<PAGE>   1
                                                                   EXHIBIT 10.38






                   HORSESHOE GAMING HOLDING CORP. 401(k) PLAN




<PAGE>   2

                         HORSESHOE GAMING HOLDING CORP.
                                  401(K) PLAN


WHEREAS, Horseshoe Gaming Holding Corp. (the "Company") heretofore adopted the
Horseshoe Casino & Hotel 401(k) Plan (the "Plan"); and

WHEREAS, Empress Entertainment, Inc. ("Empress") heretofore adopted the Empress
Entertainment, Inc. 401(k) Plan (the "Empress Plan"); and

WHEREAS, Empress Casino Joliet Corporation ("Empress Joliet") and Empress Casino
Hammond Corporation ("Empress Hammond"), subsidiaries of Empress, heretofore
adopted the Empress Plan for the benefit of their employees; and

WHEREAS, Empress Joliet assumed the obligations as sponsor of the Empress Plan,
and changed the name of the Empress Plan to the "Empress Casino 401(k) Plan",
effective as of December 1, 1999 (with Empress ceasing its participation in the
Plan); and

WHEREAS, the Company acquired Empress Joliet and Empress Hammond as of December
1 1999; and

WHEREAS, the Company and Empress Joliet desire to merge the Empress Plan with
the Plan;

NOW, THEREFORE, effective as of April 1, 2000, the Empress Plan is merged into
the Plan, with the Plan being renamed the "Horseshoe Gaming Holding Corp. 401(k)
Plan" and being amended and restated to read in its entirety as follows:

<PAGE>   3

                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----
ARTICLE ONE--DEFINITIONS

     1.1  Account
     1.2  Administrator
     1.3  Beneficiary
     1.4  Break in Service
     1.5  Code
     1.6  Company
     1.7  Compensation
     1.8  Disability
     1.9  Effective Date
     1.10 Employee
     1.11 Employer
     1.12 Employment Date
     1.13 Empress Plan
     1.14 Highly-Compensated Employee
     1.15 Hour of Service
     1.16 Leased Employee
     1.17 Nonhighly-Compensated Employee
     1.18 Normal Retirement Date
     1.19 Participant
     1.20 Plan
     1.21 Plan Year
     1.22 Trust
     1.23 Trustee
     1.24 Valuation Date
     1.25 Year of Service

ARTICLE TWO--SERVICE DEFINITIONS AND RULES
     2.1  Year of Service
     2.2  Break in Service
     2.3  Maternity/Paternity Leave of Absence
     2.4  Rule of Parity on Return to Employment
     2.5  Service in Excluded Job Classifications or with Related Companies

ARTICLE THREE--PLAN PARTICIPATION
     3.1  Participation
     3.2  Re-employment of Former Participant
     3.3  Termination of Eligibility
     3.4  Compliance with USERRA


                                      (i)

<PAGE>   4

                         TABLE OF CONTENTS (Continued)

                                                                            PAGE
                                                                            ----
ARTICLE FOUR--ELECTIVE DEFERRALS, EMPLOYER CONTRIBUTIONS,
              ROLLOVERS AND TRANSFERS FROM OTHER PLANS
     4.1  Elective Deferrals
     4.2  Employer Contributions
     4.3  Rollovers and Transfers of Funds from Other Plans
     4.4  Timing of Contributions

ARTICLE FIVE--ACCOUNTING RULES
     5.1  Investment of Accounts and Accounting Rules
     5.2  Participants Omitted in Error

ARTICLE SIX--VESTING, RETIREMENT AND DISABILITY BENEFITS
     6.1  Vesting
     6.2  Forfeiture of Nonvested Balance
     6.3  Distribution of Less than Entire Vested Account Balance
     6.4  Normal Retirement
     6.5  Disability

ARTICLE SEVEN--MANNER AND TIME OF DISTRIBUTING BENEFITS
     7.1  Manner of Payment
     7.2  Time of Commencement of Benefit Payments
     7.3  Furnishing Information
     7.4  Minimum Distribution Rules for Installment Payments
     7.5  Amount of Death Benefit
     7.6  Designation of Beneficiary
     7.7  Distribution of Death Benefits
     7.8  Eligible Rollover Distributions

ARTICLE EIGHT--LOANS AND IN-SERVICE WITHDRAWALS
     8.1  Loans
     8.2  Hardship Distributions
     8.3  Withdrawals After Age 59 1/2
     8.4  Withdrawals of Rollover Contributions

ARTICLE NINE--ADMINISTRATION OF THE PLAN
     9.1  Plan Administration
     9.2  Claims Procedure
     9.3  Trust Agreement


                                      (ii)
<PAGE>   5

                         TABLE OF CONTENTS (Continued)

                                                                            PAGE
                                                                            ----
ARTICLE TEN--SPECIAL COMPLIANCE PROVISIONS
    10.1 Distribution of Excess Deferral Amounts
    10.2 Limitations on 401(k) Contributions
    10.3 Nondiscrimination Test for Employer Matching Contributions
    10.4 Limitation on the Multiple Use Alternative

ARTICLE ELEVEN--LIMITATION ON ANNUAL ADDITIONS
    11.1 Rules and Definitions

ARTICLE TWELVE--AMENDMENT AND TERMINATION
    12.1 Amendment
    12.2 Termination of the Plan
    12.3 Distribution Upon Sale or Disposition of Stock or Assets

ARTICLE THIRTEEN--TOP-HEAVY PROVISIONS
    13.1 Applicability
    13.2 Definitions
    13.3 Allocation of Employer Contributions and Forfeitures
         for a Top-Heavy Plan Year
    13.4 Vesting

ARTICLE FOURTEEN--MISCELLANEOUS PROVISIONS
    14.1  Plan Does Not Affect Employment
    14.2  Successor to the Employer
    14.3  Repayments to the Employer
    14.4  Benefits not Assignable
    14.5  Merger of Plans
    14.6  Investment Experience not a Forfeiture
    14.7  Construction
    14.8  Governing Documents
    14.9  Governing Law
    14.10 Headings
    14.11 Counterparts
    14.12 Location of Participant or Beneficiary Unknown


                                     (iii)

<PAGE>   6

                            ARTICLE ONE--DEFINITIONS

For purposes of the Plan, unless the context or an alternative definition
specified within another Article provides otherwise, the following words and
phrases shall have the definitions provided:

1.1   "ACCOUNT" shall mean the individual bookkeeping accounts maintained for a
      Participant under the Plan which shall record (a) the Participant's
      allocations of Employer contributions and forfeitures, (b) amounts of
      Compensation deferred to the Plan pursuant to the Participant's election,
      (c) any amounts transferred to this Plan under Section 4.3 from another
      qualified retirement plan, (d) any amounts transferred from the Empress
      Plan in connection with the merger of such plan and (e) the allocation of
      Trust investment experience.

1.2   "ADMINISTRATOR" shall mean the Company, or such person or committee
      appointed from time to time in accordance with the provisions of Article
      Nine hereof.

1.3   "BENEFICIARY" shall mean any person, trust, organization, or estate
      entitled to receive payment under the terms of the Plan upon the death of
      a Participant.

1.4   "BREAK IN SERVICE" shall have the meaning set forth in Article Two.

1.5   "CODE" shall mean the Internal Revenue Code of 1986, as amended from time
      to time.

1.6   "COMPANY" shall mean Horseshoe Gaming Holding Corp.

1.7   "COMPENSATION" shall mean the compensation paid to a Participant by the
      Employer for the Plan Year, but exclusive of any severance benefits, any
      program of deferred compensation or additional benefits payable other than
      in cash and any compensation received prior to his becoming a Participant
      in the Plan. Compensation shall include any amounts deferred under a
      salary reduction agreement in accordance with Section 4.1 or under a Code
      Section 125 plan maintained by the Employer.

      In addition to other applicable limitations set forth in the Plan, and
      notwithstanding any other provision of the Plan to the contrary, the
      annual Compensation of each Participant taken into account under the Plan
      shall not exceed the OBRA `93 annual compensation limit. Effective as of
      January 1, 2000, the OBRA `93 annual compensation limit is $170,000, as
      adjusted by the Secretary of the Treasury or his delegate for increases in
      the cost of living in accordance with Section 401(a)(17)(B) of the Code.
      The cost-of-living adjustment in effect for a calendar year applies to any
      period, not exceeding twelve (12) months, over which Compensation is
      determined (determination period) beginning in such calendar year. If a
      determination period consists of fewer than twelve (12) months, the OBRA
      `93 annual compensation limit shall be multiplied by a fraction, the
      numerator of which is the number of months in the determination period,
      and the denominator of which is twelve (12).

<PAGE>   7

      Any reference in the Plan to the limitation under Section 401(a)(17) of
      the Code shall mean the OBRA `93 annual compensation limit set forth in
      this provision.

      If Compensation for any prior determination period is taken into account
      in determining a Participant's benefits accruing in the current Plan Year,
      the Compensation for that prior determination period shall be subject to
      the OBRA `93 annual compensation limit in effect for that prior
      determination period.

      For purposes of determining who is a Highly-Compensated Employee,
      Compensation shall mean compensation as defined in Code Section 414(q)(4).

1.8   "DISABILITY" shall mean a "permanent and total" disability incurred by a
      Participant while in the employ of the Employer. For this purpose, a
      permanent and total disability shall mean suffering from a physical or
      mental condition which, in the opinion of the Administrator and based upon
      appropriate medical advice and examination, can be expected to result in
      death or can be expected to last for a continuous period of no less than
      twelve (12) months. The condition must have existed for a period of at
      least three (3) months and, in accordance with uniform and consistent
      rules, must be determined by the Administrator to prevent the Participant
      from engaging in substantial gainful activity. Receipt of a Social
      Security disability award shall be deemed proof of disability.

1.9   "EFFECTIVE DATE." The Effective Date of this restated Plan, on and after
      which it supersedes the terms of the existing Plan document, is April 1,
      2000, except where the provisions of the Plan shall otherwise specifically
      provide. The rights of any Participant who separated from the Employer's
      Service prior to the applicable date shall be established under the terms
      of the Plan or the Horseshoe Plan, as the case may be, as in effect at the
      time of the Participant's separation from Service, unless the Participant
      subsequently returns to Service with the Employer. Rights of spouses and
      Beneficiaries of such Participants shall also be governed by those
      documents.

1.10  "EMPLOYEE" shall mean a common law employee of the Employer.

1.11  "EMPLOYER" shall mean the Company and any subsidiary or affiliate which is
      a member of its "related group" (as defined in Section 2.5) which has
      adopted the Plan (a "Participating Affiliate"), and shall include any
      successor(s) thereto which adopt this Plan. Any such subsidiary or
      affiliate of the Company may adopt the Plan with the approval of its board
      of directors (or noncorporate counterpart) subject to the approval of the
      Company. The provisions of this Plan shall apply equally to each
      Participating Affiliate and its Employees except as specifically set forth
      in the Plan; provided, however, notwithstanding any other provision of
      this Plan, the amount and timing of contributions under Article 4 to be
      made by any Employer which is a Participating Affiliate shall be made
      subject to the approval of the Company. For purposes hereof, each
      Participating Affiliate shall be deemed to have appointed the Company as
      its agent to act on its behalf in all matters


                                       2

<PAGE>   8

      relating to the administration, amendment, termination of the Plan and the
      investment of the assets of the Plan. For purposes of the Code and ERISA,
      the Plan as maintained by the Company and the Participating Affiliates
      shall constitute a single plan rather than a separate plan of each
      Participating Affiliate. All assets in the Trust shall be available to pay
      benefits to all Participants and their Beneficiaries.

1.12  "EMPLOYMENT DATE" shall mean the first date as of which an Employee is
      credited with an Hour of Service, provided that, in the case of a Break in
      Service, the Employment Date shall be the first date thereafter as of
      which an Employee is credited with an Hour of Service.

1.13  "EMPRESS PLAN" shall mean the Empress Casino 401(k) Plan as in effect on
      March 21, 2000.

