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                         MONTGOMERY WARD & CO., INCORPORATED

                                   First Amendment
                                        to the
                         Montgomery Ward & Co., Incorporated
                               Retirement Security Plan

                               Dated:  October 9, 1995



    WHEREAS, Montgomery Ward & Co., Incorporated, an Illinois corporation
("Ward"), maintains the Montgomery Ward & Co., Incorporated Retirement Security
Plan ("Plan"); and

    WHEREAS, pursuant to Section 17.1 POWER TO AMEND, the power to amend the
Plan is reserved to the Board of Directors of Montgomery Ward & Co.,
Incorporated ("Board"); and

    WHEREAS, the Board desires to amend the Plan.

    NOW, THEREFORE, the Plan is amended effective October 1, 1995, in the
following manner:

    1.   Addendum A is added to the Plan to read in its entirety as attached
hereto.

    2.   In all other respects, the Plan shall continue in full force and
effect.


                                       MONTGOMERY WARD & CO., INCORPORATED


                                       By:  /s/ Robert A. Kasenter
                                          -------------------------------------
                                       Its: EVP Human Resources
                                           ------------------------------------
ATTEST:

By:  /s/ Philip Delk
   --------------------------------
Its: VP & Deputy General Counsel
    -------------------------------

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                                      ADDENDUM A
                         MONTGOMERY WARD & CO., INCORPORATED
                               RETIREMENT SECURITY PLAN


    A-1  PURPOSE.  The purpose of this Addendum A is to provide for
participation in the Plan by eligible employees of Montgomery Ward (Hong Kong)
Limited.

    A-2  USE OF TERMS.  Except where the context of this Addendum A expressly
indicates to the contrary, terms used and defined in the Plan shall have the
same meanings for purposes of this Addendum A.  As used in this Addendum A, the
term this "Addendum A" shall include only this Addendum A, and the references to
the "Plan" shall include all provisions of the Plan but shall not include this
Addendum A.

    A-3  CONFLICTS BETWEEN PLAN AND THIS ADDENDUM A.  This Addendum A, together
with the Plan, comprises the Plan with respect to Participants under this
Addendum A.  In case of any conflict between the provisions of the Plan and this
Addendum A, the terms and the provisions of this Addendum A shall govern to the
extent necessary to eliminate such conflict.

    A-4  PARTICIPANTS.  Nonresident aliens employed by Montgomery Ward (Hong
Kong) Limited shall be considered "Employees", "Associates", and "Hong Kong
Associates" for purposes of the Plan and this Addendum A.  Hong Kong Associates
employed by Montgomery Ward (Hong Kong) Limited on October 1, 1995 who have
completed one Year of Service by October 1, 1995 participate in the Plan as of
October 1, 1995.  Each other Hong Kong Associate who both attains age 21 and
completes one Year of Service shall become a Participant under the Plan on the
first day of the month following the month in which the Hong Kong Associate
meets the eligibility requirements.

    A-5  VESTING.  If a Hong Kong Associate completes five Years of Service,
such Hong Kong Associate shall be Vested (have a nonforfeitable right to a
Retirement Benefit) in the Hong Kong Associate's Retirement Benefit.  Each Hong
Kong Associate employed by Montgomery Ward (Hong Kong) Limited on October 31,
1995 who has completed two years of service with Montgomery Ward (Hong Kong)
Limited but has not yet completed five Years of Service shall be Vested (have a
nonforfeitable right to a Retirement Benefit) in the Retirement Benefit to which
the Associate would have been entitled if the Associate terminated employment
with Montgomery Ward (Hong Kong) Limited on October 31, 1995.

    A-6  FINAL MONTHLY SALARY.  For purposes of this Addendum A, "Final Monthly
Salary" means annual base salary or pay preceding the date of termination of
Service by a Hong Kong Associate, calculated in Hong Kong Dollars, divided by
fourteen (14).

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    A-7  RETIREMENT BENEFIT.  If a Participant who is a Hong Kong Associate
Retires on the Participant's Normal Retirement Date, the amount of the
Retirement Benefit shall be the Actuarial Equivalent of a lump sum expressed in
Hong Kong Dollars determined by multiplying the participant's Final Monthly
Salary by the Participant's years of Service (calculated to the nearest month).
Sections 9.1, 9.2, 9.3, 10.1, 10.2 and 10.3 of the Plan do not apply to
Participants who are Hong Kong Associates.  Except as otherwise provided in
Article IX and Section 11.4 of the Plan, a Participant who is a Hong Kong
Associate who Retires on the Participant's Normal Retirement Date shall be
eligible for the Retirement Benefit defined in this paragraph A-7 or an
Actuarial Equivalent benefit thereto as provided for herein.

    A-8  OPTIONAL METHODS OF PAYMENT.  In lieu of the Qualified Joint and
Survivor Benefit payable to a married Participant or the single life annuity
payable to an unmarried Participant, a Participant who is a Hong Kong Associate
may elect, subject to Sections 11.3 and 11.4 of the Plan, to receive the
Actuarial Equivalent of the Retirement Benefit to which the Participant is
entitled under the Plan in one lump sum payment in Hong Kong Dollars or in
installments over five quarterly payments in Hong Kong Dollars.  Any such
election shall comply with the spousal consent requirements of Section 11.5 of
the Plan.  Section 11.2 of the Plan does not apply to Participants who are Hong
Kong Associates.

    A-9  TERMINATION OF SERVICE BY A VESTED PARTICIPANT.
If the Service of a Participant who is a Hong Kong Associate and who is Vested
terminates prior to Retirement, such Participant may elect, subject to the
spousal consent requirements of Section 11.5 of the Plan, a Retirement Benefit
commencing on the first day of any month within nine months after the
Participant's termination of Service and prior to the Participant's Normal
Retirement Date or on the Participant's Normal Retirement Date.  Section 13.2 of
the Plan does not apply to Participants who are Hong Kong Associates.

    A-10 DEATH BENEFITS. In lieu of the Pre-Retirement Death Benefit described
in Section 12.1, the spouse of a Participant who died while employed as a Hong
Kong Associate or within the first nine months after the Participant's
termination of Service may elect to receive (i) a lump sum amount equal to the
lump sum amount which would have been payable to the Participant if the
Participant had terminated Service on the earlier of the date of the
Participant's death or the Participant's prior termination of Service or (ii)
five quarterly installments equal to the quarterly installment amount which
would have been payable to the Participant if the Participant had terminated
Service on the earlier of the date of the Participant's death or the
Participant's prior termination of Service.


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    A-11 ACTUARIAL EQUIVALENT.  For purposes of this Addendum, "Actuarial
Equivalent" shall mean the lesser of (i) Actuarial Equivalent as otherwise
defined in the Plan and (ii) Actuarial Equivalent computed as otherwise defined
in the Plan but using a 5% interest rate.


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