Document:

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            1994 NORTHWEST AIRLINES CORPORATION STOCK INCENTIVE PLAN
                                                AS AMENDED JUNE 2000

ARTICLE 1. PURPOSE AND DURATION

         1.1 PURPOSE. The purpose of the 1994 Northwest Airlines Corporation
Stock and Incentive Plan (the "Plan") is to motivate, attract and retain key
employees and to further the growth, development and financial success of
Northwest Airlines Corporation (the "Company") and its Subsidiaries by aligning
the personal interests of key employees, through the ownership of shares of the
Company's Common Stock and through other incentives, with those of the Company
and the Company's shareholders. The Plan permits the granting of Stock Options,
Stock Appreciation Rights, Restricted Stock and Other Stock Based Awards.

         1.2 DURATION. Upon approval by the Board, the Plan shall become
effective March 1, 1994 (the "Effective Date"), and shall remain in effect until
the earlier of the date the Plan is terminated pursuant to Article 7 hereof, or
February 29, 2004 (the "Termination Date"). No Award may be granted under the
Plan on or after the Termination Date, but Awards made prior to the Termination
Date may be exercised, vested or otherwise effectuated beyond that date unless
otherwise limited. If the Plan is not approved by shareholders of the Company
prior to the first anniversary of the adoption of the Plan by the Board, the
Plan and all Awards thereunder shall terminate on such

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anniversary date. The required shareholder approval shall be the vote of the
holders of a majority of the capital stock of the Company voting thereon,
provided that the total vote cast constitutes a majority of the outstanding
shares of the Company entitled to vote thereon.

ARTICLE 2. DEFINITIONS

         2.1 DEFINITIONS. Whenever used in the Plan, the following terms shall
have the meanings set forth below:

                  (a) "AWARD" means a grant under this Plan of Stock Options,
Restricted Stock, Stock Appreciation Rights or Other Stock Based Awards.

                  (b) "AWARD AGREEMENT" means the document which evidences an
Award and which sets forth the terms, conditions and limitations relating to
such Award.

                  (c) "BOARD" means the Board of Directors of the Company.

                  (d) "CODE" means the Internal Revenue Code of 1986, as amended
from time to time.

                  (e) "COMMITTEE" means the group of individuals administering
the Plan, which shall be the Compensation Committee of the Board or any other
committee of the Board performing similar functions as appointed from time to
time by the Board and constituted so as to permit the Plan to comply with Rule
16b-3 under the Exchange Act, or any successor rule thereto. From and after the
first meeting of shareholders at

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which directors are to be elected that occurs after July 1, 1994, the Committee
shall contain at least two "Outside Directors" as that term is defined under
Section 162(m)of the Code.

                  (f) "COMPANY" means Northwest Airlines Corporation, a Delaware
corporation.

                  (g) "DISABILITY" means disability within the meaning of
Section 22(e)(3) of the Code, as determined by the Committee.

                  (h) "EFFECTIVE DATE" means March 1, 1994. (i) "ELIGIBLE
EMPLOYEE" means any executive or other employee of the Company or any
Subsidiary.

                  (j) "EXCHANGE ACT" means the Securities Exchange Act of 1934,
as amended from time to time.

                  (k) "FAIR MARKET VALUE" means, with respect to any particular
date, the average of the highest and lowest price of a Share as reported on the
consolidated tape of New York Stock Exchange listed securities (or other
principal reporting system, as determined by the Committee).

                  (l) "INCENTIVE STOCK OPTION" or "ISO" means an option to
purchase Shares, granted pursuant to Section 6.1, which is designated as an
Incentive Stock Option and is intended to meet the requirements of Section 422
of the Code.

                  (m) " INSIDER" means an officer of the Company as the term
"officer" is defined under Rule 16a-1(f) under the Exchange Act.

                  (n) "NONQUALIFIED STOCK OPTION" or "NQSO" means an

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option to purchase Shares, granted pursuant to Section 6.1, which is not
designated as an Incentive Stock Option.

                  (o) "OTHER STOCK BASED AWARD" means an Award, granted pursuant
to Section 6.4, other than a Stock Option, Restricted Stock or SAR, that is paid
with, valued in whole or in part by reference to, or is otherwise based on
Shares.

                  (p) "PARTICIPANT" means an Eligible Employee selected by the
Committee to receive an Award under the Plan.

                  (q) "PERSON" means any person, firm, partnership, corporation
or other entity.

                  (r) "PLAN" means the 1994 Northwest Airlines Corporation Stock
Incentive Plan.

                  (s) "RESTRICTED STOCK" means an Award granted to a Participant
pursuant to Section 6.3.

                  (t) "RETIREMENT" means separation from service with the
Company or a Subsidiary on or after attainment of age 65 or, with the advance
written consent by the Committee that such separation will be treated as a
Retirement hereunder, separation from service with the Company or a Subsidiary
prior to age 65.

                  (u) "SHARES" means the issued or unissued shares of the Common
Stock, par value $.01 per share, of Northwest Airlines Corporation (the "Common
Stock").

                  (v) "STOCK APPRECIATION RIGHT" or "SAR" means the grant,
pursuant to Section 6.2, of a right to receive a payment from the Company, in
the form of stock, cash or a combination of both, equal to the excess of the
Fair Market Value of one or

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more Shares over the exercise price of such Shares under the terms of such Stock
Appreciation Right.

                  (w) "STOCK OPTION" means the grant, pursuant to Section 6.1,
of a right to purchase a specified number of Shares during a specified period at
a designated price, which may be an Incentive Stock Option or a Nonqualified
Stock Option.

                  (x) "SUBSIDIARY" means a subsidiary of the Company, as defined
in Section 424(f) of the Code.

ARTICLE 3. ADMINISTRATION

         3.1 AUTHORITY. The Plan shall be administered by the Committee, which
shall have full and exclusive power, subject to the provisions hereof, to make
all determinations which may be necessary or advisable for the administration of
the Plan, including:

                  (a) select Eligible Employees to whom Awards are granted;

                  (b) determine the size and types of Awards;

                  (c) determine the terms and conditions of such Awards in a
manner consistent with the Plan;

                  (d) determine whether, to what extent and under what
circumstances, Awards may be settled, paid or exercised in cash, shares, or
other Awards, or other property or canceled, forfeited or suspended;

                  (e) construe and interpret the Plan and any agreement or
instrument entered into under the Plan;

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                  (f) establish, amend or waive rules and regulations for the
Plan's administration; and

                  (g) amend (subject to the provisions of Section 4.4 and
Article 7) the terms and conditions of any outstanding Award to the extent such
terms and conditions are within its discretion.

         3.2 DECISIONS BINDING. All determinations made by the Committee arising
out of or in connection with the interpretation and administration of the Plan
and all related orders or resolutions of the Board of Directors shall be final,
conclusive and binding on all persons, including the Company, its Subsidiaries,
its shareholders, Participants, and their estates and beneficiaries.

