Exhibit 10.8(11)

                                           SIERRA HEALTH SERVICES, INC.

                                            DEFERRED COMPENSATION PLAN

                                         Effective May 1, 1996, as Amended
                                           and Restated January 1, 2000




























<PAGE>


<TABLE>

                                                 TABLE OF CONTENTS

<CAPTION>

                                                                                                               Page

<S>                                                                                                               <C>
Purpose .......................................................................................................   1

ARTICLE 1         Definitions..................................................................................   1

ARTICLE 2         Selection, Enrollment, Eligibility...........................................................   6

         2.1      Selection by Committee.......................................................................   6
         2.2      Enrollment Requirements......................................................................   7
         2.3      Eligibility; Commencement of Participation...................................................   7
         2.4      Termination of Participation and/or Deferrals................................................   7

ARTICLE 3         Deferral Commitments/Company Matching/Crediting/Taxes........................................   7

         3.1      Minimum Deferral.............................................................................   7
         3.2      Maximum Deferral.............................................................................   8
         3.3      Election to Defer; Effect of Election Form...................................................   8
         3.4      Withholding of Annual Deferral Amounts.......................................................   9
         3.5      Annual Company Matching Amount...............................................................   9
         3.6      Annual Company Restoration Amount...........................................................   10
         3.7      Vested Company Matching Account, Vested Company
                           Restoration Account, and Deferral Account...........................................  10
         3.8      Crediting/Debiting of Account Balances.......................................................  10
         3.9      FICA, Withholding and Other Taxes............................................................  12
         3.10     Rollovers From Prior Deferred Compensation Plan..............................................  13

ARTICLE 4         Short-Term Payout; Unforeseeable Financial Emergencies;
                           Withdrawal Election.................................................................  13

         4.1      Short-Term Payout............................................................................  13
         4.2      Other Benefits Take Precedence Over Short-Term Payout........................................  13
         4.3      Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies........................  14
         4.4      Withdrawal Election..........................................................................  14

ARTICLE 5         Retirement Benefit...........................................................................  14

         5.1      Retirement Benefit...........................................................................  14
         5.2      Payment of Retirement Benefit................................................................  14
         5.3      Death Prior to Completion of Retirement Benefit..............................................  15




<PAGE>



ARTICLE 6         Pre-Retirement Survivor Benefit..............................................................  15

         6.1      Pre-Retirement Survivor Benefit..............................................................  15
         6.2      Payment of Pre-Retirement Survivor Benefit...................................................  15

ARTICLE 7         Termination Benefit..........................................................................  15

         7.1      Termination Benefit..........................................................................  15
         7.2      Payment of Termination Benefit...............................................................  15

ARTICLE 8         Disability Waiver and Benefit................................................................  16

         8.1      Disability Waiver............................................................................  16
         8.2      Continued Eligibility; Disability Benefit....................................................  16

ARTICLE 9         Beneficiary Designation......................................................................  17

         9.1      Beneficiary..................................................................................  17
         9.2      Beneficiary Designation; Change; Spousal Consent.............................................. 17
         9.3      Acknowledgment...............................................................................  17
         9.4      No Beneficiary Designation...................................................................  17
         9.5      Doubt as to Beneficiary......................................................................  18
         9.6      Discharge of Obligations.....................................................................  18

ARTICLE 10        Leave of Absence; Consulting.................................................................  18

         10.1     Paid Leave of Absence........................................................................  18
         10.2     Unpaid Leave of Absence......................................................................  18
         10.3     Consulting Arrangements......................................................................  18

ARTICLE 11        Termination, Amendment or Modification.......................................................  19

         11.1     Termination..................................................................................  19
         11.2     Amendment....................................................................................  19
         11.3     Plan Agreement...............................................................................  20
         11.4     Effect of Payment............................................................................  20

ARTICLE 12        Administration...............................................................................  20

         12.1     Committee Duties.............................................................................  20
         12.2     Agents........................................................................................ 20
         12.3     Binding Effect of Decisions..................................................................  20
         12.4     Indemnity of Committee.......................................................................  20
         12.5     Employer Information.........................................................................  21




<PAGE>



ARTICLE 13        Other Benefits and Agreements................................................................  21

         13.1     Coordination with Other Benefits.............................................................  21

ARTICLE 14        Claims Procedures............................................................................  21

         14.1     Presentation of Claim........................................................................  21
         14.2     Notification of Decision.....................................................................  21
         14.3     Review of a Denied Claim.....................................................................  22
         14.4     Decision on Review...........................................................................  22
         14.5     Legal Action.................................................................................  22

ARTICLE 15        Trust........................................................................................  22

         15.1     Establishment of the Trust...................................................................  22
         15.2     Interrelationship of the Plan and the Trust..................................................  23
         15.3     Distributions From the Trust.................................................................  23

ARTICLE 16        Miscellaneous................................................................................  23

         16.1     Unsecured General Creditor...................................................................  23
         16.2     Employer's Liability.........................................................................  23
         16.3     Nonassignability.............................................................................  23
         16.4     Not a Contract of Employment.................................................................  24
         16.5     Furnishing Information.......................................................................  24
         16.6     Terms........................................................................................  24
         16.7     Captions.....................................................................................  24
         16.8     Governing Law................................................................................  24
         16.9     Notice.......................................................................................  24
         16.10    Successors...................................................................................  25
         16.11    Spouse's Interest............................................................................  25
         16.12    Validity.....................................................................................  25
         16.13    Incompetent..................................................................................  25
         16.14    Court Order..................................................................................  25
         16.15    Distribution in the Event of Taxation........................................................  25
         16.16    Legal Fees To Enforce Rights After Change in Control.........................................  26
</TABLE>


<PAGE>







                                           SIERRA HEALTH SERVICES, INC.

                                            DEFERRED COMPENSATION PLAN

                                         Effective May 1, 1996, as Amended
                                           and Restated January 1, 2000


                                                      Purpose

                  The purpose of this Plan is to provide specified benefits to a
select  group of  management  or highly  compensated  Employees  who  contribute
materially to the continued  growth,  development and future business success of
the Sierra Health  Services,  Inc., a Nevada  corporation,  and its subsidiaries
(including lower-tier  subsidiaries),  if any, that sponsor this Plan. This Plan
shall be unfunded for tax purposes and for purposes of Title I of ERISA.

                                                     ARTICLE 1
                                                    Definitions

                  For purposes hereof,  unless  otherwise  clearly apparent from
the context,  the following phrases or terms shall have the following  indicated
meanings:

1.1      "Account Balance" shall mean, with respect to a Participant, the sum of
         (i) the Deferral  Account plus (ii) the Vested Company Matching Account
         plus (iii) the Vested Company Restoration  Account.  This account shall
         be a  bookkeeping  entry only and shall be utilized  solely as a device
         for the  measurement and  determination  of the amounts to be paid to a
         Participant pursuant to this Plan.

1.2      "Annual Bonus" shall mean any annual cash  compensation  in addition to
         Base Annual Salary relating to services  performed  during any calendar
         year,  whether or not paid in such  calendar  year or  included  on the
         Federal  Income  Tax Form  W-2 for such  calendar  year,  payable  to a
         Participant  as an  Employee  under  any  Employer's  annual  bonus and
         incentive  plans,  including  any such  bonuses  payable  to  physician
         employees.

1.3      "Annual  Company  Matching  Amount"  for any one Plan Year shall be the
         amount determined in accordance with Section 3.5.

1.4      "Annual Company  Restoration Amount" for any one Plan Year shall be the
         amount determined in accordance with Section 3.6.

1.5      "Annual  Deferral  Amount"  shall mean that portion of a  Participant's
         Base Annual Salary  and/or  Annual Bonus that a  Participant  elects to
         have, and is, deferred in accordance with

                                                         1


<PAGE>



         Article  3,  for any one Plan  Year.  In the  event of a  Participant's
         Retirement,  Disability (if deferrals  cease in accordance with Section
         8.1),  death or a Termination of Employment  prior to the end of a Plan
         Year,  such year's  Annual  Deferral  Amount shall be the actual amount
         withheld prior to such event.

1.6    "Base Annual Salary" shall mean the annual cash  compensation  relating
         to services  performed during any calendar year, whether or not paid in
         such calendar  year or included on the Federal  Income Tax Form W-2 for
         such calendar year  including  bonuses  (other than the Annual  Bonus),
         commissions, and overtime, but excluding relocation expenses, incentive
         payments,  non-monetary awards, fringe benefits,  retainers,  directors
         fees and other fees,  severance  allowances,  pay in lieu of vacations,
         insurance premiums paid by an Employer,  insurance benefits paid to the
         Participant  or his  or  her  beneficiary,  Employer  contributions  to
         qualified or  nonqualified  plans and automobile  and other  allowances
         paid to a Participant for employment  services rendered (whether or not
         such  allowances  are included in the Employee's  gross  income).  Base
         Annual Salary shall be  calculated  before  reduction for  compensation
         voluntarily  deferred or contributed by the Participant pursuant to all
         qualified or  non-qualified  plans and shall be  calculated  to include
         amounts not otherwise included in the Participant's  gross income under
         Code Sections 125,  402(e)(3),  or 402(h) pursuant to plans established
         by any  Employer;  provided  however  that  all  such  amounts  will be
         included in  compensation  only to the extent  that,  had there been no
         such plan, the amount would have been payable in cash to the Employee.

1.7      "Beneficiary" shall mean one or more persons,  trusts, estates or other
         entities, designated in accordance with Article 9, that are entitled to
         receive benefits under this Plan upon the death of a Participant.

1.8      "Beneficiary  Designation  Form" shall mean the form,  established from
         time to time by the Committee, that a Participant completes,  signs and
         returns to the Committee to designate one or more Beneficiaries.

1.9      "Board" shall mean the board of directors of the Company.

