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                                                                    EXHIBIT 10.2





                              CALIBER SYSTEM, INC.
                           DEFERRED COMPENSATION PLAN
                            EFFECTIVE OCTOBER 1, 1997

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                                TABLE OF CONTENTS

PURPOSE                                                           2
                                                               
DEFINITION                                                        2
                                                               
   PARTICIPATION                                                  4
   Enrollment                                                     5
   Balances from Prior Plans                                      5
   Employer Matching Credits                                      5
   Determination of Earnings                                      5
   Statement of Accounts                                          6
   Conversion of Caliber Common Stock                             6
                                                               
DISTRIBUTIONS                                                     6
   Employer Matching Account                                      6
   Prior Plan Account                                             7
   Deferral Account                                               7
   Disability Benefit                                             7
   Hardship Withdrawal                                            7
   Special Election for Early Distribution                        7
   Death Benefit                                                  7
                                                               
FUNDING OF BENEFITS                                               7
                                                               
ADMINISTRATION OF THE PLAN                                        7
   The Committee                                                  7
   Expenses of the Committee                                      8
   Bonding and Compensation                                       8
   Information Submitted to the Committee                         8
   Notices, Statements and Reports                                8
   Insurance                                                      8
   Indemnity                                                      9
                                                               
CLAIMS PROCEDURE                                                  9
   Filing Claim for Benefits                                      9
   Appeals Procedure                                             10
                                                               
AMENDMENT, TERMINATION OR SUSPENSION                             10
                                                               
MISCELLANEOUS                                                    11
   Participant Rights                                            11
   Alienation                                                    11
   Partial Invalidity                                            11
   Choice of Law                                                 11
   Share Available Under Plan                                    11
   Adjustments                                                   11
   Payment to Minors                                             12
   Inability to Locate                                           12
   Successors                                                    12
   Gender, Tense and Headings                                    12
                                                       

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                     CALIBER SYSTEM, INC, DEFERRED COMPENSATION PLAN

This Deferred Compensation Plan (hereinafter referred to as the "Plan") has been
adopted by the Board of Directors of Caliber System Inc. (hereinafter referred
to as the "Company"), effective as of October 1, 1997 (the "Effective Date").

I.       PURPOSE

         The purpose of the Plan is to provide supplemental retirement income
         and death benefits for a select group of key management employees of
         the Employer.

II.      DEFINITIONS

         The following definitions, set forth in alphabetical order, are used
         throughout the Plan. Whenever words or phrases have initial capital
         letters in the Plan, a special definition for those words or phrases is
         set forth below.

         A.       "Account" means the record maintained by the Committee of each
                  Participant's interest in the Plan. The Account may consist of
                  the "Deferral Account", the "Employer Matching Account", the
                  "Prior Plan Account", and such other accounts as the Committee
                  shall designate.

         B.       "Beneficiary" means the person, persons or entity designated
                  in writing by the Participant on forms provided by the
                  Committee to receive distribution of his Account balance in
                  the event of the Participant's death. A Participant may change
                  the designated Beneficiary from time to time by filing a new
                  written designation with the Committee, and such designation
                  shall be effective upon receipt by the Committee. If a
                  nonspouse beneficiary is named to receive more than 50% of the
                  Account, the spouse of the Participant must sign a form
                  indicating approval. If a Participant has not designated a
                  Beneficiary, or if a designated Beneficiary is not living or
                  in existence at the time of a Participant's death, any death
                  benefits payable under the Plan shall be paid to the
                  Participant's spouse, if then living, and if the Participant's
                  spouse is not then living, to the Participant's estate.

         C.       "Board of Directors" means the Board of Directors of the
                  Company.

         D.       "Caliber Common Stock" means common stock of the Company.

         E.       "Caliber Stock Fund" means the Fund deemed to be invested in
                  Caliber Common Stock. If, as a result of a merger,
                  acquisition, sale or other disposition of substantially all
                  the assets of the Company, Caliber Common Stock is no longer
                  traded on a national securities exchange, the Caliber Stock
                  Fund shall be deemed to be invested in shares of common stock
                  of the entity resulting from such transaction.

         F.       "Code" means the Internal Revenue Code of 1986, as amended,
                  and the rules and regulations thereunder.