ARTICLE 4. SHARES SUBJECT TO THE PLAN

         4.1 NUMBER OF SHARES. Subject to adjustment as provided in Section 4.4,
no more than 5,000,000 Shares may be issued under the Plan. The number of Shares
subject to Awards granted under the Plan to any one individual in any fiscal
year of the Company shall not be more than 250,000 Shares. These Shares may
consist in whole or in part of authorized and unissued Shares, or of treasury
Shares. No fractional Shares shall be issued under the Plan; however, cash may
be paid in lieu of any fractional Shares in settlements of Awards under the
Plan. For purposes of determining the number of Shares remaining available for
issuance under the Plan:

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                  (a) The grant of an Award shall reduce the authorized pool of
Shares by the number of Shares subject to such Award while such Award is
outstanding, except to the extent that such an Award is in tandem with another
Award covering the same or fewer Shares which has already been taken into
account in determining the authorized pool of Shares.

                  (b) Shares covered by SARs that are not issued upon the
exercise of such SAR shall increase the authorized pool of Shares.

                  (c) To the extent that an Award (other than an SAR) is settled
in cash or any form other than in Shares, the authorized pool of Shares shall be
increased by the appropriate number of Shares represented by such settlement of
the Award, as determined at the sole discretion of the Committee (subject to the
limitation set forth in Section 4.2).

         4.2 LAPSED AWARDS. If any Award (other than an Award of Shares) granted
under the Plan is canceled, terminates, expires or lapses for any reason, any
Shares subject to such Award shall increase the authorized pool of Shares;
provided, however, that to the extent that such Award was granted in tandem with
another Award, any Shares issued pursuant to the exercise or settlement of such
other Award shall not increase the authorized pool of Shares.

         4.3 EFFECT OF ACQUISITION. Any Awards granted by the Company in
substitution for awards or rights issued by a company whose shares or assets are
acquired by the Company or a

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Subsidiary shall not reduce the number of Shares available for grant under the
Plan.

         4.4 ADJUSTMENTS IN AUTHORIZED SHARES. Subject to Article 7, in the
event of any merger, reorganization, consolidation, recapitalization,
separation, spin-off, liquidation, stock dividend, split-up, Share combination
or other change in the corporate or capital structure of the Company affecting
the Shares, the Committee shall adjust the number and class of Shares which may
be delivered under the Plan, and the number and class of and/or price of Shares
subject to outstanding Awards granted under the Plan, in the manner determined
by the Committee in its sole discretion to prevent dilution or enlargement of
rights; provided that the number of Shares subject to any Award shall always be
a whole number.

         4.5 COMMITTEE DETERMINATION. In determining the number of Shares
available for issuance under the Plan as contemplated by this Article 4, the
Committee shall interpret and apply the provisions of this Article so as to
permit the Plan to comply with Rule l6b-3 under the Exchange Act, or any
successor rule thereto.

ARTICLE 5. PARTICIPATION

         5.1 SELECTION OF PARTICIPANTS. Subject to the provisions

of the Plan, the Committee may from time to time select, from all Eligible
Employees, those to whom Awards shall be granted

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and shall determine the nature and amount of each Award. No Eligible Employee
shall have the right to receive an Award under the Plan, or, if selected to
receive an Award, the right to continue to receive Awards. Further, no
Participant shall have any rights, by reason of the grant of any Award under the
Plan to continued employment by the Company or any Subsidiary. There is no
obligation for uniformity of treatment of Participants under the Plan.

         5.2 AWARD AGREEMENT. Each Award granted under the Plan shall be
evidenced by an Award Agreement that shall specify the terms, conditions,
limitations and such other provisions applicable to the Award as the Committee
shall determine.

ARTICLE 6. AWARDS

         Awards may be granted by the Committee to Eligible Employees at any
time, and from time to time prior to the Termination Date, as the Committee
shall determine. The Committee shall have complete discretion in determining the
number of Awards to grant (subject to the Share limitations set forth in Section
4.1) and, consistent with the provisions of the Plan, the terms, conditions and
limitations pertaining to such Awards.

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         6.1 STOCK OPTIONS.

                  (a) OPTION PRICE. The option price for a Stock Option shall be
determined by the Committee; provided that Incentive Stock Options may not be
granted at a price less than one hundred percent (100%) of the Fair Market Value
of a Share on the date the Incentive Stock Option is granted.

                  (b) PERIOD OF EXERCISE. A Stock Option may be exercised at
such times as may be specified in an Award Agreement, in whole or in
installments, which may be cumulative and shall expire at such time as the
Committee shall determine at the time of grant; provided that no Stock Option
shall be exercisable later than ten (10) years after the date granted. The
Committee may make provision for exercisability in the event of death,
Disability, Retirement or other termination of employment. The Committee may
also amend any Stock Option to accelerate the dates after which the Option may
be exercised in whole or in part.

                  (c) ADDITIONAL PROVISIONS FOR ISOS. No ISO shall be granted to
any employee who, at the time the Stock Option is granted, owns (directly, or
within the meaning of section 424(d) of the Code) more than ten percent of the
total combined voting power of all classes of stock of the Company or of any
Subsidiary, unless (a) the option price under such Stock Option is at least 110
percent of the Fair Market Value of a share of Stock on the date the Stock
Option is granted and (b) the expiration date of such Stock Option is a date not
later than the day preceding the fifth anniversary of the date on which the
Stock Option is granted.

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                  (d) METHOD OF EXERCISE. A Stock Option, or portion thereof,
shall be exercised by delivery of a written notice of exercise to the Company
and payment of the full price of the Shares being purchased pursuant to the
Option. An optionee may exercise a Stock Option with respect to less than the
full number of shares for which the Option may then be exercised, but an
optionee must exercise the Stock Option in full shares of Stock. The price of
Stock purchased pursuant to a Stock Option, or portion thereof, may be paid:

                           (i) in United States dollars in cash or by check,
bank draft or money order payable to the order of the Company,

                           (ii) through the delivery of shares of Stock with an
aggregate Fair Market Value on the date of exercise equal to the option price,

                           (iii) to the extent authorized by the Committee, by
delivery of irrevocable instructions to a financial institution to deliver
promptly to the Company the portion of sale or loan proceeds sufficient to pay
the option price.

                           (iv) to the extent authorized by the Committee, by
the withholding of Shares otherwise issuable on exercise with an aggregate Fair
Market Value on the date of exercise equal to the Option Price.

                           (v) by any combination of the above methods of
payment or by any other means which the Committee determines to be consistent
with the Plan's purpose and applicable law.

         6.2 STOCK APPRECIATION RIGHTS.

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                  (a) SARs may be granted at a price determined by the
Committee, and may be granted in tandem with a Stock Option, such that the
exercise of the SAR or related Stock Option will result in a forfeiture of the
right to exercise the related Stock Option for an equivalent number of shares,
or independently of any Stock Option.