1.14  "HIGHLY-COMPENSATED EMPLOYEE" shall mean, effective for years beginning
      after December 31, 1996, any Employee of the Employer who:

      (a) was a five percent (5%) owner of the Employer (as defined in Code
          Section 416(i)(1)) during the "determination year" or "look-back
          year"; or

      (b) earned more than $80,000 (as increased by cost-of-living adjustments)
          of Compensation from the Employer during the "look-back year" and, if
          the Employer elects, was in the top twenty percent (20%) of Employees
          by Compensation for such year.

      An Employee who separated from Service prior to the "determination year"
      shall be treated as a Highly-Compensated Employee for the "determination
      year" if such Employee was a Highly-Compensated Employee when such
      Employee separated from Service, or was a Highly-Compensated Employee at
      any time after attaining age fifty-five (55).

      For purposes of this Section, the "determination year" shall be the Plan
      Year for which a determination is being made as to whether an Employee is
      a Highly-Compensated Employee. The "look-back year" shall be the twelve
      (12) month period immediately preceding the "determination year".

      In determining whether an Employee is a Highly-Compensated Employee for
      the Plan Year beginning in 1997, the amendments to Section 414(q) stated
      above shall be treated as having been in effect for the Plan Year
      beginning in 1996.


                                       3
<PAGE>   9

1.15  "HOUR OF SERVICE" shall have the meaning set forth below:

      (a) An Hour of Service is each hour for which an Employee is paid, or
          entitled to payment, for the performance of duties for the Employer,
          during the applicable computation period.

      (b) An Hour of Service is each hour for which an Employee is paid, or
          entitled to payment, by the Employer on account of a period of time
          during which no duties are performed (irrespective of whether the
          employment relationship has terminated) due to vacation, holiday,
          illness, incapacity (including disability), layoff, jury duty,
          military duty, or leave of absence. Notwithstanding the preceding
          sentence,

          (i)   No more than five hundred and one (501) Hours of Service shall
                be credited under this paragraph (b) to any Employee on account
                of any single continuous period during which the Employee
                performs no duties (whether or not such period occurs in a
                single computation period);

          (ii)  An hour for which an Employee is directly or indirectly paid, or
                entitled to payment, on account of a period during which no
                duties are performed shall not be credited to the Employee if
                such payment is made or due under a plan maintained solely for
                the purpose of complying with applicable workmen's compensation,
                or unemployment compensation or disability insurance laws; and

          (iii) Hours of Service shall not be credited for a payment which
                solely reimburses an Employee for medical or medically related
                expenses incurred by the Employee.

          For purposes of this paragraph (b), a payment shall be deemed to be
          made by or due from the Employer regardless of whether such payment is
          made by or due from the Employer directly, or indirectly through,
          among others, a trust fund, or insurer, to which the Employer
          contributes or pays premiums and regardless of whether contributions
          made or due to the trust fund, insurer or other entity are for the
          benefit of particular Employees or are on behalf of a group of
          Employees in the aggregate. In addition, Hours of Service shall be
          credited for a leave which qualified as family or medical leave under
          the Family and Medical Leave Act of 1993 ("FMLA"); provided, however,
          that such Hours of Service shall be credited only to the extent
          required by the FMLA and the regulations thereunder.

      (c) An Hour of Service is each hour for which back pay, irrespective of
          mitigation of damages, is either awarded or agreed to by the Employer.
          The same Hours of Service shall not be credited both under paragraph
          (a) or paragraph (b), as the case may be, and under this paragraph
          (c). Thus, for example, an Employee who receives a back pay award
          following a determination that he was paid at an unlawful rate for
          Hours of Service previously credited shall not be entitled to
          additional credit for the same Hours of Service. Crediting of Hours of
          Service for back pay awarded or agreed to with respect to periods
          described in paragraph (b) shall be subject to the limitations set
          forth in that paragraph.

1.16  "LEASED EMPLOYEE" shall mean, any person who, pursuant to an agreement
      between the Employer and any other person or organization, has performed
      services for the Employer (determined in accordance with Code Section
      414(n)(6)) on a substantially full-time basis for a period of at least one
      (1) year and where such services are performed under the primary direction
      and control of the Employer. A person shall not be considered a Leased
      Employee if the total number of Leased Employees does not exceed twenty
      percent (20%) of the Nonhighly-Compensated Employees employed by the
      Employer, and if any such person is covered by a money purchase pension
      plan providing (a) a nonintegrated employer contribution rate of at least
      ten percent (10%) of compensation, as defined in Section 11.1(b)(2) of the
      Plan but including amounts contributed pursuant to a salary reduction
      agreement which are excludable from the employee's gross income under Code
      Sections 125, 402(g) or 403(b), (b) immediate participation, and (c) full
      and immediate vesting.


                                       4
<PAGE>   10

1.17  "NONHIGHLY-COMPENSATED EMPLOYEE" shall mean an Employee of the Employer
      who is not a Highly-Compensated Employee.

1.18  "NORMAL RETIREMENT DATE" shall mean the date the Participant attains age
      fifty-nine and one-half (59 1/2).

1.19  "PARTICIPANT" shall mean any Employee who has satisfied the eligibility
      requirements of Article Three and who is participating in the Plan.

1.20  "PLAN" shall mean the Horseshoe Gaming Holding Corp. 401(k) Plan, as set
      forth herein and as may be amended from time to time.

1.21  "PLAN YEAR" shall mean the twelve (12)-consecutive month period beginning
      January 1 and ending December 31.

1.22  "TRUST" shall mean the Trust Agreement entered into between the Company
      and the Trustee forming part of this Plan, together with any amendments
      thereto. "Trust Fund" shall mean any and all property held by the Trustee
      pursuant to the Trust Agreement, together with income therefrom.

1.23  "TRUSTEE" shall mean the Trustee or Trustees appointed by the Company, and
      any successors thereto.

1.24  "VALUATION DATE" shall mean the date or dates established by the
      Administrator for the valuation of the assets of the Plan. In no event
      shall the assets of the Plan be valued less frequently than once each Plan
      Year.

1.25  "YEAR OF SERVICE" OR "SERVICE" and the special rules with respect to
      crediting Service are in Article Two of the Plan.


                                       5
<PAGE>   11

                   ARTICLE TWO--SERVICE DEFINITIONS AND RULES

Service is the period of employment credited under the Plan. Definitions and
special rules related to Service are as follows:

2.1   YEAR OF SERVICE. An Employee shall be credited with a Year of Service for
      each twelve (12)-consecutive month period commencing on his Employment
      Date (or re-employment date) and the twelve (12)-month anniversaries of
      that date and ending on the date a Break in Service begins. An Employee
      shall also receive credit for any Break in Service of less than twelve
      (12)-consecutive months. Fractional periods of a year shall be expressed
      in terms of days, with three hundred and sixty-five (365) days being equal
      to one (1) year.

      Provided, however, that, in determining the Years of Service for any
      Employee who was a participant in the Plan as of March 31, 2000, such
      Employee shall be credited with any "Years of Service" completed under the
      Plan through March 31, 2000 in accordance with the provisions of the Plan
      then in effect, subject to the provisions of Section 1.410(a)-7(f)(1)(i)
      of the Income Tax Regulations.

      Finally, any Participant who has a portion of his Account derived from
      amounts transferred from the Empress Plan in connection with the merger of
      the Empress Plan shall be credited with any "Years of Service" completed
      under the Empress Plan.

2.2   BREAK IN SERVICE. A Break in Service is a period of severance of at least
      twelve (12) consecutive months. For this purpose, a period of severance
      shall be a continuous period in which an Employee is not employed by the
      Employer. Such period shall begin on the date the Employee retires, quits,
      is discharged or dies or, if earlier, the twelve (12)-month anniversary of
      the date on which the Employee is absent from Service for any other
      reason.

2.3   MATERNITY/PATERNITY LEAVE OF ABSENCE. For any individual who is absent
      from work for any period by reason of the individual's pregnancy, birth of
      the individual's child, placement of a child with the individual in
      connection with the individual's adoption of the child, or by reason of
      the individual's caring for the child for a period beginning immediately
      following such birth or adoption, the twelve (12)-consecutive month period
      beginning on the first anniversary of the first date of such absence shall
      constitute neither a Break in Service nor a Year of Service.

2.4   RULE OF PARITY ON RETURN TO EMPLOYMENT. An Employee who returns to
      employment after a Break in Service shall retain credit for his pre-Break
      Years of Service, subject to the following rules:

     (a)  If a Participant incurs five (5) or more consecutive one (1)-year
          Breaks in Service, any Years of Service performed thereafter shall not
          be used to increase the nonforfeitable interest in his Account accrued
          prior to such five (5) or more consecutive one (1)-year Breaks in
          Service.

     (b)  If when a Participant incurred a Break in Service, he was not vested
          in any portion of his Account (other than in any rollover
          contributions pursuant to Section 4.3), his pre-Break Years of Service
          shall be disregarded if his consecutive one (1)-year Breaks in Service
          equal or exceed five (5).


                                       6
<PAGE>   12

2.5   SERVICE IN EXCLUDED JOB CLASSIFICATIONS OR WITH RELATED COMPANIES

      (a) Service while a Member of an Ineligible Classification of Employees.
          An Employee who is a member of an ineligible classification of
          Employees shall not be eligible to participate in the Plan while a
          member of such ineligible classification. However, if any such
          Employee is transferred to an eligible classification, such Employee
          shall be credited with any prior periods of Service completed while a
          member of such an ineligible classification both for purposes of
          determining his Years of Service and his "Months of Service" under
          Section 3.1. For this purpose, an Employee shall be considered a
          member of an ineligible classification of Employees for any period
          during which he is employed in a job classification which is excluded
          from participating in the Plan under Section 3.1 below.

      (b) Service with Related Group Members. Subject to Section 2.1, for each
          Plan Year in which the Employer is a member of a "related group", as
          hereinafter defined, all Service of an Employee or Leased Employee
          (hereinafter collectively referred to as "Employee" solely for
          purposes of this Section 2.5(b)) with any one or more members of such
          related group shall be treated as employment by the Employer for
          purposes of determining the Employee's Years of Service and his Months
          of Service under Section 3.1. The transfer of employment by any such
          Employee to another member of the related group shall not be deemed to
          constitute a retirement or other termination of employment by the
          Employee for purposes of this Section, but the Employee shall be
          deemed to have continued in employment with the Employer for purposes
          of determining the Employee's Years of Service and his Months of
          Service. For purposes of this subsection (b), "related group" shall
          mean the Employer and all corporations, trades or businesses (whether
          or not incorporated) which constitute a controlled group of
          corporations with the Employer, a group of trades or businesses under
          common control with the Employer, or an affiliated service group which
          includes the Employer, within the meaning of Section 414(b), Section
          414(c), or Section 414(m), respectively, of the Code or any other
          entity required to be aggregated under Code Section 414(o).

      (c) Construction. This Section is included in the Plan to comply with the
          Code provisions regarding the crediting of Service, and not to extend
          any additional rights to Employees in ineligible classifications other
          than as required by the Code and regulations thereunder.


                                       7
<PAGE>   13

                        ARTICLE THREE--PLAN PARTICIPATION

3.1   PARTICIPATION. All Employees participating in the Plan or the Empress Plan
      as of March 31, 2000 shall automatically become Participants as of April
      1, 2000.

      Each other Employee shall become a Participant under the Plan effective as
      of the April 1, July 1, October 1 or January 1 coincident with or next
      following the Employee's completion of six (6) Months of Service.

      For purposes of this Section 3.1, an Employee shall be credited with six
      (6) Months of Service for each six (6)-month period commencing on his
      Employment Date and the six (6)-month anniversaries of that date and
      ending on the date he separates from Service for any reason. Fractional
      periods shall be aggregated and expressed in terms of days, with thirty
      (30) days being equal to one (1) month. In the event an Employee fails to
      complete the requisite Months of Service during the twelve (12)-month
      period commencing on his Employment Date (or reemployment date), but is
      employed by the Employer on the twelve (12)-month anniversary of that
      date, such Employee shall be deemed to have satisfied the service
      requirement for purposes of participating under the Plan.

