Exhibit 3(a)                                   

                                   
                                   AMENDED

                                      AND

                                   RESTATED

                         CERTIFICATE OF INCORPORATION

                                      OF

                            THE QUAKER OATS COMPANY

                              SEPTEMBER 11, 1996

                            THE QUAKER OATS COMPANY

                         Certificate of Incorporation

                                       

              Organized Under the Laws of the State of New Jersey

                           Authorized Capital Stock

                Preference, without par value, 1,000,000 shares

                Preferred, without par value, 10,000,000 shares

                    Common, $5 par value 400,000,000 shares

                                       

                 Original Certificate Filed September 21, 1901

                                       

                        Amendment Filed March 31, 1906

             Increasing preferred capital stock from $8,000,000 to

                                  $9,000,000

            and common capital stock from $4,000,000 to $4,500,000.

                                       

                        Amendment Filed April 25, 1910

        Increasing common capital stock from $4,500,000 to $5,500,000.

                                       

                       Amendment Filed November 25, 1912

        Increasing common capital stock from $5,500,000 to $10,000,000.

                                       

                         Amendment Filed April 7, 1917

             Increasing preferred capital stock from $9,000,000 to

                                  $15,000,000

           and common capital stock from $10,000,000 to $15,000,000.

                         Amendment Filed July 14, 1919

            Increasing preferred capital stock from $15,000,000 to

                                  $25,000,000

           and common capital stock from $15,000,000 to $25,000,000.

                                       

                        Amendment Filed March 14, 1925

         No change in preferred capital stock. Changing common capital

                  stock to 600,000 shares without par value.

                                       

                        Amendment Filed March 20, 1930

        No change in preferred capital stock. Increasing common capital

                  stock to 800,000 shares without par value.

                                       

                       Amendment Filed January 19, 1951

             No change in preferred capital stock. Changing Common

                   Stock to 4,000,000 shares, $5 par value.

                                       

                       Amendment Filed November 14, 1958

        No change in preferred capital stock. Changing Common Stock to

                        6,000,000 shares, $5 par value.

                                       

                       Amendment Filed November 3, 1967

             No change in preferred capital stock. Changing Common

                   Stock to 12,000,000 shares, $5 par value.

                       Amendment Filed November 1, 1968

            Eliminating 6% Preferred Capital Stock, $100 par value.

                                  Authorizing

         169,022 shares of $3 Cumulative Convertible Preferred Stock,

                                $50 par value.

                 Authorizing 1,500,000 shares Preference Stock

                              without par value.

           Changing Common Stock to 15,000,000 shares, $5 par value.

                                       

                       Amendment Filed November 7, 1969

          No change in Preferred or Preference Stock. Changing Common

                   Stock to 22,500,000 shares, $5 par value.

                                       

                       Amendment Filed December 10, 1971

          No change in Preferred or Preference Stock.  Elimination of

                      preemptive rights on Common Stock.

                                       

                       Amendment Filed November 16, 1972

          No change in Preferred or Preference Stock. Changing Common

                   Stock to 35,000,000 shares, $5 par value.

                                       

                         Amendment Filed May 21, 1975

          No change in Common or Preferred Stock. Providing for issue

         of a series of Preference Stock without par value, designated

            "$9.56 preference stock," consisting of 500,000 shares.

                    Amended and Restated November 28, 1978

                   No change in Common or Preference Stock.

                      Elimination of $3 Preferred Stock.

                                       

                       Amendment Filed November 22, 1983

               No change in Common or Preference Stock. Amended

       Article Sixth of, and added Article Seventh to, the Certificate.

                                       

                      Amendments Filed November 15, 1984

                        No change in Preference Stock.

          Changing Common Stock to 100,000,000 shares, $5 par value,

             and authorizing 10,000,000 shares of Preferred Stock

                              without par value.

                   Added Article Eighth to the Certificate.

                        Principal Office in New Jersey:

                         The Corporation Trust Company

                             28 West State Street

                           Trenton, New Jersey 08608

                               General Offices:

                 321 N. Clark Street, Chicago, Illinois 60610

                                       

                          Amendment Filed May 5, 1986

                    No Change in Common or Preferred Stock.

                    Elimination of $9.56 Preference Stock.

                                       

                      Amendment Filed September 18, 1986

                   No change in Common or Preference Stock.


           Provided for series of Preferred Stock without par value

          designated "Series A Junior Participating Preferred Stock."


                                       
                       Amendment Filed November 12, 1986
                  No change in Preference or Preferred Stock.

          Changing Common Stock to 200,000,000 shares, $5 par value.

                                       

                       Amendment Filed November 11, 1987

              No change in Common, Preference or Preferred Stock.

                Amended Certificate to add a new Article Ninth.

                                       

                       Amendment Filed November 9, 1988

          No change in Common, Preference or Preferred Stock. Amended

             Certificate to add a new Article Fourth, Paragraph C.

                                       

                         Amendment Filed June 19, 1989

          No change in Common, Preference or Preferred Stock. Amended

                    Certificate to add a New Series B ESOP

                         Convertible Preferred Stock.

                                       

                       Amendment Filed January 13, 1993

              No change in Common, Preference or Preferred Stock.

                 Amended Certificate to amend Article Eighth.

                       Amendment Filed November 9, 1994

                  No change in Preference or Preferred Stock.

          Changing Common Stock to 400,000,000 shares, $5 par value.

                       Registered Office in New Jersey:

                         The Corporation Trust Company

                             820 Bear Tavern Road

                            West Trenton, NJ 08628

                                       

                      Amendment Filed September 11, 1996

                   No change in Common or Preference Stock.

           Retired Series of Preferred without par value designated

              "Series A Junior Participating Preferred Stock" and

           provided for Series of Preferred Stock without par value

         designated "Series C Junior Participating Preference Stock".

                                       

                                    AMENDED

                                      AND

                                   RESTATED

                         CERTIFICATE OF INCORPORATION

                                      OF

                            THE QUAKER OATS COMPANY

                              SEPTEMBER 11, 1996

                                       

      Pursuant to the provisions of Section 14A:9-5 of the New Jersey  Business

Corporation Act, The Quaker Oats Company, a corporation organized and  existing

under  the  laws  of  the  State  of New Jersey, restates  and  integrates  its

Certificate of Incorporation, as heretofore amended, to read in full as  herein

set forth:



      First.         The  name of  the Corporation is: The Quaker Oats Company.



      Second.        The address of the Corporation's current registered office

is 820 Bear Tavern  Road,  West Trenton, New Jersey  08628.   The  name  of the

Corporation's  current  registered agent at such  address,  upon  whom  process

against the Corporation may be served, is The Corporation Trust Company.



      Third.         The purposes for which the Corporation is organized are to

engage in any or all activities within the purposes for which corporations  now

or  at  any  time  hereafter may be organized under  the  New  Jersey  Business

Corporation  Act  and  under  all amendments and supplements  thereto,  or  any

revision thereof or any statute enacted to take the place thereof.



      Fourth.        The aggregate number of shares which the Corporation shall

have  authority to issue is 411,000,000 shares divided into 400,000,000  shares

of  common  stock  of  the par value of $5.00 per share,  1,000,000  shares  of

preference  stock  without par value and 10,000,000 shares of  preferred  stock

without par value.

      The designations, rights, preferences, privileges and limitations of  the

shares  of  common  stock, shares of preference stock and shares  of  preferred

stock, and the manner of determining the designations, and number of series  of

preference  stock  and  preferred  stock and  the  relative  voting,  dividend,

liquidation  and other rights, preferences and limitations of each such  series

are as follows:



A.   Preference Stock



      (1)   The  Board of Directors is hereby empowered to cause the preference

stock to be issued from time to time for such consideration as it may from time

to  time  fix, and to cause such preference stock to be issued in  series  with

variations as to:



     (a)  the rates of dividends payable thereon,

     (b)  the terms on which the same may be redeemed,

     (c)  the amount which may be paid to the holders thereof,

     (d)  the terms or amount of any sinking fund provided for the purchase  or

     redemption thereof, and

     (e)   the  terms upon which the holders thereof may convert the same  into

     stock of any   other class or classes or of any one or more series of  the

     same class or of another class or classes.



      All  shares of preference stock shall be identical in all respects except

as  above  provided; and shares of preference stock of any one series shall  be

identical  in all respects. If the stated dividends or the amounts  payable  in

any other distribution of assets on all shares of preference stock are not paid

in  full,  the holders of shares of all series of preference stock shall  share

ratably in the payment of dividends, including arrearages, if any, and  in  any

amounts payable in any other distribution of assets in accordance with the sums

that  would  be payable on such shares if all dividends and distributions  were

paid in full.  The holders of each series of preference stock shall be entitled

to  receive, when and as declared by the Board of Directors, dividends, payable

quarterly,  at the rate designated by the Board of Directors in the  resolution

providing  for the issue of such series, and no more.  Such dividends  on  each

series  of  preference stock shall be cumulative whether  or  not  earned.   No

dividends  (other than dividends payable in common stock) shall be declared  or

paid or set apart for payment on the common or preferred stock unless and until

dividends  payable for all past quarterly dividend periods on  the  outstanding

shares of each series of preference stock shall have been paid, or declared and

set apart for payment, in full.  The holders of each series of preference stock

shall  be  entitled to receive, in case of dissolution or any  distribution  of

assets in liquidation, the amount specified for payment in such case, as  fixed

by  the  Board of Directors in the resolution providing for the issue  of  such

series,  and no more.  No payment or distribution shall be made in  respect  of

the  common  or preferred stock, in case of dissolution or any distribution  of

assets  in  liquidation, unless and until the amount specified for  payment  in

such case to the holder of each series of preference stock shall have been paid

in full.



      (2)  The shares of each series of preference stock may be made subject to

redemption in whole or in part, at the option of the Corporation, at such  time

or  times  and at such price or prices and upon such terms as may be prescribed

by  the  Board of Directors in the resolution providing for the issue  of  such

series.  If less than all of the outstanding shares of any series of preference

stock are to be redeemed at a particular time, the shares of such series to  be

so  redeemed shall be chosen by lot or pro rata in such manner as the Board  of

Directors  may determine.  The Corporation may create a sinking  fund  for  the

purchase,  redemption or retirement of any series of preference stock  of  such

amount or proportion of net profit and upon such terms as may be prescribed  by

the  Board  of  Directors in the resolution providing for  the  issue  of  such

series.  Preference  shares redeemed by the Corporation  shall  be  retired  by

resolution  of  the  Board  of Directors and shall not  be  reissued,  and  the

authorized  stock and capital represented by such preference  shares  shall  be

deemed to be reduced accordingly.



      (3)   The  Board of Directors, with respect to each series of  preference

stock, shall decide whether the stock of such series shall be convertible,  and

if  so shall designate in the resolution providing for the issue of such series

the terms upon which such stock may be converted into stock of any other series

of  preference  stock  or into stock of any other class or  classes.  Upon  the

conversion  of shares of preference stock, the preference shares  so  converted

shall  be  deemed to be retired and shall not be reissued, and  the  authorized

stock  and capital represented by such preference shares shall be deemed to  be

reduced accordingly.



      (4)   Subject  to  the  provisions of law  and  of  this  Certificate  of

Incorporation as in effect from time to time, every holder of preference  stock

of  any  series  shall be entitled to one vote in person or by proxy  for  each

share  of  such stock held by him.  If at any time the Corporation  shall  have

failed  to  pay,  or  declare  and  set apart for  payment,  dividends  on  all

outstanding  shares  of preference stock in an amount equal  to  six  quarterly

dividends upon such shares, the number of directors of the Corporation shall be

increased  by  two  at  the  first annual meeting of the  shareholders  of  the

Corporation held thereafter; and at such meeting and at each subsequent  annual

meeting until dividends payable for all past quarterly dividend periods on  all

outstanding  shares of preference stock shall have been paid, or  declared  and

set  apart for payment, in full, the holders of the shares of preference  stock

shall  have the right, voting as a class, to elect such two additional  members

of the Board of Directors to hold office for a term of one year and until their

successors  are elected and qualified; provided, that the right to  vote  as  a

class  upon the election of such two additional directors shall not  limit  the

right  of holders of preference stock to vote upon other matters when permitted

by   other  provisions  of  this  Certificate.   Upon  such  payment,  or  such

declaration  and  setting apart for payment, in full,  the  terms  of  the  two

additional  directors so elected shall forthwith terminate, and the  number  of

directors of the Corporation shall be reduced by two and such additional voting

right  of  the  holders of shares of preference stock shall cease,  subject  to

increase  in  the  number of directors as aforesaid and to  revesting  of  such

voting  right in the event of each and every additional failure in the  payment

of  dividends  in an amount equal to six quarterly dividends as aforesaid.   So

long  as  any  shares  of  the  preference  stock  shall  be  outstanding,  the

Corporation shall not, without the affirmative vote of the holders of at  least

two-thirds  of  the  aggregate  number  of  shares  of  preference  stock  then

outstanding, amend this Certificate to: (a) increase the authorized  preference

stock of the Corporation; (b) authorize any new class of stock ranking equal to

or  prior  to  the  preference  stock, either as to  payment  of  dividends  or

distribution of assets; (c) adversely change the rights, preferences or  powers

of  the  preference  stock  with  respect  to  dividends,  voting,  conversion,

liquidation or redemption.



     (5)  Shares of preference stock of any series shall not entitle any holder

thereof to any preemptive right to purchase or subscribe for any shares of that

or any other class.