1.10     "Change in Control" shall mean a transaction  or event in which,  after
         the  effective  date  of the  Plan,  (i) the  Company  shall  merge  or
         consolidate  with any other  corporation and shall not be the surviving
         corporation;  (ii) the Company shall transfer all or substantially  all
         of its  assets to any other  person;  or (iii) any  person  shall  have
         become the  beneficial  owner of more than 50% of the  voting  power of
         outstanding voting securities of the Company.

1.11     "Claimant" shall have the meaning set forth in Section 14.1.

     1.12 "Code"  shall mean the  Internal  Revenue  Code of 1986,  as it may be
          amended from time to time.

1.13     "Committee" shall mean the committee described in Article 12.

                                                         2


<PAGE>



     1.14  "Company"  shall  mean  Sierra  Health   Services,   Inc.,  a  Nevada
           corporation.

1.15  "Company   Matching   Account"  shall  mean  the  sum  of  all  of  a
Participant's  Annual Company Matching Amounts plus amounts credited and debited
in accordance  with all the applicable  crediting  provisions of this Plan, less
all distributions made to the Participant or his or her Beneficiary  pursuant to
this Plan that relate to his or her Company Matching Account. This account shall
be a  bookkeeping  entry only and shall be  utilized  solely as a device for the
measurement  and  determination  of the  amounts  to be paid to the  Participant
pursuant to this Plan.

     1.16  "Company  Restoration  Account"  shall  mean  the  sum  of  all  of a
Participant's  Annual  Company  Restoration  Amounts plus  amounts  credited and
debited in accordance  with all the applicable  provisions of the Plan, less all
distributions made to the Participant or his or her Beneficiary  pursuant to the
Plan that relate to his or her Company Restoration  Account.  This account shall
be a  bookkeeping  entry only and shall be  utilized  solely as a device for the
measurement  and  determination  of the  amounts  to be paid to the  Participant
pursuant to this Plan.

1.17     "Deferral Account" shall mean the sum of all of a Participant's  Annual
         Deferral Amounts,  plus amounts credited and debited in accordance with
         all the applicable  provisions of the Plan, less all distributions made
         to the Participant or his or her Beneficiary  pursuant to the Plan that
         relate  to  his  or her  Deferral  Account.  This  account  shall  be a
         bookkeeping entry only and shall be utilized solely as a device for the
         measurement  and  determination  of  the  amounts  to be  paid  to  the
         Participant pursuant to this Plan.

1.18     "Deduction Limitation" shall mean the following described limitation on
         a  benefit  that  may  otherwise  be  distributable   pursuant  to  the
         provisions of this Plan. Except as otherwise provided,  this limitation
         shall  be  applied  to  all  distributions  that  are  "subject  to the
         Deduction  Limitation"  under this Plan.  If an Employer  determines in
         good  faith  prior to a Change in Control  that  there is a  reasonable
         likelihood  that any  compensation  paid to a Participant for a taxable
         year of the Employer would not be deductible by the Employer  solely by
         reason of the limitation under Code Section 162(m),  then to the extent
         deemed  necessary by the  Employer to ensure that the entire  amount of
         any distribution to the Participant  pursuant to this Plan prior to the
         Change in  Control is  deductible,  the  Employer  may defer all or any
         portion  of a  distribution  under  this  Plan.  Any  amounts  deferred
         pursuant  to  this  limitation  shall  be  credited  and  debited  with
         additional  amounts in accordance with Section 3.8 below,  even if such
         amount is being  paid out in  installments.  The  amounts  so  deferred
         adjusted  to reflect  amounts  credited  and debited  thereon  shall be
         distributed to the  Participant or his or her Beneficiary (in the event
         of  the  Participant's   death)  at  the  earliest  possible  date,  as
         determined by the Employer in good faith, on which the deductibility of
         compensation paid or payable to the Participant for the taxable year of
         the Employer during which the  distribution is made will not be limited
         by Section  162(m),  or if earlier,  the effective  date of a Change in
         Control.  Notwithstanding anything to the contrary in this Plan,  the
         Deduction  Limitation shall not apply to any distributions made after a
         Change in Control.

                                                         3


<PAGE>



1.19     "Disability"   shall  mean  a  period  of  disability  during  which  a
         Participant  qualifies for disability  benefits under the Participant's
         Employer's  long-term  disability  plan, or, if a Participant  does not
         participate  in such a plan,  a period of  disability  during which the
         Participant  would have qualified for disability  benefits under such a
         plan  had  the  Participant  been a  participant  in  such a  plan,  as
         determined   in  the  sole   discretion  of  the   Committee.   If  the
         Participant's Employer does not sponsor such a plan, or discontinues to
         sponsor such a plan, Disability shall be determined by the Committee in
         its sole discretion.

1.20     "Disability Benefit" shall mean the benefit set forth in Article 8.

1.21     "Election  Form" shall mean the form  established  from time to time by
         the Committee  that a Participant  completes,  signs and returns to the
         Committee to make an election under the Plan.

1.22     "Employee" shall mean a person who is an employee of any Employer.

1.23     "Employer(s)"  shall mean the  Company  and/or any of its  subsidiaries
         (now in  existence  or  hereafter  formed or  acquired)  that have been
         selected by the Board to  participate  in the Plan and have adopted the
         Plan.

1.24     "ERISA" shall mean the Employee Retirement Income Security Act of 1974,
         as amended from time to time.

1.25     "401(k) Plan" shall be that certain Sierra Health Services, Inc. Profit
         Sharing/401(k)  Plan & Trust,  dated January 1, 1989 and adopted by the
         Company.

1.26     "Monthly  Installment  Method" shall be an  installment  payment method
         over the duration  selected by the  Participant in accordance with this
         Plan,  calculated as follows: The Participant's  Account Balance, as of
         the  date  of  the  Participant's  Retirement,   death,  Disability  or
         Termination  of  Employment,  shall be  multiplied  by a fraction,  the
         numerator of which is 1 and the  denominator  of which is the number of
         periods over which the  installment  payments shall be paid. The result
         of this multiplication  shall be the amount of each installment payment
         for the Plan Year in which the Participant  Retired,  died,  suffered a
         Disability or  experienced a Termination  of Employment and this amount
         shall be paid  starting  on the first day of the  month  following  the
         Participant's   Retirement,   death,   Disability  or   Termination  of
         Employment and shall continue to be paid on the first day of each month
         thereafter  during that Plan Year. For each subsequent Plan Year during
         the installment payment period, the Participant's Account Balance shall
         be determined  as of January 1 of that Plan Year,  in  accordance  with
         Section  3.8,  after  taking  into  account  all  previous  installment
         payments,  and  such  balance  shall  be  multiplied  by  the  fraction
         described  above,  except that the  denominator  shall be the number of
         remaining  periods over which the installment  payments are to be paid.
         The resulting  amount shall be the amount of each  installment  payment
         for the Plan Year,  which amount shall be paid on the first day of each
         month during the Plan Year. If a

                                                         4


<PAGE>



         Participant has a positive Account Balance after the end of the elected
         installment payment period, the remaining Account Balance shall be paid
         in a lump sum on the  first  day of the  month  following  the month in
         which the installment  period ends. If any installment,  if paid, would
         reduce  the  Participant's  Account  Balance  to  zero or  below,  that
         installment payment shall be reduced so that the Participant's  Account
         Balance  does not go below  zero and all  future  installment  payments
         shall cease.

1.27     "Participant"  shall  mean any  person  (i)  who,  as an  Employee,  is
         selected to participate in the Plan,  (ii) who elects to participate in
         the Plan,  (iii) who signs a Plan  Agreement,  an  Election  Form and a
         Beneficiary   Designation  Form,  (iv)  whose  signed  Plan  Agreement,
         Election  Form and  Beneficiary  Designation  Form are  accepted by the
         Committee,  (v) who commences participation in the Plan, and (vi) whose
         Plan  Agreement  has not  terminated.  A spouse or  former  spouse of a
         Participant  shall not be treated as a Participant in the Plan, even if
         he or she has an interest in the Participant's  benefits under the Plan
         under applicable law or as a result of property  settlements  resulting
         from legal separation or divorce.

1.28     "Plan" shall mean the Company's Deferred Compensation Plan, which shall
         be evidenced by this instrument and by each Plan Agreement, as they may
         be amended from time to time.

1.29     "Plan Agreement" shall mean a written agreement, as may be amended from
         time to time,  which is entered  into by and between an Employer  and a
         Participant.  The terms of any Plan Agreement may vary any of the terms
         set  forth in this  Plan  and such  changes  shall  be  binding  on the
         Employer  and the  Participant  if the Plan  Agreement is signed by the
         Participant and accepted by the Employer.  The Plan Agreement  executed
         by a  Participant  and accepted by the Employer  shall  provide for the
         entire  benefit to which such  Participant  is entitled under the Plan;
         should  there  be more  than  one Plan  Agreement,  the Plan  Agreement
         bearing the latest date of acceptance by the Employer  shall  supersede
         all previous  Plan  Agreements  in their  entirety and shall govern the
         agreement between the parties.

1.30     "Plan Year"  shall,  for the first Plan Year,  begin on May 1, 1996 and
         end on December 31, 1996. For each Plan Year thereafter,  the Plan Year
         shall begin on January 1 of each year and continue through December 31.

     1.31 "Pre-Retirement  Survivor Benefit" shall mean the benefit set forth in
          Article 6.

1.32     "Retirement,"  "Retire(s)" or "Retired"  shall mean, with respect to an
         Employee,  severance from  employment from all Employers for any reason
         other  than a leave of  absence,  death or  Disability  on or after age
         sixty-five  (65) or on or after age fifty-five (55) with ten (10) Years
         of Service, subject to Section 10.3.

1.33     "Retirement Benefit" shall mean the benefit set forth in Article 5.


                                                         5


<PAGE>



1.34     "Short-Term Payout" shall mean the payout set forth in Section 4.1.

