Special Incentive Agreement - United Technologies Corp. and C. Scott Greer




                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES


December 21, 1998

C. Scott Greer
160 Chesterfield Road
Bloomfield Hills, MI 48304

Re:  Special Incentive Arrangement

Dear Scott:

  As you know, over the next several months, we will be exploring the  potential
sale of  UTA, either  in its  entirety or  in segments.   Your  support will  be
critical to the success of this  divestiture initiative. In addition,  marketing
UTA without  disruption to  the ongoing,  successful operation  of the  business
presents  special  challenges  for  you.    In  recognition  of  the  additional
responsibilities you will assume in connection with UTC's efforts to divest UTA,
UTC  is  prepared  to  offer  you   certain  special  financial  incentives   in
consideration of certain  commitments from  you.   The incentives  consist of  a
special award of restricted stock and a special cash payment, to be described in
full detail below.   Your commitments to  UTC pertain to:  (i) your efforts  and
conduct in  support of  the marketing  of  the business;  (ii) your  ability  to
maintain UTA's successful financial  and operational performance throughout  the
entire marketing phase, regardless of ultimate  outcome; and (iii) in the  event
of a  divestiture, achieving  a transaction  that provides  UTC with  sufficient
value for the sale of UTA.

                              Incentives

  If you agree  to the terms and conditions set  forth in this letter, UTC  will
award you 10,000 shares of restricted stock.  These shares will be subject to  a
vesting period of three years.  If, however, the business is sold prior to  that
date, the vesting will be accelerated to  the date that is six months  following
the closing date,  if the transaction  is deemed to  be 'successful' from  UTC's
perspective.  The criteria for a successful transaction are described below.  In
the event that the  business is sold  in segments, your  vesting will occur  six
months following the completion of  the sale of the  last business segment.   If
the purchaser of the business terminates your employment prior to the expiration
of the six month  period, vesting will be  accelerated to the termination  date.
Otherwise, you are required to remain with the business for the six month period
following the closing.   Prior to  vesting, you will  receive dividends and  all
other rights of  share ownership,  except that  you will  not be  able to  sell,
pledge, or assign any interest in  the shares.  If  your employment with UTA  is
terminated for any reason (other than death or disability) prior to the complete
divestiture of UTA or the end of the three-year vesting period, the shares  will
be forfeited without value.

  In addition to the restricted stock  award, UTC will make a special  incentive
payment to you  in an amount  up to $2,000,000,  subject to certain  conditions,
payable six  months after  the closing  date of  the sale  of UTA  (or the  last
segment thereof) (the 'Special Incentive Payment').   The actual amount of  such
payment will be  based upon the  degree to which  the divestiture constitutes  a
'successful' sale, as determined by UTC  in its sole discretion, and the  degree
to which certain other performance criteria have  been met.  The criteria for  a
successful divestiture and the other  performance criteria are described  below.
Outstanding overall performance will result in full payment.
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                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES



                         Terms and Conditions

  For purposes of this Agreement, a 'successful' sale will be determined on  the
basis of several  financial and subjective  factors.   Exact dollar  thresholds,
formulas or percentage weightings  for different factors  will not be  utilized.
However, as UTC evaluates the sale of UTA with its outside advisors, you will be
kept informed of targets, objectives and  ranges of acceptable outcomes as  they
are developed.  The  factors that will determine  a successful divestiture  from
UTC's perspective include, without limitation,  the ultimate purchase price  net
of any  retained liabilities,  the structure  of the  transaction (and  its  tax
impacts), the  allocation  of  tax,  environmental  and  other  liabilities  and
contingencies between buyer and seller, the  timing to completion, post  closing
risks retained by UTC, and  such other factors as  may be determined during  the
sale process.    All  of  these  factors are  relevant  to  determining  if  the
transaction, on a net basis, provides adequate value to UTC relative to the long
term value of UTA.  UTC  will evaluate these factors  in its sole discretion  to
determine  to  what  extent  the  overall  transaction  may  be  deemed  to   be
'successful'.