      In no event, however, shall any Employee (or other individual) participate
      under the Plan while he is: (i) included in a unit of Employees covered by
      a collective bargaining agreement between the Employer and the Employee
      representatives under which retirement benefits were the subject of good
      faith bargaining, unless the terms of such bargaining agreement expressly
      provides for the inclusion in the Plan; (ii) employed as an independent
      contractor on the payroll records of the Employer (regardless of any
      subsequent reclassification by the Employer, any governmental agency or
      court); (iii) employed as a Leased Employee; (iv) employed as a
      nonresident alien who receives no earned income (within the meaning of
      Section 911(d)(2) of the Code) from the Employer which constitutes income
      from sources within the United States (within the meaning of Section
      861(a)(3) of the Code); or (v) employed as a "special project" Employee.
      The following collective bargaining units have collective bargaining
      agreements that make this Plan applicable to its members: Hotel Employees
      and Restaurant Employees Union, Local 1; and International Union of
      Operating Engineers, Local 150.

3.2   RE-EMPLOYMENT OF FORMER PARTICIPANT. A vested Participant (or a nonvested
      Participant whose prior Service cannot be disregarded) whose participation
      ceased because of termination of employment with the Employer shall resume
      participating upon his reemployment; provided, however, that such an
      individual shall be entitled to commence elective deferrals as soon as
      administratively possible following his return to participation in the
      Plan.

3.3   TERMINATION OF ELIGIBILITY. In the event a Participant is no longer a
      member of an eligible class of Employees and he becomes ineligible to
      participate, such Employee shall resume participating upon his return to
      an eligible class of Employees; provided, however, that such an individual
      shall be entitled to commence elective deferrals as soon as
      administratively possible following his return to participation in the
      Plan.


                                       8
<PAGE>   14

      In the event an Employee who is not a member of an eligible class of
      Employees becomes a member of an eligible class, such Employee shall
      participate upon becoming a member of an eligible class of Employees, if
      such Employee has otherwise satisfied the eligibility requirements of
      Section 3.1 and would have otherwise previously become a Participant;
      provided, however, that such an individual shall be entitled to commence
      elective deferrals as soon as administratively possible following his
      becoming a Participant.

3.4   COMPLIANCE WITH USERRA. Notwithstanding any provision of this Plan to the
      contrary, for reemployments on or after December 12, 1994, Participants
      shall receive service credit and be eligible to make deferrals and receive
      Employer contributions with respect to periods of qualified military
      service (within the meaning of Section 414(u)(5) of the Code) in
      accordance with Section 414(u) of the Code.



                                       9
<PAGE>   15

     ARTICLE FOUR--ELECTIVE DEFERRALS, EMPLOYER CONTRIBUTIONS, AND ROLLOVERS
                         AND TRANSFERS FROM OTHER PLANS

4.1   ELECTIVE DEFERRALS

      (a) Elections. A Participant may elect to defer a portion of his
          Compensation for a Plan Year. The amount of a Participant's
          Compensation that is deferred in accordance with the Participant's
          election shall be withheld by the Employer from the Participant's
          Compensation on a ratable basis throughout the Plan Year; provided,
          however, that a Participant shall be permitted to make a separate
          election not to have any deferrals made with respect to any bonus to
          be paid on his behalf. The amount deferred on behalf of each
          Participant shall be contributed by the Employer to the Plan and
          allocated to the Participant's Account.

          Notwithstanding the foregoing, any Employee, upon first becoming
          eligible to participate in the Plan pursuant to Section 3.1, who fails
          to affirmatively make any deferral election (including an election to
          contribute zero percent (0%) of his Compensation to the Plan) within
          the time prescribed by the Administrator, shall be deemed to have
          elected to contribute two percent (2%) ("deemed elective deferral") of
          his Compensation on a pre-tax basis. The Administrator shall provide
          to each Employee a notice of his right to receive the amount of the
          deemed elective deferral in cash, and the Administrator shall also
          provide each such Employee a reasonable period to exercise such right
          before the date on which the cash is currently available.

      (b) Changes in Election. A Participant may prospectively elect to change
          or revoke the amount (or percentage) of his elective deferrals during
          the Plan Year by filing a written election with the Employer, or via
          such other method as permitted by applicable law.

      (c) Limitations on Deferrals. No Participant shall defer on a pre-tax
          basis an amount which exceeds $10,500 (or such amount as adjusted for
          cost-of-living increases under Section 402(g) of the Code) for any
          calendar year ending with or within the Plan Year.

      (d) Administrative Rules. All elections made under this Section 4.1,
          including the amount and frequency of deferrals, shall be subject to
          the rules of the Administrator which shall be consistently applied and
          which may be changed from time to time.

4.2   EMPLOYER CONTRIBUTIONS

      (a) Employer Matching Contributions. For each Plan Year, the Employer may
          contribute to the Plan, on behalf of each Participant a discretionary
          matching contribution equal to a percentage (as determined by the
          Employer's board of directors) of the elective deferrals made by each
          such Participant. The Employer's board of directors may also determine
          to suspend or reduce its contributions under this Section for any Plan
          Year or any portion thereof. Allocations under this Section shall be
          subject to the special rules of Section 13.3 in any Plan Year in which
          the Plan is a Top-Heavy Plan (as defined in Section 13.2(c)).


                                       10
<PAGE>   16

      (b) Additional Employer Contributions. Additional Employer contributions
          may be made at the discretion of the Employer's board of directors for
          any Plan Year, subject to limits for tax deductions under the Code and
          provided that the special allocation in Section 13.3 has been
          satisfied if the Plan is a Top-Heavy Plan (as defined in Section
          13.2(c)).

      (c) Eligibility for Additional Employer Contributions. To be eligible for
          an allocation of additional Employer contributions under Section
          4.2(b) for a Plan Year, a Participant must (1) have been credited with
          at least one thousand (1,000) Hours of Service in the Plan Year and
          (2) be employed by the Employer on the last day of the Plan Year;
          provided, however, that if the Participant's failure to be employed by
          the Employer on the last day of the Plan Year is due to the
          Participant's Disability, death or retirement on or after his Normal
          Retirement Date during such Plan Year, such Participant shall
          nevertheless be entitled to share in the allocation of any additional
          Employer contributions for such Plan Year.

      (d) Allocation of Additional Employer Contributions. Any contribution made
          under Section 4.2(b) shall be allocated among the Accounts of eligible
          Participants in accordance with the ratio that each such eligible
          Participant's Compensation bears to the total Compensation of all such
          eligible Participants for the Plan Year.

      (e) Notwithstanding anything herein to the contrary, in any situation
          where the exclusion of certain Participants from receiving an
          allocation of any additional Employer contributions hereunder would
          result in the Plan failing to satisfy minimum coverage requirements
          under applicable provisions of the Code or Income Tax Regulations,
          then the following may apply:

          (1) Such affected Non-Highly Compensated Employee Participants shall
              receive an allocation of additional Employer contributions in
              order of priority based upon the number of Hours of Service
              rendered during the Plan Year by each such Participant, so that an
              individual Non-Highly Compensated Employee Participant who has
              rendered more Hours of Service during the Plan Year shall be first
              deemed an eligible Participant, and so on, until the ratio of
              Non-Highly Compensated Employee Participants who receive an
              allocation of additional Employer contributions is at least
              seventy percent (70%) of the percent of Highly-Compensated
              Employee Participants who receive such allocation.

          (2) If two individuals referred to in subsection (1) have the same
              number of Hours of Service, then they shall be deemed eligible
              Participants in order of a priority based upon the earliest
              Employment Date with the Employer.

4.3   ROLLOVERS AND TRANSFERS OF FUNDS FROM OTHER PLANS. With the approval of
      the Administrator, there may be paid to the Trustee amounts which have
      been held under other plans qualified under Code Section 401 either (a)
      maintained by the Employer which have been discontinued or terminated with
      respect to any Employee, or (b) maintained by another employer with
      respect to which any Employee has ceased to participate. Any such transfer
      or rollover may also be made by means of an Individual Retirement Account
      qualified under Section 408 of the Code, where the Individual Retirement
      Account was used as a conduit from the former plan. Any amounts so
      transferred on behalf of any Employee shall be nonforfeitable and shall be
      maintained under a separate Plan account, to be paid in addition to
      amounts otherwise payable under this Plan. The amount of any such account
      shall be equal to the fair market value of such account as adjusted for
      income, expenses, gains, losses and withdrawals attributable thereto.


                                       11
<PAGE>   17

      An Employee who would otherwise be eligible to participate in the Plan but
      for the failure to satisfy the service requirement for participation as
      set forth under Section 3.1, shall be eligible to complete a rollover to
      the Plan. Such an Employee shall also be eligible to obtain a loan or
      withdrawal in accordance with the provisions of Article Eight prior to
      satisfying such service requirement.

4.4   TIMING OF CONTRIBUTIONS. Employer contributions shall be made to the Plan
      no later than the time prescribed by law for filing the Employer's federal
      income tax return (including extensions) for its taxable year ending with
      or within the Plan Year. Elective deferrals under Section 4.1 shall be
      paid to the Plan as soon as administratively possible, but no later than
      the fifteenth (15th) business day of the month following the month in
      which such deferrals would have been payable to the Participant in cash,
      or such later date as permitted or prescribed by the Department of Labor.




                                       12
<PAGE>   18

                         ARTICLE FIVE--ACCOUNTING RULES

5.1   INVESTMENT OF ACCOUNTS AND ACCOUNTING RULES

      (a) Investment Funds. The investment of Participants' Accounts shall be
          made in a manner consistent with the provisions of the Trust. The
          Administrator, in its discretion, may allow the Trust to provide for
          separate funds for the directed investment of each Participant's
          Account.

      (b) Participant Direction of Investments. In the event Participants'
          Accounts are subject to their investment direction, each Participant
          may direct how his Account is to be invested among the available
          investment funds in the percentage multiples established by the
          Administrator. In the event a Participant fails to make an investment
          election, with respect to all or any portion of his Account subject to
          his investment direction, the Trustee shall invest all or such portion
          of his Account in the investment fund to be designated by the
          Administrator. A Participant may change his investment election, with
          respect to future contributions and, if applicable, forfeitures,
          and/or amounts previously accumulated in the Participant's Account in
          accordance with procedures established by the Administrator. Any such
          change in a Participant's investment election shall be effective at
          such time as may be prescribed by the Administrator. If the Plan's
          recordkeeper or investments are changed, the Administrator may apply
          such administrative rules and procedures as are necessary to provide
          for the transfer of records and/or assets, including without
          limitation, the suspension of Participant's investment directions,
          withdrawals and distributions for such period of time as is necessary,
          and the transfer of Participants' Accounts to designated funds or an
          interest bearing account until such change has been completed.

      (c) Allocation of Investment Experience. As of each Valuation Date, the
          investment fund(s) of the Trust shall be valued at fair market value,
          and the income, loss, appreciation and depreciation (realized and
          unrealized), and any paid expenses of the Trust attributable to such
          fund shall be apportioned among Participants' Accounts within the fund
          based upon the value of each Account within the fund as of the
          preceding Valuation Date.

      (d) Allocation of Contributions. Employer contributions shall be allocated
          to the Account of each eligible Participant as of the last day of the
          period for which the contributions are made or as soon as
          administratively practical thereafter.

      (e) Manner and Time of Debiting Distributions. For any Participant who is
          entitled to receive a distribution from his Account, such distribution
          shall be made in accordance with the provisions of Section 7.1 and
          Section 7.2. The amount distributed shall be based upon the fair
          market value of the Participant's vested Account as of the Valuation
          Date preceding the distribution.

5.2   PARTICIPANTS OMITTED IN ERROR. In the event a Participant is not allocated
      a share of the Employer contribution and/or forfeitures as a result of an
      administrative error in any Plan Year, the Employer may elect to either
      (a) make an additional contribution on behalf of such omitted Participant
      in an appropriate amount, or (b) deduct the appropriate amount from any
      forfeitures and allocate such amount to the Participant's Account.


