates if the Rights Agent is the transfer agent for such shares) for the
number of Common Shares to be purchased and the Company hereby irrevocably
authorizes its transfer agent to comply with all such requests; (ii) when
appropriate, requisition from the Company the amount of cash to be paid in lieu
of issuance of fractional shares in accordance with Section 14 of this
Agreement; (iii) after receipt of such Common Shares certificates, cause the
same to be delivered to or upon the order of the registered holder of such Right
Certificate, registered in such name or names as may be designated by such
holder; and (iv) when appropriate, after receipt, deliver such cash to or upon
the order of the registered holder of such Right Certificate. In the event the
Company is obligated to issue other securities (including Common Shares) of the
Company, pay cash and/or distribute other property pursuant to Section 11(a) of
this Rights Agreement, the Company will make all arrangements necessary so that
other securities, cash and/or other property are available for distribution by
the Rights Agent, if and when appropriate.

         (d) In case the registered holder of any Right Certificate exercises
less than all the Rights evidenced by such certificate, a new Right Certificate
evidencing Rights equivalent to the Rights remaining unexercised will be
countersigned by the Rights Agent and delivered to the registered holder of such
Right Certificate or to a duly authorized assigns, subject to the provisions of
Section 14 of this Agreement.

         (e) Notwithstanding anything in this Agreement to the contrary, from
and after the occurrence of a Trigger Event, any Rights beneficially owned by
(A) an Acquiring Person or an Adverse Person or an Associate or Affiliate of an
Acquiring Person or an Adverse Person, (B) a transferee of an Acquiring Person
or an Adverse Person (or of any such Associate or Affiliate) who becomes a
transferee after an Acquiring Person or an Adverse Person, becomes such, or (C)
a transferee of an Acquiring Person or an Adverse Person (or such Associate or
Affiliate) who becomes a transferee prior to or concurrently with an Acquiring
Person or an Adverse Person becoming such and receives such Rights pursuant to
either (1) a transfer (whether or not for consideration) from the Acquiring
Person or Adverse Person to holders of equity interests in such Acquiring Person
or Adverse Person or to any Person with whom the Acquiring Person or Adverse
Person has any continuing agreement, arrangement or understanding regarding the
transferred Rights or (2) a transfer which the Board of Directors otherwise
concludes in good faith is part of a plan, arrangement or understanding which
has as a primary purpose or effect the avoidance of this Section 7(e), shall
become null and void without any further action, and any holder of such Rights
shall thereupon have no rights whatsoever with respect to such Rights, whether
under any provision of this Agreement or otherwise, from and after the
occurrence of a Triggering Event. The Company shall use all reasonable efforts
to insure that the provisions of this Section 7(e), are complied with, but shall
have no liability to say holder of Rights for the inability to make any
determinations with respect to an Acquiring Person or an Adverse Person or their
Affiliates, Associates or transferees hereunder.

                                      -11-
<PAGE>   15

         SECTION 8. CANCELLATION AND DESTRUCTION OF RIGHT CERTIFICATES.

         All Right Certificates surrendered for the purpose of exercise,
transfer, split up, combination or exchange will, if surrendered to the Company
or to any of its agents, be delivered to the Rights Agent for cancellation or in
cancelled form, or, if surrendered to the Rights Agent, will be cancelled by it,
and no Right Certificates will be issued in lieu of such certificates except as
expressly permitted by the provisions of this Agreement. The Company will
deliver to the Rights Agent for cancellation and retirement, and the Rights
Agent will so cancel and retire, any other Right Certificate purchased or
acquired by the Company otherwise than upon the exercise of such certificates.
The Rights Agent will deliver all cancelled Right Certificates to the Company,
or, at the written request of the Company, will destroy such cancelled Right
Certificates, and in such case will deliver a certificate of destruction of such
certificates to the Company.

         SECTION 9. RESERVATION AND AVAILABILITY OF COMMON SHARES.

         (a) The Company covenants and agrees that it will cause to be reserved
and kept available out of its authorized and unissued Common Shares or any
Common Shares held in its treasury, the number of Common Shares that will be
sufficient to permit the exercise in full of all outstanding Rights.

         (b) The Company covenants and agrees that it will take all such action
as may be necessary to ensure that all Common Shares delivered upon exercise of
Rights will be, at the time of delivery of the certificates for such Common
Shares (subject to payment of the Purchase Price), duly and validly authorized
and issued, fully paid and nonassessable shares.

         (c) The Company further covenants and agrees that it will pay when due
and payable any and all federal and state transfer taxes and charges that may be
payable in respect of the issuance or delivery of the Right Certificates or of
any Common Shares upon the exercise of Rights. The Company will not, however, be
required to pay any transfer tax that may be payable in respect of any transfer
or delivery of Right Certificates to a Person other than, or the issuance or
delivery of Common Shares or other securities in a name other than that of, the
registered holder of the Right Certificate evidencing Rights surrendered for
exercise. Further, the Company will not be required to issue or deliver any
certificates for Common Shares or other securities upon the exercise of any
Rights until any such tax has been paid (any such tax being payable by the
holder of such Right Certificate at the time of surrender) or until it has been
established to the Company's satisfaction that no such tax is due.

         (d) The Company also covenants and agrees to use its best efforts to
(i) file, as soon as practicable following the first occurrence of a Trigger
Event or as soon as is required by applicable law following the Distribution
Date, as the case may be, a registration statement under the Securities Act with
respect to the securities purchasable upon exercise of the Rights on an
appropriate form, (ii) cause such registration statement to become effective as
soon as practicable after such filing and (iii) cause such registration
statement to remain effective (with a prospectus at all times meeting the
requirements of the Securities Act) until the earlier of (A) the date as of

                                      -12-
<PAGE>   16

which the Rights are no longer exercisable for such securities and (B) the Final
Expiration Date. The Company will also take such action as may be appropriate
under, or to ensure compliance with the applicable securities or "blue sky" laws
of the various states in connection with the exercisability of the Rights. All
of the Company's actions under this Section 9(d), shall be at the Company's
expense.

         (e) If the Common Shares or other securities issuable upon the exercise
of the Rights are listed on any national securities exchange or interdealer
quotation system of a registered national securities association, the Company
shall use its best efforts to cause, from and after such time as the Rights
become exercisable, all Common Shares or other securities reserved for such
issuance to be listed on such exchange or quotation system upon official notice
of issuance.

         SECTION 10. COMMON SHARES RECORD DATE.

         Each Person in whose name any certificate for Common Shares is issued
upon the exercise of Rights will, for all purposes, be deemed to have become the
holder of record of the Common Shares represented by such certificate on, and
such certificate will be dated, the date on which the Right Certificate
evidencing such Rights was duly surrendered and payment of the Purchase Price
(and any applicable transfer taxes) was made; provided, however, that if the
date of such surrender and payment is a date upon which the Common Shares
transfer books of the Company are closed, such Person will be deemed to have
become the record holder of such shares on, and such certificate will be dated,
the next succeeding Business Day on which the Common Shares transfer books of
the Company are open.

         SECTION 11. ADJUSTMENT OF PURCHASE PRICE, NUMBER OF SHARES OR NUMBER OF
RIGHTS.

         The Purchase Price, the number of Common Shares covered by each Right,
and the number of Rights outstanding are subject to adjustment from time to time
as provided in this Section 11.

         (a) (i) In the event the Company, at any time after the date of this
         Agreement, (A) declares a dividend on the Common Shares payable in
         Common Shares, (B) subdivides the outstanding Common Shares (C)
         combines the outstanding Common Shares into a smaller number of Common
         Shares, or (D) issues any shares of its capital stock in a
         reclassification of the Common Shares (including any such
         reclassification in connection with a consolidation or merger in which
         the Company is the continuing or surviving corporation), except as
         otherwise provided in this Section 11(a) and Section 7(e) of this
         Agreement, the Purchase Price in effect at the time of the record date
         for such dividend or of the effective date of such subdivision,
         combination or reclassification, and the number and kind of shares of
         capital stock covered by such Right on such date, will be
         proportionately adjusted so that the holder of any Right exercised
         after such time will be entitled to receive the aggregate number and
         kind of shares of capital stock that, if such Right had been exercised
         immediately prior to such date and at a time when the Common Shares
         transfer books of the Company were open, such holder would have

                                      -13-
<PAGE>   17

         owned upon such exercise and been entitled to receive by virtue of such
         dividend, subdivision, combination or reclassification.

