UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [_]

Check the appropriate box:

[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))

[X] Definitive Proxy Statement

[_] Definitive Additional Materials

[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12

THE LIMITED, INC.
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(Name of Registrant as Specified In Its Charter)

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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required

[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

(1) Title of each class of securities to which transaction applies:

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(2) Aggregate number of securities to which transaction applies:

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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):

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(4) Proposed maximum aggregate value of transaction:

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(5) Total fee paid:

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[_] Fee paid previously with preliminary materials.

[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

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(4) Date Filed:

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Notes:

[LETTERHEAD OF DAVIS POLK & WARDWELL APPEARS HERE]

April 14, 1999

Re: The Limited, Inc.

Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, DC 20549

Ladies and Gentlemen:

Pursuant to the Securities Act of 1934, as amended, please find enclosed
for filing via electronic submission on behalf of The Limited, Inc. ("The
Limited"), a Schedule 14A relating to its Definitive Proxy Statement dated April
14, 1999.

If you have any questions or comments relating to the enclosed filing,
please do not hesitate to call the undersigned at (212)450-4669, T.A. McKinney
at (212)450-6204 or David Caplan of this office at (212)450-4156.

Very truly yours,

/s/ Craig Nemiroff

Craig Nemiroff

[LOGO OF THE LIMITED, INC. APPEARS HERE]

April 14, 1999

Dear Stockholder:

You are cordially invited to attend our 1999 annual meeting of stockholders
to be held at 9:00 a.m., Eastern Daylight Time, on May 17, 1999, at our
offices located at Three Limited Parkway, Columbus, Ohio. Our Investor
Relations telephone number is (614) 415-7076 should you require assistance in
finding the location of the meeting. The formal Notice of Annual Meeting of
Stockholders and Proxy Statement are attached. I hope that you will be able to
attend and participate in the meeting, at which time I will have the
opportunity to review the business and operations of The Limited.

The matters to be acted upon by our stockholders are discussed in the Notice
of Annual Meeting of Stockholders. It is important that your shares be
represented and voted at the meeting. Accordingly, after reading the attached
Proxy Statement, would you kindly sign, date and return the enclosed proxy
card or vote by telephone or by Internet as described on the enclosed proxy
card. Your vote is important regardless of the number of shares you own.

Sincerely yours,
/s/ Leslie H. Wexner
Leslie H. Wexner
Chairman of the Board

[LOGO OF THE LIMITED, INC. APPEARS HERE]

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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

May 17, 1999

April 14, 1999

To our Stockholders:

We are pleased to invite you to attend our 1999 annual meeting of
stockholders to:

.Elect four directors to serve for terms of three years.

.Transact such other business as may properly come before the meeting.

Stockholders of record at the close of business on March 26, 1999 may vote
at the meeting.

Your vote is important. This year, stockholders of record can give proxies
by calling a toll-free telephone number, by using the Internet or by mailing
their signed proxy cards. Whether or not you plan to attend the meeting,
please vote by telephone or Internet or sign, date and return the enclosed
proxy card in the envelope provided. Instructions are included on your proxy
card. You may change your vote by submitting a later dated proxy (including a
proxy via telephone or the Internet) or by attending the meeting and voting in
person.

By Order of the Board of Directors
/s/ Leslie H. Wexner
Leslie H. Wexner
Chairman of the Board

PROXY STATEMENT TABLE OF CONTENTS

Information About the Annual Meeting and Voting............................. 2
Election of Directors....................................................... 4
Nominees and directors...................................................... 4
Information concerning the Board of Directors............................... 6
Committees of the Board of Directors........................................ 6
Security ownership of directors and management.............................. 8
Certain relationships and related transactions.............................. 9
Executive Compensation...................................................... 11
Summary compensation table.................................................. 11
Long-term incentive plan awards............................................. 13
Stock options............................................................... 13
Compensation of directors................................................... 14
Employment agreements with certain executive officers....................... 15
Section 16(a) beneficial ownership reporting compliance..................... 15
Report of the Compensation Committee........................................ 16
Compensation philosophy..................................................... 16
Principal compensation elements............................................. 16
CEO compensation............................................................ 18
Stockholder Return Graph.................................................... 20
Share Ownership of Principal Stockholders................................... 21
Independent Public Accountants.............................................. 21
Other Matters............................................................... 22
Stockholder Proposals....................................................... 22
Solicitation Expenses....................................................... 22

INFORMATION ABOUT THE ANNUAL MEETING AND VOTING

The Board of Directors of The Limited, Inc. is soliciting your proxy to vote
at our 1999 annual meeting of stockholders (or at any adjournment of the
meeting). This proxy statement summarizes the information you need to know to
vote at the meeting. "We", "our", "The Limited", and the "Company" refer to
The Limited, Inc.

We began mailing this proxy statement and the enclosed proxy card on or
about April 14, 1999 to all stockholders entitled to vote. The Limited 1998
Annual Report, which includes our financial statements, is being sent with
this proxy statement.

Date, time and place of meeting

Date: May 17, 1999

Time: 9:00 a.m., Eastern Daylight Time

Place: Three Limited Parkway
Columbus, Ohio

Shares entitled to vote

Stockholders entitled to vote are those who owned The Limited common stock
(which we refer to throughout this proxy statement as "Common Stock") at the
close of business on the record date, March 26, 1999. As of the record date,
there were 228,165,712 shares of Common Stock outstanding. Each share of
Common Stock that you own entitles you to one vote.

Voting your proxy

Whether or not you plan to attend the annual meeting, we urge you to vote.
This year, stockholders of record can give proxies by calling a toll-free
telephone number, by using the Internet or by mailing their signed proxy
cards. The telephone and Internet voting procedures are designed to
authenticate stockholders' identities, to allow stockholders to give their
voting instructions and to confirm that stockholders' instructions have been
recorded properly. If you are voting by mail, please complete, sign and date
the enclosed proxy card and return it promptly in the envelope provided. If
you are voting by telephone or the Internet, please use the telephone or
Internet voting procedures set forth on the enclosed proxy card. Returning the
proxy card or voting via telephone or the Internet will not affect your right
to attend the meeting and vote.

The enclosed proxy card indicates the number of shares that you own.

Voting instructions are included on your proxy card. If you properly fill in
your proxy card and send it to us or vote via telephone or the Internet in
time to vote, one of the individuals named on your proxy card (your "proxy")
will vote your shares as you have directed. If you sign the proxy card or vote
via telephone or the Internet but do not make specific choices, your proxy
will follow the Board's recommendations and vote your shares:

. "FOR" the election of all 4 nominees for director (as described on
page 4).

If any other matter is presented at the meeting, your proxy will vote in
accordance with his or her best judgment. At the time this proxy statement
went to press, we knew of no other matters to be acted on at the meeting.

Revoking your proxy

You may revoke your proxy by:

. submitting a later dated proxy (including a proxy via telephone or the
Internet),

. notifying our Secretary in writing before the meeting that you have
revoked your proxy, or

. voting in person at the meeting.

Voting in person

If you plan to attend the meeting and vote in person, a ballot will be
available when you arrive. However, if your shares are held in the name of
your broker, bank or other nominee, you must bring an account statement or
letter from the nominee indicating that you are the beneficial owner of the
shares on March 26, 1999, the record date for voting.

Appointing your own proxy

If you want to give your proxy to someone other than the individuals named
as proxies on the proxy card, you may cross out the names of those individuals
and insert the name of the individual you are authorizing to vote. Either you
or that authorized individual must present the proxy card at the meeting.