1.35     "Termination Benefit" shall mean the benefit set forth in Article 7.

1.36     "Termination  of Employment"  shall mean the ceasing of employment with
         all Employers,  voluntarily or involuntarily, for any reason other than
         Retirement,  Disability,  death  or an  authorized  leave  of  absence,
         subject to Section 10.3.

1.37     "Trust"  shall  mean the trust  established  pursuant  to that  certain
         Master Trust Agreement, dated as of May 1, 1996 between the Company and
         the trustee named therein, as amended from time to time.

1.38     "Unforeseeable   Financial   Emergency"  shall  mean  an  unanticipated
         emergency  that  is  caused  by an  event  beyond  the  control  of the
         Participant  that  would  result in severe  financial  hardship  to the
         Participant  resulting  from (i) a sudden  and  unexpected  illness  or
         accident of the Participant or a dependent of the  Participant,  (ii) a
         loss of the Participant's property due to casualty, or (iii) such other
         extraordinary  and unforeseeable  circumstances  arising as a result of
         events beyond the control of the Participant,  all as determined in the
         sole discretion of the Committee.

1.39     "Unvested  Accrued  Amounts"  shall  mean the  part of a  Participant's
         Company Matching Account and Company  Restoration  Account which is not
         vested under Section 3.7.

1.40 "Vested Company Matching  Account" shall have the meaning set forth in
Section 3.7.

1.41 "Vested Company Restoration  Account" shall have the meaning set forth
in Section 3.7.

1.42     "Years of Service" shall mean the total number of full years in which a
         Participant has been employed by one or more Employers. For purposes of
         this definition, a year of employment shall be a 365 day period (or 366
         day  period in the case of a leap  year)  that,  for the first  year of
         employment,  commences on the  Employee's  date of hiring and that, for
         any subsequent  year,  commences on an anniversary of that hiring date.
         Any partial year of employment shall not be counted.

                                                    ARTICLE 2
                                        Selection, Enrollment, Eligibility

2.1      Selection by Committee. Participation in the Plan shall be limited to a
         select  group of  management  or highly  compensated  Employees  of the
         Employers, as determined by the Committee in its sole discretion.  From
         that  group,  the  Committee  shall  select,  in its  sole  discretion,
         Employees  to  participate  in the  Plan.  For this  purpose,  the term
         "highly  compensated"  shall be interpreted in a manner consistent with
         regulations and other guidance under the Code.

                                                         6


<PAGE>



2.2      Enrollment Requirements. As a condition to participation, each selected
         Employee shall complete, execute and return to the Committee, within 30
         days of selection, a Plan Agreement, an Election Form and a Beneficiary
         Designation Form. In addition,  the Committee shall establish from time
         to time such other enrollment requirements as it determines in its sole
         discretion are necessary.

2.3      Eligibility;   Commencement  of  Participation.  Provided  an  Employee
         selected to participate in the Plan has met all enrollment requirements
         set  forth  in this  Plan  and  required  by the  Committee,  including
         returning  all required  documents to the  Committee  within 30 days of
         selection,  that Employee shall commence  participation  in the Plan on
         the first day of the next month  which  begins  following  the date the
         Employee completes all enrollment requirements. If an Employee fails to
         meet all such  requirements  within the  required 30 day  period,  that
         Employee  shall not be  eligible to  participate  in the Plan until the
         first day of a month during the Plan Year following the delivery to and
         acceptance by the Committee of the required documents.

2.4      Termination  of  Participation  and/or  Deferrals.   If  the  Committee
         determines  in good faith that a Participant  no longer  qualifies as a
         member of a select group of management or highly compensated employees,
         as membership  in such group is  determined in accordance  with Section
         2.1 or otherwise  under  Sections  201(2),  301(a)(3)  and 401(a)(1) of
         ERISA, the Committee shall have the right, in its sole  discretion,  to
         (i) terminate any deferral  election the  Participant  has made for the
         Plan Year in which the Participant's  membership  status changes,  (ii)
         prevent the Participant  from making future deferral  elections  and/or
         (iii) immediately  distribute the  Participant's  then Account Balance,
         determined  as if there has occurred a Termination  of  Employment  and
         terminate the Participant's participation in the Plan. If the Committee
         chooses to terminate the  Participant's  participation in the Plan, the
         Committee  may, in its sole  discretion,  reinstate the  Participant to
         full Plan  participation  at such time in the future as the Participant
         again  becomes  a member  of the  select  group  described  above.  The
         foregoing  notwithstanding,  if the  Participant  ceases to  qualify as
         "highly  compensated"  under  Section 2.1, the Committee may permit the
         Participant  to  continue   participation   for  a  reasonable   period
         thereafter  in  order to  permit  the  Participant  an  opportunity  to
         reattain "highly compensated" status.

                                    ARTICLE 3
              Deferral Commitments/Company Matching/Crediting/Taxes

3.1      Minimum Deferral.
         ----------------

         (a)      Minimum. For each Plan Year, a Participant may elect to defer,
                  as his or her Annual Deferral Amount, a minimum of $2,000 from
                  either his or her Base Annual  Salary or Annual  Bonus.  If an
                  election is made for less than the stated minimum  amount,  or
                  if no election is made, the amount deferred shall be zero.

                                                         7


<PAGE>



         (b)      Short Plan Year. If a Participant  first becomes a Participant
                  after  the  first  day of a Plan  Year,  or in the case of the
                  first Plan Year of the Plan itself, the minimum deferral shall
                  be an amount equal to the minimum set forth above,  multiplied
                  by a  fraction,  the  numerator  of  which  is the  number  of
                  complete months remaining in the Plan Year and the denominator
                  of which is 12.

3.2      Maximum Deferral.
         ----------------

         (a)      Maximum. For each Plan Year, a Participant may elect to defer,
                  as his or her  Annual  Deferral  Amount,  Base  Annual  Salary
                  and/or  Annual Bonus up to the following  maximum  percentages
                  for each deferral elected:

                                                              Maximum

                  Deferral                                    Amount

                  Base Annual Salary                          90%
                  Annual Bonus                                90%

         (b)      Short Plan Year. If a Participant  first becomes a Participant
                  after  the  first  day of a Plan  Year,  or in the case of the
                  first Plan Year itself, for such Plan Year only, a Participant
                  may elect to defer, as his or her Annual Deferral Amount, Base
                  Annual  Salary  and/or Annual Bonus that accrue after the date
                  of entry into the Plan, a dollar  amount up to an amount equal
                  to the limits set forth in Section 3.2(a) above  multiplied by
                  such  Participant's  total amount of Base Annual Salary and/or
                  Annual Bonus for the entire Plan Year.

3.3      Election to Defer; Effect of Election Form.
         ------------------------------------------

         (a)      First  Plan  Year.   In   connection   with  a   Participant's
                  commencement  of  participation  in the Plan, the  Participant
                  shall make an irrevocable  deferral election for the Plan Year
                  in which the Participant commences  participation in the Plan,
                  along  with  such  other  elections  as  the  Committee  deems
                  necessary or desirable  under the Plan. For these elections to
                  be valid,  the Election  Form must be completed  and signed by
                  the  Participant,   timely  delivered  to  the  Committee  (in
                  accordance  with  Section  2.3  above),  and  accepted  by the
                  Committee.

         (b)      Subsequent  Plan  Years.  For each  succeeding  Plan Year,  an
                  irrevocable  deferral  election  for that Plan Year,  and such
                  other  elections as the Committee deems necessary or desirable
                  under the  Plan,  shall be made by  timely  delivering  to the
                  Committee, in accordance with its rules and procedures, before
                  the end of the Plan Year preceding the Plan Year for which the
                  election is made, a new Election  Form. If no Election Form is
                  timely  delivered for a Plan Year, no Annual  Deferral  Amount
                  shall be withheld for that Plan Year.

                                                         8


<PAGE>



3.4      Withholding of Annual  Deferral  Amounts.  For each Plan Year, the Base
         Annual Salary portion of the Annual  Deferral  Amount shall be withheld
         in equal  amounts  from each  regularly  scheduled  Base Annual  Salary
         payroll,   commencing  at  the  earliest   practicable   payroll  after
         participation  begins.  The Annual Bonus portion of the Annual Deferral
         Amount  shall be withheld at the time the Annual  Bonus is or otherwise
         would be paid to the Participant, whether or not this occurs during the
         Plan Year itself.

3.5      Annual Company Matching Amount. With respect to Plan Years prior to and
         including  the  1999  Plan  Year,   if,  and  only  if,  a  Participant
         participates  in the 401(k) Plan to the maximum  extent  possible under
         the limits  applicable to the Plan for the Plan Year, the Participant's
         Annual Company Matching Amount for such Plan Year shall be equal to 50%
         of the  Participant's  Annual Deferral Amount for such Plan Year, up to
         an amount  that does not exceed  the lesser of 5% of the  Participant's
         Base Annual Salary or 50% of the IRC 402(g)(i)  limit in the effect for
         the  Plan  Year,   reduced  by  the  amount  of  any  Company  matching
         contributions made to the 401(k) Plan on his or her behalf for the plan
         year of the 401(k) Plan that  corresponds  to the Plan Year. The Annual
         Company Matching Amount shall be credited to the Participant's  Company
         Matching  Account  as of the  first  day of  February  of the Plan Year
         following the Plan Year to which it relates. Notwithstanding the above,
         if a Participant is not employed by an Employer as of the last day of a
         Plan Year other than by reason of his or her Retirement,  Disability or
         death,  the Annual Company  Matching Amount for such Plan Year shall be
         zero. In the event of  Retirement,  Disability or death,  a Participant
         shall be credited with the Annual Company  Matching Amount for the Plan
         Year  in  which  he or she  Retires,  dies  or  becomes  disabled.  The
         foregoing  notwithstanding,  for any Plan Year beginning after 1999, no
         Annual Company  Matching Amount shall be credited to the  Participant's
         Company  Matching  Account,  although  prior  Annual  Company  Matching
         Amounts credited to such Account shall remain subject to the Plan.

