Document:

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                                                       McDonald's Corporation 41

Exhibit 10(c). McDonald's Corporation
Supplemental Profit Sharing and Savings Plan
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Section 1 Introduction
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1.1  The Plan; the Plan Merger; History.

     (a)  The McDonald's Corporation Supplemental Profit Sharing and Savings
          Plan (the "Plan") as set forth herein is the result of the merger of
          the McDonald's Profit Sharing Plan Equalization Plan as amended and
          restated effective January 1, 1996 ("McEqual"), the McDonald's 1989
          Executive Equalization Plan as amended and restated effective January
          1, 1996 ("McCAP I") and the McDonald's Supplemental Employee Benefit
          Equalization Plan as amended and restated effective January 1, 1996
          ("McCAP II") into the McDonald's Corporation Deferred Income Plan (the
          "DIP") pursuant to a Merger Document executed by McDonald's
          Corporation ("McDonald's" or the "Company") as of September 1, 2001
          (the "Merger Document"), attached hereto as Exhibit A. The effective
          date of that merger is January 1, 2002; provided, that this Plan shall
          be considered to be in effect as of September 1, 2001 for purposes of
          permitting Participants (as defined below) to make Deferral Elections
          with respect to compensation that would otherwise be paid to them on
          or after January 1, 2002 and to make investment elections, Payment
          Elections, Installment Elections and beneficiary designations to take
          effect under this Plan on or after January 1, 2002.

     (b)  The DIP, formerly known as the McDonald's Corporation Deferred
          Incentive Plan, was established November 1, 1993. The DIP was amended
          and restated effective September 1, 1994 and was subsequently amended
          by the first amendment thereof effective as of February 1, 1996 and
          the second amendment thereof effective as of August 15, 1996. The DIP
          was subsequently amended and restated effective several times,
          including amendments and restatements effective as of January 1, 1997,
          July 15, 1997, August 1, 1998, December 1, 1998, September 1, 1999 and
          September 1, 2000.

     (c)  McEqual was established, effective January 1, 1989, by the merger,
          amendment and restatement of the McDonald's Supplemental Employee
          Benefit Equalization Plan, established effective January 1, 1983,
          approved by the shareholders on May 19, 1983, and amended and restated
          effective January 1, 1987, and the McDESOP Equalization Plan,
          established effective January 1, 1986, approved by the shareholders on
          May 23, 1986, and amended and restated effective January 1, 1987.
          McEqual was further amended and restated effective January 1, 1989,
          January 1, 1990 and January 1, 1996.

     (d)  McCAP I was established effective January 1, 1989, and amended and
          restated from time to time thereafter, with the most recent amendment
          and restatement being effective January 1, 1996.

     (e)  McCAP II (formerly, the McDonald's 1986 Tax Reform Equalization Plan)
          was amended and restated, effective January 1, 1989, January 1, 1990
          and amended and restated, effective January 1, 1996, and provided
          certain benefits previously provided by McDonald's 1986 Tax Reform
          Equalization Plan with respect to years before January 1, 1989 and
          certain additional benefits.

1.2  Purposes and Features of Plan.

     (a)  The purposes of the Plan are (i) to provide to certain
          highly-compensated employees the opportunity to elect to defer
          compensation under the "Deferred Income Feature" of the Plan, and (ii)
          to provide, under the "McCAP Feature" of the Plan, certain
          participants in the McDonald's Corporation Profit Sharing and Savings
          Plan (the "Profit Sharing Plan") with benefits that they would have
          received under the Profit Sharing Plan, absent the Limits (as defined
          in Section 1.2(b) below). These two purposes are implemented under the
          Plan's two features. The Deferred Income Feature represents a
          continuation of the DIP. The "Participants" in the Deferred Income
          Feature shall be a select group of management or highly compensated
          employees, as more fully provided in Section 2 below. The McCAP
          Feature represents a continuation of McEqual, McCAP I and McCAP II.
          The "Participants" in the McCAP Feature shall be certain employees
          whose employer and/or employee contributions under the Profit Sharing
          Plan have been or are expected to be limited by the Limits, as more
          fully provided in Section 3 below.

     (b)  The Profit Sharing Plan has, as of September 1, 2001, three main
          features, the Profit Sharing Feature, the 401(k) Feature (which
          includes participant deferrals and the employer match), and the ESOP,
          and is intended to meet the requirements of a qualified plan under
          Section 401(a) of the Internal Revenue Code of 1986, as amended (the
          "Code"). Code Section 415 places limits on the maximum amount of
          contributions and benefits that may be paid under a qualified plan
          (the "415 Limits") and Code Section 401(a)(17) limits the amount of
          compensation that may be taken into account for a Plan Year under a
          qualified plan (the

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 42 McDonald's Corporation

          "Compensation Limit"). In addition, Code Section 402(g) generally
          limits the maximum amount of employee elective deferrals under a
          qualified plan ("Elective Contribution Limit"); and elective deferrals
          to a nonqual-ified plan are not taken into account in determining
          compensation and benefits under the qualified plans ("Elective
          Deferral Exclusion") (these limits and exclusion are collectively
          referred to herein as the "Other Limits" and, together with the 415
          Limits and the Compensation Limit, as the "Limits").

1.3  Administration. The Plan shall be administered by a committee of three
     officers of the Company (the "Committee"), the members of which shall be
     appointed from time to time by the Compensation Committee of the Board of
     Directors of the Company (the "Compensation Committee"). The Committee
     shall have the powers set forth in the Plan and the power to interpret its
     provisions. Any decisions of the Committee shall be final and binding on
     all persons with regard to the Plan.

1.4  Initial Participants, Beneficiaries and Accounts. The Merger Document sets
     forth provisions for individuals who are, as of September 1, 2001,
     participants in or beneficiaries under McEqual, McCAP I, McCAP II and/or
     the DIP to become Participants in, or beneficiaries under, the Plan, and
     specifies the manner in which their Accounts initially shall be deemed
     invested and the Payment Elections and beneficiary designations that
     initially shall apply to their Accounts. The provisions of the Merger
     Document shall apply notwithstanding any other provision of this Plan.

1.5  Defined Terms. Capitalized terms used in this Plan that are not defined
     herein have the same meaning as the same term in the McDonald's Profit
     Sharing Plan. An index of terms defined in the Plan is attached as Exhibit
     B to the Plan.

Section 2 Deferred Income Feature: Participation and Deferral Elections
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2.1  Eligibility and Participation. Subject to the conditions and limitations of
     the Plan, the following individuals shall be eligible to participate in the
     Deferred Income Feature of the Plan ("Deferred Income Eligible Employees"):
     (a) all officers, regional managers, department directors and other
     employees who are in the Senior Direction Compensation Band of the Company;
     (b) international country heads who are on United States payroll of the
     Company and who are identified as eligible by the Committee; and (c)
     employees of Brands meeting the requirements set forth on Exhibit C to the
     Plan. Any Deferred Income Eligible Employee who makes a Deferred Income
     Deferral Election as described in Section 2.2 below and in accordance with
     the requirements of Sections 2.3 and 4 below shall become a Participant,
     and shall remain a Participant until the entire balance of the
     Participant's Account is distributed.

2.2  Deferral Elections. Subject to Sections 2.3 and 4 below:

     (a)  Any Deferred Income Eligible Employee may make an election (a
          "Deferred Income Deferral Election") to defer receipt of all or any
          portion (in 1% increments) of his or her compensation under the
          McDonald's Target Incentive Plan, any successor annual bonus plan of
          McDonald's, or any annual bonus plan of a Brand, in which the Deferred
          Income Eligible Employee participates (collectively, the "Annual Bonus
          Plan") that is to be paid in a subsequent calendar year. Any Deferred
          Income Eligible Employee also may make a Deferred Income Deferral
          Election to defer a percentage (in 1% increments) of his or her base
          salary for the following calendar year in accordance with the
          following schedule:
<TABLE>
<CAPTION>
          ----------------------------------------------------------------------------------------------
          Compensation Band
          (or Category of Deferred Income Eligible Employee)                 Maximum Deferral Percentage
          ==============================================================================================
<S>                                                                          <C>
          Highest paid five officers of McDonald's
          (ranked by the total of base pay and the target incentive
             under the Annual Bonus Plan for the current year)               90%

          Executive Management Band (includes Executive Vice Presidents)     80%

          Senior Leadership and Leadership Bands (includes all other
            officers and regional managers)                                  70%

          Senior Direction Band (includes Department Directors)              60%
          -----------------------------------------------------------------------------------------------
</TABLE>

          provided, however, that the Committee may, in its discretion, grant
          individual requests for higher deferral percentages of base salary;
          and provided, further, that the Committee may, in its discretion,
          authorize Deferred Income Eligible Employees to modify their deferral
          percentages of base salary as may be necessary to reflect
          organizational, title or compensation band changes. Such modification
          may only be made with respect to base salary earned and paid after the
          effective date of the modification. The first elections

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                                                       McDonald's Corporation 43

          under this Section 2.2(a) shall be permitted with respect to payments
          under the Annual Bonus Plan and base salary that are payable on or
          after January 1, 2002.

     (b)  If applicable, any Deferred Income Eligible Employee may also make a
          Deferred Income Deferral Election to defer all or a portion (in 1%
          increments) of his or her Three-Year Incentive award under the
          McDonald's Corporation 1992 Omnibus Stock Ownership Incentive Plan or
          the McDonald's Corporation 2001 Omnibus Stock Ownership Incentive
          Plan, in either case payable in 2002 or later.

     (c)  No other forms of compensation, including, but not limited to exit
          bonuses, severance bonuses or bonuses paid under the Executive
          Retention Plan during a transition or retention period, may be
          deferred under the Deferred Income Feature of the Plan.

2.3  Rules for Deferred Income Deferral Elections. Deferred Income Deferral
     Elections shall be made in accordance with Section 4 below. An individual
     shall be eligible to make a Deferred Income Deferral Election only if he or
     she is a Deferred Income Eligible Employee on the Due Date. Notwithstanding
     the foregoing, an individual who becomes a Deferred Income Eligible
     Employee after the Due Date, by reason of being hired or promoted into an
     eligible position under Section 2.1 above after the Due Date, will be
     eligible to make a Deferred Income Deferral Election, to defer base salary
     only, within 60 days after the date he or she becomes a Deferred Income
     Eligible Employee. Such a Deferred Income Deferral Election shall become
     effective, and the individual making it shall become a Participant, as soon
     as administratively feasible after the Deferred Income Deferral Election is
     made.

Section 3 McCAP Feature of Plan: Participation and Deferral Elections
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3.1  Eligibility for Benefits.
(a)  415 Limits. If an employee of the Company or of any Adopting Subsidiary who
     is a participant in the Profit Sharing Plan has the amount of employer
     contributions (including Participant Elected Contributions) and forfeitures
     that would have been allocated to his accounts under the Profit Sharing
     Plan for 2002 or a later calendar year reduced pursuant to the 415 Limits,
     the amount of each such reduction shall be credited to the employee's
     Account as provided in Section 5.1.

(b)  Compensation Limit. If an employee of the Company or of any Adopting
     Subsidiary who is a participant in the Profit Sharing Plan has the amount
     of employer contributions (including Participant Elected Contributions) and
     forfeitures that would have been allocated to his accounts under the Profit
     Sharing Plan for 2002 or a later calendar year limited as a result of the
     Compensation Limit, the amount of each such reduction shall be credited to
     the employee's Account as provided in Section 5.1 below.

(c)  Other Limits.

     (i)  Each employee of the Company or of any Adopting Subsidiary who is a
          participant in the Profit Sharing Plan as of the first day of 2002 or
          of a later calendar year (the "Specified Year") whose Specified
          Compensation exceeds the dollar amount in effect under Code Section
          414(q)(1)(B)(i) and the Treasury Regulations thereunder during August
          of the year immediately preceding the Specified Year (the "Prior
          Year") shall be entitled to the credits provided for in Section
          3.1(c)(ii) below, so long as he or she remains an employee of the
          Company or such Adopting Subsidiary as of the first day of the
          Specified Year. For these purposes, the term "Specified Compensation"
          for a Participant for a Specified Year shall mean the sum of (A) the
          amount of the Participant's annual base salary at the rate in effect
          for one of the payroll periods during August of the Prior Year, as
          specified by the Committee, and (B) the amount of the bonus, if any,
          payable to the Participant under the Annual Bonus Plan during the
          Prior Year (in each case, without regard to any elective deferrals
          thereof under the Plan, the Profit Sharing Plan or otherwise).