Quorum requirement

A quorum of stockholders is necessary to hold a valid meeting. The presence
in person or by proxy at the meeting of holders of shares representing one-
third of the votes of the Common Stock entitled to vote constitutes a quorum.
Abstentions and broker "non-votes" are counted as present for establishing a
quorum. A broker non-vote occurs on an item when a broker is not permitted to
vote on that item absent instruction from the beneficial owner of the shares
and no instruction is given.

Vote necessary to elect directors

Item Vote Necessary*
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Election of directors Directors are elected by a plurality of the votes
represented by the shares of Common Stock present at the
meeting in person or by proxy. This means that the
director nominee with the most affirmative votes for a
particular slot is elected for that slot.

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* Under New York Stock Exchange rules, if your broker holds your shares in its
name, your broker is permitted to vote your shares on this item even if it
does not receive voting instructions from you.

ELECTION OF DIRECTORS

Our Board of Directors has nominated 4 directors for election at the annual
meeting. Each nominee is currently serving as one of our directors. If you re-
elect them, they will hold office for a three-year term expiring at the 2002
annual meeting or until their successors have been elected.

Your proxy will vote for each of the nominees unless you specifically
withhold authority to vote for a particular nominee. If any nominee is unable
to serve, your proxy may vote for another nominee proposed by the Board. We do
not know of any nominee of the Board who would be unable to serve as a
director if elected.

Stockholders wishing to nominate directors for election may do so by
delivering to the Secretary of the Company, no later than 14 days before the
annual meeting, a notice stating (a) the name, age, business address and, if
known, residence address of each nominee proposed in the notice, (b) the
principal occupation or employment of each nominee and (c) the number of
shares of Common Stock of the Company beneficially owned by each nominee. No
person may be elected as a director unless he or she has been nominated by a
stockholder in this manner or by the Board of Directors.

The Board of Directors recommends the ELECTION of all of the following
nominees of the Board of Directors:

Nominees and directors

Nominees of the Board of Directors for election at the 1999 annual meeting.

Leonard A. Schlesinger Director since 1996 Age 46

Dr. Schlesinger has been a member of the faculty of Brown University since
1998 and currently is a Professor of Sociology and Public Policy and the
Senior Vice President for Development. He also was Professor of Business
Administration at Harvard Business School ("Harvard") from 1988 to 1998 and
served as the Senior Associate Dean and Director of External Relations at
Harvard from July 1994 until October 1995. Dr. Schlesinger currently is a
director of Borders Group, Inc., GC Companies, Inc. and Pegasystems, Inc.

Donald B. Shackelford Director since 1975 Age 66

Mr. Shackelford has been Chairman of the Board of Fifth Third Bank, Central
Ohio, a banking business, since 1998. Mr. Shackelford was Chairman of the
Board and Chief Executive Officer of State Savings Bank from 1972 to 1998. He
was Chairman of the Board and Chief Executive Officer of State Savings Co. for
five years ending in 1997. Mr. Shackelford is also a director of Fifth Third
Bancorp., Intimate Brands, Inc., a subsidiary of The Limited ("Intimate
Brands"), Progressive Corporation and Worthington Foods, Inc.

Martin Trust Director since 1978 Age 64

Mr. Trust has been President and Chief Executive Officer of Mast Industries,
Inc., a wholly-owned subsidiary of The Limited, for more than five years. He
is also a director of Staples, Inc.

Raymond Zimmerman Director since 1984 Age 65

Mr. Zimmerman has been Chairman of the Board of Service Merchandise Company,
Inc. ("Service Merchandise"), a retail catalogue merchandising business, since
1999, and also held that position from 1997 to 1998. He was Chairman of the
Board and Chief Executive Officer of Service Merchandise from 1981 to 1997.

Directors whose terms continue until the 2000 annual meeting.

E. Gordon Gee Director since 1991 Age 55

Dr. Gee has been President of Brown University since January 1998. Dr. Gee
was President of The Ohio State University from 1990 to 1997. Dr. Gee is also
a director of Allmerica Financial, ASARCO, Inc., Glimcher Realty Trust and
Intimate Brands.

Claudine B. Malone Director since 1982 Age 62

Ms. Malone has been President and Chief Executive Officer of Financial &
Management Consulting, Inc. since 1984. She is also Chairman of the Federal
Reserve Bank of Richmond and a director of Dell Computer Corporation,
Hannaford Brothers, Inc., Hasbro, Inc., Houghton Mifflin Co., Lafarge
Corporation, Lowe's Companies, Mallinckrodt Group, Inc., Science Applications
International Corporation and Union Pacific Resources Corp.

Allan R. Tessler Director since 1987 Age 62

Mr. Tessler has been Chairman of the Board and Chief Executive Officer of
International Financial Group, Inc., a merchant banking concern, for more than
five years and Co-Chairman and Chief Executive Officer of Data Broadcasting
Corporation ("Data Broadcasting"), a data broadcasting network, since 1992.
Mr. Tessler was Chairman of the Board and Chief Executive Officer of
Ameriscribe Corporation, a provider of reprographic and related facilities
management services, from 1988 through 1993. Mr. Tessler is also the Chairman
of the Boards of Directors of Enhance Financial Services Group, Inc. and
Jackpot Enterprises, Inc. Mr. Tessler is a director of Allis-Chalmers
Corporation and Marketwatch.com.

Abigail S. Wexner Director since 1997 Age 37

Mrs. Wexner was an attorney with the law firm of Davis Polk & Wardwell from
1987 until 1992, where she specialized in mergers and acquisitions. She is a
director of the Children's Defense Fund and is a member of the Governing
Committee of The Columbus Foundation and the Board of Trustees of Children's
Hospital, Inc. in Columbus, Ohio and was appointed by the President of the
United States as a member of the United States Holocaust Memorial Council.
Mrs. Wexner is the wife of Leslie H. Wexner.

Directors whose terms continue until the 2001 annual meeting.

Leslie H. Wexner Director since 1963 Age 61

Mr. Wexner has been President and Chief Executive Officer since he founded
The Limited in 1963, and Chairman of the Board for more than five years. Mr.
Wexner has also been the Chairman of the Board and Chief Executive Officer of
Intimate Brands since 1995. Mr. Wexner is also a director of Hollinger
International, Inc. and Hollinger International Publishing, Inc. Mr. Wexner is
the husband of Abigail S. Wexner.

Eugene M. Freedman Director since 1995 Age 67

Mr. Freedman has been Managing Director of Monitor Clipper Partners, Inc., a
private equity firm, since 1997 and a director and chairman of the finance
committee of Monitor Company, Inc., an international business strategy and
consulting firm, since January 1995. Until October 1994, and for more than
five years prior thereto, Mr. Freedman was a partner of Coopers & Lybrand,
where he served as Chairman and Chief Executive Officer of Coopers & Lybrand
LLP, U.S. ("C & L, U.S.") since October 1991 and as Chairman of Coopers &
Lybrand, International ("C & L, Int.") since 1992. During The Limited's 1998
fiscal year, C & L, U.S. and its successor, PricewaterhouseCoopers LLP
("PWC"), served as The Limited's independent public accountants. The amount of
compensation paid by The Limited to C & L, U.S. and PWC for such services was
less than 1% of The Limited's and C & L, U.S.'s and PWC's consolidated gross
revenues for their 1998 fiscal years. Mr. Freedman is also a director of
Bernard Technologies, Inc.