                  (b) An SAR may be exercised at such times as may be specified
in an Award Agreement, in whole or in installments, which may be cumulative and
shall expire at such time as the Committee shall determine at the time of grant;
provided that no SAR shall be exercisable later than ten (10) years after the
date granted. The Committee may amend any SAR to accelerate the dates after
which the SAR may be executed in whole or in part.

                  (c) SARs shall be exercised by the delivery of a written
notice of exercise to the Company setting forth the number of Shares with
respect to which the SAR is to be exercised.

         6.3 RESTRICTED STOCK. Restricted stock may be granted alone or in
conjunction with other Awards under the Plan and may be conditioned upon
continued employment for a specified period, the attainment of specific
performance goals or such other factors as the Committee may determine. In
making an Award of Restricted Stock, the Committee will determine the
restrictions that will apply, the period during which the Stock is subject to
such restrictions, and the price, if any, payable by a recipient. The Committee
may amend any Award of Restricted Stock

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to accelerate the dates after which such Award may be executed in whole or in
part.

         6.4 OTHER STOCK BASED AWARDS.

                  (a) The Committee shall have complete discretion in
determining the number of Shares subject to Other Stock Based Awards the
consideration for such Awards and the terms, conditions and limitations
pertaining to same including, without limitation, restrictions based upon the
achievement of specific business objectives, tenure, and other measurements of
individual or business performance, and/or restrictions under applicable federal
or state securities laws, and conditions under which such Awards will lapse.

                  (b) Payment of Other Stock Based Awards may be in the form of
cash, shares, other Awards, or in such combinations thereof as the Committee
shall determine at the time of grant, and with such restrictions as it may
impose. Payment may be made in a lump sum or in installments as prescribed by
the Committee. The Committee may also require or permit Participants to elect to
defer the issuance of Shares or the settlement of Awards in cash under such
rules and procedures as it may establish under the Plan. The Committee may also
provide that deferred settlements include the payment or crediting of interest
on the deferred amounts or the payment or crediting of dividend equivalents on
deferred amounts denominated in Shares.

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                  (c) The Committee may, at its sole discretion, direct the
Company to issue Shares subject to such restrictive legends and/or stop transfer
instructions as the Committee deems appropriate.

ARTICLE 7. AMENDMENT, MODIFICATION AND TERMINATION.

         7.1 The Board may at any time, or from time to time, suspend or
terminate the Plan in whole or in part or amend it in such respects as the Board
may deem appropriate, provided, however, that no such amendment shall be made,
which would, without approval of the shareholders (except as provided in Section
7.4):

                  (a) materially modify the eligibility requirements for
receiving Awards;

                  (b) increase the total number of shares of Common Stock which
may be issued pursuant to Awards, except as is provided for in accordance with
Article 4 of the Plan;

                  (c) extend the period during which Awards may be granted; or

                  (d) materially increase in any other way the benefits accruing
to Participants.

         7.2 No amendment, suspension or termination of this Plan or any Award
shall, without the Participant's consent, alter or impair any of the rights or
obligations under any Award theretofore granted to an Participant under the
Plan.

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         7.3 The Board may amend this Plan, subject to the limitations cited
above, in such manner as it deems necessary to permit the granting of Awards
meeting the requirements of future amendments to the Code or regulations
promulgated thereunder.

         7.4 If and to the extent the provisions of Rule 16b-3 (as in effect on
the date of adoption of the Plan by the Board) under the Exchange Act permit the
amendment of stock incentive plans without compliance with one or more of the
stockholder approval requirements presently set forth in Section 7.1, then and
to that extent the restrictions on the ability of the Board to amend the Plan
set forth in Section 7.1 hereof shall terminate and the Board shall thereafter
be empowered to amend the Plan without regard to such restrictions.

ARTICLE 8. WITHHOLDING

         8.1 TAX WITHHOLDING. The Company shall have the power and the right to
deduct or withhold, or require a Participant to remit to the Company, an amount
in cash sufficient to satisfy federal, state and local taxes required by law to
be withheld in connection with a grant, exercise or payment made under or as a
result of the Plan.

         8.2 SHARE WITHHOLDING. The Committee may require one or more classes of
Participants to satisfy the withholding requirement, in whole or in part, by
having the Company withhold Shares having a Fair Market Value, on the date the
tax is to be determined, equal to the amount of withholding which is required

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by law. Alternatively, the Committee may allow a Participant to elect Share
withholding for tax purposes subject to such terms and conditions as the
Committee shall establish.

         ARTICLE 9. TRANSFERABILITY. No Award granted under the Plan may be
sold, transferred, pledged, assigned or otherwise alienated or hypothecated,
other than by will or by the laws of descent and distribution. Further, all
Awards granted to a Participant under the Plan shall be exercisable during the
Participant's lifetime only by the Participant. Notwithstanding the foregoing,
the designation of a beneficiary by a Participant does not constitute a
transfer.

         ARTICLE 10. UNFUNDED PLAN. The Plan shall be unfunded and the Company
shall not be required to segregate any assets that may at time be represented by
Awards under the Plan. Any liability of the Company to any person with respect
to any Award under the Plan shall be based solely upon any contractual
obligations that may be effected pursuant to the Plan. No such obligation of the
Company shall be deemed to be secured by any pledge of, or other encumbrance on,
any property or assets of the Company.

         ARTICLE 11. SUCCESSORS. All obligations of the Company under the Plan
with respect to Awards granted hereunder shall be binding on any successor to
the Company, whether the existence of such successor is the result of a direct
or indirect purchase, merger, consolidation or otherwise, of all or

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substantially all of the substantially all of the business and/or assets of the
Company.

         ARTICLE 12. SECURITIES LAW COMPLIANCE. The Plan is intended to comply
with all applicable conditions of Rule 16b-3 or any successor rule thereto under
the Exchange Act. To the extent any provision of the Plan or action by the
Committee fails to so comply, it shall be deemed null and void, to the extent
permitted by law and deemed advisable by the Committee. Further, each Award
shall be subject to the requirement that, if at any time the Committee shall
determine, in its sole discretion, that the listing, registration or
qualification of any Award under the Plan upon any securities exchange or under
any state or federal law, or the consent or approval of any government
regulatory body, is necessary or desirable as a condition of, or in connection
with, the granting of such Award or the grant or settlement thereof, such Award
may not be exercised or settled in whole or in part unless such listing,
registration, qualification, consent or approval shall have been effected or
obtained free of any conditions not acceptable to the Committee.

         ARTICLE 13. CHANGE OF CONTROL

         13.1 ACCELERATION. Notwithstanding any other provision of the Plan or
any Award Agreement to the contrary, upon the occurrence of a Change of Control
(as defined below) (i) all outstanding Stock Options and Stock Appreciation
Rights granted pursuant to the Plan, to the extent not theretofore exercised or
canceled, shall become exercisable in full for the remainder of

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the applicable term of such Award; and (ii) all restrictions applicable to all
outstanding Awards granted pursuant to the Plan, other than Stock Options and
Stock Appreciation Rights, shall be deemed to have been satisfied and such
Awards shall immediately vest in full.