     (ii) There shall be credited to the Account of each Participant who is
          eligible for credits under Section 3.1(c)(i) above for a Specified
          Year an amount equal to (A) the amount, if any, the Participant would
          have received under the Profit Sharing Plan for that year (including,
          if the Participant so elects pursuant to Section 3.1(d) below, the
          amount of any elections of Participant Elected Contributions made by
          the Participant and any associated Matching Contributions) in the
          absence of the Other Limits, reduced by (B) the sum of the amounts
          allocated to the Participant's accounts under the Profit Sharing Plan
          and to the Participant's Account under Sections 3.1(a) and 3.1(b)
          above. Notwithstanding the foregoing, a Participant who does not have
          an election in effect under Section 3.1(d) below of the Plan for a
          calendar year shall not be credited with any Participant Elected
          Contributions or Employer Matching Contributions hereunder for that
          calendar year.

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 44 McDonald's Corporation

     (d)  Deferral Elections. The following provisions apply to each Participant
          who is eligible for credits under Section 3.1(c)(i) above for a
          Specified Year:

          (i)  Each such Participant may elect, by filing a written election (a
               "McCAP Deferral Election" and, together with the Deferred Income
               Deferral Elections, the "Deferral Elections") with the Committee
               before the beginning of the Specified Year, in accordance with
               Section 4 below, to have the Participant Elected Contributions
               and Employer Matching Contributions described in Section
               3.1(c)(ii) above, if any, credited to his Account.

          (ii) If such a Participant has a McCAP Deferral Election in
               effect for a calendar year, the McCAP Deferral Election and the
               Participant's elected deferrals under the 401(k) Feature of the
               Profit Sharing Plan may not be changed during the year. If such a
               Participant does not have a McCAP Deferral Election in effect for
               the calendar year, any amounts of Participant Elected
               Contributions in excess of the Elective Contribution Limit that
               are elected by the Participant under the 401(k) Feature of the
               Profit Sharing Plan either shall not be contributed or shall be
               returned to him or her as provided thereunder and no benefit
               shall be credited to him or her hereunder with respect to his or
               her Participant Elected Contributions and Employer Matching
               Contributions under the Profit Sharing Plan.

           3.2 Equalization. Base salary and compensation payable under the
               Annual Bonus Plan that are deferred under the Deferred Income
               Feature of the Plan shall be considered compensation for the
               McCAP Feature of the Plan, including, without limitation, for
               purposes of elections to contribute a percentage of compensation
               as Section 401(k) contributions. Three-Year Incentive awards that
               are deferred under the Deferred Income Feature of the Plan shall
               not be considered compensation for the McCAP Feature of the Plan.

Section 4 Rules for Deferral Elections
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4.1  Timing for Deferral Elections. All Deferral Elections must be returned
     to the Committee no later than the date specified by the Committee (the
     "Due Date"). In no event will the Due Date be later than the end of the
     year that precedes the year that the amount deferred would otherwise be
     made available to the Participant making the Deferral Election.

4.2  Tax Withholding and Other Special Rules. Notwithstanding any other
     provision of the Plan, if the Committee determines that it is necessary or
     appropriate for administrative, legal or other appropriate reasons, the
     Committee may decide not to apply any Deferral Election in whole or in
     part. Without limiting the generality of the foregoing, the Committee may
     decide not to apply a Deferral Election to the extent necessary or
     appropriate in order to comply with applicable laws regarding tax
     withholding, after application of Section 6.4 below.

Section 5 Accounts
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5.1  Accounts.

(a)  A bookkeeping account shall be established in each Participant's name
     (an "Account"). The Account of each individual who is a Participant in both
     the Deferred Income Feature and the McCAP Feature of the Plan shall be
     divided into two subaccounts, one representing the amounts credited to the
     Participant's Account pursuant to Section 2 above of the Plan, and the
     other representing the amounts credited to the Participant's Account
     pursuant to Section 3 above, in each case, as adjusted pursuant to Section
     5.2 below and as a result of distributions from the Account.

(b)  The Participants' Accounts may be further subdivided as the Committee
     may from time to time determine to be necessary or appropriate, including
     without limitation to reflect different sources of credits to the Accounts
     and different deemed investments thereof.

(c)  Amounts deferred pursuant to a Deferral Election shall be credited to
     the applicable Account as of the date the Participant would otherwise have
     received the deferred amounts in the absence of a Deferral Election. Any
     Equalization Amounts shall be credited to the applicable Account as soon as
     administratively feasible after the date when the amount of the
     corresponding employer contributions to the Profit Sharing Plan is
     determined. Any amount credited under the McCAP Feature of the Plan shall
     be credited to the applicable Account as of the date the amount would have
     been allocated under the Profit Sharing Plan if the Limits had not applied.
     Adjustments of a Participant's various subaccounts to reflect investment
     experience and distributions shall in all cases be done on a pro-rata
     basis, and such subaccounts shall be treated in the same manner for all
     other purposes of the Plan, except as specifically provided in Section 9.2
     below.

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                                                       McDonald's Corporation 45

5.2 Investment Elections and Earnings Credits.

     (a)  Each Participant in the Plan shall be permitted from time to time to
          make an investment election regarding the manner in which his or her
          Account shall be deemed invested. Subject to the following, the
          Committee shall establish and communicate to Participants the
          investment choices that will be available to Participants and the
          procedures for making and changing investment elections, as it may
          from time to time determine to be appropriate. Unless otherwise
          determined by the Committee, a Participant's investment election may
          be split among the available choices in increments of 1%, totaling
          100%. The procedures as in effect as of January 1, 2002 are attached
          as Exhibit D to the Plan.

     (b)  As of January 1, 2002, the available investment choices under the Plan
          are:

               (i)   a rate of return based upon the McDonald's Common Stock
                     Equivalent under the Profit Sharing Plan, after adjustment
                     for expenses under the Plan (the "Supplemental McDonald's
                     Common Stock Return");

               (ii)  a rate of return based upon the Stable Value Equivalent
                     under the Profit Sharing Plan, after adjustment for
                     expenses under the Plan (the "Supplemental Stable Value
                     Return"); and

               (iii) a rate of return based upon the S&P 500 Index Equivalent
                     under the Profit Sharing Plan, after adjustment for
                     expenses under the Plan (the "Supplemental S&P 500 Index
                     Return").

     (c)  For any period during which a Participant has failed to make an
          investment election, the Participant's Account shall be credited with
          the Supplemental Stable Value Return. A Participant's investment
          election will continue in effect until the Participant files a new
          investment election.

5.3  Vesting. A Participant shall be fully vested at all times in the balance of
     his or her Account, except as specifically provided in Section 6.3 below.

Section 6 Payment of Benefits
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6.1  Time and Method of Payment. Payments of a Participant's Account shall be
     made to a Participant, or the Participant's beneficiary if the Participant
     is deceased, in accordance with the rules set forth below:

     (a)  Time of Payment. Each payment under the Plan shall be made in a
          particular calendar month as provided below. The payments under the
          Plan that are to be made in a particular calendar month shall in all
          cases be made as soon as administratively feasible after the first
          business day of such calendar month.

     (b)  Default Rule and Participant Elections. Unless the Participant has
          elected otherwise as provided for below, payment of the Participant's
          Account shall be made in a single lump sum in April of the year
          following the year in which the Participant terminates employment.
          Participants shall be permitted to elect different times to receive
          payments ("Payment Elections") and forms of payment other than a lump
          sum ("Installment Elections"), subject to the rules set forth below.
          Any filing, change or revocation of a Payment Election that occurs
          after the applicable deadline set forth below shall be void and of no
          effect. In each case, the most recent such filing, change or
          revocation by a Participant on or before the applicable deadline shall
          govern the Participant's entire Account except as expressly provided
          below.

     (c)  Termination Distributions. Distributions from a Participant's Account
          after termination of employment (other than distributions made
          pursuant to Section 6.1(f) below) are referred to as "Termination
          Distributions." A Participant may elect to have his or her Termination
          Distributions paid, or begin to be paid in installments, later than
          April of the year following the year in which the Participant
          terminates employment. Such a Payment Election shall be made no later
          than December 31 of the year in which the Participant terminates
          employment.

     (d)  Installment Payments of Termination Distributions. A Participant may
          make an Installment Election selecting one of the following
          installment payment methods to apply to his or her Termination
          Distributions:

          (i)  Monthly, quarterly or annual installments over a period ending
               not later than the first April that begins after the 25th
               anniversary of the date of the Participant's termination of
               employment, as specified in the Installment Election. Such
               installment payments shall be made in substantially equal
               installments over the installment period specified. Each such
               installment payment shall be computed by dividing the
               then-balance of the Account by the number of payments remaining
               in the installment period.

          (ii) Monthly, quarterly or annual installments of a dollar amount
               specified in the Installment Payment Election; provided, however,
               that in any event, the last such installment must be paid not
               later than the first April that begins after the 25th anniversary
               of the date of the Participant's termination of employment.

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 46 McDonald's Corporation

          (iii) An initial partial lump sum payment with subsequent monthly,
                quarterly or annual installment payments, which shall be either
                (A) made over a period of years (as described in Section
                6.1(d)(i) above) or (B) of a specified dollar amount (as
                described in Section 6.1(d)(ii) above), as specified in the
                Installment Payment Election.

          An Installment Election shall be made on or before the December 31 of
          the calendar year preceding the date when the Participant's
          Termination Distributions are scheduled to begin, and, once made with
          respect to a Participant's Account, may not be revoked or changed by
          the Participant or the Participant's beneficiary, except to the extent
          permitted under Section 6.3 below.

     (e)  In-Service Withdrawals. A Participant may elect (an "In-Service
          Withdrawal Election") to have all or a specified portion of his or her
          Account paid in a specified month before termination of employment
          (such payments being called "In-Service Withdrawals"), subject to the
          following rules:

          (i)   such an election must be made before the Participant's
                termination of employment, and once made, shall be irrevocable;

          (ii)  the month so elected for an In-Service Withdrawal must (A)
                occur during a calendar year beginning subsequent to the date
                of the election and (B) begin at least six months after the
                date of the election; and

          (iii) the amount distributed in an In-Service Withdrawal may not
                include any amounts credited to the Participant's Account under
                Section 2 or Section 3 on or after January 1 of the year
                preceding the year in which the In-Service Withdrawal occurs,
                nor any earnings on such amounts.

     (f)  Termination Before In-Service Withdrawal. If the Participant's
          employment terminates at a time when one or more In-Service Withdrawal
          Elections are in effect, the In-Service Withdrawals shall continue to
          be paid in accordance with such elections, except that all In-Service
          Withdrawals that remain unpaid at the earlier of (i) the beginning of
          April of the year following the year in which the Participant
          terminates employment, and (ii) the date when the Participant's
          Termination Distributions are paid or begin to be paid, shall be
          treated as Termination Distributions and paid in accordance with
          Sections 6.1(a) through (d).

     (g)  Small Balance Rule. Notwithstanding any other provision of the Plan,
          and notwithstanding any election that the Participant may have made,
          if the balance in a Participant's Account as of the end of the month
          during which the Participant's employment terminates is less than
          $50,000, then such Participant's Account shall be paid in a single
          lump sum as soon as administratively feasible after the end of such
          month.

     (h)  Change in Control. The Committee may (but shall not be required to)
          establish procedures under which Participants may be permitted to
          elect to have all or a specified portion of their Accounts paid in a
          single lump sum upon a Change in Control, as that term is defined in
          the McDonald's Corporation 2001 Omnibus Stock Ownership Incentive
          Plan, notwithstanding any other provision of the Plan, and
          notwithstanding any other election that the Participant may have made.

6.2  Form of Payment. All payments shall be made in cash. However, a Participant
     who has elected a McDonald's Common Stock Equivalent return and who uses
     amounts that have been deemed so invested and then distributed in cash to
     purchase shares of McDonald's common stock on the open market in one or
     more transactions within seven months after the date such amounts were
     distributed, shall be entitled to receive reimbursement from the Company
     for all reasonable brokerage fees and other transaction costs incurred by
     him or her in connection with such purchases, upon presentation to the
     Committee not later than 60 days after the date of each transaction of
     satisfactory evidence thereof.

6.3  Hardship Withdrawals and Acceleration of Installment Payments. The Company
     recognizes that there will be circumstances in which a Participant will
     need to withdraw amounts from his or her Account more quickly than is
     permitted for In-Service Withdrawals under Section 6.1(e) above. Therefore,
     a Participant shall have the right to withdraw in cash any portion of the
     balance of his or her Account at any time before his or her termination of
     employment, subject to the Committee's consent and a 10% forfeiture penalty
     on the amount requested. A Participant who is receiving Termination
     Distributions in installments may also accelerate payment of any unpaid
     amount, subject to the Committee's consent and 10% forfeiture penalty on
     the amount accelerated. Any withdrawals or accelerated payments pursuant to
     this Section 6.3 (reduced by the 10% forfeiture penalty) shall be paid as
     soon as administratively feasible after the election to withdraw or
     accelerate payments is approved by the Committee.

