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                                                                    EXHIBIT 10.3

                    NAVISTAR 1994 PERFORMANCE INCENTIVE PLAN
                         Amended as of December 16, 1997


                                    SECTION I

                            ESTABLISHMENT OF THE PLAN

      The Board of Directors of Navistar International  Corporation approved the
establishment of the Navistar 1994 Performance Incentive Plan ("Plan"). The Plan
replaces the Navistar 1988  Performance  Incentive Plan which  consolidated  and
modified the  Corporation's  Annual Incentive Plan, the Long Term Incentive Plan
and the 1984 Stock Option Plan into one plan.


                                   SECTION II

                               PURPOSE OF THE PLAN

      The purpose of the Plan is to enable the Corporation and its  subsidiaries
to attract and retain highly qualified  personnel,  to provide key employees who
hold positions of major  responsibility the opportunity to earn incentive awards
commensurate  with the quality of individual  performance,  the  achievement  of
performance goals and ultimately the increase in shareowner value.

                                   SECTION III

                                   DEFINITIONS

      For the purposes of the Plan,  the following  words and phrases shall have
the meanings  described below in this Section III unless a different  meaning is
plainly required by the context.

      (1)       "Annual  Incentive Award" means an award of cash approved by the
                Committee  based on the level of  achievement  attained  against
                annual  performance  goals approved by the Committee on or prior
                to the commencement of the applicable Fiscal year.

      (2)       "Award" means an award made under the Plan.

      (3)       "Board  of  Directors"  means  the  Board  of  Directors  of
                Navistar International Corporation.




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      (4)       "Change in Control"  shall be deemed to have occurred if (A) any
                "Person"  or  "group"  (as such terms are used in Section 13 (d)
                and 14 (d) of the  Securities  Exchange  Act of 1934) other than
                employee  or  retiree  benefit  plans  or  trusts  sponsored  or
                established  by  the   Corporation  or  Navistar   International
                Transportation  Corp.  ("NITC")  is or becomes  the  "beneficial
                owner" (as defined in Rule 13d-3 under the  Securities  Exchange
                Act of 1934),  directly  or  indirectly,  of  securities  of the
                Corporation  representing  25% or  more of the  combined  voting
                power of the Corporation's then outstanding  securities,  (B) as
                the result of, or in  connection  with,  any cash tender  offer,
                exchange offer,  merger or other business  combination,  sale of
                assets,  proxy or consent  solicitation,  contested  election or
                substantial stock  accumulation (a "Control  Transaction"),  the
                members of the Board of Directors of the Corporation immediately
                prior to the first public announcement  relating to such Control
                Transaction shall immediately  thereafter,  or within two years,
                cease to  constitute a majority of the Board of Directors of the
                Corporation  or  (C)  any  dissolution  or  liquidation  of  the
                Corporation  or NITC or an agreement for the sale or disposition
                of all or substantially all (more than 50%) of the assets of the
                Corporation or NITC occurs.  Notwithstanding the foregoing,  the
                sale or  disposition  of any or all of the  assets  or  stock of
                Navistar  Financial  Corporation shall not be deemed a Change in
                Control.

      (5)      "Committee"  means  the  Committee  on  Organization  of the
                Board of Directors.

      (6)      "Common Stock" means the common stock of the Corporation.

      (7)      "Corporation" means Navistar International Corporation.

      (8)       "Employee" means a person regularly  employed by the Corporation
                or any subsidiary of the Corporation, including its officers.

      (9)       "Fair  Market  Value"  means the average of the high and the low
                prices of a share of Common Stock on the effective date of grant
                as  set  forth  in  the  New  York  Stock   Exchange   Composite
                Transactions  listing  published  in the Midwest  Edition of The
                Wall Street Journal or equivalent financial publication.

      (10)      "Fiscal Year" means the fiscal year of the Corporation.