Kenneth B. Gilman Director since 1990 Age 52

Mr. Gilman has been Vice Chairman and Chief Administrative Officer of The
Limited since June 1997. He was also Vice Chairman and Chief Financial Officer
of The Limited from June 1993 to June 1997. For more than five years prior
thereto, Mr. Gilman was Executive Vice President and Chief Financial Officer
of The Limited. Mr. Gilman has also been Vice Chairman of the Board of
Intimate Brands since 1995.

David T. Kollat Director since 1976 Age 60

Dr. Kollat has been Chairman of 22, Inc., a management consulting firm,
since 1987. He is also a director of Audio Environments, Inc., Cheryl & Co.,
Inc., Christy Partners, Consolidated Stores Corporation, Cooker Restaurant
Corporation, Resource Marketing, Inc., SBC Advertising, Select Comfort, Inc.,
Starpower Inc. and Wolverine World Wide, Inc.

Information concerning the Board of Directors

Our Board of Directors held 7 meetings in fiscal year 1998. During fiscal
year 1998, all of the directors, except for Mr. Freedman, attended 75% or more
of the total number of meetings of the Board and of committees of the Board on
which they served.

Committees of the Board of Directors

Audit Committee.

The Audit Committee of the Board recommends the firm to be employed as our
independent public accountants and reviews the scope of the audit and audit
fees. In addition, the Audit Committee consults with the independent auditors
about the plan of audit, the resulting audit report and the accompanying
management letter. The Audit Committee also confers with the independent
auditors about the adequacy of internal accounting controls, as appropriate,
outside of the presence of management. The members of the Audit Committee are
Ms. Malone (Chair) and Messrs. Shackelford, Tessler and Zimmerman. The Audit
Committee held 12 meetings in fiscal year 1998.

Compensation Committee.

The Compensation Committee of the Board reviews executive compensation and
administers our stock option and performance incentive plans. Its members are
Mr. Shackelford (Chair) and Dr. Gee. Members of the

Compensation Committee held 8 meetings in fiscal year 1998 and took action in
writing without a meeting on 19 occasions.

Executive Committee.

The Executive Committee of the Board may exercise, to the fullest extent
permitted by law, all of the powers and authority granted to the Board. The
Executive Committee may also declare dividends, authorize the issuance of
stock and authorize the seal of The Limited to be affixed to papers that
require it. Its members are Messrs. Wexner (Chair) and Shackelford. The
Executive Committee took action in writing without a meeting on 2 occasions in
fiscal year 1998.

Finance Committee.

The Finance Committee of the Board periodically reviews our financial
position and financial arrangements with banks and other financial
institutions. The Finance Committee also makes recommendations on financial
matters that it believes are necessary, advisable or appropriate. Its members
are Mses. Malone and Wexner and Messrs. Tessler (Chair), Freedman, Shackelford
and Zimmerman. The Finance Committee held 5 meetings in fiscal year 1998.

Nominating Committee.

The Nominating Committee of the Board nominates, on behalf of the Board,
suitable persons for election as directors of The Limited. Its members are
Messrs. Tessler (Chair) and Wexner. Stockholders are permitted to nominate
directly directors for election (see "ELECTION OF DIRECTORS" above);
therefore, no formal procedures exist for stockholders to make nominee
recommendations to the Nominating Committee. The Nominating Committee took
action in writing without a meeting on one occasion in fiscal year 1998.

Security ownership of directors and management

The following table shows certain information about the securities ownership
of all directors of The Limited, the executive officers of The Limited named
in the Summary Compensation Table below and all directors and executive
officers of The Limited as a group.

Number of Shares of Intimate Percent of
Percent Brands, Inc. Class A Intimate Brands,
Number of Shares of Common of Common Stock Beneficially Inc. Class A
Name Stock Beneficially Owned (a)(b) Class Owned (a)(b) Common Stock
---- ------------------------------- -------- ---------------------------- ----------------

Eugene M. Freedman...... 6,430 (f) * 0 **
E. Gordon Gee........... 3,492 (f) * 4,209 (k) *
Kenneth B. Gilman....... 449,302 (c)(e)(f) * 36,078 (d)(k) *
V. Ann Hailey........... 34,914 (f) * 0 **
Arnold F. Kanarick...... 166,594 (e)(f) * 1,470 *
David T. Kollat......... 202,492 (f) * 0 **
Claudine B. Malone...... 4,517 (f) * 592 *
Leonard A. Schlesinger.. 3,492 (f) * 500 *
Donald B. Shackelford... 72,430 (c)(f) * 7,388 (k) *
Allan R. Tessler........ 22,694 (c)(f) * 0 **
Martin Trust............ 2,505,229 (c)(e)(f) * 8,823 (j) *
Abigail S. Wexner....... 1,009 (f) * 0 **
Leslie H. Wexner........ 58,625,235 (e)(f)(g) 25.8% 112,218 (k) *
Raymond Zimmerman....... 8,692 (f)(h) * 1,589 *
All directors and
executive officers as a
group.................. 62,106,522 (e)(f)(i) 27.2% 172,867 (k)(l) *

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* Less than 1%.
** Not applicable.
(a) Unless otherwise indicated, each named person has voting and investment
power over the listed shares and such voting and investment power is
exercised solely by the named person or shared with a spouse.
(b) Reflects ownership as of February 28, 1999.
(c) Includes the following number of shares owned by family members, as to
which beneficial ownership is disclaimed: Mr. Gilman, 1,117; Mr.
Shackelford, 18,955; Mr. Tessler, 202; and Mr. Trust, 207,890.
(d) Includes 1,000 shares owned by family members, as to which Mr. Gilman
disclaims beneficial ownership.
(e) Includes the following number of shares held as of February 28, 1999 in an
employee benefit plan, over which the participant has the power to dispose
or withdraw shares: Mr. Gilman, 34,270; Mr. Kanarick, 422; Mr. Trust,
29,077; Mr. Wexner, 539,436; and all directors and executive officers as a
group, 603,205.
(f) Includes the following number of shares issuable within 60 days upon the
exercise of outstanding stock options: Mr. Freedman, 1,271; Dr. Gee,
1,272; Mr. Gilman, 253,981; Ms. Hailey, 26,714; Mr. Kanarick, 127,210; Dr.
Kollat, 1,272; Ms. Malone, 1,272; Dr. Schlesinger, 1,272; Mr. Shackelford
1,272; Mr. Tessler, 1,272; Mr. Trust, 165,884; Mrs. Wexner, 254; Mr.
Wexner, 437,610; Mr. Zimmerman, 1,272; and all directors and executive
officers as a group, 1,021,828.
(g) Includes 350,000 shares held by Health and Science Interests II, 883,317
shares held by the Wexner Foundation, 81,081 shares held by the Harry,
Hannah & David Wexner Trust, 5,000,000 shares held by the Harry, Hannah,
David & Sarah Wexner Trust, and 18,750,000 shares held by The Wexner
Children's Trust. Mr. Wexner disclaims beneficial ownership of the shares
held by Health and Science Interests II and the Wexner Foundation. Mr.
Wexner shares investment and voting power with others with respect to
shares

held by the Wexner Foundation. The 18,750,000 shares held by The Wexner
Children's Trust are held subject to the terms of the Contingent Stock
Redemption Agreement described under "Certain relationships and related
transactions" below.
(h) Includes 1,200 shares which are Mr. Zimmerman's pro rata share of 3,600
shares owned by a corporation of which Mr. Zimmerman is president and a
33% shareholder plus 2,000 shares held by a partnership which is 45% owned
by Mr. Zimmerman and 45% owned by his wife.
(i) Includes 1,461,481 shares, as to which beneficial ownership is disclaimed.
(j) Includes 2,941 shares, as to which Mr. Trust disclaims beneficial
ownership.
(k) Includes the following number of shares issuable within 60 days upon the
exercise of outstanding stock options: Dr. Gee, 2,250; Mr. Gilman, 25,001;
Mr. Shackelford, 2,250; Mr. Wexner, 50,000; and all directors and
executive officers as a group, 79,501.
(l) Includes 3,941 shares, as to which beneficial ownership is disclaimed.