         G.       "Committee" means the Compensation Committee of the Board of
                  Directors of the Company, which will be responsible for
                  oversight of this Plan. The Committee is authorized to
                  delegate any or all of its authority from time to time in
                  writing.

         H.       "Company" means Caliber System, Inc., or any successor
                  thereto.

         I.       "Compensation" means cash or other property payable with
                  respect to a Plan Year to a Participant under any agreement,
                  plan, program or arrangement of an Employer, including base
                  salary, annual incentive compensation and extraordinary
                  bonuses, including bonuses or other amounts paid in lieu of
                  amounts under a Participant's Management Retention Agreement
                  (or other similar agreement).

         J.       "Deferral Account" means the record maintained by the
                  Committee credited with each Participant's deferred
                  Compensation and showing payments and withdrawals therefrom
                  and the amount of income, expenses, gains and losses
                  attributable thereto.


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         K.       "Deferral Agreement" means an agreement by a Participant to
                  have a specified percentage or dollar amount of his
                  Compensation deferred under the Plan for a specified period in
                  the future.

         L.       "Determination Date" means the last day of each calendar month
                  or such other date as designated by the Company in accordance
                  with Section III(D)(6).

         M.       "Disabled" means disabled as defined under the Employer's long
                  term disability plan applicable to the Participant.

         N.       "Employer" means Caliber System, Inc. RPS, Inc., Caliber
                  Technology, Inc., Viking Freight, Inc., Caliber Logistics,
                  Inc. and affiliates, and Roberts Express, Inc.

         0.       "Employer Matching Account" means the record maintained by the
                  Committee of each Participant's Employer Matching Credit,
                  showing payments and Withdrawals therefrom and the amount of
                  income, expenses, gains and losses attributable thereto.

         P.       "Employer Matching Credit" means the matching credits
                  described in Section III(C).

         Q.       "ERISA" means the Employee Retirement Income Security Act of
                  1974, as amended.

         R.       "Funds" means the hypothetical investment options made
                  available to the Participant which shall be used as deemed
                  earnings indices for credits to a Participant's Account. The
                  Committee will determine the Funds which will be available
                  from time to time.

         S.       "Participant" means a key management employee of an Employer
                  who has been specifically designated by the Board of Directors
                  as eligible to make deferrals of Compensation to the Plan or
                  any former employee of an Employer on whose behalf amounts
                  attributable to Prior Plans have been transferred to the Plan.

         T.       "Plan Interest Rate" means for any month the rate of return
                  equal to that which would have been generated had a
                  Participant's Account actually been invested in the Fund or
                  Funds (other than the Caliber Stock Fund) designated by the
                  Participant for such month net of investment-related charges.
                  No provision of this Plan shall be construed as giving any
                  Participant an interest in any of these Funds nor shall any
                  provision require that the Company make any investment in any
                  such Funds.

         U.       "Plan Year" means the calendar year. The initial Plan Year,
                  however, will be October 1, 1997 through December 31, 1997.

         V.       "Prior Plan Account" means the record maintained by the
                  Committee credited with each Participant's balance rolled into
                  the Plan from one or more Prior Plans and showing payments and
                  withdrawals therefrom and the amount of income, expenses,
                  gains and losses attributable thereto.

         W.       "Prior Plans" means the Caliber System, Inc. Long-Term Stock
                  Award Incentive Plan; the Roadway Services, Inc. Stock Credit
                  Plans; the Stock Credit Method Plan, the Spartan Express, Inc.
                  Stock Credit Plan, the Roberts Transportation, Inc. Stock
                  Credit Plan, the Roadway Logistics Systems, Inc. Stock Credit
                  Plan; the Viking Freight, Inc. Stock Credit Plan for 1990.

         X.       "Retirement" means a Participant's termination of employment
                  with an Employer following attainment of age 55 with five (5)
                  or more years of service with the Employers and any
                  predecessor of an Employer.

         Y.       "Retirement Date" means the first day of the month coinciding
                  with or next following Retirement.

         Z.       "Termination" means a Participant's termination of employment
                  with an Employer for reasons other than Retirement, disability
                  or death.


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         AA.      "Termination Date" means the date on which the Participant's
                  employment with an Employer is terminated for reasons other
                  than Retirement, disability or death.