                                       13

<PAGE>   19

            ARTICLE SIX--VESTING, RETIREMENT AND DISABILITY BENEFITS

6.1   VESTING. A Participant shall at all times have a nonforfeitable (vested)
      right to his Account derived from elective deferrals, any Employer
      "fail-safe" contributions under Section 10.2, and any rollovers or
      transfers from other plans, as adjusted for investment experience. In
      addition, any Employee employed by the Employer as of April 1, 2000, who
      was also employed by Empress Entertainment, Inc., Empress Casino Hammond
      Corporation, or Empress Casino Joliet Corporation, on or before July 1,
      1998, shall also have a nonforfeitable vested right to his Account derived
      from any Employer contributions under Sections 4.2(a) and 4.2(b), and any
      employer contributions transferred from the Empress Plan. Except as
      otherwise provided with respect to Normal Retirement, Disability, or
      death, each other Participant shall have a nonforfeitable (vested) right
      to a percentage of the value of his Account derived from Employer
      contributions under Section 4.2(a) and Section 4.2(b) (and any employer
      contributions transferred from the Empress Plan in connection with the
      merger of such plan) as follows:

            YEARS OF SERVICE                         VESTED PERCENTAGE
            ----------------                         -----------------
            Less than 1 year                                  0%
            1 year but less than 2                           25%
            2 years but less than 3                          50%
            3 years but less than 4                          75%
            4 years and thereafter                          100%

6.2   FORFEITURE OF NONVESTED BALANCE. The nonvested portion of a Participant's
      Account, as determined in accordance with Section 6.1, shall be forfeited
      as of the earlier of (i) as soon as administratively practical following
      the date on which the Participant receives distribution of his vested
      Account or (ii) as soon as administratively practical after the last day
      of the Plan Year in which the Participant incurs five (5) consecutive one
      (1)-year Breaks in Service. The amount forfeited shall be used to pay Plan
      expenses and/or used to reduce Employer contributions under Section
      4.2(a)/4.2(b).

      If the Participant returns to the employment of the Employer prior to
      incurring five (5) consecutive one (1)-year Breaks in Service, and prior
      to receiving distribution of his vested Account, the nonvested portion
      shall be restored. However, if the nonvested portion of the Participant's
      Account was allocated as a forfeiture as the result of the Participant
      receiving distribution of his vested Account balance, the nonvested
      portion shall be restored if:

      (a) the Participant resumes employment prior to incurring five (5)
          consecutive one (1)-year Breaks in Service; and

      (b) the Participant repays to the Plan, as of the earlier of (i) the date
          which is five (5) years after his reemployment date or (ii) the date
          which is the last day of the period in which the Participant incurs
          five (5) consecutive one (1)-year Breaks in Service, an amount equal
          to the total distribution derived from Employer contributions under
          Section 4.2 and, if applicable, Section 13.3.

                                       14
<PAGE>   20

      The nonvested amount shall be restored to the Participant's Account,
      without interest or adjustment for interim Trust valuation experience, by
      a special Employer contribution or from the next succeeding Employer
      contribution and forfeitures, as appropriate.

6.3   DISTRIBUTION OF LESS THAN ENTIRE VESTED ACCOUNT BALANCE. If a distribution
      (including a withdrawal) of any portion of a Participant's Account is made
      to the Participant at a time when he has a vested percentage in such
      Account equal to less than one-hundred percent (100%), a separate record
      shall be maintained of said Account balance. The Participant's vested
      interest at any time in this separate account shall be an amount equal to
      the formula P(AB+D)-D, where P is the vested percentage at the relevant
      time, AB is the Account balance at the relevant time, and D is the amount
      of the distribution (or withdrawal) made to the Participant.

6.4   NORMAL RETIREMENT. A Participant who is in the employment of the Employer
      at his Normal Retirement Date shall have a nonforfeitable interest in one
      hundred percent (100%) of his Account, if not otherwise one hundred
      percent (100%) vested under the vesting schedule in Section 6.1. A
      Participant who continues employment with the Employer after his Normal
      Retirement Date shall continue to participate under the Plan.

6.5   DISABILITY. If a Participant incurs a Disability, the Participant shall
      have a nonforfeitable interest in one hundred percent (100%) of his
      Account, if not otherwise one hundred percent (100%) vested under the
      vesting schedule in Section 6.1. Payment of such Participant's Account
      balance shall be made at the time and in the manner specified in Article
      Seven, following receipt by the Administrator of the Participant's written
      distribution request.



                                       15
<PAGE>   21

             ARTICLE SEVEN--MANNER AND TIME OF DISTRIBUTING BENEFITS

7.1   MANNER OF PAYMENT. The Participant's vested Account shall be distributed
      to the Participant (or to the Participant's Beneficiary in the event of
      the Participant's death) by either of the following methods, (or a
      combination thereof), as elected by the Participant or, when applicable,
      the Participant's Beneficiary:

      (a) in a single lump-sum payment; or

      (b) provided the Participant's vested Account exceeds $3,500 (or,
          effective May 1, 1999, $5,000), in periodic installments (at least
          annual), subject to the minimum distribution rules of Section 7.4.

7.2   TIME OF COMMENCEMENT OF BENEFIT PAYMENTS. Subject to the following
      provisions of this Section, at the election of the Participant,
      distribution of the Participant's vested Account shall be made or commence
      no later than the sixtieth (60) day after the later of the close of the
      Plan Year in which: (a) the Participant attains age sixty-five (65) (or
      Normal Retirement Date, if earlier) or (b) the date the Participant
      terminates Service with the Employer.

      Notwithstanding the foregoing, if the Participant's vested Account has
      does not exceeded $3,500 (or, effective May 1, 1999, $5,000), the
      Participant's vested Account shall be distributed to the Participant (or,
      in the event of the Participant's death, his Beneficiary) in a lump-sum
      payment as soon as administratively practicable following the date the
      Participant retires, dies or otherwise separates from Service.

      Notwithstanding any provision contained herein to the contrary, a
      Participant who is not vested in any portion of his Account balance
      attributable to Employer contributions shall be deemed to have received
      distribution of such portion of his Account as of the end of the Plan Year
      following the Plan Year in which he separates from Service.

      For years beginning after December 31, 1996, in no event shall
      distribution of the Participant's vested Account be made or commence later
      than the April 1st following the end of the calendar year in which the
      Participant attains age seventy and one-half (70 1/2), or, except for a
      Participant who is a five percent (5%) owner of the Employer (within the
      meaning of Section 401(a)(9) of the Code), if later, the April 1st
      following the calendar year in which the Participant retires or otherwise
      separates from Service. Notwithstanding the foregoing, the provisions of
      this paragraph shall be subject to any prior election complying with the
      provisions of Section 242(b) of TEFRA. In addition, any Participant
      attaining age seventy and one-half (70 1/2) prior to January 1, 1999 may
      elect to receive distribution of his vested Account in accordance with the
      provisions of this Article Seven.

7.3   FURNISHING INFORMATION. Prior to the payment of any benefit under the
      Plan, each Participant or Beneficiary may be required to complete such
      administrative forms and furnish such proof as may be deemed necessary or
      appropriate by the Employer, Administrator, and/or Trustee.


                                       16
<PAGE>   22

7.4   MINIMUM DISTRIBUTION RULES FOR INSTALLMENT PAYMENTS. If a distribution is
      made in installments the following rules shall apply:

      (a) Payments to Participant or to Participant and Surviving Spouse.
          Payment shall commence no later than a date provided for in Section
          7.2. The amount to be distributed each year shall be at least equal to
          the vested balance in the Participant's Account as of the preceding
          Valuation Date multiplied by the following fraction: the numerator
          shall be one (1) and the denominator shall be the life expectancy of
          the Participant (or the joint life expectancies of the Participant and
          the Participant's spouse) determined as of the Valuation Date
          preceding the first payment and reduced by one for each succeeding
          year.

      (b) Payments to Participant and Non-Spouse Beneficiary. Payment shall
          commence no later than a date provided for in Section 7.2. The amount
          to be distributed each year shall be at least equal to the vested
          balance in the Participant's Account as of the preceding Valuation
          Date multiplied by the following fraction: the numerator shall be one
          (1) and the denominator shall be the joint life expectancies of the
          Participant and the Participant's Beneficiary computed as of the
          Valuation Date preceding the first payment and reduced by one (1) for
          each succeeding year. Payments shall be restricted under this option
          to insure compliance with the minimum distribution incidental death
          benefit requirement of Section 401(a)(9) of the Code and the
          regulations promulgated thereunder.

      (c) Payments to Beneficiary. Payment shall commence no later than a date
          provided for in Section 7.7. The amount to be distributed each year
          shall be at least equal to the vested balance in the Participant's
          Account as of the preceding Valuation Date multiplied by the following
          fraction: the numerator shall be one (1) and the denominator shall be
          the life expectancy of the Participant's Beneficiary computed as of
          the Valuation Date preceding the first payment and reduced by one (1)
          for each succeeding year.

      (d) Recalculation of Life Expectancy. If distribution is to be made over
          the life expectancy of the Participant or, where the Participant's
          spouse is his Beneficiary, the life expectancy of the Participant's
          surviving spouse, or the joint life expectancies of the Participant
          and his spouse, such life expectancy or joint life expectancies shall
          not be recalculated; provided, however, that a Participant who has
          commenced receiving payments pursuant to the last paragraph of Section
          7.2 may elect to recalculate his life expectancy or the joint life
          expectancy of the Participant and his spouse where applicable. Any
          such election shall be irrevocable as to the Participant (and spouse,
          if applicable) and shall apply to all subsequent years. In no event,
          however, shall the life expectancy of a non-spouse Beneficiary be
          recalculated.

7.5   AMOUNT OF DEATH BENEFIT

      (a) Death Before Termination of Employment. In the event of the death of a
          Participant while in the employ of the Employer, vesting in the
          Participant's Account shall be one hundred percent (100%), if not
          otherwise one hundred percent (100%) vested under Section 6.1, with
          the credit balance of the Participant's Account being payable to his
          Beneficiary.

      (b) Death After Termination of Employment. In the event of the death of a
          former Participant after termination of employment, but prior to the
          complete distribution of his vested Account balance under the Plan,
          the undistributed vested balance of the Participant's Account shall be
          paid to the Participant's Beneficiary.




                                       17
<PAGE>   23

7.6   DESIGNATION OF BENEFICIARY. Each Participant shall file with the
      Administrator a designation of Beneficiary to receive payment of any death
      benefit payable hereunder if such Beneficiary should survive the
      Participant. However, no Participant who is married shall be permitted to
      designate a Beneficiary other than his spouse unless the Participant's
      spouse has signed a written consent (witnessed by a Plan representative or
      a notary public), which provides for the designation of an alternate
      Beneficiary.

      Subject to the above, Beneficiary designations may include primary and
      contingent Beneficiaries, and may be revoked or amended at any time in
      similar manner or form, and the most recent designation shall govern. A
      designation of a Beneficiary made by an unmarried Participant shall cease
      to be effective upon his marriage. In the absence of an effective
      designation of Beneficiary, the Participant's vested Account shall be paid
      to the surviving spouse of the Participant, or, if no surviving spouse, to
      the Participant's estate. Notification to Participants of the death
      benefits under the Plan and the method of designating a Beneficiary shall
      be given at the time and in the manner provided by regulations and rulings
      under the Code.

      In the event of the death of a Beneficiary who has become entitled to
      receive benefits under the Plan, any benefits remaining to be paid to the
      Beneficiary shall be paid to his estate.

7.7   DISTRIBUTION OF DEATH BENEFITS., The Beneficiary shall be allowed to
      designate the mode of receiving benefits in accordance with Section 7.1,
      unless the Participant had designated a method in writing and indicated
      that the method was not revocable by the Beneficiary.

      (a) Distribution Beginning Before Death - If the Participant dies after
          distribution of his vested Account has commenced, any survivor's
          benefit must be paid at least as rapidly as under the method of
          payment in effect at the time of the Participant's death.