                  (ii) Upon the effective date of a Trigger Event, proper
         provision will be made so that each holder of a Right, except as
         otherwise provided in this Agreement, will thereafter have a right to
         receive, upon exercise of such Right at a price equal to the then
         current Purchase Price multiplied by the number of Common Shares for
         which a Right is then exercisable, in accordance with the terms of this
         Agreement, such number of Common Shares (the "number of Adjustment
         Shares") of the Company as then equal the result obtained by (A)
         multiplying the then current Purchase Price by the then number of
         Common Shares for which a Right is then exercisable and dividing that
         product by (B) 50% of the then current per share market price of the
         Company's Common Shares on the effective date of such Trigger Event.

                  (iii) In the event that there are not sufficient treasury
         shares or authorized but unissued Shares to permit the exercise in full
         of the Rights in accordance with Section 11(a)(ii) of this Agreement,
         the Company shall: (A) determine the excess of (1) the current market
         value of the number of Adjustment Shares issuable upon the exercise of
         a Right (the "Current Value") over (2) the Purchase Price (such excess,
         the "Spread"), and (B) with respect to each Right, make adequate
         provision to substitute for the number of Adjustment Shares, upon
         payment of the applicable Purchase Price, (1) cash, (2) a reduction in
         the Purchase Price (but not below zero), (3) Common Shares or other
         equity securities of the Company (including, without limitation, shares
         or units of shares which the Board of Directors of the Company has
         deemed to have the same value and voting rights as shares of Common
         Shares), (4) debt securities of the Company, (5) other assets or (6)
         any combination of the foregoing, having an aggregate value equal to
         the Current Value, where such aggregate value has been determined by
         the Board of Directors of the Company based upon the advice of a
         nationally recognized investment banking firm selected by the Board of
         Directors of the Company; provided, however, if the Company shall not
         have made adequate provision to deliver value pursuant to clause (B)
         above within 30 days following the effective date of a Trigger Event,
         then the Company shall be obligated to deliver, upon the surrender for
         exercise of a Right and without requiring payment of the Purchase
         Price, Common Shares (to the extent available) and then, if necessary,
         cash, which shares and/or cash have an aggregate value equal to the
         Spread. For purposes of this Section 11(a)(iii), the value of the
         Common Shares shall be the current per share market price of the Common
         Shares on the effective date of the Trigger Event.

         (b) In case the Company fixes a record date for the issuance of rights,
options or warrants to all holders of Common Shares entitling them (for a period
expiring within forty-five (45) days after such record date) to subscribe for or
purchase Common Shares or Equivalent Common Shares or securities convertible,
directly or indirectly, into Common Shares or Equivalent Common Shares at a
price per Common Share or Equivalent Common Share (or having a conversion price
per share, if a security convertible into Common Shares or Equivalent Common
Shares) less than the then current per share market price of the Common Shares
on such record date, the Purchase Price to be in effect after such record date
will be determined by

                                      -14-
<PAGE>   18

multiplying the Purchase Price in effect immediately prior to such record date
by a fraction, the numerator of which is the number of Common Shares outstanding
on such record date plus the number of Common Shares that the aggregate offering
price of the total number of Common Shares and/or Equivalent Common Shares so to
be offered (and/or the aggregate initial conversion price of the convertible
securities so to be offered) would purchase at such current market price and the
denominator of which is the number of Common Shares outstanding on such record
date plus the number of additional Common Shares and/or Equivalent Common Shares
to be offered for subscription or purchase (or into which the convertible
securities so to be offered are initially convertible). In case such
subscription price may be paid in consideration, part or all of which is in a
form other than cash, the value of such consideration will be as determined in
good faith by the Board of Directors of the Company, whose determination shall
be described in a statement filed with the Rights Agent. Common Shares owned by
or held for the account of the Company will not be deemed outstanding for the
purpose of any such computation. Such adjustment will be made successively
whenever such a record date is fixed; and in the event that such rights or
warrants are not so issued, the Purchase Price will be adjusted to be the
Purchase Price that would then be in effect if such record date had not been
fixed.

         (c) In case the Company fixes a record date for the making of a
distribution to all holders of the Common Shares (including any such
distribution made in connection with a consolidation or merger in which the
Company in the continuing or surviving corporation) of evidences of
indebtedness, cash (other than a regular quarterly cash dividend out of the
earnings or retained earnings of the Company), assets (other than a dividend
payable in Common Shares) or subscription rights or warrants (excluding those
referred to in Section 11(b) of this Agreement), the Purchase Price to be in
effect after such record date will be determined by multiplying the repurchase
Price in effect immediately prior to such record date by a fraction, the
numerator of which is the then current per share market price of the Common
Shares on such record date, less the fair market value (as determined in good
faith by the Board of Directors of the Company, whose determination will be
described in a statement filed with the Rights Agent) of the portion of the
evidences of indebtedness, cash or assets so to be distributed or of such
subscription rights or warrants applicable to one Common Share and the
denominator of which is such current per share market price of the Common
Shares. Such adjustments will be made successively whenever such a record date
is fixed; and in the event that such distribution is not so made, the Purchase
Price will again be adjusted to be the Purchase Price that would then be in
effect if such record date had not been fixed.

         (d) No adjustment in the Purchase Price will be required unless such
adjustment would require an increase or decrease of at least l%, in the Purchase
Price; provided, however, that any adjustments which by reason of this Section
11(d) are not required to be made will be carried forward and taken into account
in any subsequent adjustment. All calculations under this Section 11 will be
made to the nearest cent or to the nearest ten-thousandth of a Common Share or
of any other share or security, as the case may be. Notwithstanding the first
sentence of this Section 11(d), any adjustment required by this Section 11(d),
will be made no later than the earlier of (i) three (3) years from the date of
the transaction that requires such adjustment or (ii) the date of the expiration
of the right to exercise any Rights.

                                      -15-
<PAGE>   19

         (e) If, as a result of an adjustment made pursuant to Section 11(a) of
this Agreement, the holder of any Right exercised becomes entitled to receive
any shares of capital stock of the Company other than Common Shares, the number
of such other shares so receivable upon exercise of any Right will be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the Common Shares contained in
Sections 11(a) through (c), inclusive, and the provisions of Sections 7, 9, 10
and 13 with respect to the Common Shares will apply on like terms to any such
other shares.

         (f) All Rights originally issued by the Company subsequent to any
adjustment made to the Purchase Price under this Agreement will evidence the
right to purchase, at the adjusted Purchase Price, the number of Common Shares
purchasable from time to time under this Agreement upon exercise of the Rights,
all subject to further adjustment as provided in this Agreement.

         (g) Unless the Company has exercised its election as provided in
Section 11(h), of this Agreement, upon each adjustment of the Purchase Price as
a result of the calculations made in Section 11(b) and (c) of this Agreement,
each Right outstanding immediately prior to the making of such adjustment will
thereafter evidence the right to purchase, at the adjusted Purchase Price, that
number of Common Shares (calculated to the nearest one ten-thousandth of a
Common Share) obtained by (i) multiplying (A) the number of Common Shares
covered by a Right immediately prior to this adjustment by (B) the Purchase
Price in effect immediately prior to such adjustment of the Purchase Price and
(ii) dividing the product so obtained by the Purchase Price in effect
immediately after such adjustment of the Purchase Price.

         (h) The Company may elect on or after the date of any adjustment of the
Purchase Price to adjust the number of Rights, in substitution for any
adjustment in the number of Common Shares purchasable upon the exercise of a
Right. Each of the Rights outstanding after such adjustment of the number of
Rights will be exercisable for the number of Common Shares for which a Right was
exercisable immediately prior to such adjustment. Each Right held of record
prior to such adjustment of the number of Rights will become that number of
Rights (calculated to the nearest one ten-thousandth) obtained by dividing the
Purchase Price in effect immediately prior to adjustment of the Purchase Price
by the Purchase Price in effect immediately after adjustment of the Purchase
Price. The Company will make a public announcement of its election to adjust the
number of Rights, indicating the record date for the adjustment to be made. Such
record date may be the date on which the Purchase Price is adjusted or any day
thereafter, but, if the Right Certificates have been issued, will be at least
seven (7) Business Days later than the date of the public announcement. If Right
Certificates have been issued, upon each adjustment of the number of Rights
pursuant to this Section 11(h), the Company will, as promptly as practicable,
cause to be distributed to holders of record of Right Certificates on such
record date Right Certificates evidencing, subject to Section 14 of this
Agreement, the additional Rights to which such holders are entitled as a result
of such adjustment, or, at the option of the Company, will cause to be
distributed to such holders of record in substitution and replacement for the
Right Certificates held by such holders prior to the date of adjustment, and
upon surrender of Right Certificates (if required by the Company) new Right
Certificates evidencing all the Rights to which such holders are entitled after
such adjustment. Right Certificates so to be distributed will be issued,
executed and countersigned in

                                      -16-
<PAGE>   20

the manner provided for in this Agreement and will be registered in the names of
the holders of record of Right Certificates on the record date specified in the
public announcement.