         13.2 DEFINITIONS. For purposes of this Article 13, the following terms
shall have the meanings set forth below:

                  (a) "CHANGE OF CONTROL" means any one of the following:

                           (i) Individuals who, as of June 1, 2000, constitute
the Board of Directors of the Company (the "Incumbent Board") cease for any
reason to constitute at least a majority of such Board; PROVIDED, HOWEVER, that
any individual becoming a director subsequent to the date hereof, whose
election, or nomination for election by the Company's stockholders, was approved
by a vote of at least a majority of the directors then comprising the Incumbent
Board shall be considered as though such individual were a member of the
Incumbent Board, but excluding, for this purpose, any such individual whose
initial assumption of office occurs as a result of an actual or threatened
election contest with respect to the election or removal of directors or other
actual or threatened solicitation of proxies or consents by or on behalf of a
Person (as defined below) other than the Board of Directors of the Company; or

                           (ii) Consummation by the Company of a reorganization,
merger or consolidation or sale or other disposition of all or substantially all
of the assets of the

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Company (a "Business Combination"), in each case, unless, following such
Business Combination, (A) all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the then outstanding
shares of Common Stock of the Company (or its successor by merger, consolidation
or purchase of all or substantially all of its assets) (the "Outstanding Common
Stock") and the combined voting power of the then outstanding voting securities
of the Company (or its successor by merger, consolidation or purchase of all or
substantially all of its assets) entitled to vote generally in the election of
directors (the "Outstanding Voting Securities") immediately prior to such
Business Combination beneficially own, directly or indirectly, more than 50% of,
respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership
immediately prior to such Business Combination of the Outstanding Common Stock
and Outstanding Voting Securities, as the case may be, and (B) at least a
majority of the members of the board of directors of the corporation resulting
from such Business Combination were members of the Incumbent Board at the time
of the execution of the initial agreement or of the action

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of such Board providing for such Business Combination; or

                           (iii) Approval by the stockholders of the Company of
a complete liquidation or dissolution of the Company.

                  (b) "PERSON" means any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act.

ARTICLE 14. REQUIREMENTS OF LAW

         14.1 REQUIREMENTS OF LAW. The granting of Awards and the issuance of
Shares under the Plan shall be subject to all applicable laws, rules and
regulations and to such approvals by any governmental agencies or national
securities exchanges as may be required.

         14.2 SEVERABILITY. In the event any provision of the Plan shall be held
illegal or invalid for any reason, the illegality or invalidity shall not affect
the remaining parts of the Plan, and the Plan shall be construed and enforced as
if the illegal or invalid provision had not been included.

         14.3 GOVERNING LAW. To the extent not preempted by federal law, the
Plan and all Award Agreements shall be construed in accordance with and governed
by the laws of the State of Minnesota.

ARTICLE 15. MISCELLANEOUS PROVISIONS

         15.1 PLAN DOES NOT CONFER EMPLOYMENT OR STOCKHOLDER RIGHTS. The right
of the Company to terminate (whether by dismissal, discharge, retirement or
otherwise) the Optionee's employment

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with it at any time at will, or as otherwise provided by any agreement between
the Company and the Optionee, is specifically reserved. Neither the Optionee nor
any person entitled to exercise the Optionee's rights in the event of the
Optionee's death shall have any of the rights of a stockholder with respect to
the shares subject to each Option, except to the extent that, and until, such
shares shall have been issued upon the exercise of each Option.

         15.2 PLAN EXPENSES. Any expenses of administering this Plan shall be
borne by the Company.

         15.3 USE OF EXERCISE PROCEEDS. Payments received from Optionees upon
the exercise of Options shall be used for the general corporate purposes of the
Company, except that any stock received or withheld in payment may be retired,
or retained in the Company's treasury and reissued.<PAGE>
                                                                    EXHIBIT 10.2

                              AMENDED AND RESTATED
                         NORTHWEST AIRLINES CORPORATION
                            1999 STOCK INCENTIVE PLAN

                       (AS AMENDED THROUGH JUNE 29, 2000)

SECTION 1.  PURPOSE.
            --------

     The purpose of the Northwest Airlines Corporation 1999 Stock Incentive Plan
(the "Plan") is to promote the interests of the Company and its stockholders by
assisting the Company and its Affiliates in attracting and retaining employees,
to offer such employees incentives to put forth maximum efforts for the success
of the Company and its Affiliates and to further align employees' interests with
those of the Company's stockholders.

SECTION 2.  DEFINITIONS.
            ------------

     As used in the Plan, the following terms shall have the meanings set forth
below:

         (a) "Affiliate" shall mean (i) any entity that, directly or indirectly
through one or more intermediaries, is controlled by the Company, and (ii) any
entity in which the Company has a significant equity interest, in each case as
determined by the Committee.

         (b) "Award" shall mean any Option, Stock Appreciation Right, Restricted
Stock, Restricted Stock Unit, Performance Award, or Other Stock-Based Award
granted under the Plan.

         (c) "Award Agreement" shall mean any written agreement, contract or
other instrument or document evidencing any Award granted under the Plan.

         (d) "Cause" shall mean with respect to the termination of a
Participant's employment with the Company or any Affiliate (i) an act or acts of
personal dishonesty by the Participant intended to result in substantial
personal enrichment of the Participant at the expense of the Company or an
Affiliate; (ii) an act or acts of personal dishonesty by the Participant
intended to cause substantial injury to the Company or an Affiliate; (iii)
material breach (other than as a result of a Disability) by the Participant of
the Participant's obligations under the terms and conditions of the
Participant's employment, which action was (A) undertaken without a reasonable
belief that the action was in the best interest of the Company or an Affiliate
and (B) not remedied within a reasonable period of time after receipt of written
notice from the Company or an Affiliate specifying the alleged breach, or (iv)
the conviction of the Participant of a felony.

         (e) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time, and any regulations promulgated thereunder. A reference to
any provision of the Code shall include reference to any successor provision of
the Code.

         (f) "Committee" shall mean a committee of the Company designated by the
Board of Directors of the Company to administer the Plan, which shall consist of
members appointed from time to time by the Board of Directors.

                                      -1-

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         (g) "Company" shall mean NORTHWEST AIRLINES CORPORATION, a Delaware
corporation, and any successor corporation.

         (h) "Disability" shall mean the Participant's physical or mental
condition which prevents continued performance of his or her duties and for
which the Participant establishes by medical evidence that such condition will
be permanent and continuous during the remainder of the Participant's life or is
likely to be of at least three (3) years' duration.

         (i) "Eligible Person" shall mean any employee, consultant or
independent contractor providing services to the Company or any Affiliate who
the Committee determines to be an Eligible Person.

         (j) "Fair Market Value" shall mean, with respect to any property
(including, without limitation, any shares or other securities), the fair market
value of such property determined by such methods or procedures as shall be
established from time to time by the Committee. Notwithstanding the foregoing,
unless otherwise determined by the Committee, the Fair Market Value of shares on
a given date for purposes of the Plan shall be the average of the opening and
closing sale prices of the shares as reported on the NASDAQ National Market
System on such date or, if such System is not open for trading on such date, on
the day closest to such date when such System is open for trading.