      (11)      "Incentive  Stock  Option"  means a right,  as  evidenced  by an
                agreement  between  the  Participant  and the  Company in a form
                approved  by the  Committee,  to  purchase  a certain  number of
                shares of Common  Stock at Fair Market Value for a period of ten
                (10) years from the date of grant which  options are designed to
                meet the  requirements set out under Section 422 of the Internal
                Revenue Code.




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      (12)      "Long-term  Incentive Award" means an award of Restricted Shares
                for a long-term cycle, the amount of the award and the length of
                the cycle will be determined by the Committee.

      (13)      "Nonqualified  Stock Option"  means a right,  as evidenced by an
                agreement  between  the  Participant  and the  Company in a form
                approved  by the  Committee,  to  purchase  a certain  number of
                shares of Common  Stock at Fair Market Value for a period of ten
                (10)  years and one day from the date of grant on which  options
                are stated not to be qualified as incentive  stock options under
                Section 422 of the U.S. Internal Revenue Code.

      (14)      "Participant"  means an  Employee  selected by the  Corporation
                for participation in the Plan.

      (15)      "Plan" means the Navistar 1994 Performance Incentive Plan as set
                forth  herein  and as it may be amended  hereafter  from time to
                time.

      (16)      "Qualified Retirement" means a retirement from employment of the
                Corporation  or any of its  subsidiaries  at any time  after the
                attainment of age  fifty-five  (55) with at least ten (10) years
                of  credited  service as defined  by the  applicable  retirement
                plan.

      (17)      "Restricted  Share" means a share of Common  Stock  awarded to a
                Participant by the Committee  without payment by the Participant
                which  is  restricted  as to sale or  transfer  and  subject  to
                forfeiture pursuant to terms established by the Committee at the
                time of issuance.

      (18)     "Stock  Option" means either an Incentive Stock Option or a
               Nonqualified Stock Option.

                                   SECTION IV

                                   ELIGIBILITY

      Management will, from time to time,  select and recommend to the Committee
Employees who are to become  Participants  in the Plan.  Such  Employees will be
selected  from  those  who,  in the  opinion  of  management,  have  substantial
responsibility in a managerial or professional capacity.  Employees selected for
participation in the Plan may not  concurrently  participate in any other annual
performance,  long term  performance,  sales incentive or profit sharing plan of
the Corporation or any of its  subsidiaries  except as specifically  approved by
the Committee.




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                                    SECTION V

                             ANNUAL INCENTIVE AWARDS

      (1)       On or before the commencement of each Fiscal Year, the Committee
                will approve  performance  goals for corporate  achievement  for
                such Fiscal Year, and the amount of the Annual  Incentive Awards
                for such Fiscal  Year will be based on the level of  achievement
                attained  against  previously  approved  performance  goals. The
                Committee  also  will  approve  an  award  percentage  for  each
                organization level for each performance goal.

      (2)       Performance  goals  for  Annual  Incentive  Awards  will  not be
                increased  or   decreased   within  a  Fiscal  Year  except  for
                extraordinary circumstances approved by the Committee.

      (3)       An  Annual  Incentive  Award  determination  will be made by the
                Committee when the financial results and performance  levels for
                a Fiscal Year are presented to the Committee by management.

      (4)       Payment of an Annual Incentive Award will be made in cash to the
                Participant  as soon as  practicable  after an Annual  Incentive
                Award   determination   has  been  made  by  the  Committee.   A
                Participant  who is not an  Employee at the end of a Fiscal Year
                will not be  entitled  to an  Annual  Incentive  Award  for that
                Fiscal Year unless the Committee determines otherwise.


                                   SECTION VI

                           LONG TERM INCENTIVE AWARDS

      (1)       On or before the commencement of each Fiscal Year, the Committee
                will approve  performance goals for corporate  achievement for a
                long-term  cycle as determined by the  Committee.  The amount of
                any  Long  Term  Incentive  Award  earned  shall be based on the
                cumulative  level of performance  attained  against the approved
                performance goals.