6.4  Withholding of Taxes. The Company shall withhold any applicable Federal,
     state or local income tax from payments due under the Plan in accordance
     with such procedures as the Company may establish. Generally, any Social
     Security taxes, including the Medicare portion of such taxes, shall be
     withheld from other compensation to the Participant in question, or paid by
     the Participant in question to the Company, at the time amounts are
     credited to the Participant's Account. The Company shall also withhold any
     other employment taxes as necessary to comply with applicable laws.

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                                                       McDonald's Corporation 47

6.5 Beneficiary.

(a)  A Participant shall have the right to name a beneficiary or beneficiaries
     who shall receive the balance of a Participant's Account in the event of
     the Participant's death prior to the payment of his or her entire Account
     (a "Beneficiary Designation"). A beneficiary may be an individual, a trust
     or an entity that is tax-exempt under Code Section 501(c)(3). If no
     beneficiary is named by a Participant or if the Participant survives all of
     the named beneficiaries, the Participant's Account shall be paid to the
     Participant's estate. A Participant may change or revoke an existing
     Beneficiary Designation by filing another Beneficiary Designation with the
     Committee. The latest Beneficiary Designation received by the Committee
     shall be controlling.

(b)  A beneficiary designated by a Participant or another beneficiary who has
     not yet received payment of the entire benefit payable to him or her under
     the Plan shall have the right to name a beneficiary or beneficiaries to
     receive the balance of such benefit in the event of the beneficiary's death
     prior to the payment of the entire amount of such benefit, in accordance
     with Section 6.5(a) above, as if the beneficiary were a Participant
     (regardless of whether the Participant or such other beneficiary is still
     alive).

(c)  In addition, after the death of a Participant or a beneficiary thereof, any
     beneficiary designated by the Participant or such deceased beneficiary, as
     applicable, who has not yet received payment of the entire benefit payable
     to him or her under the Plan shall be treated for all purposes of Sections
     5 through 10 of the Plan in the same manner as the Participant with respect
     to the Account or portion thereof of which such person is the beneficiary,
     including, without limitation, for purposes of making investment elections,
     Payment Elections and Installment Elections.

Section 7 Miscellaneous
-------------------------------------------------------------------------------

7.1  Funding. Benefits payable under the Plan to any Participant shall be paid
     directly by the Company. The Company shall not be required to fund, or
     otherwise segregate assets to be used for payment of benefits under the
     Plan. While the Company may, in the discretion of the Committee, make
     investments (a) in shares of McDonald's Common Stock through open market
     purchases or (b) in other investments in amounts equal or unequal to
     amounts payable hereunder, the Company shall not be under any obligation to
     make such investments and any such investment shall remain an asset of the
     Company subject to the claims of its general creditors. Notwithstanding the
     foregoing, the Company may maintain one or more trusts (each, a "Trust") to
     hold assets to be used for payment of benefits under the Plan. Any payments
     by a Trust of benefits provided to a Participant under the Plan shall be
     considered payment by the Company and shall discharge the Company of any
     further liability under the Plan for such payments.

7.2  Account Statements. The Company shall provide Participants with statements
     of the balances of their Accounts under the Plan at least annually.

7.3  Employment Rights. Establishment of the Plan shall not be construed to give
     any employee or Participant the right to be retained in the Company's
     service or that of its subsidiaries and affiliates, or to any benefits not
     specifically provided by the Plan.

7.4  Interests Not Transferable. Except as to withholding of any tax under the
     laws of the United States or any state or locality and the provisions of
     Section 6.5 above, no benefit payable at any time under the Plan shall be
     subject in any manner to alienation, sale, transfer, assignment, pledge,
     attachment, or other legal process, or encumbrance of any kind. Any attempt
     to alienate, sell, transfer, assign, pledge or otherwise encumber any such
     benefits, whether currently or thereafter payable, shall be void. No person
     shall, in any manner, be liable for or subject to the debts or liabilities
     of any person entitled to such benefits. If any person shall attempt to, or
     shall alienate, sell, transfer, assign, pledge or otherwise encumber
     benefits under the Plan, or if by any reason of the Participant's
     bankruptcy or other event happening at any time, such benefits would
     devolve upon any other person or would not be enjoyed by the person
     entitled thereto under the Plan, then the Company, in its discretion, may
     terminate the interest in any such benefits of the person entitled thereto
     under the Plan and hold or apply them to or for the benefit of such person
     entitled thereto under the Plan or such individual's spouse, children or
     other dependents, or any of them, in such manner as the Company may deem
     proper.

7.5  Forfeitures and Unclaimed Amounts. Unclaimed amounts shall consist of the
     amount of the Account of a Participant that cannot be distributed because
     of the Committee's inability, after a reasonable search, to locate a
     Participant or the Participant's beneficiary, as applicable, within a
     period of two years after the Payment Date upon which the payment of
     benefits become due. Unclaimed amounts shall be forfeited at the end of
     such two-

<PAGE>

48 McDonald's Corporation

     year period. Penalties charged for withdrawals under Section 6.3 shall also
     be forfeited in the year in which the penalty is charged. These forfeitures
     will reduce the obligations of the Company under the Plan. After an
     unclaimed amount has been forfeited, the Participant or beneficiary, as
     applicable, shall have no further right to the Participant's Account.

7.6  Controlling Law. The law of Illinois, except its law with respect to choice
     of law, shall be controlling in all matters relating to the Plan to the
     extent not preempted by the Employee Retirement Income Security Act of
     1974, as amended ("ERISA").

7.7  Action by the Company. Except as otherwise specifically provided in the
     Plan, any action required of or permitted by the Company under the Plan
     shall be by resolution of the Board of Directors of the Company or by
     action of any member of the Committee or person(s) authorized by resolution
     of the Board of Directors of the Company.

7.8  Section 16. Notwithstanding any other provision of the Plan, the
     Compensation Committee may impose such restrictions, rules and regulations
     on the terms and conditions of participation in the Plan by any Participant
     who has been deemed by the Board of Directors of the Company to be subject
     to Section 16 of the Securities Exchange Act of 1934, as amended, as the
     Compensation Committee may determine to be necessary or appropriate. Any
     transaction that would result in liability or potential liability under
     said Section 16 shall be void ab initio.

Section 8 Subsidiary Participation
-------------------------------------------------------------------------------

8.1  Adoption of Plan. Any entity in which the Company directly or through
     intervening subsidiaries owns 25% or more of the total combined voting
     power or value of all classes of stock, or, in the case of an
     unincorporated entity, a 25% or more interest in the capital and profits (a
     "Subsidiary") may, with the approval of the Compensation Committee and
     under such terms and conditions as the Compensation Committee may
     prescribe, adopt the corresponding portions of the Plan by resolution of
     its board of directors and thereby become an "Adopting Subsidiary," except
     that the Brands shall automatically be considered Adopting Subsidiaries.
     The Compensation Committee may amend the Plan as necessary or desirable to
     reflect the adoption of the Plan by an Adopting Subsidiary, provided,
     however, that an Adopting Subsidiary shall not have the authority to amend
     or terminate the Plan under Section 9 below.

8.2  Withdrawal from the Plan by Subsidiary. Any Adopting Subsidiary shall have
     the right, at any time, upon the approval of and under such conditions as
     may be provided by the Compensation Committee, to withdraw from the Plan by
     delivering to the Compensation Committee written notice of its election so
     to withdraw, upon which it shall be considered a "Withdrawing Subsidiary."
     Upon receipt of such notice, the Compensation Committee may (but need not)
     determine that notwithstanding any other provision of this Plan and without
     regard to any Payment Elections made by the affected Participants, the
     Company shall pay out the portion of the Accounts of Participants and
     beneficiaries attributable to credits made while the Participants were
     employees of such Withdrawing Subsidiary, plus any net earnings, gains and
     losses on such credits.

8.3  Special Rule for Sales or Other Dispositions of Subsidiaries.
     Notwithstanding any other provision of the Plan, if an Adopting Subsidiary
     ceases to be a Subsidiary (thereby becoming a "Disaffiliated Subsidiary")
     as a result of (a) a sale, spinoff, public offering or other transaction
     involving the Disaffiliated Subsidiary, or if one or more businesses
     conducted by an Adopting Subsidiary are sold to another entity (a "Buyer"),
     any Participant who as a result of such transaction ceases to be employed
     by the Company or one of its remaining Subsidiaries shall be considered to
     have experienced a termination of employment for purposes of the Plan,
     unless the next sentence applies. If in connection with such a transaction,
     a Participant remains an employee of the Disaffiliated Subsidiary or
     becomes an employee of the Buyer or one of its subsidiaries or affiliates,
     as applicable, and the Disaffiliated Subsidiary or the Buyer, as
     applicable, assumes all liabilities to the Participant under this Plan,
     then the Participant shall not be considered to have experienced a
     termination of employment for purposes of the Plan, but the Company and its
     remaining Subsidiaries and affiliates shall have no further obligations to
     the Participant or any of his or her beneficiaries under the Plan.

<PAGE>

                                                       McDonald's Corporation 49

Section 9 Amendment and Termination; ERISA Issues
-------------------------------------------------------------------------------

9.1  Amendment and Termination. The Company intends the Plan to be
     permanent, but reserves the right at any time by action of its Board of
     Directors of the Company or the Compensation Committee to modify, amend or
     terminate the Plan; provided, however, that any amendment or termination of
     the Plan shall not reduce or eliminate any Account accrued through the date
     of such amendment or termination; and provided, further, that no such
     amendment made after a Change in Control or in contemplation of a Change in
     Control may eliminate any of the Participants' choices as to the timing and
     method of payments of Accounts under Section 6 with respect to amounts
     credited to Accounts before the date of the Change in Control. The
     Compensation Committee shall provide notice of amendments adopted by the
     Compensation Committee to the Board of Directors of the Company on a
     timely basis.

9.2  ERISA Issues. It is the intention of the Company that the Plan be
     viewed, for purposes of ERISA, as comprising three distinct plans (each, a
     "Subplan"), each of which is unfunded within the meaning of ERISA and
     therefore exempt from the reporting, disclosure and fiduciary rules of
     ERISA: (a) an "excess benefit plan" as defined in Section 3(36) of ERISA,
     covering Participants whose Accounts contain only amounts credited pursuant
     to Section 3.1(a) of the Plan; (b) a plan described in Sections 201(2),
     301(a)(3) and 401(a)(1) of ERISA (a "Top Hat Plan") covering Participants
     not described in the preceding clause (a) but whose Accounts contain only
     amounts credited under the McCAP Feature of the Plan; and (c) a Top Hat
     Plan covering Participants whose Accounts contain amounts credited under
     the Deferred Income Feature of the Plan. Without limiting the generality of
     the foregoing provisions of this Section 9, the Company reserves the right
     to terminate any Subplan, and to pay out the Accounts of Participants under
     the Subplan in connection with such termination, without regard to any
     Payment Elections made by such Participants, if it is determined by any
     competent authority, or by the Company with the advice of counsel, that
     such Subplan does not qualify as an excess benefit plan or Top Hat Plan.

Section 10 Committee Actions and Electronic Elections
-------------------------------------------------------------------------------

10.1 Actions of Committees. Any actions by the Committee or the Compensation
     Committee shall be taken upon the approval of a majority of the members
     thereof at any in-person or telephonic meeting or in writing.

10.2 Electronic Elections. Anything in the Plan to the contrary notwithstanding,
     the Committee may in its discretion may make disclosure or give information
     to Participants and beneficiaries and permit Participants or their
     beneficiaries to make electronic elections in lieu of written disclosure,
     information or elections provided in the Plan. In making such a
     determination, the Committee shall consider the availability of electronic
     disclosure of information and elections to Participants and beneficiaries,
     the protection of the rights of Participants and their beneficiaries, the
     appropriateness of the standards for authentication of identity and other
     security considerations involved in the electronic election system and any
     guidance issued by any relevant governmental authorities.

Executed in multiple originals this 1st day of October, 2001.