Certain relationships and related transactions

On January 26, 1996, The Limited, Leslie H. Wexner, our Chairman, Chief
Executive Officer and President, and The Wexner Children's Trust (the "Trust")
entered into a Contingent Stock Redemption Agreement, which was amended as of
July 19, 1996 (as so amended, the "Agreement"). Because the following
description of the material terms of the Agreement is only a summary, it is
not necessarily complete and is qualified in its entirety by reference to the
Agreement. The Agreement prior to the amendment referred to above was filed
with the Securities and Exchange Commission (the "Commission") as an exhibit
to The Limited's Schedule 13E-4 filed in connection with The Limited's issuer
tender offer which expired on March 6, 1996, and a copy of the Agreement with
the amendment referred to above was filed with the Commission as an exhibit to
our Annual Report on Form 10-K for the fiscal year ended February 1, 1997.
Those exhibits are available for inspection at the Commission.

A new, wholly-owned subsidiary (the "Subsidiary") of The Limited has
guaranteed The Limited's obligations under the Agreement. We capitalized the
Subsidiary with $351.6 million (representing the amount required to pay the
Redemption Price in the event of an exercise in full of the Redemption Right
(each, as defined below)). The Subsidiary will only take action provided by
the Agreement. Pursuant to the terms of the Agreement, the Trust deposited
18,750,000 shares (the "Subject Shares") in a custody account with Morgan
Guaranty Trust Company of New York. For the purposes of the Agreement, a
"Subject Share" includes, in the event of any spinoff or other distribution by
The Limited to its stockholders of any business controlled by The Limited, in
addition to a share of Common Stock of The Limited, such security (or portion
thereof) as the Trust may receive in the spinoff or other distribution in
respect of each share of Common Stock.

Under the terms of the Agreement, the Trust has the right (the "Redemption
Right"), through January 30, 2006 (the "Exercise Period"), to require The
Limited to redeem the Subject Shares, from time to time, in whole or in part
(subject to specified minimum amounts), at a price per share equal to $18.75,
subject to certain adjustments (the "Redemption Price"). The Trust will have
the right to transfer the Redemption Right, from time to time, in whole or in
part, to (i) Mr. Wexner, (ii) any member of Mr. Wexner's immediate family,
(iii) any corporation, partnership, trust or other entity, of which all of the
owners or beneficiaries are Mr. Wexner or any member of Mr. Wexner's immediate
family or any charitable trust, (iv) any estate or personal representative of
Mr. Wexner or any member of Mr. Wexner's immediate family and (v) subject to
certain conditions, third parties, in each case, provided that such transferee
agrees to be bound by the terms of the Agreement. The Trust has the right to
pledge the Redemption Right to a financial institution reasonably satisfactory
to The Limited to

secure the Trust's obligations relating to borrowed money under any credit or
similar agreement. The Trust will be permitted to withdraw Subject Shares from
the custody account if the withdrawn shares are replaced by an amount in cash
equal to 120% of the market value of the withdrawn shares. The Trust will be
permitted to sell all of the withdrawn shares.

The Limited will have the right (the "Company Redemption Right"), beginning
on July 31, 2006 and ending on January 30, 2007, to redeem the Subject Shares,
from time to time, in whole or in part (subject to specified minimum amounts),
at a price per share equal to $25.07, subject to certain adjustments (also
referred to as the "Redemption Price"). The Limited has the right to transfer
the Company Redemption Right, from time to time, in whole or in part, to any
affiliate. The Company Redemption Right will be reduced on a share-for-share
basis for any Subject Shares redeemed by The Limited pursuant to the
Redemption Right.

Subject to the terms of the Agreement, certain adjustments will be made to
the number of shares of Common Stock subject to the Redemption Right and the
Company Redemption Right or to the Redemption Price, as the case may be, upon
the following events: (i) the payment of a dividend in shares, or any
subdivision, split or reclassification of shares of Common Stock; (ii) the
issuance of shares of Common Stock (or rights, warrants or other securities
convertible into or exchangeable or exercisable for shares of Common Stock) to
all holders of shares of Common Stock at a price less than its market price;
(iii) the repurchase of shares of Common Stock at a price in excess of its
market price; or (iv) any change, reclassification, conversion or other
similar transaction involving shares of Common Stock.

During fiscal year 1998, Leonard A. Schlesinger, a member of the Board of
Directors, provided consulting services to The Limited. The fees for such
services were approximately $255,950.

EXECUTIVE COMPENSATION

Summary compensation table

The following table (the "Summary Compensation Table") shows the
compensation paid by The Limited to each of the named executive officers of
The Limited for each of our last three fiscal years.

Long-Term
Annual Compensation Compensation Awards
---------------------------------- --------------------------
Other Securities
Annual Restricted Underlying All Other
Name and Principal Fiscal Compen- Stock Options Compen-
Position (1) Year Salary ($) Bonus ($)(2) sation ($) Awards ($)(4) Awarded (#) sation ($)(5)
------------------ ------ ---------- ------------ ---------- ------------- ------------ -------------

Leslie H. Wexner ....... 1998 $1,046,154 $1,519,392 -- $ 29,316 203,540 (6) $154,706
Chairman of the Board, 1997 1,000,000 1,861,560 -- -- 1,628,320 (6) 135,296
Chief Executive Officer 1996 1,011,538 915,000 -- -- 203,540 (6) 151,629
and President 100,000 (7)

Kenneth B. Gilman ...... 1998 936,923 935,150 $14,955(3) 158,304 -- 277,290
Vice Chairman and 1997 900,000 1,228,630 -- 6,220,313 508,850 (6) 195,094
Chief Administrative 1996 903,846 603,900 -- -- 50,855 (6) 187,192
Officer 50,000 (7)

Martin Trust............ 1998 727,692 1,460,000 85,966(3) 137,899 -- 336,771
President and Chief 1997 700,000 868,980 -- 3,900,000 305,310 (6) 216,212
Executive Officer of 1996 703,846 1,155,700 -- 518,809 61,062 (6) 203,807
Mast Industries, Inc

Arnold F. Kanarick...... 1998 573,077 364,021 57,617(3) 93,843 -- 196,016
Executive Vice 1997 546,154 477,800 19,538 2,925,000 254,424 (6) 99,089
President and Chief 1996 497,308 255,500 -- 120,218 30,531 (6) 79,833
Human Resources Officer 20,000 (7)

V. Ann Hailey........... 1998 517,307 332,367 -- 2,791,669 203,540 (6) 14,215
Executive Vice 1997 204,327 258,825 32,984 990,625 25,443 (6) 276,099
President and Chief
Financial Officer

- --------
(1) Ms. Hailey joined The Limited on August 11, 1997 as Executive Vice
President and Chief Financial Officer; therefore, amounts disclosed for
fiscal 1997 are for partial year.

(2) Represents for each fiscal year, the aggregate of the performance-based
incentive compensation for the Spring and Fall selling seasons.

(3) Represents for the 1998 fiscal year, reimbursement of taxes on life
insurance premiums paid on behalf of executive officers Gilman, Trust and
Kanarick.

(4) Represents for each executive officer, the restricted stock awards for the
specified fiscal year under The Limited's 1993 Stock Option and
Performance Incentive Plan. Information set forth above is based on the
closing price of The Limited's Common Stock on the date on which the
awards were made.