III.     PARTICIPATION

         A.       ENROLLMENT

         A Participant may elect to defer Compensation by delivering an executed
         Deferral Agreement to the Committee in accordance with the following
         provisions:

         1.       Each Participant who is eligible must delivering an executed
                  Deferral Agreement to the Committee no later than September
                  30, 1997 in order to be able to elect to defer all or any
                  portion of base salary October 1, 1997 and/or all or any
                  portion of annual incentive compensation that may become
                  payable for 1997.

         2.       For subsequent Plan Years, in order to defer all or any
                  portion of his base salary, a Participant must deliver an
                  executed Deferral Agreement to the Committee prior to the
                  first day of the Plan Year from which such Compensation is to
                  be deferred.

         3.       For subsequent Plan Years, in order to defer all or any
                  portion of his annual incentive compensation, a Participant
                  must deliver an executed Deferral Agreement to the Committee
                  prior to the first day of July of any Plan Year.

         4.       In order to defer all or any portion of his Compensation other
                  than base salary or incentive compensation a Participant must
                  deliver an executed Deferral Agreement to the Committee in
                  accordance with procedures established by the Committee for
                  such deferrals.

         5.       A Participant who first becomes eligible to make deferrals of
                  Compensation to the Plan during a Plan Year may, within 3O
                  days after he becomes a Participant, elect to participate in
                  the Plan for such Plan Year by delivering an executed Deferral
                  Agreement to the Committee and his Deferral Agreement will be
                  effective only with regard to Compensation earned or that
                  becomes determinable and payable during the Plan Year
                  following the delivery of the Deferral Agreement with the
                  Committee.

         6.       Participants shall make the following elections on each
                  Deferral Agreement:

                  a.       The amount to be deferred with respect to each
                           component of his Compensation.

                           Participants may elect to defer all or any portion of
                           his Compensation in one percent (1%) increments.
                           Deferral elections are irrevocable.

                  b.       The distribution date with respect to deferrals
                           covered by the Deferral Agreement, pursuant to
                           Section IV(C).

                           The distribution date specified by the Participant
                           must not be less than three years from the end of the
                           Plan Year for which the deferral is made and no later
                           than Retirement. Thereafter, a Participant may make a
                           one-time election to change the distribution date to
                           a later date, change the form of payment from a lump
                           sum to installments and/or increase the number of
                           installments, provided that such election shall not
                           be effective unless the Committee receives the
                           election at least one year and one day before the
                           distribution date initially elected.

                  C.       The form of distribution to be made to the
                           Participant at the end of the deferral period,
                           pursuant to Section IV(C).

                           Payment of the Participant's Deferral Account may be
                           made in a single lump sum or in annual installments
                           of up to ten years, adjusted each year to reflect the
                           earnings credited or debited to such Account. The
                           annual payment will be a fraction of a Participant's
                           Account balance based on the number of payment years
                           elected. (Example: over a ten year period, 1/10 of
                           the balance would be paid in the first year, 1/9 in
                           the second year, etc.)



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B.       BALANCES FROM PRIOR PLANS

         Balances as of December 31, 1997 from Prior Plans will be transferred
         into this Plan effective January 1, 1998 and credited to a
         Participant's Prior Plan Account. Prior Plan Accounts will at all times
         be subject to the vesting and distribution provisions of the applicable
         Prior Plan. The Prior Plan Account shall be deemed to be invested in
         the Caliber Stock Fund. Participants may not reallocate investment of
         their Prior Plan Account into other Funds. All or a portion of the
         Prior Plan Account may be withdrawn pursuant to Section IV(E) (Hardship
         Withdrawal), but may not be withdrawn pursuant to Sections IV(G)(Early
         Distributions).

C.       EMPLOYER MATCHING CREDITS

         Beginning January 1, 1998, Employer Matching Credits will be credited
         (as described below) as follows:


         The first Component is equal to the "matching percentage" (50%, as of
         the Effective Date) set forth in the Caliber System, Inc. 401(k)
         Savings Plan (the "Savings Plan"), multiplied by each dollar
         contributed to the Plan up to 7% (6% for officers of Viking Freight,
         Inc.) of the Participant's base salary and incentive compensation
         payable during such Plan Year without regard to deferrals into other
         plans maintained by the Company, reduced by the amount of matching
         contributions credited to the Participant's account in the Savings Plan
         for the same period.

         The second component is equal to the Participant's base salary and
         annual incentive bonus that is in excess of the Code Section 401
         (a)(17) limit multiplied by the current year allocation percentage in
         the Caliber System, Inc. Stock Bonus Plan.