                                     McDONALD'S CORPORATION

                                     By:  /s/ Stanley R. Stein
                                        ---------------------------------------
                                     Name:  Stanley R. Stein
                                     Title: Executive Vice President

<PAGE>

50 McDonald's Corporation

EXHIBIT A Index of Defined Terms
-------------------------------------------------------------------------------
Defined Term                                                Section
Account                                                     5.1(a)
Adopting Subsidiary                                         8.1
Annual Bonus Plan                                           2.2(a)
Beneficiary Designation                                     6.5(a)
Brands                                                      Exhibit C
Buyer                                                       8.3
Change in Control                                           6.1(h)
Code                                                        1.2(b)
Company                                                     1.1(a)
Committee                                                   1.3
Compensation Committee                                      1.3
Compensation Limit                                          1.2(b)
Deferral Elections                                          3.1(d)(i)
Deferred Income Deferred Election                           2.2(a)
Deferred Income Eligible Employees                          2.1
Deferred Income Feature                                     1.2(a)
DIP                                                         1.1(a)
Disaffiliated Subsidiary                                    8.3
Due Date                                                    4.1
Elective Contribution Limit                                 1.2(a)
ERISA                                                       7.6
415 Limits                                                  1.2(b)
In-Service Withdrawal Election                              6.1(e)
In-Service Withdrawals                                      6.1(e)
Installment Elections                                       6.1(b)
Limits                                                      1.2(b)
Merger Document                                             1.1(a)
McDonald's                                                  1.1(a)
McCap I                                                     1.1(a)
McCap II                                                    1.1(a)
McCap Deferral Election                                     3.1(d)(i)
McCap Feature                                               1.2(a)
McEqual                                                     1.1(a)
Other Limits                                                1.2(b)
Participants                                                1.2(a)
Payment Elections                                           6.1(b)
Plan                                                        1.1(a)
Prior Year                                                  3.1(c)(i)
Profit Sharing Plan                                         1.2(a)
Specified Compensation                                      3.1(c)(i)
Specified Year                                              3.1(c)(i)
Subplan                                                     9.2
Subsidiary                                                  8.1
Supplemental McDonald's Common Stock Return                 5.2(b)(i)
Supplemental S&P 500 Index Return                           5.2(b)(iii)
Supplemental Stable Value Return                            5.2(b)(ii)
Termination Distributions                                   6.1(c)
Top Hat Plan                                                9.2(b)
Trust                                                       7.1
Withdrawing Subsidiary                                      8.2

<PAGE>

                                                       McDonald's Corporation 51

EXHIBIT B Merger Document
-------------------------------------------------------------------------------

(a)  WHEREAS, McDonald's Corporation (the "Company") has established and
     maintained the following four non-qualified deferred compensation plans
     (collectively, the "Plans"): the McDonald's Profit Sharing Program
     Equalization Plan as amended and restated effective January 1, 1996
     ("McEqual"); the McDonald's 1989 Executive Equalization Plan as amended and
     restated effective January 1, 1996 ("McCAP I"); the McDonald's Supplemental
     Employee Benefit Equalization Plan as amended and restated effective
     January 1, 1996 ("McCAP II"); and the McDonald's Corporation Deferred
     Income Plan (the "DIP"); and

(b)  WHEREAS, the Board of Directors of the Company has approved the merger of
     McEqual, McCAP I and McCAP II into the DIP, and the amendment and
     restatement of the DIP under the new name of the McDonald's Corporation
     Supplemental Profit Sharing and Savings Plan (the "Combined Plan"), all as
     more fully set forth below;

(c)  NOW, THEREFORE, the following actions are hereby approved, effective as of
     September 1, 2001:

 1.  The Combined Plan is hereby adopted substantially in the form presented to
     the Board. Capitalized terms used and not defined herein shall have the
     meanings given them in the Plans or in the Combined Plan, as applicable.

 2.  Each Participant in any of the Plans whose combined account balances under
     the Plans equals $5,000 or less as of September 1, 2001 and either (i) has
     terminated employment before September 1, 2001 or (ii) has 2001
     Compensation (as defined below) of not more than $85,000, and each
     beneficiary of such a Participant, shall be paid the entire balance in all
     of his or her accounts under the Plans in a single lump sum payment not
     later than December 31, 2001, and shall have no further rights under the
     Plans. For these purposes the term "2001 Compensation" shall mean the sum
     of (A) the amount of the Participant's annual base salary at the rate in
     effect for one of the payroll periods during August of the Prior Year, as
     specified by the Committee, and (B) the amount of the bonus, if any,
     payable to the Participant under the McDonald's Target Incentive Plan
     during 2001 (in each case without regard to any elective deferrals thereof
     under the Plans, the Profit Sharing Plan or otherwise).

 3.  Each Participant in and each beneficiary under McEqual, McCAP I or McCAP II
     whose account balances under those Plans are not paid out pursuant to
     Section 2 above shall automatically become a Participant in or a
     beneficiary under the McCAP Feature of the Combined Plan, as applicable,
     and his or her McEqual Account, McCAP I Account and/or McCAP II Account, as
     applicable, shall be included in his or her Account under the Combined
     Plan.

 4.  Each Participant in and each beneficiary under the DIP whose Deferral
     Account under the DIP is not paid out pursuant to Section 2 above shall
     automatically become a Participant in or a beneficiary under the Deferred
     Income Feature of the Combined Plan, as applicable, and his or her Deferral
     Account shall be included in his or her Account under the Combined Plan.

 5.  Each Participant in any of the Plans whose employment has terminated on or
     before December 31, 2001, but whose account balances under the Plans are
     not paid out pursuant to Section 2 above, and each beneficiary of such a
     Participant, shall be paid the entire balance in his or her Accounts under
     the Combined Plan in a single lump sum payment in March of 2002, unless he
     or she has previously elected a later payment date under Section 6.1(c) of
     the Combined Plan or made an Installment Election under Section 6.1(d) of
     the Combined Plan, in accordance with the rules set forth in the Combined
     Plan; provided, that the due date for either such election shall be
     December 15, 2001.

 6.  Effective as of January 1, 2002, except as specifically provided in Section
     5 above, the provisions of Section 6 of the Combined Plan relating to the
     time and method of payments of Accounts shall apply to the initial balances
     of Participants' Accounts under the Combined Plan that are carried over
     from accounts under the Plans (the "Prior Accounts") as provided in
     Sections 4 and 5 above (such initial balances, the "Initial Combined
     Accounts"), superseding all prior elections made under the Plans (including
     without limitation Delinking Elections under the Prior Plans) and all rules
     regarding the time and method of payments under the Plans as previously in
     effect.

<PAGE>

52 McDonald's Corporation

7.   The Initial Combined Accounts shall be deemed invested, as of January 1,
     2002, based upon how the corresponding account or accounts in the Plans
     were invested immediately as of December 31, 2001, as follows: (a) the
     portion of the Initial Combined Accounts that were invested in the Stable
     Value or Money Market Equivalents shall be deemed invested in the
     Supplemental Stable Value Return under the Combined Plan; (b) the portion
     of the Initial Combined Accounts that were invested in the International
     Stock, Diversified Stock, S&P 500 or Blended Stock and Bond Equivalents
     shall be deemed invested in the Supplemental S&P 500 Return under the
     Combined Plan; and (c) the portion of the Initial Combined Accounts that
     were invested in the McDonald's Common Stock Equivalent shall be deemed
     invested in the Supplemental McDonald's Common Stock Return under the
     Combined Plan.

8.   Any beneficiary designation that is in effect with respect to a Prior
     Account as of December 31, 2001 (a "Prior Designation") shall apply as of
     January 1, 2002 to the corresponding portion of the corresponding Initial
     Combined Account in which such Prior Account is included, subject to any
     subsequent beneficiary designations that may be made after January 1, 2002
     by the applicable Participant or beneficiary under the terms of the
     Combined Plan; provided, that the Committee may determine that in any
     event, all Prior Designations shall cease to be effective as to Accounts
     under the Combined Plan, upon reasonable advance notice to the individuals
     who made such Prior Designations.

9.   As soon as practicable after the date hereof, The McDonald's Profit Sharing
     Program Equalization Trust, The McDonald's 1989 Executive Equalization
     Trust, and The McDonald's Supplemental Employee Benefit Equalization Trust
     shall be merged into a single trust, subject to the agreement of the
     trustee of each such trust and the execution of a new trust agreement. Such
     new trust agreement shall require full funding of the trust in connection
     with a Change in Control as defined in the Combined Plan.

10.  All actions and determinations that are necessary or appropriate to
     implement the foregoing shall be taken by the Committee, as defined in the
     Combined Plan, or its delegee.

Executed in multiple originals this 1st day of October, 2001.

                                           McDONALD'S CORPORATION

                                           /s/ Stanley R. Stein
                                           ------------------------------------
                                           By:    Stanley R. Stein
                                           Title: Executive Vice President

<PAGE>

                                                       McDonald's Corporation 53

EXHIBIT C Brand Employees Who Are Deferred Income Eligible Employees
-------------------------------------------------------------------------------

The "Brands" means Chipotle, Boston Market, Donatos and their respective
subsidiaries.

The Deferred Income Eligible Employees of the Brands and McDonald's Corporation
are as follows:

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------
Maximum Salary Deferral %  McDonald's                Boston Market     Donatos               Chipotle
================================================================================================================
<S>                        <C>                       <C>               <C>                   <C>
60%                        Senior Direction Band     Officers          Vice President        Band C - Executives

70%                        Leadership & Sr.          Leadership Team   Sr. Vice President,   Band B - Officers/
                           Leadership Bands                            CFO, CEO, COO         Vice Presidents

80%                        Executive Management      N/A               N/A                   Band A - CEO
                           Band

90%                        5 Highest Paid Officers   N/A               N/A                   N/A
                           of McDonald's
----------------------------------------------------------------------------------------------------------------
</TABLE>

EXHIBIT D Procedures for Investment Elections
-------------------------------------------------------------------------------

[Attached]<PAGE>

                                                                     Exhibit 10g

                            EXECUTIVE RETENTION PLAN
                            ------------------------
                    (as amended and restated March 20, 2002)

          McDonald's Corporation, a Delaware corporation (the "Company"), hereby
establishes the Executive Retention Plan (the "Plan") effective as of October 1,
1998 (the "Effective Date"). The Plan was amended and restated on March 20, 2001
and March 20, 2002.

                                    Article 1

                                     Purpose

          It is in the best interests of the Company and its shareholders to
assure that the Company has the continued dedication of its key executives in a
highly competitive global marketplace. This Plan is established to promote the
retention of these key executives and provide the Company with a smooth
succession process. This Plan is also intended to provide these key executives
with incentives that are designed to focus their energy on contributing to the
ultimate success of the Company.

                                    Article 2

                               Plan Administration

          2.01 The Committee. The Compensation Committee of the Board of
               -------------
Directors of the Company, as constituted from time to time (the "Committee"),
shall have overall responsibility for the establishment, amendment,
administration and operation of the Plan. The Committee may elect to delegate
certain of such responsibilities to one or more of its members and, in such
case, all references in this Plan to the "Committee" shall include a reference
to one or more of the Committee members to whom any such responsibilities have
been delegated. This Plan shall be administered in a uniform and
nondiscriminatory manner by the Committee, which shall have the responsibilities
and duties and powers under this Plan which are not specifically delegated to
anyone else, including the following powers:

          (i)   subject to any limitations under this Plan or applicable law, to
          make and enforce such rules and regulations of this Plan and prescribe
          the use of such forms as it shall deem necessary for the efficient
          administration of this Plan;

          (ii)  to require any person to furnish such information as it may
          reasonably request as a condition to receiving any benefit under this
          Plan;

          (iii) to decide on questions concerning this Plan and the eligibility
          of the persons identified as "Tier I Executives" and "Tier II
          Executives" (collectively, the "Executives") on Appendix A to
          participate in this Plan, in accordance with the provisions of this
          Plan;

                                       1

<PAGE>

          (iv) to compute or cause to be computed the amount of benefits which
          shall be payable to any person in accordance with the provisions of
          this Plan; and

          (v)  to appoint and remove, as it deems advisable, the Plan
          Administrator.

          2.02 The Plan Administrator. The Committee may appoint a Plan
               ----------------------
Administrator who may (but need not) be a member of the Committee, and in the
absence of such appointment, the Committee shall be the Plan Administrator. The
Plan Administrator shall perform the administrative responsibilities delegated
to the Plan Administrator from time to time by the Committee.

          2.03 Discretionary Power of the Committee. The Committee from time to
               ------------------------------------
time may establish rules for the administration of this Plan. The Committee
shall have the sole discretion to make decisions and take any action with
respect to questions arising in connection with this Plan, including the
construction and interpretation of this Plan and the determination of
eligibility for and the amount of benefits under this Plan. The decisions or
actions of the Committee as to any questions arising in connection with this
Plan, including the construction and interpretation of this Plan, shall be final
and binding upon all Executives and their respective beneficiaries.

          2.04 Action of the Committee. The Committee may act at a meeting,
               -----------------------
including a telephonic meeting, by the consent of a majority of the members of
the Committee at the time in office, or without a meeting, by the unanimous
written consent of the individual members of the Committee. An executed document
signed by an individual member of the Committee and transmitted by facsimile
shall be valid as the original signed document for all purposes. Any person
dealing with the Committee shall be entitled to rely upon a certificate of any
member of the Committee, or the Secretary or any Assistant Secretary of the
Company, as to any act or determination of the Committee.