      (2)       Criteria for Long Term Incentive Awards will not be increased or
                decreased  for any  long-term  cycle which has begun  except for
                extraordinary circumstances approved by the Committee.

      (3)       Separate Long-term  Incentive Award  determinations will be made
                by the Committee for each long term cycle.




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      (4)       Restricted  Shares  will be  awarded  by the  Committee  to each
                Participant  approved by the  Committee at the beginning of each
                cycle  unless  to do so  would  present  a  substantial  risk of
                causing the Corporation to undergo an ownership  change, as such
                term is defined in Section 382 of the Internal  Revenue Code, in
                which event the  Committee  shall delay the award until there is
                no longer such a risk. The amount to be awarded will be pursuant
                to a formula  approved by the  Committee  which will be based on
                the ability of the  Participant  to contribute to the efforts to
                achieve the performance  goals approved by the Committee for the
                applicable  cycle.  The Committee  shall  designate which shares
                shall be subject to performance  goals.  The Committee will make
                the final Long-Term Award  determination.  No fractional  shares
                will be  issued.  A  Participant  who quits or is  involuntarily
                separated  will forfeit any  Restricted  Shares.  Any Restricted
                Shares  forfeited  shall be forfeited (i) to the Company or (ii)
                if the forfeiture to the Company  creates a substantial  risk of
                an ownership  change under  Section 382 of the Internal  Revenue
                Code,  then to the  salaried  and hourly  pension  trusts of the
                Corporation's  principal operating  subsidiary pro rata based on
                assets held in the trusts as of the  beginning of the prior plan
                year. If a Participant  dies,  becomes  permanently  and totally
                disabled,   or  retires  pursuant  to  a  Qualified  Retirement,
                Restricted  Shares  previously  awarded  which  are  subject  to
                performance  goals, will be retained until the shares are earned
                or forfeited for failure to meet the performance goals.

      (5)       A Participant  may elect,  subject to the  provisions of Section
                VII(2),  to pay any  withholding  tax due on Stock Options or on
                Restricted  Shares  awarded  pursuant  to the Plan either (i) by
                cash including a personal check made payable to the  Corporation
                or (ii) by delivering at Fair Market Value  unrestricted  Common
                Stock  already  owned  by  the   Participant  or  (iii)  by  any
                combination  of  cash  or  unrestricted  Common  Stock.  If  the
                Participant is an officer of the  Corporation  who is subject to
                Section 16(b) of the Securities  Exchange Act of 1934, he or she
                may make an election  pursuant to (ii) or (iii) above only if it
                is made in  writing  (a) at least six (6) months  following  the
                date of grant of an  option  or an  award  and at least  six (6)
                months  prior to the date on which  the  amount  of the  minimum
                required  withholding  tax  related  to the  option  or award is
                determined or (b) within a ten-day period  following the release
                of the Corporation's annual or quarterly financial results. Once
                an officer,  who is subject to Section  16(b) of the  Securities
                Exchange  Act of 1934,  makes an  election  pursuant  to (ii) or
                (iii) above with respect to a specific option or award, it shall
                be  irrevocable  unless  the  election  is  disapproved  by  the
                Committee at its next meeting  following  the  election.  If the
                redemption of shares by the Corporation to pay withholding taxes
                would present a substantial  risk of causing an ownership change
                under Section 382 of the Internal  Revenue Code, the Corporation
                may refuse the  redemption.  In such a case of refusal to redeem
                by the Corporation,  the Participant  would be permitted to sell
                sufficient shares to pay any withholding taxes due.



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                                   SECTION VII

                                  STOCK OPTIONS

      (1)       The Committee may grant  Nonqualified Stock Options or Incentive
                Stock Options or a combination  of both to  Participants  in the
                amount  and at the time  that  the  Committee  approves.  Option
                grants  shall be limited to a maximum of 50,000  shares per year
                for any Participant.