         The Employer Matching Credit will be credited to the Employer Matching
         Account of each Participant who is employed by any affiliate of the
         Company on the last day of the Plan Year to which such Credit applies,
         or who terminated employment during such Plan Year as a result of
         death, Retirement, becoming Disabled or in connection with a "Change in
         Control" (as defined in Section VIII(A)) annually on December 31 as
         units of Caliber Common Stock. The number of units shall be determined
         by dividing the Employer Matching Credit by the average of the fair
         market value of Caliber Common Stock on the last business day of each
         month in the Plan Year.

         The Employer Matching Account shall be deemed to be invested in the
         Caliber Stock Fund. Participants may not reallocate this Account into
         other Funds, and amounts may not be withdrawn pursuant to Sections
         IV(F) (Early Distributions).

D.       DETERMINATION OF EARNINGS

         All amounts deferred pursuant to a Deferral Agreement during a calendar
         month will be credited to a Participant's Account on the fifteenth day
         of the month in which the deferral is made. Distributions are deducted
         as of the first day of the month in which the distribution occurs.

         I.       A Participant must make an investment election at the time of
                  his initial Deferral Election. The investment election shall
                  designate the portion of the amounts deferred which are to be
                  treated as invested in each available Investment Fund. A
                  Participant's investment election shall remain in effect with
                  respect to each subsequent deferral until the Participant
                  files a change in investment election with the Committee. A
                  Participant may change his investment election either with
                  respect to amounts deferred following the change in investment
                  election or with respect to the deemed investment allocation
                  of the Participant's existing Account, as the Participant may
                  elect. A change in election must be filed with the Committee
                  on a form prescribed by the Committee. A change in investment
                  election will become effective on the first business day of
                  the calendar month next following the Committee's receipt of
                  the change in investment election; provided that the Committee
                  receives the change in investment election no later than the
                  15th day of such month. All investment elections by a
                  Participant shall be subject to approval by the Committee.


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                  2.       If the Committee receives an initial investment
                           preference which it determines to be incomplete,
                           unclear or improper, the Participant shall be deemed
                           to have filed no investment preference and his
                           Account will be deemed to be invested in a
                           conservative fund selected by the Committee. If the
                           Committee receives a revised investment preference
                           which it determines to be incomplete, unclear or
                           improper, the Participant's investment preference
                           then in effect, shall remain in effect until a proper
                           investment preference is received by the Committee.

                  3.       All investment elections shall be advisory only and
                           shall not bind the Company. The Company shall not be
                           obligated to invest any funds or purchase any shares
                           in connection with this Plan. If however, the Company
                           chooses to invest funds to provide for its
                           liabilities under this Plan, the Company shall have
                           complete discretion.

                  4.       As of each Determination Date, the Participant's
                           Deferral Account will be credited with the Plan
                           Interest Rate realized since the immediately
                           preceding Determination Date. Amounts credited to
                           each Participant's Deferral Account shall be
                           determined based upon the balance of the
                           Participant's Deferral Account as of the immediately
                           preceding Determination Date with appropriate
                           adjustments for credits of deferrals and
                           distributions as specified in Section III(D) since 
                           the immediately preceding Determination Date. 
                           Dividends on Caliber Common Stock shall be converted
                           to deemed shares of Caliber Common Stock based on 
                           the closing price of Caliber Common Stock on the 
                           dividend payment date.

                  5.       Dividends on Caliber Common Stock in the
                           Participant's Employer Matching Account and Prior
                           Plan Account shall be converted to deemed shares of
                           Caliber Common Stock based on the closing price of
                           Caliber Common Stock on the dividend payment date.

                  6.       If it is determined that the constructive value of an
                           Account as of any date on which distributions are to
                           be made differs materially from the constructive
                           value of the Account on the prior Determination Date
                           upon which the distribution is to be based, the
                           Committee, in its discretion, shall have the right to
                           designate any date in the interim as a Determination
                           Date for the purpose of constructively revaluing the
                           Account so that the Account from which the
                           distribution is being made will, prior to the
                           distribution, reflect its share of such material
                           difference in value. Similarly, the Committee may
                           adopt a policy of providing for regular interim
                           valuations without regard to the materiality of
                           changes in the value of the Accounts.

