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                                                                    EXHIBIT 10.3

           AMERICAN GENERAL CORPORATION 1997 STOCK AND INCENTIVE PLAN

1. PURPOSE

     The purpose of the American General Corporation 1997 Stock and Incentive
Plan (the "Plan") is to provide a means through which American General
Corporation, a Texas corporation, and its subsidiaries (collectively, the
"Company") may attract able persons to enter the employ or become directors of
the Company and to provide a means whereby those persons upon whom the
responsibilities of the successful administration and management of the Company
rest, and whose present and potential contributions to the welfare of the
Company are of importance, can acquire and maintain stock ownership, thereby
strengthening their concern for the welfare of the Company and their desire to
remain in its employ or as directors. A further purpose of the Plan is to
provide such persons with additional incentive and reward opportunities
designed to enhance the profitable growth of the Company. So that the maximum
incentive can be provided, the Plan provides for granting Incentive Stock
Options, Non-Qualified Options, Restricted Stock Awards, Performance Awards,
and Incentive Awards, or any combination of the foregoing, as is best suited to
the circumstances of the particular person.


2. DEFINITIONS

     The following definitions shall be applicable throughout the Plan:

     (a) "Award" means, individually or collectively, any Option, Restricted
Stock Award, Performance Award, or Incentive Award.

     (b) "Board" means the Board of Directors of American General Corporation.

     (c) "Code" means the Internal Revenue Code of 1986, as amended. Reference
in the Plan to any section of the Code shall be deemed to include any
amendments or successor provisions to such section and any regulations under
such section.

     (d) "Committee" means a committee of the Board that is selected by the
Board as provided in Section 4 (a).

     (e) "Common Stock" means the common stock of American General Corporation.

     (f) "Company" means, collectively, American General Corporation and its
subsidiaries.

     (g) "Director" means an individual elected to the Board by the
shareholders of the Company or by the Board under applicable corporate law who
is serving on the Board on the date the Plan is adopted by the Board or is
elected to the Board after such date.

     (h) "Employee" means any person (including a Director) in an employment
relationship with the Company or any parent or subsidiary corporation (as
defined in section 424 of the Code).





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     (i) "Fair Market Value" means, as of any specified date, the average of
the highest and lowest quoted selling prices of the Common Stock as reported on
the Composite Tape for issues listed on the New York Stock Exchange on the
specified date, or, if no sales were reported on the Composite Tape on such
specified date, the average of the highest and lowest quoted selling prices of
the Common Stock on the nearest dates before and after such specified date on
which sales of the Common Stock were so reported.

     (j) "Holder" means an employee or a non-employee Director of the Company
who has been granted an Option, a Restricted Stock Award, a Performance Award,
or an Incentive Award.

     (k) "Incentive Award" means an Award granted under Section 10 of the Plan.

     (l) "Incentive Stock Option" means an Option within the meaning of section
422(b) of the Code.

     (m) "Immediate Family" means, with respect to a Holder, the Holder's
spouse, children or grandchildren (including adopted and step children and
grandchildren).

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

     (o) "Non-Qualified Option" means an Option that is not an Incentive Stock
Option.

     (p) "Option" means an Award under Section 7 of the Plan and includes both
Non-Qualified Options and Incentive Stock Options to purchase Common Stock.

     (q) "Performance Award" means an Award granted under Section 9 of the
Plan.

     (r) "Personal Representative" means the person who upon the death,
disability, or incompetency of a Holder shall have acquired, by will or by the
laws of descent and distribution or by other legal proceedings, the right to
exercise an Option or the right to any Restricted Stock Award, Performance
Award, or Incentive Award theretofore granted or made to such Holder.

     (s) "Plan" means the American General Corporation 1997 Stock and Incentive
Plan, as amended from time to time.

     (t) "Restricted Stock Award" means an Award granted under Section 8 of the
Plan.

     (u) "Rule 16b-3" means SEC Rule 16b-3 promulgated under the 1934 Act, as
such may be amended from time to time, and any successor rule, regulation, or
statute fulfilling the same or similar function.