      (2)       Unless  otherwise  determined by the  Committee,  a Stock Option
                granted  under the Plan will become  exercisable  in whole or in
                part after the  commencement  of the second  year of the term of
                the Stock  Option to the extent of one third of the  shares,  to
                the extent of one third of the shares after  commencement of the
                third year,  and to the extent of one third of the shares  after
                commencement   of  the  fourth  year.   The  Committee  will  be
                authorized  to  establish  the  manner  of  exercise  of a Stock
                Option.  The effective date of the grant of a Stock Option will,
                unless the  Committee  expressly  determines  otherwise,  be the
                business day on which the  Committee  approves the grant of such
                Stock Option,  provided that such grant will expire if a written
                option  agreement is not signed by the  Participant  receiving a
                Stock Option and delivered to the Corporation within thirty (30)
                days  of such  approval  by the  Committee.  The  option  can be
                exercised  in whole or in part  through  cashless  exercises  or
                other  arrangements  through  agents,  including  stock brokers,
                under arrangements  established by the Corporation by paying the
                amounts required by instructions  issued by the Secretary of the
                Corporaton  for the exercise of the  options.  If an exercise is
                not covered by instructions  issued by the Corporate  Secretary,
                the purchase price is to be paid in full to the Corporation upon
                the  exercise of a Stock Option  either (i) by cash  including a
                personal  check  made  payable  to  the  Corporation;   (ii)  by
                delivering  at  Fair  Market  Value  unrestricted  Common  Stock
                already owned by the Participant for six months or more or (iii)
                by any combination of cash and unrestricted Common Stock, and in
                either case, by payment to the  Corporation  of any  withholding
                tax. In no event may successive  simultaneous pyramiding be used
                to exercise an Option.  If  permitting  the  exercise of a Stock
                Option at the time notice of intent is given by the  Participant
                to the Corporation  would present a substantial  risk of causing
                an ownership  change under  Section 382 of the Internal  Revenue
                Code, the Corporation may refuse to permit the exercise in which
                event as soon as the  Corporation  determines that a substantial
                risk of causing an ownership  change no longer  exists,  it will
                issue  shares of Common  Stock equal in value to the  difference
                between the  exercise  price per share and the market  price per
                share times the number of shares  covered by the  exercise  plus
                interest on the total for the period of the delay  calculated at
                the composite  prime rate of interest to corporate  borrowers as
                published in The Wall Street Journal. The Committee also will be
                authorized  in  its   discretion  to  prescribe  in  the  option
                agreement  for the  exercise  of the Stock  Option  in  specific
                installments.  A Stock  Option  granted  under  the Plan will be
                exercisable  during such period as the Committee may  determine,
                and will be subject to earlier




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                termination as hereinafter provided. In no event, however, may a
                Stock  Option  governed  by the  Plan  be  exercised  after  the
                expiration  of its term.  Except as  provided  herein,  no Stock
                Option may be exercised at any time unless the  Participant  who
                holds the Stock Option is then an Employee.  The Participant who
                holds  a  Stock  Option  will  have  none  of  the  rights  of a
                shareowner  with respect to the shares subject to a Stock Option
                until  such  shares  are  issued  upon the  exercise  of a Stock
                Option.  Shares which otherwise would be delivered to the holder
                of a Stock  Option  may be  delivered,  at the  election  of the
                holder,  to the Corporation in payment of Federal,  state and/or
                local withholding taxes due in connection with an exercise.

      (3)       Neither  the  Corporation  nor any  subsidiary  may  directly or
                indirectly  lend  money to any  Participant  for the  purpose of
                assisting  the  individual  to  acquire  shares of Common  Stock
                issued upon the  exercise  of Stock  Options  granted  under the
                Plan.

      (4)       In the  event of the  termination  of the  employment  of a
                Participant who holds an outstanding Stock Option, other than by
                reason of death,  total and permanent  disability or a Qualified
                Retirement,  the  Participant may (unless the Stock Option shall
                have been  previously  terminated)  exercise the Stock Option at
                any time within three (3) months after such termination, but not
                after the expiration of the term of the grant,  to the extent of
                the number of shares which were  exercisable  at the date of the
                termination  of employment.  Stock Options  governed by the Plan
                will not be affected by any change of  employment so long as the
                Participant continues to be an Employee.