         (i) Irrespective of any adjustment or change in the Purchase Price or
the number of Common Shares issuable upon the exercise of the Rights, the Right
Certificates theretofore and thereafter issued may continue to express the
Purchase Price and the number of Common Shares that were expressed in the
initial Right Certificates issued under this Agreement.

         (j) Before taking any action that would cause an adjustment reducing
the Purchase Price below the then par value, if any, of the Common Shares or
other securities issuable upon exercise of the Rights, the Company will take all
such action as may be necessary in order that the Company may validly and
legally issue fully paid and nonassessable Common Shares or other securities at
such adjusted Purchase Price.

         (k) In any case in which this Section 11 requires that an adjustment in
the Purchase Price be made effective as of a record date for a specified event,
the Company may elect to defer until the occurrence of such event the issuing to
the holder of any Right exercised after such record date of the Common Shares
and other capital stock or securities of the Company, if any, issuable upon such
exercise over and above the Common Shares and other capital stock or securities
of the Company, if any, issuable upon such exercise on the basis of the Purchase
Price in effect prior to such adjustment; provided, however, that the Company
will deliver to such holder a due bill or other appropriate instrument
evidencing right of such holder to receive such additional shares upon the
occurrence of the event requiring such adjustment.

         (1) Anything in this Section 11 to the contrary notwithstanding, the
Company will be entitled to make such adjustments in the Purchase Price, in
addition to those adjustments expressly required by this Section 11, as and to
the extent that it in its sole discretion determines to be advisable in order
that any consolidation or subdivision of the Common Shares, issuance wholly for
cash of any Common Shares at less than the current per share market price,
issuance wholly for cash of any Common Shares or securities that by their terms
are directly or indirectly convertible into or exchangeable for Common Shares,
dividends in Common Shares payable in Common Shares or issuance of rights,
options or warrants referred to in Section 11(b) of this Agreement, hereafter
made by the Company to holders of its Common Shares will not be taxable to such
stockholders.

         SECTION 12. CERTIFICATE OF ADJUSTED PURCHASE PRICE OR NUMBER OF SHARES.

         Whenever an adjustment is made as provided in Sections 11 and 13 of
this Agreement, the Company will promptly (a) prepare a certificate setting
forth such adjustment and a brief statement of the facts accounting for such
adjustment, (b) file with the Rights Agent and with each transfer agent for the
Common Shares a copy of such certificate and (c) mail a brief summary of such
certificate to each holder of a Right Certificate in accordance with Section 25
of this Agreement; provided, however, that the failure of the Company to make
such a certificate or give notice shall not affect the validity or the force or
effect of the requirement for such an adjustment. The Rights Agent shall be
fully protected in relying on such certificate and any adjustment therein
contained.

                                      -17-
<PAGE>   21

         SECTION 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS OR
EARNING POWER.

         (a) In the event on or after the Stock Acquisition Date, directly or
indirectly, (i) the Company consolidates with or merges with and into any other
Person (other than with a Subsidiary of the Company and the Company shall not be
the continuing or surviving corporation; (ii) any Person (other than a
Subsidiary of the Company) consolidates with the Company or merges with and into
the Company and the Company is the continuing or surviving corporation of such
merger and, in connection with such merger, all or part of the Common Shares is
changed into or exchanged for stock or other securities of any other Person or
cash or any other property; or (iii) the Company sells or otherwise transfers
(or one or more of its Subsidiaries sells or otherwise transfers) in one or more
transactions, assets or earning power aggregating 50% or more of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to any
other Person other than the Company or one or more of its Subsidiaries, then,
and in each such case (except as may be contemplated by Section 13(e) hereof),
proper provision will be made so that (A) following the Distribution Date, each
holder of a Right (except as otherwise provided in Section 7(e) hereof) will
thereafter have the right to receive, upon the exercise of such Rights at a
price equal to the then current Purchase Price multiplied by the number of
Common Shares for which a Right is then exercisable, in accordance with the
terms of this Agreement, such number of validly authorized and issued, fully
paid, non-assessable and freely tradeable shares of Common Shares of the
Principal Person (as defined below), not subject to any liens, encumbrances,
rights of call, rights of first refusal or other adverse claims as is equal to
the result obtained by (1) multiplying the then current Purchase Price by the
number of Common Shares for which a Right is then exercisable and dividing that
product by (2) 50% of the then current per share market price of the Common
Shares of the Principal Person on the date of consummation of such
consolidation, merger, sale or transfer; (B) the Principal Person will
thereafter be liable for, and will assume, by virtue of such consolidation,
merger, sale or transfer, all the obligations and duties of the Company pursuant
to this Agreement; (C) the term "Company" will thereafter be deemed to refer to
the Principal Person, it being specifically intended that the provisions of
Section 11 hereof shall apply only to such Principal Person following the first
occurrence of a Section 13 event; (D) the Principal Person will take all such
steps (including, but not limited to, the reservation of a sufficient number of
its Common Shares in accordance with Section 9 of this Agreement) in connection
with such consummation as may be necessary to assure that the provisions of this
Agreement will thereafter be applicable, as nearly as possible, in relation to
the Common Shares thereafter deliverable upon the exercise of the Rights; and
(E) the provisions of Section 11(a)(ii) hereof shall be of no effect following
the first occurrence of any event set forth in this Section 13.

         (b) The term "Principal Person" shall mean

                  (i) In the case of any transaction described in sub-clause (i)
         or (ii) of this Section 13(a), the Person that is the issuer of any
         securities into which shares of Common Shares of the Company are
         converted in such merger or consolidation, and if no

                                      -18-
<PAGE>   22

         securities are so issued, the Person that is the other party to the
         merger or consolidation; and

                  (ii) in the case of any transaction described in the
         sub-clause (iii) of this Section 13(a), the Person that is the party
         receiving the greatest portion of the assets or earning power
         transferred pursuant to such transaction or transactions;

provided, however, that in any such case, (A) if the Common Shares of such
Person is not at such time and has not been continuously over the preceding
12-month period registered under Section 12 of the Exchange Act, and such Person
is a direct or indirect Subsidiary or Affiliate of another Person, the Common
Shares of which is and has been so registered, "Principal Person" shall refer to
such other Person; (B) in case such Person is a subsidiary, directly or
indirectly, or Affiliate of more than one Person, the Common Shares of two or
more of which are and have been so registered, "Principal Person" shall refer to
whichever of such Persons is the issuer of the Common Shares having the greatest
aggregate market value; and (C) in case such Person is owned, directly or
indirectly, by a joint venture formed by two or more Persons that are not owned,
directly or indirectly, by the same Person, the rules set forth in (A) and (B)
above shall apply to each of the chains of ownership having an interest in such
joint venture as if such party were a "Subsidiary" of both or all of such joint
venturers and the Principal Persons in each such chain shall bear the
obligations set forth in this Section 13 in the same ratio as their direct or
indirect interests in such Person bear to the total of such interests.

         (c) The Company will not enter into any transaction of the kind
referred to in this Section 13 if at the time of such transaction there are any
rights, warrants, instruments or securities outstanding or any written or oral
agreements, arrangements or understandings that, as a result of the consummation
of such transaction, would eliminate or substantially diminish the benefits
intended to be afforded by the Rights. The Company will not consummate any such
consolidation, merger, sale or transfer unless prior to such consummation (i)
the Principal Person shall have a sufficient number of authorized shares of its
Common Shares which have not been issued or reserved for issuance to permit the
exercise in full of the Rights in accordance with this Section 13; and (ii) the
Company and the Principal Person shall have executed and delivered to the Rights
Agent a supplemental agreement so providing and further providing that, as soon
as practicable after the date of any consolidation, merger, sale or transfer of
assets mentioned in paragraph (a) of this Section 13, the Principal Person at
its own expense will take each of the following actions:

                  (i) prepare and file a registration statement under the
         Securities Act with respect to the Rights and the securities
         purchasable upon exercise of the Rights on an appropriate form, will
         use its best efforts to cause such registration statement to become
         effective an soon as practicable after such filing and will use its
         best efforts to cause such registration statement to remain effective
         (with a prospectus at all times meeting the requirements of the
         Securities Act) until the Final Expiration Date;

                  (ii) use its best efforts to qualify or register the Rights
         and the securities purchasable upon exercise of the Rights under the
         applicable securities or blue sky laws of such jurisdictions an may be
         necessary or appropriate; and

                                      -19-
<PAGE>   23

                  (iii) deliver to holders of the Rights historical financial
         statements for the Principal Person and each of its Affiliates which
         comply in all material respects with the requirements for registration
         on Form 10 (or any successor form) under the Exchange Act.

         (d) The provisions of this Section 13 will similarly apply to
successive mergers, consolidations, sales or other transfers. The rights under
this Section 13 shall be in addition to the rights to exercise Rights and
adjustments under Section 11(a)(ii) of this Agreement hereof and shall survive
any exercise thereunder.