On June 1, 1998, 885, 4,779, 4,163, 2,833 and 2,390 restricted shares of The
Limited's Common Stock were granted to executive officers Wexner, Gilman,
Trust, Kanarick and Hailey, respectively. The per share value of the Common
Stock on such date was $33.125. These awards were made in connection with
the distribution in 1998 of the Abercrombie & Fitch shares to The Limited's
stockholders. The vesting of these awards is the same as the vesting of the
previously granted restricted stock awards to which these adjustment grants
relate.

On February 2, 1998, 100,000 restricted shares of The Limited's Common Stock
were granted to Ms. Hailey. The per share value of The Limited's Common
Stock on such date was $27.125. This award is earned subject to established
financial performance measures and once earned, vests 10%, 10%, 10%, 15%,
20% and 35% on the first through sixth anniversaries of the grant date,
respectively, subject to continued employment with The Limited.

On February 1, 1998, 7,500 restricted shares of The Limited's Common Stock
were granted to Ms. Hailey based on business performance for the fiscal
1997 year. The per share value of the Common Stock on the most recent prior
date on which there were sales (January 30, 1998) was $26.50. This award
vests 10% on the grant date and 20%, 30% and 40% on the first through third
anniversaries of the grant date, respectively, subject to continued
employment with The Limited.

On August 11, 1997, 35,000 restricted shares of The Limited's Common Stock
were granted to Ms. Hailey. The per share value of the Common Stock on such
date was $22.625. This award is earned subject to established financial
performance measures and once earned, vests 100% five years from the date
of grant, subject to continued employment with The Limited.

On May 20, 1997, 300,000, 200,000 and 150,000 restricted shares of The
Limited's Common Stock were granted to executive officers Gilman, Trust and
Kanarick, respectively. The per share value of the Common Stock on such
date was $19.50. These awards are earned subject to established financial
performance measures and once earned, vest 10%, 10%, 10%, 15%, 20% and 35%
on the first through sixth anniversaries of the grant date, respectively,
subject, in each case, to the holder's continued employment with The
Limited.

On March 25, 1997, 19,750 restricted shares of The Limited's Common Stock
were granted to Mr. Gilman. The per share value of the Common Stock on such
date was $18.75. This award vested 100% one year from the date of grant.

On February 1, 1997, 21,712 and 7,020 restricted shares of The Limited's
Common Stock were awarded for fiscal 1996 business performance to executive
officers Trust and Kanarick, respectively. The per share value of the
Common Stock on such date was $17.125. On August 1, 1996, 7,538 restricted
shares of The Limited's Common Stock were awarded for fiscal 1996 business
performance to Mr. Trust. The per share value of The Limited's Common Stock
on such date was $19.50. These awards vest 10% on the award date and 20%,
30%, and 40% on the first through third anniversaries of the award date,
respectively, subject, in each case, to the holder's continued employment
with The Limited.

Dividends will not be paid or accrue with respect to shares of restricted
stock until such shares vest.

As of January 30, 1999, the aggregate restricted stock holdings and the
value of such holdings for each of the named executive officers were: Mr.
Wexner, 50,885 shares, $1,736,451; Mr. Gilman, 274,779 shares, $9,376,833;
Mr. Trust, 207,106 shares, $7,067,492; Mr. Kanarick, 167,747 shares,
$5,724,366; and Ms. Hailey, 144,140 shares, $4,918,778 (based on the
$34.125 fair market value of a share of The Limited's Common Stock as of
Friday, January 29, 1999).

(5) Includes employer matching and supplemental contributions allocated to
each executive officer's account under certain of The Limited's qualified
and non-qualified defined contribution plans during the year in the

amount of $154,706, $261,165, $234,028, $130,233 and $10,300 for executive
officers Wexner, Gilman, Trust, Kanarick and Hailey, respectively.

Includes term life insurance premiums in the amount of $16,125, $96,940 and
$62,933 paid on behalf of executive officers Gilman, Trust and Kanarick,
respectively.

Includes one-time cash payment related to the Abercrombie & Fitch spin-off
in the amount of $5,803, $2,850 and $3,915 to executive officers Trust,
Kanarick and Hailey, respectively.

(6) Denominated in shares of The Limited's Common Stock. Options have been
adjusted to reflect the spin-off of Abercrombie & Fitch in May 1998.

(7) Denominated in shares of Intimate Brands' Class A Common Stock.

Long-term incentive plan awards

The Limited did not grant any awards for the 1998 fiscal year to the named
executive officers except for the restricted stock performance awards as
disclosed in the Summary Compensation Table.

Stock options

The following table shows certain information regarding stock options
granted to the executive officers named in the Summary Compensation Table
during our 1998 fiscal year.

Option Grants in Fiscal Year 1998

Individual Grants (1)
------------------------------------------------------- Potential Realizable Value at
Approximate % Assumed Annual Rates of Stock
Securities of Total Options Price Appreciation for
Underlying Granted to Option Term (2)
Options Associates in Exercise Price Expiration ------------------------------
Name Granted (#) Fiscal Year Per Share ($) Date 5% ($) 10% ($)
---- ----------- ---------------- -------------- ---------- -------------- ---------------

Leslie H. Wexner........ 203,540 4.82% $29.3186 (3) 02/02/08 $ 3,025,656 $ 8,352,603
Kenneth B. Gilman....... -- -- -- -- -- --
Martin Trust............ -- -- -- -- -- --
Arnold F. Kanarick...... -- -- -- -- -- --
V. Ann Hailey........... 203,540 4.82% 26.6532 02/02/08 3,568,159 8,895,098

- --------
(1) On February 2, 1998, options were granted to Mr. Wexner and Ms. Hailey
pursuant to The Limited's 1993 Stock Option and Performance Incentive Plan
(1998 Restatement). Such options vest 10%, 10%, 10%, 15%, 20% and 35% on
the first through sixth anniversaries of the grant date, respectively,
subject, in each case, to the holder's continued employment with The
Limited.

The number of options and the exercise price have been adjusted to reflect
the spin-off of Abercrombie & Fitch in May 1998.

(2) The assumed rates of growth were selected by the Commission for
illustrative purposes only and are not intended to predict or forecast
future stock prices.

(3) The per share exercise price of options granted to Mr. Wexner was set at
110% of the fair market value of the stock on the date of grant.

The following table shows certain information about stock options exercised
by the executive officers named in the Summary Compensation Table during The
Limited's 1998 fiscal year and the year-end values of unexercised options held
by those executive officers.

Aggregated Option Exercises in 1998 Fiscal Year
and Fiscal Year-End Option Values

Number of Securities
Underlying Unexercised Value of Unexercised
Options at Fiscal In-the-Money Options at
Year-End (#) Fiscal Year-End ($)
--------------------------- ----------------------------
Shares
Acquired on Value
Name Exercise (#) Realized ($)(1) Exercisable Unexercisable Exercisable Unexercisable
---- ------------ --------------- ----------- ------------- ----------- -------------

Leslie H. Wexner........ -- -- 391,813 (2) 1,796,242 (2) $5,631,146 (2) $20,978,692 (2)
50,000 (3) 50,000 (3) 914,375 (3) 914,375 (3)
Kenneth B. Gilman....... 64,049 $894,186 234,899 (2) 502,490 (2) 3,341,148 (2) 7,639,625 (2)
12,501 (3) 37,499 (3) 321,901 (3) 965,599 (3)
Martin Trust............ -- -- 145,530 (2) 325,665 (2) 2,066,107 (2) 5,012,662 (2)
Arnold F. Kanarick...... -- -- 115,761 (2) 255,699 (2) 1,618,824 (2) 3,898,497 (2)
5,000 (3) 15,000 (3) 128,750 (3) 386,250 (3)
V. Ann Hailey........... -- -- 6,360 (2) 222,623 (2) 75,643 (2) 1,747,774 (2)

- --------
(1) Calculated on the basis of the number of shares exercised, multiplied by
the excess of the fair market value of a share of Common Stock on the date
of exercise over the exercise price of such option.