3. EFFECTIVE DATE AND DURATION OF THE PLAN

     The Plan shall become effective on February 6, 1997, following adoption by
the Board, provided the Plan is approved by the shareholders of American
General Corporation within twelve months thereafter. Notwithstanding any
provision in the Plan or in any agreement under the Plan, no Option shall be
exercisable and no Award shall vest prior to such shareholder approval. No
further Awards may be granted under the Plan after ten years from the date the
Plan becomes effective. The Plan shall remain in effect until all Options
granted under the Plan have been exercised or expired by reason of lapse of
time, all restrictions imposed upon Restricted Stock Awards have been
eliminated, and all Performance Awards and Incentive Awards have been
satisfied.





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4. ADMINISTRATION

     (a) Composition of Committee. The Plan shall be administered by a
committee of, and appointed by, the Board, and such Committee shall be
comprised solely of two or more outside Directors (within the meaning of
section 162(m) of the Code and applicable interpretive authority thereunder)
who are also Non-Employee Directors (within the meaning of Rule 16b-3). A
majority of the Committee shall constitute a quorum. The Committee shall act by
majority action at a meeting, except that action permitted to be taken at a
meeting may be taken without a meeting if written consent thereto is given by
all members of the Committee.

     (b) Powers. Subject to the express provisions of the Plan, the Committee
shall have authority, in its discretion, to determine which employees or
Directors of the Company shall receive an Award, the time or times when such
Award shall be made, whether an Incentive Stock Option or Non-Qualified Option
shall be granted, the number of shares to be subject to each Option and
Restricted Stock Award, and the value of each Performance Award and Incentive
Award. In making such determinations, the Committee shall take into account the
nature of the services rendered by the respective employees or Directors, their
present and potential contribution to the Company's success, and such other
factors as the Committee shall deem relevant. The Board shall also have
authority, in its discretion, to grant such Awards as it may determine to
non-employee Directors.

     (c) Additional Powers. The Committee shall have such additional powers as
are delegated to it by the other provisions of the Plan. Subject to the express
provisions of the Plan, this shall include the power to construe the Plan and
the respective agreements executed thereunder, to prescribe rules and
regulations relating to the Plan and to determine the terms, restrictions, and
provisions of the agreement to each Award, including such terms, restrictions,
and provisions as shall be requisite in the judgment of the Committee to cause
designated Options to qualify as Incentive Stock Options, to ensure that the
grant of Awards are exempt under Rule 16b-3, and to make all other
determinations necessary or advisable for administering the Plan. Without
limiting the generality of the foregoing, agreements providing for Awards under
the Plan may contain such provisions covering a change of control of the
Company, as defined by the Committee in its sole discretion, as the Committee
may approve, not inconsistent with the terms of this Plan, including without
limitation provisions for the acceleration of, vesting of, or the payment of
cash in lieu of, any Award. The Committee may correct any defect or supply any
omission or reconcile any inconsistency in the Plan or in any agreement
relating to an Award in the manner and to the extent it shall deem expedient to
carry it into effect.  The Committee may delegate to other persons the
responsibility of performing ministerial acts in furtherance of the Plan's
purposes. The determinations of the Committee on the matters referred to in
this Section 4 shall be conclusive.


5. GRANT OF OPTIONS, RESTRICTED STOCK AWARDS, PERFORMANCE AWARDS, AND INCENTIVE
   AWARDS; SHARES SUBJECT TO THE PLAN

     (a) Stock Grant Limit. The Committee may from time to time grant Awards to
one or more employees or Directors determined by it to be eligible for
participation in the Plan in accordance with the provisions of Section 6.
Subject to adjustment in the same manner as provided in Section 11 with respect
to shares of Common Stock subject to Awards then outstanding, the aggregate
number of shares of Common Stock that may be issued under the Plan shall not
exceed 7,000,000. Shares shall be deemed to have been issued under the Plan
only to the extent actually issued and delivered pursuant to an Award. To the
extent that an Award lapses or the rights of its Holder terminate or the Award
is paid in cash, any shares of Common Stock subject to such Award shall again
be available for the grant of an Award.  Notwithstanding any provision in the
Plan to the contrary, the maximum number of shares of Common Stock that may be
subject to Awards granted to any one individual during the term of the Plan may
not exceed 7,000,000 shares of Common Stock (subject to adjustment in the same
manner as provided in Section 11 with respect to shares of Common Stock subject
to Awards then outstanding); provided that any such individual shall also be
subject to the separate limitations contained in Sections 7, 8, and 9 with
respect to specific types of Awards. The limitation set forth in the preceding
sentence shall be applied in a manner which will permit compensation generated
under the Plan to constitute "performance-based" compensation for purposes of
section 162(m) of the Code, including, without limitation, counting