          2.05 Advisors and Agents of the Committee. The Committee may, subject
               ------------------------------------
to periodic review, (a) authorize one or more of its members or an agent to
execute or deliver any instrument, and make any payment on its behalf and (b)
utilize the services of associates and engage accountants, agents, legal
counsel, record keepers, professional consultants (any of whom may also be
serving the Company) or authorized Company personnel to assist in the
administration of this Plan or to render advice with regard to any
responsibility or issue arising under this Plan.

          2.06 Records and Reports of the Committee. The Committee shall
               ------------------------------------
maintain records and accounts relating to the administration of this Plan. An
Executive shall be entitled to review any records relating to his or her
individual participation in the Plan and to make copies of such records upon
written request to the Committee.

          2.07 Liability of the Committee; Indemnification. The members of the
               -------------------------------------------
Committee and the Plan Administrator shall have no liability with respect to any
action or

                                       2

<PAGE>

omission made by them in good faith nor from any action or omission made in
reliance upon (a) the advice or opinion of any accountant, legal counsel,
medical adviser or other professional consultant or (b) any resolutions of the
Board (or the Committee) certified by the Secretary or Assistant Secretary of
the Company. Each member of the Committee and the Plan Administrator shall be
indemnified, defended and held harmless by the Company and its respective
successors against all claims, liabilities, fines and penalties and all expenses
(including reasonable attorneys' fees and disbursements and other professional
costs incurred in enforcing this provision) reasonably incurred by or imposed
upon such individual which arise as a result of his or her actions or failure to
act in connection with the operation and administration of this Plan, to the
extent lawfully allowable and to the extent that such claim, liability, fine,
penalty or expense is not paid for by liability insurance purchased by or paid
for by the Company or an affiliate thereof. Notwithstanding the foregoing, the
Company shall not indemnify any person for any such amount incurred through any
settlement or compromise of any action unless the Company consents in writing to
such settlement or compromise, which consent shall not be unreasonably withheld.

          2.08 Plan Expenses. Expenses relating to this Plan prior to its
               -------------
termination shall be paid from the general assets of the Company. To the extent
required by applicable law, the Company may require any member of the Committee
to furnish a fidelity bond satisfactory to the Company.

          2.09 Service in More than One Capacity. Any person or group of persons
               ---------------------------------
may serve this Plan in more than one capacity.

          2.10 Named Fiduciary. The named fiduciary of this Plan shall be the
               ---------------
Committee.

          2.11 Delegation of Responsibility. The Committee shall have the
               ----------------------------
authority to delegate from time to time, in writing, all or any part of its
responsibilities under this Plan to a member of the Committee. The Committee may
also delegate administrative functions to the Plan Administrator pursuant to
Section 2.02. The Committee may in the same manner revise or revoke any such
delegation of responsibility. Any action of the delegate in the exercise of such
delegated responsibilities shall have the same force and effect for all purposes
hereunder as if such action had been taken by the Committee. The Committee shall
not be liable for any acts or omissions of any such delegate. The delegate shall
periodically report to the Committee concerning the discharge of the delegated
responsibilities.

          2.12 Allocations of Responsibility. The Committee shall have the
               -----------------------------
authority to allocate from time to time, in writing, all or any part of its
responsibilities under this Plan to one or more of its members as it may deem
advisable, and in the same manner to revoke such allocation of responsibilities.
Any action of the member to whom responsibilities are allocated in the exercise
of such allocated responsibilities shall have the same force and effect for all
purposes hereunder as if such action had been taken by the allocating authority.
The Committee shall not be liable for any acts or omissions of such member. The
member to whom responsibilities have been allocated shall periodically report to
the Committee concerning the discharge of the allocated responsibilities.

                                       3

<PAGE>

          2.13 Filing a Claim. Each individual eligible for benefits under this
               --------------
Plan ("Claimant") may submit a claim for benefits ("Claim") to the Plan
Administrator in writing on a form provided or approved by the Plan
Administrator or, if no such form has been so provided or approved, on any form
that specifies, in reasonable detail, facts and circumstances and the applicable
Plan provisions which the Claimant believes entitle him or her to compensation
or benefits under this Plan. A Claimant shall have no right to seek review of a
denial of benefits, or to bring any action in any court to enforce a Claim,
prior to his filing a Claim and exhausting his or her rights to review under
this Article 2.

          When a Claim has been filed properly, it shall be evaluated and the
Claimant shall be notified of the approval or the denial of the Claim within 45
days after the receipt of such Claim unless special circumstances require an
extension of time for processing the Claim. If such an extension is required,
written notice of the extension shall be furnished to the Claimant prior to the
end of the initial 45-day period, which notice shall specify the special
circumstances requiring an extension and the date by which a final decision will
be reached (which date shall not be later than 90 days after the date on which
the Claim was filed). A Claimant shall be given a written notice in which the
Claimant shall be advised as to whether the Claim is granted or denied, in whole
or in part. If a Claim is denied, in whole or in part, the notice shall contain
(a) the specific reasons for the denial, (b) references to pertinent Plan
provisions upon which the denial is based, (c) a description of any additional
material or information necessary to perfect the Claim and an explanation of why
such material or information is necessary, and (d) the Claimant's right to seek
review of the denial.

          2.14 Review of Claim Denial. If a Claim is denied, in whole or in
               ----------------------
part, the Claimant shall have the right to (a) request a review of the denial by
the Committee or its delegate, (b) review pertinent documents (c) submit issues
and comments in writing to the Committee and (d) appear before the Committee in
person to present such issues and comments; provided that the Claimant files a
written request for review with the Committee within 60 days after the
Claimant's receipt of written notice of the denial. Within 60 days after the
Committee receives a request for review, the review shall be made and the
Claimant shall be advised in writing of the decision on review, unless special
circumstances require an extension of time for such review, in which case the
Claimant shall be given a written notice within such initial 60-day period
specifying the reasons for the extension and when such review shall be
completed; provided that such review shall be completed within 120 days after
the filing of the request for review. The Committee's decision on review shall
be sent to the Claimant in writing and shall include (a) specific reasons for
the decision and (b) references to Plan provisions upon which the decision is
based. A decision on review shall be binding on all persons for all purposes.

          If a Claimant shall fail to file a request for review in accordance
with the procedures herein outlined, such Claimant shall have no right to obtain
such a review or to bring an action in any court, and the denial of the Claim
shall become final and binding on all persons for all purposes except upon a
showing of good cause for such failure.

                                        4

<PAGE>

                                    Article 3

                                Retention Period

          As a condition of receiving the Transition Benefits (as defined in
Section 4.02) and the Continued Employment Benefits (as defined in Section
5.02), an Executive must provide services to the Company as an Executive Officer
(as defined below) throughout the Retention Period. During the Retention Period,
(i) an Executive's employment shall be on an at-will basis and (ii) the
Executive shall be entitled to participate in the Company's benefits and
compensation plans, practices, policies and programs as in effect from time to
time.

          For purposes of this Plan:

               (a) an Executive's "Retention Period" shall mean the period
               commencing on the Executive's Start Date (as specified on
               Appendix A) and ending five years thereafter (in the case of Jack
               Greenberg) or three years thereafter (in the case of all other
               Executives); and

               (b) "Executive Officer" means an executive officer (as defined by
               Rule 3b-7 (or any successor rule) under the Securities Exchange
               Act of 1934 as in effect from time to time) of the Company.

                                    Article 4

                                Transition Period

          4.01 Election to Become a Transition Officer. Upon an Executive's
               ---------------------------------------
completion of his or her Retention Period, such Executive may elect by written
notice (accompanied by a fully executed Release (as described in Section
8.01(i)) and Noncompetition Agreement (as defined in Section 9.01) (such notice,
Release and Noncompetition Agreement collectively referred to herein as the
"Transition Documents") to the Committee to become an officer of the Company who
is not an Executive Officer (such non-Executive Officer, a "Transition Officer),
provided that, in the case of a Tier II Executive (i) a successor has been
selected by the Company and has been approved by the Chief Executive Officer of
the Company (the "CEO") in such CEO's sole discretion, or (ii) such Tier II
Executive has attained age 62. Such election shall become effective upon the
Change-in-Status Date (as defined below) and the Executive shall thereafter
serve as a Transition Officer during a number of months (the "Transition
Period") equal to the lesser of (i) the number of the Executive's Years of
Service (as defined below), or (ii) 18 months. During the Transition Period, an
Executive's employment shall be on an at-will basis and subject to the
termination provisions set forth in Articles 6 and 7.

          For purposes of this Plan:

                                        5

<PAGE>

               (a) an Executive's "Change-in-Status Date" shall mean the date
               specified in the Executive's Transition Documents, provided that
               the Committee may accelerate such date in its sole discretion;
               and

               (b) an Executive's "Years of Service" shall equal the number of
               consecutive complete 12-month intervals during the period
               beginning on the earlier of the Executive's historical service
               date or company service date and ending on the Change-in-Status
               Date rounded down to the nearest complete 12-month interval
               (e.g., a period of 10 years, 8 months and 3 days shall equal 10
               "years of service").

          4.02 Transition Benefits. (a) Base Salary. During the Transition
               -------------------
Period, the Company shall pay an Executive a base salary at the annualized rate
in effect on the day immediately preceding the Change-in-Status Date but in no
event lower than the highest base salary in effect at any time between the
Effective Date and the Change-in-Status Date, provided that the base salary
payable under this Section shall be reduced to reflect any across-the-board
reductions implemented by the Committee prior to the Change-in-Status Date which
reductions affect Company officers generally (the "Annual Base Salary"). The
Annual Base Salary shall also be reduced to the extent that the Executive elects
to defer or reduce such salary under the terms of any deferred compensation plan
or other employee benefit plan or arrangement maintained or established by the
Company.

               (b) Annual Bonus. In respect of each calendar year which ends
during the Transition Period, the Company shall pay to the Executive an Annual
Bonus (as defined below), which bonus shall be payable in a lump sum on April
1st of the year following the year in which it was earned (or such other date,
as determined by the Committee in accordance with the Company's Target Incentive
Program or any successor plan ("TIP")). In respect of any calendar year in which
the Transition Period ends, the Company shall pay to the Executive (in lieu of
an Annual Bonus) a Prorated Annual Bonus (as defined below), which Prorated
Bonus shall be payable in a lump sum within 60 days after the end of the
Transition Period.

          Notwithstanding the foregoing, the Annual Bonus shall be reduced to
the extent that the Executive previously elected to defer or reduce such bonus
under the terms of any deferred compensation plan or other employee benefit plan
or arrangement maintained or established by the Company. The Executive shall not
be entitled to defer any portion of the Prorated Bonus.

          For purposes of this Plan,

               (i) "Annual Bonus" shall mean an annual bonus pursuant to TIP
               which is equal to the product of the Annual Base Salary and the
               Full Target Percentage (as defined below);

               (ii) "Full Target Percentage" shall mean the target percentage
               which the Executive was eligible to receive under TIP on the day
               immediately

                                        6

<PAGE>

               preceding the Change-in-Status Date without any adjustment, but
               in no event lower than the Executive's highest target percentage
               in effect at any time between the Effective Date and the
               Change-in-Status Date, provided that the target percentage shall
               be reduced to reflect any across-the-board reductions implemented
               by the Committee prior to the Change-in-Status Date which
               reductions affect Company officers generally, and

               (iii) "Prorated Annual Bonus" shall mean a bonus in an amount
               equal to the Annual Bonus multiplied by a fraction, the numerator
               of which is the number of days which have elapsed during such
               calendar year through the last day of the Transition Period, and
               the denominator of which is 365.

               (c) Three-Year Incentive Plan Awards. During the Transition
Period, any outstanding awards under the Company's Three-Year Incentive Plan or
any successor plan ("LTIP") will continue to vest and become payable in
accordance with the Company's policies as in effect from time to time. Such LTIP
awards ("LTIP Awards") shall be computed by reference to 100% of the target
percentage the Executive would have received pursuant to the terms of the
original LTIP grant without any adjustment. During the Transition Period, the
Executive shall not be eligible to participate in any new cycles under LTIP or
other long-term incentive plan.

               (d) Continued Vesting and Exercisability of Stock Options. During
the Transition Period, stock options will continue to vest, expire and otherwise
be subject to the express terms of the related stock option plan and the
applicable Golden M Certificate (or other applicable award agreement). During
the Transition Period, an Executive shall retain the right to exercise any
unexercised stock option to the extent vested on the date of exercise, provided,
however, that an Executive shall not be entitled to receive any additional stock
option grants and in no event shall the term of any stock option extend beyond
its original term.