B.   Preferred Stock



      (1)   The  Board of Directors is hereby empowered to cause the  preferred

stock to be issued from time to time for such consideration as it may from time

to  time  fix,  and to cause such preferred stock to be issued in  series  with

variations  as to rights, preferences, privileges and limitations as designated

by  the  Board of Directors in the resolution providing for the issue  of  such

series,  except that no series of preferred stock shall rank equal to or  prior

to  any  of  the  preference  stock, either  as  to  payment  of  dividends  or

distribution of assets.  Shares of preferred stock of any one series  shall  be

identical in all respects.

      (2)   Subject  to  the priority of holders of the preference  stock,  the

holders  of  each  series  of  preferred stock shall  be  entitled  to  receive

cumulative, noncumulative or partially cumulative dividends at the rate and  on

the  terms designated by the Board of Directors in the resolution providing for

the  issue  of  such series, and no more.  No dividends (other  than  dividends

payable in common stock) shall be declared or paid or set apart for payment  on

the  common  stock  unless and until all dividends payable on  the  outstanding

shares of each series of preferred stock shall have been paid, or declared  and

set  apart  for  payment, in full.  Subject to the priority of holders  of  the

preference  stock,  the  holders of each series of  preferred  stock  shall  be

entitled  to receive, in case of dissolution or any distribution of  assets  in

liquidation,  the amount specified for payment in such case, as  fixed  by  the

Board  of  Directors in the resolution providing for the issue of such  series,

and no more.  No payment or distribution shall be made in respect of the common

stock,  in  case  of dissolution or any distribution of assets in  liquidation,

unless and until the amount specified for payment in such case to the holder of

each series of preferred stock shall have been paid in full.



      (3)  The shares of each series of preferred stock may be made subject  to

redemption in whole or in part, at the option of the Corporation, at such  time

or  times  and at such price or prices and upon such terms as may be prescribed

by  the  Board of Directors in the resolution providing for the issue  of  such

series.  The Corporation may create a sinking fund for the purchase, redemption

or  retirement of any series of preferred stock of such amount or proportion of

net  profits and upon such terms as may be prescribed by the Board of Directors

in  the  resolution providing for the issue of such series.   Preferred  shares

redeemed  by the Corporation shall be restored to the status of authorized  but

unissued shares of preferred stock not constituting part of any series thereof,

unless the Board of Directors elects to retain such redeemed shares as Treasury

shares.



      (4)   The  Board of Directors, with respect to each series  of  preferred

stock, shall decide whether the stock of such series shall be convertible,  and

if  so shall designate in the resolution providing for the issue of such series

the terms upon which such stock may be converted into stock of any other series

of  preferred  stock  or into stock of any other class  or  classes.  Upon  the

conversion of shares of preferred stock, the preferred share so converted shall

be restored to the status of authorized but unissued shares.



      (5)   Subject  to  the  provisions of law  and  of  this  Certificate  of

Incorporation as in effect from time to time, the holders of preferred stock of

any  series shall be entitled to such voting rights, limited voting rights,  or

special  or  multiple  voting  rights as may be  prescribed  by  the  Board  of

Directors in the resolution providing for the issue of such series.



      (6)  Shares of preferred stock of any series shall not entitle any holder

thereof to any preemptive right to purchase or subscribe for any shares of that

or any other class.



      (7)   The Board of Directors shall have all other powers and rights  with

respect  to the preferred stock which are not inconsistent with the New  Jersey

Business Corporation Act or this Certificate of Incorporation as in effect from

time to time.



      (8)   The  relative  voting,  dividend,  liquidation  and  other  rights,

preferences  and  limitations of the shares of the series  of  preferred  stock

designated "Series C Junior Participating Preferred Stock" are as set forth  in

the resolution of the Board of Directors contained in the document filed in the

office  of  the Secretary of State of New Jersey pursuant to which such  series

was  created,  which  resolution,  marked "Exhibit  A,"  is  attached  to  this

Certificate of Incorporation and made a part hereof as if set forth in full.



       (9)   The  relative  voting,  dividend  liquidation  and  other  rights,

preferences  and  limitations of the shares of the series  of  preferred  stock

designated "Series B ESOP Convertible Preferred Stock" are as set forth in this

Paragraph  Fourth  B  and  in  Exhibit  B  to  this  Restated  Certificate   of

Incorporation, which document has been filed with the Secretary of State of New

Jersey  together with the resolution pursuant to which the series was  created,

and which are both made a part hereof as if set forth in full.



C.   Common Stock



      The  common stock shall be subject to the prior rights of the holders  of

the  preference stock and preferred stock as above declared.  Subject  to  such

prior rights, the Board of Directors may declare and pay dividends out of funds

legally available therefor.  In the event of the dissolution of the Corporation

or  of a distribution of the assets or any portion thereof by way of return  of

capital,  the  holders  of the common stock shall, after  the  holders  of  the

preference stock and preferred stock have received the preferential amounts  to

which  they are entitled, be entitled to receive the balance of the  assets  of

the  Corporation so distributed. Shares of common stock shall not  entitle  the

holder  thereof to any preemptive right to purchase or subscribe of the  shares

of that or any other class.



      Fifth.     The number of Directors constituting the Corporation's current

Board  of  Directors is 10.  The names and business addresses  of  the  persons

currently serving as said Directors are:

                    The Honorable Frank C. Carlucci
                    Chairman
                    The Carlyle Group
                    1001 Pennsylvania Avenue, N.W.
                    Washington, D.C.  20004-2505


                    Mr. Silas S. Cathcart
                    Retired Chairman
                    Illinois Tool Works, Inc.
                    222 Wisconsin Ave.
                    Suite 103
                    Chicago, IL  60645


                    Mr. Kenneth I. Chenault
                    Vice Chairman
                    American Express Company
                    American Express Tower
                    40th Floor
                    World Financial Center
                    200 Vesey Street
                    New York, NY  10285-4000


                    Ms. Judy C. Lewent
                    Senior Vice President
                    & Chief Financial Officer
                    Merck & Co., Inc.
                    One Merck Drive
                    P.O. Box 100
                    Whitehouse Station, NJ  08889-0100


                    Mr. Vernon R. Loucks, Jr.
                    Chairman and Chief Executive Officer
                    Baxter International Inc.
                    One Baxter Parkway
                    Deerfield, IL  60015


                    Dr. Thomas C. MacAvoy
                    Paul M. Hammaker
                    Professor of Business Administration
                    Darden Graduate
                    School of Business Administration
                    University of Virginia
                    Charlottesville, VA  22906
                    
                    Mr. Luther C. McKinney
                    Senior Vice President - Law
                    and Corporate Affairs
                    The Quaker Oats Company
                    Quaker Tower, 27-10
                    P.O. Box 049001
                    Chicago, IL  60604-9001


                    Dr. Walter J. Salmon
                    Stanley Roth Sr.
                    Professor of Retailing
                    Harvard Business School
                    Morgan Hall - Room 175
                    Soldiers Field Road
                    Boston, MA  02163


                    Mr. William D. Smithburg
                    Chairman, President and CEO
                    The Quaker Oats Company
                    Quaker Tower, 27-13
                    P.O. Box 049001
                    Chicago, IL  60604-9001


                    Mr. William L. Weiss
                    Chairman Emeritus
                    Ameritech Corporation
                    One First National Plaza
                    21 S. Clark Street
                    Suite 2530 C
                    Chicago, IL  60603-2006


      Sixth.    The business and affairs of the Corporation shall be managed by

a Board of Directors.  The number of directors (exclusive of directors, if any,

elected  by  the  holders  of one or more classes of preference  stock,  voting

separately  as  a  class  pursuant  to the provisions  of  the  Certificate  of

Incorporation  applicable thereto) shall be not less than 6  or  more  than  24

directors, the exact number of directors to be determined from time to time  by

resolution  adopted by affirmative vote of a majority of the  entire  Board  of

Directors.    The  directors shall be divided into three  classes,   designated

Class  I,  Class  II  and Class III.  Each class shall consist,  as  nearly  as

possible, of one-third of the total number of directors constituting the entire

Board  of  Directors.   At  the 1983 Annual Meeting of  Shareholders,  Class  I

directors  shall be elected for a one-year term, Class II for a  two-year  term

and  Class  III  directors for a three-year term.  At  each  succeeding  annual

meeting of shareholders beginning in 1984, successors to directors whose  terms

expire at that annual meeting shall be of the same class as the directors  they

succeed, and shall be elected for three-year terms.  If the number of directors

is  changed  by resolution of the Board of Directors pursuant to  this  Article

Sixth, any increase or decrease shall be apportioned among the classes so as to

maintain the number of directors in each class as nearly equal as possible, but

in  no case shall a decrease in the number of directors shorten the term of any

incumbent director.

      A  director  shall hold office until the annual meeting for the  year  in

which  his or her term expires and until his or her successor shall be  elected

and  shall  qualify, subject, however, to prior death, resignation, retirement,

or  removal  from  office.  Any newly created directorship  resulting  from  an

increase  in  the  number of directors and any other vacancy on  the  Board  of

Directors, however caused, may be filled by a majority of the directors then in

office,  although less than a quorum, or by a sole remaining director; provided

that  if  the  number of directors is increased, not more than two  such  newly

created  directorships  may be filled by the directors in  any  period  between

annual  meetings  of shareholders. Any director so elected to  fill  a  vacancy

shall,  without regard to the class in which such vacancy occurred, hold office

until  the next succeeding annual meeting of shareholders and until his or  her

successor shall have been elected and qualified. The term of a director elected

by  shareholders  to fill a newly created directorship or other  vacancy  shall

expire  at  the same time as the terms of the other directors of the  class  in

which the vacancy occurred.

      Exclusive  of directors, if any, elected by the holders of  one  or  more

classes  of  preference  stock,  one  or more  or  all  the  directors  of  the

Corporation  may  be removed for cause by the shareholders by  the  affirmative

vote  of two-thirds of the votes cast by the holders of shares entitled to vote

at  a  meeting of shareholders for which proper notice of such proposed removal

has been given.

      No  person shall be eligible for election as a director at any annual  or

special  meeting of shareholders unless a written request that his or her  name

be  placed  in  nomination  is received from a shareholder  of  record  by  the

Secretary of the Corporation not less than 30 days prior to the date fixed  for

the  meeting, together with the written consent of such person to  serve  as  a

director.   Where  such  a request for nomination and such  consent  have  been

timely  received, but such nominee is unable or declines to serve,  the  person

who  placed  the individual's name in nomination may request that an  alternate

name be placed in nomination at the meeting.

      Notwithstanding the foregoing, whenever the holders of any  one  or  more

classes or series of preference stock issued by the Corporation shall have  the

right, voting separately by class or series, to elect directors at an annual or

special  meeting  of  shareholders, the election, term of  office,  filling  of

vacancies  and  other features of such directorships shall be governed  by  the

terms  of  this Certificate of Incorporation applicable thereto.  Directors  so

elected  shall  not be divided into classes unless expressly provided  by  such

terms,  and during the prescribed terms of office of such directors, the  Board

of  Directors  shall consist of such directors in addition  to  the  number  of

directors determined as provided in the first paragraph of this Article Sixth.



      Seventh.   Notwithstanding any other provisions of  this  Certificate  of

Incorporation  or the Bylaws of the Corporation (and notwithstanding  the  fact

that  some  lesser  percentage may be specified by  law),  the  Bylaws  may  be

amended,  altered  or  repealed, and new Bylaws may be  enacted,  only  by  the

affirmative  vote of the holders of not less that two-thirds of the outstanding

shares  of capital stock of the Corporation or by a vote of not less than  two-

thirds of the entire Board of Directors.



      Eighth.   The affirmative vote of the holders of two-thirds of all Voting

Shares  (as  defined herein) of the Corporation considered for the purposes  of

this  Article  Eighth  as  one class, shall be required  for  the  adoption  or

authorization of any Combination as defined herein with any person  if,  as  of

the  record  date  for  the determination of shareholders  entitled  to  notice

thereof  and  to vote thereon, such person is an Interested Shareholder  or  an

affiliate  of an Interested Shareholder; provided, that such two-thirds  voting

requirement  shall  not  be applicable if all of the  conditions  specified  in

either of the following paragraphs (1) or (2) are met:



      (1)   If  the Combination shall have been approved by a majority  of  the

Disinterested  Directors (as defined herein) who were directors  prior  to  the

time  that  such  person  became an Interested Shareholder,  but  only  if  the

Disinterested Directors were a majority of the Board of Directors  before  such

person became an Interested Shareholder.



      (2)  (a)    The  cash,  or  fair  market  value  of  other  consideration

(determined  by the experts provided for in Subparagraph (iii)  below  of  this

Article  Eighth),  to be received per share in the Combination  by  holders  of

common stock of the Corporation is not less than the greatest of:



      (i)   the  highest  per-share  price  (including  brokerage  commissions,

transfer taxes, and soliciting dealer's fees) paid during the preceding  twelve

months  by  the  Interested Shareholder in acquiring the beneficial  ownership,

directly  or  indirectly, of any of its holdings of the  common  stock  of  the

Corporation.   (In  making this computation, appropriate adjustments  shall  be

made  for  any  stock  splits, stock dividends, stock  combinations  and  other

similar events.);



     (ii) the closing price per share of the common stock of the Corporation as

listed on the New York Stock Exchange on the business day immediately preceding

the  date  that the meeting of the shareholders of the Corporation is held  for

the purpose of voting on the Combination;



      (iii)      a  price  that is approved as being fair  to  the  holders  of

outstanding  common  stock  of the Corporation not  owned  by  such  Interested

Shareholder, as determined by at least two independent experts selected  by  at

least three Disinterested Directors.  (This determination shall be based on the

value of the total Corporation in an arm's-length sale.)  The Corporation shall

pay  the  reasonable fees and expenses associated with the retention  of  these

experts; and



      (b)   A  proxy  statement  which complies with the  requirements  of  the

Securities Exchange Act of 1934, as amended, shall be mailed to the holders  of

common  stock  for  the  purpose  of soliciting shareholder  approval  of  such

Combination.  The proxy statement shall contain (as exhibits or otherwise)  the

entire opinions of the independent experts required by this Article Eighth.



