Exhibit 10(a)

                             EMPLOYMENT AGREEMENT

         THIS AGREEMENT is entered into as of April 15, 1998, between
JACOBSON STORES INC., a Michigan corporation, of Jackson, Michigan (the
"Company"), and P. GERALD MILLS, of Chelsea, Michigan ("Mills").

         THE PARTIES HEREBY AGREE that the Employment Agreement between them
dated as of March 19, 1997 is restated, effective April 15, 1998, as follows:

         1.       Employment and Term. The Company employs Mills as Chairman 
of the Board and Chief Executive Officer, and Mills agrees to serve in that
capacity and/or in such other capacity or capacities as the Board of
Directors of the Company deems advisable, for a term commencing October 31,
1996 and continuing through April 15, 2000, unless terminated sooner pursuant
to the provisions of paragraph 5, for the compensation and on the terms set
forth in this Agreement.

         2.       Compensation.

                  (a)      Salary. Subject to the provisions of paragraph 5,
Mills's salary shall be Three Hundred Thousand Dollars ($300,000.00) per
year.

                  (b)      Bonus. Mills shall participate in the 1996 Jacobson
Stores Inc. Management Incentive Plan and, while employed by the Company, in
any successor management incentive plan established from time to time by the
Company.

                  (c)      Vacation and Other Benefits. While he is employed 
by the Company, Mills shall be entitled to four weeks of vacation each year
beginning in fiscal 1997. Mills shall also participate in such plans and
additional benefits as may generally be available from time to time to other
executive officers of the Company and for which Mills is eligible.

                  (d)      Stock Option. Effective October 31, 1996, Mills was
granted an option to purchase 300,000 of the Company's Common Shares, par
value $1.00 a share, at $8.375 a share (the "Option"). Mills's right to
purchase 200,000 Common Shares subject to the Option was subject to
shareholder approval of an amendment to the Jacobson Stock Option Plan of
1994 (the "Plan") increasing the number of shares subject to the Plan, which
was obtained at the 1997 Annual Meeting of Shareholders.

         3.       Deferred Compensation. Mills may determine that payment of 
any part of Mills's salary for any year shall be deferred pursuant to, and on
the terms and conditions set forth in, the Jacobson Stores Inc. Deferred
Compensation Plan, as amended from time to time. If any part of Mills's
salary for a year is deferred, one-twelfth of such amount shall be deferred
each month during the year. Interest shall accrue on deferred compensation
from the last day of the month for which the compensation is deferred.
Neither Mills, his estate, his wife, nor any beneficiary shall have any power
to assign or encumber the right to receive deferred compensation, and any
attempted assignment or encumbrance thereof shall be null and void.


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         4.       Duties. Mills agrees, as long as his employment by the 
Company continues, to devote his best efforts to furthering the interests of
the Company; to comply with all regulations and policies of the Company; and
to perform the duties requested by the Board of Directors of the Company.

         5.       Termination. Mills's employment under this Agreement shall
terminate on the earliest to occur of the following: (i) immediately upon
Mills's death, (ii) at the Company's option, immediately when notice to Mills
of such termination is given after Mills's "Disability" (as defined below),
(iii) at the Company's option, immediately when notice to Mills of such
termination is given on or after the occurrence of "Cause" (as defined below)
for termination of his employment under this Agreement, (iv) not less than 30
days after notice of such termination is given to Mills by the Company, (v)
not less than six months after notice of such termination is given to the
Company by Mills (unless the Company elects to have such termination occur
earlier), and (vi) April 15, 2000. "Disability" means (1) if Mills is covered
by a Company-provided disability insurance policy, the definition of
disability contained in, and entitling Mills to benefits under, that policy,
or (2) if Mills is not covered by such a policy, Mills's inability, whether
physical or mental, to perform the normal duties of Mills's position for six
consecutive months. "Cause" means (1) Mills's continued failure either to (A)
devote substantially full time to Mills's employment duties (except because
of Mills's illness or Disability) or (B) make a good faith effort to perform
Mills's employment duties; (2) any other willful act or omission which Mills
knew, or had reason to know, would materially injure the Entity; (3) any
breach by Mills of the provisions of paragraph 7, or (4) Mills's conviction
of a felony involving dishonesty or fraud. Notice will be deemed to be given
on the earliest of (i) when delivered, or (ii) three business days after
mailed by certified or registered mail, postage prepaid, return receipt
requested, or (iii) one business day after sent by recognized overnight
courier, if to Mills, to Mills's address on the Company's corporate records,
and if to the Company, to the address of its principal executive offices. The
following events during the term of this Agreement shall have the following
respective effects on the obligations of the Company pursuant to this
Agreement:

                  (a)      Death. If employment is terminated due to Mills's
death, the Company shall have no obligation to pay any salary or other
amounts or benefits under this Agreement or otherwise for any period after
the date of termination of employment, but benefits may continue to the
extent provided in any wage continuation program, insurance, or other
employee benefit plans that are generally applicable to all executive
officers of the Company and that are maintained by the Company at that time.
Mills shall be entitled to his accrued salary through the date of termination
and the pro rata bonus, if any, that would have been payable to Mills under
any bonus plan in effect at the time of termination of Mills's employment if
Mills had been employed by the Company for the entire year in which Mills's
employment terminates, but based on the actual number of days Mills was
employed by the Company in that year and the actual salary paid to Mills by
the Company with respect to the period through the date of termination.

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                  (b)      Disability. If employment is terminated due to 
Mills's Disability, the Company shall have no obligation to pay any salary or
other amounts or benefits under this Agreement or otherwise for any period
after the date of termination of employment, but benefits may continue to the
extent provided in any wage continuation program, insurance, or other
employee benefit plans that are generally applicable to all executive
officers of the Company and that are maintained by the Company at that time.
Mills shall be entitled to his accrued salary through the date of termination
and the pro rata bonus, if any, that would have been payable to Mills under
any bonus plan in effect at the time of termination of Mills's employment if
Mills had been employed by the Company for the entire year in which Mills's
employment terminates, but based on the actual number of days Mills was
employed by the Company in that year and the actual salary paid to Mills by
the Company with respect to the period through the date of termination.

                  (c)      Termination for Cause. If employment is terminated
for Cause, or if Mills resigns before the expiration of the term of this
Agreement, the Company shall have no obligation to pay any salary or any
other amount in lieu thereof for any period after the date of termination of
employment. Mills shall be entitled to his accrued salary through the date of
termination and the pro rata bonus, if any, that would have been payable to
Mills under any bonus plan in effect at the time of termination of Mills's
employment if Mills had been employed by the Company for the entire year in
which Mills's employment terminates, but based on the actual number of days
Mills was employed by the Company in that year and the actual salary paid to
Mills by the Company with respect to the period through the date of
termination.

                  (d)      Termination Without Cause. Except as otherwise 
provided in paragraph 5.(e), if the Company terminates Mills's employment
without Cause before the expiration of the term of this Agreement (other than
as a result of Mills's death or Disability), the Company shall have no
obligation to pay any salary or any other amount in lieu thereof for any
period after the date of termination of employment. Mills shall be entitled
to his accrued salary through the date of termination and the pro rata bonus,
if any, that would have been payable to Mills under any bonus plan in effect
at the time of termination of Mills's employment if Mills had been employed
by the Company for the entire year in which Mills's employment terminates,
but based on the actual number of days Mills was employed by the Company in
that year and the actual salary paid to Mills by the Company with respect to
the period through the date of termination. The Option shall be exercisable
to purchase all of the Common Shares subject to the Option immediately, to
the extent not already purchased, 30 days before such termination of Mills's
employment by the Company.

                  (e)      Change in Control.