3.6      Annual Company  Restoration  Amount.  The Participant's  Annual Company
         Restoration  Amount for each Plan Year beginning on or after January 1,
         1997 shall be equal to the amount of employer  contributions other than
         matching contributions under the 401(k) Plan which would have been made
         on the Participant's behalf and allocated to the Participant's  account
         on or  after  July 1,  1997  for  such  Plan  Year  but for one or more
         limitations imposed by the 401(k) Plan pursuant to the Code,  including
         but not limited to any such amounts  resulting from the  application of
         the compensation  limitations  contained in Code Section  401(a)(17) or
         the  limitations  contained  in Code  Section 415. For purposes of this
         Section  3.6,  employer  contributions  under the 401(k)  Plan  exclude
         contributions resulting from the cash or deferred arrangement under the
         401(k) Plan but include  contributions  resulting from the reallocation
         of prior  employer  contributions  (other than matching  contributions)
         forfeited  by  other  401(k)  Plan  participants.  The  Annual  Company
         Restoration  Amount  shall be  credited  to the  Participant's  Company
         Restoration  Account  as of the date or dates such  amounts  would have
         been allocated to the Participant's account(s) under the 401(k) Plan if
         such  amounts had in fact been  allocated  under the 401(k)  Plan.  The
         foregoing  notwithstanding  the above, if a Participant is not employed
         by an Employer as of the last day of a Plan Year other than

                                                         9


<PAGE>



         by reason of his or her  Retirement,  Disability  or death,  the Annual
         Company  Restoration  Amount for such Plan Year  shall be zero.  In the
         event of  Retirement,  Disability  or  death,  a  Participant  shall be
         credited with the Annual Company  Restoration  Amount for the Plan Year
         in which he or she Retires, dies or becomes disabled. The Participant's
         Annual Company  Restoration Amount for each Plan Year prior to the Plan
         Year beginning January 1, 1997 shall be zero. It is understood that the
         Company will  discontinue  employer  contributions  other than matching
         contributions  under the 401(k) Plan in Plan Years after 1999,  so that
         no amount will be credited as an Annual Company  Restoration Amounts in
         respect of such Plan Years.

     3.7 Vested Company Matching Account, Vested Company Restoration Account and
Deferral  Account.  With respect to all benefits  under this Plan other than the
Termination Benefit, a Participant's Vested Company Matching Account shall equal
100% of such Participant's  Company Matching Account and a Participant's  Vested
Company  Restoration  Account  shall  equal 100% of such  Participant's  Company
Restoration  Account.  With respect to the Termination Benefit, in the case of a
Termination of Employment  prior to July 1, 1999, the vesting of a Participant's
Company  Matching Account and Company  Restoration  Account shall be governed by
the  terms  of this  Plan as in  effect  at the  time  of  such  Termination  of
Employment.  With  respect  to  the  Termination  Benefit,  in  the  case  of  a
Termination  of  Employment  on or after July 1, 1999, a  Participant's  Company
Matching Account and Company  Restoration Account shall vest on the basis of the
Participant's  Years  of  Service  at the  time the  Participant  experiences  a
Termination  of  Employment,  in  accordance  with the  following  schedule  for
balances resulting from Company Matching Amounts and Company Restoration Amounts
for the Plan Year after 1999:

                                                 Vested Percentage of

         Years of Service at Date of             Company Matching Account and
         Termination of Employment               Company Restoration Account

         Less than 1 year                                     0%
         1 year or more, but less than 2                     33%
         2 years or more, but less than 3                    66%
         3 years or more                                     100%

         The   foregoing   notwithstanding,   after  a  Change  in  Control,   a
         Participant's  Vested Company Matching Account shall equal 100% of such
         Participant's  Company  Matching  Account  and a  Participant's  Vested
         Company  Restoration  Account  shall  equal 100% of such  Participant's
         Company  Restoration  Account.  A Participant's  Deferral Account shall
         always be 100% vested.

3.8      Crediting/Debiting of Account Balances. In accordance with, and subject
         to, the rules and procedures that are established  from time to time by
         the  Committee,  in its sole  discretion,  amounts shall be credited or
         debited to a Participant's  Account  Balance (and to the  Participant's
         Unvested Accrued Amounts) in accordance with the following rules:

                                                        10


<PAGE>



     (a) Election of Measurement Funds. A Participant, in connection with his or
her initial  deferral  election in accordance  with Section 3.3(a) above,  shall
elect,  on the Election Form, one or more  Measurement  Fund(s) (as described in
Section  3.8(c)  below) to be used to  determine  the  additional  amounts to be
credited or debited to his or her Account Balance (and Unvested Accrued Amounts)
from the date on which the Participant  commences  participation in the Plan and
continuing  thereafter,  unless  changed in accordance  with the next  sentence.
Commencing  with the  January  1 or July 1  ("Investment  Election  Date")  that
follows the Participant's  commencement of participation in the Plan and on each
subsequent Investment Election Date during which the Participant participates in
the  Plan,  no later  than the day  before  an  Investment  Election  Date,  the
Participant  may (but is not required to) elect,  by submitting an Election Form
to the Committee that is accepted by the Committee, to add or delete one or more
Measurement  Fund(s)  to be used to  determine  the  amounts to be  credited  or
debited to his or her Account  Balance (and  Unvested  Accrued  Amounts),  or to
change the portion of his or her Account Balance (and Unvested  Accrued Amounts)
allocated to each previously or newly elected  Measurement  Fund. If an election
is made in  accordance  with the previous  sentence,  it shall apply to the next
Investment Election Date and continue  thereafter,  unless changed in accordance
with the previous sentence.  Notwithstanding the foregoing, the maximum transfer
that may be made from the Declared Rate Measurement Fund to another  Measurement
Fund in any one Plan  Year  cannot  exceed  20% of the  maximum  balance  in the
Participant's  account in the Declared Rate Measurement Fund in the current Plan
Year and the four prior Plan  Years,  provided  that this  restriction  shall no
longer  apply  upon  termination  of  the  Declared  Rate  Measurement  Fund  in
accordance with Section 3.8(c).

         (b)      Proportionate  Allocation. In making any election described in
                  Section  3.8(a) above,  the  Participant  shall specify on the
                  Election Form, in whole percentage points (1%), the percentage
                  of his or her Account Balance (and Unvested  Accrued  Amounts)
                  to be allocated to a Measurement  Fund (as if the  Participant
                  was making an  investment in that  Measurement  Fund with that
                  portion of his or her  Account  Balance and  Unvested  Accrued
                  Amounts).

     (c) Measurement  Funds.  The Participant may elect one or more  measurement
funds, based on certain mutual funds (the "Measurement  Funds"), for the purpose
of crediting  or debiting  amounts to his or her Account  Balance (and  Unvested
Accrued  Amounts).  The  Committee  shall select the mutual funds that are to be
used as  Measurement  Funds.  As  necessary,  the  Committee  may,  in its  sole
discretion,  discontinue, substitute or add a Measurement Fund at any time. Each
such action will take effect as of the first day of the  calendar  quarter  that
follows by thirty (30) days the day on which the  Committee  gives  Participants
advance written notice of such change. In addition,  a Declared Rate Measurement
Fund shall be maintained  until December 31, 1999, under which interest shall be
credited at a rate as  specified  by the  Company on the  November 1 of the year
prior to the Plan Year for which the amount of interest is being determined;

                                                        11


<PAGE>



                  provided,  however,  that as of January 1, 2000,  the Declared
                  Rate  Measurement  Fund will be  terminated  and all  balances
                  therein shall be transferred to such other  Measurement  Funds
                  as may have been elected by the Participant or, in the absence
                  of any election,  to a Measurement  Fund  consisting of one or
                  more Guaranteed Interest Contracts.

     (d)  Crediting  or  Debiting  Method.  The  performance  of  each  selected
Measurement  Fund  (either  positive  or  negative)  will be  determined  by the
Committee in its sole  discretion  based on the  performance of the  Measurement
Funds themselves or, in the case of the Declared Rate Measurement Fund (prior to
its termination),  based on the amount of accrued interest credited to the fund.
A Participant's Account Balance (and Unvested Accrued Amounts) shall be credited
or debited based on such  performance of the Measurement  Funds as determined by
the Committee in its sole discretion.  As of each Investment  Election Date, the
Committee shall  distribute to the  Participants a statement of their respective
Account Balances (and Unvested Accrued Amounts).  Furthermore, in the event of a
Participant's   termination  of  employment  or  any  other  event  requiring  a
determination  of the  Participant's  Benefit  or the  value of a  Participant's
Account  Balance,   the  Account  Balance  shall  be  determined  based  on  the
performance of the relevant Measurement Fund(s) through the last date of the pay
period  during  which  the  event  occurs  and  shall  not be  further  adjusted
thereafter.

     (e) No Actual Investment.  Notwithstanding any other provision of this Plan
that may be interpreted to the contrary,  the  Measurement  Funds are to be used
for  measurement  purposes  only,  and a  Participant's  election  of  any  such
Measurement  Fund,  the  allocation to his or her Account  Balance (and Unvested
Accrued  Amounts)  thereto,  the  calculation  of  additional  amounts  and  the
crediting or debiting of such amounts to a  Participant's  Account  Balance (and
Unvested  Accrued Amounts) shall not be considered or construed in any manner as
an actual investment of his or her Account Balance (or Unvested Accrued Amounts)
in any such  Measurement  Fund. In the event that the Company or the Trustee (as
that term is defined in the  Trust),  in its own  discretion,  decides to invest
funds in any or all of the  Measurement  Funds,  no  Participant  shall have any
rights in or to such investments  themselves.  Without limiting the foregoing, a
Participant's  Account Balance (and Unvested Accrued Amounts) shall at all times
be a bookkeeping  entry only and shall not represent any investment  made on his
or her behalf by the Company or the Trust;  the  Participant  shall at all times
remain an unsecured creditor of the Company.