               (e) Benefit Programs and Policies. During the Transition Period,
all benefit plans, policies, fringe benefits and practices in effect from time
to time shall continue to apply to the Executive in accordance with the terms of
the benefit plans sponsored by the Company and the Company's policies and
procedures established for officers of the Company who are not Executive
Officers, except that: (i) the Executive will not be eligible for any pay
increase, (ii) the Executive will not be eligible to participate in TIP during
any year if the Transition Period ends prior to the end of a calendar year,
(iii) no new stock option grants will be given to the Executive, and (iv) no new
awards will be granted under LTIP. Amounts paid during the Transition Period
shall be treated as "compensation" for purposes of determining any benefits
provided under McDonald's Corporation Profit Sharing Program and the related
non-qualified benefit plans known as McCAP I, McCAP II or McEQUAL, and
McDonald's Corporation Deferred Income Plan and life insurance benefit plans
sponsored by McDonald's Corporation (collectively, the "Benefit Plans") to the
extent permitted by the terms of such Benefit Plans as in effect from time to
time. Nothing in this Plan shall be construed to limit the ability of the
Company to amend or terminate any of the plans, programs or arrangements under
which benefits are provided to officers and employees of the Company, and any
such terminations or amendments shall be effective as to the Executives.

                                        7

<PAGE>

          4.03 Time Devoted to Duties During Transition Period. During the
               -----------------------------------------------
Transition Period, an Executive shall devote substantially all of his or her
normal business time and efforts to the business of the Company, its
subsidiaries and its affiliates, the amount of such time to be sufficient to
permit him or her to diligently and faithfully serve and endeavor to further its
interests to the best of his or her ability. Subject to the foregoing, an
Executive may participate in various civic and philanthropic activities, may
serve on boards of directors and committees of not-for-profit organizations of
the Executive's choice, and, consistent with the policies of the Company, may
serve as a non-employee director of one or more corporations (unless the
Committee concludes that such service would be inappropriate or not in the best
interests of the Company).

                                    Article 5

                           Continued Employment Period

          5.01 Employee Status. Following the Transition Period, the Executive
               ---------------
will become a staff employee of the Company for a five year "Continued
Employment Period", provided that the Executive complies with the Noncompetition
Agreement at all times during the term of the Continued Employment Period. As a
condition to receiving the Continued Employment Benefits (defined in Section
5.02), the Executive shall have executed and delivered to the Committee the
Release described in Section 8.01(ii). During the Continued Employment Period,
an Executive's employment shall be on an at-will basis and subject to the
termination provisions set forth in Articles 6 and 7.

          5.02 Continued Employment Benefits. (a) Base Salary. During the
               -----------------------------
Continued Employment Period, the Company shall pay the Executive a base salary
for each year equal to twenty-five percent (25%) of his or her Annual Base
Salary (fifty percent (50%) in the case of Jack M. Greenberg, and thirty-five
percent (35%) in the case of James R. Cantalupo) (the "Continued Employment
Period Salary"), provided, however, that the Continued Employment Period Salary
shall be reduced to the extent that the Executive elects to defer or reduce such
salary under the terms of any employee benefit plan or arrangement maintained or
established by the Company.

               (b) Target Incentive Awards. During the Continued Employment
Period, an Executive shall not be eligible to participate in TIP or any other
annual incentive plan of the Company.

               (c) LTIP Awards. During the Continued Employment Period, any
outstanding awards under LTIP will continue to vest and become payable in
accordance with the Company's then current policies notwithstanding the
Executive's staff employee status during this period. Such LTIP Awards shall be
computed by reference to 100% of the target percentage the Executive would have
received pursuant to the terms of the original LTIP grant without any
adjustment. During the Continued Employment Period, the Executive shall not be
eligible to participate in any new cycles under LTIP or other long-term
incentive plan.

                                        8

<PAGE>

               (d) Continued Vesting and Exercisability of Stock Options. During
the Continued Employment Period, stock options will continue to vest, expire and
otherwise be governed by the express terms of the related stock option plan and
the applicable Golden M Certificate (or other applicable award agreement).
During the Continued Employment Period, an Executive shall retain the right to
exercise any unexercised stock option to the extent vested on the date of
exercise, provided, however, that an Executive shall not be entitled to receive
any additional stock option grants and, in no event, shall the term of any stock
option extend beyond its original term.

               (e) Benefit Programs and Policies. During the Continued
Employment Period, all benefit plans, policies, fringe benefits and practices in
effect from time to time shall continue to apply to the Executive in accordance
with the terms of the benefit plans sponsored by McDonald's and McDonald's
policies and procedures established for staff employees of the Company, except
that: (i) the Executive will not be eligible for any pay increase, (ii) the
Executive will not be eligible to participate in the TIP, (iii) no new stock
option grants will be given to the Executive, and (iv) no new awards will be
granted under LTIP. Amounts paid during the Continued Employment Period shall be
treated as "compensation" for purposes of determining any benefits provided
under the Benefit Plans to the extent permitted by the terms of such Benefit
Plans as in effect from time to time. Nothing in this Plan shall be construed to
limit the ability of the Company to amend or terminate any of the plans,
programs or arrangements under which benefits are provided to officers or
employees of the Company, and any such terminations or amendments shall be
effective as to the Executives.

          5.03 Time Devoted to Duties During Continued Employment Period. During
               ---------------------------------------------------------
the Continued Employment Period, an Executive shall devote such time to the
business of the Company as may be reasonably requested by the Company from time
to time, which requests shall be commensurate with the compensation the
Executive is receiving hereunder. Notwithstanding the foregoing, an Executive
may participate in various civic and philanthropic activities, may serve on
boards of directors and committees of not-for-profit organizations of the
Executive's choice, may serve as a member of one or more corporate boards of
directors and may engage in a full-time employment arrangement with another
organization of the Executive's choice, provided that such activities do not
violate the Executive's obligations set forth in Article 9. The Company shall
have the right to request that the Executive provide services to the Company
during the Continued Employment Period in a manner that reasonably accommodates
such outside activities, services and arrangements.

          5.04 Mitigation. In the event that an Executive shall engage in any
               ----------
employment arrangement permitted by Section 5.03 (including self-employment)
during the Continued Employment Period, no amount paid to or earned by such
Executive therefrom shall reduce any payments or other benefits due such
Executive pursuant to the Plan.

                                        9

<PAGE>

                                    Article 6

                            Termination of Employment

          6.01 Death or Disability. An Executive's employment shall terminate
               -------------------
automatically upon his or her death. In the event that (a) the Committee
determines in good faith that the Executive is suffering from a "Disability"
(together with its various cognates, as defined below) and (b) the appropriate
decisionmaker under any applicable Company plan or program providing disability
benefits to the Executive (a "Disability Plan") similarly determines that the
Executive is eligible for such benefits by virtue of the Executive's disability
(as defined for purposes of such plan or program), the Company may deliver to
the Executive written notice (a "Disability Termination Notice") in accordance
with Section 6.05 of this Plan of the Company's intention to terminate the
Executive's employment. In such event, the Executive's employment shall
terminate effective on the later of (y) the 30th day after receipt of such
Disability Termination Notice by the Executive and (z) the first date on which
the Executive becomes eligible for long-term disability benefits under the
principal Disability Plan applicable to the Executive (the "Disability Effective
Date"), provided, however, that (1) in the interim the Executive shall not have
returned to full-time performance of the Executive's duties and/or (2) the
Executive shall not have delivered to the Committee within 30 days of receipt of
a Disability Termination Notice a written objection thereto (an "Objection"). In
the event of a timely Objection, any termination of the Executive shall be
suspended and the Executive shall be promptly examined by two physicians or
other professionals skilled in the relevant field, one selected by the Executive
and one by the Committee. Each of the two professionals shall issue a written
opinion within 15 days following the completion of his or her examination as to
whether the Executive is Disabled in accordance with the definition provided in
this Plan. If the two professionals agree, each of the Executive and the Company
shall be bound by their joint conclusion. If the two professionals disagree,
they shall jointly agree on a third professional to conduct a similar
examination. Each of the Executive and the Company shall be bound by the
conclusion of such third professional. The Executive agrees to each such
examination and to waive any confidentiality rights necessary to allow each of
the professionals conducting such examinations to do so. The Company shall pay
all fees and costs of all such examinations. In the event of a disagreement as
to the determination of the Executive's disability for purposes of a Disability
Plan, such disagreement shall be resolved as provided for in such Disability
Plan. For purposes of this Plan, the term "Disability" shall mean the material
inability of the Executive, due to injury, illness, disease or bodily, mental or
emotional infirmity, to carry out the job responsibilities which such Executive
held or the tasks to which such Executive was assigned at the time of the
incurrence of such Disability, which inability is reasonably expected to be
permanent or of indefinite duration exceeding one year.

          6.02 Cause. The Company may terminate an Executive's employment at any
               -----
time for Cause. For purposes of this Plan, "Cause" means: (i) the willful
failure of an Executive to perform substantially all of the Executive's duties
with the Company (other than any failure resulting from incapacity due to
physical or mental illness), after written demand for substantial performance is
delivered to the Executive by the Committee or the CEO; (ii) a willful violation

                                       10

<PAGE>

of McDonald's rules and policies as in effect from time to time; or (iii) the
commission of any act or acts involving dishonesty, fraud, illegality or moral
turpitude. For purposes of this provision, no act or failure to act, on the part
of the Executive, shall be considered "willful", unless it is done, or omitted
to be done, by the Executive in bad faith or without reasonable belief that the
Executive's action or omission was in the best interests of the Company. Any
act, or failure to act, based upon authority given pursuant to a resolution duly
adopted by the Board or upon the instructions of the CEO or an officer of the
Company senior in rank to the Executive to whom the Executive reports or based
upon the advice of counsel for the Company shall be conclusively presumed to be
done, or omitted to be done, by the Executive in good faith and in the best
interests of the Company. The cessation of employment of the Executive shall not
be deemed to be for Cause unless and until there shall have been delivered to
the Executive a copy of a resolution duly adopted by the affirmative vote of a
majority of the Board at a meeting of the Board called and held upon appropriate
notice (after reasonable notice is provided to the Executive and the Executive
is given an opportunity, together with counsel, to be heard before the Board),
finding that, in the good faith opinion of the Board, the Executive is guilty of
the conduct described in this paragraph, and specifying the particulars thereof
in detail.

          6.03 Good Reason. During the Retention Period and the Transition
               -----------
Period, a Tier I Executive may terminate his employment at any time for Good
Reason. For purposes of this Plan, "Good Reason" shall mean:

                    (i)  the assignment to the Executive of any duties
               inconsistent in any respect with the Executive's position
               (including status, offices, titles and reporting requirements),
               authority, duties or responsibilities as of the Effective Date,
               or any other action by the Company which results in a diminution
               in such position, authority, duties or responsibilities,
               excluding for this purpose an isolated, insubstantial and
               inadvertent action, provided that any change in status, duties
               and responsibilities resulting from a change in status from
               Executive Officer to Transition Officer pursuant to the
               provisions of this Plan shall not constitute Good Reason; or

                    (ii) the relocation of the Executive's principal place of
               employment to a location outside the greater Chicago metropolitan
               area.

Notwithstanding the foregoing, a Tier I Executive cannot terminate employment
for Good Reason (i) if the Executive consented in writing to the occurrence of
the event giving rise to the claim of Good Reason or (ii) unless the Executive
shall have delivered a written notice to the Committee within 30 days of his
having actual knowledge of the occurrence of such event stating that he intends
to terminate his employment for Good Reason and specifying the factual basis for
such termination, and such event is not cured within 30 days of the receipt of
such notice.

          6.04 Termination of Employment For Any Other Reason. The Company may
               ----------------------------------------------
terminate an Executive's employment at any time by written notice to the
Executive in accordance with Section 6.05 of this Agreement of its intention to
terminate the Executive's employment for any reason other than death, Disability
or Cause.

                                       11

<PAGE>

          6.05 Notice of Termination. Any termination by the Company other than
               ---------------------
for death, or by a Tier I Executive for Good Reason, shall be communicated by
Notice of Termination to the other party hereto given in accordance with this
Section 6.05. For purposes of this Plan, a "Notice of Termination" means a
written notice which (i) indicates the specific termination provision in this
Plan relied upon, (ii) to the extent applicable, sets forth in reasonable detail
the facts and circumstances claimed to provide a basis for termination of the
Executive's employment under the provision so indicated, and (iii) if the Date
of Termination (as defined in Section 6.06) is other than the date of receipt of
such notice, specifies the termination date (which date shall be not more than
30 days after the giving of such notice). The failure by the Executive or the
Company to set forth in the Notice of Termination any fact or circumstance which
contributes to a showing of Good Reason or Cause shall not waive any right of
the Executive or the Company, respectively, hereunder or preclude the Executive
or the Company, respectively, from asserting such fact or circumstance in
enforcing the Executive's or the Company's rights hereunder.