                           (i)     Right to Receive Benefits. Mills shall 
         receive the severance benefits described in paragraph 5.(e)(ii) if
         (1) a "Change in Control" (as defined in paragraph 5.(e)(iii))
         occurs during the "Period" (as defined in paragraph 5.(e)(iv)), and
         (2) either (A) at any time during the period beginning 90 days
         before, and ending two years after, the Change in Control, Mills
         terminates his employment with the "Entity" (as

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         defined in paragraph 5.(e)(vii)) for "Good Reason" (as defined in
         paragraph 5.(e)(viii)) or the "Entity" terminates Mills's employment
         without Cause, or (B) at any time during the 3rd month after the
         Change in Control, Mills terminates his employment with the "Entity"
         for any reason or for no reason.

                           (ii)   Severance Benefits. If Mills is entitled to
         severance benefits under paragraph 5.(e)(i), he will receive the
         following:

                                  (1) an amount equal to the annual salary 
                  Mills was receiving immediately before the Change in
                  Control for the period (the "Time") from the date of such
                  termination through two years after the date of such
                  termination; and

                                  (2) a pro rata bonus for the year of such
                  termination equal to (1) the bonus paid or payable to Mills
                  with respect to the last full fiscal year of the Company
                  before the Change in Control (the "Bonus"), multiplied by
                  (2) a fraction, the numerator of which shall be the number
                  of days in the Company's fiscal year in which such
                  termination occurs through the date of such termination,
                  and the denominator of which shall be the total number of
                  days in the Company's fiscal year in which such termination
                  occurs; and

                                  (3) an amount equal to the Time (in years 
                  and fractions of a partial year) multiplied by the amount
                  of the Bonus; and

                                  (4) a continuation during the Time of (1)
                  the medical, dental, life, disability, hospitalization,
                  optical and prescription drug benefits Mills and Mills's
                  dependents were receiving from the Company at the time of
                  the Change in Control (provided that if it is no longer
                  practical for the Company to furnish such benefits, Mills
                  will be reimbursed by the Company during the Time for the
                  cost to Mills of obtaining such benefits), and (2) any
                  automobile allowance or benefits (including automobile
                  insurance and maintenance benefits), and continued use of
                  any automobile, provided to Mills by the Company at the
                  time of the Change in Control; and

                                  (5) If the total amount of all payments of
                  cash or property in the nature of compensation contingent
                  on a change in the ownership or effective control of the
                  Company or in the ownership of a substantial portion of the
                  Company's assets, including, without limitation, the
                  benefits provided pursuant to this paragraph 5.(e)(ii) and
                  payments relating to any stock options or restricted stock
                  that vest as a result of a Change in Control, shall exceed
                  the maximum amount that may be paid to Mills and not be
                  deemed a "parachute payment" resulting in an excise tax to
                  Mills and a loss of compensation deduction to the Company,
                  all within the meaning of Section 280G of the Internal
                  Revenue Code of 1986, as amended, or any successor
                  provision, the Company will pay to Mills (i) the amount of
                  any excise tax imposed on Mills under Section 4999 of the
                  Internal Revenue Code of 

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                  1986, as amended, or any successor provision, as a result
                  of any payments by the Company to Mills pursuant to this
                  paragraph 5.(e)(ii) and (ii) any income tax imposed on
                  Mills as a result of the payments under this paragraph
                  5.(e)(ii)(5)). The benefits provided in paragraphs
                  5.(e)(ii)(1), 5.(e)(ii)(2), 5.(e)(ii)(3) and 5.(e)(ii)(5)
                  shall be paid to Mills in an undiscounted lump sum within
                  10 business days after the date of such termination. The
                  Company may withhold from such payments all federal, state,
                  city and other taxes to the extent such taxes are required
                  to be withheld by applicable law.

                           (iii)  "Change in Control". For purposes of this
         Agreement, a "Change in Control" occurs on the first day any one or
         more of the following occurs:

                                  (1) any person (as such term is used in
                  Sections 13(d) and 14(d)(2) of the Securities Exchange Act
                  of 1934, as amended (the "Exchange Act")), together with
                  all affiliates and associates of such person (as such terms
                  are defined in Rule 12b-2 under the Exchange Act) but
                  excluding all "Excluded Persons" (as defined in paragraph
                  5.(e)(v)), becomes the direct or indirect beneficial owner
                  (within the meaning of Rule 13d-3 under the Exchange Act)
                  of securities of the Company representing (A) 40% or more
                  of the combined voting power of all of the Company's
                  outstanding securities entitled to vote generally in the
                  election of the Company's directors, or (B) 40% or more of
                  the combined shares of the Company's capital stock then
                  outstanding, all except in connection with any merger,
                  consolidation, reorganization or share exchange involving
                  the Company;