         (e) Notwithstanding anything in this Agreement to the contrary, Section
13 shall not be applicable to a transaction described in subparagraphs (i) and
(ii) of Section 13(a) if (1) such transaction is consummated with a Person or
Persons who acquired shares of Common Shares pursuant to a tender offer or
exchange offer for all outstanding shares of Common Shares which complies with
Section 1(n) hereof (or a wholly owned Subsidiary of any such Person or
Persons), (2) the price per share of Common Shares offered in such transaction
is not less than the price per share of Common Shares paid to all holders of
shares of Common Shares whose shares were purchased pursuant to such tender
offer or exchange offer, and (iii) the form of consideration being offered to
the remaining holders of shares of Common Shares pursuant to such transaction is
the same as the form of consideration paid pursuant to such tender offer of
exchange offer. Upon consummation of any such transaction contemplated by this
Section 13(e), all Rights hereunder shall expire.

         SECTION 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.

         (a) The Company will not be required to issue fractions of Rights or to
distribute Right Certificates that evidence fractional Rights. In lieu of such
fractional Rights, the Company will pay to the registered holders of the Right
Certificates with regard to which such fractional Rights would otherwise be
issuable, an amount in cash equal to the same fraction of the current market
value of a whole Right. For the purposes of this Section 14(a), the current
market value of a whole Right will be the closing price of the Rights for the
Trading Day immediately prior to the date on which such fractional Rights would
have been otherwise issuable. The closing price for any day will be the last
sale price, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the New York Stock Exchange or,
if the Rights are not listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the Rights are listed or admitted to trading or, if the Rights are not
listed or admitted to trading on any national securities exchange, the last
quoted price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by NASDAQ or such other
system then in use or, if on any such date the Rights are not quoted by any such
organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in the Rights selected by the Board of
Directors of the Company

                                      -20-
<PAGE>   24

or, if the Rights are not publicly listed or traded, the fair value of the
Rights on such date as determined in good faith by the Board of Directors of the
Company will be used.

         (b) The Company will not be required to issue fractions of Common
Shares upon exercise of the Rights or to distribute certificates that evidence
fractional Common Shares. In lieu of fractional Common Shares, the Company will
pay to the registered holders of Right Certificates at the time such Rights are
exercised as provided in this Agreement an amount in cash equal to the same
fraction of the current market value of one Common Share. For purposes of this
Section 14(b), the current market value of a Common Share will be the closing
price of a Common Share for the Trading Day immediately prior to the date of
such exercise.

         (c) The holder of a Right by the acceptance of the Right, expressly
waives all right to receive any fractional Rights or any fractional Common
Shares upon exercise of a Right.

         SECTION 15. RIGHTS OF ACTION.

         All rights of action in respect of this Agreement, except the rights of
action given to the Rights Agent under Section 18 of this Agreement, are vested
in the respective registered holders of the Right Certificates (and, prior to
the Distribution Date, the registered holders of the Common Shares); and any
registered holder of any Right Certificate (or, prior to the Distribution Date,
of the Common Shares), without the consent of the Rights Agent or of the holder
of any other Right Certificate (or, prior to the Distribution Date, of the
Common Shares), may, in its own behalf and for its own benefit, enforce, and may
institute and maintain any suit, action or proceeding against the Company to
enforce, or otherwise act in respect of, such holder's right to exercise the
Rights evidenced by such Right Certificate in the manner provided in such Right
Certificate and in this Agreement. Without limiting the foregoing or any
remedies available to the holders of Rights, it is specifically acknowledged
that the holders of Rights would not have an adequate remedy at law for any
breach of this Agreement and will be entitled to specific performance of the
obligations under, and injunctive relief against actual or threatened violations
of, the obligations of any Person subject to this Agreement.

         SECTION 16. AGREEMENT OF RIGHT HOLDERS.

Every holder of a Right, by accepting the Right, consents and agrees with the
Company and the Rights Agent and with every other holder of a Right that:

         (a) prior to the Distribution Date, the Rights will be transferable
only in connection with the transfer of the Common Shares;

         (b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if surrendered at
the principal offices of the Rights Agent or at its office in Chicago, Illinois,
designated for such purpose, duly endorsed or accompanied by a proper instrument
of transfer;

         (c) the Company and the Rights Agent may deem and treat the Person in
whose name the Right Certificate (or, prior to the Distribution Date, the
associated Common Shares

                                      -21-
<PAGE>   25

certificate) is registered as the absolute owner of the Right Certificate and of
the Rights evidenced by such certificate (notwithstanding any notations of
ownership or writing on the Right Certificates or the associated Common Shares
certificate made by anyone other than the Company or the Rights Agent) for all
purposes whatsoever, and neither the Company nor the Rights Agent will be
affected by any notice to the contrary; and

         (d) Notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability to any holder
of a Right or any other Person as a result of its inability to perform any of
its obligations under this Agreement by reason of any preliminary or permanent
injunction or other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative agency or
commission, or any other statute, rule, regulation or executive order
promulgated or enacted by any governmental authority, prohibiting or otherwise
restraining performance of such obligation.

         SECTION 17. RIGHT CERTIFICATE HOLDER NOT DEEMED A STOCKHOLDER.

         No holder, as such, of any Right Certificate will be entitled to vote,
receive dividends or be deemed for any purpose the holder of the Common Shares
or any other securities of the Company that may at any time be issuable on the
exercise of the Rights represented by such Right Certificate, nor will anything
contained in this Agreement or in any Right Certificate be construed to confer
upon the holder of any Right Certificate, as such, any of the rights of a
stockholder of the Company or any right to vote for the election of directors or
upon any matter submitted to stockholders at any meeting of stockholders, or to
receive notice of meetings or other actions affecting stockholders (except as
provided in Section 24 of this Agreement), or to receive dividends or
subscription rights or otherwise, until the Right or Rights evidenced by such
Right Certificate have been exercised in accordance with the provisions of this
Agreement.

         SECTION 18. CONCERNING THE RIGHTS AGENT.

         (a) The Company agrees to pay to the Rights Agent promptly reasonable
compensation for all services rendered by it under this Agreement and, from time
to time, on demand of the Rights Agent, its reasonable expenses and counsel fees
and other disbursements incurred in the administration and execution of this
Agreement and the exercise and performance of its duties under this Agreement.
The Company also agrees to indemnify the Rights Agent (and any Affiliate of the
Rights Agent) for, and to hold them harmless against, any loss, liability,
damage, cost or expense, incurred without gross negligence, bad faith or willful
misconduct on the part of the Rights Agent, for anything done or omitted by the
Rights Agent in connection with the acceptance and administration of its duties
under this Agreement, including the costs and expenses of defending against any
claim of liability in the premises, and including any loss, liability or expense
incurred through the Rights Agent's negligence (other than gross negligence).

         (b) The Rights Agent will be protected and will incur no liability for
or in respect of any action taken, suffered, or omitted by it in connection with
its administration of this Agreement in reliance upon any Right Certificate or
certificate for the Common Shares or for other securities of the Company,
instrument of assignment or transfer, power of attorney,

                                      -22-
<PAGE>   26

endorsement, affidavit, letter, notice, direction, consent, certificate,
statement, or other paper or document believed by it to be genuine and to be
signed, executed, and, where necessary, verified or acknowledged, by the proper
Person or Persons, or otherwise upon the advice of counsel as set forth in
Section 20 of this Agreement.

         SECTION 19. MERGER, CONSOLIDATION OR CHANGE OF NAME OF RIGHTS AGENT.

         (a) Any Person into which the Rights Agent or any successor Rights
Agent may be merged or with which it may be consolidated, or any Person
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent is a party, or any Person succeeding to the corporate
trust business of the Rights Agent or any successor Rights Agent, will be the
successor to the Rights Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties to this
Agreement, provided that such Person would be eligible for appointment as a
successor Rights Agent under the provisions of Section 21 of this Agreement. In
case at the time such successor Rights Agent succeeds to the agency created by
this Agreement, any of the Right Certificates have been countersigned but not
delivered, any such successor Rights Agent may adopt the countersignature of the
predecessor Rights Agent and deliver such Right Certificates so countersigned;
and in case at that time any of the Right Certificates have not been
countersigned, any successor Rights Agent may countersign such Right
Certificates either in the name of the predecessor Rights Agent or in the name
of the successor Rights Agent; and in all such cases such Right Certificates
will have the full force provided in the Right Certificates and in this
Agreement.

         (b) In case at any time the name of the Rights Agent is changed and at
such time any of the Right Certificates have been countersigned but not
delivered, the Rights Agent may adopt the countersignature under its prior name
and deliver Right Certificates so countersigned; and in case at that time any of
the Right Certificates have not been countersigned, the Rights Agent may
countersign such Right Certificates either in its prior name or in its changed
name; and in all such cases such Right Certificates will have the full force
provided in the Right Certificates and in this Agreement.