(2) Denominated in shares of The Limited's Common Stock. Value is calculated
on the basis of the number of shares subject to each such option,
multiplied by the excess of the fair market value of a share of The
Limited's Common Stock on the last trading day prior to fiscal year-end
($34.125) over the exercise price of such option.

Options have been adjusted to reflect the spin-off of Abercrombie & Fitch
in May 1998.

(3) Denominated in shares of Intimate Brands' Class A Common Stock. Value is
calculated on the basis of the number of shares subject to each such
option, multiplied by the excess of the fair market value of a share of
Intimate Brands' Class A Common Stock on the last trading day prior to
fiscal year-end ($39.875) over the exercise price of such option.

Compensation of directors

Associates and officers who are directors receive no additional compensation
for their service as directors. We provide the following compensation to our
directors who are not associates of The Limited for their services as
directors:

. An annual retainer of $20,000 per year (increased by $4,000 for each
committee chair held), plus

. a fee of $3,500 for each Board meeting attended ($1,000 for a
telephonic meeting) and, as committee members, a fee of $1,500 per
committee meeting attended ($500 for a telephonic meeting) and

. a fee of $500 for each action in writing taken by the Board or any
committee.

Under The Limited's 1996 Stock Plan for Non-Associate Directors, each
director who is not an associate of The Limited receives (i) annual grants of
options to purchase 1,000 shares of The Limited's Common Stock at a price
equal to the fair market value of such shares at the date of grant and (ii)
50% of the annual retainer in shares of The Limited's Common Stock.

Employment agreements with certain executive officers

In 1998 the Company entered into an employment agreement with Ms. Hailey
under which she will continue to serve as the Company's Executive Vice
President and Chief Financial Officer. The initial term of Ms. Hailey's
agreement is six years, with automatic one-year extensions thereafter unless
either party gives written notice to the contrary. Ms. Hailey's agreement
provides for an initial base salary of $525,000, the grant of options to
purchase 200,000 shares of The Limited's Common Stock, rights to receive,
based on Company performance and continued employment, 100,000 shares of The
Limited's Common Stock, incentive plan participation as determined by the
Board, life insurance coverage of $5 million and disability benefits in
addition to the benefits available under the Company's disability plans. Ms.
Hailey's agreement also provides that, if the Company fails to extend the
agreement or terminates Ms. Hailey's employment without cause, or if she
terminates her employment for good reason, she will continue to receive her
base salary for one year after the termination date. In the event any
"parachute" excise tax is imposed on Ms. Hailey, she will be entitled to tax
reimbursement payments.

In 1997 the Company entered into individual employment agreements with
Messrs. Gilman, Trust and Kanarick. Under these agreements, Mr. Gilman will
continue to serve as the Company's Vice Chairman and Chief Administrative
Officer, Mr. Trust will continue to serve as President and Chief Executive
Officer of Mast Industries, Inc. and Mr. Kanarick will continue to serve as
the Company's Executive Vice President and Chief Human Resources Officer. The
initial term of each agreement is six years, with automatic one-year
extensions thereafter unless either party gives written notice to the
contrary. Mr. Gilman's agreement provides for an initial base salary of
$900,000 and the grant of options to purchase 500,000 shares of The Limited's
Common Stock and rights to receive, based on Company performance and continued
employment, 300,000 shares of The Limited's Common Stock. Mr. Trust's
agreement provides for an initial base salary of $700,000 and the grant of
options to purchase 300,000 shares of The Limited's Common Stock and rights to
receive, based on Company performance and continued employment, 200,000 shares
of The Limited's Common Stock. Mr. Kanarick's agreement provides for an
initial base salary of $550,000 and the grant of options to purchase 250,000
shares of The Limited's Common Stock and rights to receive, based on Company
performance and continued employment, 150,000 shares of The Limited's Common
Stock. Each agreement also provides for incentive plan participation as
determined by the Board and life insurance coverage of $5 million. Each
agreement provides that, if the Company fails to extend the agreement or
terminates the executive's employment without cause, or if the executive
terminates his employment for good reason, the executive will continue to
receive his base salary for one year after the termination date. Each
executive's agreement provides for disability benefits in addition to the
benefits available under the Company's disability plans. In the event any
"parachute" excise tax is imposed on an executive, he will be entitled to tax
reimbursement payments.

Section 16(a) beneficial ownership reporting compliance

The Limited's officers and directors, and persons who own more than ten
percent of a registered class of The Limited's equity securities, must file
reports of ownership and changes in ownership of The Limited's equity
securities with the Commission and the New York Stock Exchange. Copies of
those reports must also be furnished to The Limited.

Based solely on a review of the copies of reports furnished to The Limited
and written representations that no other reports were required, we believe
that during fiscal 1998 our officers, directors and greater than ten-percent
beneficial owners complied with these filing requirements.

REPORT OF THE COMPENSATION COMMITTEE

The Compensation Committee (the "Committee") reviews and approves The
Limited's compensation philosophy and policies and the application of such
policies to the compensation of Mr. Wexner and other executive officers. We
and the Committee have also retained independent compensation consultants to
assist in developing, and periodically assessing the effectiveness and
reasonableness of, our executive officer compensation program.

Compensation philosophy

We attempt to apply a consistent philosophy to compensation for all
leadership associates, including senior executives. The primary goal of the
compensation program has moved toward linking total executive compensation to
performance that enhances stockholder value. Accordingly, we have structured
total compensation for leadership individuals so that a lower proportion is
fixed compensation and a much higher variable proportion is keyed to business
and stock performance.

Our philosophy is based on the following basic principles:

. To Pay for Outstanding Performance.

We believe in paying for results. Individuals in leadership roles are
compensated based on a combination of total company, business unit and
individual performance factors. Total company and business unit performance
are evaluated primarily on the degree by which financial targets are met.
Individual performance is evaluated based upon several leadership factors,
including building brand identity, attainment of specific merchandise and
financial objectives, building and developing a strong leadership team,
developing an infrastructure to support future business growth and
controlling expenses. In addition, a significant portion of total
compensation is in the form of equity-based award opportunities to directly
tie any increased compensation to increased stockholder value.

. To Pay Competitively.

We are committed to providing a total compensation program designed to
attract the best senior leaders to the business and to retain the best,
consistently highest performers. To achieve this goal, we annually compare
our pay practices and overall pay levels with other leading retail and
where appropriate, non-retail companies, and set pay guidelines based on
this review.

. To Pay Equitably.

We believe that it is important to apply generally consistent guidelines
for all leadership compensation programs across business units, considering
the size, complexity, stage of development and performance of the business,
and the performance of each individual executive.