         E.       STATEMENT OF ACCOUNTS

                  Within a reasonable time after the end of each calendar
                  quarter of the Plan Year, the Committee shall submit to each
                  Participant a statement showing the status of his Account.

         F.       CONVERSION OF CALIBER COMMON STOCK

                  If as a result of a merger, acquisition, sale or other
                  disposition of substantially all the assets of the Common
                  Stock is no longer traded on a national securities exchange,
                  the deemed shares of Caliber Common Stock in the Caliber Stock
                  Fund shall be converted (on such basis as the Committee shall
                  determine) and deemed to be invested in shares of common stock
                  of the entity resulting from such transaction.

IV.      DISTRIBUTIONS

         All distributions, other than from the Caliber Stock Fund, shall be in
         cash. Distributions of the Caliber Stock Fund shall be paid in shares
         of Caliber Common Stock; however, the Committee may, in its sole
         discretion, pay all or a portion of the distribution payable from the
         Caliber Stock Fund in cash. Distributions shall be subject to
         applicable federal, state, and local withholding for taxes.

         A.       The Employer Matching Account will be paid commencing on
                  February 1 of the year following Retirement in five annual
                  installments. A Participant who terminates employment prior to
                  being eligible for Retirement shall receive a payout of his
                  Employer Matching Account in a single lump sum no later than
                  ninety (90) days following his Termination Date.

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         B.       PRIOR PLAN ACCOUNT

                  Balances transferred from Prior Plans will be paid in
                  accordance with the payment provisions of Prior Plans.

         C.       DEFERRAL ACCOUNT

                  Subject to the provisions of Section III(A)(6)(b), a
                  Participant's Deferral Account shall be distributed in
                  accordance with the election made on the Participant's
                  Deferral Agreement(s) no later than ninety (90) days following
                  the date(s) specified therein; provided, however, that if a
                  Participant's Termination Date is earlier, distribution will
                  be made in a single lump sum no later that ninety (90) days
                  following his Termination Date.

         D.       DISABILITY BENEFIT

                  If a Participant becomes Disabled as defined in Section II(M),
                  his Account will be paid in a lump sum or a series of up to
                  ten annual payments, as elected by the Participant at the time
                  disability is determined.

         E.       HARDSHIP WITHDRAWAL

                  At any time prior to the commencement of benefits hereunder, a
                  Participant may request in writing that the Committee make a
                  distribution to him from his Account balance due to the
                  unforeseeable financial emergency of the Participant. In the
                  event the Committee determines, in its sole discretion, that
                  the Participant is eligible for a distribution under this
                  Section, the distribution shall be made as soon as practicable
                  following the Committee's determination and may not exceed the
                  amount needed to satisfy the immediate and heavy financial
                  hardship of the Participant.

         F.       SPECIAL ELECTION FOR EARLY DISTRIBUTION

                  A Participant may at any time elect to withdraw all or any
                  part of his Account, excluding amounts from the Employer
                  Matching Account and the Prior Plan Account, less a 10%
                  withdrawal penalty (in addition to any applicable tax
                  withholding). A Participant who elects a withdrawal under this
                  Section shall be prohibited from deferring Compensation
                  pursuant to this Plan for three years following the date of
                  the withdrawal.

         G.       DEATH BENEFIT

                  Following the death of a Participant, the Beneficiary shall
                  receive a lump sum distribution of the Account within 60 days
                  following the death of the Participant.

V.       FUNDING OF BENEFITS

         The Plan shall be considered unfunded at all times. All benefits
         payable under the Plan shall be paid from the Company's general assets,
         and nothing contained in the Plan shall require the Company to set
         aside or hold in trust any funds for the benefit of a Participant or
         his Beneficiary. All Participants shall have the status of a general
         unsecured creditor with respect to the Company's obligation to make
         payments under the Plan. However, the Company retains the right to
         establish a trust and fund a trust at its discretion. Any funds of the
         Company available to pay benefits under the Plan shall be subject to 
         the claims of general creditors of the Company.

VI.      ADMINISTRATION OF THE PLAN

         A.       THE COMMITTEE

                  The Committee shall be responsible for the administration of
                  the Plan and shall keep a written record of its actions and
                  proceedings regarding the Plan and all dates, records and
                  documents relating to its administration of the Plan.