      (b) Distribution Beginning After Death - If the Participant dies before
          distribution of his vested Account has commenced, distribution of the
          Participant's vested Account shall be completed by December 31 of the
          calendar year containing the fifth anniversary of the Participant's
          death, except as provided below:

          (i)  if any portion of the Participant's vested Account is payable to
               a designated Beneficiary, and if distribution is to be made over
               the life or over a period certain not greater than the life
               expectancy of the designated Beneficiary (pursuant to the
               provisions of Section 7.1 above) such payments shall commence on
               or before December 31 of the calendar year immediately following
               the calendar year in which the Participant died;

          (ii) if the designated Beneficiary is the Participant's surviving
               spouse, the date distribution is required to begin shall not be
               earlier than the later of (A) December 31 of the calendar year
               immediately following the calendar year in which the Participant
               died and (B) December 31 of the calendar year in which the
               Participant would have attained age seventy and one-half
               (70 1/2).

                                       18
<PAGE>   24

          For purposes of this paragraph (b), if the surviving spouse dies after
          the Participant, but before payments to such spouse begin, the
          provisions of this paragraph, with the exception of paragraph (ii)
          herein, shall be applied as if the surviving spouse were the
          Participant.

          Notwithstanding the foregoing, if the Participant has no designated
          Beneficiary (within the meaning of Section 401(a)(9) of the Code and
          the regulations thereunder), distribution of the Participant's vested
          Account must be completed by December 31 of the calendar year
          containing the fifth anniversary of the Participant's death.

7.8   ELIGIBLE ROLLOVER DISTRIBUTIONS. Notwithstanding the foregoing provisions
      of this Article Seven, the provisions of this Section 7.8 shall apply to
      distributions made under the Plan.

      (a) A distributee may elect, at the time and in the manner prescribed by
          the Administrator, to have any portion of an eligible rollover
          distribution paid directly to an eligible retirement plan specified by
          the distributee in a direct rollover.

      (b) Definitions:

          (i)   Eligible Rollover Distribution. An eligible rollover
                distribution is any distribution of all or any portion of the
                balance to the credit of the distributee, except that an
                eligible rollover distribution does not include: any
                distribution that is one of a series of substantially equal
                periodic payments (not less frequently than annually) made for
                the life (or life expectancy) of the distributee or the joint
                lives (or joint life expectancies) of the distributee and the
                distributee's designated Beneficiary, or for a specified period
                of ten (10) years or more; any distribution to the extent such
                distribution is required under Section 401(a)(9) of the Code;
                any withdrawals of elective deferrals pursuant to Section 8.2;
                and the portion of any distribution that is not includable in
                gross income (determined without regard to the exclusion for net
                unrealized appreciation with respect to employer securities).

          (ii)  Eligible Retirement Plan. An eligible retirement plan is an
                individual retirement account described in Section 408(a) of the
                Code, an individual retirement annuity described in Section
                408(b) of the Code, an annuity plan described in Section 403(a)
                of the Code or a qualified trust described in Section 401(a) of
                the Code, that accepts the distributee's eligible rollover
                distribution. However, in the case of an eligible rollover
                distribution to the surviving spouse, an eligible retirement
                plan is an individual retirement account or individual
                retirement annuity.

          (iii) Distributee. A distributee includes an Employee or former
                Employee. In addition, the Employee's or former Employee's
                surviving spouse and the Employee's or former Employee's spouse
                or former spouse who is the alternate payee under a qualified
                domestic relations order, as defined in Section 414(p) of the
                Code, are distributees with regard to the interest of the spouse
                or former spouse.

          (iv)  Direct Rollover. A direct rollover is a payment by the Plan to
                the eligible retirement plan specified by the distributee.

      (c) If a distribution is one to which Sections 401(a)(11) and 417 of the
          Code do not apply, such distribution may commence less than thirty
          (30) days after the notice required under Section 1.411(a)-11(c) of
          the Income Tax Regulations is given, provided that:

          (i)   the Administrator clearly informs the Participant that the
                Participant has a right to a period of at least thirty (30) days
                after receiving the notice to consider the decision of whether
                or not to elect a distribution (and, if applicable, a particular
                distribution option), and

          (ii)  the Participant, after receiving the notice, affirmatively
                elects a distribution.


                                       19
<PAGE>   25

                 ARTICLE EIGHT--LOANS AND IN-SERVICE WITHDRAWALS

8.1   LOANS

      (a) Permissible Amount and Procedures. Upon the application of a
          Participant, the Administrator may, in accordance with a uniform and
          nondiscriminatory policy, direct the Trustee to grant a loan to the
          Participant, which loan shall be secured by the Participant's vested
          Account balance. The Participant's signature shall be required on a
          promissory note. In addition, if the Participant is married, such
          Participant's spouse shall be required to consent in writing to the
          making of the loan. Such written consent must (1) be obtained within
          the ninety (90)-day period preceding the granting of the loan, (2)
          acknowledge the effect of the loan, and (3) be witnessed by a Plan
          representative or notary public. Such consent shall thereafter be
          binding with respect to the consenting spouse or any subsequent spouse
          with respect to that loan. In determining a rate of interest on such
          loan, the Administrator may refer to the rate of interest used for
          obligations of a comparable nature by commercial lending institutions
          within a radius of fifty (50) miles of the Employer's principal place
          of business. Participant loans shall be treated as segregated
          investments, and interest repayments shall be credited only to the
          Participant's Account.

      (b) Limitation on Amount of Loans. A Participant's loan shall not exceed
          the lesser of:

          (1) $50,000, which amount shall be reduced by the highest outstanding
              loan balance during the preceding twelve (12)-month period; or

          (2) one-half (1/2) of the vested value of the Participant's Account,
              determined as of the Valuation Date preceding the date of the
              Participant's loan.

      Any loan must be repaid within five (5) years, unless made for the purpose
      of acquiring the primary residence of the Participant, in which case such
      loan may be repaid over a longer period of time not to exceed twenty (20)
      years. The repayment of any loan must be made in at least quarterly
      installments of principal and interest; provided, however, that this
      requirement shall not apply for a period, not longer than one year, that a
      Participant is on a leave of absence ("Leave"), either without pay from
      the Employer or at a rate of pay (after income and employment tax
      withholding) that is less than the amount of the installment payments
      required under the terms of the loan. However, the loan must be repaid by
      the latest date permitted under Section 72(p)(2)(B) of the Code and the
      installments due after the Leave ends (or, if earlier, upon the expiration
      of the first year of the Leave) must not be less than those required under
      the terms of the original loan.

      If a Participant defaults on any outstanding loan, the unpaid balance, and
      any interest due thereon, shall become due and payable in accordance with
      the terms of the underlying promissory note; provided, however, that such
      foreclosure on the promissory note and attachment of security shall not
      occur until a distributable event occurs in accordance with the provisions
      of Article Seven.

      If a Participant terminates employment while any loan balance is
      outstanding, the unpaid balance, and any interest due thereon, shall
      become due and payable in accordance with the terms of the underlying
      promissory note. If such amount is not paid to the Plan, it shall be
      charged against the amounts that are otherwise payable to the Participant
      or the Participant's Beneficiary under the provisions of the Plan.


                                       20
<PAGE>   26

      Notwithstanding the foregoing provisions of this Section, no loan shall be
      made to any Participant who is a five percent (5%) or greater
      shareholder-employee of an electing small business (Subchapter S)
      corporation, an owner of more than ten percent (10%) of either the capital
      interest or the profits interest of an unincorporated Employer, or a
      family member (as defined in Section 267(c)(4) of the Code) of such
      Participant, unless an exemption for the loan is obtained pursuant to
      Section 408 of the Employee Retirement Income Security Act of 1974, as
      amended.

      In the case of a Participant who has loans outstanding from other plans of
      the Employer (or a member of the Employer's related group (within the
      meaning of Section 2.5(b)), the Administrator shall be responsible for
      reporting to the Trustee the existence of said loans in order to aggregate
      all such loans within the limits of Section 72(p) of the Code.

8.2   HARDSHIP DISTRIBUTIONS. In the case of a financial hardship resulting from
      a proven immediate and heavy financial need, a Participant may with his
      spouse's written consent, if applicable, (which consent must either be
      notarized or witnessed by a Plan representative) receive a distribution
      not to exceed the lesser of (i) the vested value of the Participant's
      Account, without regard to earnings on his elective deferrals after
      December 31, 1988, and without regard to any "fail safe" contributions
      made under Section 10.2, or (ii) the amount necessary to satisfy the
      financial hardship. The amount of any such immediate and heavy financial
      need may include any amounts necessary to pay federal, state or local
      income taxes reasonably anticipated to result from the distribution. Such
      distribution shall be made in accordance with nondiscriminatory and
      objective standards consistently applied by the Administrator.

      Hardship distributions under this Section shall be deemed to be the result
      of an immediate and heavy financial need if such distribution is to (a)
      pay expenses for medical care (as described in Section 213(d) of the Code)
      previously incurred by the Participant, the Participant's spouse, or any
      dependents of the Participant (as defined in Section 152 of the Code), or
      to permit the Participant, the Participant's spouse, or any dependents of
      the Participant to obtain such medical care, (b) purchase the principal
      residence of the Participant (excluding mortgage payments), (c) pay
      tuition and related educational fees for the next twelve (12) months of
      post-secondary education for the Participant, Participant's spouse, or any
      of the Participant's dependents or (d) prevent the eviction of the
      Participant from his principal residence or foreclosure on the
      Participant's principal residence. In addition, any hardship distribution
      hereunder shall only be made provided that the funds for such hardship are
      not available from other financial resources of the Participant, the
      Participant's spouse or the Participant's minor children. Distributions
      paid pursuant to this Section shall be deemed to be made as of the
      Valuation Date immediately preceding the hardship distribution, and the
      Participant's Account shall be reduced accordingly.

      The provisions of this Section (relating to hardship distributions) are
      intended to comply with Treasury Regulations issued under Section 401(k)
      of the Code, and shall be so interpreted.



                                       21
<PAGE>   27

8.3   WITHDRAWALS AFTER AGE 59 1/2. After attaining age fifty-nine and one-half
      (59 1/2), a Participant, by giving written notice to the Administrator,
      may with his spouse's written consent, if applicable, (which consent must
      either be notarized or witnessed by a Plan representative) withdraw from
      the Plan a sum (a) not in excess of the credit balance of his vested
      Account and (b) not less than such minimum amount as the Administrator may
      establish from time to time to facilitate administration of the Plan. Any
      such withdrawals shall be made in accordance with nondiscriminatory and
      objective standards consistently applied by the Administrator.

8.4   WITHDRAWALS OF ROLLOVER CONTRIBUTIONS. A Participant, by giving written
      notice to the Administrator, may with his spouse's written consent, if
      applicable, (which consent must either be notarized or witnessed by a Plan
      representative) withdraw from the Plan a sum (a) not in excess of the
      credit balance of the Participant's Account attributable to his rollover
      contributions and (b) not less than such minimum amount as the
      Administrator may establish from time to time to facilitate administration
      of the Plan. Any such withdrawals shall be made in accordance with
      nondiscriminatory and objective standards consistently applied by the
      Administrator.


                                       22
<PAGE>   28

                    ARTICLE NINE --ADMINISTRATION OF THE PLAN

9.1   PLAN ADMINISTRATION. The Company shall be the Plan Administrator,
      hereinbefore and hereinafter called the Administrator, and "named
      fiduciary" (for purposes of Section 402(a)(1) of the Employee Retirement
      Income Security Act of 1974, as amended from time to time) of the Plan,
      unless the Company, by action of its board of directors, shall designate a
      person or committee of persons to be the Administrator and named
      fiduciary. The administration of the Plan, as provided herein, including a
      determination of the payment of benefits to Participants and their
      Beneficiaries, shall be the responsibility of the Administrator; provided,
      however, that the Administrator may delegate any of its powers, authority,
      duties or responsibilities to any person or committee of persons. The
      Administrator shall have full discretion to interpret the terms of the
      Plan, to determine factual questions that arise in the course of
      administering the Plan, to adopt rules and regulations regarding the
      administration of the Plan, to determine the conditions under which
      benefits become payable under the Plan, to determine eligibility under the
      Plan and to make any other determinations that the Administrator believes
      are necessary and advisable for the administration of the Plan. Benefits
      under the Plan will be paid to any Participant only if the Administrator
      determines that the Participant is entitled to such benefits. Any
      determination made by the Administrator shall be final and binding on all
      parties.