Principal compensation elements

The principal elements of executive compensation at The Limited are base
salary, short-term performance-based cash incentive compensation and long-term
equity-based incentive programs. In determining guidelines for each
compensation element, we participate in compensation surveys which include
approximately 75 national and regional specialty and department store retail
businesses, chosen because of their general similarity to The Limited in
business and merchandise focus. In addition, we participate in special surveys
focusing on specific

segments of the business, such as merchandise design and the personal care
products business. With the help of our compensation consultants, we analyze
executive compensation levels and practices relative to the performance of
these competitor companies and, from this information, develop pay guidelines
that generally target The Limited's executive pay well above the industry
survey median for those executives with exceptional performance. The
competitor group that is surveyed is subject to periodic review and is
modified from time to time to reflect new businesses, mergers, acquisitions
and changes in business focus. The competitor group that we use for this
purpose contains approximately 50% of the companies in the S&P Retail Stores
Composite Index represented in the Stockholder Return Graph below. Subject to
our needs, we generally attempt to design all incentive and equity-based
compensation programs to meet the requirements of deductibility under the
Internal Revenue Code of 1986, as amended (the "Code").

Base salary.

The Committee annually reviews and approves the base salary of each
executive officer and business president. In determining salary adjustments,
the Committee considers the size and responsibility of the individual's
position, the business unit's overall performance, the individual's overall
performance and future potential and the base salaries paid by competitors to
employees in comparable positions. Individual performance is measured against
the following factors: seasonal and annual business goals, brand strategy
execution and business growth goals, and the recruitment and development of
leadership talent. These factors are considered subjectively in the aggregate,
and none of these factors is accorded a formula weight.

In 1998, the base salaries of Messrs. Wexner, Gilman, Trust and Kanarick
increased 4% to 5%, with continued increased emphasis placed on performance-
based cash and equity incentive compensation. Ms. Hailey entered into the six
year employment agreement described above, with her base salary increasing
from $425,000 to $525,000 per year.

Performance-based cash incentive compensation.

The Limited has implemented a short-term performance-based cash incentive
compensation program for specified key leadership positions that provides for
incentive payments for each six-month operating season. These incentive
payments are based on the attainment of pre-established objective financial
goals.

For most businesses, the goals under this plan are based on operating
income. However, goals also may be based on other objectives or criteria,
depending on the business unit and its strategy. We set these goals at the
beginning of each six-month season, and base them on an analysis of historical
performance and growth expectations for that business, financial results of
other comparable businesses both inside and outside The Limited, and progress
toward achieving the strategic plan for that business. Annually, we establish
target cash incentive compensation opportunities for eligible executives
stated as a specific percent of base salary. The amount of performance-based
incentive compensation earned by participating executives can range from zero
to double their incentive target, based upon the extent to which the pre-
established financial goals are achieved.

Equity-based incentive programs.

The Committee believes that continued emphasis on equity-based compensation
opportunities encourages performance that enhances stockholder value, thereby
further linking leadership and shareholder objectives. In 1998, continuing a
program that began in 1993, the Committee awarded equity-based incentive
compensation under two programs: a stock option program, and a restricted
stock program under which shares of stock are

earned based on attainment of specified financial performance objectives. The
Committee also believes that stock awards, the vesting of which is subject to
continued employment, help us to retain key high performing executives.

Award opportunities for each eligible participant are based on guidelines
which include size of the executive's business unit, the individual's
responsibility level within that business, competitive practice and the market
price of The Limited's Common Stock. In determining the awards for an
executive officer, the Committee evaluated competitive practice and the
executive officer's performance and importance to the business.

Stock options.

In 1998, stock options were awarded to Mr. Wexner and Ms. Hailey in the
amounts set forth in the Option Grants in Fiscal Year 1998 table above. The
options granted to both Mr. Wexner and Ms. Hailey vest, subject to continued
employment, on a graduated basis over a period of six years. The exercise
price for Mr. Wexner's options were granted at 10% above the fair market value
of the underlying common stock on the date of grant. The exercise price for
Ms. Hailey's options is equal to the fair market value of the underlying
common stock on the date of grant.

Performance-based restricted stock.

In 1998, with the exception of Messrs. Wexner, Gilman, Trust, Kanarick and
Ms. Hailey, the Committee continued a program commenced in 1994 under which
specific key executives are eligible to receive restricted stock based on the
achievement of pre-established financial goals. Through this program,
executives can earn from zero to double their targeted number of restricted
shares based upon the extent to which financial goals are achieved. In 1998,
restricted stock awards were made to Messrs. Wexner, Gilman, Trust, Kanarick,
and Ms. Hailey in connection with the distribution in 1998 of the Abercrombie
& Fitch shares to The Limited's stockholders. In addition, Ms. Hailey was also
granted restricted shares in connection with her employment agreement with The
Limited.

CEO compensation

Mr. Wexner has been Chief Executive Officer and President since founding The
Limited in 1963. The Limited conducts the same type of competitive review and
analysis to determine base salary and incentive guidelines for Mr. Wexner's
position as it does for the other executive positions.

In 1998, as in prior years, in establishing Mr. Wexner's compensation
package the Committee considered competitive practices, the extent to which
The Limited achieved operating income and sales objectives, progress regarding
brand strategy, and the continued recruitment and development of leadership
talent for the business. These factors are considered subjectively in the
aggregate and none of these factors is accorded specific weight.

As described earlier, the Committee and The Limited continue to emphasize
variable, performance-based compensation components for all executives,
including Mr. Wexner. Accordingly, Mr. Wexner's base salary increased by 5%,
from $1,000,000 to $1,050,000, and his annual performance-based cash incentive
compensation target increased from 150% to 160% of base salary. In addition,
Mr. Wexner was granted options covering 200,000 shares of The Limited's Common
Stock (203,540, as adjusted) with an exercise price set at a 10% premium over
the fair market value of the price of the stock on the date of grant. In
establishing these compensation elements, the Committee favorably viewed Mr.
Wexner's significant achievements in recruiting

and developing senior leadership, refocusing the company on the core business
units, including the successful spin-off of the Abercrombie & Fitch business,
improving financial results and shareholder value, and making significant
progress on the brand development strategy of the business units.

In fiscal 1998 The Limited posted net sales of $9.19 billion, an increase of
6% compared to fiscal 1997 net sales, excluding Abercrombie & Fitch sales in
both years, with adjusted net income of $342.4 million, which was 15% above
comparable adjusted net income for fiscal 1997, and adjusted earnings per
share of $1.46 per share, which was an 11% increase over 1997 adjusted
earnings per share. These annual results were slightly below targeted
performance objectives established by the Committee, and as a result, the
annual cash incentive payment earned by Mr. Wexner was slightly below targeted
levels.

Compensation Committee

Donald B. Shackelford, Chair
E. Gordon Gee

STOCKHOLDER RETURN GRAPH

The following graph shows the changes, over the past five-year period, in
the value of $100 invested in Common Stock of The Limited, the Standard &
Poor's 500 Composite Stock Price Index and the Standard & Poor's Retail Stores
Composite Index. The plotted points represent the closing price on the last
day of the fiscal year indicated.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*

AMONG THE LIMITED, INC., THE S&P 500 INDEX
AND THE S&P RETAIL COMPOSITE INDEX

COMPARISON OF FIVE YEAR CUMULATIVE RETURNS*
AMONG THE LIMITED, INC., THE S&P 500 INDEX
AND THE S&P RETAIL COMPOSITE INDEX

1/31/94 1/31/95 1/31/96 1/31/97 1/30/98 1/29/99
------- -------- ------- ------- ------- -------

THE LIMITED, INC. $100 $ 97 $ 98 $102 $162 $216
S&P 500 INDEX $100 $ 98 $132 $163 $204 $266
S&P RETAIL COMPOSITE $100 $ 93 $ 99 $115 $172 $273

* $100 INVESTED IN STOCK OR IN INDEX AT THE CLOSING PRICE ON
1/31/94 - INCLUDING REINVESTMENT OF DIVIDENDS.