         (k) "Option" shall mean an option granted under Section 6(a) of the
Plan that shall not be an incentive stock option within the meaning of Section
422 of the Code or any successor provision.

         (l) "Other Stock-Based Award" shall mean any right granted under
Section 6(e) of the Plan.

         (m) "Participant" shall mean an Eligible Person designated to be
granted an Award under the Plan.

         (n) "Performance Award" shall mean any right granted under Section 6(d)
of the Plan.

         (o) "Person" shall mean any individual, corporation, partnership,
association or trust.

         (p) "Plan" shall mean this 1999 Stock Incentive Plan, as amended from
time to time.

         (q) "Restricted Stock" shall mean any Share granted under Section 6(c)
of the Plan.

         (r) "Restricted Stock Unit" shall mean any unit granted under Section
6(c) of the Plan evidencing the right to receive a Share (or a cash payment
equal to the Fair Market Value of a Share) at some future date.

         (s) "Retirement" shall mean separation from service with the Company or
an Affiliate pursuant to a pension plan maintained by the Company or such
Affiliate.

         (t) "Shares" shall mean shares of Common Stock, $0.01 par value, of the
Company or such other securities or property as may become subject to Awards
pursuant to an adjustment made under Section 4(c) of the Plan.

         (u) "Stock Appreciation Right" shall mean any right granted under
Section 6(b) of the Plan.

SECTION 3.  ADMINISTRATION.

                                      -2-

<PAGE>

         (a) POWER AND AUTHORITY OF THE COMMITTEE. The Plan shall be
administered by the Committee. Subject to the express provisions of the Plan and
to applicable law, the Committee shall have full power and authority to:

                  (i)  designate Participants;

                  (ii) determine the type or types of Awards to be granted to
         each Participant under the Plan;

                  (iii) determine the number of shares to be covered by (or with
         respect to which payments, rights or other matters are to be calculated
         in connection with) each Award;

                  (iv)  determine the terms and conditions of any Award or Award
         Agreement;

                  (v) amend the terms and conditions of any Award or Award
         Agreement and accelerate the exercisability of Options or the lapse of
         restrictions relating to Restricted Stock, Restricted Stock Units or
         other Awards;

                  (vi) determine whether, to what extent and under what
         circumstances Awards may be exercised in cash, shares, other
         securities, other Awards or other property, or canceled, forfeited or
         suspended;

                  (vii) determine whether, to what extent and under what
         circumstances cash, shares, other securities, other Awards, other
         property and other amounts payable with respect to an Award under the
         Plan shall be deferred either automatically or at the election of the
         holder thereof or the Committee;

                  (viii) interpret and administer the Plan and any instrument or
         agreement relating to, or Award made under, the Plan;

                  (ix) establish, amend, suspend or waive such rules and
         regulations and appoint such agents as it shall deem appropriate for
         the proper administration of the Plan; and

                  (x) make any other determination and take any other action
         that the Committee deems necessary or desirable for the administration
         of the Plan.

Unless otherwise expressly provided in the Plan, all designations,
determinations, interpretations and other decisions under or with respect to the
Plan or any Award shall be within the sole discretion of the Committee, may be
made at any time and shall be final, conclusive and binding upon any
Participant, any holder or beneficiary of any Award and any employee of the
Company or any Affiliate.

         (b) DELEGATION. Except to the extent prohibited by applicable law, the
Committee may allocate all or any portion of its powers and duties under the
Plan to any one or more of its members and may delegate its powers and duties
under the Plan to any person or persons selected by it, subject to such terms,
conditions and limitations as the Committee may establish in its sole
discretion. Any such allocation or delegation may be revoked by the Committee at
any time.

                                      -3-

<PAGE>

         (c) POWER AND AUTHORITY OF THE BOARD OF DIRECTORS. Notwithstanding
anything to the contrary contained herein, the Board of Directors may, at any
time and from time to time, without any further action of the Committee,
exercise the powers and duties of the Committee under the Plan.

SECTION 4.  SHARES AVAILABLE FOR AWARDS.

         (a) SHARES AVAILABLE UNDER THE PLAN. Subject to adjustment as provided
in Section 4(c), the aggregate number of shares that may be issued under all
Awards under the Plan shall be 4,000,000, subject to the following:

         (i) If any shares covered by an Award or to which an Award relates are
     not purchased or are forfeited, or if an Award otherwise terminates without
     delivery of any shares, then the number of shares counted against the
     aggregate number of shares available under the Plan with respect to such
     Award, to the extent of any such forfeiture or termination, shall again be
     available for granting Awards under the Plan.

         (ii) If the exercise price of any Option granted under the Plan is
     satisfied by tendering shares to the Company, only the number of shares
     issued net of the shares tendered shall be deemed issued under the Plan.

         (iii) Shares delivered under the Plan in settlement, assumption or
     substitution of outstanding awards (or obligations to grant future awards)
     under the plans or arrangements of another entity shall not reduce the
     aggregate number of shares available under the Plan to the extent that such
     settlement, assumption or substitution is a result of the Company or an
     Affiliate acquiring another entity (or an interest in another entity).

Shares to be issued under the Plan shall be shares reacquired and held in the
treasury of the Company.

         (b) ACCOUNTING FOR AWARDS. For purposes of this Section 4, if an Award
entitles the holder thereof to receive or purchase shares, the number of shares
covered by such Award or to which such Award relates shall be counted on the
date of grant of such Award against the aggregate number of shares available for
granting Awards under the Plan.

         (c) ADJUSTMENTS. In the event that the Committee shall determine that
any dividend or other distribution (whether in the form of cash, shares, other
securities or other property), recapitalization, stock split, reverse stock
split, reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase or exchange of shares or other securities of the Company, issuance of
warrants or other rights to purchase shares or other securities of the Company
or other similar corporate transaction or event affects the shares such that an
adjustment is determined by the Committee to be appropriate in order to prevent
dilution or enlargement of the benefits or potential benefits intended to be
made available under the Plan, then the Committee shall, in such manner as it
may deem equitable, adjust any or all of (i) the number and type of shares (or
other securities or other property) which thereafter may be made the subject of
Awards, (ii) the number and type of shares (or other securities or other
property) subject to outstanding Awards and (iii) the purchase or exercise price
with respect to any Award; provided, however, that the number of shares covered
by any Award or to which such Award relates shall always be a whole number.

SECTION 5.  ELIGIBILITY.

                                      -4-

<PAGE>

         Any Eligible Person shall be eligible to be designated a Participant.
In determining which Eligible Persons shall receive an Award and the terms of
any Award, the Committee may take into account the nature of the services
rendered by the respective Eligible Persons, their present and potential
contributions to the success of the Company or such other factors as the
Committee, in its discretion, shall deem relevant.

SECTION 6.  AWARDS.