3.9      FICA,  Withholding  and  Other  Taxes.  For each  Plan Year in which an
         Annual Deferral Amount is being withheld or an Annual Company  Matching
         Amount  or  Annual  Company   Restoration   Amount  is  credited  to  a
         Participant,  the  Participant's  Employer(s)  shall withhold from that
         portion of the  Participant's  Base Annual  Salary  and/or Annual Bonus
         that is not being deferred,  in a manner determined by the Employer(s),
         the  Participant's  share  of  FICA  and  other  employment  taxes.  If
         necessary, the Committee

                                                        12


<PAGE>



         shall  reduce the Annual  Deferral  Amount in order to comply with this
         Section 3.9. In addition,  the Participant's  Employer(s) or the Trust,
         shall withhold from any payments made to a Participant  under this Plan
         all  federal,  state  and local  income,  employment  and  other  taxes
         required to be withheld in connection  with such  payments,  in amounts
         and  in a  manner  to be  determined  in  the  sole  discretion  of the
         Employer(s) or the Trust.

3.10     Rollovers  From Prior  Deferred  Compensation  Plan. A Participant  who
         participated in the Company's prior nonqualified  deferred compensation
         plan shall  have the  right,  under such rules and at such times as are
         prescribed  by the  Committee,  to  roll  over  the  benefit  that  the
         Participant is entitled to receive pursuant to such prior  nonqualified
         deferred  compensation  plan so that  such  amount  shall  be held  and
         administered  pursuant  to the terms of this Plan and shall be received
         at the same time that benefits are received pursuant to this Plan.

                                    ARTICLE 4
             Short-Term Payout; Unforeseeable Financial Emergencies;
                               Withdrawal Election

4.1      Short-Term  Payout. In connection with each election to defer an Annual
         Deferral   Amount,   a  Participant  may  elect  to  receive  a  future
         "Short-Term  Payout" from the Plan with respect to that Annual Deferral
         Amount.  Subject to the Deduction  Limitation,  the  Short-Term  Payout
         shall be a lump sum  payment  in an amount  that is equal to the Annual
         Deferral Amount plus amounts credited or debited in the manner provided
         in  Section  3.8 above on that  amount,  determined  at the time of the
         Short-Term  Payout becomes  payable.  If the Annual  Deferral Amount is
         deferred in the 1999 Plan Year or an earlier Plan Year, each Short-Term
         Payout  elected  shall be paid,  subject to the  Deduction  Limitation,
         within 60 days of the first day of the Plan Year that is at least  four
         years after the last day of the Plan Year in which the Annual  Deferral
         Amount is actually  deferred,  subject to the terms and  conditions  of
         this Plan.  If the Annual  Deferral  Amount is deferred  after the 1999
         Plan Year, each Short-Term Payout elected shall be paid, subject to the
         Deduction Limitation,  within 60 days of the first day of the Plan Year
         elected by the Participant that is two or more years after the last day
         of the Plan  Year in which  the  Annual  Deferral  Amount  is  actually
         deferred,  subject to the terms and  conditions of this Plan. By way of
         example,  if a  Short-Term  Payout  is  elected  for  amounts  that are
         deferred in the Plan Year  commencing  January 1, 1997,  the Short-Term
         Payout  becomes  payable  within 60 days after  January  1, 2002;  if a
         Short-Term  Payout is elected for amounts that are deferred in the Plan
         Year  commencing  January 1, 2000,  the earliest  that the  Participant
         could elect to receive  such  Short-Term  Payout would be 60 days after
         January 1, 2003 (although the Participant would be permitted to elect a
         greater number of years of deferral for the Short-Term Payout).

4.2      Other Benefits Take Precedence Over Short-Term Payout.  Should an event
         occur that triggers a benefit  under  Articles 5, 6, 7 or 8, any Annual
         Deferral  Amount,  plus amounts  credited or debited  thereon,  that is
         subject to a Short-Term Payout election under Section

                                                        13


<PAGE>



         4.1 shall not be paid in accordance  with Section 4.1 but shall be paid
         in accordance with the other applicable Article.

4.3      Withdrawal  Payout/Suspensions for Unforeseeable Financial Emergencies.
         If the Participant  experiences an Unforeseeable  Financial  Emergency,
         the Participant may petition the Committee to (i) suspend any deferrals
         required to be made by a  Participant  and/or (ii) receive a partial or
         full  payout from the Plan.  The payout  shall not exceed the lesser of
         the  Participant's  Account Balance,  calculated as if such Participant
         were receiving a Termination  Benefit,  or the amount reasonably needed
         to satisfy the Unforeseeable  Financial  Emergency.  If, subject to the
         sole discretion of the Committee,  the petition for a suspension and/or
         payout is  approved,  suspension  shall  take  effect  upon the date of
         approval  and any  payout  shall be made  within 60 days of the date of
         approval. The payment of any amount under this Section 4.3 shall not be
         subject to the Deduction Limitation.

4.4      Withdrawal  Election. A Participant may elect, at any time, to withdraw
         all of his or her Account Balance,  less a withdrawal  penalty equal to
         10% of  such  amount  (the  net  amount  shall  be  referred  to as the
         "Withdrawal Amount").  This election can be made at any time, before or
         after Retirement,  Disability,  death or Termination of Employment, and
         whether or not the  Participant  (or  Beneficiary) is in the process of
         being paid pursuant to an installment payment schedule.  If made before
         Retirement,  Disability or death,  a  Participant's  Withdrawal  Amount
         shall be his or her Account Balance calculated as if there had occurred
         a Termination  of Employment as of the day of the election.  No partial
         withdrawals of the Withdrawal Amount shall be allowed.  The Participant
         shall make this election by giving the Committee advance written notice
         of  the  election  in a  form  determined  from  time  to  time  by the
         Committee.  The Participant  shall be paid the Withdrawal Amount within
         60 days of his or her election. Once the Withdrawal Amount is paid, the
         Participant's   participation   in  the  Plan  shall   terminate,   the
         Participant's  Unvested  Accrued  Amounts  will  be  forfeited  and the
         Participant  shall not be eligible to participate in the Plan until the
         first   month  that  begins  more  than  one  year  after  his  or  her
         participation in the Plan  terminated,  at which time he or she will be
         eligible to reenroll on terms  similar to those  applicable  to a newly
         hired  employee.  The payment of this  Withdrawal  Amount  shall not be
         subject to the Deduction Limitation.

                                    ARTICLE 5
                               Retirement Benefit

     5.1 Retirement Benefit.  Subject to the Deduction Limitation, a Participant
who Retires shall receive, as a Retirement Benefit, his or her Account Balance.

     5.2 Payment of Retirement Benefit. A Participant, in connection with his or
her commence ment of  participation in the Plan, shall elect on an Election Form
to  receive  the  Retirement  Benefit  in a lump sum or  pursuant  to a  Monthly
Installment Method of 60, 120 or 180 months. The Participant may annually change
his or her election to an

                                                        14


<PAGE>



         allowable  alternative  payout period by submitting a new Election Form
         to the Committee,  provided that any such Election Form is submitted at
         least one year prior to the Participant's Retirement and is accepted by
         the Committee in its sole  discretion.  The Election Form most recently
         accepted by the  Committee  shall  govern the payout of the  Retirement
         Benefit.  If a  Participant  does not make any election with respect to
         the payment of the Retirement Benefit, such benefit shall be payable in
         a lump sum. The lump sum payment shall be made, or installment payments
         shall  commence,  no later than 60 days after the date the  Participant
         Retires,  subject to Section 10.3 (which delays commencement of payment
         of the Retirement  Benefit if the Participant  enters into a consulting
         arrangement with the Company following the  Participant's  Retirement).
         Any payment made shall be subject to the Deduction Limitation.

5.3      Death Prior to Completion of Retirement  Benefit. If a Participant dies
         after Retirement but before the Retirement Benefit is paid in full, the
         Participant's  unpaid  Retirement  Benefit  payments shall continue and
         shall be paid to the  Participant's  Beneficiary (a) over the remaining
         number of months  and in the same  amounts as that  benefit  would have
         been paid to the Participant had the Participant  survived, or (b) in a
         lump sum,  if reques  ted by the  Beneficiary  and  allowed in the sole
         discretion of the Committee,  that is equal to the Participant's unpaid
         remaining Account Balance.

                                                     ARTICLE 6
                                          Pre-Retirement Survivor Benefit

6.1      Pre-Retirement  Survivor Benefit.  Subject to the Deduction Limitation,
         the Participant's  Beneficiary shall receive a Pre-Retirement  Survivor
         Benefit equal to the  Participant's  Account Balance if the Participant
         dies before he or she Retires,  experiences a Termination of Employment
         or suffers a Disability.

6.2      Payment of Pre-Retirement Survivor Benefit. The Pre-Retirement Survivor
         Benefit  shall  be paid in the  same  manner  and at the  same  time as
         specified in the election made by the  Participant  pursuant to Section
         5.2.

                                                     ARTICLE 7
                                                Termination Benefit

7.1      Termination  Benefit.   Subject  to  the  Deduction   Limitation,   the
         Participant shall receive a Termination  Benefit,  which shall be equal
         to the Participant's Account Balance (i.e.,  determined based on Vested
         Company   Matching   Contributions   and  Vested  Company   Restoration
         Contributions) if a Participant experiences a Termination of Employment
         prior to his or her Retirement, death or Disability.

     7.2 Payment of Termination  Benefit.  The Termination Benefit shall be paid
in a lump sum  within  60 days of the  Termination  of  Employment,  subject  to
Section 10.3.