      In the event more than one party shall act as Administrator, all actions
      shall be made by majority decisions. In the administration of the Plan,
      the Administrator may (a) employ agents to carry out nonfiduciary
      responsibilities (other than Trustee responsibilities), (b) consult with
      counsel, who may be counsel to the Company, and (c) provide for the
      allocation of fiduciary responsibilities (other than Trustee
      responsibilities) among its members. Actions dealing with fiduciary
      responsibilities shall be taken in writing and the performance of agents,
      counsel and fiduciaries to whom fiduciary responsibilities have been
      delegated shall be reviewed periodically.

      The expenses of administering the Plan and the compensation of all
      employees, agents, or counsel of the Administrator, including accounting
      fees, recordkeeper's fees, and the fees of any benefit consulting firm,
      shall be paid by the Plan, or shall be paid by the Company if the Company
      so elects. To the extent required by applicable law, compensation may not
      be paid by the Plan to full-time Employees of the Company.

      In the event the Company pays the expenses of administering the Plan, the
      Company may seek reimbursement from the Plan for the payment of such
      expenses. Reimbursement shall be permitted only for Plan expenses paid by
      the Company within the last twelve (12)-month period.

      The Administrator shall obtain from the Trustee, not less often than
      annually, a report with respect to the value of the assets held in the
      Trust Fund, in such form as may be required by the Administrator.

      The Administrator shall administer the Plan and adopt such rules and
      regulations as, in the opinion of the Administrator, are necessary or
      advisable to implement and administer the Plan and to transact its
      business.



                                       23
<PAGE>   29
9.2   CLAIMS PROCEDURE

      (a) Pursuant to procedures established by the Administrator, claims for
          benefits under the Plan made by a Participant or Beneficiary (the
          "claimant") must be submitted in writing to the Administrator.
          Approved claims shall be processed and instructions issued to the
          Trustee or custodian authorizing payment as claimed.

          If a claim is denied in whole or in part, the Administrator shall
          notify the claimant whose claim for benefit has been denied within
          ninety (90) days after receipt of the claim (or within one hundred
          eighty (180) days, if special circumstances require an extension of
          time for processing the claim, and provided written notice indicating
          the special circumstances and the date by which a final decision is
          expected to be rendered is given to the claimant within the initial
          ninety (90) day period). If notification is not given in such period,
          the claim shall be considered denied as of the last day of such period
          and the claimant may request a review of the claim.

          The notice of the denial of the claim shall be written in a manner
          calculated to be understood by the claimant and shall set forth the
          following:

          (i)   the specific reason or reasons for the denial of the claim;

          (ii)  the specific references to the pertinent Plan provisions on
                which the denial is based;

          (iii) a description of any additional material or information
                necessary to perfect the claim, and an explanation of why such
                material or information is necessary; and

          (iv)  a statement that any appeal of the denial must be made by giving
                to the Administrator, within sixty (60) days after receipt of
                the denial of the claim, written notice of such appeal, such
                notice to include a full description of the pertinent issues and
                basis of the claim.

      (b) Upon denial of a claim in whole or part, the claimant (or his duly
          authorized representative) shall have the right to submit a written
          request to the Administrator for a full and fair review of the denied
          claim, to be permitted to review documents pertinent to the denial,
          and to submit issues and comments in writing. Any appeal of the denial
          must be given to the Administrator within the period of time
          prescribed under (a)(iv) above. If the claimant (or his duly
          authorized representative) fails to appeal the denial to the
          Administrator within the prescribed time, the Administrator's adverse
          determination shall be final, binding and conclusive and the claimant
          shall have no right to further review or to bring a claim in a court
          of law or equity.

          The Administrator may hold a hearing or otherwise ascertain such facts
          as it deems necessary and shall render a decision which shall be
          binding upon both parties. The Administrator shall advise the claimant
          of the results of the review within sixty (60) days after receipt of
          the written request for the review, unless special circumstances
          require an extension of time for processing, in which case a decision
          shall be rendered as soon as possible but not later than one hundred
          twenty (120) days after receipt of the request for review. If such
          extension of time is required, written notice of the extension shall
          be furnished to the claimant prior to the commencement of the
          extension. The decision of the review shall be written in a manner
          calculated to be understood by the claimant and shall include specific
          reasons for the decision and specific references to the pertinent Plan
          provisions on which the decision is based. The decision of the
          Administrator shall be final, binding and conclusive.

9.3   TRUST AGREEMENT. The Trust Agreement entered into by and between the
      Employer and the Trustee, including any supplements or amendments thereto,
      or any successor Trust Agreement, is incorporated by reference herein.



                                       24
<PAGE>   30

                   ARTICLE TEN--SPECIAL COMPLIANCE PROVISIONS

10.1  DISTRIBUTION OF EXCESS DEFERRAL AMOUNTS. Notwithstanding any other
      provision of the Plan, "Excess Deferral Amounts" (as defined below) (and
      income or loss allocable thereto, including all earnings, expenses and
      appreciation or depreciation in value, whether or not realized) shall be
      distributed no later than each April 15 to Participants who claim Excess
      Deferral Amounts for the preceding calendar year.

      "Excess Deferral Amount" shall mean the amount of elective deferrals for a
      calendar year that the Participant designates to the Plan pursuant to the
      following procedure. The Participant's designation: shall be submitted to
      the Administrator in writing no later than March 1; shall specify the
      Participant's Excess Deferral Amount for the preceding calendar year; and
      shall be accompanied by the Participant's written statement that if the
      Excess Deferral Amount is not distributed, it will, when added to amounts
      deferred under other plans or arrangements described in Section 401(k),
      408(k) or 403(b) of the Code, exceed the limit imposed on the Participant
      by Section 402(g) of the Code for the year in which the deferral occurred.

      An Excess Deferral Amount, and the income or loss allocable thereto, may
      be distributed before the end of the calendar year in which the elective
      deferrals were made. A Participant who has an Excess Deferral Amount for a
      taxable year, taking into account only his elective deferrals under the
      Plan or any other plans of the Employer (including any member of the
      Employer's related group (within the meaning of Section 2.5(b)), shall be
      deemed to have designated the entire amount of such Excess Deferral
      Amount.

10.2  LIMITATIONS ON 401(K) CONTRIBUTIONS.

      (a) Average Actual Deferral Percentage Test. Amounts contributed as
          elective deferrals under Section 4.1(a), and any "fail-safe"
          contributions made under this Section, are considered to be amounts
          deferred pursuant to Section 401(k) of the Code. For purposes of this
          Section, these amounts are referred to as the "deferred amounts." For
          purposes of the "average actual deferral percentage test" described
          below, (i) such deferred amounts must be made before the last day of
          the twelve (12)-month period immediately following the Plan Year to
          which the contributions relate, and (ii) the deferred amounts relate
          to Compensation that either (A) would have been received by the
          Participant in the Plan Year but for the Participant's election to
          make deferrals, or (B) is attributable to services performed by the
          Participant in the Plan Year but for the Participant's election to
          make deferrals, would have been received by the Participant within two
          and one-half (2 1/2) months after the close of the Plan Year. The
          Employer shall maintain records sufficient to demonstrate satisfaction
          of the average actual deferral percentage test and the deferred
          amounts used in such test.



                                       25
<PAGE>   31

          Effective for Plan Years beginning on or after January 1, 1997, as of
          the last day of each Plan Year, the deferred amounts for the
          Participants who are Highly-Compensated Employees for the Plan Year
          shall satisfy either of the following tests:

          (1) The average actual deferral percentage for the eligible
              Participants who are Highly-Compensated Employees for the Plan
              Year shall not exceed the average actual deferral percentage for
              eligible Participants who were Nonhighly-Compensated Employees for
              the prior Plan Year multiplied by 1.25; or

          (2) The average actual deferral percentage for eligible Participants
              who are Highly-Compensated Employees for the Plan Year shall not
              exceed the average actual deferral percentage of eligible
              Participants who were Nonhighly-Compensated Employees for the
              prior Plan Year multiplied by two (2), provided that the average
              actual deferral percentage for eligible Participants who are
              Highly-Compensated Employees for the Plan Year does not exceed the
              average actual deferral percentage for eligible Participants who
              were Nonhighly-Compensated Employees in the prior Plan Year by
              more than two (2) percentage points, or such lesser amount as the
              Secretary of the Treasury shall prescribe to prevent the multiple
              use of this alternative limitation with respect to any
              Highly-Compensated Employee.

          Notwithstanding the foregoing, if elected by the Employer in a formal
          amendment to the Plan, the foregoing percentage tests shall be applied
          as though the references therein to "the prior Plan Year" read "such
          Plan Year;" provided, however, the change in testing methods complies
          with the requirements set forth in Notice 98-1 and any other
          superseding guidance. Such election was made under the Plan and the
          Empress Plan for the 1997, 1998 and 1999 Plan Years.

          Effective for testing years beginning January 1, 1999, in the event
          the Plan changes from the current year testing method to the prior
          year testing method, then, for purposes of the first testing year for
          which the change is effective, the average actual deferral percentage
          for Nonhighly-Compensated Employees for the prior year shall be
          determined by taking into account only (a) elective deferrals for
          those Nonhighly-Compensated Employees that were taken into account for
          purposes of the average actual deferral percentage test (and not the
          actual contribution percentage test) under the current year testing
          method for the prior year and (b) any qualified nonelective
          contributions that were allocated to the Accounts of those
          Nonhighly-Compensated Employees for the prior year but were not used
          to satisfy the actual average deferral percentage test or the average
          contribution percentage test under the current year testing method for
          the prior year.

          In the event the Plan changes from the current year to the prior year
          testing method for the first time for either the 1997 or 1998 testing
          year, the average actual deferral percentage for Nonhighly-Compensated
          Employees used for that testing year shall be the same as the average
          actual deferral percentage for Nonhighly-Compensated Employees used
          for the prior testing year.

          For purposes of the above tests, the "actual deferral percentage"
          shall mean the ratio (expressed as a percentage) that the deferred
          amounts, which are allocated to the Participant's Account as of any
          day in the Plan Year, on behalf of each eligible Participant for the
          Plan Year bears to the eligible Participant's compensation (within the
          meaning of Section 1.414(s)-1(d)(2) of the Income Tax Regulations) for
          the Plan Year. The "average actual deferral percentage" shall mean the
          average (expressed as a percentage) of the actual deferral percentages
          of the eligible Participants in each group. "Eligible Participant"
          shall mean each Employee who is eligible to participate in the Plan
          under Section 3.1.


                                       26
<PAGE>   32

          For purposes of this Section 10.2, the actual deferral percentage for
          any eligible Participant who is a Highly-Compensated Employee for the
          Plan Year and who is eligible to have elective deferrals allocated to
          his account under two (2) or more plans or arrangements described in
          Code Section 401(k) that are maintained by the Employer or any
          employer who is a related group member (within the meaning of Section
          2.5(b)) shall be determined as if all such deferrals were made under a
          single arrangement. In the event that this Plan satisfies the
          requirements of Code Section 401(k), 401(a)(4) or 410(b) only if
          aggregated with one (1) or more other plans, or if one (1) or more
          other plans satisfy the requirements of such Sections of the Code only
          if aggregated with this Plan, then the provisions of this Section 10.2
          shall be applied by determining the actual deferral percentage of
          eligible Participants as if all such plans were a single plan. Any
          adjustments to the Nonhighly-Compensated Employee actual deferral
          percentage for the prior year shall be made in accordance with Notice
          98-1 and any superseding guidance, unless the Employer has elected to
          use the current year testing method. Plans may be aggregated in order
          to satisfy Section 401(k) of the Code only if they have the same Plan
          Year and use the same average actual deferral percentage testing
          method.