          6.06 Date of Termination. "Date of Termination" means (i) if the
               -------------------
Executive's employment is terminated by the Company other than for death or
Disability, or by the Tier I Executive for Good Reason, the date of receipt of
the Notice of Termination or any later date specified therein, as the case may
be, (ii) if the Executive's employment is terminated by death, the date of
death, and (iii) if the Executive's employment is terminated by reason of
Disability, the Disability Effective Date.

                                    Article 7

                   Obligations of the Company upon Termination

          7.01 By an Executive for Good Reason; By the Company Other Than for
               --------------------------------------------------------------
Cause, Death or Disability. If the Company terminates an Executive's employment
--------------------------
other than for Cause, death or Disability or if a Tier I Executive terminates
his employment for Good Reason,

                    (i)  the Company shall pay the following amounts
               (collectively, the "Termination Payment") to the Executive in a
               lump sum in cash within 60 days after the Date of Termination:

                         A. the Accrued Obligations (as defined below), and

                         B. the Severance Benefit (as defined below), and

                         C. the Welfare Benefit (as defined below); and

                    (ii) the Executive shall have the right to exercise the
               following categories of stock options as of his or her Date of
               Termination and for five years thereafter: (i) all options
               exercisable as of the Executive's Date of Termination, and (ii)
               all options that will become exercisable within

                                       12

<PAGE>

               five years following the Executive's Date of Termination
               (collectively, the "Exercisable Options"), provided that in no
               event shall any option be exercised more than ten years after the
               date of grant.

          For purposes of this Plan:

               (a) "Accrued Obligations" shall mean the sum of (1) any unpaid
               base salary accrued through the Date of Termination unless
               previously deferred by the Executive pursuant to the terms of an
               employee benefit plan or arrangement maintained by the Company
               ("Accrued Salary"), (2) any unpaid annual bonus amounts in
               respect of any calendar year ended before the Date of Termination
               (computed by reference to the Target Percentage (as defined
               below)) ("Earned Bonus"), unless previously deferred by the
               Executive pursuant to the terms of an employee benefit plan or
               arrangement maintained by the Company, (3) the product of (x) any
               annual bonus in respect of any incomplete calendar year (computed
               by reference to the Target Percentage and (y) a fraction, the
               numerator of which is the number of days in the current fiscal
               year through the Date of Termination, and the denominator of
               which is 365 ("Prorated Bonus"), and (4) any accrued vacation
               pay, in each case to the extent not previously paid;

               (b) "Discount Rate" shall mean the interest rate equal to the
               Prime Rate as reported in The Wall Street Journal, Midwest
               Edition, as in effect on the Date of Termination;

               (c) "Severance Benefit" means (x) in the case of a termination of
               employment which occurs prior to the commencement of the
               Transition Period, a lump sum payment equal to the aggregate of
               the amounts of the Annual Base Salary, the Annual Bonus and
               Continued Employment Period Salary which would have been
               receivable by the Executive if his or her Transition Period
               commenced on the Date of Termination and he or she had remained
               employed during the Transition Period and the Continued
               Employment Period, and (y) in the case of a termination of
               employment which occurs during the Transition Period or the
               Continued Employment Period, a lump sum payment equal to the
               aggregate of the amounts of the Annual Base Salary, the Annual
               Bonus and Continued Employment Period Salary which otherwise
               would have been receivable by the Executive if he or she had
               remained employed during the Transition Period and the Continued
               Employment Period; with the applicable amount being discounted
               from its scheduled payment date to the Date of Termination by
               reference to the Discount Rate,

               (d) "Target Percentage" shall mean the target percentage which
               the Executive was eligible to receive under TIP on the day
               immediately preceding the Change-in-Status Date (or in the
               absence of a Change-In

                                       13

<PAGE>

               Status Date, the day immediately preceding the Date of
               Termination) without any adjustment, but in no event lower than
               the Executive's highest target percentage in effect at any time
               between the Effective Date and the Change-in-Status Date (or in
               the absence of a Change-In-Status Date, the Date of Termination),
               provided that the target percentage shall be reduced to reflect
               any across-the-board reductions implemented by the Committee
               prior to the Change-in-Status Date (or in the absence of a
               Change-In-Status Date, the Date of Termination) which reductions
               affect Company officers generally; and

               (e) "Welfare Benefit" shall mean a lump sum payment (in lieu of
               continued participation in the Benefit Plans) equal to an amount
               equal to the Company's estimated cost of providing the Benefit
               Plans to the Executive throughout the Transition Period and the
               Continued Employment Period (as reasonably determinable by the
               Committee in its sole discretion on the Date of Termination).

          7.02 Death. If the Executive dies during the Retention Period, the
               -----
Transition Period or the Continued Employment Period (collectively, the
"Periods"), the Company shall have no further obligations to the Executive's
legal representatives under this Plan, other than for payment of Accrued Salary,
any Earned Bonus and any payment or provision of Other Benefits (as defined in
this Section 7.02). Such amounts shall be paid to the Executive's legal
representatives in a lump sum in cash within 60 days of death unless deferred in
accordance with the terms of an employee benefit plan or arrangement maintained
by the Company. Upon death, the Executive's unexercised stock options shall
remain subject to the applicable provisions of the related stock option plans
and applicable Golden M Certificates (or other applicable award agreements).

                  The term "Other Benefits" as utilized in this Section shall
mean benefits equal to the benefits provided by the Company to the estates and
beneficiaries of:

          (i)   other Executive Officers of the Company if the Executive dies
          during the Retention Period,

          (ii)  other officers of the Company who are non-Executive Officers if
          the Executive dies during the Transition Period, or

          (iii) other staff employees of the Company if the Executive dies
          during the Continued Employment Period,

under such plans, programs, practices and policies relating to death benefits,
if any, as in effect on the date of the Executive's death.

          7.03 Disability. If the Executive's employment is terminated by reason
               ----------
of Disability during any of the Periods, the Company shall not have any further
obligations to the

                                       14

<PAGE>

Executive, other than for payment of Accrued Salary, any Earned Bonus and
payment or provision of Other Benefits (as defined in this Section 7.03). Such
amounts shall be paid to the Executive in a lump sum in cash within 60 days of
the Disability Effective Date unless deferred in accordance with the terms of an
employee benefit plan or arrangement maintained by the Company. In the event of
Disability, the Executive's unexercised stock options shall remain subject to
the applicable provisions of the related stock option plans and applicable
Golden M Certificates (or other applicable award agreements).

          The term "Other Benefits" as utilized in this Section shall mean
disability and other benefits equal to those generally provided by the Company
to:

          (i)   disabled Executive Officers and/or their families if the
          Executive becomes disabled during the Retention Period,

          (ii)  disabled officers who are not Executive Officers and/or their
          families if the Executive becomes disabled during the Transition
          Period, or

          (iii) disabled staff employees and/or their families if the Executive
          becomes disabled during the Continued Employment Period,

in accordance with such plans, programs, practices and policies relating to
disability, if any, as in effect on the Disability Effective Date.

          7.04 By the Company for Cause. If an Executive's employment is
               ------------------------
terminated during any of the Periods by the Company for Cause, the Company shall
have no obligation to the Executive pursuant to this Plan other than to pay the
Executive his or her Accrued Salary through the Date of Termination and any
Earned Bonus. In any such case, all Accrued Salary and Earned Bonus shall be
paid to the Executive in a lump sum in cash within 60 days of the Date of
Termination unless otherwise deferred by the Executive pursuant to the terms of
an employee benefit plan or arrangement maintained by the Company. Upon such
termination, the Executive's stock options shall be governed by the express
provisions of the related stock option plans and applicable Golden M
Certificates (or other applicable award agreements).

          7.05 By a Tier I Executive Without Good Reason. If a Tier I Executive
               -----------------------------------------
terminates his employment during the Retention Period or the Transition Period
without Good Reason, or during the Continued Employment Period for any reason,
the Company shall have no obligation to the Executive pursuant to this Plan
other than to pay the Executive his or her Accrued Salary through the Date of
Termination and any Earned Bonus. In any such case, all Accrued Salary and
Earned Bonus shall be paid to the Executive in a lump sum in cash within 60 days
of the Date of Termination unless otherwise deferred by the Executive pursuant
to the terms of an employee benefit plan or arrangement maintained by the
Company. Upon such termination, the Executive's stock options shall be governed
by the express provisions of the related stock option plans and applicable
Golden M Certificates (or other applicable award agreements).

                                       15

<PAGE>

          7.06 By a Tier II Executive for any Reason. If a Tier II Executive
               -------------------------------------
terminates his employment during any of the Periods for any reason or no reason,
the Company shall have no obligation to the Executive pursuant to this Plan
other than to pay the Executive his or her Accrued Salary through the Date of
Termination and any Earned Bonus. In any such case, all Accrued Salary and
Earned Bonus shall be paid to the Executive in a lump sum in cash within 60 days
of the Date of Termination unless otherwise deferred by the Executive pursuant
to the terms of an employee benefit plan or arrangement maintained by the
Company. Upon such termination, the Executive's stock options shall be governed
by the express provisions of the related stock option plans and applicable
Golden M Certificates (or other applicable award agreements).

                                    Article 8

                       Requirement of Effective Releases;
                   Integration with Other Separation Benefits

          8.01 Releases as a Condition to Plan Benefits. It shall be a condition
               ----------------------------------------
to an Executive's right to receive any benefits pursuant to this Plan that the
Executive shall execute and deliver to the Company the following releases in the
form provided by the Company (each, a "Release"):

               (i)   in the case of Transition Benefits, a Release with respect
          to the period ended on the Change-in-Status Date,

               (ii)  in the case of Continued Employment Benefits, a Release
          with respect to all periods ended on or before the last day of the
          Transition Period, and

               (iii) in the case of the Termination Payment, a Release with
          respect to all periods ended on the Date of Termination.

          8.02 Form of Release. Each Release shall provide among other things
               ---------------
that the Executive understands, intends and agrees that the agreement he or she
is signing constitutes full, complete and final satisfaction of all claims,
demands, lawsuits or actions of any kind, whether known or unknown, against the
Company or its subsidiaries, divisions, affiliates and related companies
(collectively "McDonald's") or their respective directors, officers or employees
(with McDonald's collectively the "Released Persons") and that the Executive
forever releases each Released Person from all such matters. This includes, but
is not limited to, a release of claims, demands, lawsuits and actions of any
kind relating to any employment or application for employment or franchise,
claims relating to resignation and/or cessation of employment, claims alleging
breach of contract of any tort, claims for wrongful termination, defamation,
intentional infliction of emotional distress, personal injury, violation of
public policy and/or negligence related to employment or resignation, claims
under Title VII of the Civil Rights Act of 1964, as amended, Section 1981 of the
Civil Rights Act of 1866, as amended, the Age Discrimination in Employment Act
of 1967, as amended, the Rehabilitation Act of 1973, the Americans with
Disabilities Act of 1990, the Employee Retirement Income Security Act of 1974,
as amended, the

                                       16

<PAGE>

Worker Adjustment and Retraining Notification Act, the Family and Medical Leave
Act of 1993, the Illinois Human Rights Act, or any other state, Federal or local
law prohibiting discrimination, and claims based on any other law, regulation,
or common law, whether before any Federal, state or local agency, in any court
of law or before any other forum.

          8.03 Other Separation Benefits. The Releases will also provide that
               -------------------------
(i) the payments or benefits provided for hereunder shall be in lieu of any
payments, benefits or arrangements to which the Executive might otherwise be
entitled to under any plan or arrangement which provides for severance or
separation ("Other Separation Benefits") and, that (ii) the Executive waives any
and all rights and claims that he or she may then or thereafter have to (A) any
Other Separation Benefits and (B) retiree status under any of the Company's
stock option plans.

          8.04 Effect of Claim. If an Executive (i) files a lawsuit, charge,
               ---------------
complaint or other claim asserting any claim or demand within the scope of his
or her Releases, (ii) fails to execute and deliver a Release required pursuant
to Section 8.01, or (iii) purports to revoke any of the Releases, the Company
shall retain all rights and benefits of the Releases, and in addition, shall be
entitled to cancel any and all future obligations under this Plan and recoup the
value of all payments and benefits under this Plan, together with the Company's
costs and reasonable attorney's fees. In addition, the Company shall be entitled
to pursue any other remedy available to enforce the terms of the Releases and
Noncompetition Agreement described in Article 9.

                                    Article 9

                     Requirement of Noncompetition Agreement

          9.01 Noncompetition Agreement as a Condition to Plan Benefits. It
               --------------------------------------------------------
shall be a condition to receive Transition Benefits, Continued Employment
Benefits and the Severance Benefit under this Plan that the Executive shall have
signed a confidentiality and noncompetition agreement in the form provided by
the Company as substantially described in this Article 9 (the "Noncompetition
Agreement"). The failure or refusal of an Executive to sign such a
Noncompetition Agreement shall disqualify the Executive from receiving any
benefits under this Plan.