                                                        15


<PAGE>



         Notwithstanding the foregoing,  a Participant may elect either (i) upon
         his  election to  participate  in the Plan or (ii) at any time at least
         one year prior to Termination of Employment to receive the  Termination
         Benefit in three, five, or ten annual  installments.  In such case, the
         Termination   Benefit  shall  be  paid  in  the  applicable  number  of
         installments,  commencing no later than 60 days after the Participant's
         Termination  of  Employment,  subject to  Section  10.3  (which  delays
         commencement of payment of the  Termination  Benefit if the Participant
         enters into a consulting  arrangement  with the Company  following  the
         Participant's  Termination  of  Employment).  Any payment made shall be
         subject to the  Deduction  Limitation.  The  Participant  may  annually
         change his or her election to an allowable alternative payout period by
         submitting a new Election Form to the Committee, provided that any such
         Election Form is submitted at least one year prior to the Participant's
         Termination  of Employment and is accepted by the Committee in its sole
         discretion.

                                                     ARTICLE 8
                                           Disability Waiver and Benefit

8.1      Disability Waiver.


     (a) Waiver of Deferral. A Participant who is determined by the Committee to
be suffering from a Disability  shall be excused from fulfilling that portion of
the Annual  Deferral  Amount  commitment that would otherwise have been withheld
from a  Participant's  Base Annual  Salary and/or Annual Bonus for the Plan Year
during which the  Participant  first suffers a Disability.  During the period of
Disability, the Participant shall not be allowed to make any additional deferral
elections,  but will  continue  to be  considered  a  Participant  for all other
purposes of this Plan.  Notwithstanding  the  foregoing,  if the  Disability  is
determined by the Committee to be expected to be of a short term  duration,  the
Annual Deferral  Amount shall continue to be withheld from a Participant's  Base
Annual Salary and/or Annual Bonus.

         (b)      Return to Work. If a Participant returns to employment with an
                  Employer, after a Disability ceases, the Participant may elect
                  to defer an Annual Deferral Amount for the Plan Year following
                  his or her return to  employment or service and for every Plan
                  Year thereafter while a Participant in the Plan; provided such
                  deferral  elections are otherwise allowed and an Election Form
                  is delivered to and  accepted by the  Committee  for each such
                  election in accordance with Section 3.3 above.

8.2      Continued  Eligibility;  Disability Benefit. A Participant  suffering a
         Disability shall, for benefit purposes under this Plan,  continue to be
         considered  to be  employed,  and shall be  eligible  for the  benefits
         provided for in Articles 4, 5, 6 or 7 in accordance with the provisions
         of those Articles.  Notwithstanding the above, the Committee shall have
         the right to, in its sole and absolute  discretion  and for purposes of
         this Plan only, and must in the case of a Participant  who is otherwise
         eligible to Retire, deem the Participant to have

                                                        16


<PAGE>



         experienced  a  Termination  of  Employment,   or  in  the  case  of  a
         Participant who is eligible to Retire, to have Retired, at any time (or
         in the case of a  Participant  who is  eligible  to Retire,  as soon as
         practicable)  after such  Participant  is determined to be  permanently
         disabled (i) under the Participant Employer's long-term disability plan
         (or would have been determined to be permanently disabled had he or she
         participated  in that plan),  or (ii) if such a plan does not exist, by
         the  Committee in its sole  discretion,  in which case the  Participant
         shall receive a Disability  Benefit equal to his or her Account Balance
         at the time the Committee's determination. The Disability Benefit shall
         be paid in the same  manner  and at the same time as  specified  in the
         election made by the  Participant  pursuant to Section 5.2,  unless the
         Committee in its sole discretion  elects at any time to pay such amount
         or any remaining  amount in a lump sum payment.  Any payment made shall
         be subject to the Deduction Limitation.

                                                     ARTICLE 9
                                              Beneficiary Designation

9.1      Beneficiary.  Each  Participant  shall have the right,  at any time, to
         designate  his  or  her  Beneficiary(ies)  (both  primary  as  well  as
         contingent)  to  receive  any  benefits  payable  under  the  Plan to a
         beneficiary upon the death of a Participant. The Beneficiary designated
         under this Plan may be the same as or  different  from the  Beneficiary
         designation   under  any  other  plan  of  an  Employer  in  which  the
         Participant participates.

     9.2 Beneficiary  Designation;  Change; Spousal Consent. A Participant shall
designate  his or her  Beneficiary  by  completing  and signing the  Beneficiary
Designation  Form, and returning it to the Committee or its designated  agent. A
Participant shall have the right to change a Beneficiary by completing,  signing
and otherwise  complying with the terms of the Beneficiary  Designation Form and
the  Committee's  rules and  procedures,  as in effect from time to time. If the
Participant names someone other than his or her spouse as a Beneficiary for more
than  50% of  the  Participant's  benefits,  a  spousal  consent,  in  the  form
designated by the  Committee,  must be signed by that  Participant's  spouse and
returned to the  Committee  (subject to any  procedural  requirements  as may be
imposed  by the  Committee).  Upon  the  acceptance  by the  Committee  of a new
Beneficiary  Designation  Form, all Beneficiary  designations  previously  filed
shall  be  cancelled.  The  Committee  shall  be  entitled  to rely on the  last
Beneficiary  Designation  Form  filed by the  Participant  and  accepted  by the
Committee prior to his or her death.

9.3      Acknowledgment.   No   designation   or  change  in  designation  of  a
         Beneficiary   shall  be   effective   until   received,   accepted  and
         acknowledged in writing by the Committee or its designated agent.

     9.4 No  Beneficiary  Designation.  If a  Participant  fails to  designate a
Beneficiary as provided in Sections 9.1, 9.2 and 9.3 above or, if all designated
Beneficiaries  predecease the Participant or die prior to complete  distribution
of the Participant's  benefits,  then the Participant's  designated  Beneficiary
shall be deemed to be his or her surviving spouse. If

                                                        17


<PAGE>



         the Participant has no surviving spouse,  the benefits  remaining under
         the Plan to be paid to a  Beneficiary  shall be payable to the executor
         or personal representative of the Participant's estate.

9.5      Doubt  as to  Beneficiary.  If the  Committee  has any  doubt as to the
         proper  Beneficiary  to receive  payments  pursuant  to this Plan,  the
         Committee shall have the right, exercisable in its discretion, to cause
         the Participant's  Employer to withhold such payments until this matter
         is resolved to the Committee's satisfaction.

9.6      Discharge of  Obligations.  The payment of benefits under the Plan to a
         Beneficiary  shall fully and  completely  discharge  the  Company,  all
         Employers and the  Committee  from all further  obligations  under this
         Plan with  respect  to the  Participant,  and that  Participant's  Plan
         Agreement shall terminate upon such full payment of benefits.

                                                    ARTICLE 10
                                           Leave of Absence; Consulting

10.1     Paid  Leave  of  Absence.   If  a  Participant  is  authorized  by  the
         Participant's  Employer  for any reason to take a paid leave of absence
         from the employment of the Employer,  the Participant shall continue to
         be considered  employed by the Employer and the Annual  Deferral Amount
         shall  continue  to be  withheld  during  such paid leave of absence in
         accordance with Section 3.3.

10.2     Unpaid  Leave  of  Absence.  If a  Participant  is  authorized  by  the
         Participant's  Employer  for any  reason  to take an  unpaid  leave  of
         absence from the  employment of the  Employer,  the  Participant  shall
         continue to be considered  employed by the Employer and the Participant
         shall be excused  from making  deferrals  until the earlier of the date
         the leave of  absence  expires  or the  Participant  returns  to a paid
         employment  status.  Upon such  expiration or return,  deferrals  shall
         resume  for  the  remaining  portion  of the  Plan  Year in  which  the
         expiration or return occurs,  based on the deferral  election,  if any,
         made for that Plan Year. If no election was made for that Plan Year, no
         deferral shall be withheld.

10.3     Consulting Arrangements.  Other provisions of the Plan notwithstanding,
         if the Company enters into a consulting  arrangement with a Participant
         effective   upon  the   Participant's   Retirement  or  Termination  of
         Employment,  the  payment  of the  Retirement  Benefit  or  Termination
         Benefit shall be delayed. In this case, the Participant will be treated
         as  though  employment  continued  until  the  consulting   arrangement
         terminates for purposes of determining the time at which payment of the
         Retirement Benefit or Termination Benefit will commence. This provision
         will not limit the Participant's withdrawal rights under Section 4.3 or
         4.4  during  the  pendency  of  the  consulting  arrangement,  but  the
         Participant  will not be  permitted  to defer  compensation  payable in
         connection  with  such  consulting  arrangement  under  the  Plan.  Any
         determination  of whether the  Participant's  severance from employment
         constitutes  a  Retirement  or  Termination  of  Employment   shall  be
         determined based on his or her circumstances at the time employment

                                                        18


<PAGE>



     terminates,  without  regard  to  any  continued  service  pursuant  to the
consulting arrangement.