          For purposes of determining the actual deferral percentage of a
          Participant who is classified as a Highly-Compensated Employee as the
          result of being a five percent (5%) owner, or who is one of the ten
          (10) highest paid Highly-Compensated Employees, the deferred amount
          and the compensation of such Participant shall include the deferred
          amounts and compensation of his family members (as defined in Code
          Section 414(q)(6)(B)) participating in the Plan. Such family members
          shall be disregarded in determining the average actual deferral
          percentage for Participants who are Nonhighly-Compensated Employees.
          The application of the family aggregation rule set forth in this
          paragraph, however, shall not apply for Plan Years beginning on and
          after January 1, 1997.

          The determination and treatment of deferred amounts and the actual
          deferral percentage of any Participant shall be subject to the
          prescribed requirements of the Secretary of the Treasury.

          In the event the average actual deferral percentage test is not
          satisfied for a Plan Year, the Employer, in its discretion, may make a
          special "fail-safe" contribution for eligible Participants who are
          Nonhighly-Compensated Employees and who are employed on the last day
          of the Plan Year ("Eligible Nonhighly-Compensated Employee(s)"). The
          fail safe contribution shall be allocated first to the Eligible
          Nonhighly-Compensated Employee whose Compensation is the lowest of all
          Eligible Nonhighly-Compensated Employees in an amount that does not
          exceed the limitations on annual additions set forth under Article
          Eleven of the Plan; then to the Eligible Nonhighly-Compensated
          Employee with the second lowest Compensation of all Eligible
          Nonhighly-Compensated Employees in the same manner as set forth above,
          and continuing to be allocated to Eligible Nonhighly-Compensated
          Employees in the order of ascending Compensation until the average
          actual deferral percentage test is satisfied.


                                       27
<PAGE>   33

      (b) Distributions of Excess Contributions.

          (1) In General. If the average actual deferral percentage test of
              Section 10.2(a) is not satisfied for a Plan Year, then the "excess
              contributions", and income allocable thereto, shall be
              distributed, to the extent required under Treasury regulations, no
              later than the last day of the Plan Year following the Plan Year
              for which the excess contributions were made. However, if such
              excess contributions are distributed later than two and one-half
              (2 1/2) months following the last day of the Plan Year in which
              such excess contributions were made, a ten percent (10%) excise
              tax shall be imposed upon the Employer with respect to such excess
              contributions.

          (2) Excess Contributions. For purposes of this Section, "excess
              contributions" shall consist of the excess of the aggregate amount
              of deferred amounts made by or on behalf of the Highly-Compensated
              Employees for such Plan Year over the maximum amount of all such
              contributions permitted under the test under Section 10.2(a). In
              order to comply with Section 401(k)(8)(C) of the Code (as amended
              by the Small Business Job Protection Act of 1996), effective
              January 1, 1997, excess contributions shall be allocated to the
              Highly-Compensated Employees with the largest amounts of
              contributions taken into account in calculating the average actual
              deferral percentage test for the year in which the excess arose,
              beginning with the Highly-Compensated Employee with the largest
              amount of such contributions and continuing in descending order
              until all the excess contributions have been allocated.

          (3) Determination of Income. The income allocable to excess
              contributions allocated to each Participant shall be determined by
              multiplying the income allocable to the Participant's deferred
              amounts for the Plan Year by a fraction, the numerator of which is
              the excess contributions made on behalf of the Participant for the
              Plan Year, and the denominator of which is the sum of the
              Participant's Account balances attributable to the Participant's
              deferred amounts on the last day of the Plan Year.

          (4) Maximum Distributable Amount. The excess contributions to be
              distributed to a Participant shall be adjusted for income and, if
              there is a loss allocable to the excess contribution, shall in no
              event be less than the lesser of the Participant's Account under
              the Plan or the Participant's deferred amounts for the Plan Year.
              Excess contributions shall be distributed from that portion of the
              Participant's Account attributable to such deferred amounts to the
              extent allowable under Treasury regulations.


                                       28
<PAGE>   34

10.3  NONDISCRIMINATION TEST FOR EMPLOYER MATCHING CONTRIBUTIONS

      (a) Average Contribution Percentage Test. The provisions of this Section
          shall apply if Employer matching contributions are made in any Plan
          Year under Section 4.2(a) and such matching contributions are not used
          to satisfy the average actual deferral percentage test of Section 10.2
          or if Employee after-tax contributions are made to the Plan under
          Section 4.5.

          Effective for Plan Years beginning on or after January 1, 1997, as of
          the last day of each Plan Year, the average contribution percentage
          for Highly-Compensated Employees for the Plan Year shall satisfy
          either of the following tests:

          (1) The average contribution percentage for eligible Participants who
              are Highly-Compensated Employees for the Plan Year shall not
              exceed the average contribution percentage for eligible
              Participants who were Nonhighly-Compensated Employees for the
              prior Plan Year multiplied by 1.25; or

          (2) The average contribution percentage for eligible Participants who
              are Highly-Compensated Employees for the Plan Year shall not
              exceed the average contribution percentage for eligible
              Participants who were Nonhighly-Compensated Employees for the
              prior Plan Year multiplied by two (2), provided that the average
              contribution percentage for eligible Participants who are
              Highly-Compensated Employees for the Plan Year does not exceed the
              average contribution percentage for eligible Participants who were
              Nonhighly-Compensated Employees in the prior Plan Year by more
              than two (2) percentage points or such lesser amount as the
              Secretary of the Treasury shall prescribe to prevent the multiple
              use of this alternative limitation with respect to any
              Highly-Compensated Employee.

      Notwithstanding the foregoing, if elected by the Employer in a formal
      amendment to the Plan, the foregoing percentage tests shall be applied as
      though the references therein to "the prior Plan Year" read "such Plan
      Year;" provided, however, the change in testing methods complies with the
      requirements set forth in Notice 98-1 and any other superseding guidance.
      Such election was made under the Plan and the Empress Plan for the 1997,
      1998 and 1999 Plan Years.

      Effective for testing years beginning January 1, 1999, in the event the
      Plan changes from the current year testing method to the prior year
      testing method, then, for purposes of the first testing year for which the
      change is effective, the average contribution percentage for
      Nonhighly-Compensated Employees for the prior year shall be determined by
      taking into account only (a) after-tax contributions for those
      Nonhighly-Compensated Employees for the prior year, (b) matching
      contributions for those Nonhighly-Compensated Employees that were taken
      into account for purposes of the average contribution percentage test (and
      not the average actual deferral percentage test) under the current year
      testing method for the prior year, and (c) any qualified nonelective
      contributions that were allocated to the Accounts of those
      Nonhighly-Compensated Employees for the prior year but that were not used
      to satisfy the average contribution percentage test or the average actual
      deferral percentage test under the current year testing method for the
      prior year.

      In the event the Plan changes from the current year to the prior year
      testing method for the first time for either the 1997 or 1998 testing
      year, the average contribution percentage for Nonhighly-Compensated
      Employees used for that testing year shall be the same as the average
      contribution percentage for Nonhighly-Compensated Employees used for the
      prior testing year.

      For purposes of the above tests, the "average contribution percentage"
      shall mean the average (expressed as a percentage) of the contribution
      percentages of the "eligible Participants" in each group. The
      "contribution percentage" shall mean the ratio (expressed as a percentage)
      that the sum of Employer matching contributions and elective deferrals (to
      the extent such elective deferrals are not used to satisfy the average
      actual deferral percentage test of Section 10.2) under the Plan on behalf
      of the eligible Participant for the Plan Year bears to the eligible
      Participant's compensation (within the meaning of Section 1.414(s)-1(d)(2)
      of the Income Tax Regulations) for the Plan Year. Such average
      contribution percentage shall be determined without regard to matching
      contributions that are used either to correct excess contributions
      hereunder or because contributions to which they relate are excess
      deferrals under Section 10.1 or excess contributions under Section 10.2.
      "Eligible Participant" shall mean each Employee who is eligible to
      participate in the Plan under Section 3.1.


                                       29
<PAGE>   35

      For purposes of this Section 10.3, the contribution percentage for any
      eligible Participant who is a Highly-Compensated Employee for the Plan
      Year and who is eligible to have Employer matching contributions, elective
      deferrals and/or after-tax contributions allocated to his account under
      two (2) or more plans described in Section 401(a) of the Code or under
      arrangements described in Section 401(k) of the Code that are maintained
      by the Employer or any member of the Employer's related group (within the
      meaning of Section 2.5(b)), shall be determined as if all such
      contributions were made under a single plan.

      In the event that this Plan satisfies the requirements of Section 401(m),
      401(a)(4) or 410(b) of the Code only if aggregated with one (1) or more
      other plans, or if one (1) or more other plans satisfy the requirements of
      such Sections of the Code only if aggregated with this Plan, then the
      provisions of this Section 10.3 shall be applied by determining the
      contribution percentages of eligible Participants as if all such plans
      were a single plan. Any adjustments to the Nonhighly-Compensated Employee
      actual contribution percentage for the prior year shall be made in
      accordance with Notice 98-1 and any superseding guidance, unless the
      Employer has elected to use the current year testing method. Plans may be
      aggregated in order to satisfy Section 401(m) of the Code only if they
      have the same Plan Year and use the same average contribution percentage
      testing method.

      For purposes of determining the contribution percentage of an eligible
      Participant who is classified as a Highly-Compensated Employee as the
      result of being a five percent (5%) owner or who is one of the ten (10)
      highest paid Highly-Compensated Employees, the Employer matching
      contributions, elective deferrals (to the extent not used to satisfy the
      average actual deferral percentage test of Section 10.2) and compensation
      of such Participant shall include the Employer matching contributions,
      such elective deferrals and compensation of his family members (as defined
      in Code Section 414(q)(6)(B)) participating in the Plan. Such family
      members shall be disregarded in determining the average contribution
      percentage for eligible Participants who are Nonhighly-Compensated
      Employees. The application of the family aggregation rule set forth in
      this paragraph, however, shall not apply for Plan Years beginning on and
      after January 1, 1997.

      The determination and treatment of the contribution percentage of any
      Participant shall satisfy such other requirements as may be prescribed by
      the Secretary of the Treasury.


                                       30
<PAGE>   36

      (b) Distribution of Excess Employer Matching Contributions.

          (1) In General. If the nondiscrimination tests of Section 10.3(a) are
              not satisfied for a Plan Year, then the "excess aggregate
              contributions", and any income allocable thereto, shall be
              forfeited, if otherwise forfeitable, no later than the last day of
              the Plan Year following the Plan Year for which the
              nondiscrimination tests are not satisfied, and shall be used to
              reduce Employer contributions under Section 4.2(a). To the extent
              that such "excess aggregate contributions" are nonforfeitable,
              such excess contributions shall be distributed to the Participant
              on whose behalf the excess contributions were made no later than
              the last day of the Plan Year following the Plan Year for which
              such "excess aggregate contributions" were made. However, if such
              excess aggregate contributions are distributed later than two and
              one-half (2 1/2) months following the last day of the Plan Year in
              which such excess aggregate contributions were made, a ten percent
              (10%) excise tax shall be imposed upon the Employer with respect
              to such excess aggregate contributions. For purposes of the
              limitations of Section 11.1(b)(1) of the Plan, excess aggregate
              contributions shall be considered annual additions.

          (2) Excess Aggregate Contributions. For purposes of this Section,
              "excess aggregate contributions" shall consist of the excess of
              the aggregate amount of Employer matching contributions and, if
              applicable, Employee after-tax contributions, and elective
              deferrals (to the extent not used to satisfy the average actual
              deferral percentage test of Section 10.2) made on behalf of the
              Highly-Compensated Employees for such Plan Year over the maximum
              amount of all such contributions permitted under the
              nondiscrimination tests under Section 10.3(a). In order to comply
              with Section 401(m)(6)(C) of the Code (as amended by the Small
              Business Job Protection Act of 1996), effective January 1, 1997,
              excess contributions shall be allocated to the Highly-Compensated
              Employee with the largest "contribution percentage amounts" (as
              defined below) taken into account in calculating the average
              contribution percentage test for the year in which the excess
              arose, beginning with the Highly-Compensated Employee with the
              largest contribution percentage amounts and continuing in
              descending order until all the excess aggregate contributions have
              been allocated.