The  requirements  of  this  Article Eighth are in  addition  to,  and  do  not

supersede,  amend,  alter, change or eliminate any board approval,  shareholder

vote  or  consent  or other conditions required by the laws of  New  Jersey  in

effect at the time a Combination is proposed.



The following definitions shall apply for the purposes of this Article Eighth:



      A.   "Combination" means a merger or consolidation of the Corporation  or

any  subsidiary of the Corporation with any other corporation, or the  sale  or

lease  of  all  or a substantial part of the assets of the Corporation  or  any

subsidiary  of  the  Corporation to any other person, or any other  transaction

which has achieved substantially the same effect.



      B.    An  "Interested Shareholder" is any person who owns ten percent  or

more of the outstanding Voting Shares of the Corporation.



      C.    A  "person"  includes  a natural person, corporation,  partnership,

association,  joint stock company, trust, unincorporated association  or  other

entity.   When  two or more persons act as a partnership, limited  partnership,

syndicate,  or  other group for the purpose of acquiring, holding,  voting,  or

disposing  of Voting Shares, they shall be deemed a single person for  purposes

of this Article Eighth.



      D.   "Voting Shares" means the issued and outstanding shares of any class

of stock of the Corporation which is entitled to vote generally in the election

of directors.



      E.    Ownership  of  Voting  Shares  includes  beneficial  ownership.   A

beneficial  owner  of  Voting  Shares includes  any  person  who,  directly  or

indirectly, through any contract, options, warrants, convertible securities  or

other  contract  rights  to acquire Voting Shares, arrangement,  understanding,

relationship  or otherwise, has or shares (i) voting power, which includes  the

power  to  vote,  or  to  direct the voting of,  the  Voting  Shares,  or  (ii)

investment  power, which includes the power to dispose of,  or  to  direct  the

disposition of, the Voting Shares.



      F.    A "subsidiary" of the Corporation is any company a majority or more

of the voting securities of which is owned by the Corporation.



      G.    A "Disinterested Director" is a director of the Corporation who (i)

is  not  and never has been an officer or director of an Interested Shareholder

or any affiliate or associate of such Interested Shareholder and is not and has

not  been  for the past five years an employee of an Interested Shareholder  or

any  affiliate or associate of such Interested Shareholder; (ii) does  not  own

more than one percent or 10,000 shares, whichever is the lesser of any class of

equity securities of an Interested Shareholder or any affiliate or associate of

such  Interested Shareholder; (iii) is not the settlor of any trust,  and  does

not  serve as the trustee, executor or in a similar capacity for any  trust  or

estate,  which  owns more than one percent or 10,000 shares, whichever  is  the

lesser, of any class of equity securities of any Interested Shareholder or  any

affiliate or associate of such Interested Shareholder; (iv) is not the relative

of  any person or of the spouse of such person who could not be a Disinterested

Director  because of any of the provisions of the clauses (i), (ii),  or  (iii)

above  who  has  the same home as such person; (v) is not the spouse,  brother,

sister,  son,  daughter, father or mother of any person  who  could  not  be  a

Disinterested Director because of any of the provisions of clauses  (i),  (ii),

or  (iii)  above;  and  (vi) is not otherwise by reason  of  past,  present  or

anticipated  circumstances  unable  to  act  solely  in  the  interest  of  the

Corporation  with  respect  to the Combination, provided  that  no  officer  or

employee  of  the Corporation shall be disqualified from being a  Disinterested

Director solely by reason of being an officer or employee of the Corporation.



      H.    An  "affiliate" of a specified person is a person who directly,  or

indirectly  through one or more intermediaries, controls, or is controlled  by,

or is under common control with, such specified person.



      I.   An "associate" of a specified person is (i) any person of which such

specified  person is an officer or partner or is the owner of  ten  percent  or

more of any class of equity securities, (ii) any trust or other estate in which

such specified person owns ten percent or more of the total beneficial interest

or  as  to  which  such  specified person serves as trustee  or  in  a  similar

fiduciary  capacity, (iii) any relative or spouse of such specified person,  or

any  relative  of such spouse, who has the same home as such specified  person,

(iv)  any person who is a director or officer of such specified person  or  any

corporation  which controls or is controlled by such specified person,  or  (v)

any other member or partner in a partnership, limited partnership, syndicate or

other group, formal or informal, of which such specified person is a member  or

partner  and which is acting together for the purpose of acquiring, holding  or

disposing of securities of the Corporation.



      Enforcement.   The Board of Directors is specifically authorized to  seek

equitable  relief, including an injunction, to enforce the provisions  of  this

Article Eighth.



      Amendment. No amendment to this Certificate of Incorporation shall amend,

alter,  change  or repeal any of the provisions of this Article  Eighth  unless

such  amendment,  in  addition  to receiving any shareholder  vote  or  consent

required  by  the laws of the State of New Jersey in effect at the time,  shall

receive the affirmative vote of the holders of two-thirds of all Voting Shares.



     Ninth.

A.   Limitation of Liability



      To  the  full  extent from time to time permitted by New Jersey  law,  no

director or officer of the Company shall be personally liable to the Company or

its  shareholders for damages for breach of any duty owed to the Company or its

shareholders. Neither the amendment or repeal of this Article, nor the adoption

of  any  provision of this Certificate of Incorporation inconsistent with  this

Article, shall eliminate or reduce the protection afforded by this Article to a

director  or officer of the Company with respect to any matter which  occurred,

or  any cause of action, suit or claim which, but for this Article, would  have

accrued or arisen, prior to such amendment, repeal or adoption.

B.   Indemnification



      (1)   The  Company shall indemnify any person who is or was  a  director,

officer,  employee  or  agent of the Company or of any constituent  corporation

absorbed by the Company in a consolidation or merger, and any person who is  or

was  a  director, officer, trustee, employee or agent of any other  corporation

(domestic   or   foreign)   or  of  any  partnership,   joint   venture,   sole

proprietorship,  trust, employee benefit plan or other enterprise  (whether  or

not  for  profit),  serving as such at the request of the  Company  or  at  the

request of any such constituent corporation, or the legal representative of any

such  director,  officer,  trustee, employee or agent,  against  such  person's

reasonable  costs, disbursements and counsel fees and amounts paid or  incurred

in  satisfaction of settlements, judgments, fines and penalties  in  connection

with  any  pending, threatened or completed civil, criminal, administrative  or

arbitrative  action, suit or proceeding, whether brought in the  right  of  the

Company  or  otherwise, and any appeal therein and any inquiry or investigation

which could lead to such action, suit or proceeding, to the fullest extent  now

or hereafter permitted by New Jersey law.

      (2)   The  Company shall pay expenses as they are incurred by any  person

covered by this Article in connection with any proceeding, as defined above, in

advance of the final disposition of the proceeding to the fullest extent now or

hereafter permitted by New Jersey law.

      (3)  The foregoing indemnification and advancement of expenses shall  not

be  deemed exclusive of any other rights to which any person indemnified may be

entitled.

      (4)  The rights provided to any person under this Article Ninth shall  be

enforceable against the Company by such person, who shall be presumed  to  have

relied upon it in serving or continuing to serve as a director or in any of the

other  capacities  set  forth  in this Article  Ninth.  No  elimination  of  or

amendment  to  this Article Ninth shall deprive any person of rights  hereunder

arising out of alleged or actual occurrences, acts or failures to act occurring

prior to notice to such person of such elimination or amendment.

Dated this 11th day of September, 1996

                              THE QUAKER OATS COMPANY



                              By
                                        Vice President


               (Name and full title)
                                       
                                   EXHIBIT A


      By  resolution  of the Board of Directors there is created  a  series  of
preferred  stock,  no  par value, of the Company (such  preferred  stock  being
herein  referred  to  as  "Preferred  Stock,"  which  term  shall  include  any
additional shares of preferred stock of the same class heretofore or  hereafter
authorized to be issued by the Company), consisting of 4,000,000 shares,  which
shall  be  identical  in  all  respects to the  preferred  stock  described  in
Paragraph Fourth B of the Corporation's Certificate of Incorporation, with such
variations  as  may  be  contained in this Exhibit  A,  and  hereby  fixes  the
designation  and  the  voting powers, preferences and relative,  participating,
optional  or  other  special  rights, and the  qualifications,  limitations  or
restrictions thereof, as follows:

      Section  1.      Designation and Amount.  There  shall  be  a  series  of
Preferred  Stock  of  the Corporation which shall be designated  as  "Series  C
Junior Participating Preferred Stock," no par value (hereinafter called "Series
C Preferred Stock"), and the number of shares constituting such series shall be
4,000,000.   Such number of shares may be increased or decreased by  resolution
of  the  Board of Directors and by the filing of a certificate pursuant to  the
provisions  of the Business Corporation Act of the State of New Jersey  stating
that such increase or reduction has been so authorized; provided, however, that
no decrease shall reduce the number of shares of Series C Preferred Stock to  a
number  less than that of the shares then outstanding plus the number of shares
of  Series  C  Preferred  Stock issuable upon exercise of  outstanding  rights,
options or warrants or upon conversion of outstanding securities issued by  the
Corporation.

     Section 2.     Dividends and Distributions.
          (A)   Subject to the prior and superior rights of the holders of  any
shares  of  any  series of Preferred Stock ranking prior and  superior  to  the
shares  of  Series C Preferred Stock with respect to dividends, the holders  of
shares  of Series C Preferred Stock shall be entitled to receive, when, as  and
if  declared by the Board of Directors out of funds legally available  for  the
purpose,  quarterly dividends payable in cash to holders of record on the  last
business  day  of March, June, September and December in each year  (each  such
date  being  referred  to  herein  as  a "Quarterly  Dividend  Payment  Date"),
commencing  on  the  first  Quarterly Dividend Payment  Date  after  the  first
issuance of a share or fraction of a share of Series C Preferred Stock,  in  an
amount  per  share (rounded to the nearest cent) equal to the  greater  of  (a)
$1.00 or (b) subject to the provision for adjustment hereinafter set forth, 100
times  the aggregate per share amount of all cash dividends, and 100 times  the
aggregate per share amount (payable in kind) of all non-cash dividends or other
distributions  other  than  a  dividend  payable  in  shares  of  Common  Stock
(hereinafter  defined)  or a subdivision of the outstanding  shares  of  Common
Stock  (by  reclassification or otherwise), declared on the Common  Stock,  par
value  $5.00  per  share,  of the Corporation (the "Common  Stock")  since  the
immediately preceding Quarterly Dividend Payment Date, or, with respect to  the
first Quarterly Dividend Payment Date, since the first issuance of any share or
fraction  of a share of Series C Preferred Stock.  In the event the Corporation
shall  at  any time following July 31, 1996 (i) declare any dividend on  Common
Stock  payable in shares of Common Stock, (ii) subdivide the outstanding Common
Stock  or  (iii) combine the outstanding Common Stock into a smaller number  of
shares, then in each such case the amount to which holders of shares of  Series
C  Preferred  Stock were entitled immediately prior to such event under  clause
(b) of the preceding sentence shall be adjusted by multiplying each such amount
by  a  fraction the numerator of which is the number of shares of Common  Stock
outstanding  immediately after such event and the denominator of which  is  the
number  of  shares of Common Stock that were outstanding immediately  prior  to
such event.

          (B)   The Corporation shall declare a dividend or distribution on the
Series  C  Preferred Stock as provided in paragraph (A) above at  the  time  it
declares  a dividend or distribution on the Common Stock (other than a dividend
payable in shares of Common Stock).

          (C)    No dividend or distribution (other than a dividend payable  in
shares  of  Common Stock) shall be paid or payable to the holders of shares  of
Common  Stock  unless, prior thereto, all accrued but unpaid dividends  to  the
date  of  such dividend or distribution shall have been paid to the holders  of
shares of Series C Preferred Stock.

          (D)  Dividends shall begin to accrue and be cumulative on outstanding
shares  of  Series C Preferred Stock from the Quarterly Dividend  Payment  Date
next  preceding  the date of issue of such shares of Series C Preferred  Stock,
unless  the  date of issue of such shares is prior to the record date  for  the
first  Quarterly Dividend Payment Date, in which case dividends on such  shares
shall begin to accrue from the date of issue of such shares, or unless the date
of  issue  is a Quarterly Dividend Payment Date or is a date after  the  record
date  for  the  determination of holders of shares of Series C Preferred  Stock
entitled  to  receive a quarterly dividend and before such  Quarterly  Dividend
Payment  Date, in either of which events such dividends shall begin  to  accrue
and  be  cumulative  from such Quarterly Dividend Payment  Date.   Accrued  but
unpaid  dividends  shall not bear interest.  Dividends paid on  the  shares  of
Series  C  Preferred  Stock in an amount less than the  total  amount  of  such
dividends at the time accrued and payable on such shares shall be allocated pro
rata  on  a share-by-share basis among all such shares at the time outstanding.
The  Board of Directors may fix a record date for the determination of  holders
of shares of Series C Preferred Stock entitled to receive payment of a dividend
or  distribution declared thereon, which record date shall be no more  than  30
days prior to the date fixed for the payment thereof.

