<PAGE>
                                                           EXHIBIT 10.(iv)(D)(3)





                      MONTGOMERY WARD & CO., INCORPORATED

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

                             Dated: March 30, 1997


     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 April 1, 1997, in the 
following manner:

     1. Addendum B 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: Robert A. Kasenter /s/ Robert A. Kasenter
                                      ------------------------------------------

                                   Its: EVP Human Resources
                                       -----------------------------------------


ATTEST:


By:  Philip Delk /s/ Philip Delk
   -------------------------------

Its: VP & Deputy General Counsel
    ------------------------------
<PAGE>
 
                                   Addendum B
                      Montgomery Ward & Co., Incorporated
                           Retirement Security Plan

     B-1  Purpose.  The purpose of this Addendum B is to provide for 
participation in the Plan by eligible employees of Montgomery Ward & Co., 
Incorporated-Japan Branch.

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

     B-3  Conflicts Between Plan and This Addendum B.  This Addendum B, together
with the Plan, comprises the Plan with respect to Participants under this
Addendum B. In case of any conflict between the provisions of the Plan and this
Addendum B, the terms and the provisions of this Addendum B shall govern to the
extent necessary to eliminate such conflict.

     B-4  Participants.  Nonresident aliens employed by Montgomery Ward & Co., 
Incorporated-Japan Branch shall be considered "Employees", "Associates", and 
"Japan Associates" for purposes of the Plan and this Addendum B. Japan 
Associates employed by Montgomery Ward & Co., Incorporated-Japan Branch on April
1, 1997 who have completed one Year of Service by April 1, 1997 participate in 
the Plan as of April 1, 1997. Each other Associate who both attains age 21 and
complete one Year of Service shall become a Participant under the Plan on the
first day of the month following the month in which such Associate meets the
eligibility requirements.

     B-5  Vesting.  If a Japan Associate completes two Years of Service, such 
Associate shall be Vested (have a nonforfeitable right to a Retirement Benefit) 
in such Associate's Retirement Benefit.

     B-6  Final Monthly Salary.  For purposes of this Addendum B, "Final Monthly
Salary" means annual base salary or pay preceding the date of termination of 
Service by a Japan Associate, divided by fifteen (15).

     B-7  Retirement Benefit.  If a Participant who is a Japan 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 the 
currency of Japan 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, 10.1, 10.2 and 10.3 of the Plan


<PAGE>
 
do not apply to Participants who are Japan Associates. Except as otherwise 
provided in Article IX and Section 11.4 of the Plan, a Participant who is a 
Japan Associate who Retires on the Participant's Normal Retirement Date shall be
eligible for the Retirement Benefit defined in this paragraph B-7 or an 
Actuarial Equivalent benefit thereto as provided for herein.

     B-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 Japan 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 the currency of Japan, or in installments 
over five quarterly payments in the currency of Japan. 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 Japan 
Associates.

     B-9  Termination of Service by a Vested Participant.  If the Service of a 
Participant who is a Japan 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 Japan Associates.

     B-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 Japan 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.

     B-11  Actuarial Equivalent.  For purposes of this Addendum B, "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.

                                       2