         (a) OPTIONS. The Committee is hereby authorized to grant Options to
Participants with the following terms and conditions and with such additional
terms and conditions not inconsistent with the provisions of the Plan as the
Committee shall determine:

           (i) EXERCISE PRICE. The purchase price per Share purchasable
         under an Option shall be the price specified by the Committee.

           (ii)  OPTION TERM. The term of each Option shall be fixed by the
         Committee.

           (iii) PERIOD OF EXERCISE; TERMINATION OF EMPLOYMENT. The
         Committee shall determine the time or times at which an Option may be
         exercised in whole or in part and shall provide for exercisability of
         Options in the event of death, disability, retirement or other
         termination of employment of the Participant. Unless otherwise provided
         in any applicable Award Agreement or otherwise determined by the
         Committee, the following provisions shall apply with respect to the
         exercisability of Options previously granted to a Participant under the
         Plan in the event the Participant's employment with the Company or any
         Affiliate is terminated:

                  (A) RETIREMENT. If a Participant's employment with the Company
         or any Affiliate is terminated by reason of the Participant's
         Retirement, then any portion of any Option previously granted to the
         Participant that was exercisable as of the date of such Retirement and
         not previously exercised may be exercised by the Participant at any
         time within one (1) year after the date of such Retirement; provided,
         however, that if the Participant dies or becomes Disabled within one
         (1) year after such Retirement, then any portion of the Option that was
         exercisable as of the date of the Participant's Retirement and not
         previously exercised shall not terminate pursuant to this Section
         6(a)(iii) and may be exercised during the remainder of the term of the
         Option by the Participant or by the estate of the Participant or a
         person who shall have acquired the right to exercise the Option by
         bequest or inheritance. Any portion of any such Option that was not
         exercisable as of the date of such Retirement shall be canceled
         immediately upon such Retirement.

                  (B) DEATH OR DISABILITY. If a Participant's employment with
         the Company or any Affiliate is terminated by reason of the
         Participant's death or Disability, then any portion of any Option
         previously granted to the Participant that was exercisable as of the
         date of such death or Disability and not previously exercised shall not
         terminate and may be exercised during the remainder of the term of the
         Option by the Participant or by the estate of the Participant or a
         person who shall have acquired the right to exercise the Option by
         bequest or inheritance. Any portion of any such Option that was not
         exercisable as of the date of such death or Disability shall be
         canceled immediately upon such death or Disability.

                                      -5-

<PAGE>

                  (C) TERMINATION OF EMPLOYMENT FOR CAUSE. If a Participant's
         employment with the Company or any Affiliate shall terminate for Cause,
         any Option previously granted to the Participant, to the extent not
         previously exercised, shall be canceled immediately upon such
         termination of employment.

                  (D) TERMINATION OF EMPLOYMENT OTHER THAN FOR CAUSE, DEATH,
         DISABILITY OR RETIREMENT. If a Participant's employment with the
         Company or any Affiliate shall be terminated otherwise than by reason
         of Cause, death, Disability or Retirement, any portion of any Option
         previously granted to the Participant that was exercisable as of the
         date of such termination of employment and not previously exercised may
         be exercised by the Participant at any time within ninety (90) days
         after the date of such termination of employment. Any portion of any
         such Option that was not exercisable as of the date of such termination
         of employment shall be canceled immediately upon such termination of
         employment.

         (iv) MANNER OF EXERCISE. All Options granted under the Plan shall be
     exercised by delivery of written notice of exercise to the Secretary of the
     Company and payment of the exercise price for the shares being purchased
     pursuant to the Option. Except as otherwise determined by the Committee,
     the exercise price for the shares purchased pursuant to an Option may be
     paid:

                  (A) in United States dollars in cash or by check, bank draft
         or money order payable to the order of the Company;

                  (B) through the delivery of shares with an aggregate Fair
         Market Value on the exercise date equal to the exercise price;

                  (C) by delivery of irrevocable instructions to a financial
         institution to sell the shares acquired upon exercise of the Option or
         a sufficient portion thereof and remit promptly to the Company the
         portion of the sale or loan proceeds sufficient to pay the exercise
         price;

                  (D) by the withholding of shares otherwise to be delivered
         upon exercise of the Option with a Fair Market Value equal to the
         exercise price; or

                  (E) by any combination of the above methods of payment or by
         such other means and in such other forms (including, without
         limitation, promissory notes, other securities, other Awards or other
         property, or any combination thereof, having a Fair Market Value on the
         exercise date equal to the relevant exercise price) as the Committee
         shall determine.

     (b) STOCK APPRECIATION RIGHTS. The Committee is hereby authorized to grant
Stock Appreciation Rights to Participants subject to the terms of the Plan and
any applicable Award Agreement. A Stock Appreciation Right granted under the
Plan shall confer on the holder thereof a right to receive upon exercise thereof
the excess of (i) the Fair Market Value of one Share on the date of exercise
(or, if the Committee shall so determine, at any time during a specified period
before or after the date of exercise) over (ii) the grant price of the Stock
Appreciation Right as specified by the Committee. Subject to the terms of the
Plan and any applicable Award Agreement, the grant price, term, methods of
exercise, dates of exercise, methods of settlement and any other terms and
conditions of any Stock Appreciation Right shall be as determined by

                                      -6-

<PAGE>

the Committee. The Committee may impose such conditions or restrictions on the
exercise of any Stock Appreciation Right as it may deem appropriate.

         (c) RESTRICTED STOCK AND RESTRICTED STOCK UNITS. The Committee is
hereby authorized to grant Awards of Restricted Stock and Restricted Stock Units
to Participants with the following terms and conditions and with such additional
terms and conditions not inconsistent with the provisions of the Plan as the
Committee shall determine:

            (i) RESTRICTIONS. Shares of Restricted Stock and Restricted Stock
         Units shall be subject to such restrictions as the Committee may impose
         (including, without limitation, any limitation on the right to vote a
         Share of Restricted Stock or the right to receive any dividend or other
         right or property with respect thereto), which restrictions may lapse
         separately or in combination at such time or times, in such
         installments or otherwise as the Committee may deem appropriate.

            (ii) STOCK CERTIFICATES. Any Restricted Stock granted under the Plan
         shall be evidenced by issuance of a stock certificate or certificates,
         which certificate or certificates shall be held by the Company. Such
         certificate or certificates shall be registered in the name of the
         Participant and shall bear an appropriate legend referring to the
         terms, conditions and restrictions applicable to such Restricted Stock.
         In the case of Restricted Stock Units, no shares shall be issued at the
         time such Awards are granted.