     Section 3.     Voting Rights.  The holders of shares of Series C Preferred
Stock shall have the following voting rights:

          (A)    Subject to the provision for adjustment hereinafter set forth,
each one one-hundredth of a share of Series C Preferred Stock shall entitle the
holder  thereof  to  one  vote  on all matters  submitted  to  a  vote  of  the
shareholders  of the Corporation.  In the event the Corporation  shall  at  any
time  following July 31, 1996 (i) declare any dividend on Common Stock  payable
in shares of Common Stock, (ii) subdivide the outstanding Common Stock or (iii)
combine  the outstanding Common Stock into a smaller number of shares, then  in
each  such  case the number of votes per share to which holders  of  shares  of
Series C Preferred Stock were entitled immediately prior to such event shall be
adjusted by multiplying such number by a fraction the numerator of which is the
number  of shares of Common Stock outstanding immediately after such event  and
the  denominator  of which is the number of shares of Common  Stock  that  were
outstanding immediately prior to such event.

           (B)   Except as otherwise provided herein or by law, the holders  of
shares  of  Series C Preferred Stock and the holders of shares of Common  Stock
and  any  other  capital stock of the Corporation having general voting  rights
shall  vote  together  as  one class on all matters  submitted  to  a  vote  of
shareholders of the Corporation.

           (C)   (i)  Whenever, at any time or times, dividends payable on  any
share  or  shares of Series C Preferred Stock shall be in arrears in an  amount
equal  to  at  least six full quarterly dividends (whether or not declared  and
whether or not consecutive), the holders of record of the outstanding Preferred
Stock  shall have the exclusive right, voting separately as a single class,  to
elect two directors of the Corporation at a special meeting of shareholders  of
the  Corporation  or at the Corporation's next annual meeting of  shareholders,
and  at each subsequent annual meeting of shareholders, as provided below.   At
elections for such directors, the holders of shares of Series C Preferred Stock
shall  be  entitled to cast one vote for each one one-hundredth of a  share  of
Series C Preferred Stock held.

                (ii)  Upon  the  vesting of such right of the  holders  of  the
Preferred  Stock,  the maximum authorized number of members  of  the  Board  of
Directors  shall  automatically be increased by two and the  two  vacancies  so
created  shall  be  filled by vote of the holders of the outstanding  Preferred
Stock  as hereinafter set forth.  A special meeting of the shareholders of  the
Corporation  then  entitled to vote shall be called  by  the  Chairman  or  the
President or the Secretary of the Corporation, if requested in writing  by  the
holders of record of not less than 10% of the Preferred Stock then outstanding.
At such special meeting, or, if no such special meeting shall have been called,
then at the next annual meeting of shareholders of the Corporation, the holders
of the shares of the Preferred Stock shall elect, voting as above provided, two
directors  of  the Corporation to fill the aforesaid vacancies created  by  the
automatic increase in the number of members of the Board of Directors.  At  any
and  all  such  meetings for such election, the holders of a  majority  of  the
outstanding  shares of the Preferred Stock shall be necessary to  constitute  a
quorum  for such election, whether present in person or by proxy, and such  two
directors  shall be elected by the vote of at least a plurality of shares  held
by  such  shareholders  present or represented at the  meeting.   Any  director
elected  by  holders of shares of the Preferred Stock pursuant to this  Section
may  be removed at any annual or special meeting, by vote of a majority of  the
shareholders  voting  as  a class who elected such director,  with  or  without
cause.   In  case  any vacancy shall occur among the directors elected  by  the
holders  of the Preferred Stock pursuant to this Section, such vacancy  may  be
filled  by the remaining director so elected, or his successor then in  office,
and  the  director so elected to fill such vacancy shall serve until  the  next
meeting  of  shareholders for the election of directors.  After the holders  of
the  Preferred Stock shall have exercised their right to elect Directors in any
default  period  and  during  the continuance of such  period,  the  number  of
Directors  shall not be further increased or decreased except by  vote  of  the
holders of Preferred Stock as herein provided or pursuant to the rights of  any
equity  securities ranking senior to or pari passu with the Series C  Preferred
Stock.

                (iii)      The  right  of the holders of the  Preferred  Stock,
voting separately as a class, to elect two members of the Board of Directors of
the Corporation as aforesaid shall continue until, and only until, such time as
all arrears in dividends (whether or not declared) on the Preferred Stock shall
have  been paid or declared and set apart for payment, at which time such right
shall  terminate,  except as herein or by law expressly  provided,  subject  to
revesting  in  the event of each and every subsequent default of the  character
above-mentioned.   Upon  any termination of the right of  the  holders  of  the
shares  of  the  Preferred  Stock as a class to vote for  directors  as  herein
provided,  the  term of office of all directors then in office elected  by  the
holders   of   Preferred  Stock  pursuant  to  this  Section  shall   terminate
immediately.   Whenever  the term of office of the  directors  elected  by  the
holders of the Preferred Stock pursuant to this Section shall terminate and the
special voting powers vested in the holders of the Preferred Stock pursuant  to
this Section shall have expired, the maximum number of members of the Board  of
Directors of the Corporation shall be such number as may be provided for in the
By-laws of the Corporation, irrespective of any increase made pursuant  to  the
provisions of this Section.

           (D)  Except as set forth herein, holders of Series C Preferred Stock
shall  have  no special voting rights and their consent shall not  be  required
(except to the extent they are entitled to vote with holders of Common Stock as
set forth herein) for taking any corporate action.

     Section 4.     Certain Restrictions.
          (A)  Whenever quarterly dividends or other dividends or distributions
payable  on  the  Series C Preferred Stock as provided  in  Section  2  are  in
arrears,   thereafter   and  until  all  accrued  and  unpaid   dividends   and
distributions,  whether or not declared, on shares of Series C Preferred  Stock
outstanding shall have been paid in full, the Corporation shall not:

                (i)   declare or pay dividends on, make any other distributions
on, or redeem or purchase or otherwise acquire for consideration any shares  of
stock  ranking junior (either as to dividends or upon liquidation,  dissolution
or winding up) to the Series C Preferred Stock;

               (ii)   declare  or  pay    dividends  on   or  make  any   other
distributions  on  any  shares of stock ranking  on  a  parity  (either  as  to
dividends  or  upon liquidation, dissolution or winding up) with the  Series  C
Preferred Stock, except dividends paid ratably on the Series C Preferred  Stock
and  all  such  parity stock on which dividends are payable or  in  arrears  in
proportion  to  the total amounts to which the holders of all such  shares  are
then entitled;

              (iii)   redeem or purchase or otherwise acquire for consideration
shares  of  any  stock  ranking on a parity (either as  to  dividends  or  upon
liquidation,  dissolution  or winding up) with the Series  C  Preferred  Stock,
provided  that  the Corporation may at any time redeem, purchase  or  otherwise
acquire shares of any such parity stock in exchange for shares of any stock  of
the  Corporation  ranking junior (either as to dividends or  upon  dissolution,
liquidation or winding up) to the Series C Preferred Stock; or

               (iv)  purchase or otherwise acquire for consideration any shares
of Series C Preferred Stock, except in accordance with a purchase offer made in
writing  or  by  publication (as determined by the Board of Directors)  to  all
holders  of  such  shares  upon such terms as the  Board  of  Directors,  after
consideration of the respective annual dividend rates and other relative rights
and  preferences of the respective series and classes, shall determine in  good
faith  will result in fair and equitable treatment among the respective  series
or classes.

           (B)   The  Corporation  shall  not  permit  any  subsidiary  of  the
Corporation  to purchase or otherwise acquire for consideration any  shares  of
stock  of the Corporation unless the Corporation could, under paragraph (A)  of
this  Section, purchase or otherwise acquire such shares at such  time  and  in
such manner.

      Section 5.     Reacquired Shares.  Any shares of Series C Preferred Stock
purchased  or  otherwise acquired by the Corporation in any  manner  whatsoever
shall  be  retired and cancelled promptly after the acquisition  thereof.   All
such shares shall upon their cancellation become authorized but unissued shares
of  Preferred  Stock and may be reissued as part of a new series  of  Preferred
Stock  to  be  created by resolution or resolutions of the Board of  Directors,
subject to the conditions and restrictions on issuance set forth herein.

     Section 6.     Liquidation, Dissolution or Winding Up.

          (A)  Upon any voluntary liquidation, dissolution or winding up of the
Corporation,  no distribution shall be made to the holders of shares  of  stock
ranking  junior  (either  as to dividends or upon liquidation,  dissolution  or
winding  up) to the Series C Preferred Stock unless, prior thereto, the holders
of shares of Series C Preferred Stock shall have received $1.00 per share, plus
an  amount  equal  to  accrued and unpaid dividends and distributions  thereon,
whether or not declared, to the date of such payment (the "Series C Liquidation
Preference").   Following  the  payment of the full  amount  of  the  Series  C
Liquidation  Preference,  no additional distributions  shall  be  made  to  the
holders  of  shares  of  Series C Preferred Stock unless,  prior  thereto,  the
holders of shares of Common Stock shall have received an amount per share  (the
"Common Adjustment") equal to the quotient obtained by dividing (i) the  Series
C Liquidation Preference by (ii) 100 (as appropriately adjusted as set forth in
subparagraph  C  below to reflect such events as stock splits, stock  dividends
and  recapitalizations with respect to the Common Stock) (such number in clause
(ii),  the  "Adjustment Number").  Following the payment of the full amount  of
the Series C Liquidation Preference and the Common Adjustment in respect of all
outstanding  shares of Series C Preferred Stock and Common Stock, respectively,
holders of Series C Preferred Stock and holders of shares of Common Stock shall
receive  their ratable and proportionate share of the remaining  assets  to  be
distributed in the ratio, on a per share basis, of the Adjustment Number  to  1
with  respect  to such Preferred Stock and Common Stock, on a per share  basis,
respectively.

           (B)   In  the  event, however, that there are not sufficient  assets
available to permit payment in full of the Series C Liquidation Preference  and
the  liquidation preferences of all other series of Preferred  Stock,  if  any,
which  rank on a parity with the Series C Preferred Stock, then such  remaining
assets  shall  be distributed ratably to the holders of such parity  shares  in
proportion to their respective liquidation preferences.

           (C)   In the event the Corporation shall at any time following  July
31,  1996 (i) declare any dividend on Common Stock payable in shares of  Common
Stock,  (ii)  subdivide  the  outstanding Common Stock  or  (iii)  combine  the
outstanding  Common Stock into a smaller number of shares, then  in  each  such
case  the Adjustment Number in effect immediately prior to such event shall  be
adjusted  by multiplying such Adjustment Number by a fraction the numerator  of
which  is  the  number of shares of Common Stock outstanding immediately  after
such event and the denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.

      Section 7.     Consolidation, Merger, etc.  In case the Corporation shall
enter into any consolidation, merger, combination or other transaction in which
the  shares  of Common Stock are exchanged for or changed into other  stock  or
securities, cash and/or any other property, then in any such case the shares of
Series  C  Preferred  Stock shall at the same time be  similarly  exchanged  or
changed  in  an  amount  per  share (subject to the  provision  for  adjustment
hereinafter  set  forth)  equal to 100 times the  aggregate  amount  of  stock,
securities, cash and/or any other property (payable in kind), as the  case  may
be, into which or for which each share of Common Stock is changed or exchanged.
In  the  event  the Corporation shall at any time (i) declare any  dividend  on
Common  Stock payable in shares of Common Stock, (ii) subdivide the outstanding
Common  Stock  or  (iii) combine the outstanding Common Stock  into  a  smaller
number  of shares, then in each such case the amount set forth in the preceding
sentence with respect to the exchange or change of shares of Series C Preferred
Stock  shall be adjusted by multiplying such amount by a fraction the numerator
of  which is the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.

     Section 8.     Redemption.  The shares of a Series C Preferred Stock shall
not  be redeemable by the Corporation.  The preceding sentence shall not  limit
the ability of the Corporation to purchase or otherwise deal in such shares  of
stock to the extent permitted by law.

     Section 9.     Ranking.  The Series C Preferred Stock shall rank junior to
all  other series of the Corporation's preferred stock (whether with or without
par  value)  as  to  the payment of dividends and the distribution  of  assets,
unless the terms of any such series shall provide otherwise.

     Section  10.   Amendment.   The   Certificate   of  Incorporation  of  the
Corporation shall not be amended in any manner which would materially alter  or
change  the  powers,  preferences or special rights of the Series  C  Preferred
Stock  so  as  to  affect them adversely without the affirmative  vote  of  the
holders  of a majority or more of the outstanding shares of Series C  Preferred
Stock, voting separately as a class.

      Section 11.    Fractional Shares.  Series C Preferred Stock may be issued
in  fractions of a share which shall entitle the holder, in proportion to  such
holder's  fractional  shares,  to exercise voting  rights,  receive  dividends,
participate  in  distributions and to have the benefit of all other  rights  of
holders of Series C Preferred Stock.


                                   EXHIBIT B

      By unanimous written consent of the Board of Directors of The Quaker Oats
Company  dated  June  16, 1989, there is created a series  of  Preferred  Stock
designated "Series B ESOP Convertible Preferred Stock" which shall be identical
in  all respects to the preferred stock described in Paragraph Fourth 3 of  the
Corporation's  Restated Certificate of Incorporation, with such  variations  as
may be contained in the following description:

     Section 1.     Designation and Amount; Special Purpose Restricted Transfer
Issue.
           (A)  The shares of such series shall be designated as "Series B ESOP
Convertible  Preferred Stock"("Series B Preferred Stock")  and  the  number  of
shares constituting such series shall be 1,750,000.