      (5)       Except as provided  in the last two  sentences  of this  Section
                VII(5),  in the  event of  Qualified  Retirement  or  total  and
                permanent  disability,  a Participant  who holds an  outstanding
                Stock Option may exercise  the Stock  Option,  to the extent the
                option is exercisable or becomes exercisable under its terms, at
                any time within three years after such termination or, if later,
                the date on which the option becomes exercisable with respect to
                such  shares,  but not after the  expiration  of the term of the
                grant.  In the event of the death of a Participant  who holds an
                outstanding Stock Option, the Stock Option may be exercised by a
                legatee, or by the personal representatives or distributees,  at
                any time within a period of two (2) years after  death,  but not
                after the  expiration of the term of the grant.  If death occurs
                while employed by the Corporation or a subsidiary, or during the
                three-year  period  specified  in the  first  sentence  of  this
                paragraph,  options  may  be  exercised  to  the  extent  of the
                remaining  shares  covered by Stock Options  whether or not such
                shares were  exercisable  at the date of death.  If death occurs
                during the three-month  period specified in Section VII(4) Stock
                Options may be  exercised  to the extent of the number of shares
                which were exercisable at the date of death. Notwithstanding the
                other provisions of this Section VII(5),  no option which is not
                exercisable at the time of a retirement shall become exercisable
                after such  retirement  if,  without the written  consent of the
                Corporation,  a  Participant  engages in a business,  whether as
                owner, partner,




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                officer,  employee,  or otherwise,  which is in competition with
                the   Corporation  or  one  of  its   affiliates,   and  if  the
                Participant's  participation  in such  business is deemed by the
                Corporation  to be  detrimental  to the  best  interests  of the
                Corporation. The determination as to whether such business is in
                competition  with the Corporation or any of its affiliates,  and
                whether such  participation by such person is detrimental to the
                best  interests  of  the  Corporation,  shall  be  made  by  the
                Corporation in its absolute discretion,  and the decision of the
                Corporation with respect thereto, including its determination as
                to  when  the   participation  in  such   competitive   business
                commenced, shall be conclusive.


                                  SECTION VIII

                                RESTRICTED SHARES

      (1)       In addition to the  Restricted  Shares which the  Committee  may
                award  pursuant to Section  VI(4),  the Committee also may award
                Restricted  Shares to individuals  recommended by management for
                either  retention  or  performance  purposes  or as  part  of an
                employment agreement.

      (2)       The  Participant  will be  entitled to all  dividends  paid with
                respect to all  Restricted  Shares awarded under the Plan during
                the period of restriction and will not be required to return any
                such dividends to the Corporation in the event of the forfeiture
                of the Restricted  Shares. The Participant also will be entitled
                to vote Restricted Shares during the period of restriction.

      (3)       All Restricted Share certificates  awarded under the Plan are to
                be  delivered  to the  Participant  with an  appropriate  legend
                imprinted on the certificate.


                                   SECTION IX

                   ADJUSTMENTS UPON CHANGES IN CAPITALIZATION

      Notwithstanding any other provision of the Plan, the option agreements may
contain such  provisions as the Committee  determines to be appropriate  for the
adjustment of the number and class of shares,  subject to each outstanding Stock
Option,  the option  prices in the event of changes  in, or  distributions  with
respect  to,  the  outstanding  Common  Stock  by  reason  of  stock  dividends,
recapitalizations, mergers, consolidations, split-ups, combinations or exchanges
of shares,  spinoffs and the like,  and, in the event of any such changes in, or
distribution with respect to, the outstanding Common Stock, the aggregate number
and class of shares available under the Plan shall be appropriately  adjusted by
the Committee, whose determination shall be conclusive.