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against such maximum number of shares, to the extent required under section
162(m) of the Code and applicable interpretive authority thereunder, any shares
subject to options or surrender rights that are cancelled or repriced.

     (b) Stock Offered. The stock to be offered pursuant to the grant of an
Award may be authorized but unissued Common Stock or Common Stock previously
issued and outstanding and reacquired by the Company.


6. ELIGIBILITY

     Awards may be granted only to persons who, at the time of grant, are key
employees of the Company or Directors.  Awards may not be granted to any person
who immediately after such grant is the owner, directly or indirectly, of more
than 10% of the total combined voting power of all classes of stock of the
Company. An Award may be granted on more than one occasion to the same person,
and such Award may include an Incentive Stock Option, Non-Qualified Option,
Restricted Stock Award, Performance Award, Incentive Award, or any combination
thereof.


7. STOCK OPTIONS

     (a) Limitations on Awards. The maximum number of shares of Common Stock
that may be subject to Option Awards granted to any one individual during any
calendar year may not exceed 500,000 shares of Common Stock (subject to
adjustment in the same manner as provided in Section 11 with respect to shares
of Common Stock subject to Options then outstanding).

     (b) Option Period. The term of each Option shall be as specified by the
Committee at the date of grant but shall not exceed ten years.

     (c) Limitations on Exercise of Option. An Option shall be exercisable in
whole or in such installments and at such times, commencing not earlier than
six months from the date of grant, as determined by the Committee.

     (d) Stock Option Agreement. Each Option shall be evidenced by an Option
agreement in such form and containing such provisions not inconsistent with the
provisions of the Plan as the Committee from time to time shall approve,
including, without limitation, provisions to qualify as an Incentive Stock
Option under section 422 of the Code.

     (e) Option Price and Payment. The price at which a share of Common Stock
may be purchased upon exercise of an Option shall be determined by the
Committee, but, subject to adjustment in the same manner as provided in Section
11, shall not be less than the Fair Market Value of a share of Common Stock at
the date such Option is granted. The Option or portion thereof may be exercised
by delivery of an irrevocable notice of exercise to the Company. The purchase
price of the Option or portion thereof shall be paid in full in the manner
prescribed by the Committee.

     (f) Restrictions on Transfer. An Option shall not be transferable or
assignable otherwise than (i) by will or the laws of descent and distribution,
(ii) with respect to Awards of Non-Qualified Stock Options, pursuant to a
qualified domestic relations order (as defined by the Code), or (iii) with
respect to Awards of Non-Qualified Stock Options, if such transfer is permitted
in the sole discretion of the Committee, by transfer by a Holder to a member of
the Holder's Immediate Family, to a trust solely for the benefit of the Holder
and his Immediate Family, or to a partnership or limited liability company
whose only partners or shareholders are the Holder and members of his Immediate
Family.

     (g) Shareholder Rights and Privileges. The Holder shall be entitled to all
the privileges and rights of a shareholder only with respect to such shares of
Common Stock as have been purchased under the Option and for which certificates
of stock have been registered in the Holder's name.





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     (h) Special Limitations on Incentive Stock Options. An Incentive Stock
Option may be granted only to an individual who is an Employee at the time the
option is granted. In the case of Incentive Stock Options, the value of shares
of stock for which such Options are exercisable for the first time in any one
calendar year cannot exceed $100,000 based on the Fair Market Value of the
stock at the date of grant according to section 422(d)(1) of the Code (or such
other individual limit as may be in effect under the Code on the date of
grant).