           (B)  Shares of Series B Preferred Stock shall be issued only to  The
Northern  Trust Company, as trustee (the "Trustee") of The 1989 Quaker Employee
Stock  Ownership  Trust  under The Quaker Employee  Stock  Ownership  Plan,  as
amended  (the  "Plan").  All references to the holder of  shares  of  Series  B
Preferred  Stock shall mean the Trustee or any successor or trustee  under  the
Plan.   In the event of any transfer of record ownership of shares of Series  B
Preferred Stock to any person other than any successor trustee under the  Plan,
the  shares of Series B Preferred Stock so transferred, upon such transfer  and
without  any further action by the Corporation or the holder thereof, shall  be
automatically  converted into shares of common stock of  the  Corporation  (the
"Common Stock") pursuant to Section 5 hereof and no such transferee shall  have
any of the voting powers, preferences and relative, participating, optional  or
special  rights  ascribed to shares of Series B Preferred Stock hereunder  but,
rather,  only the powers and rights pertaining to the Common Stock  into  which
such shares of Series B Preferred Stock shall be so converted.  In the event of
such  a  conversion, the transferee of the shares of Series B  Preferred  Stock
shall  be treated for all purposes as the record holder of the shares of Common
Stock   into  which  such  shares  of  Series  B  Preferred  Stock  have   been
automatically  converted  as  of  the  date  of  such  transfer.   Certificates
representing shares of Series B Preferred Stock shall bear a legend to  reflect
the  foregoing  provisions.  Notwithstanding the foregoing provisions  of  this
paragraph  (B)  of  Section 1, shares of Series B Preferred Stock  (i)  may  be
converted into shares of Common Stock as provided by Section 5 hereof  and  the
shares  of Common Stock issued upon such conversion may be transferred  by  the
holder  thereof  as  permitted  by law and (ii)  shall  be  redeemable  by  the
Corporation  upon  the terms and conditions provided by Sections  6,  7  and  8
hereof.

     Section 2.     Dividends and Distributions.
           (A)   Subject  to  the rights of the holders of  any  stock  of  the
Corporation  ranking  senior  to the Series B Preferred  Stock  in  respect  of
dividends  and subject to the provisions for adjustment hereinafter set  forth,
the holders of shares of Series B Preferred Stock shall be entitled to receive,
when,  as  and  if  declared by the Board of Directors  out  of  funds  legally
available  therefor, cumulative cash dividends ("Preferred  Dividends")  in  an
amount  per  share  equal to $5.46 per share per annum, and  no  more,  payable
quarterly in arrears, one-fourth on each fifteenth day of January, April,  July
and  October of each year (each a "Dividend Payment Date") commencing  on  July
15,  1989,  to  holders  of record at the start of business  on  such  Dividend
Payment  Date.  In the event that any Dividend Payment Date shall fall  on  any
day  other than a "Business Day" (as hereinafter defined), the dividend payment
due on such dividend Payment Date shall be paid on the Business Day immediately
succeeding  such  Dividend Payment Date.  Preferred Dividends  shall  begin  to
accrue  on  outstanding shares of Series B Preferred Stock  from  the  date  of
issuance of such shares of Series B Preferred Stock.  Preferred Dividends shall
accrue on a daily basis, but Preferred Dividends accrued after issuance on  the
shares  of  Series B Preferred Stock for any period less than a full  quarterly
period between Dividend Payment Dates shall be computed on the basis of a  360-
day  year  of  30-day  months.  Accrued but unpaid  Preferred  Dividends  shall
cumulate  as  of the Dividend Payment Date on which they first became  payable,
but no interest shall accrue on accumulated but unpaid Preferred Dividends.

           (B)   So  long  as any shares of Series B Preferred Stock  shall  be
outstanding, no dividend shall be declared or paid or set apart for payment  on
any other series of stock ranking on a parity with the Series B Preferred Stock
as  to dividends, unless there shall also be or have been declared and paid  or
set  apart  for  payment  on the Series B Preferred  Stock  dividends  for  all
dividend  payment periods of the Series B Preferred Stock ending on  or  before
the  dividend payment date of such parity stock, ratably in proportion  to  the
respective  amounts of dividends accumulated and unpaid through  such  dividend
period  on  the  Series B Preferred Stock and accumulated and  unpaid  on  such
parity  stock  through the dividend payment period on such  parity  stock  next
preceding  such  dividend  payment date. In  the  event  that  full  cumulative
dividends  on the Series B Preferred Stock have not been declared and  paid  or
set apart for payment when due, the Corporation shall not declare or pay or set
apart for payment any dividends or make any other distributions on, or make any
payment on account of the purchase, redemption or other retirement of any other
class of stock or series thereof of the Corporation ranking, as to dividends or
as to distributions in the event of a liquidation, dissolution or winding-up of
the  Corporation, junior to the Series B Preferred Stock until full  cumulative
dividends on the Series B Preferred Stock shall have been paid or declared  and
set apart for payment; provided, however, that the foregoing shall not apply to
(i)  any  dividend  payable solely in any shares of any stock  ranking,  as  to
dividends and as to distributions in the event of a liquidation, dissolution or
winding-up of the Corporation, junior to the Series B Preferred Stock  or  (ii)
the  acquisition  of  shares of any stock ranking as  to  dividends  or  as  to
distributions in the event of a liquidation, dissolution or winding-up  of  the
Corporation,  junior  to the Series B Preferred Stock in  exchange  solely  for
shares  of any other stock ranking, as to dividends and as to distributions  in
the event of a liquidation, dissolution or winding-up of the Corporation junior
to the Series B Preferred Stock.

     Section 3.     Voting Rights.  The holders of shares of Series B Preferred
Stock shall have the following voting rights:

          (A)  The  holders  of Series B Preferred Stock shall be entitled  to
vote on all matters submitted to a vote of the stockholders of the Corporation,
voting  together with the holders of Common Stock as one class.  The holder  of
each  share of Series B Preferred Stock shall be entitled to a number of  votes
equal to the number of shares of Common Stock into which such share of Series B
Preferred  Stock  could  be converted on the record date  for  determining  the
stockholders entitled to vote, rounded to the nearest one-tenth of a  vote;  it
being understood that whenever the "Conversion Price" (as defined in Section  5
hereof) is adjusted as provided in Section 9 hereof, the voting rights  of  the
Series B Preferred Stock shall also be similarly adjusted.

          (B)  Except as otherwise required by law or set forth herein, holders
of  Series  B  Preferred Stock shall have no special voting  rights  and  their
consent  shall not be required (except to the extent they are entitled to  vote
with  holders  of  Common Stock as set forth herein)  for  the  taking  of  any
corporate action; provided, however, that the vote of at least 66-2/3%  of  the
outstanding shares of Series B Preferred Stock, voting separately as a  series,
shall  be  necessary  to  adopt any alteration,  amendment  or  repeal  of  any
provision  of  the  Restated Certificate of Incorporation  of  the  Corporation
(including any such alteration, amendment or repeal effected by any  merger  or
consolidation  in  which  the  Corporation  is  the  surviving   or   resulting
corporation), if such amendment, alteration or repeal would alter or change the
powers,  preferences,  or special rights of the shares of  Series  B  Preferred
stock so as to affect them adversely.

     Section 4.     Liquidation, Dissolution or Winding Up.

           (A)   Upon any voluntary or involuntary liquidation, dissolution  or
winding up of the Corporation, the holders of Series B Preferred Stock shall be
entitled  to  receive  out  of  assets of the Corporation  which  remain  after
satisfaction  in  full of all valid claims of creditors of the Corporation  and
which  are available for payment to stockholders, and subject to the rights  of
the  holders of any stock of the Corporation ranking senior to or on  a  parity
with  the Series B Preferred Stock in respect of distribution upon liquidation,
dissolution or winding up of the Corporation, before any amount shall  be  paid
or  distributed  among the holders of Common Stock or any other shares  ranking
junior  to  the  Series  B  Preferred Stock in respect  of  distributions  upon
liquidation,  dissolution  or  winding  up  of  the  Corporation,   liquidating
distributions in the amount of $78.00 per share (the "Liquidation Preference"),
plus  an  amount equal to all accrued and unpaid dividends thereon to the  date
fixed  for distribution, and no more.  If upon any liquidation, dissolution  or
winding up of the Corporation, the amounts payable with respect to the Series B
Preferred  Stock and any other Stock ranking as to any such distribution  on  a
parity  with the Series B Preferred Stock are not paid in full, the holders  of
the  Series B Preferred Stock and such other stock shall share ratably  in  any
distribution  of  assets  in  proportion to the  full  respective  preferential
amounts to which they are entitled.  After payment of the full amount to  which
they are entitled as provided by the foregoing provisions of this Section 4(A),
the  holders of shares of Series B Preferred Stock shall not be entitled to any
further right or claim to any of the remaining assets of the Corporation.

           (B)  Neither the merger or consolidation of the Corporation with  or
into  any  other  corporation, nor the merger or  consolidation  of  any  other
corporation  with  or into the Corporation, nor the sale,  lease,  exchange  or
other transfer of all or any portion of the assets of the Corporation, shall be
deemed  to  be a dissolution, liquidation or winding up of the affairs  of  the
Corporation  for  purposes  of this Section 4, but  the  holders  of  Series  B
Preferred Stock shall nevertheless be entitled in the event of any such  merger
or consolidation to the rights provided by Section 8 hereof.

           (C)   Written  notice  of any voluntary or involuntary  liquidation,
dissolution or winding up of the Corporation, stating the payment date or dates
when,  and  the place or places where, the amounts distributable to holders  of
Series B Preferred Stock in such circumstances shall be payable, shall be given
by  first-class  mail, postage prepaid, mailed not less than twenty  (20)  days
prior  to any payment date stated therein, to the holders of Series B Preferred
Stock,  at  the address shown on the books of the Corporation or  any  transfer
agent for the Series B Preferred Stock.

     Section 5.     Conversion into Common Stock.

           (A)   A  holder  of  shares  of Series B Preferred  Stock  shall  be
entitled,  at  any time prior to the close of business on the  date  fixed  for
redemption of such shares pursuant to Sections 6, 7 and 8 hereof, to cause  any
or all of such shares to be converted into shares of Common Stock, initially at
a conversion rate equal to the ratio of:

               (i)  $78.00; to

              (ii)  the amount which initially shall be $78.00, and which shall
                    be adjusted as hereinafter provided  (and, as  so adjusted,
                    rounded  to  the  nearest ten-thousandth,  is   hereinafter
                    sometimes  referred  to  as  the  "Conversion Price") (that
                    is, a conversion rate initially equivalent to one  share of
                    Common Stock for each  share  of  Series  B Preferred Stock
                    so  converted,  which  is   subject   to adjustment as  the
                    Conversion  Price  is   adjusted  as hereinafter provided).

           (B)   Any  holder of shares of Series B Preferred Stock desiring  to
convert such shares into shares of Common Stock shall surrender the certificate
or  certificates  representing the shares of Series  B  Preferred  Stock  being
converted,  duly  assigned  or endorsed for transfer  to  the  Corporation  (or
accompanied  by duly executed stock powers relating thereto), at the  principal
executive  office of the Corporation or the offices of the transfer  agent  for
the  Series  B  Preferred Stock or such office or offices  in  the  continental
United States of an agent for conversion as may from time to time be designated
by  notice to the holders of the Series B Preferred Stock by the Corporation or
the  transfer  agent for the Series B Preferred Stock, accompanied  by  written
notice  of conversion.  Such notice of conversion shall specify (i) the  number
of  shares of Series B Preferred Stock to be converted and the name or names in
which  such holder wishes the certificate or certificates for Common Stock  and
for  any shares of Series B Preferred Stock not to be so converted to be issued
and  (ii) the address to which such holder wishes delivery to be made  of  such
new certificates to be issued upon such conversion.

           (C)   Upon surrender of a certificate representing a share or shares
of  Series  B Preferred Stock for conversion, the Corporation shall  issue  and
send by hand delivery (with receipt to be acknowledged) or by first class mail,
postage  prepaid,  to the holder thereof or to such holder's designee,  at  the
address designated by such holder, a certificate or certificates for the number
of  shares  of  Common  Stock  to  which such holder  shall  be  entitled  upon
conversion.  In the event that there shall have been surrendered a  certificate
or  certificates representing shares of Series B Preferred Stock, only part  of
which  are  to  be converted, the Corporation shall issue and deliver  to  such
holder or such holder's designee a new certificate or certificates representing
the  number  of  shares of Series B Preferred Stock which shall not  have  been
converted.

          (D)  The issuance by the Corporation of shares of Common Stock upon a
conversion  of shares of Series B Preferred Stock into shares of  Common  Stock
made  at  the option of the holder thereof shall be effective as of the earlier
of  (i)  the  delivery  to  such  holder  or  such  holder's  designee  of  the
certificates  representing the shares of Common Stock  issued  upon  conversion
thereof  or (ii) the commencement of business on the second business day  after
the  surrender of the certificate or certificates for the shares  of  Series  B
Preferred Stock to be converted, duly assigned or endorsed for transfer to  the
Corporation (or accompanied by duly executed stock powers relating thereto)  as
provided by this Resolution.  On and after the effective day of conversion, the
person  or  persons  entitled to receive the Common Stock  issuable  upon  such
conversion shall be treated for all purposes as the record holder or holders of
such  shares of Common Stock, but no allowance or adjustment shall be  made  in
respect  of  dividends payable to holders of Common Stock  in  respect  of  any
period prior to such effective date.  The Corporation shall not be obligated to
pay  any  dividends  which shall have been declared and  shall  be  payable  to
holders  of  shares of Series B Preferred Stock on a Dividend Payment  Date  if
such  Dividend  Payment Date for such dividend is subsequent to  the  effective
date of conversion of such shares.

           (E)  The Corporation shall not be obligated to deliver to holders of
Series  B  Preferred  Stock any fractional share of a  share  of  Common  Stock
issuable upon any conversion of such shares of Series B Preferred Stock, but in
lieu thereof may make a cash payment in respect thereof in any manner permitted
by law.