                                                    ARTICLE 11
                                      Termination, Amendment or Modification

11.1     Termination.  Each Employer reserves the right to terminate the Plan at
         any time with respect to any or all of its  Participants by the actions
         of its  board of  directors.  Upon  the  termination  of the Plan  with
         respect  to  any  Employer,   the  Plan   Agreements  of  the  affected
         Participants  who are employed by that  Employer  shall  terminate  and
         their  Account  Balance,  determined  as  if  they  had  experienced  a
         Termination of Employment on the date of Plan  termination  or, if Plan
         termination occurs after the date upon which a Participant was eligible
         to Retire,  then with respect to that  Participant  as if he or she had
         Retired  on  the  date  of  Plan  termination,  shall  be  paid  to the
         Participants as follows:  Prior to a Change in Control,  if the Plan is
         terminated with respect to all of its  Participants,  an Employer shall
         have  the  right,  in its  sole  discretion,  and  notwithstanding  any
         elections made by the  Participant,  to pay such benefits in a lump sum
         promptly after termination or pursuant to a Monthly  Installment Method
         of up to 15  years,  with  amounts  credited  and  debited  during  the
         installment  period as provided  herein,  except  that,  if the Plan is
         terminated  with  respect  to less  than  all of its  Participants,  an
         Employer  shall be required to pay such benefits in a lump sum promptly
         after  termination.  After a Change in Control,  the Employer  shall be
         required  to  pay  such  benefits  in a  lump  sum  except  that,  if a
         Participant  has elected,  upon his election to participate in the Plan
         or at least one year prior to such  termination of the Plan, to receive
         the benefits in three,  five, or ten annual  installments under Section
         7.2, the Employer shall pay such benefits in the  applicable  number of
         annual  installments  commencing  promptly after such termination.  The
         termination of the Plan shall not adversely  affect any  Participant or
         Beneficiary  who has become  entitled  to the  payment of any  benefits
         under the Plan prior to such termination;  provided  however,  that the
         Employer  shall have the right to  accelerate  installment  payments by
         paying  the  Account  Balance  in a lump sum or  pursuant  to a Monthly
         Installment  Method  using fewer months  (except  following a Change in
         Control in the case of Participant who has elected under Section 7.2 to
         receive the benefits in a three, five or ten annual installments).

11.2     Amendment.  Any Employer may, at any time,  amend or modify the Plan in
         whole or in part with  respect to that  Employer  by the actions of its
         board  of   directors;   provided,   however,   that  no  amendment  or
         modification  shall be effective to decrease or restrict the value of a
         Participant's Account Balance in existence at the time the amendment or
         modification is made,  calculated as if the Participant had experienced
         a Termination  of Employment as of the effective  date of the amendment
         or modification,  or, if the amendment or modification occurs after the
         date upon which the Participant was eligible to Retire, the Participant
         had Retired as of the effective date of the amendment or  modification.
         The  amendment  or  modification  of the  Plan  shall  not  affect  any
         Participant  or Beneficiary  who has become  entitled to the payment of
         benefits under the Plan as of

                                                        19


<PAGE>



         the date of the amendment or modification;  provided, however, that the
         Employer  shall have the right to  accelerate  installment  payments by
         paying  the  Account  Balance  in a lump sum or  pursuant  to a Monthly
         Installment Method using fewer months.

11.3     Plan Agreement. Despite the provisions of Sections 11.1 and 11.2 above,
         if a Participant's Plan Agreement contains benefits or limitations that
         are not in this Plan document, the Employer may only amend or terminate
         such provisions with the consent of the Participant.

11.4     Effect of Payment.  The full payment of the  applicable  benefit  under
         Section  4.4 or  Articles  5, 6, 7 or 8 of the  Plan  shall  completely
         discharge all  obligations  to a Participant  and his or her designated
         Beneficiaries  under  this Plan and the  Participant's  Plan  Agreement
         shall terminate.

                                                    ARTICLE 12
                                                  Administration

12.1     Committee Duties.  This Plan shall be administered by a Committee which
         shall  consist  of the  Board,  or such  committee  as the Board  shall
         appoint.  Members of the Committee may be Participants under this Plan.
         The Committee shall also have the discretion and authority to (i) make,
         amend, interpret, and enforce all appropriate rules and regulations for
         the  administration of this Plan and (ii) decide or resolve any and all
         questions  including  interpretations  of this  Plan,  as may  arise in
         connection  with the Plan. The Committee  may, in its sole  discretion,
         waive or modify the length of the advance-election period a Participant
         is  required to make an election as to the manner and timing of payment
         of Retirement or  Termination  Benefits under Sections 5.2 or 7.2 or in
         connection with the termination of the Plan under Section 11.1.

12.2     Agents.  In the  administration  of this Plan,  the Committee may, from
         time to time,  employ  agents and delegate to them such  administrative
         duties  as it sees  fit  (including  acting  through  a duly  appointed
         representative)  and may from time to time consult with counsel who may
         be counsel to any Employer.

12.3     Binding  Effect of  Decisions.  The decision or action of the Committee
         with respect to any question  arising out of or in connection  with the
         administration,  interpretation  and  application  of the  Plan and the
         rules  and  regulations   promulgated  hereunder  shall  be  final  and
         conclusive  and  binding  upon all persons  having any  interest in the
         Plan.

12.4     Indemnity of Committee. All Employers shall indemnify and hold harmless
         the  members  of the  Committee  against  any and all  claims,  losses,
         damages,  expenses or liabilities arising from any action or failure to
         act with respect to this Plan, except in the case of willful misconduct
         by the Committee or any of its members.

                                                        20


<PAGE>



12.5     Employer Information. To enable the Committee to perform its functions,
         each Employer shall supply full and timely information to the Committee
         on all matters  relating to the compensation of its  Participants,  the
         date  and  circumstances  of  the  Retirement,   Disability,  death  or
         Termination of Employment of its Participants, and such other pertinent
         information as the Committee may reasonably require.

                                                    ARTICLE 13
                                           Other Benefits and Agreements

13.1     Coordination   with  Other  Benefits.   The  benefits  provided  for  a
         Participant  and  Participant's  Beneficiary  under  the  Plan  are  in
         addition to any other benefits  available to such Participant under any
         other plan or program for employees of the Participant's  Employer. The
         Plan  shall  supplement  and shall not  supersede,  modify or amend any
         other  such  plan or  program  except  as may  otherwise  be  expressly
         provided.

                                                    ARTICLE 14
                                                 Claims Procedures

14.1     Presentation  of Claim.  Any  Participant  or Beneficiary of a deceased
         Participant (such Participant or Beneficiary being referred to below as
         a  "Claimant")  may  deliver  to the  Committee  a written  claim for a
         determination  with  respect  to  the  amounts  distributable  to  such
         Claimant  from the Plan.  If such a claim  relates to the contents of a
         notice received by the Claimant,  the claim must be made within 60 days
         after such notice was received by the  Claimant.  All other claims must
         be made  within 180 days of the date on which the event that caused the
         claim to arise occurred.  The claim must state with  particularity  the
         determination desired by the Claimant.

     14.2  Notification  of Decision.  The Committee shall consider a Claimant's
claim within a reasonable time, and shall notify the Claimant in writing:

     (a) that the Claimant's requested determination has been made, and that the
         claim has been allowed in full; or

         (b)      that the Committee has reached a conclusion contrary, in whole
                  or in part, to the  Claimant's  requested  determination,  and
                  such  notice  must  set  forth in a  manner  calculated  to be
                  understood by the Claimant:

     (i) the specific reason(s) for the denial of the claim, or any part of it;

     (ii) specific  reference(s) to pertinent  provisions of the Plan upon which
such denial was based;


                                                        21


<PAGE>



                  (iii)    a   description   of  any   additional   material  or
                           information necessary for the Claimant to perfect the
                           claim,  and an  explanation  of why such  material or
                           information is necessary;  and (iv) an explanation of
                           the claim review  procedure set forth in Section 14.3
                           below.

14.3     Review of a Denied Claim.  Within 60 days after receiving a notice from
         the  Committee  that a claim has been  denied,  in whole or in part,  a
         Claimant (or the Claimant's  duly authorized  representative)  may file
         with the Committee a written  request for a review of the denial of the
         claim.  Thereafter,  but  not  later  than  30 days  after  the  review
         procedure  began,  the  Claimant  (or the  Claimant's  duly  authorized
         representative):

         (a)      may review pertinent documents;

         (b)      may submit written comments or other documents; and/or

     (c) may request a hearing, which the Committee, in its sole discretion, may
grant.

14.4     Decision on Review.  The Committee  shall render its decision on review
         promptly,  and not later  than 60 days  after  the  filing of a written
         request  for  review of the  denial,  unless a hearing is held or other
         special  circumstances  require  additional  time,  in  which  case the
         Committee's  decision must be rendered within 120 days after such date.
         Such decision  must be written in a manner  calculated to be understood
         by the Claimant, and it must contain:

         (a)      specific reasons for the decision;

     (b) specific  reference(s)  to the pertinent Plan provisions upon which the
decision was based; and

         (c)      such other matters as the Committee deems relevant.

     14.5 Legal Action. A Claimant's compliance with the foregoing provisions of
this Article 14 is a mandatory  prerequisite  to a Claimant's  right to commence
any legal action with respect to any claim for benefits under this Plan.


                                                    ARTICLE 15
                                                       Trust

15.1     Establishment  of the Trust. The Company shall establish the Trust, and
         the each Employer  shall at least  annually  transfer over to the Trust
         such assets as the Employer  determines are necessary to provide,  on a
         present value basis, for its future liabilities created with respect to
         all Annual  Deferral  Amounts,  Company  Matching  Amounts  and Company
         Restoration  Amounts for such Employer's  Participants  for all periods
         prior  to the  transfer,  as  well as the  credits  and  debits  to the
         Participants' Account Balance (and

                                                        22


<PAGE>



         Unvested Accrued Amounts) for all periods prior to the transfer, taking
         into  consideration the value of the assets in the trust at the time of
         the transfer.

15.2     Interrelationship of the Plan and the Trust. The provisions of the Plan
         and the Plan  Agreement  shall  govern the rights of a  Participant  to
         receive distributions pursuant to the Plan. The provisions of the Trust
         shall  govern  the  rights  of  the  Employers,  Participants  and  the
         creditors of the Employers to the assets transferred to the Trust. Each
         Employer shall at all times remain liable to carry out its  obligations
         under the Plan.

15.3     Distributions  From the Trust.  Each Employer's  obligations  under the
         Plan may be  satisfied  with Trust assets  distributed  pursuant to the
         terms  of the  Trust,  and  any  such  distribution  shall  reduce  the
         Employer's obligations under this Plan.