                  The Committee is authorized to interpret the Plan, to make,
                  amend and rescind such rules as it deems necessary for the
                  proper administration of the Plan, to make all other
                  determinations


                                        7


<PAGE>   9


                  necessary or advisable for the administration of the Plan and
                  to correct any defect or supply any omission or reconcile any
                  inconsistency in the Plan in the manner and to the extent that
                  the Committee deems desirable to carry the Plan into effect.
                  The powers and duties of the Committee shall include, without
                  limitation, the following:

                  1.       Resolving all questions relating to the eligibility
                           of employees to become Participants;

                  2.       Determining the amount of benefits payable to
                           Participants or their Beneficiaries and authorizing
                           and directing the Company with respect to the payment
                           of benefits under the Plan;

                  3.       Construing and interpreting the Plan whenever
                           necessary to carry out its intention and purpose and
                           making and publishing such rules for the regulation
                           of the Plan as are not inconsistent with the terms of
                           the Plan;

                  4.       Compiling and maintaining all records it determines
                           to be necessary, appropriate or convenient in
                           connection with the administration of the Plan; and

                  5.       Engaging any administrative, actuarial, legal,
                           medical, accounting, clerical, or other service it
                           may deem appropriate to effectuate the Plan.

         B.       EXPENSES OF THE COMMITTEE

                  The expenses of the Committee properly and actually incurred
                  in the performance of its duties under the Plan shall be paid
                  by the Company.

         C.       BONDING AND COMPENSATION

                  The members of the Committee shall serve without bond, and
                  without compensation for their services as Committee members
                  except as the Company may provide in its discretion.

         D.       INFORMATION TO BE SUBMITTED TO THE COMMITTEE

                  To enable the Committee to perform its functions, the Company
                  shall supply full and timely information to the Committee on
                  all matters relating to Participants as the Committee may
                  require, and shall maintain such other records as the
                  Committee may determine are necessary in order to determine
                  the benefits due or which may become due to Participants or
                  their Beneficiaries under the Plan. The Committee may rely on
                  such records as conclusive with respect to the matters set
                  forth therein.

         E.       NOTICES, STATEMENTS AND REPORTS

                  The Company shall be the "administrator" of the Plan as
                  defined in Title I Section 3(16)(A) of ERISA for purposes of
                  the reporting and disclosure requirements imposed by ERISA and
                  the Code. The Committee shall assist the Company, as
                  requested, in complying with such reporting and disclosure
                  requirements.

         F.       INSURANCE

                  The Company, in its discretion, may obtain, pay for and keep
                  current a policy or policies of insurance, insuring the
                  Committee members, the members of the Board of Directors and
                  other employees to whom any responsibility with respect to the
                  administration of the Plan has been delegated against any and
                  all costs, expenses and liabilities (including attorneys'
                  fees) incurred by such persons as a result of any act, or
                  omission to act, in connection with the performance of their
                  duties, responsibilities and obligations under the Plan and
                  any applicable law.


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<PAGE>   10


         G.       INDEMNITY

                  If the Company does not obtain, pay for and keep current the
                  type of insurance policy or policies referred to in Section
                  VI(F), or if such insurance is provided but any of the parties
                  referred to in Section VI(F) incur any costs or expenses which
                  are not covered under such policies, then the Company shall
                  indemnify and hold harmless, to the extent permitted by law
                  such parties against any and all costs, expenses and
                  liabilities (including attorneys' fees) incurred by such
                  parties in performing their duties and responsibilities under
                  this Plan, provided that such party or parties were not guilty
                  of willful misconduct. In the event that such party is named
                  as a defendant in a lawsuit or proceeding involving the plan
                  (other than in a lawsuit brought against such party by the
                  Company) the party shall be entitled to receive on a current
                  basis the indemnity payments provided for in this subsection,
                  provided however, that if the final judgment entered in the
                  lawsuit or proceeding holds that the party is guilty of
                  willful misconduct with respect to the Plan, the party shall
                  be required to refund the indemnity payments that it has
                  received.

VII.     CLAIMS PROCEDURE

         A.       FILING CLAIM FOR BENEFITS

                  If a Participant or Beneficiary (hereinafter referred to as
                  the "Applicant") does not receive the timely payment of the
                  benefits which the Applicant believes are due under the Plan,
                  the Applicant may make a claim for benefits in the manner
                  hereinafter provided.