         SECTION 20. DUTIES OF RIGHTS AGENT.

         The Rights Agent undertakes the duties and obligations imposed by this
Agreement on the following terms and conditions, by all of which the Company and
the holders of Right Certificates (and prior to the Distribution Date, the
holders of the Common Shares), by their acceptance of this Agreement and the
Rights, agree to be bound:

         (a) The Rights Agent may consult with legal counsel of its sole choice
(which may be legal counsel for the Company), and the opinion of such counsel
will be full and complete authorization and protection to the Rights Agent as to
any action taken or omitted by it in good faith and in accordance with such
opinion.

         (b) The Rights Agent shall not be deemed to have knowledge of any fact
or matter pertaining to the performance of its duties under this Agreement,
except such facts or matters as are evidenced by records which are required to
be created and maintained by it hereunder, until it

                                      -23-
<PAGE>   27

shall have been advised thereof in writing by the Company or by a holder of the
Rights. Whenever in the performance of its duties under this Agreement the
Rights Agent deems it necessary or desirable that any fact or matter (including,
without limitation, the identity of any Acquiring Person or Adverse Person and
the determination of "current per share market price") be proved or established
by the Company prior to taking or suffering any action under this Agreement,
such fact or matter (unless other evidence in respect of such fact or matter is
specifically prescribed in this Agreement) may be deemed to be conclusively
proved and established by a certificate signed by any one of the Chairman of the
Board, Chief Executive Officer, the President, any Vice President, the
Treasurer, the Secretary, or any Assistant Treasurer or Assistant Secretary of
the Company and delivered to the Rights Agent; and such certificate will be full
authorization to the Rights Agent for any action taken or suffered in good faith
by it under the provisions of this Agreement in reliance upon such certificate.

         (c) The Rights Agent will be liable under this Agreement to the Company
and any other Person only for its gross negligence, bad faith or willful
misconduct. Notwithstanding anything to the contrary, in no event shall the
Rights Agent be liable for special, indirect, punitive or consequential loss or
damage of any kind whatsoever (including but not limited to lost profits).

         (d) The Rights Agent will not be liable for or by reason of any of the
statements of fact or recitals contained in this Agreement or in the Summary of
Rights or in the Right Certificates (except its countersignature of the Right
Certificates) or be required to verify the same, but all such statements and
recitals are and will be deemed to have been made by the Company only.

         (e) The Rights Agent will not be under any responsibility in respect of
the validity of this Agreement or the execution and delivery of this Agreement
(except the due execution of this Agreement by the Rights Agent) or in respect
of the validity or execution of any Right Certificate (except its
countersignature of a Right Certificate); nor shall it be responsible for any
breach by the Company of any covenant or condition contained in this Agreement
or in any Right Certificate; nor will it be responsible for any change in the
exercisability of the Rights or any adjustment in the terms of the Rights
(including the manner, method or amount of such adjustment) provided for in
Sections 3, 11, 13 or 23 of this Agreement, or the ascertaining of the existence
of facts that would require any such change or adjustment (except with respect
to the exercise of Rights evidenced by Right Certificates after actual notice
that such change or adjustment is required); nor will it by any act under this
Agreement be deemed to make any representation or warranty as to the
authorization or reservation of any Common Shares to be issued pursuant to this
Agreement or any Right Certificate or as to whether any Common Shares will, when
issued, be validly authorized and issued, fully paid, and nonassessable, or as
to the value of any Common Shares or any Right Certificate.

         (f) The Company agrees that it will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all such
further acts, instruments and assurances as may reasonably be required by the
Rights Agent for the carrying out or performing by the Rights Agent of the
provisions of this Agreement.

                                      -24-
<PAGE>   28

         (g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties under this Agreement
from any one of the Chief Executive Officer, the President, any Vice President,
the Secretary, the Treasurer or any Assistant Secretary or Assistant Treasurer
of the Company, and to apply to such officers for advice or instructions in
connection with its duties, and it will not be liable for any action taken or
suffered by it in good faith in accordance with instructions of any such officer
or for any delay in acting while waiting for such instructions.

         (h) The Rights Agent and any stockholder, director, officer or employee
of the Rights Agent may buy, sell or deal in any of the Rights or other
securities of the Company or become pecuniarily interested in any transaction in
which the Company may be interested, or contract with or lend money to the
Company or otherwise act as fully and freely as though it were not Rights Agent
under this Agreement. Nothing in this Agreement will preclude the Rights Agent
from acting in any other capacity for the Company or for any other Person.

         (i) The Rights Agent may execute and exercise any of the rights or
powers vested in it by this Agreement or perform any duty under this Agreement
either itself or by or through its attorneys or agents, and the Rights Agent
will not be answerable or accountable for any act, default, neglect or
misconduct of any such attorneys or agents or for any loss to the Company
resulting from any such act, default, neglect or misconduct, provided reasonable
care was exercised in the selection and continued employment of such attorneys
or agents.

         (j) No provision of this Agreement shall require the Rights Agent to
expend or risk its own funds or otherwise incur any financial liability in the
performance of its duties hereunder or in the exercise of its rights if there
shall be reasonable grounds for believing that repayment of such funds or
adequate indemnification against such risk or liability is not reasonably
assured to it.

         SECTION 21. CHANGE OF RIGHTS AGENT.

         The Rights Agent or any successor Rights Agent may resign and be
discharged from its duties under this Agreement upon thirty (30) days' notice in
writing mailed to the Company and to each transfer agent of the Common Shares by
registered or certified mail, and to the holders of the Right Certificates by
first-class mail. The Company may remove the Rights Agent or any successor
Rights Agent upon thirty (30) days' notice in writing, mailed to the Rights
Agent or successor Rights Agent, as the case may be, and to each transfer agent
of the Common Shares by registered or certified mail, and to the holders of the
Right Certificates by first-class mail. If the Rights Agent resigns or is
removed or otherwise becomes incapable of acting, the Company will appoint a
successor to the Rights Agent. If the Company fails to make such appointment
within a period of thirty (30) days after giving notice of such removal or after
it has been notified in writing of such resignation or incapacity by the
resigning or incapacitated Rights Agent or by the holder of a Right Certificate
(who will, with such notice, submit his Right Certificate for inspection by the
Company), then the registered holder of any Right Certificate may apply to any
court of competent jurisdiction for the appointment of a new Rights Agent. Any
successor Rights Agent, whether appointed by the Company or by such a court,
will be (a) a corporation, limited liability company or trust company (or
similar form of entity organized under the laws of

                                      -25-
<PAGE>   29

any state, the United States or a foreign jurisdiction) so long as such entity
is authorized under applicable laws to exercise corporate trust, fiduciary or
stockholder services powers and is subject to supervision or examination by
federal or state authority and which has at the time of its appointment as
Rights Agent a combined capital and surplus of at least $10,000,000, or (b) an
Affiliate controlled by an entity described in clause (a) of this sentence,
provided that such controlling an entity fully guarantees the performance of
such Affiliate's duties and obligations hereunder. After appointment, the
successor Rights Agent will be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Rights Agent without
further act or deed; but the predecessor Rights Agent will deliver and transfer
to the successor Rights Agent any property at the time held by it under this
Agreement and execute and deliver any further assurance, conveyance, act or deed
necessary for such purpose. Not later than the effective date of any such
appointment, the Company will file notice of such appointment in writing with
the predecessor Rights Agent and each transfer agent of the Common Shares, and
mail a notice of such appointment in writing to the registered holders of the
Right Certificates. Failure to give any notice provided for in this Section 21,
however, or any defect in such notice, will not affect the legality or validity
of the resignation or removal of the Rights Agent or the appointment of the
successor Rights Agent, as the case may be.

         SECTION 22. ISSUANCE OF NEW RIGHT CERTIFICATES.

         Notwithstanding any of the provisions of this Agreement or of the Right
Certificate to the contrary, the Company may, at its option, issue new Right
Certificates evidencing Rights in such form as may be approved by its Board of
Directors to reflect any adjustment or change in the Purchase Price and the
number or kind or class of shares or other securities or property purchasable
under the Right Certificates made in accordance with the provisions of this
Agreement.

         SECTION 23. REDEMPTION.

         (a) The Rights may be redeemed by the Board of Directors, upon Board
Approval, pursuant to Section 23(b) of this Agreement and cannot and will not be
redeemed in any other manner.