                                                    ARTICLE 16
                                                   Miscellaneous

16.1     Unsecured  General  Creditor.  Participants  and  their  Beneficiaries,
         heirs,  successors and assigns shall have no legal or equitable rights,
         interests  or claims in any  property  or  assets of an  Employer.  For
         purposes of the payment of benefits  under this Plan, any and all of an
         Employer's  assets  shall  be,  and  remain,  the  general,   unpledged
         unrestricted assets of the Employer. An Employer's obligation under the
         Plan shall be merely that of an unfunded and  unsecured  promise to pay
         money in the future. If any right of a Participant under the Plan would
         cause  such  Participant  to be in  constructive  receipt  or have  the
         economic benefit of any funds or other assets such that the Participant
         would be subject to federal income taxation in respect of such funds or
         other assets prior to the  Participant's  actual  receipt  thereof as a
         Termination or Retirement Benefit or other payout of benefits under the
         Plan, such right of the  Participant  shall be restricted to the extent
         necessary  so that the  Participant  does not  have  such  constructive
         receipt or economic benefit.

16.2     Employer's  Liability.  An  Employer's  liability  for the  payment  of
         benefits shall be defined only by the Plan and the Plan  Agreement,  as
         entered into between the Employer and a Participant.  An Employer shall
         have no obligation to a Participant  under the Plan except as expressly
         provided in the Plan and his or her Plan Agreement.

16.3     Nonassignability. Neither a Participant nor any other person shall have
         any right to  commute,  sell,  assign,  transfer,  pledge,  anticipate,
         mortgage or  otherwise  encumber,  transfer,  hypothecate,  alienate or
         convey in advance  of actual  receipt,  the  amounts,  if any,  payable
         hereunder,  or any part thereof, which are, and all rights to which are
         expressly  declared to be,  unassignable and  non-transferable,  except
         that the foregoing  shall not apply to any family  support  obligations
         set forth in a court order. No part of the amounts payable shall, prior
         to actual payment,  be subject to seizure,  attachment,  garnishment or
         sequestration  for the  payment  of any  debts,  judgments,  alimony or
         separate maintenance

                                                        23


<PAGE>



         owed by a  Participant  or any other  person,  nor be  transferable  by
         operation of law in the event of a Participant's  or any other person's
         bankruptcy or insolvency.

16.4     Not a Contract of  Employment.  The terms and  conditions  of this Plan
         shall not be deemed to constitute a contract of employment  between the
         Company or any Employer and the Participant.  Such employment is hereby
         acknowledged  to be an "at will"  employment  relationship  that can be
         terminated  at any time for any reason,  or no reason,  with or without
         cause,  and with or without  notice,  unless  expressly  provided  in a
         written employment  agreement.  Nothing in this Plan shall be deemed to
         give a  Participant  the right to be  retained  in the  service  of the
         Company or any Employer or to  interfere  with the right of the Company
         or any Employer to discipline or discharge the Participant at any time.

16.5     Furnishing  Information.  A Participant or his or her Beneficiary  will
         cooperate  with the  Committee by  furnishing  any and all  information
         requested  by the  Committee  and take  such  other  actions  as may be
         requested in order to facilitate the administration of the Plan and the
         payments of  benefits  hereunder,  including  but not limited to taking
         such physical examinations as the Committee may deem necessary.

16.6     Terms. Whenever any words are used herein in the masculine,  they shall
         be  construed  as though  they were in the  feminine in all cases where
         they  would so apply;  and  whenever  any words are used  herein in the
         singular or in the plural,  they shall be construed as though they were
         used in the  plural or the  singular,  as the case may be, in all cases
         where they would so apply.

16.7     Captions. The captions of the articles, sections and paragraphs of this
         Plan are for  convenience  only and shall  not  control  or affect  the
         meaning or construction of any of its provisions.

     16.8 Governing Law.  Subject to ERISA, the provisions of this Plan shall be
construed and interpreted  according to the internal laws of the State of Nevada
without regard to its conflicts of laws principles.

16.9     Notice.  Any notice or filing  required or permitted to be given to the
         Committee  under  this  Plan  shall be  sufficient  if in  writing  and
         hand-delivered, or sent by registered or certified mail, to the address
         below:

                  Sierra Health Services Deferred
                    Compensation Plan Committee

                  P.O. Box 15645
                  Las Vegas, Nevada 89114-5645

         Such notice  shall be deemed  given as of the date of  delivery  or, if
         delivery is made by mail,  as of the date shown on the  postmark on the
         receipt for registration or certification.

                                                        24


<PAGE>



         Any notice or filing required or permitted to be given to a Participant
         under this Plan shall be sufficient  if in writing and  hand-delivered,
         or sent by mail, to the last known address of the Participant.

16.10    Successors.  The  provisions  of this Plan  shall bind and inure to the
         benefit of the  Participant's  Employer and its  successors and assigns
         and the Participant and the Participant's designated Beneficiaries.

16.11    Spouse's  Interest.  The interest in the benefits hereunder of a spouse
         of  a  Participant   who  has   predeceased   the   Participant   shall
         automatically  pass to the Participant and shall not be transferable by
         such spouse in any manner,  including  but not limited to such spouse's
         will,  nor  shall  such  interest  pass  under  the  laws of  intestate
         succession.

16.12    Validity.  In case any  provision  of this  Plan  shall be  illegal  or
         invalid for any reason,  said  illegality or invalidly shall not affect
         the  remaining  parts  hereof,  but this Plan  shall be  construed  and
         enforced  as if such  illegal  or  invalid  provision  had  never  been
         inserted herein.

16.13    Incompetent.  If the  Committee  determines  in its  discretion  that a
         benefit  under  this Plan is to be paid to a minor,  a person  declared
         incompetent  or to a person  incapable of handling the  disposition  of
         that  person's  property,  the  Committee  may  direct  payment of such
         benefit to the guardian, legal representative or person having the care
         and  custody  of such  minor,  incompetent  or  incapable  person.  The
         Committee  may require proof of minority,  incompetency,  incapacity or
         guardianship,  as it may deem appropriate  prior to distribution of the
         benefit. Any payment of a benefit shall be a payment for the account of
         the Participant and the Participant's Beneficiary,  as the case may be,
         and shall be a complete  discharge of any liability  under the Plan for
         such payment amount.

16.14    Court Order. The Committee is authorized to make any payments  directed
         by court  order in any  action in which the Plan or the  Committee  has
         been named as a party. In addition, if a court determines that a spouse
         or former  spouse of a  Participant  has an interest in the Plan as the
         result of a property  settlement or otherwise,  the  Committee,  in its
         sole  discretion,  shall have the right,  notwithstanding  any election
         made by a Participant, to immediately distribute the spouse's or former
         spouse's interest in the Plan to that spouse or former spouse.

16.15    Distribution in the Event of Taxation.

          (a)     In  General.  If,  for any  reason,  all or any  portion  of a
                  Participant's  benefit under this Plan becomes  taxable to the
                  Participant  prior to receipt,  a Participant may petition the
                  Committee  before a Change in  Control,  or the trustee of the
                  Trust after a Change in Control,  for a  distribution  of that
                  portion of his or her benefit  that has become  taxable.  Upon
                  the  grant  of  such a  petition,  which  grant  shall  not be
                  unreasonably  withheld (and, after a Change in Control,  shall
                  be granted), a Participant's  Employer shall distribute to the
                  Participant immediately available

                                                        25


<PAGE>


                  funds in an amount equal to the taxable  portion of his or her
                  benefit (which amount shall not exceed a Participant's Account
                  Balance under the Plan).  If the petition is granted,  the tax
                  liability  distribution  shall be made  within  90 days of the
                  date  when  the  Participant's  petition  is  granted.  Such a
                  distribution  shall  affect and reduce the benefits to be paid
                  under this Plan.

         (b)      Trust.  If the Trust  terminates  in  accordance  with Section
                  3.7(e) of the  Trust and  benefits  are  distributed  from the
                  Trust to a Participant  in accordance  with that Section,  the
                  Participant's benefits under this Plan shall be reduced to the
                  extent of such distributions.

16.16    Legal Fees To Enforce  Rights After Change in Control.  The Company and
         each Employer is aware that upon the occurrence of a Change in Control,
         the Board or the board of directors  of the Employer  (which might then
         be composed  of new  members)  or a  shareholder  of the Company or the
         Employer,  or of any successor  corporation might then cause or attempt
         to cause the  Company,  the  Employer  or such  successor  to refuse to
         comply with its  obligations  under the Plan and might cause or attempt
         to cause the Company or the Employer to  institute,  or may  institute,
         litigation seeking to deny Participants the benefits intended under the
         Plan.  In  these  circumstances,  the  purpose  of the  Plan  could  be
         frustrated.  Accordingly,  if, following a Change in Control, it should
         appear  to any  Participant  that  the  Company,  its  Employer  or any
         successor  corporation has failed to comply with any of its obligations
         under the Plan or any  agreement  thereunder  or, if the Company,  such
         Employer or any other  person takes any action to declare the Plan void
         or  unenforceable  or institutes  any  litigation or other legal action
         designed  to deny,  diminish  or to recover  from any  Participant  the
         benefits  intended to be  provided,  then the Company and the  Employer
         irrevocably  authorize such Participant to retain counsel of his or her
         choice at the  expense of the Company  and the  Employer  (who shall be
         jointly  and  severally   liable)  to  represent  such  Participant  in
         connection  with the  initiation or defense of any  litigation or other
         legal  action,  whether by or against the Company,  the Employer or any
         director,  officer,  shareholder  or other person  affiliated  with the
         Company, the Employer or any successor thereto in any jurisdiction.

                  IN WITNESS  WHEREOF,  the Company has signed this  amended and
restated Plan document as of January 1, 2000.

                                    SIERRA HEALTH SERVICES, INC.,
                              a Nevada corporation

                                    By: __________________________________

                                    Title: _______________________________



                                                        26


<PAGE>