  In  addition to  achieving a  successful divestiture,  accelerated vesting  of
your restricted shares  and eligibility for  the Special  Incentive Payment  are
both  also  subject  to  you  (i)  maintaining  certain  individual  performance
standards during  the marketing  phase of  the business;  and, (ii)  maintaining
UTA's performance during this period of time to avoid deterioration of financial
and operating performance.

  During the marketing phase, you will be expected to represent and further  the
best interests  of UTC  at all  times. You  will be  expected to  represent  the
business in its best light in a consistent manner to all prospective purchasers,
regardless of your opinion as to the quality or desirability of any  prospective
purchaser.   In addition,  it will  be imperative  that you  not engage  in  any
independent efforts relative to marketing UTA.  All potential purchasers and any
other related  inquiries  or contacts  and  other information  relevant  to  the
marketing effort must  be directed  to the office  of UTC's  Vice President  for
Strategic Planning.  During this  period of time, you  will also be expected  to
maintain absolute confidentiality with respect to  UTC's efforts and the  status
of the divestiture efforts.  You must refrain  from any conduct that in any  way
conflicts with  the best  interests of  UTC  in this  transaction.   Failure  to
observe completely the provisions of this paragraph may result in forfeiture  of
your shares and your rights to the special incentive payment.

  Maintaining  the  successful  operation of  UTA  amid  the  distraction  of  a
potential sale of the business presents special challenges.  Nonetheless, it  is
critical to UTC that UTA's achievements and momentum in several key areas not be
sacrificed as a  result of UTC's  decision to market  the company for  potential
divestiture.  We expect  that all financial and  operating plans and  objectives
will be met during this period.   Manufacturing quality, productivity,  customer
relationships, employee  retention, engineering  and marketing  initiatives  and
other key facets of the business must also not be compromised in any way.

  It  is  critical that  overall  business  performance and  the  value  of  the
business be maintained, regardless  of the outcome of  divestiture efforts.   If
UTC, in its sole discretion, determines that the quality of the business, either
financially or  operationally, materially  deteriorates during  the  divestiture

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                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES


process, the restricted share  awards and your rights  to the Special  Incentive
Payment will be forfeited.

  The restricted share award and the Special Incentive Payment are subject to
approval by the Compensation and Executive Development Committee of UTC's Board.
The benefits provided under this Agreement are separate and independent from
your eligibility for the Executive Leadership Group (the 'ELG') separation
benefit which will be payable to you subject to the terms of the ELG program,
without reduction or offset for amounts provided herein.

  Notwithstanding  your participation  in  this arrangement,  UTC  reserves  the
right to terminate your employment for cause,  in which case your rights to  the
restricted stock and the Special Incentive Payment will be forfeited.   Examples
of  a termination 'for cause' include failure to perform your  responsibilities,
ethical or legal violations or breach of this Agreement.

  In  consideration of  the benefits  provided under  this Agreement,  you  also
agree that you  will not voluntarily  terminate your employment  for any  reason
(other than death or permanent disability)  during the period of this  Agreement
(i.e. the earlier  of 6 months  following complete divestiture  or December  31,
2001).  In the event of death or  permanent long term disability (as defined  in
UTA's Long Term Disability Plan), vesting in the restricted stock award will  be
accelerated and the Special Incentive Payment will be cancelled.  Resignation or
termination for any  other reason will  result in forfeiture  of the  restricted
shares and the Special Incentive Payment.

  We believe that with your efforts, we can achieve a successful divestiture  of
UTA while  maintaining the  financial value  and  operational integrity  of  the
business.   Please acknowledge  your acceptance  by  signing and  returning  one
original copy of this letter to  my office.  If  you have any questions,  please
feel to call me at 860-728-7655.

                                   Very truly yours,



                                   /s/William L. Bucknall, Jr.

                                   William L. Bucknall, Jr.





Acknowledged and Accepted:





/s/ C. Scott Greer                                     April 1,1999

C. Scott Greer                                         Date



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