                                  (2) the consummation of any merger,
                  consolidation, reorganization or share exchange involving
                  the Company, unless the holders of the Company's capital
                  stock outstanding immediately before such transaction own
                  more than 50% of the combined outstanding shares of capital
                  stock and have more than 50% of the combined voting power
                  in the surviving entity after such transaction and they own
                  such securities in substantially the same proportions
                  (relative to each other) as they owned the Company's
                  capital stock immediately before such transaction;

                                  (3) the consummation of any sale or other
                  disposition (in one transaction or a series of related
                  transactions) of all, or substantially all, of the
                  Company's assets to a person whose acquisition of 40% or
                  more of the combined shares of the Company's capital stock
                  then outstanding would have caused a Change in Control
                  under paragraph 5.(e)(iii)(1)); or

                                  (4) the "Continuing Directors" (as defined
                  in paragraph 5.(e)(vi)) cease to be a majority of the
                  Company's directors.

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         A determination by the Company's Continuing Directors (by resolution
         of at least a majority of the Continuing Directors) as to whether a
         Change in Control has occurred for purposes of this Agreement, the
         date on which it has occurred or both shall be conclusive for
         purposes of this Agreement.

                           (iv)   "Period". The period (the "Period") will 
         begin on the date of this Agreement and end on the first to occur of
         (a) the end of the term of this Agreement, without regard to any
         termination as a result of Mills's death, Disability, termination by
         the Company for Cause, retirement, resignation or termination by the
         Company without Cause, (b) Mills's death, (c) Mills's Disability,
         and (d) 90 days after the termination of Mills's employment
         (voluntarily or involuntarily and with or without Cause or Good
         Reason) if (1) such termination occurs before a Change in Control,
         and (2) a Change in Control does not occur during such 90 day
         period. Notwithstanding the foregoing, (1) if Mills becomes entitled
         to severance benefits under paragraph 5.(e)(i), the provisions of
         paragraph 5.(e)(ii) of this Agreement will continue until Mills's
         eligibility to receive severance benefits under this Agreement
         ceases and such provisions and the other provisions of this
         Agreement not limited by the Period, including, without limitation,
         paragraphs 5.(g), 7, 10 and 11 will survive the end of the Period.

                           (v)    "Excluded Persons". For purposes of this 
         Agreement, the "Excluded Persons" are (i) Mills, (ii) any "group"
         (as that term is used in Section 13(d) of the Exchange Act and the
         rules thereunder) that includes Mills or in which Mills is, or has
         agreed to become, an equity participant, (iii) any entity in which
         Mills is, or has agreed to become, an equity participant, (iv) the
         Company, (v) any subsidiary of the Company, (vi) any employee
         benefit plan of the Company or any subsidiary of the Company or the
         related trust, (vii) any entity to the extent it is holding capital
         stock of the Company for or pursuant to the terms of any employee
         benefit plan of the Company or any subsidiary of the Company, and
         (viii) any director, officer or beneficial owner of at least 10% of
         the Company's outstanding Common Stock as of the date of this
         Agreement. For purposes of this Agreement, Mills shall not be deemed
         an "equity participant" in any group or entity (i) in which Mills
         owns for investment purposes only no more than 5% of the stock of a
         publicly-traded entity whose stock is either listed on a national
         stock exchange or quoted in The Nasdaq National Market, if Mills is
         not otherwise affiliated with such group or entity, or (ii) if
         Mills's participation is fully-disclosed to, and approved by, the
         Company's Board of Directors and the Continuing Directors before the
         Change in Control occurs.