SHARE OWNERSHIP OF PRINCIPAL STOCKHOLDERS

The following table sets forth the names of all persons who, on February 28,
1999, were known by The Limited to be the beneficial owners (as defined in the
rules of the Commission) of more than 5% of the shares of Common Stock of The
Limited:

Amount
Beneficially Percent
Name and Address of Beneficial Owner Owned of Class
- ------------------------------------ ------------ --------

Leslie H. Wexner........ 58,625,235 25.8%
Three Limited Parkway
P.O. Box 16000
Columbus, Ohio 43216
FMR Corp.(1) ........... 13,343,906 5.9%
c/o Michele L. Ferrie
82 Devonshire Street
Boston, Massachusetts
02109-3614
Capital Research and 14,421,900 6.4%
Management Company(2)..
333 South Hope Street
Los Angeles, California
90071

- --------
(1) FMR Corp., Edward C. Johnson 3d, Abigail P. Johnson and certain
subsidiaries of FMR Corp. may be deemed to be members of a "group" as such
term is defined in the rules promulgated by the Commission. FMR Corp. is
the beneficial holder of The Limited's Common Stock as a result of the
investment-related activities of certain subsidiaries of FMR Corp. Members
of the Edward C. Johnson 3d family and trusts for their benefit are the
predominant owners of Class B shares of common stock of FMR Corp.,
representing approximately 49% of its voting power. Mr. Johnson 3d, the
chairman of FMR Corp., owns 12% of the aggregate outstanding voting stock
of FMR Corp. and Ms. Johnson, a director of FMR Corp., owns 24.5% of the
aggregate outstanding voting stock of FMR Corp.

(2) Capital Research and Management Company, an investment adviser registered
under Section 203 of the Investment Advisers Act of 1940, is deemed to be
the beneficial owner of 14,421,900 shares of The Limited's Common Stock as
a result of acting as investment adviser to various investment companies
registered under Section 8 of the Investment Company Act of 1940.

INDEPENDENT PUBLIC ACCOUNTANTS

During The Limited's 1998 fiscal year, PricewaterhouseCoopers LLP served as
our independent public accountants and in that capacity rendered an opinion on
our consolidated financial statements as of and for the fiscal year ended
January 30, 1999. We annually review the selection of our independent public
accountants, but we have not yet selected one for the current fiscal year.

Representatives of PricewaterhouseCoopers LLP are expected to be present at
the annual meeting. They will be available to respond to appropriate questions
and may make a statement if they so desire.

OTHER MATTERS

The Board of Directors knows of no other matters to be brought before the
annual meeting. However, if other matters should come before the meeting, each
of the persons named in the proxy intends to vote in accordance with his
judgment on such matters.

STOCKHOLDER PROPOSALS

We may omit from the Proxy Statement and form of proxy relating to the next
annual meeting of stockholders any proposals of stockholders which are
intended to be presented at that meeting which are not received by the
Secretary of The Limited at our principal executive offices on or before
December 16, 1999.

SOLICITATION EXPENSES

We will pay the expense of preparing, assembling, printing and mailing the
proxy form and the form of material used in solicitation of proxies. Our
employees may solicit proxies by telephone, mailgram, facsimile, telegraph,
cable and personal interview, in addition to the use of the mails. We have
retained Shareholder Communications Corporation, New York, New York, to help
us solicit proxies relating to shares held by brokerage houses, custodians,
fiduciaries and other nominees for a fee of approximately $20,000, plus
expenses. We do not expect to pay any other compensation for the solicitation
of proxies.

By Order of the Board of Directors
/s/ Leslie H. Wexner
Leslie H. Wexner
Chairman of the Board

P R O X Y

s FOLD AND DETACH HERE s
THE LIMITED, INC.
This Proxy is Solicited by the Board of Directors
Annual Meeting of Stockholders
May 17, 1999

The undersigned hereby appoints Leslie H. Wexner and Kenneth B. Gilman, and
each of them, proxies, with full power of substitution, to vote for the
undersigned all shares of Common Stock of The Limited, Inc. which the
undersigned would be entitled to vote if personally present at the Annual
Meeting of Stockholders to be held on May 17, 1999 at 9:00 a.m., Eastern
Daylight Time, and at any adjournments thereof, upon the matters described in
the accompanying Proxy Statement and upon any other business that may properly
come before the meeting or any adjournments thereof.

Election of Directors, Nominees:

1. Leonard A. Schlesinger, 2. Donald B. Shackelford, 3. Martin Trust,
4. Raymond Zimmerman

SAID PROXIES ARE DIRECTED TO VOTE AS MARKED ON THE REVERSE SIDE AND IN THEIR
DISCRETION UPON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING OR
ANY ADJOURNMENTS THEREOF.
(Continued and to be signed on the reverse side)

9788

[X] Please mark your
votes as in this
example.

The Board of Directors recommends a vote "FOR" each of the named nominees.
If no specification is indicated, the shares represented by this proxy will be
voted as recommended by the Board.

1. Election of FOR WITHHELD
Directors (see reverse) [_] [_]

For, except vote withheld from following nominee(s):

- -------------------------------------------------------------------------------

The undersigned acknowledges receipt with this Proxy of a copy of the Notice of
Annual Meeting of Stockholders and Proxy Statement dated April 14, 1999.

IMPORTANT: Please date this Proxy and sign exactly as your name or names appear
hereon. If stock is held jointly, signature should include both names. Execu-
tors, Administrators, Trustees, Guardians and others signing in a representa-
tive capacity should indicate full titles.

SIGNATURE(S) DATE

. FOLD AND DETACH HERE .

The Limited, Inc.

Dear Stockholder:

The Limited, Inc. encourages you to take advantage of new and convenient ways
by which you can vote your shares. You can vote your shares electronically
through the Internet or by telephone. This eliminates the need to return your
proxy card.

To vote your shares electronically, you must use the control number printed in
the box above, just below the perforation. The series of numbers that appear
in the box above must be used to access the system.

1. To vote over the Internet:
. Log on to the Internet and go to the web site http://www.vote-by-net.com.

2. To vote by telephone:
. On a touch-tone telephone, call 1-800-OK2-VOTE (1-800-652-8683) 24
hours a day, 7 days a week.

Your electronic vote authorizes the named proxies in the same manner as if you
marked, signed, dated and returned the proxy card.

If you choose to vote your shares electronically, there is no need to mail
back your proxy card.

Your vote is important. Thank you for voting.

PROXY

THE LIMITED, INC.
This Proxy is Solicited by the Board of Directors
Annual Meeting of Stockholders
May 17, 1999
The Board of Directors recommends a vote "FOR" each of the named nominees. If
no specification is indicated, the shares represented by this proxy will be
voted as recommended by the Board.

Election of Directors, Nominees:
Leonard A. Schlesinger, Donald B. Shackelford, Martin Trust, Raymond Zimmerman.

1. Election of Directors
FOR WITHHELD
[_] [_]
For, except vote withheld from following nominee(s):
- -------------------------------------------------------------------------------

(Continued and to be signed on the reverse side)

The undersigned acknowledges receipt with this Proxy of a copy of the Notice
of Annual Meeting of Stockholders and Proxy Statement dated April 14, 1999.

SIGNATURE(S) ________________ DATE

IMPORTANT: Please date this Proxy and
sign exactly as your name or names
appear hereon. If stock is held
jointly, signature should include both
names. Executors, Administrators,
Trustees, Guardians and others signing
in a representative capacity should
indicate full titles.