         (b) The Board of Directors of the Company may, at its option, at any
time prior to the Close of Business on the tenth (10th) day following the Stock
Acquisition Date, by Board Approval, redeem all but not less than all of the
then outstanding Rights at the Redemption Price; provided, that the Board of
Directors of the Company may, by Board Approval, reduce or extend the period
during which it may redeem all but not less than all of the Rights so long as
the Rights are redeemable at the time such reduction or extension is adopted.
The Company may, at its option, pay the Redemption Price, in cash, Common Shares
(based on the current per share market price at the time of redemption) or any
other form of consideration deemed appropriate by the Board of Directors.

         (c) Immediately upon the action of the Board of Directors of the
Company ordering the redemption of the Rights pursuant to Section 23(b) of this
Agreement, and without any further action and without any notice, the right to
exercise the Rights will terminate and the only

                                      -26-
<PAGE>   30

right thereafter of the holders of Rights will be to receive the Redemption
Price. Within ten (10) days after such action of the Board of Directors ordering
the redemption of the Rights pursuant to Section 23(b) of this Agreement, the
Company will give written notice of redemption to the Rights Agent and the
holders of the then outstanding Rights by mailing such notice to all such
holders at their last addresses as they appear upon the registry books of the
Rights Agent or, prior to the Distribution Date, on the registry books of the
transfer agent for the Common Shares. Any notice that is mailed in the manner
provided in this Agreement shall be deemed given, whether or not the holder
receives such notice. Each such notice of redemption will state the method by
which the payment of the Redemption Price will be made. Neither the Company nor
any of its Affiliates or Associates may redeem, acquire or purchase for value
any Rights at any time in any manner other than that specifically set forth in
this Section 23, and other than in connection with the purchase of Common Shares
prior to the Distribution Date.

         SECTION 24. NOTICE OF CERTAIN EVENTS.

         (a) In case the Company proposes (i) to pay any dividend payable in
stock of any class to the holders of its Common Shares or to make any other
distribution to the holders of its Common Shares, (ii) to offer to the holders
of its Common Shares rights or warrants to subscribe for or to purchase any
additional Common Shares or shares of stock of any class or any other
securities, rights or options, (iii) to effect any reclassification of its
Common Shares, (iv) to effect any consolidation or merger into or with, or to
effect any sale or other transfer (or to permit one or more of its Subsidiaries
to effect any sale or other transfer), in one or more transactions, of 50% or
more of the assets or earning power of the Company and its Subsidiaries (taken
as a whole) to, any other Person, (v) to effect the liquidation, dissolution or
winding up of the Company or (vi) to effect a subdivision, combination or
consolidation of the Common Shares (by reclassification or otherwise), then, in
each such case, the Company will give to each holder of a Right, in accordance
with Section 25 of this Agreement, a notice of such proposed action, which will
specify the record date for the purposes of such stock dividend, distribution of
rights or warrants, the date on which such reclassification, consolidation,
merger, sale, transfer, liquidation, dissolution or winding up is to take place
and the date of participation in such transactions by the holders of the Rights,
if any such date is to be fixed, and such notice will be so given in the case of
any action covered by clause (i) or (ii) above at least 20 days prior to the
record date for determining holders of the Common Shares for purposes of such
action, and in the case of any such other action, at least 20 days prior to the
date of the taking of such proposed action or the date of participation in such
transaction by the holders of the Common Shares, whichever is earlier.

         (b) In case a Trigger Event occurs, then, the Company will, as soon as
practicable thereafter, give to each holder of a Right, in accordance with
Section 25 of this Agreement, a notice of the occurrence of such Trigger Event,
which notice will describe the Trigger Event and the consequences of the Trigger
Event to holders of Rights under Section 11(a)(ii) of this Agreement.

                                      -27-
<PAGE>   31

         SECTION 25. NOTICES.

         Notices or demands authorized by this Agreement to be given or made by
the Rights Agent or by the holder of any Right to or on the Company will be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed (until another address is filed in writing with the Rights Agent) as
follows:

         Arkansas Best Corporation
         3801 Old Greenwood Road
         Fort Smith, Arkansas  72903
         Attention:  General Counsel

Subject to the provisions of Section 21 of this Agreement, any notice or demand
authorized by this Agreement to be given or made by the Company or by the holder
of any Right to or on the Rights Agent will be sufficiently given or made if
sent by first-class mail, postage prepaid, addressed (until another address is
filed in writing with the Company) as follows:

         Computershare Investor Services, LLC
         2 North LaSalle Street
         Chicago, Illinois 60602
         Shareholder Services Division
         Attention:  Susan Knaack

Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right will be sufficiently
given or made if sent by first-class mail, postage prepaid, addressed to such
holder at the address of such holder as shown on the registry books of the
Company or the Rights Agent.

         SECTION 26. SUPPLEMENTS AND AMENDMENTS.

         The Company, by Board Approval, and the Rights Agent may from time to
time supplement or amend this Agreement without the approval of any holders of
Rights in order to cure any ambiguity, to correct or supplement any provision
contained in this Agreement that may be defective or inconsistent with any other
provisions in this Agreement, or to make any other provisions in regard to
matters or questions arising under this Agreement that the Company and the
Rights Agent may deem necessary or desirable and that will be consistent with,
and for the purpose of fulfilling, the objectives of the Board of Directors in
adopting this Agreement; provided, however, that following the Distribution
Date, this Agreement may only be amended to shorten or lengthen any time period
or in a manner that would not adversely affect the basic economic terms of the
Rights; provided, further, that, once the Rights are no longer redeemable in
accordance with Section 23 of this Agreement, no amendment to this Agreement may
have the effect of making the Rights redeemable.

                                      -28-
<PAGE>   32

         SECTION 27. SUCCESSORS.

         All the covenants and provisions of this Agreement by or for the
benefit of the Company or the Rights Agent will bind and inure to the benefit of
their respective successors and assigns hereunder.

         SECTION 28. BENEFITS OF THIS AGREEMENT.

         Nothing in this Agreement will be construed to give to any Person other
than the Company, the Rights Agent and the registered holders of the Right
Certificates (and, prior to the Distribution Date, the Common Shares) any legal
or equitable right, remedy or claim under this Agreement; but this Agreement
will be for the sole and exclusive benefit of the Company, the Rights Agent and
the registered holders of the Right Certificates (and, prior to the Distribution
Date, the Common Shares).

         SECTION 29. SEVERABILITY.

         If any term, provision, covenant or restriction of this Agreement is
held by a court of competent jurisdiction or other authority to be invalid, void
or unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and will in
no way be affected, impaired or invalidated.

         SECTION 30. GOVERNING LAW.

         THIS AGREEMENT AND EACH RIGHT CERTIFICATE (AND AFTER THE RECORD DATE
BUT PRIOR TO THE DISTRIBUTION DATE, THE COMMON SHARES) ISSUED UNDER THIS
AGREEMENT WILL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF
DELAWARE AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF SUCH STATE APPLICABLE TO CONTRACTS TO BE MADE AND PERFORMED
ENTIRELY WITHIN SUCH STATE.

         SECTION 31. COUNTERPARTS.

         This Agreement may be executed in any number of counterparts and each
of such counterparts will for all purposes be deemed to be an original, and all
such counterparts will together constitute one and the same instrument.

         SECTION 32. DESCRIPTIVE HEADINGS.

         Descriptive headings of the several sections of this Agreement are
inserted for convenience only and will not control or affect the meaning or
construction of any of the provisions of this Agreement.

         SECTION 33. ESTABLISHMENT OF FUND FOR DIRECTORS. The Board of Directors
may, at any time it deems appropriate, establish or set aside one or more funds,
whether in trust, escrow or otherwise (and regardless of whether such fund is
combined with any other fund established or set aside by the Company), for the
purpose of assuring that adequate resources are

                                      -29-
<PAGE>   33

available to the Board of Directors in order to enable them to carry out their
prescribed functions under this Agreement and to fulfill their fiduciary
obligations to stockholders of the Company.

         SECTION 34. EXCHANGE.

                  (a) The Company may, at its option, at any time and from time
         to time after the first occurrence of a Trigger Event, exchange all or
         part of the then outstanding and exercisable Rights (other than Rights
         that have become void as provided in Section 7(e)) for Common Shares at
         an exchange ratio of one Common Share per Right, appropriately adjusted
         to reflect any stock split, stock dividend or similar transaction
         occurring after May 1, 2001 (such exchange ratio being hereafter
         referred to as the "Exchange Ratio"). Notwithstanding the foregoing,
         the Company will not be empowered to effect such exchange at any time
         after any Person (other than the Company, any Subsidiary of the
         Company, any employee benefit plan of the Company, any such Subsidiary
         or any entity holding shares of Common Stock for or pursuant to any
         such plan), together with all Affiliates and Associates of such Person,
         becomes the Beneficial Owner of 50% or more of the Common Shares then
         outstanding. The exchange of the Rights by the Company may be made
         effective at such time, on such basis and with such conditions as the
         Board of Directors in its sole discretion may establish.