                  All claims for benefits under the Plan shall be made in
                  writing and shall be signed by the Applicant. Claims shall be
                  submitted to a representative designated by the Committee and
                  hereinafter referred to as the "Claims Coordinator." The
                  Claims Coordinator may, but need not, be a member of the
                  Committee. If the Applicant does not furnish sufficient
                  information with the claim for the Claims Coordinator to
                  determine the validity of the claim, the Claims Coordinator
                  shall indicate to the applicant any additional information
                  which is necessary for the Claims Coordinator to determine the
                  validity of the claim.

                  Each claim hereunder shall be acted on and approved or
                  disapproved and notice given of its decision by the Claims
                  Coordinator within 90 days following the receipt by the Claims
                  Coordinator of the information necessary to process the claim.

                  In the event the Claims Coordinator denies a claim for
                  benefits in whole or in part, the Claims Coordinator shall
                  notify the Applicant in writing of the denial of the claim and
                  notify the Applicant of his right to a review of the Claims
                  Coordinator's decision by the Committee. Such notice by the
                  Claims Coordinator shall also set forth, in a manner
                  calculated to be understood by the Applicant, the specific
                  reason for such denial, the specific provisions of the Plan or
                  Agreement on which the denial is based, a description of any
                  additional material or information necessary to perfect the
                  claim, with an explanation of why such material or information
                  is necessary, and an explanation of the Plan's appeals
                  procedure as set forth in this Section.

                  If no action is taken by the Claims Coordinator on an
                  Applicant's claim within 90 days after receipt by the Claims
                  Coordinator, such claim shall be deemed to be denied for
                  purposes of the following appeals procedure.




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<PAGE>   11
         B.   APPEALS PROCEDURE

              An Applicant whose claim for benefits is denied in whole or in
              part may appeal from such denial to the Committee for a review of
              the decision by the Committee. Such appeal must be made within
              three months after the Applicant has received actual or
              constructive notice of the denial as provided above. An appeal 
              must be submitted in writing within such period and must:

              1.    Request a review by the Committee of the claim for benefits
                    under the Plan;

              2.    Set forth all of the grounds upon which the Applicants
                    request for review is based and any facts in support
                    thereof, and

              3     Set forth any issues or comments which the Applicant deems
                    pertinent to the appeal.

                    The Committee shall regularly review appeals by Applicants.
                    The Committee shall act upon each appeal within 60 days
                    after receipt thereof unless special circumstances require
                    an extension of time for processing, in which case a
                    decision shall be rendered by the Committee as soon as
                    possible but not later than 120 days after the appeal is
                    received by the Committee.

                    The Committee shall make full and fair review of each appeal
                    and any written materials submitted by the Applicant in
                    connection therewith "The Committee may require the
                    Applicant to submit such additional facts, documents or
                    other evidence as the Committee in its discretion deems
                    necessary or advisable in making its review. The Applicant
                    shall be given the opportunity to review pertinent documents
                    or materials upon submission of a written request to the
                    Committee, provided the Committee finds the requested
                    documents or materials are pertinent to the appeal.

                    On the basis of its review, the Committee shall make an
                    independent determination of the Applicant's eligibility for
                    benefits under the Plan. The decision of the Committee on
                    any claim for benefits shall be final and conclusive upon
                    all parties thereto.

                    In the event the Committee denies an appeal in whole or in
                    part, the Committee shall give written notice of the
                    decision to the Applicant, which notice shall set forth, in
                    a manner calculated to be understood by the Applicant, the
                    specific reasons for such denial and which shall make
                    specific reference to the pertinent provisions of the Plan 
                    or Agreement on which the Committees decision is based.

VIII. AMENDMENT, TERMINATION OR SUSPENSION

        A.   The Plan may be amended or terminated by the Company at any time.
              Such amendment or termination may modify or eliminate any future
              deferrals but cannot reduce or eliminate any other benefits under
              the Plan. Notwithstanding the preceding provisions of this
              Section, for one year following a Change in Control the Company
              shall be prohibited from amending the Plan in any way that
              adversely affects one or more Participants. For purposes of the
              Plan, "Change in Control" means a "Change in Control " as defined
              in the most recent Management Retention Agreement (or other
              contract providing benefits in the event of a change in control of
              the Company) between the Company and the Company's Chief Executive
              Officer.

