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                                                                   EXHIBIT 10q

                                SECOND AMENDMENT
                                       TO
                              EMPLOYMENT AGREEMENT

            This SECOND AMENDMENT TO THE EMPLOYMENT AGREEMENT, made and entered
into by and between KMART CORPORATION, a Michigan corporation (together with its
successors and assigned permitted under this Agreement, the Company"), and
CHARLES C. CONAWAY (the "executive") effective as of the _____ day of November
2001.

            WHEREAS, the Executive has entered into an employment agreement with
the Company, dated as of May 30, 2000, and amended as of May 15, 2001
(collectively, the "Employment Agreement"), pursuant to which the Executive
serves the Company as it Chief Executive Office and Chairman;

            WHEREAS, the Company has determined that it is appropriate and in
the best interest of the shareholders of the Company to further amend the
Employment Agreement with the Executive in order to clarify certain provisions
of the Employment Agreement and to provide for consistency of benefits between
the Executive and other senior executives of the Company; and

            WHEREAS, the Executive desires to amend the Employment Agreement as
set forth herein to reflect such clarifications and modifications.

            NOW, THEREFORE, in consideration of the premises and the mutual
agreements hereinafter contained, the parties do hereby amend the Employment
Agreement as follows, effective as of the date hereof:

            1. Section 8(C)of the Employment Agreement is hereby amended to read
in its entirety as follows:

            "(c) The Company acknowledges its obligation to provide the
            Executive with transportation during the Employment Period that
            provides him with security to address bona fide business-oriented
            security concerns, and shall, at Company expense, make available to
            the Executive (and his family when traveling with him), Company or
            other private aircraft for business and personal use at his
            discretion, provided that any such personal use shall be limited to
            travel within the United States. It is recognized that the
            Executive's travel by Company or other private aircraft is required
            for security purposes and, as such, all uses by the Executive
            (including uses with his family) will constitute business use of the
            aircraft and shall not be subject to reimbursement by the Executive.
            The Company shall provide additional payments to the Executive on a
            fully grossed up basis to cover applicable federal, state and local
            income and excise taxes, when and to the extent, if any, that such
            taxes are payable by the Executive, including, without limitation,
            any tax imposed
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            by Section 4999 of the Code or any similar tax, with respect to the
            foregoing aircraft usage."

            2. The fourth and fifth paragraphs of Section 6(c) of the Employment
Agreement are deleted and replaced by the following paragraphs:

            "The Company shall provide additional payments to the Executive on a
            fully grossed up basis to cover applicable federal, state and local
            income and excise taxes, when and to the extent, if any, that such
            taxes are payable by the Executive upon the forgiveness of principal
            or interest under the Loan, including, without limitation, any tax
            imposed by Section 4999 of the Code or any similar tax and any
            related interest and penalties in the event that the Internal
            Revenue Service determines at any time that principal or interest
            under the Loan should be taken into account as taxable income by the
            Executive at the time the Loan is entered into.

            In the event that the Internal Revenue Service determines at any
            time that principal or interest under the Loan should be taken into
            account as taxable income by the Executive at the time it is entered
            into, any resulting tax, including any resulting state and local
            taxes (collectively "Associated Taxes"), and any related interest
            and penalties, will be either paid by the Company directly to the
            IRS or to the Executive, at his election, when due. In addition, the
            Company shall make additional payments to the Executive to hold him
            harmless from: (I) any tax liabilities attributable to its payment
            of any related interest and penalties, and (ii) any imputed income
            associated with interest-free component of the Executive's repayment
            obligation referred to in this Agreement (the "Hold Harmless
            Payments").

            Should the Company wish to contest with the IRS the accelerated
            inclusion of such income or any related to penalties, interest or
            the Hold Harmless Payments, then the Executive shall reasonably
            cooperate with the Company as to such contest, and at the time they
            are then due, Company shall pay to the IRS (or at his election to
            the Executive) the Associated Taxes, and any related interest and
            penalties, and to the Executive, the Hold Harmless Payments. Any
            such Associated Taxes shall be repaid by the Executive to the
            Company (without interest), if and when the Loan is otherwise
            repayable by the Executive."


            3. Defined Terms used herein and not otherwise defined in this
Amendment shall have the same meaning as when used under the Employment
Agreement.

            4. Except as amended and modified hereby, the terms of the
Employment Agreement shall remain in full force and effect.


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            IN WITNESS WHEREOF, the parties hereto have entered into the First
Amendment to Employment to Agreement as of the day and year first written above.

                                            EXECUTIVE

                                            /s/ Charles C. Conaway
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                                            Charles C. Conaway


                                            KMART CORPORATION

                                            *
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                                            By:
                                               ---------------------------------
                                            Title:
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