           (F)   The  Corporation shall at all times reserve and keep available
out  of its authorized and unissued Common Stock, solely for issuance upon  the
conversion of shares of Series B Preferred Stock as herein provided, free  from
any preemptive rights, such number of shares of Common Stock as shall from time
to time be issuable upon the conversion of all the shares of Series B Preferred
Stock   then   outstanding.   Nothing  contained  herein  shall  preclude   the
Corporation from issuing shares of Common Stock held in its treasury  upon  the
conversion of shares of Series B Preferred Stock into Common Stock pursuant  to
the  terms hereof. The Corporation shall prepare and shall use its best efforts
to  obtain and keep in force such governmental or regulatory permits  or  other
authorizations  as  may  be  required  by  law,  and  shall  comply  with   all
requirements as to registration or qualification of the Common Stock, in  order
to  enable  the  Corporation lawfully to issue and deliver to  each  holder  of
record of Series B Preferred Stock such number of shares of its Common Stock as
shall from time to time be sufficient to effect the conversion of all shares of
Series B Preferred Stock then outstanding and convertible into shares of Common
Stock.
     Section 6.     Redemption At the Option of the Corporation.
          (A)  The Series B Preferred Stock shall be redeemable, in whole or in
part,  at  any  time  after the date of issuance, to the  extent  permitted  by
paragraphs  6(D)  and  8(C), at the following percentages  of  the  Liquidation
Preference:

            During the Twelve            Percentage of
               Month Period               Liquidation
            Beginning June 15              Preference

                   1989                      107.0%
                   1990                      106.3%
                   1991                      105.6%
                   1992                      104.9%
                   1993                      104.2%
                   1994                      103.5%
                   1995                      102.8%
                   1996                      102.1%
                   1997                      101.4%
                   1998                      100.7%

and  thereafter  at the Liquidation Preference, plus, in each case,  an  amount
equal  to  all  accrued  and unpaid dividends thereon to  the  date  fixed  for
redemption. Payment of the redemption price shall be made by the Corporation in
cash  or  shares  of Common Stocks or a combination thereof,  as  permitted  by
paragraph (E) of this Section 6.  From and after the date fixed for redemption,
dividends  on  shares  of Series B Preferred Stock called for  redemption  will
cease to accrue, such shares will no longer be deemed to be outstanding and all
rights  in  respect of such shares of the Corporation shall cease,  except  the
right  to  receive the redemption price.  If less than all of  the  outstanding
shares  of  Series B Preferred Stock are to be redeemed, the Corporation  shall
either redeem a portion of the shares of each holder determined pro rata  based
on  the number of shares held by each holder or shall select the shares  to  be
redeemed  by  lot,  as  may  be determined by the Board  of  Directors  of  the
Corporation.

           (B)   Unless  otherwise required by law, notice  of  any  redemption
effected  pursuant  to Sections 6 or 7 hereof will be sent to  the  holders  of
Series  B  Preferred Stock at the address shown on the books of the Corporation
or  any  transfer agent for the Series B Preferred Stock by first  class  mail,
postage prepaid, mailed not less than thirty (30) days nor more than sixty (60)
days  prior  to  the  redemption date. Each such notice shall  state:  (i)  the
redemption  date;  (ii) the total number of shares of the  Series  B  Preferred
stock to be redeemed and, if fewer than all the shares held by such holder  are
to  be  redeemed,  the number of such shares to be redeemed from  such  holder;
(iii)  the  redemption price; (iv) the place or places where  certificates  for
such  shares are to be surrendered for conversion or payment of the  redemption
price; (v) that dividends on the shares to be redeemed will cease to accrue  on
such  redemption  date; and (vi) the conversion rights  of  the  shares  to  be
redeemed, the period within which conversion rights may be exercised,  and  the
Conversion  Price and number of shares of Common Stock issuable upon conversion
of  a  share  of  Series B Preferred Stock at the time. Upon surrender  of  the
certificate  for  any  shares  so  called for  redemption  and  not  previously
converted  (properly  endorsed  or assigned  for  transfer,  if  the  Board  of
Directors  of the Corporation shall so require and the notice shall so  state),
such  shares  shall  be  redeemed by the Corporation  at  the  date  fixed  for
redemption  and  at  the redemption price set forth in paragraph  (A)  of  this
Section 6.

           (C)   In the event of a change in the federal tax law of the  United
States  of  America  which has the effect of precluding  the  Corporation  from
claiming any of the tax deductions for dividends paid on the Series B Preferred
Stock  when such dividends are used as provided under Section 404(k)(2) of  the
Internal  Revenue Code of 1986, as amended, as in effect on the date shares  of
Series B Preferred Stock are initially issued, or if the Plan is determined  by
the  Internal Revenue Service not to be initially qualified within the  meaning
of  Sections  401(a) and 4975(e)(7) of the Internal Revenue Code  of  1986,  as
amended,  the  Corporation  may,  in its sole discretion,  and  notwithstanding
anything to the contrary in paragraph (A) of this Section 6, within 60 days  of
such  event, elect to redeem any or all of such shares for the greater  of  (A)
the  Fair  Market  Value of the shares of Series B Preferred  Stock  to  be  so
redeemed or (B) the amount payable in respect of the shares upon liquidation of
the Corporation pursuant to Section 4 hereof.

           (D)  In the event that the Plan is terminated in accordance with its
terms,  and notwithstanding anything to the contrary in paragraph (A)  of  this
Section  6, the Corporation shall, as soon thereafter as practicable, call  for
redemption  all  then  outstanding shares of Series B Preferred  Stock  for  an
amount  equal to the greater of the Fair Market Value or the redemption  price,
as calculated pursuant to Section 6(A).  The Corporation shall give 30 Business
Days'  notice  to  all  record holders of Preferred Stock  prior  to  any  such
termination, provided, however, that the failure to give any such notice  shall
not affect the validity of such corporate action.

           (E)   The  Corporation,  at its option,  may  make  payment  of  the
redemption price required upon redemption of shares of Series B Preferred Stock
in  cash  or  in shares of Common Stock or in a combination of such shares  and
cash,  any such shares of Common Stock to be valued for such purposes at  their
Fair Market Value (as defined in paragraph (G) of Section 9 hereof).

     Section 7.     Other Redemption Rights.

           Shares  of  Series  B  Preferred Stock  shall  be  redeemed  by  the
Corporation  for  cash or, if the Corporation so elects, in  shares  of  Common
Stock,  or  a  combination of such shares and Cash, any such shares  of  Common
Stock to be valued for such purpose as provided by paragraph (E) of Section  6,
at  the  redemption price as set forth in the following sentence, at the option
of  the holder at any time and from time to time upon notice to the Corporation
given  not  less  than five (5) Business Days prior to the date  fixed  by  the
holder in such notice for such redemption, upon certification by such holder to
the  Corporation of the following events:  (i) when and to the extent necessary
for  such  holder  to  provide  for  distributions  required  to  be  made   to
participants  under,  or  to  satisfy  an  investment  election   provided   to
participants in accordance with, the Plan, or any successor plan; (ii) when and
to  the  extent  necessary for such holder to make any payments  of  principal,
interest or premium due and payable (whether as scheduled or upon acceleration)
under  (a)  the  Loan Agreement between the Trustee and the  lenders,  (b)  any
refinancing  of or substitution for either of the foregoing; or (c)  any  other
indebtedness incurred by the holder for the benefit of the Plan; or ( iii )  in
the  event  that  the Plan is not initially determined by the Internal  Revenue
Service  to be qualified within the meaning of Sections 401(a) and 4975(e)  (7)
of  the  Internal  Revenue Code of 1986, as amended. The redemption  price  for
shares of Series B Preferred Stock to be redeemed under this Section 7 shall be
equal  to: (I) in the case of clause (i) next above, the Fair Market  Value  of
the  shares of Series B Preferred Stock to be so redeemed; (II) in the case  of
clause  (ii) next above, the greater of (A) the Fair Market Value of the shares
of  Series B Preferred Stock to be so redeemed or (B) the redemption price  set
forth  in  paragraph (A) of Section 6 hereof; or (III) in the  case  of  clause
(iii)  next  above, the greater of (A) the Fair Market Value of the  shares  of
Series B Preferred Stock to be so redeemed or (B) the amount payable in respect
of the shares upon liquidation of the Corporation pursuant to Section 4 hereof.

     Section 8.     Consolidation, Merger, etc.

           (A)   In  the  event  that  the  Corporation  shall  consummate  any
consolidation or merger or similar business combination, pursuant to which  the
outstanding shares of Common Stock are by operation of law exchanged solely for
or  changed,  reclassified or converted solely into stock of any  successor  or
resulting  corporation  (including the Corporation) that constitutes  "employer
securities"  with  respect to a holder of Series B Preferred Stock  within  the
meaning of Section 409(1) of the Internal Revenue Code of 1986, as amended. and
"qualifying employer securities" within the meaning of Section 407(d)(5) of the
Employee  Retirement Income Security Act of 1974, as amended, or any  successor
provisions of law, and, if applicable, for a cash payment in lieu of fractional
shares, if any, the shares of Series B Preferred Stock of such holder shall, in
connection with such consolidation, merger or similar business combination,  be
converted into and exchanged for preferred stock of such successor or resulting
corporation,  having in respect of such corporation, insofar as  possible,  the
same powers, preferences and relative, participating, optional or other special
rights  (including  the  redemption rights provided by  Sections  6,  7  and  8
hereof), and the qualifications, limitations or restrictions thereon, that  the
Series B Preferred Stock had immediately prior to such transaction, except that
after  such  transaction each share of the Series B Preferred  Stock  shall  be
convertible,  otherwise  on  the terms and conditions  provided  by  Section  5
hereof,  into  the  number  and  kind  of  qualifying  employer  securities  so
receivable by a holder of the number of shares of Common Stock into which  such
shares of Series B Preferred Stock could have been converted immediately  prior
to  such transaction; provided, however, that if by virtue of the structure  of
such transaction, a holder of Common Stock is required to make an election with
respect  to  the  nature  and kind of consideration  to  be  received  in  such
transaction,  which election cannot practicably be made by the holders  of  the
Series B Preferred Stock, then the shares of Series B Preferred Stock shall, by
virtue  of  such transaction and on the same terms as apply to the  holders  of
Common Stock, be converted into or exchanged for the aggregate amount of stock,
securities, cash or other property (payable in kind) receivable by a holder  of
the  number  of  shares  of Common Stock into which such  shares  of  Series  B
Preferred Stock could have been converted immediately prior to such transaction
if  such  holder of Common Stock failed to exercise any rights of  election  to
receive any kind or amount of stock, securities, cash or other property  (other
than such qualifying employer securities and a cash payment, if applicable,  in
lieu of fractional shares) receivable upon such transaction (provided that,  if
the  kind  or  amount  of qualifying employer securities receivable  upon  such
transaction  is  not the same for each nonelecting share,  then  the  kind  and
amount so receivable upon such transaction for each non-electing share shall be
the  kind  and  amount  so receivable per share by the plurality  of  the  non-
electing shares). The rights of the Series B Preferred Stock as preferred stock
of  such  successor or resulting corporation shall successively be  subject  to
adjustments pursuant to Section 9 hereof after any such transaction  as  nearly
equivalent as practicable to the adjustment provided for by such section  prior
to  such  transaction.  The Corporation shall not consummate any  such  merger,
consolidation  or  similar  transaction  unless  the  successor  or   resulting
corporation shall have agreed to recognize and honor the rights of the  holders
of shares of Series B Preferred Stock as set forth in this paragraph (A).

           (B)   In  the  event  that  the  Corporation  shall  consummate  any
consolidation or merger or similar business combination, pursuant to which  the
outstanding  shares of Common Stock are by operation of law  exchanged  for  or
changed,  reclassified or converted into other stock or securities or  cash  or
any   other  property,  or  any  combination  thereof,  other  than  any   such
consideration which is constituted solely of qualifying employer securities (as
referred  to  in  paragraph  (A)  of this Section  8)  and  cash  payments,  if
applicable,  in  lieu  of fractional shares, outstanding  shares  of  Series  B
Preferred Stock shall, without any action on the part of the Corporation or any
holder  thereof (but subject to paragraph (C) of this Section 8), be deemed  to
have been automatically converted immediately prior to the consummation of such
merger,  consolidation  or similar transaction into the  number  of  shares  of
Common Stock into which such shares of Series B Preferred Stock could have been
converted at such time so that each share of Series B Preferred Stock shall, by
virtue  of  such transaction and on the same terms as apply to the  holders  of
Common Stock, be converted into or exchanged for the aggregate amount of stock,
securities,  cash  or  other property (payable in like kind)  receivable  by  a
holder of the number of shares of Common Stock into which such shares of Series
B  Preferred  Stock  could  have  been  converted  immediately  prior  to  such
transaction;  provided, however, that if by virtue of  the  structure  of  such
transaction,  a  holder of Common Stock is required to make  an  election  with
respect  to  the  nature  and kind of consideration  to  be  received  in  such
transaction.  which election cannot practicably be made by the holders  of  the
Series B Preferred Stock, then the shares of Series B Preferred Stock shall, by
virtue  of  such transaction and on the same terms as apply to the  holders  of
Common Stock, be converted into or exchanged for the aggregate amount of stock,
securities, cash or other property (payable in kind) receivable by a holder  of
the  number  of  shares  of Common Stock into which such  shares  of  Series  B
Preferred Stock could have been converted immediately prior to such transaction
if  such holder of Common Stock failed to exercise any rights of election as to
the kind or amount of stock, securities, cash or other property receivable upon
such  transaction  (provided that, if the kind or amount of stock,  securities,
cash  or  other property receivable upon such transaction is not the  same  for
each non-electing share, then the kind and amount of stock, securities, cash or
other  property  receivable upon such transaction for each  non-electing  share
shall be the kind and amount so receivable per share by a plurality of the non-
electing shares).