            (iii) FORFEITURE; DELIVERY OF SHARES. Except as otherwise determined
         by the Committee, upon termination of employment (as determined under
         criteria established by the Committee) during the applicable
         restriction period, all shares of Restricted Stock and all Restricted
         Stock Units at such time subject to restriction shall be forfeited and
         reacquired by the Company; provided, however, that the Committee may,
         when it finds that a waiver would be in the best interest of the
         Company, waive in whole or in part any or all remaining restrictions
         with respect to shares of Restricted Stock or Restricted Stock Units.
         Any Share representing Restricted Stock that is no longer subject to
         restrictions shall be delivered to the holder thereof promptly after
         the applicable restrictions lapse or are waived. Upon the lapse or
         waiver of restrictions and the restricted period relating to Restricted
         Stock Units evidencing the right to receive shares, such shares shall
         be issued and delivered to the holders of the Restricted Stock Units.

         (d) PERFORMANCE AWARDS. The Committee is hereby authorized to grant
Performance Awards to Participants subject to the terms of the Plan and any
applicable Award Agreement. A Performance Award granted under the Plan (i) may
be denominated or payable in cash, shares (including, without limitation,
Restricted Stock), other securities, other Awards or other property and (ii)
shall confer on the holder thereof the right to receive payments, in whole or in
part, upon the achievement of such performance goals during such performance
periods as the Committee shall establish. Subject to the terms of the Plan and
any applicable Award Agreement, the performance goals to be achieved during any
performance period, the length of any performance period, the amount of any
Performance Award granted, the amount of any payment or transfer to be made
pursuant to any Performance Award and any other terms and conditions of any
Performance Award shall be determined by the Committee.

         (e) OTHER STOCK-BASED AWARDS. The Committee is hereby authorized to
grant to Participants such other Awards that are denominated or payable in,
valued in whole or in part by reference to, or otherwise based on or related to,
shares (including, without limitation, securities convertible into shares), as
are deemed

                                      -7-

<PAGE>

by the Committee to be consistent with the purpose of the Plan; provided,
however, that such grants must comply with applicable law. Subject to the terms
of the Plan and any applicable Award Agreement, the Committee shall determine
the terms and conditions of such Awards. Shares or other securities delivered
pursuant to a purchase right granted under this Section 6(e) shall be purchased
for such consideration, which may be paid by such method or methods and in such
form or forms (including without limitation, cash, shares, promissory notes,
other securities, other Awards or other property or any combination thereof), as
the Committee shall determine, the value of which consideration, as established
by the Committee, shall not be less than 100% of the Fair Market Value of such
shares or other securities as of the date such purchase right is granted.

         (f)  GENERAL.
              -------

                 (i) NO CASH CONSIDERATION FOR AWARDS. Awards shall be granted
         for no cash consideration or for such minimal cash consideration as may
         be required by applicable law.

                 (ii) AWARDS MAY BE GRANTED SEPARATELY OR TOGETHER. Awards may,
         in the discretion of the Committee, be granted either alone or in
         addition to, in tandem with or in substitution for any other Award or
         any award granted under any plan of the Company or any Affiliate other
         than the Plan. Awards granted in addition to or in tandem with other
         Awards or in addition to or in tandem with awards granted under any
         such other plan of the Company or any Affiliate may be granted either
         at the same time as or at a different time from the grant of such other
         Awards or awards.

                 (iii) FORMS OF PAYMENT UNDER AWARDS. Subject to the terms of
         the Plan and of any applicable Award Agreement, payments or transfers
         to be made by the Company or an Affiliate upon the grant, exercise or
         payment of an Award may be made in such form or forms as the Committee
         shall determine (including, without limitation, cash, shares,
         promissory notes, other securities, other Awards or other property or
         any combination thereof), and may be made in a single payment or
         transfer, in installments or on a deferred basis, in each case in
         accordance with rules and procedures established by the Committee. Such
         rules and procedures may include, without limitation, provisions for
         the payment or crediting of reasonable interest on installment or
         deferred payments.

                 (iv)  LIMITS ON TRANSFER OF AWARDS. Unless otherwise determined
         by the Committee:

                         (A) no Award and no right under any such Award shall be
                  transferable by a Participant otherwise than by will or by the
                  laws of descent and distribution; provided, however, that, if
                  so determined by the Committee, a Participant may, in the
                  manner established by the Committee, designate a beneficiary
                  or beneficiaries to exercise the rights of the Participant and
                  receive any property distributable with respect to any Award
                  upon the death of the Participant;

                         (B) each Award or right under any Award shall be
                  exercisable during the Participant's lifetime only by the
                  Participant or, if permissible under applicable law, by the
                  Participant's guardian or legal representative; and

                         (C) no Award or right under any such Award may be
                  pledged, alienated, attached or otherwise encumbered, and any
                  purported pledge, alienation, attachment or encumbrance
                  thereof shall be void and unenforceable against the Company or
                  any Affiliate.

                                      -8-

<PAGE>

         (v)  TERM OF AWARDS. The term of each Award shall be for such period as
     may be determined by the Committee.

         (vi) RESTRICTIONS; SECURITIES EXCHANGE LISTING. All certificates for
     shares or other securities delivered under the Plan pursuant to any Award
     or the exercise thereof shall be subject to such stop transfer orders and
     other restrictions as the Committee may deem advisable under the Plan or
     the rules, regulations and other requirements of the Securities and
     Exchange Commission and any applicable federal or state securities laws,
     and the Committee may cause a legend or legends to be placed on any such
     certificates to make appropriate reference to such restrictions. If the
     shares or other securities are traded on a securities exchange, the Company
     shall not be required to deliver any shares or other securities covered by
     an Award unless and until such shares or other securities have been
     admitted for trading on such securities exchange.

SECTION 7.  AMENDMENT AND TERMINATION; ADJUSTMENTS.
            ---------------------------------------

         Except to the extent prohibited by applicable law and unless otherwise
expressly provided in an Award Agreement or in the Plan:

         (a)  AMENDMENTS TO THE PLAN. The Board of Directors of the Company may
amend, alter, suspend, discontinue or terminate the Plan.

         (b) AMENDMENTS TO AWARDS. The Committee may waive any conditions of or
rights of the Company under any outstanding Award, prospectively or
retroactively. The Committee may not amend, alter, suspend, discontinue or
terminate any outstanding Award, prospectively or retroactively, without the
consent of the Participant or holder or beneficiary thereof, except as otherwise
herein provided.

         (c) CORRECTION OF DEFECTS, OMISSIONS AND INCONSISTENCIES. The Committee
may correct any defect, supply any omission or reconcile any inconsistency in
the Plan or any Award in the manner and to the extent it shall deem desirable to
carry the Plan into effect.

SECTION 8.  CHANGE OF CONTROL.
            ------------------

         (a) Notwithstanding any other provision of the Plan or any Award
Agreement to the contrary, upon the occurrence of a Change of Control (as
defined below) (i) all outstanding Options and Stock Appreciation Rights granted
pursuant to the Plan, to the extent not theretofore exercised or canceled, shall
become exercisable in full for the remainder of the applicable term of such
Award; and (ii) all restrictions applicable to all outstanding Awards granted
pursuant to the Plan, other than Stock Options and Stock Appreciation Rights,
shall be deemed to have been satisfied and such Awards shall immediately vest in
full.

