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                                                                   Exhibit 10.12

                         Annual Incentive Plans Summary

The Spiegel Group
The Spiegel Group annual incentive plan is designed to provide compensation in
addition to base pay for certain eligible associates based upon The Spiegel
Group financial results. Payment under the plan is based consolidated Earnings
Before Taxes (EBT) results on a blended basis as follows:

         Spiegel Group Component                     Relative Weighting
         Eddie Bauer                                        30%
         Spiegel Catalog                                    25%
         First Consumers National Bank                      25%
         Newport News, Inc.                                 20%

The plan establishes a minimum, target and maximum EBT goals the achievement of
which results in a payout ranging from 50% to 150% of the participant's
incentive percentage. Each division's EBT is calculated independently and may
provide payment despite other divisions not meeting their designated targets.
Executives eligible for payout under this plan include but are not limited to
Mr. Zoepfell, Vice Chairman, President and Chief Executive Officer of The
Spiegel Group and Mr. Cannaturo, Executive Vice President, Chief Financial
Officer of The Spiegel Group.

Spiegel Catalog
The Spiegel Catalog annual incentive plan is designed to provide compensation in
addition to base pay for certain eligible associates based solely upon Spiegel
Catalog financial performance. Payment under the plan occurs when the Company
reaches designated Earnings Before Taxes (EBT) targets. The plan establishes a
minimum, target and maximum EBT goals the achievement of which results in a
payout ranging from 50% to 150% of the participant's incentive percentage.
Executives eligible for a payment under this plan include but are not limited to
Ms. Payner, President and Chief Executive Officer of Spiegel Catalog.

Eddie Bauer Eddie Bauer's annual incentive plan is designed to provide
compensation in addition to base salary for certain eligible associates. Both
individual performance and company results impact payment under the plan. The
company must meet their threshold EBT performance before eligible associates may
receive payment under the portion of the plan that relates to company
performance. Increased payment of up to 150% occurs if the company meets target
or maximum EBT performance levels. Participant's performance is measured against
the deliverables and key objectives established in the participants annual
performance plan. The individual performance component provides increasing
payment using a rating scale of 0-5 to evaluate performance results achieved
against a participants performance plan.

Distribution Fulfillment Services (DFS)
The DFS Management Bonus plan is designed to provide compensation in addition to
base salary for certain eligible associates. Payout is based on a combination of
the financial results for Operating and Transportation. Operating financial
results account for 75% of the bonus and are measured by EBT targets established
annually. Transportation earnings account for the remaining 25% of the bonus
payout. The plan establishes a minimum, target and maximum EBT goals the
achievement of which results in a payout ranging from 50% to 150% of the
participant's incentive percentage.

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Long Term Incentive Plan Summary
The Spiegel Group Long-Term Incentive Plan (LTIP) is intended to emphasize and
reward total corporate performance over the long term. Participants are assigned
a Target Opportunity Value expressed as a percentage of their base salary. The
Target Opportunity Value is allocated between two separate but related
components: stock option grants and a cash based Long-Term Incentive Plan.
Approximately 80% is allocated to cash with the remaining 20% allocated through
a fixed number of stock options based on level.

The current plan covers the financial periods, 2000-2001 and 2000-2002. The plan
cycles overlap, providing financial targets and award opportunities each year.
The cash component is based on a measurement of adjusted Earnings Before Taxes
(EBT) for The Spiegel Group.