           (C)   In  the  event the Corporation shall enter into any  agreement
providing  for  any  consolidation or merger or  similar  business  combination
described  in  paragraph (3) of this Section 8, then the Corporation  shall  as
soon  as  practicable thereafter (and in any event at least  10  Business  Days
before  the closing of such transaction) give notice of such agreement and  the
material terms thereof to each holder of Series B Preferred Stock and each such
holder shall have the right to elect, by written notice to the Corporation,  to
receive, upon consummation of such transaction (if and when such transaction is
consummated),  from  the Corporation or the successor of  the  Corporation,  in
redemption  and  retirement of such Series B Preferred Stock,  a  cash  payment
equal  to  the higher of the redemption price as determined in accordance  with
paragraph 6(A) or the Fair Market Value of shares of Series B Preferred  Stock.
No such notice of redemption shall be effective unless given to the Corporation
prior  to the close of business on the second Business Day prior to the closing
of such transaction, unless the Corporation or the successor of the Corporation
shall  waive such prior notice, but any notice of redemption so given prior  to
such  time  may  be withdrawn by notice of withdrawal given to the  Corporation
prior  to the close of business on the second Business Day prior to the closing
of such transaction.

     Section 9.     Anti-dilution Adjustments.
           (A)  In the event the Corporation shall, at any time or from time to
time  while  any of the shares of the Series B Preferred Stock are outstanding,
(i)  pay  a dividend or make a distribution in respect of the Common  Stock  in
shares  of Common Stock, (ii) subdivide the outstanding shares of Common Stock,
or  (iii) combine the outstanding shares of Common Stock into a smaller  number
of shares, in each case whether by reclassification of shares, recapitalization
of  the  Corporation  (including a recapitalization effected  by  a  merger  or
consolidation  to  which  Section B hereof does not apply)  or  otherwise,  the
Conversion  Price in effect immediately prior to such action shall be  adjusted
by  multiplying such Conversion Price by a fraction, the numerator of which  is
the number of shares of Common Stock outstanding immediately before such event,
and  the  denominator  of  which  is  the number  of  shares  of  Common  Stock
outstanding immediately after such event. An adjustment made pursuant  to  this
paragraph  9(A)  shall  be given effect, upon payment of  such  a  dividend  or
distribution,  as  of  the  record date for the determination  of  stockholders
entitled to receive such dividend or distribution (on a retroactive basis)  and
in  the case of a subdivision or combination shall become effective immediately
as of the effective date thereof.

           (B)   In  the event that the Corporation shall, at any time or  from
time  to  time  while  any  of  the shares of  Series  B  Preferred  Stock  are
outstanding,  issue  to  holders of shares of Common Stock  as  a  dividend  or
distribution,  including  by  way  of  a  reclassification  of  shares   or   a
recapitalization of the Corporation, any right or warrant to purchase shares of
Common  Stock  (but not including as such a right or warrant (i)  any  security
convertible into or exchangeable for shares of Common Stock and (ii) any rights
issued  pursuant  to the Rights Agreement dated as of May 8, 1996  between  the
Corporation  and Harris Trust & Savings Bank, as the same may be  amended  from
time to time) at a purchase price per share less than the Fair Market Value (as
hereinafter defined) of a share of Common Stock on the date of issuance of such
right or warrant, then, subject to the provisions of paragraphs (E) and (F)  of
this  Section  9,  the Conversion Price shall be adjusted by  multiplying  such
Conversion Price by a fraction, the numerator of which shall be the  number  of
shares  of Common Stock outstanding immediately before such issuance of  rights
or  warrants plus the number of shares of Common Stock which could be purchased
at  the  Fair  Market  Value of a share of Common Stock at  the  time  of  such
issuance for the maximum aggregate consideration payable upon exercise in  full
of  all  such  rights or warrants, and the denominator of which  shall  be  the
number  of shares of Common Stock outstanding immediately before such  issuance
of  rights  or warrants plus the maximum number of shares of Common Stock  that
could be acquired upon exercise in full of all such rights and warrants.

           (C)  In the event the Corporation shall, at any time or from time to
time  while  any  of  the shares of Series B Preferred Stock  are  outstanding,
issue, sell or exchange shares of Common Stock (other than pursuant to (i)  any
right  or  warrant  to  purchase or acquire shares of Common  Stock  for  which
adjustment has been made pursuant to paragraph (B) of this Section 9 (including
as  such  a right or warrant any security convertible into or exchangeable  for
shares  of Common Stock) and (ii) any employee or director incentive or benefit
plan   or  arrangement,  including  any  employment,  severance  or  consulting
agreement,  of the Corporation or any subsidiary of the Corporation  heretofore
or  hereafter adopted) for a consideration having a Fair Market Value,  on  the
date  of  such issuance, sale or exchange, less than the Fair Market  Value  of
such  shares  on the date of issuance, sale or exchange, then, subject  to  the
provisions  of  paragraphs (E) and (F) of this Section 9, the Conversion  Price
shall  be  adjusted  by multiplying such Conversion Price by  a  fraction,  the
numerator  of which shall be the sum of (i) the Fair Market Value  of  all  the
shares  of Common Stock outstanding on the day immediately preceding the  first
public  announcement  of such issuance, sale or exchange  plus  (ii)  the  Fair
Market  Value  of the consideration received by the Corporation in  respect  of
such  issuance, sale or exchange of shares of Common Stock, and the denominator
of which shall be the product of (a) the Fair Market Value of a share of Common
Stock  on the day immediately preceding the first public announcement  of  such
issuance, sale or exchange multiplied by (b) the sum of the number of shares of
Common Stock outstanding on such day plus the number of shares of Common  Stock
so  issued, sold or exchanged by the Corporation.  In the event the Corporation
shall,  at any time or from time to time while any shares of Series B Preferred
Stock are outstanding, issue, sell or exchange any right or warrant to purchase
or  acquire  shares of Common Stock (including as such a right or  warrant  any
security  convertible into or exchangeable for shares of Common  Stock),  other
than  any  such issuance to holders of shares of Common Stock as a dividend  or
distribution  (including  by  way  of  a  reclassification  of  shares   or   a
recapitalization of the corporation) and other than pursuant to any employee or
director  incentive or benefit plan or arrangement (including  any  employment,
severance or consulting agreement) of the Corporation or any subsidiary of  the
Corporation heretofore or hereafter adopted, for a consideration having a  Fair
Market Value, on the date of such issuance, sale or exchange, less than the Non-
Dilutive  Amount (as hereinafter defined), then, subject to the  provisions  of
paragraphs  (E)  and  (F)  of  this Section 9, the Conversion  Price  shall  be
adjusted  by  multiplying such Conversion Price by a fraction the numerator  of
which shall be the sum of (I) the Fair Market Value of all the shares of Common
Stock   outstanding  on  the  day  immediately  preceding  the   first   public
announcement of such issuance, sale or exchange plus (II) the Fair Market Value
of  the  consideration received by the Corporation in respect of such issuance,
sale  or exchange of such right or warrant plus (III) the Fair Market Value  at
the  time  of  such  issuance of the consideration which the Corporation  would
receive  upon  exercise  in  full  of all such  rights  or  warrants,  and  the
denominator  of which shall be the product of (i) the Fair Market  Value  of  a
share  of  Common  Stock  on  the day immediately preceding  the  first  public
announcement of such issuance, sale or exchange multiplied by (ii) the  sum  of
the  number of shares of Common Stock outstanding on such day plus the  maximum
number of shares of Common Stock which could be acquired pursuant to such right
or  warrant  at  the time of the issuance, sale or exchange of  such  right  or
warrant  (assuming shares of Common Stock could be acquired  pursuant  to  such
right or warrant at such time).

           (D)  In the event the Corporation shall, at any time or from time to
time  while any of the shares of Series B Preferred Stock are outstanding, make
an Extraordinary Distribution (as hereinafter defined) in respect of the Common
Stock,  whether  by  dividend,  distribution,  reclassification  of  shares  or
recapitalization   of   the  Corporation  (including  a   recapitalization   or
reclassification  effected  by a merger or consolidation  to  which  Section  8
hereof does not apply) or effect a Pro Rata Repurchase (as hereinafter defined)
of  Common  Stock,  the Conversion Price in effect immediately  prior  to  such
Extraordinary Distribution or Pro Rata Repurchase shall, subject to  paragraphs
(E) and (F) of this Section 9, be adjusted by multiplying such Conversion Price
by  the fraction the numerator of which is (i) the Fair Market Value of all the
shares of Common Stock outstanding on the day before the ex-dividend date  with
respect  to  an  Extraordinary Distribution which is paid in cash  and  on  the
distribution date with respect to an Extraordinary Distribution which  is  paid
other  than  in  cash,  or  on the applicable expiration  date  (including  all
extensions thereof) of any tender offer which is a Pro Rata Repurchase,  or  on
the  date  of purchase with respect to any Pro Rata Repurchase which is  not  a
tender  offer,  as  the case may be, minus (ii) the Fair Market  Value  of  the
Extraordinary  Distribution or the aggregate purchase price  of  the  Pro  Rata
Repurchase,  as  the  case may be, and the denominator of which  shall  be  the
product  of  (a)  the number of shares of Common Stock outstanding  immediately
before  such  Extraordinary Distribution or Pro Rata Repurchase minus,  in  the
case of a Pro Rata Repurchase, the number of shares of Common Stock repurchased
by the Corporation multiplied by (b) the Fair Market Value of a share of Common
Stock  on  the  day before the exdividend date with respect to an Extraordinary
Distribution which is paid in cash and on the distribution date with respect to
an  Extraordinary  Distribution which is paid other than in  cash,  or  on  the
applicable  expiration date (including all extensions thereof)  of  any  tender
offer which is a Pro Rata Repurchase or on the date of purchase with respect to
any  Pro Rata Repurchase which is not a tender offer, as the case may be.   The
Corporation  shall send each holder of Series B Preferred Stock (i)  notice  of
its intent to make any dividend or distribution and (ii) notice of any offer by
the  Corporation to make a Pro Rata Repurchase, in each case at the  same  time
as,  or  as  soon  as  practicable  after, such  offer  is  first  communicated
(including by announcement of a record date in accordance with the rules of any
stock  exchange on which the Common Stock is listed or admitted to trading)  to
holders  of Common Stock.  Such notice shall indicate the intended record  date
and  the  amount and nature of such dividend or distribution, or the number  of
shares  subject to such offer for a Pro Rata Repurchase and the purchase  price
payable  by  the Corporation pursuant to such offer, as well as the  Conversion
Price  and the number of shares of Common Stock into which a share of Series  B
Preferred Stock may be converted at such time.

           (E)   Notwithstanding any other provisions of this  Section  9,  the
Corporation  shall  not be required to make any adjustment  to  the  Conversion
Price  unless such adjustment would require an increase or decrease of at least
one  percent  (1%)  in  the Conversion Price.  Any lesser adjustment  shall  be
carried forward and shall be made no later than the time of, and together with,
the  next  subsequent  adjustment  which,  together  with  any  adjustment   or
adjustments so carried forward, shall amount to an increase or decrease  of  at
least one percent (1%) in the Conversion Price.

           (F)   If the Corporation shall make any dividend or distribution  on
the  Common  Stock  or  issue any Common Stock, other capital  stock  or  other
security  of the Corporation or any rights or warrants to purchase  or  acquire
any  such security, which transaction does not result in an adjustment  to  the
Conversion  Price pursuant to the foregoing provisions of this Section  9,  the
Board of Directors of the Corporation shall consider whether such action is  of
such  a  nature that an adjustment to the Conversion Price should equitably  be
made in respect of such transaction.  If in such case the Board of Directors of
the Corporation determines that an adjustment to the Conversion Price should be
made,  an adjustment shall be made effective as of such date, as determined  by
the  Board of Directors of the Corporation (which adjustment shall in no  event
adversely  affect the powers, preferences, or special rights of this  Series  B
Preferred  Stock  as  set forth herein).  The determination  of  the  Board  of
Directors  of  the  Corporation as to whether an adjustment to  the  Conversion
Price  should  be made pursuant to the foregoing provisions of  this  paragraph
9(F), and, if so, as to what adjustment should be made and when, shall be final
and  binding  on the Corporation and all stockholders of the Corporation.   The
Corporation  shall  be  entitled  to make such additional  adjustments  in  the
Conversion Price, in addition to those required by the foregoing provisions  of
this  Section  9,  as  shall  be  necessary  in  order  that  any  dividend  or
distribution  in  shares  of  capital stock of  the  Corporation,  subdivision,
reclassification  or combination of shares of stock of the Corporation  or  any
recapitalization of the Corporation shall not be taxable to the holders of  the
Common Stock.

           (G)   For purposes of  this  Resolution, the  following  definitions
shall apply:

                "Business  Day"  shall mean each day that is  not  a  Saturday,
Sunday  or a day on which state or federally chartered banking institutions  in
Chicago, Illinois or New York, New York are not required to be open.

               "Current Market Price" of publicly traded shares of Common Stock
or any other class of capital stock or other security of the Corporation or any
other issuer for any day shall mean the last reported sales price, regular way,
or,  in  the  event that no sale takes place on such day, the  average  of  the
reported  closing bid and asked prices, regular way, in either case as reported
on  the  New  York  Stock Exchange Composite Tape or, if such security  is  not
listed  or  admitted to trading on the New York Stock Exchange on the principal
national  securities exchange on which such security is listed or  admitted  to
trading  or,  if  not listed or admitted to trading on any national  securities
exchange,  on  the NASDAQ National Market System or, if such  security  is  not
quoted on such National Market System, the average of the closing bid and asked
prices  on  each such day in the over-the-counter market as reported by  NASDAQ
or,  if bid and asked prices for such security on each such day shall not  have
been  reported through NASDAQ, the average of the bid and asked prices for such
day as furnished by any New York Stock Exchange member firm regularly making  a
market in such security selected for such purpose by the Board of Directors  of
the  Corporation  or  a committee thereof, in each case, on  each  trading  day
during  the  Adjustment Period.  "Adjustment Period" shall mean the  period  of
five  (5)  consecutive trading days preceding, and including, the  date  as  of
which the Fair Market Value of a security is to be determined.