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                                    SECTION X

                           ADMINISTRATION OF THE PLAN

      Full power and authority to construe, interpret and administer the Plan is
vested in the Committee.  Decisions of the Committee  will be final,  conclusive
and  binding  upon all  parties,  including  the  Corporation,  shareowners  and
employees.  The  foregoing  will  include,  but  will  not be  limited  to,  all
determinations  by the  Committee  as to  (a)  the  approval  of  Employees  for
participation  in the Plan,  (b) the amount of the Awards,  (c) the  performance
levels at which  different  percentages  of the  Awards  would be earned and all
subsequent  adjustments to such levels and (d) the  determination of all Awards.
Any person who accepts any Award hereunder agrees to accept as final, conclusive
and binding all  determinations  of the  Committee.  The Committee will have the
right, in the case of employees not employed in the United States,  to vary from
the provision of the Plan to the extent the Committee deems appropriate in order
to preserve the incentive features of the Plan.


                                   SECTION XI

                                 NON-ASSIGNMENT

      Awards  under  the Plan may not be  assigned  or  alienated.  In case of a
Participant's death, the amounts distributable to the deceased Participant under
the Plan with respect to which a designation  of  beneficiary  has been made (to
the  extent  it  is  valid  and  enforceable  under  applicable  law)  shall  be
distributed  in  accordance  with  the  Plan to the  designated  beneficiary  or
beneficiaries.  The amount  distributable  to a  Participant  upon death and not
subject to such a designation shall be distributed to the Participant's  estate.
If  there is any  question  as to the  right of any  beneficiary  to  receive  a
distribution under the Plan, the amount in question may be paid to the estate of
the Participant,  in which event the Corporation will have no further  liability
to anyone with respect to such amount.


                                   SECTION XII

                              RIGHTS OF PARTICIPANT

      To the extent that any Participant, beneficiary or estate acquires a right
to  receive  payments  or  distributions  under the Plan,  such right will be no
greater than the right of a general unsecured  creditor of the Corporation.  All
payments and  distributions  to be made  hereunder will be paid from the general
assets of the  Corporation.  Nothing  contained in the Plan, and no action taken
pursuant  to  its  provisions,  shall  create  or be  construed  to  create  any
contracted  right or trust of any kind or  fiduciary  relationship  between  the
Corporation and any Participant, beneficiary or estate.




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                                  SECTION XIII

                     MODIFICATION, AMENDMENT OR TERMINATION

      The Committee may modify  without the consent of the  Participant  (i) the
Plan,  (ii) the terms of any  option  previously  granted  or (iii) the terms of
Restricted  Shares  previously  awarded  at any  time,  provided  that,  no such
modification  will,  without the approval of the shareowners of the Corporation,
increase the number of shares of Common Stock available hereunder. The Committee
may terminate the Plan at any time.


                                   SECTION XIV

                              RESERVATION OF SHARES

      Each fiscal year,  there will be reserved for issue under the Plan one (1)
percent of the outstanding shares of Common Stock including Class B Common Stock
of the  Corporation as determined by the number of shares  outstanding as of the
end of the immediately preceding fiscal year. No more than Five Hundred Thousand
(500,000)  shares  shall be granted as Incentive  Stock  Options in any calendar
year.  Such shares may be in whole or in part,  as the Board of Directors  shall
from time to time  determine,  authorized and unissued shares of Common Stock or
issued  shares  of  Common  Stock  which  shall  have  been  reacquired  by  the
Corporation. If less than one (1) percent of the shares is granted or awarded in
any fiscal year, the difference  will be available for use in the following year
only and if not used in the  following  year,  those  shares  will no  longer be
available.  Any shares  available from the prior year will be the last shares to
be granted or awarded.