     (i) Surrender of Options. The Committee (concurrently with the grant of an
Option or subsequent to such grant) may, in its sole discretion, grant to any
Option Holder the right, upon written request, to surrender any exercisable
Option or portion thereof in exchange for cash, whole shares of Common Stock,
or a combination thereof, as determined by the Committee, with a value equal to
the excess of the Fair Market Value, as of the date of such request, of one
share of Common Stock over the Option price for such share multiplied by the
number of shares covered by the Option or portion thereof to be surrendered. In
the case of any such surrender right which is granted in connection with an
Incentive Stock Option, such right shall be exercisable only when the Fair
Market Value of the Common Stock exceeds the price specified therefor in the
Option or portion thereof to be surrendered. In the event of the exercise of
any surrender right granted hereunder, the number of shares reserved for
issuance under the Plan shall be reduced only to the extent that shares of
Common Stock are actually issued in connection with the exercise of such
surrender right. Additional terms and conditions governing any such surrender
rights may from time to time be prescribed by the Committee in its sole
discretion.


8. RESTRICTED STOCK AWARDS

     (a) Limitations on Awards. The maximum number of shares of Common Stock
that may be subject to Restricted Stock Awards granted to any one individual
during any calendar year may not exceed 50,000 shares of Common Stock (subject
to adjustment in the same manner as provided in Section 11 with respect to
shares of Common Stock subject to Restricted Stock Awards then outstanding).
Subject to adjustment in the same manner as provided in Section 11 with respect
to shares of Common Stock subject to Restricted Stock Awards then outstanding,
the aggregate number of shares of Common Stock that may be issued under the
Plan with respect to Restricted Stock Awards shall not exceed 2,000,000.

     (b) Restriction Period to be Established by the Committee. At the time a
Restricted Stock Award is made, the Committee shall establish a period of time
(the "Restriction Period") applicable to such Award. Each Restricted Stock
Award may have a different Restriction Period, in the discretion of the
Committee.

     (c) Forfeiture Restrictions to be Established by the Committee. Shares of
Common Stock that are the subject of a Restricted Stock Award shall be subject
to restrictions on disposition by the Holder and an obligation of the Holder to
forfeit and surrender the shares to the Company under certain circumstances
(the "Forfeiture Restrictions"). The Forfeiture Restrictions shall be
determined by the Committee in its sole discretion, and the Committee may
provide that the Forfeiture Restrictions shall lapse upon (i) the attainment of
one or more performance targets established by the Committee that are based on
(1) the price of a share of Common Stock, (2) the Company's earnings per share,
(3) the Company's market share, (4) the market share of a business unit of the
Company designated by the Committee, (5) the return on shareholders' equity
achieved by the Company, or (6) the payment of cash dividends, (ii) the
Holder's continued employment with the Company or continued service as a
Director for a specified period of time, (iii) the occurrence of any event or
the satisfaction of any other condition specified by the Committee in its sole
discretion, or (iv) a combination of any of the foregoing. Each Restricted
Stock Award may have different Forfeiture Restrictions, in the discretion of
the Committee.

     (d) Other Terms and Conditions. Common Stock awarded pursuant to a
Restricted Stock Award shall be represented by a stock certificate registered
in the name of the Holder of such Restricted Stock Award. The Holder shall have
the right to receive dividends during the Restriction Period, to vote Common
Stock subject thereto, and to enjoy all other shareholder rights, except that
(i) the Holder shall not be entitled to delivery of the stock certificate until
the





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Restriction Period shall have expired, (ii) the Company shall retain custody of
the stock during the Restriction Period, (iii) the Holder may not sell,
transfer, pledge, exchange, hypothecate, or otherwise dispose of the stock
during the Restriction Period, and (iv) a breach of the terms and conditions
established by the Committee pursuant to the Restricted Stock Award shall cause
a forfeiture of the Restricted Stock Award.

     (e) Payment for Restricted Stock. A Holder shall not be required to make
any payment for Common Stock received pursuant to a Restricted Stock Award,
except to the extent otherwise required by law or the Committee.


9. PERFORMANCE AWARDS

     (a) Limitation on Awards. The maximum number of shares of Common Stock
that may be subject to Performance Awards granted to any one individual during
any calendar year may not exceed 100,000 shares of Common Stock, subject to
adjustment in the same manner as provided in Section 11 with respect to shares
of Common Stock subject to Performance Awards then outstanding.