                "Extraordinary  Distribution" shall mean any dividend or   other
distribution  to holders of Common Stock (effected while any of  the shares   of
Series  B  Preferred  Stock are outstanding) (i) of cash,  where  the  aggregate
amount  of  such cash dividend or distribution together with the amount  of  all
cash dividends and distributions made during the preceding period of 12  months,
when combined with the aggregate amount of all Pro Rata Repurchases  (for   this
purpose, including only that portion of the aggregate purchase price of such Pro
Rata Repurchase which is in excess of the Fair Market Value of the Common  Stock
repurchased as  determined  on the applicable expiration  date  (including   all
extensions thereof) of any tender offer or exchange offer which is a  Pro   Rata
Repurchase, or  the  date  of  purchase with respect  to  any  other  Pro   Rata
Repurchase which  is  not a tender offer or exchange  offer  made  during   such
period), exceeds 12 1/2% of the aggregate Fair Market Value of  all  shares   of
Common Stock outstanding on the day before the ex-dividend date with respect  to
such  Extraordinary Distribution which is paid in cash and on  the  distribution
date  with respect to an Extraordinary Distribution which is paid  other than in
cash, and/or (ii) of any shares of capital stock of the Corporation  (other than
shares  of  Common Stock), other securities of the Corporation (other   than the
securities  of the type referred to in paragraph (B) or (C) of this  Section 9),
evidences  of indebtedness of the Corporation or any other person or   any other
property  (including  shares  of  any subsidiary  of  the  Corporation)  or  any
combination thereof.  The Fair Market Value of an Extraordinary Distribution for
purposes of paragraph (D) of this Section 9 shall be equal to the  sum  of   the
Fair Market Value of such Extraordinary Distribution plus the amount of any cash
dividends  which are not Extraordinary Distributions made  during  such 12-month
period and not previously included in the calculation of an  adjustment pursuant
to paragraph (D) of this Section 9.

                "Fair Market Value" shall mean the amount of cash received  or,
as  to shares of Common Stock or any other class of capital stock or securities
of  the  Corporation or any other issuer which are publicly traded, the average
of  the Current Market Prices of such shares or securities for each day of  the
Adjustment  Period.   The  "Fair Market Value" of any  security  which  is  not
publicly  traded or of any other property shall mean the fair value thereof  as
determined by an independent commercial or investment banking or appraisal firm
experienced  in the valuation of such securities or property selected  in  good
faith by the Board of Directors of the Corporation or a committee thereof,  or,
if  no  such commercial or investment banking or appraisal firm is in the  good
faith  judgment of the Board of Directors or such committee available  to  make
such  determination, as determined in good faith by the Board of  Directors  of
the Corporation or such committee.

                "Non-Dilutive  Amount"  in respect  of  an  issuance,  sale  or
exchange  by  the  Corporation of any right or warrant to purchase  or  acquire
shares of Common Stock (including any security convertible into or exchangeable
for  shares of Common Stock) shall mean the remainder of (i) the product of the
Fair  Market  Value of a share of Common Stock on the day preceding  the  first
public  announcement  of  such issuance, sale or  exchange  multiplied  by  the
maximum  number of shares of Common Stock which could be acquired on such  date
upon  the  exercise  in full of such rights and warrants  (including  upon  the
conversion  or  exchange  of all such convertible or exchangeable  securities),
whether or not exercisable (or convertible or exchangeable) at such date, minus
(ii) the aggregate amount payable pursuant to such right or warrant to purchase
or  acquire  such maximum number of shares of Common Stock; provided,  however,
that  in no event shall the Non-Dilutive Amount be less than zero. For purposes
of  the  foregoing  sentence,  in the case of a security  convertible  into  or
exchangeable for shares of Common Stock, the amount payable pursuant to a right
or  warrant  to purchase or acquire shares of Common Stock shall  be  the  Fair
Market Value of such security on the date of the issuance, sale or exchange  of
such security by the Corporation.

                "Pro  Rata  Repurchase" shall mean any purchase  of  shares  of
Common  Stock by the Corporation or any subsidiary thereof, whether  for  cash,
shares   of  capital  stock  of  the  Corporation,  other  securities  of   the
Corporation,  evidences of indebtedness of the Corporation or any other  person
or any other property (including shares of a subsidiary of the Corporation), or
any combination thereof, effected while any of the shares of Series B Preferred
Stock  are outstanding, pursuant to any tender offer or exchange offer  subject
to  Section  13(e)  of  the Securities Exchange Act of 1934,  as  amended  (the
"Exchange  Act"), or any successor provision of law, or pursuant to  any  other
offer  available  to  substantially  all holders  of  Common  Stock;  provided,
however,  that  no  purchase of shares by the Corporation,  or  any  subsidiary
thereof made in open market transactions shall be deemed a Pro Rata Repurchase.
For  purposes  of  this paragraph 9(G), shares shall be  deemed  to  have  been
purchased  by  the  Corporation  or  any subsidiary  thereof  "in  open  market
transactions" if they have been purchased substantially in accordance with  the
requirements of Rule lOb-18 as such rule is in effect under the Exchange Act on
the  date  shares  of  Series B Preferred Stock are  initially  issued  by  the
Corporation, or on such other terms and conditions as the Board of Directors of
the  Corporation  or a committee thereof shall have determined  are  reasonably
designed to prevent such purchases from having a material effect on the trading
market for the Common Stock.

           (H)   Whenever an adjustment to the Conversion Price and the related
voting  rights  of  the Series B Preferred Stock is required,  the  Corporation
shall  forthwith place on file with the transfer agent(s) for the Common  Stock
and  for  the Series B Preferred Stock, if any, and with the Secretary  of  the
Corporation, a statement signed by two officers of the Corporation stating  the
adjusted  Conversion  Price determined as provided herein,  and  the  resulting
conversion  ratio,  and the voting rights (as appropriately adjusted),  of  the
Series  B Preferred Stock.  Such statement shall set forth in reasonable detail
such  facts  as  shall be necessary to show the reason for and  the  manner  of
computing  such  adjustment, including any determination of Fair  Market  Value
involved  in such computation. Promptly after each adjustment to the Conversion
Price  and  the  related  voting rights of the Series B  Preferred  Stock,  the
Corporation  shall mail a notice thereof and of the then prevailing  conversion
rate to each holder of shares of the Series B Preferred Stock.
     
     Section 10.    Ranking; Retirement of Shares.
           (A)  The Series B Preferred Stock shall rank senior to the Series  A
Junior Participating Preferred Stock and the Common Stock as to the payment  of
dividends  and  the  distribution  of assets on  liquidation,  dissolution  and
winding  up of the Corporation, and, unless otherwise provided in the  Restated
Certificate  of Incorporation of the Corporation, as the same may  be  amended,
the  Series B Preferred Stock shall rank pari passu with all future  series  of
the  Corporation's  Preferred  Stock as to the payment  of  dividends  and  the
distribution of assets on liquidation, dissolution or winding up.

           (B)   Any  shares  of  Series  B Preferred  Stock  acquired  by  the
Corporation  by  reason  of the conversion or redemption  of  such  shares,  or
otherwise  so  acquired,  shall be restored to the  status  of  authorized  but
unissued  shares  of  Preferred Stock, with no par  value  per  share,  of  the
Corporation, undesignated as to series, and may thereafter be reissued as  part
of a new or existing series of such Preferred Stock as permitted by law.

     Section 11.    Miscellaneous.
           (A)   All  notices referred to herein shall be in writing,  and  all
notices  hereunder  shall  be deemed to have been given  upon  the  earlier  of
receipt thereof or three (3) Business Days after the mailing thereof if sent by
registered  mail (unless first-class mail shall be specifically  permitted  for
such  notice elsewhere herein) with postage prepaid, addressed:  (i) if to  the
Corporation,  to  its  office at P.O. Box 049001, Chicago, Illinois  60604-9001
(Attention:   Secretary), or to the transfer agent for the Series  B  Preferred
Stock, or other agent of the Corporation designated as permitted herein or (ii)
if  to any holder of the Series B Preferred Stock or Common Stock, as the  case
may  be,  to such holder at the address of such holder as listed in  the  stock
record  books of the Corporation (which may include the records of any transfer
agent for the Series B Preferred Stock or Common Stock, as the case may be)  or
(iii) to such other address as the Corporation or any such holder, as the  case
may be, shall have designated by notice similarly given.

           (B)   The  Corporation shall give 15 Business Days'  notice  to  all
record holders of Series B ESOP Convertible Preferred Stock prior to the record
date  to be established with respect to any Extraordinary Event, setting  forth
the  material  provisions  relating  to  such  Extraordinary  Event,  provided,
however, that the failure to give any such notice shall not affect the validity
of any such corporate action.

                "Extraordinary  Event" as used herein means  (i)  any  non-cash
dividend  payable with respect to the Common Stock, (ii); any cash dividend  in
an  amount  exceeding 10% of the Conversion Price on the date the  dividend  is
declared,  (iii) any recapitalization, reclassification, consolidation,  merger
or similar event as a result of which shares of Common Stock are converted into
or  exchanged  for any other securities or property, (iv) any sale  of  all  or
substantially all of the assets of the Corporation, or (v) the adoption of  any
repurchase  program under which the Corporation may purchase more than  15%  of
the Corporation's then outstanding Common Stock.

           (C)   The  term "Common Stock" as used in this Resolution means  the
Corporation's  Common Stock, par value $5.00 per share (as the same  exists  at
the  date  of  amendment of the Restated Certificate of  Incorporation  of  the
Corporation in respect of the Series B Preferred Stock), or any other class  of
stock  resulting from successive changes or reclassifications  of  such  Common
Stock  consisting solely of changes in par value, or from par value to  no  par
value, or from no par value to par value.  In the event that, at any time as  a
result  of an adjustment made pursuant to Section 9 hereof, the holder  of  any
share  of the Series B Preferred Stock upon thereafter surrendering such shares
for conversion, shall become entitled to receive any shares or other securities
of  the Corporation other than shares of Common Stock, the Conversion Prize  in
respect  of  such other shares or securities so receivable upon  conversion  of
shares  of Series B Preferred Stock shall thereafter be adjusted, and shall  be
subject  to further adjustment from time to time, in a manner and on  terms  as
nearly equivalent as practicable to the provisions with respect to Common Stock
contained in Section 9 hereof, and the provisions of Sections 1 through  8,  10
and  11  hereof with respect to the Common Stock shall apply on like or similar
terms to any such other shares or securities.

          (D)    The  Corporation  shall pay any and  all  stock  transfer  and
documentary  stamp  taxes that may be payable in respect  of  any  issuance  or
delivery  of  shares of Series B Preferred Stock or shares of Common  Stock  or
other  securities issued on account of Series B Preferred Stock pursuant hereto
or  certificates representing such shares or securities.  The Corporation shall
not,  however, be required to pay any such tax which may be payable in  respect
of  any  transfer involved in the issuance or delivery of shares  of  Series  B
Preferred  Stock or Common Stock or other securities in a name other than  that
in  which  the  shares of Series B Preferred Stock with respect to  which  such
shares  or  other  securities are issued or delivered were  registered,  or  in
respect  of  any  payment to any person with respect  to  any  such  shares  or
securities other than a payment to the registered holder thereof, and shall not
be required to make any such issuance, delivery or payment unless and until the
person otherwise entitled to such issuance, delivery or payment has paid to the
Corporation  the amount of any such tax or has established, to the satisfaction
of the Corporation, that such tax has been paid or is not payable.

          (E)  In the event that a holder of shares of Series B Preferred Stock
shall  not by written notice designate the name in which shares of Common Stock
to  be  issued upon conversion of such shares should be registered or  to  whom
payment upon redemption of shares of Series B Preferred Stock should be made or
the  address to which the certificate or certificates representing such shares,
or  such payment, should be sent, the Corporation shall be entitled to register
such shares, and make such payment, in the name of the holder of such Series  B
Preferred  Stock  as shown on the records of the Corporation and  to  send  the
certificate or certificates representing such shares, or such payment,  to  the
address of such holder shown on the records of the Corporation.

          (F)    Unless  otherwise  provided in  the  Restated  Certificate  of
Incorporation, as the same may be amended, of the Corporation, all payments  in
the  form  of dividends, distributions on voluntary or involuntary dissolution,
liquidation  or  winding  up or otherwise made upon  the  shares  of  Series  B
Preferred  Stock  and any other stock ranking on a parity  with  the  Series  B
Preferred  Stock  with respect to such dividend or distribution  shall  be  pro
rata,  so that amounts paid per share on the Series B Preferred Stock and  such
other  stock  shall  in all cases bear to each other the same  ratio  that  the
required dividends, distributions or payments, as the case may be, then payable
per  share  on the shares of the Series B Preferred Stock and such other  stock
bear to each other.

          (G)  The Corporation may appoint, and from time to time discharge and
change,  a  transfer  agent for the Series B Preferred Stock.   Upon  any  such
appointment or discharge of a transfer agent, the Corporation shall send notice
thereof  by  first-class mail, postage prepaid, to each  holder  of  record  of
Series B Preferred Stock.