                           (vi)   "Continuing Directors". For purposes of this
         Agreement, the "Continuing Directors" are the directors of the
         Company as of the date of this Agreement, and any person who
         subsequently becomes a director if such person is appointed to be a
         director by a majority of the Continuing Directors or if such
         person's initial nomination for election or initial election as a
         director is recommended or approved by a majority of the Continuing
         Directors.

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                           (vii)   "Entity". For purposes of this Agreement, 
         the "Entity" shall mean both (1) the Company and, (2) in connection
         with a Change in Control defined in paragraph 5.(e)(iii)(2) or
         paragraph 5.(e)(iii)(3), the survivor of the merger, consolidation,
         reorganization or share exchange involving the Company and the buyer
         of all, or substantially all, of the Company's assets, if such
         additional entity described in this clause (2) (if other than the
         Company) has offered to employ Mills on such terms that would not
         constitute "Good Reason" for termination of Mills's employment if
         imposed by the Company. Therefore, for purposes of this paragraph
         5.(e), Mills shall not be deemed to have terminated Mills's
         employment with the Entity for "Good Reason" and the "Entity" shall
         not be deemed to have terminated Mills's employment without Cause
         unless such actions are taken by all entities included within the
         definition of "Entity". In addition, for purposes of this paragraph
         5.(e), Mills shall not be deemed to have terminated Mills's
         employment with the Entity for "Good Reason" and the "Entity" shall
         not be deemed to have terminated Mills's employment without Cause if
         (1) the survivor of the merger, consolidation, reorganization or
         share exchange involving the Company and the buyer of all, or
         substantially all, of the Company's assets has offered to employ
         Mills on such terms that would not constitute "Good Reason" for
         termination of Mills's employment if imposed by the Company, (2)
         Mills refuses such employment, and (3) the Company terminates
         Mills's employment for any reason or for no reason.

                           (viii) "Good Reason". Termination of Mills's 
         employment for "Good Reason" means Mills's voluntary termination of
         employment with the Entity before or after a Change in Control as a
         result of (1) any change by the Entity (without Mills's consent) in
         Mills's title from Mills's title immediately before such Change in
         Control, (2) any decrease by the Entity (without Mills's consent) in
         Mills's compensation or incentives from Mills's compensation and
         incentives immediately before such Change in Control, except with
         respect to benefits covered by clause (3); provided that Mills's
         bonus shall not be deemed to have decreased if Mills has a
         substantially similar opportunity to earn a bonus as Mills did in
         the last full fiscal year before the Change in Control, (3) any
         decrease by the Entity (without Mills's consent) in Mills's benefits
         from Mills's benefits immediately before such Change in Control,
         unless such decrease is applied in the same manner to all executive
         officers of the Entity, (4) a substantial change by the Entity
         (without Mills's consent) in Mills's duties or responsibilities from
         Mills's duties and responsibilities immediately before such Change
         in Control, (5) any requirement by the Entity (to which Mills does
         not consent) that Mills change Mills's primary place of business to
         be outside the metropolitan Jackson area, (6) Mills's removal from,
         or failure to be elected to, the Entity's Board of Directors or the
         Entity's failure to nominate Mills for election to the Entity's
         Board of Directors, or (7) if the Change in Control results in a new
         entity being a successor to the Company's business, the failure of
         the new entity to assume expressly in writing the Company's
         obligations under this Agreement and under any written employment
         agreement between Mills and the Company in effect immediately before
         the Change in Control. "Good Reason" will not include Mills's death,
         Disability or Retirement (as defined below), or Mills's resignation
         other than as provided in the preceding sentence. For purposes of
         this Agreement, "Retirement" means Mills's retirement from the
         Entity in accordance with the Entity's normal policies.

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                  (f) Transfer of Insurance Policies. If Mills's employment
by the Company is terminated for any reason except Mills's death, the Company
will cooperate with Mills, to the extent Mills so desires, to transfer to
Mills, at no cost to the Company and in exchange for a payment by Mills to
the Company equal to the value of the Company's interest in the policies, any
life and disability insurance maintained by the Company on his behalf
immediately before the termination of his employment, to the extent permitted
by the applicable insurance policies.