         (b)  For purposes of the Plan, the term "Change of Control" shall mean
any one of the following:

                  (i) Individuals who, as of June 1, 2000, constitute the Board
         of Directors of the Company (the "Incumbent Board") cease for any
         reason to constitute at least a majority of such Board; PROVIDED,
         HOWEVER, that any individual becoming a director subsequent to the

                                      -9-

<PAGE>

         date hereof, whose election, or nomination for election by the
         Company's stockholders, was approved by a vote of at least a majority
         of the directors then comprising the Incumbent Board shall be
         considered as though such individual were a member of the Incumbent
         Board, but excluding, for this purpose, any such individual whose
         initial assumption of office occurs as a result of an actual or
         threatened election contest with respect to the election or removal of
         directors or other actual or threatened solicitation of proxies or
         consents by or on behalf of a Person (as defined below) other than the
         Board of Directors of the Company; or

                  (ii) Consummation by the Company of a reorganization, merger
         or consolidation or sale or other disposition of all or substantially
         all of the assets of the Company (a "Business Combination"), in each
         case, unless, following such Business Combination, (A) all or
         substantially all of the individuals and entities who were the
         beneficial owners, respectively, of the then outstanding shares of
         Common Stock of the Company (or its successor by merger, consolidation
         or purchase of all or substantially all of its assets) (the
         "Outstanding Common Stock") and the combined voting power of the then
         outstanding voting securities of the Company (or its successor by
         merger, consolidation or purchase of all or substantially all of its
         assets) entitled to vote generally in the election of directors (the
         "Outstanding Voting Securities") immediately prior to such Business
         Combination beneficially own, directly or indirectly, more than 50% of,
         respectively, the then outstanding shares of common stock and the
         combined voting power of the then outstanding voting securities
         entitled to vote generally in the election of directors, as the case
         may be, of the corporation resulting from such Business Combination
         (including, without limitation, a corporation which as a result of such
         transaction owns the Company or all or substantially all of the
         Company's assets either directly or through one or more subsidiaries)
         in substantially the same proportions as their ownership immediately
         prior to such Business Combination of the Outstanding Common Stock and
         Outstanding Voting Securities, as the case may be, and (B) at least a
         majority of the members of the board of directors of the corporation
         resulting from such Business Combination were members of the Incumbent
         Board at the time of the execution of the initial agreement or of the
         action of such Board providing for such Business Combination; or

                  (iii)  Approval by the stockholders of the Company of a
         complete liquidation or dissolution of the Company.

As used in this subsection (b), the term "Person" shall mean any individual,
entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended.

SECTION 9.  INCOME TAX WITHHOLDING.

         In order to comply with all applicable federal or state income tax laws
or regulations, the Company may take such action as it deems appropriate to
ensure that all applicable federal or state payroll, withholding, income or
other taxes, which are the sole and absolute responsibility of a Participant,
are withheld or collected from such Participant. In order to assist a
Participant in paying

                                      -10-

<PAGE>

all or a portion of the federal and state taxes to be withheld or collected upon
exercise or receipt of (or the lapse of restrictions relating to) an Award, the
Committee, in its discretion and subject to such additional terms and conditions
as it may adopt, may permit the Participant to satisfy such tax obligation by
(i) electing to have the Company withhold a portion of the shares otherwise to
be delivered upon exercise or receipt of (or the lapse of restrictions relating
to) such Award with a Fair Market Value equal to the amount of such taxes or
(ii) delivering to the Company shares other than shares issuable upon exercise
or receipt of (or the lapse of restrictions relating to) such Award with a Fair
Market Value equal to the amount of such taxes. The election, if any, must be
made on or before the date that the amount of tax to be withheld is determined.

SECTION 10.  GENERAL PROVISIONS.
             -------------------

         (a) NO RIGHTS TO AWARDS. No Eligible Person, Participant or other
Person shall have any claim to be granted any Award under the Plan, and there is
no obligation for uniformity of treatment of Eligible Persons, Participants or
holders or beneficiaries of Awards under the Plan. The terms and conditions of
Awards need not be the same with respect to any Participant or with respect to
different Participants.

         (b) AWARD AGREEMENTS. No Participant will have rights under an Award
granted to such Participant unless and until an Award Agreement shall have been
duly executed on behalf of the Company.

         (c) NO LIMIT ON OTHER COMPENSATION ARRANGEMENTS. Nothing contained in
the Plan shall prevent the Company or any Affiliate from adopting or continuing
in effect other or additional compensation arrangements, and such arrangements
may be either generally applicable or applicable only in specific cases.

         (d) NO RIGHT TO EMPLOYMENT. The grant of an Award shall not be
construed as giving a Participant the right to be retained in the employ of the
Company or any Affiliate, nor will it affect in any way the right of the Company
or an Affiliate to terminate such employment at any time, with or without cause.
In addition, the Company or an Affiliate may at any time dismiss a Participant
from employment free from any liability or any claim under the Plan, unless
otherwise expressly provided in the Plan or in any Award Agreement.

         (e)  GOVERNING LAW. The validity, construction and effect of the Plan
or any Award, and any rules and regulations relating to the Plan or any Award,
shall be determined in accordance with the laws of the State of Minnesota.

         (f) SEVERABILITY. If any provision of the Plan or any Award is or
becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction
or would disqualify the Plan or any Award under any law deemed applicable by the
Committee, such provision shall be construed or deemed amended to conform to
applicable laws, or if it cannot be so construed or deemed amended without, in
the determination of the Committee, materially altering the purpose or intent of
the Plan or the

                                      -11-

<PAGE>

Award, such provision shall be stricken as to such jurisdiction or Award, and
the remainder of the Plan or any such Award shall remain in full force and
effect.

         (g) NO TRUST OR FUND CREATED. Neither the Plan nor any Award shall
create or be construed to create a trust or separate fund of any kind or a
fiduciary relationship between the Company or any Affiliate and a Participant or
any other Person. To the extent that any Person acquires a right to receive
payments from the Company or any Affiliate pursuant to an Award, such right
shall be no greater than the right of any unsecured general creditor of the
Company or any Affiliate.

         (h) NO FRACTIONAL SHARES. No fractional shares shall be issued or
delivered pursuant to the Plan or any Award, and the Committee shall determine
whether cash shall be paid in lieu of any fractional shares or whether such
fractional shares or any rights thereto shall be canceled, terminated or
otherwise eliminated.

         (i) HEADINGS. Headings are given to the Sections and subsections of the
Plan solely as a convenience to facilitate reference. Such headings shall not be
deemed in any way material or relevant to the construction or interpretation of
the Plan or any provision thereof.

SECTION 11.  EFFECTIVE DATE OF THE PLAN.
             ---------------------------

         The Plan shall be effective as of January 28, 1999.

SECTION 12.  TERM OF THE PLAN.

         Unless the Plan shall have been discontinued or terminated as provided
in Section 7(a), the Plan shall be unlimited in duration and shall remain in
effect as long as any Awards granted pursuant to the Plan remain outstanding.

                                      -12-

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