         B.   The Plan is intended to provide benefits for "a select group of
              management or highly compensated employees" within the meaning of
              Sections 201, 301, and 401 of ERISA, and therefore to be exempt
              from the provisions of Parts 2, 3 and 4 of Title 1 of ERISA.
              Accordingly, in the event it is determined by a court of competent
              jurisdiction or by an opinion of counsel that the Plan constitutes
              an employee pension benefit plan within the meaning of Section
              3(2) of ERISA which is not so exempt, the Plan shall terminate as
              of the date it became nonexempt.

         C.   The Board of Directors in its sole discretion may accelerate all
              benefits upon termination of the Plan, and pay such benefits in a
              single lump sum.



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<PAGE>   12








 IX. MISCELLANEOUS

         A.   PARTICIPANT RIGHTS

              Nothing in the Plan shall confer upon a Participant the right to
              continue in the employ of an Employer or shall limit or restrict
              the right of an Employer to terminate the employment of a
              participant at any time with or without cause.
    
         B.   ALIENATION

              Except as otherwise provided in the Plan, no right or benefit
              under the Plan shall be subject to anticipation, alienation, sale,
              assignment, pledge, encumbrance or charge, and any attempt to
              anticipate, alienate, sell, assign, pledge, encumber or charge
              such right of benefit shall be void. No such right or benefit
              shall in any manner be liable for or subject to the debts,
              liability or torts of a Participant or Beneficiary.

         C.   PARTIAL INVALIDITY

              If any provision in the Plan is held by a court of competent
              jurisdiction to be invalid, void or unenforceable, the remaining
              provisions shall nevertheless continue to be in full force and
              effect without being impaired or invalidated in any way.

         D.   CHOICE OF LAW

              The Plan shall be construed in accordance with ERISA and, to the
              extent not pre-empted by ERISA, the laws of the State of Ohio.

         E.   SHARES AVAILABLE UNDER THE PLAN

              Shares delivered by the Company under the Plan shall be treasury
              shares or shares that have been or may be acquired by the Company.

         F.   ADJUSTMENTS

              The Board shall make or provide for such adjustments in the number
              of units in a Participant's Account as the Board, in its sole
              discretion, exercised in good faith, shall determine is equitably
              required to prevent dilution or enlargement of the rights of the
              Participant that would otherwise result from (a) any stock
              dividend, stock split, combination of shares, recapitalization or
              any other change in capital structure of the Company, (b) any
              merger, consolidation, spin-off, split-off, spin-out, split-up,
              reorganization, partial or complete liquidation or other
              distribution of assets, issuance of rights or warrants to purchase
              securities, or (c) any other corporate transaction or event having
              an effect similar to any of the foregoing.



                                       11

<PAGE>   13


         G.   PAYMENT TO MINORS OR PERSONS UNDER LEGAL DISABILITY

              If any benefit becomes payable to a minor or to a person under a
              legal disability, payment of such benefit shall be made only to
              the conservator or guardian of the intended recipient appointed by
              a court of competent jurisdiction or any other individual or
              institution maintaining or having custody of such intended
              recipient. A release by such conservator, guardian, individual or
              institution shall constitute a legal discharge of the Plan's
              obligation to the intended recipient.

         H.   INABILITY TO LOCATE

              If the Participant or Beneficiary cannot be located by the
              Company using the Participant's or Beneficiary's last known
              address on file with the Company within one year of the
              Participant's Termination Date or death, all benefits due under
              the Plan will be forfeited. It is the sole responsibility of the
              Participant and/or Beneficiary to maintain a current address 
              on file with the Company.

         I.   SUCCESSORS

              In the event of any consolidation, merger, acquisition, or
              reorganization of the Company, the obligations of the Company
              under this Plan shall continue and be binding upon the Company and
              successors.

          J.  GENDER, TENSE AND HEADINGS

              Whenever any words are used herein in the masculine gender, they
              shall be construed as through they were also used in the feminine
              gender in all cases where they would so apply. Whenever any words
              used herein are in the singular form, they shall be construed as
              though they were also used in the plural form in all cases where
              they would so apply. Headings and Sections and subsections as used
              herein are inserted solely for convenience and reference and
              constitute no part of the Plan.




 Executed at _______________, this ________ day of ________________, 1997.


                                               CALIBER SYSTEM INC.

                                               By
                                                  ------------------------------
                                               Its
                                                  ------------------------------








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