                  (g) No Other Employment Benefits. The severance benefits
provided in this Agreement are exclusive and in lieu of any other severance
benefits to which Mills may be entitled, except for any benefits under the
terms of any stock options or restricted stock agreements Mills may have.

         6.       Payment. Amounts equal to, or based on, salary, other than
deferred compensation, as well as death benefits, if any, pursuant to
paragraph 5.(a), other than proceeds of life insurance, and amounts equal to,
or based on, salary, if any, other than deferred compensation and proceeds of
life insurance, paid pursuant to paragraphs 5.(b), 5.(c) and 5.(d), shall be
paid in monthly or other regular periodic installments no less frequent than
monthly. Amounts equal to the pro rata portion of Mills's bonus for the year
of termination paid pursuant to paragraphs 5.(a), 5.(b), 5.(c) and 5.(d)
shall be paid at the time they are paid to other participants in the
applicable bonus plan. Deferred compensation, with interest thereon, shall be
paid as provided in the Jacobson Stores Inc. Deferred Compensation Plan, as
amended from time to time. The amounts described in paragraph 5.(e) shall be
paid as described in paragraph 5.(e)(ii)(5). All such payments shall be made
to Mills while he is living; and in the event of his death, the payments
shall be made to Mills's wife, if she is then living, or to his estate or any
beneficiary or beneficiaries he designates in writing during his lifetime.

         7.       Confidentiality and Non-Solicitation.

                  (a) Confidential Information. Mills will not at any time
during or after his employment with the Company, directly or indirectly,
disclose or make accessible to any person or entity or use in any way for his
own personal gain (i) any confidential and secret information as to the
prices, costs, discounts, or profit margins of any goods or services sold,
purchased or handled by the Company (or its subsidiaries), or (ii) any
confidential or secret information relating to the Company's (or its
subsidiaries') financial structure, store layouts, supply sources, designs,
procedures, information systems, administration or operations, except as
authorized or directed by the Company and except that the foregoing
restrictions will not apply to information generally available to others in
the Company's line of business, information in the public domain, information
disclosed or made available by the Company to any other person on a
non-confidential basis or disclosures Mills is required by law to make. Upon
termination of Mills's employment with the Company for any reason, Mills will
immediately return to the Company all confidential materials over which he
exercises any control.


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                  (b) Non-Solicitation. Mills will not at any time during his
employment by the Company and for two years thereafter, directly or
indirectly, solicit for any purpose, interfere with, entice away from the
Company (or its subsidiaries) or hire any employee or agent of the Company
(or its subsidiaries) who was employed by the Company within one year before
the termination of his employment.

                  (c) Equitable Remedies. Paragraphs 7.(a) and 7.(b) are
intended, among other things, to protect the confidential information
described in paragraph 7.(a) and relate to matters which are of a special and
unique character, and their violation may cause irreparable injury to the
Company, the amount of which will be extremely difficult, if not impossible,
to determine and which cannot be adequately compensated by monetary damages
alone. Therefore, if Mills breaches or threatens to breach any of those
paragraphs, in addition to any other remedies which may be available to the
Company under this agreement or at law or equity, the Company may obtain an
injunction, restraining order, or other equitable relief against Mills and
such other persons and entities as are appropriate.

         8.      Modification. This Agreement is the complete agreement 
between Mills and the Company and may be modified only by a written
instrument executed by both parties.

         9.      Law. The internal laws of the State of Michigan shall govern
this Agreement, its construction, and the determination of any rights, duties
or remedies of the parties arising out of or relating to this Agreement..

         10.     Costs of Enforcement. The Company shall pay on demand all of
Mills's reasonable out-of-pocket fees, costs and expenses (including
reasonable attorneys' fees, court costs and other legal expenses and costs of
investigation) incurred by Mills in connection with the enforcement of this
Agreement (as amended from time to time and including any successor to this
Agreement) or in connection with any disputes concerning the meaning or
interpretation of this Agreement (as amended from time to time and including
any successor to this Agreement). During the pendency of any such enforcement
proceeding or dispute, the Company shall continue to pay the disputed amounts
and benefits provided in this Agreement (as amended from time to time and
including any successor to this Agreement), and if it fails to do so, the
Company shall pay Mills interest, at the prime or base rate announced from
time to time by Comerica Bank, on such amounts from the date they were due
through the date they are actually paid. The obligations contained in this
paragraph 10 shall survive the end of the Period.