     (b) Performance Period. The Committee shall establish, with respect to and
at the time of each Performance Award, a performance period over which the
performance of the Holder shall be measured.

     (c) Performance Awards. Each Performance Award shall have a maximum value
established by the Committee at the time of such Award.

     (d) Performance Measures. A Performance Award shall be awarded to a Holder
contingent upon future performance of the Company or any subsidiary, division,
or department thereof by or in which such Holder is employed during the
performance period. The Committee shall establish the performance measures
applicable to such performance prior to the beginning of the performance
period; provided such measures may be made subject to automatic adjustment for
specified significant extraordinary items or events. The performance measures
established by the Committee may be based upon (i) the price of a share of
Common Stock, (ii) the Company's earnings per share, (iii) the Company's market
share, (iv) the market share of a business unit of the Company designated by
the Committee, (v) the return on shareholder's equity achieved by the Company,
or (vi) the payment of cash dividends, or a combination of any of the
foregoing. The Committee, in its sole discretion, may provide for an adjustable
Performance Award value based upon the level of achievement of performance
measures.

     (e) Awards Criteria. In determining the value of Performance Awards, the
Committee shall take into account a Holder's responsibility level, performance,
potential, other Awards, and such other considerations as it deems appropriate.
The Committee, in its sole discretion, may provide for a reduction in the value
of a Holder's Performance Award during the performance period.

     (f) Payment. Following the end of the performance period, the Holder of a
Performance Award shall be entitled to receive payment of an amount not
exceeding the maximum value of the Performance Award, based on the achievement
of the performance measures for such performance period, as determined by the
Committee. Payment of a Performance Award may be made in cash, Common Stock, or
a combination thereof, as determined by the Committee. Payment shall be made in
a lump sum or in installments as prescribed by the Committee. Any payment to be
made in cash shall be based on the Fair Market Value of the Common Stock on the
payment date.

     (g) Termination of Employment. A Performance Award shall terminate if the
Holder does not remain continuously in the employ (or in service as a Director)
of the Company at all times during the applicable performance period, except as
may be determined by the Committee.





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10. INCENTIVE AWARDS

     (a) Incentive Awards. Incentive Awards are rights to receive shares of
Common Stock (or the Fair Market Value thereof), or rights to receive an amount
equal to any appreciation or increase in the Fair Market Value of Common Stock
over a specified period of time, which vest over a period of time as
established by the Committee, without satisfaction of any performance criteria
or objectives. The Committee may, in its discretion, require payment or other
conditions of the Holder respecting any Incentive Award. Each Incentive Award
shall have a maximum value established by the Committee at the time of such
Award.

     (b) Award Period. The Committee shall establish, with respect to and at
the time of each Incentive Award, a period over which the Award shall vest with
respect to the Holder.

     (c) Awards Criteria. In determining the value of Incentive Awards, the
Committee shall take into account a Holder's responsibility level, performance,
potential, other Awards, and such other considerations as it deems appropriate.

     (d) Payment. Following the end of the vesting period for a Incentive
Award, the Holder of an Incentive Award shall be entitled to receive payment of
an amount, not exceeding the maximum value of the Incentive Award, based on the
then vested value of the Award. Payment of an Incentive Award may be made in
cash, Common Stock, or a combination thereof as determined by the Committee.
Payment shall be made in a lump sum or in installments as prescribed by the
Committee. Any payment to be made in cash shall be based on the Fair Market
Value of the Common Stock on the payment date. Cash dividend equivalents may be
paid during or after the vesting period with respect to an Incentive Award, as
determined by the Committee.

     (e) Termination of Employment. An Incentive Award shall terminate if the
Holder does not remain  continuously in the employ (or in service as a
Director) of the Company at all times during the applicable vesting period,
except as may be otherwise determined by the Committee.