                  (b) Immediately upon the action of the Company ordering the
         exchange of any Rights pursuant to Section 34(a), evidence of which has
         been filed with the Rights Agent, and without any further action and
         without any notice, the right to exercise such Rights will terminate
         and the only right of a holder of such Rights will be to receive that
         number of Common Shares equal to the number of such Rights held by such
         holder multiplied by the Exchange Ratio. Promptly after the action of
         the Company ordering the exchange of the Rights, the Company will (i)
         file evidence of such action with the Rights Agent, (ii) give public
         notice of such exchange; provided, however, that the failure to give,
         or any defect in, such notice will not affect the validity of such
         exchange, and (iii) mail notice of such exchange to the holders of such
         Rights at their last addresses as they appear upon the registry books
         of the Rights Agent. Any notice that is mailed in the manner provided
         in this Section 34(b) will be deemed given, whether or not the holder
         receives the notice. Each such notice of exchange will state the method
         by which the exchange will be effected and, in the event of any partial
         exchange, the number of Rights that will be exchanged. Any partial
         exchange will be effected pro rata based on the number of Rights (other
         than Rights that have become void as provided in Section 7(e)) held by
         each holder of Rights.

                  (c) In lieu of issuing Common Shares in accordance with
         Section 34(a) hereof, the Company may, if the Board of Directors
         determines that such action is necessary or appropriate and not
         contrary to the interests of the holders of Rights, elect to (and, in
         the event that there are not sufficient treasury shares and authorized
         but unissued Common Shares to permit any exchange of the Rights in
         accordance with Section 34(a) hereof, the Company shall) take all such
         action as may be necessary to authorize, issue or pay, upon the
         exchange of the Rights, cash (including by way of a reduction of the
         Purchase Price), property, Common Shares, other securities or any
         combination thereof

                                      -30-
<PAGE>   34

         having an aggregate value equal to the value of the Common Shares which
         otherwise would have been issuable pursuant to Section 34(a) hereof.

                  (d) Upon the action of the Company ordering the exchange of
         any Rights pursuant to Section 34(a), the Company will not be required
         to issue fractions of shares or to distribute certificates which
         evidence fractional shares. In lieu of such fractional shares, the
         Company may pay to the registered holders of the Rights Certificates
         with regard to which such fractional shares would otherwise be issuable
         an amount in cash equal to the same fraction of the current per share
         market price.

                                      -31-
<PAGE>   35

         In Witness Whereof, the parties to this Agreement have caused this
Agreement to be duly executed as of the day and year first above written.

ATTEST:                                      ARKANSAS BEST CORPORATION

By:      /s/ Richard F. Cooper               By: /s/ Robert A. Young, III
         ----------------------------           -------------------------------
         Richard F. Cooper, Secretary           Robert A. Young, III, President

ATTEST:                                      COMPUTERSHARE INVESTOR
                                             SERVICES, LLC

By:      /s/ Tod C. Shafer                   By: /s/ Susan A. Knaack
         ----------------------------           -------------------------------
Name:    Tod C. Shafer                       Name:  Susan A. Knaack
Title:   Group Manager                       Title: Relationship Manager

                                      -32-
<PAGE>   36

                                    EXHIBIT A

                            FORM OF RIGHT CERTIFICATE

No. R-                                                   _______________ Rights

                     NOT EXERCISABLE AFTER APRIL 30, 2011 OR
                    EARLIER IF REDEMPTION OCCURS. THE RIGHTS
                     ARE SUBJECT TO REDEMPTION AT $0.01 PER
                   RIGHT ON THE TERMS SET FORTH IN SECTION 23
                            OF THE RIGHTS AGREEMENT.

                                RIGHT CERTIFICATE

                            ARKANSAS BEST CORPORATION

         This certifies that ________________, or registered assigns, is the
registered owner of the number of Rights set forth above, each of which entitles
the owner, subject to the terms, provisions and conditions of the First Amended
and Restated Rights Agreement, dated as of May 1, 2001 (the "Rights Agreement"),
between Arkansas Best Corporation, a Delaware corporation (the "Company"), and
Computershare Investor Services, LLC, a Delaware limited liability company (the
"Rights Agent"), to purchase from the Company at any time after the Distribution
Date (as such term is defined in the Rights Agreement) and prior to 5:00 P.M.,
Central time, on April 30, 2011 (unless extended or earlier redeemed by the
Company in accordance with the terms of the Rights Agreement) at the
stockholders services office of the Rights Agent, or at the office of its
successor as Rights Agent, one fully paid, nonassessable share of Common Stock,
par value $0.01 per share (the "Common Shares"), of the Company, at a purchase
price of $80.00 (the "Purchase Price") per Right, upon presentation and
surrender of this Right Certificate with the Form of Election to Purchase duly
executed. The number of Rights evidenced by this Right Certificate (and the
number of Common Shares that may be purchased upon exercise of the Rights
evidenced by this Right Certificate) set forth above, and the Purchase Price set
forth above, are the number and Purchase Price as of May 1, 2001 based on the
Common Shares as constituted at such date. As provided in the Rights Agreement,
the Purchase Price and the number of Common Shares that may be purchased upon
the exercise of the Rights evidenced by this Right Certificate are subject to
modification and adjustment upon the happening of certain events.

         This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
incorporated in this Right Certificate by reference and made a part of this
Right Certificate for all purposes and to which Rights Agreement reference is
hereby made for a full description of the rights, limitations of rights,
obligations, duties and immunities under this Right Certificate of the Rights
Agent, the Company and the holders of the Right Certificates. Copies of the
Rights Agreement are on file at the principal executive offices of the Company
and the above-mentioned offices of the Rights Agent.

                                      A-1
<PAGE>   37

         This Right Certificate, with or without other Right Certificates, upon
surrender at the stockholders services office of the Rights Agent, may be
exchanged for another Right Certificate or Right Certificates of like tenor and
date evidencing Rights entitling the holder to purchase a like aggregate number
of Common Shares as the Rights evidenced by the Right Certificate or Right
Certificates surrendered have entitled such holder to purchase. If this Right
Certificate is exercised in part, the holder will be entitled to receive upon
surrender of this Right Certificate another Right Certificate or Right
Certificates for the number of whole Rights not exercised.

         Subject to the provisions of the Rights Agreement, the Rights evidenced
by this Certificate may be redeemed by the Company at a redemption price of
$0.01 per Right.

         No fractional Common Shares will be issued upon the exercise of any
Right or Rights evidenced hereby, but in lieu of such fractional shares, a cash
payment will be made, as provided in the Rights Agreement.

         No holder of this Right Certificate will be entitled to vote or receive
dividends or be deemed for any purpose the holder of the Common Shares or of any
other securities of the Company that may at any time be issuable on the exercise
of the Rights evidenced by this Right Certificate, nor will anything contained
in the Rights Agreement or in this Right Certificate be construed to confer upon
the bolder of this Right Certificate, as such, any of the rights of a
stockholder of the Company or any right to vote for the election of directors or
upon any matter submitted to stockholders at any meeting of stockholders or to
receive notice of meetings or other actions affecting stockholders (except as
provided in the Rights Agreement), or to receive dividends or subscription
rights or otherwise, until the Right or Rights evidenced by this Right
Certificate have been exercised as provided in the Rights Agreement.

         This Right Certificate will not be valid or obligatory for any purpose
until it has been countersigned by the Rights Agent.

         WITNESS the facsimile signature of the proper officers of the Company.
Dated as of ____________________.

ATTEST:                                         ARKANSAS BEST CORPORATION

                                                By:
-------------------------------------              ----------------------------
Countersigned:

COMPUTERSHARE INVESTOR SERVICES, LLC

By:
   ----------------------------------
       Authorized Signature

                                      A-2
<PAGE>   38

                    Form of Reverse Side of Right Certificate

                               FORM OF ASSIGNMENT

                (To be executed by the registered holder if such
               holder desires to transfer the Right Certificate.)

         FOR VALUE RECEIVED ______________________________ hereby sells, assigns
and transfers unto___________________________________

--------------------------------------------------------------------------------
                  (Please print name and address of transferee)

--------------------------------------------------------------------------------
this Right Certificate, together with all right, title and interest in this
Right Certificate, and does hereby irrevocably constitute and appoint Attorney,
to transfer the within Right Certificate on the books of the within-named
Company, with full power of substitution.

Dated:
      -----------------------------

                                             ----------------------------------
                                             Signature

Signature Guaranteed:

         Signatures must be guaranteed by a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc. or a commercial bank or trust company having an office or correspondent in
the United States.