     9.02 Form of Noncompetition Agreement.
          --------------------------------

     (a) Confidentiality.  Each Executive's Noncompetition Agreement shall
provide that:

               (i) the Executive acknowledges that it is the policy of
               McDonald's to maintain as secret and confidential all valuable
               and unique tangible and intangible information and techniques
               acquired, developed or used by McDonald's relating to its
               business, operations, employees and customers, which gives
               McDonald's a competitive advantage in the businesses in which
               McDonald's is engaged ("Confidential Information").

                                       17

<PAGE>

               (ii)  the Executive recognizes that all such Confidential
               Information is the sole and exclusive property of McDonald's, and
               that disclosure of Confidential Information would cause
               significant damage to McDonald's; and

               (iii) the Executive shall not, without the prior written consent
               of the Company, use, disclose, furnish or make accessible to any
               person, firm, corporation, partnership or other entity of any
               kind (collectively, "Person") any Confidential Information
               obtained during the Executive's employment with McDonald's at any
               time (including, without limitation, during or after the
               Retention Period, the Transition Period or the Continued
               Employment Period) for so long as such information is valuable
               and unique except (A) with the prior written consent of
               McDonald's in respect of such disclosure, (B) as required by the
               duties of the Executive's employment with McDonald's, (C) in
               connection with the Executive's good-faith enforcement of his or
               her rights under this Plan, or (D) if the Executive reasonably
               and in good faith believes that he or she is compelled by law or
               by a court or governmental agency by a proper proceeding;
               provided that the Executive, to the extent not prohibited from
               doing so by applicable law or court order, shall give the Company
               written notice of the Confidential Information to be so disclosed
               pursuant to clause (C) or (D) of this sentence as far in advance
               of its disclosure as is lawful and practicable, shall cooperate
               (at the Company's sole expense) with the Company in its efforts
               to protect the information from disclosure, and shall limit his
               or her disclosure of such Confidential Information to the minimum
               disclosure required by law or court order unless the Company
               agrees in writing to a greater level of disclosure.

          (b) Noncompetition. Each Executive's Noncompetition Agreement will
also provide that the Executive will not, at any time during the period
specified in Section 9.02(c), directly or indirectly:

               (i)   in any capacity, engage or participate in, or become
               employed by or render advisory or consulting or other services in
               connection with any Prohibited Business (as defined in Section
               9.03), provided that nothing in this Section 9.02(b) shall
               preclude an Executive from performing services on behalf of an
               investment banking or commercial banking, auditing or consulting
               firm so long as he or she is not engaged in rendering services to
               or soliciting business of a Prohibited Business;

               (ii)  make any financial investment, whether in the form of
               equity or debt, or own any interest, directly or indirectly, in
               any Prohibited Business, provided that nothing in this Section
               9.02(b) shall restrict the Executive from owning, of record or
               beneficially, up to one percent of the outstanding voting
               securities of any publicly traded corporation; provided

                                       18

<PAGE>

               that such investment does not create a conflict of interest
               between the Executive's duties hereunder and the Executive's
               interest in such investment;

               (iii) employ any employee of McDonald's (with the exception of
               the Executive's administrative assistant) or any Person who was
               employed by the Company within 180 days of such hiring; or

               (iv)  interfere with McDonald's relationship with, or endeavor to
               entice away from McDonald's any employees (other than the
               Executive's administrative assistant), customers, vendors or
               suppliers, franchisees or business partners of the Company.

          (c)  Restrictive Period. The Noncompetition Agreement shall provide
that the covenants described in Section 9.02(b) shall remain in effect (i) at
all times during an Executive's Transition Period and Continued Employment
Period and (ii) if the Executive's employment is terminated by the Company or by
the Executive for any reason or for no reason during the Transition Period or
the Continued Employment Period, for two years after the Date of Termination
(but in no event after the end of the Continued Employment Period).

          9.03 Prohibited Business. For purposes of this Plan, "Prohibited
               -------------------
Business" means any Person (and any branches, offices or operations thereof)
that is a material and direct competitor of McDonald's in any country in the
world or in any state of the United States, but shall not include any Person
which is not one of the 15 or fewer Persons designated as a Prohibited Business
on Annex A attached to the Executive's Noncompetition Agreement.

          9.04 Remedy. (a) Injunctive Relief. The Noncompetition Agreement shall
               ------
also provide that:

               (i)   in recognition of the confidential nature of the
               Confidential Information, and in recognition of the necessity of
               the limited restrictions imposed by the Noncompetition Agreement,
               it would be impossible to measure solely in money the damages
               which the Company would suffer if the Executive were to breach
               any of his obligations under such Agreement;

               (ii)  any breach of any such provisions of the Noncompetition
               Agreement would irreparably injure the Company;

               (iii) if the Executive breaches any of the provisions of the
               Noncompetition Agreement, the Company shall be entitled, in
               addition to any other remedies to which the Company may be
               entitled under the Noncompetition Agreement or otherwise, to an
               injunction issued by a court of competent jurisdiction, to
               restrain any breach or threatened breach, of such provisions, and
               the Executive waives any right to assert

                                       19

<PAGE>

               any claim or defense that the Company has an adequate remedy at
               law for any such breach.

          (b) Effect on Other Benefits. Each Executive's Noncompetition
Agreement shall also provide that, in the event of a breach by such Executive of
the provisions of his or her Noncompetition Agreement excluding for this purpose
an isolated, insubstantial and inadvertent action, the Company shall be entitled
to (i) discontinue any and all payments and other benefits to which the
Executive or his or her beneficiaries would otherwise be entitled pursuant to
this Plan, (ii) terminate any and all unexercised stock options then held by the
Executive or by any transferee of the Executive, (iii) require the Executive to
repay to the Company the aggregate amount of cash payments received by the
Executive from the Company pursuant to this Plan during the period commencing on
the Executive's Change-in-Status Date and ending on the date on which the
Company requests such repayment (the "Recovery Period") and (iv) require the
Executive to pay to the Company (A) with respect to stock options that were not
vested as of the Executive's Change-in-Status Date, the aggregate amount of gain
recognized by the Executive during the Recovery Period as the result of the
exercise by the Executive or by any transferee of the Executive of such stock
options, and (B) with respect to stock options that were vested as of the
Executive's Change-in-Status Date, an amount equal to the positive difference,
if any, of (I) the aggregate amount of gain recognized by the Executive during
the Recovery Period as the result of the exercise by the Executive or by any
transferee of the Executive of such stock options ("Exercised Options"), minus
(II) the amount of gain that would have been recognized by the Executive had the
Exercised Options been exercised as of the Executive's Change-in-Status Date.

                                   Article 10

                          Legal Fees and Other Expenses

          If an Executive incurs legal and other fees or other expenses in a
good faith effort to obtain benefits under this Plan, regardless of whether the
Executive ultimately prevails, the Company shall reimburse the Executive on a
monthly basis upon the written request for such fees and expenses to the extent
not reimbursed under the Company's officers and directors liability insurance
policy, if any. The existence of any controlling case or regulatory law which is
directly inconsistent with the position taken by the Executive shall be evidence
that the Executive did not act in good faith.

          Reimbursement of legal fees and expenses shall be made monthly upon
the written submission of a request for reimbursement together with evidence
that such fees and expenses are due and payable or were paid by the Executive.
If the Company shall have reimbursed the Executive for legal fees and expenses
and it is later determined that the Executive was not acting in good faith, all
amounts paid on behalf of, or reimbursed to, the Executive shall be promptly
refunded to the Company.

                                       20

<PAGE>

                                   Article 11

                     Amendment and Termination of this Plan

          This Plan shall be effective on the Effective Date and shall remain in
effect until the later of (i) October 1, 2004, or (ii) a date that is two years
after the date on which the Company gives written notice to all Executives of
its intention to terminate the Plan. The Company has the right to amend this
Plan in whole or in part at any time; provided that no amendment of this Plan
shall be effective as to any Executive who is or may reasonably be expected to
be materially adversely affected thereby (an "Affected Executive") until the
later of (i) October 1, 2004, or (ii) a date that is two years after the date on
which the Company gives written notice to all Affected Executives of its
intention to adopt such amendment. Notwithstanding the foregoing, no Plan
termination or amendment shall become effective during the Transition Period or
Continued Employment Period as to any Affected Executive. Any purported Plan
termination or amendment in violation of this Section 11 shall be void and of no
effect. Notwithstanding the foregoing, any Executive may consent in writing to
any amendment or termination of this Plan.

                                   Article 12

                            Miscellaneous Provisions

          12.01 Successors. This Plan shall be binding upon the Company and its
                ----------
successors and assigns. Subject to satisfaction of the conditions set forth in
Sections 3, 4, 5 and 8, the Plan shall inure to the benefit of the Executives
and their respective successors, heirs and permitted assigns.

          12.02 Executive Information. Each Executive shall notify the Committee
                ---------------------
of his or her mailing address and each change of mailing address to the extent
that he or she has not previously informed the Company thereof. In addition,
each Executive shall furnish the Committee with any other information and data
that the Committee reasonably considers necessary for the proper administration
of this Plan. The information provided by the Executive under this Section shall
be binding upon the Executive, his or her dependents and any beneficiaries for
all purposes of this Plan. The Committee shall be entitled to rely on any
representations regarding personal facts made by an Executive, his or her
dependents or beneficiaries, unless it has knowledge that such representations
are false.

          12.03 Payments to Beneficiary. If an Executive dies before receiving
                -----------------------
amounts to which he is entitled under this Plan, such amounts shall be paid to
the Beneficiary (as defined below) or if none, to the Executive's estate. If a
Beneficiary dies before complete payment of any benefits attributable to a
deceased Executive, the remaining benefits shall be paid the Beneficiary's
estate. For purposes of this Plan, a Beneficiary shall mean any Person or
Persons, including any entity which is tax-exempt under Section 501(c)(3) of the
Internal Revenue Code, designated in writing by an Executive.

                                       21

<PAGE>

          12.04 Notices. Any notice, request, election, or other official
                -------
communication under this Plan shall be in writing and shall be delivered
personally, by courier service, by registered or certified mail, return receipt
requested or by telecopy and shall be effective upon actual receipt by the party
to which such notice shall be directed, and shall be addressed as follows: (i)
if to the Company, McDonald's Corporation, One McDonald's Plaza, Oak Brook IL
60523, Attention: Corporate Secretary, and (ii) if to an Executive, the last
mailing address as specified by the Executive in accordance with Section 12.02.

          12.05 No Employment Contract. The existence of this Plan shall not
                ----------------------
confer any legal or other rights upon any Executive to a continuation of
employment. The Company and each successor thereof reserves the right to
terminate the employment of any Executive, with or without cause, at any time,
notwithstanding the existence of this Plan.

          12.06 Non-Alienation. Except to the extent expressly permitted by law,
                --------------
no Executive shall have the right to assign, transfer or anticipate an interest
in any benefit under this Plan.

          12.07 Severability. If any one or more articles, sections or other
                ------------
portions of this Plan are declared by any court or governmental authority to be
unlawful or invalid, such unlawfulness or invalidity shall not serve to
invalidate any article, section or other portion not so declared to be unlawful
or invalid. Any article, section or other portion so declared to be unlawful or
invalid shall be construed so as to effectuate the terms of such article,
section or other portion to the fullest extent possible while remaining lawful
and valid.

          12.08 No Waiver. An Executive's failure to insist upon strict
                ---------
compliance with any provision of this Plan shall not be deemed a waiver of such
provision or any other provision of this Plan. An Executive may waive any or all
of the provisions of this Plan only by signing a document to that effect. A
waiver of any provision of this Plan shall not be deemed a waiver of any other
provision, and any waiver of any default in any such provision shall not be
deemed a waiver of any later default thereof or of any other provision.

          12.09 Governing Law. To the extent not preempted by federal law, this
                -------------
Plan shall be interpreted and construed in accordance with the laws of the State
of Illinois, without regard to any otherwise applicable conflicts of law or
choice of law principles.

          12.10 Construction. Any masculine personal pronoun shall be considered
                ------------
to mean also the corresponding feminine or neuter personal pronoun, as the
context requires. The singular and plural forms of any term used in this Plan
shall be interchangeable, as the context requires.

          12.11 Captions. The captions of the Sections and Articles of this Plan
                --------
are not a part of the provisions hereof and shall have no force or effect.

                                       22

<PAGE>

                                   Appendix A

Tier I Executives
-----------------

Jack Greenberg
Jim Cantalupo

Tier II Executives
------------------

Claire Babrowski
Mike Conley
Alan Feldman
Jeff Kindler
Jim Skinner
Stan Stein

Start Dates
-----------

Tier I Executives:  April 29, 1998
Tier II Executives:  October 1, 1998

                                       23

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