11. CHANGE IN CAPITAL STRUCTURE.

     Options, Restricted Stock Awards, Performance Awards, Incentive Awards,
and any agreements evidencing such Awards shall be subject to adjustment by the
Committee at its discretion as to the number and price of shares of Common
Stock or other consideration subject to such Awards in the event of changes in
the outstanding Common Stock by reason of stock dividends, stock splits,
recapitalizations, reorganizations, mergers, consolidations, combinations,
exchanges, or other relevant changes in capitalization occurring after the date
of the grant of any such Awards. In the event of any such change in the
outstanding Common Stock, the aggregate number of shares available under the
Plan may be appropriately adjusted by the Committee, whose determination shall
be conclusive. No adjustment to either (i) the number or price of shares of
Common Stock subject to Incentive Stock Options or (ii) the aggregate number of
shares which may be issued as Incentive Stock Options shall be permitted
hereunder to the extent that such adjustment would cause an Incentive Stock
Option to fail to constitute an Incentive Stock Option within the meaning of
section 422 of the Code.


12. AMENDMENT AND TERMINATION OF THE PLAN

     The Board may amend the Plan at any time; provided that no change in any
Award theretofore granted may be made that would impair the rights of the
Holder without the consent of the Holder, and provided, further, that it may
not, without approval of the shareholders, amend the Plan (a) to increase the
maximum aggregate number of shares which may be issued under the Plan or (b) to
change the class of individuals eligible to receive Awards under the Plan. The
Board, in its discretion, may terminate the Plan at any time with respect to
any shares of Common Stock for which Awards have not theretofore been granted.





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13. EFFECT OF THE PLAN

     (a) No Right to an Award. Neither the adoption of the Plan nor any action
of the Board or of the Committee shall be deemed to give an employee or
Director any right to be granted an Option to purchase Common Stock, a right to
a Restricted Stock Award or a right to a Performance Award or Incentive Award
or any other rights hereunder except as may be evidenced by an Option or Award
agreement duly executed on behalf of the Company, and then only to the extent
and on the terms and conditions expressly set forth therein. The Plan shall be
unfunded. The Company shall not be required to establish any special or
separate fund or to make any other segregation of funds or assets to assure the
payment of any Award.

     (b) No Employment/Membership Rights Conferred. Nothing contained in the
Plan shall (i) confer upon any employee any right with respect to continuation
of employment with the Company or (ii) interfere in any way with the right of
the Company to terminate his or her employment at any time. Nothing contained
in the Plan shall confer upon any Director any right with respect to
continuation of membership on the Board.

     (c) Other Laws; Withholding. The Company shall not be obligated to issue
any shares of Common Stock until there has been compliance with such laws and
regulations as the Company may deem applicable. No fractional shares of Common
Stock shall be delivered. The Company shall have the right to deduct in
connection with all Awards any taxes required by law to be withheld and to
require any payments required to enable it to satisfy its withholding
obligations.

     (d) No Restriction on Corporate Action. Nothing contained in the Plan
shall be construed to prevent the Company from taking any corporate action
which is deemed by the Company to be appropriate or in its best interests,
whether or not such action would have an adverse effect on the Plan or any
Award made under the Plan. No employee, Director, beneficiary, or other person
shall have any claim against the Company as a result of any such action.

     (e) Restrictions on Transfer. An Award (other than an Incentive Stock
Option) which shall be subject to the transfer restrictions set forth in
Section 7(f) shall not be transferable or assignable otherwise than (i) by will
or the laws of descent and distribution, (ii) pursuant to a "qualified domestic
relations order" (as defined by the Code), (iii) with respect to Awards of
Non-Qualified Stock Options, as provided in Section 7(f)(iii), or (iv) with the
consent of the Committee.

     (f) Section 162(m). It is intended that the Plan comply fully with and
meet all the requirements of section 162(m) of the Code so that Options granted
hereunder and, if determined by the Committee, Restricted Stock Awards and
Performance Awards shall constitute "performance-based" compensation within the
meaning of such section. If any provision of the Plan would disqualify the Plan
or would not otherwise permit the Plan to comply with section 162(m) as so
intended, such provision shall be construed or deemed amended to conform to the
requirements or provisions of section 162(m); provided that no such
construction or amendment shall have an adverse effect on the economic value to
a Holder of any Award previously granted hereunder.

     (g) Governing Law. This Plan shall be construed in accordance with the
laws of the State of Texas.





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