         11.     Arbitration.

                 (a) Agreement to Arbitrate. Any disputes between the
parties with respect to the terms and conditions of this Agreement (as
amended from time to time and including any successor to this Agreement)
(other than those disputes with respect to which equitable relief (such as
specific performance or an injunction) is the appropriate remedy) that are
not resolved within 30 days after one party notifies the other party in
writing of the dispute shall be resolved by and through binding arbitration
conducted under the auspices of the American Arbitration Association (or any
like organization successor thereto) in Jackson, Michigan. Both the foregoing
agreement 

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of the parties to arbitrate any and all claims, and the results,
determination, finding, judgment and/or award rendered through such
arbitration, shall be final and binding on the parties to this Agreement and
may be specifically enforced by legal proceedings, and, pursuant to MCLA ss.
600.5001, the parties agree that a judgment of any Michigan circuit court may
be rendered upon any arbitration award rendered pursuant to this paragraph
11. The parties agree and acknowledge that money damages may not be an
adequate remedy for any breach of the provisions of this arbitration
agreement and that any party may, in his or its sole discretion, ask for
specific performance and/or injunctive relief in order to enforce or prevent
any violations of the provisions of this arbitration agreement.

                 (b) Procedure. Such arbitration shall be initiated by the
written notice of the dispute described in paragraph 11.(a), and such
arbitration shall be a compulsory and binding proceeding on each party. Such
arbitration proceeding shall be conducted under the commercial arbitration
rules (formal or informal) of the American Arbitration Association before one
arbitrator, and the arbitrator in any such arbitration shall be such person
who is expert in the subject matter of the dispute. The costs of the
arbitrator and the arbitration shall be borne by the Company. Each party will
bear separately the cost of its or his respective attorneys, witnesses and
experts in connection with such arbitration, subject to the Company's
obligations under paragraph 10. Time is of the essence of this arbitration
procedure, and the arbitrator shall be requested to render his or her
decision within 10 days following completion of the arbitration.

         12.     Successor Obligations. This Agreement will be binding upon 
and inure to the benefit of the Company and its successors and assigns, and
the Company will require any successor to, or transferee of, all or
substantially all of its business or assets to assume all of the Company's
obligations under this Agreement (such successor or assign will be deemed,
for purposes of this Agreement, to be the Company). This Agreement will be
binding upon Mills and will inure to Mills's benefit, but Mills may not
assign this Agreement without the Company's prior written consent.

         13.     Duplicate Copies. This Agreement may be executed in
counterparts, both of which together will be deemed an original of this
Agreement.

         14.     Severability. The provisions of this Agreement will be deemed
severable, and if any part of any provision is held illegal, void or invalid
under applicable law, such provision may be changed to the extent reasonably
necessary to make the provision, as so changed, legal, valid and binding. If
any provision of this Agreement is held illegal, void or invalid in its
entirety, the remaining provisions of this Agreement will not in any way be
affected or impaired but will remain binding in accordance with their terms.

         15.     Miscellaneous Provisions. This Agreement supersedes all 
previous employment agreements between the parties. In addition to all other
remedies available at law, it shall be specifically enforceable by any court
having jurisdiction. Paragraph headings are for convenience only and shall
not affect the construction of any provision. The rights and obligations
hereunder shall survive the expiration of the term of this Agreement.


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IN THE PRESENCE OF:                JACOBSON STORES INC.

                                   By:      /s/  Paul W. Gilbert
---------------------------            ----------------------------------
                                            Paul W. Gilbert,
                                               Vice Chairman of the Board

                                   By:      /s/  Richard Z. Rosenfeld
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                                            Richard Z. Rosenfeld,
                                               Secretary

                                        /s/  P. Gerald Mills
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                                   P. Gerald Mills