                                   SECTION XV

                               AGREEMENT TO SERVE

      Each  Participant  receiving a  Nonqualified  Stock Option or an Incentive
Stock Option shall, as one of the terms of the option agreement, agree to remain
in the service of the Corporation or of one of its  subsidiaries for a period of
at least one (1) year from the date of granting  the option.  Such  service will
(subject to the provisions of any contract  between the  Corporation or any such
subsidiary  and such  Participant)  be at the pleasure of the  Corporation or of
such  subsidiary and at such  compensation as the Corporation or such subsidiary
shall determine from time to time. Any  termination of a  Participant's  service
for any reason other than death,  permanent  and total  disability  or Qualified
Retirement  during such  period  shall be deemed a  violation  of the  Agreement
contained in this  Section.  In the event of such  violation,  any  Nonqualified
Stock Option or Incentive  Stock Option held by the  Participant  under the Plan
will immediately be canceled. Nothing in the Plan will confer on any Participant
any  right  to  continue  in  the  employ  of  the  Corporation  or  any  of its
subsidiaries  or  interfere  with  or  prevent  in  any  way  the  right  of the
Corporation or any of its  subsidiaries to terminate a Participant's  employment
at any time for any reason.




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                                   SECTION XVI

                                CHANGE IN CONTROL

      Notwithstanding  any provision  contained  herein to the contrary,  in the
event of a Change in Control,  all awarded Restricted Shares will immediately be
free of all restrictions and performance  contingencies and will be deemed fully
earned and not subject to forfeiture and all outstanding options governed by the
Plan will be immediately  exercisable and shall continue to be exercisable for a
period of three (3) years from the date of the Change in Control  regardless  of
the original  term or employment  status,  except that the term of any Incentive
Stock Option shall not be extended beyond ten (10) years from the date of grant.


                                  SECTION XVII

                              LIMITATION OF ACTIONS

      Every right of action by or on behalf of the Corporation or any shareowner
against any past, present or future member of the Board of Directors, officer or
Employee arising out of or in connection with the Plan will, irrespective of the
place where action may be brought and  irrespective of the place of residence of
any such director, officer or employee, cease and be barred by the expiration of
three years from  whichever  is the later of (a) the date of the act or omission
in respect of which such right of action arises or (b) the first date upon which
there has been made  generally  available to shareowners an annual report of the
Corporation  and a  proxy  statement  for  the  annual  meeting  of  shareowners
following  the issuance of such annual  report,  which  annual  report and proxy
statement  alone or together set forth,  for the related  period,  the aggregate
amount of Awards  under the Plan  during such  period;  and any and all right of
action by an Employee (past,  present or future) against the Corporation arising
out of or in  connection  with the Plan shall,  irrespective  of the place where
action may be brought,  cease and be barred by the expiration of three (3) years
from the date of the act or  omission  in  respect of which such right of action
arises.


                                  SECTION XVIII

                                  GOVERNING LAW

      The Plan will be governed by and  interpreted  pursuant to the laws of the
State of Delaware, the place of incorporation of the Corporation.




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<PAGE>


                                   SECTION XIX

                               SUBSIDIARIES' PLANS

      To the extent  determined by the Committee,  any subsidiary  may,  without
regard to the  limitations  under the Plan,  have a separate  incentive  plan or
program.  The Committee will have exclusive  jurisdiction and sole discretion to
approve or disapprove any such plan or program and, from time to time, to amend,
modify,  or suspend any such plan or program.  Individuals  eligible  for Awards
under any such plan or program  will not be  considered  Employees  eligible for
Awards  under  the  Plan,  unless  otherwise  determined  by the  Committee.  No
provision of any such plan or program will be included in, or  considered a part
of,  the Plan and any awards  made  under any such plan or  program  will not be
charged against the aggregate  amount  available under the Plan unless otherwise
determined by the Committee.

                                   SECTION XX

                                 EFFECTIVE DATE

      The effective  date of the Plan shall be December 16, 1993, if approved by
the  shareowners  at the 1994  Annual  Meeting,  and the Plan shall  continue in
effect for ten (10) years from the effective date.




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