                                      A-3
<PAGE>   39

                          Form of Election to Purchase

                      (To be executed if holder desires to
                      exercise the Right represented by the
                               Right Certificate)

To:  Arkansas Best Corporation

         The undersigned hereby irrevocably elects to exercise ________________
(number) Rights represented by this Right Certificate to purchase the Common
Shares issuable upon the exercise of such Rights and requests that certificates
for such Common Shares be issued in the name of:

Please print social security
or other identifying number
                            ----------------

 ------------------------------------------------------------------------------
                         (Please print name and address)

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

If such number of Rights are not all the Rights evidenced by this Right
Certificate, a new Right Certificate for the balance remaining of such Rights
will be registered in the name of and delivered to:

Please print social security
or other identifying number
                            ----------------

------------------------------------------------------------------------------
                         (Please print name and address)

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

Dated:
        ----------------------

                                         --------------------------------------
                                         Signature

Signature Guaranteed:

         Signatures must be guaranteed by a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc. or a commercial bank or trust company having an office or correspondent in
the United States.

                                      A-4

<PAGE>   40

                                     NOTICE

         The signature in the foregoing Forms of Assignment and Election must
conform to the name as written upon the face of this Right Certificate in every
particular, without alteration or enlargement or any change whatsoever.

                                      A-5
<PAGE>   41

                                    EXHIBIT B

                          SUMMARY OF RIGHTS TO PURCHASE
                SHARES OF ARKANSAS BEST CORPORATION COMMON STOCK

         The Board of Directors of Arkansas Best Corporation (the "Company")
issued one common share purchase right (a "Right") for each outstanding share of
common stock, par value $0.01 per share (the "Common Shares"), of the Company
issued and outstanding on the closing date of the Company's initial public
offering (the "Record Date"). Each Right entitles the registered holder to
purchase from the Company one Common Share at a price of $80.00 (the "Purchase
Price"), subject to adjustment.

         The Rights were issued pursuant to the Rights Agreement, dated as of
April 23, 1992 (the "Original Rights Agreement"), by and between the Company and
Harris Trust and Savings Bank. The Original Rights Agreement was amended on May
27, 1999 by an Amendment to Rights Agreement and was amended and restated by the
First Amended and Restated Rights Agreement, dated May 1, 2001 (the "Restated
Rights Agreement"), by and between the Company and Computershare Investor
Services, LLC, a Delaware limited liability company, as successor Rights Agent.
The Restated Rights Agreement amended the Original Rights Agreement (as
previously amended) to, among other things, extend the term of the Rights
Agreement to April 30, 2011 and increase the Purchase Price to $80.00 per Common
Share. The Original Rights Agreement and the Restated Rights Agreement are
sometimes referred to together as the "Rights Agreement."

         The description and terms of the Rights are set forth in the Restated
Rights Agreement.

         Until the earlier to occur of (i) 10 days following a public
announcement that a person or group of affiliated or associated persons has
acquired, or obtained the right to acquire, beneficial ownership of 15% or more
of the outstanding Common Shares (an "Acquiring Person"), except that the term
"Acquiring Person" shall not include the Company, any subsidiary of the Company,
any employee benefit plan of the Company or any such subsidiary or any person
who acquires beneficial ownership of the Common Shares in a Permitted
Transaction (as such term is described below), (ii) 15 business days (or such
later date as may be determined by action of the Board of Directors prior to any
person becoming an Acquiring Person) following the commencement of, or public
announcement of an intention to commence, a tender offer or exchange offer, the
consummation of which would result in the beneficial ownership by a person or
group of affiliated or associated persons of 19.9% or more of the outstanding
Common Shares or (iii) 10 days after the Board of Directors determines that any
person (other than Robert A. Young, III) or group of persons (an "Adverse
Person") has acquired beneficial ownership of a substantial amount of Common
Shares (but not less than 10% of the outstanding Common Shares) and that (a)
such Adverse Person intends to cause the Company to repurchase such Common Stock
or to exert pressure against the Company to take any actions or enter into any
transactions to provide such Adverse Person with short-term gains or profits
under circumstances in which the Board of Directors determines that the
long-term interests of the Company and its stockholders would not be served by
taking such actions or entering into such transactions or (b) beneficial
ownership by such Adverse Person is reasonably likely to have a material adverse
effect on the business, competitive position, prospects or financial condition
of the Company and

                                      B-1
<PAGE>   42

its subsidiaries (the earlier of such dates being the "Distribution Date"), the
Rights associated with Common Shares represented by certificates outstanding on
the Record Date will be evidenced by such certificates with a copy of the
Summary of Rights from the Original Rights Agreement attached to the
certificate.

         The Rights Agreement provides that, until the Distribution Date, the
Rights will be transferred with and only with the Common Shares to which they
are associated. Until the Distribution Date (or earlier redemption or expiration
of the Rights), the Rights associated with Common Shares represented by
certificates issued after the Record Date (whether upon transfer or new issuance
of Common Shares) will contain a notation incorporating the Rights Agreement by
reference. Until the Distribution Date (or earlier redemption or expiration of
the Rights), the surrender for transfer of any certificate for Common Shares
outstanding will constitute the transfer of the Rights associated with the
Common Shares represented by such certificate. As soon as practicable following
the Distribution Date, separate certificates evidencing the Rights (the "Right
Certificates") will be mailed to holders of record of the Common Shares as of
the close of business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.

         The Rights are not exercisable until the Distribution Date. The Rights
will expire on April 30, 2011 (the "Final Expiration Date"), unless the Final
Expiration Date is extended or unless the Rights are earlier redeemed by the
Company, in each case, as described below.

         The Purchase Price payable and the number of Common Shares or other
securities or property issuable upon exercise of the Rights are subject to
adjustment from time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of, the Common
Shares, (ii) upon the grant to holders of the Common Shares of certain rights or
warrants to subscribe for or purchase Common Shares at a price or securities
convertible into Common Shares with a conversion price less than the then
current market price of the Common Shares, or (iii) upon the distribution to
holders of the Common Shares of evidences of indebtedness or assets or of
subscription rights or warrants (other than those referred to above).

         In the event that (i) the Company is the surviving corporation in a
merger with an Acquiring Person or Adverse Person and the Common Shares are not
changed or exchanged, (ii) an Acquiring Person or Adverse Person engages in
certain self-dealing transactions with the Company, (iii) any person becomes the
beneficial owner of 19.9% or more of the outstanding Common Shares (unless the
event in which such person acquired 19.9% or more of the outstanding Common
Shares is a Permitted Transaction), (iv) the Company engages in a
reclassification or recapitalization that results in an increase of more than 1%
of an Acquiring Person's or Adverse Person's percentage ownership of the Company
or (v) the Board of Directors declares any person to be an Adverse Person, the
proper provision will be made so that each holder of a Right, other than Rights
beneficially owned by an Acquiring Person or an Adverse Person (which will then
be void), will have the right to receive upon exercise that number of Common
Shares having a market value of two times the applicable exercise price of the
Right.

                                      B-2
<PAGE>   43

         For the purposes of the Rights Agreement, a Permitted Transaction is a
stock acquisition or tender or exchange offer pursuant to a definitive agreement
which would result in a person beneficially owning 50% or more of the Common
Shares and which was approved by the Board of Directors prior to the execution
of the agreement or the public announcement of the offer.

         In the event that the Company is acquired in a merger or other business
combination transaction (other than with a subsidiary of the Company), or 50% or
more of its consolidated assets or earning power are sold, unless such event is
a Permitted Transaction, proper provisions will be made so that each holder of a
Right will have the right to receive, upon the exercise of the Right at the then
applicable exercise price, that number of shares of common stock of the
acquiring company that at the time of such transaction will have a market value
of two times the applicable exercise price of the Right.

         With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least l% in
such Purchase Price. No fractional Common Shares will be issued and in lieu of
such fractional shares, an adjustment in cash will be made based on the market
price of the Common Shares on the last trading day prior to the date of
exercise.

         At any time prior to the tenth day following the public announcement
that a person has become an Acquiring Person, the Board of Directors of the
Company may redeem the Rights in whole, but not in part, at a price of $0.01 per
Right (the "Redemption Price"). In addition, the Board of Directors may extend
or reduce the period during which the Rights are redeemable, so long as the
Rights are redeemable at the time of such extension or reduction. Immediately
upon any redemption of the Rights, the right to exercise the Rights will
terminate and the only right of the holders of Rights will be to receive the
Redemption Price.

         The terms of the Rights may be amended by the Board of Directors of the
Company without the consent of the holders of the Rights, including an amendment
to extend the Final Expiration Date, except that from and after the Distribution
Date no such amendment may adversely affect the economic interests of the
holders of the Rights.

         Until a Right is exercised, the holder of the Right, as such, will have
no rights as a stockholder of the Company, including, without limitation, the
right to vote or to receive dividends.

                                      B-3

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