              For purposes of the preceding paragraph, "contribution percentage
              amounts" shall mean the sum of Employer matching contributions and
              elective deferrals (to the extent not used to satisfy the average
              actual deferral percentage test of Section 10.2) made under the
              Plan on behalf of the Participant for the Plan Year.

          (3) Determination of Income. The income allocable to excess
              contributions allocated to each Participant shall be determined by
              multiplying the income allocable to the Employer matching
              contributions and such elective deferrals by a fraction, the
              numerator of which is the excess aggregate contributions on behalf
              of the Participant for the Plan Year, and the denominator of which
              is the sum of the Participant's Account balances attributable to
              Employer matching contributions on the last day of the Plan Year.

      Notwithstanding the foregoing, to the extent otherwise required to comply
      with the requirements of Section 401(a)(4) of the Code and the regulations
      thereunder, vested matching contributions may be forfeited.

10.4  LIMITATION ON THE MULTIPLE USE ALTERNATIVE. The sum of the average actual
      deferral percentage of Highly-Compensated Employees under Section 10.2(a)
      and the average contribution percentage of Highly-Compensated Employees
      under Section 10.3(a) shall not exceed the "aggregate limit," as defined
      in Section 401(m)(9) of the Code and the regulations promulgated
      thereunder.

      If the aggregate limit is exceeded, the average contribution percentage of
      the Highly-Compensated Employees shall be reduced in accordance with the
      provisions of Section 10.3(b). In lieu of reducing the average
      contribution percentage, the Administrator may reduce the average actual
      deferral percentage of the Highly-Compensated Employees in accordance with
      the provisions of Section 10.2(b). The reductions under this Section shall
      be made only to the extent necessary to comply with the restrictions on
      the multiple use of the "alternative limitation" within the meaning of
      Code Section 401(m)(9).



                                       31
<PAGE>   37
                 ARTICLE ELEVEN--LIMITATION ON ANNUAL ADDITIONS

11.1  RULES AND DEFINITIONS

      (a) Rules. The following rules shall limit additions to Participants'
          Accounts:

          (1) If the Participant does not participate, and has never
              participated, in another qualified plan maintained by the
              Employer, the amount of annual additions which may be credited to
              the Participant's Account for any limitation year shall not exceed
              the lesser of the "maximum permissible" amount (as hereafter
              defined) or any other limitation contained in this Plan. If the
              Employer contribution that would otherwise be allocated to the
              Participant's Account would cause the annual additions for the
              limitation year to exceed the maximum permissible amount, the
              amount allocated shall be reduced so that the annual additions for
              the limitation year shall equal the maximum permissible amount.

          (2) Prior to determining the Participant's actual compensation for the
              limitation year, the Employer may determine the maximum
              permissible amount for a Participant on the basis of a reasonable
              estimation of the Participant's compensation for the limitation
              year, uniformly determined for all Participants similarly
              situated.

          (3) As soon as is administratively feasible after the end of the
              limitation year, the maximum permissible amount for the limitation
              year shall be determined on the basis of the Participant's actual
              compensation for the limitation year.

          (4) If, as a result of the allocation of forfeitures, a reasonable
              error in estimating a Participant's annual Compensation, a
              reasonable error in determining elective deferrals, the
              limitations of Section 415 of the Code are exceeded, such excess
              amount shall be disposed of as follows:

              (A) Any nondeductible Employee after-tax contributions (plus
                  attributable earnings) and, to the extent elected by the
                  Administrator pursuant to a nondiscriminatory procedure,
                  elective deferrals under Section 4.1(a) (plus attributable
                  earnings), to the extent they would reduce the excess amount,
                  shall be returned to the Participant.

              (B) If an excess amount still exists after the application of
                  subparagraph (A), and the Participant is covered by the Plan
                  at the end of the limitation year, the excess amount in the
                  Participant's Account shall be used to reduce Employer
                  contributions (including any allocation of forfeitures, if
                  applicable) for such Participant in the next limitation year,
                  and each succeeding limitation year if necessary;

              (C) If an excess amount still exists after the application of
                  subparagraph (A), and the Participant is not covered by the
                  Plan at the end of the limitation year, the excess amount
                  shall be held unallocated in a suspense account and applied to
                  reduce future Employer contributions (including allocation of
                  any forfeitures) for all remaining Participants in the next
                  limitation year, and each succeeding limitation year if
                  necessary. Excess amounts may not be distributed to
                  Participants or former Participants.

              (D) If a suspense account is in existence at any time during the
                  limitation year pursuant to this Section 11.1(a)(4), it shall
                  not participate in the allocation of the Trust's investment
                  gains and losses. In addition, all amounts held in the
                  suspense account shall be allocated and reallocated to
                  Participants' Accounts before any Employer or Employee
                  contributions may be made for the limitation year.


                                       32
<PAGE>   38

          (5) If, in addition to this Plan, the Participant is covered under
              another defined contribution plan maintained by the Employer, or a
              welfare benefit fund, as defined in Code Section 419(e),
              maintained by the Employer, or an individual medical account, as
              defined in Code Section 415(1)(2), maintained by the Employer
              which provides an annual addition, the annual additions which may
              be credited to a Participant's account under all such plans for
              any such limitation year shall not exceed the maximum permissible
              amount. Benefits shall be reduced under any discretionary defined
              contribution plan before they are reduced under any defined
              contribution pension plan. If both plans are discretionary
              contribution plans, they shall first be reduced under this Plan.
              Any excess amount attributable to this Plan shall be disposed of
              in the manner described in Section 11.1(a)(4).

          (6) If the Employer maintains, or at any time maintained, a qualified
              defined benefit plan covering any Participant in this Plan, the
              sum of the Participant's defined benefit plan fraction and defined
              contribution plan fraction shall not exceed 1.0 in any limitation
              year. The annual additions which may be credited to the
              Participant's Account under this Plan for any limitation year
              shall be limited so that if the limitations of Code Section 415(e)
              become applicable, benefits under a defined contribution plan
              shall have first been provided before benefits under a defined
              benefit plan are provided.

              The combined limitation set forth in the preceding paragraph shall
              not apply to any limitation year beginning after December 31,
              1999.

          (7) In any Plan Year in which the Plan becomes a Super Top-Heavy Plan
              (as defined in Section 13.2(b)), the denominators of the defined
              benefit fraction and defined contribution fraction shall be
              computed using one hundred percent (100%) of the maximum dollar
              limitation instead of one hundred and twenty-five percent (125%).

          (8) In any year in which the Plan is a Top-Heavy Plan (as defined in
              Section 13.2(c)) (but not a Super Top-Heavy Plan), the limitations
              shall be similarly reduced, subject to the special provisions of
              Section 13.3, which provide for the use of the one hundred and
              twenty-five percent (125%) limitation subject to the added minimum
              allocations.




                                       33
<PAGE>   39

      (b) Definitions.

          (1) Annual additions: The following amounts credited to a
              Participant's Account for the limitation year shall be treated as
              annual additions:

              (A) Employer contributions;

              (B) Elective deferrals;

              (C) Employee after-tax contributions, if any;

              (D) Forfeitures, if any; and

              (E) Amounts allocated after March 31, 1984 to an individual
                  medical account, as defined in Section 415(l)(2) of the Code,
                  which is part of a pension or annuity plan maintained by the
                  Employer. Also, amounts derived from contributions paid or
                  accrued after December 31, 1985 in taxable years ending after
                  such date which are attributable to post-retirement medical
                  benefits allocated to the separate account of a Key Employee,
                  as defined in Section 419A(d)(3), and amounts under a welfare
                  benefit fund, as defined in Section 419(e), maintained by the
                  Employer, shall be treated as annual additions to a defined
                  contribution plan.

              Employer and employee contributions taken into account as annual
              additions shall include "excess contributions" as defined in
              Section 401(k)(8)(B) of the Code, "excess aggregate contributions"
              as defined in Section 401(m)(6)(B) of the Code, and "excess
              deferrals" as defined in Section 402(g) of the Code, regardless of
              whether such amounts are distributed, recharacterized or
              forfeited, unless such amounts constitute excess deferrals that
              were distributed to the Participant no later than April 15 of the
              taxable year following the taxable year of the Participant in
              which such deferrals were made.

              For this purpose, any excess amount applied under Section
              11.1(a)(4) in the limitation year to reduce Employer contributions
              shall be considered annual additions for such limitation year.

          (2) Compensation: For purposes of determining maximum permitted
              benefits under this Section, compensation shall include all of a
              Participant's earned income, wages, salaries, and fees for
              professional services, and other amounts received for personal
              services actually rendered in the course of employment with the
              Employer, including, but not limited to, commissions paid to
              salesmen, compensation for services on the basis of a percentage
              of profits, commissions on insurance premiums, tips and bonuses,
              and effective for limitation years beginning after December 31,
              1997, including also any elective deferrals (as defined in Section
              402(g)(3) of the Code) made by an Employee to the Plan and any
              amount contributed or deferred by an Employee on an elective basis
              and not includable in the gross income of the Employee under
              Section 125 of the Code; and excluding the following:

              (A) Except as provided in the preceding paragraph of this Section
                  11.1(b)(2), Employer contributions to a plan of deferred
                  compensation which are not included in the Employee's gross
                  income for the taxable year in which contributed, or Employer
                  contributions under a simplified employee pension plan (funded
                  with individual retirement accounts or annuities) to the
                  extent such contributions are deductible by the Employee, or
                  any distributions from a plan of deferred compensation;


                                       34
<PAGE>   40

              (B) Amounts realized from the exercise of a nonqualified stock
                  option, or when restricted stock (or property) held by the
                  Employee either becomes freely transferable or is no longer
                  subject to a substantial risk of forfeiture;

              (C) Amounts realized from the sale, exchange, or other disposition
                  of stock acquired under a qualified stock option; and

              (D) Other amounts which received special tax benefits, or
                  contributions made by the Employer (whether or not under a
                  salary reduction agreement) toward the purchase of an annuity
                  described in Section 403(b) of the Code (whether or not the
                  amounts are actually excludable from the gross income of the
                  Employee).

              Compensation shall be measured on the basis of compensation paid
              in the limitation year.

          (3) Defined benefit fraction: This shall mean a fraction, the
              numerator of which is the sum of the Participant's projected
              annual benefits under all the defined benefit plans maintained or
              previously maintained by the Employer, and the denominator of
              which is the lesser of one hundred and twenty-five percent (125%)
              of the dollar limitation in effect for the limitation year under
              Section 415(b)(1)(A) of the Code or one hundred and forty percent
              (140%) of the highest average compensation including any
              adjustment under Code Section 415(b).

          (4) Defined contribution fraction: This shall mean a fraction, the
              numerator of which is the sum of the annual additions to the
              Participant's account under all the defined contribution plans
              (whether or not terminated), welfare benefit funds, and individual
              medical accounts maintained by the Employer for the current and
              all prior limitation years, and the denominator of which is the
              sum of the maximum aggregate amounts for the current and all prior
              limitation years of Service with the Employer, regardless of
              whether a defined contribution plan was maintained by the
              Employer.

              The maximum aggregate amount in any limitation year is the lesser
              of one hundred and twenty-five percent (125%) of the dollar
              limitation then in effect under Section 415(c)(1)(A) of the Code
              or thirty-five (35%) of the Participant's compensation for such
              year.

              If the Employee, as of the end of the first day of the first
              limitation year beginning after December 31, 1986, was a
              participant in one (1) or more defined contribution plans
              maintained by the Employer which were in existence on May 5, 1986,
              the numerator of this fraction shall be adjusted if the sum of
              this fraction and the defined benefit fraction would otherwise
              exceed 1.0 under the terms of this Plan. Under the adjustment, an
              amount equal to the product of (i) the excess of the sum of the
              fractions over 1.0 and (ii) the denominator of this fraction, will
              be permanently subtracted from the numerator of this fraction. The
              adjustment is calculated using the fractions as they would be
              computed as of the end of the last limitation year beginning
              before January 1, 1987, and disregarding any changes in the terms
              and conditions of the Plan made after May 5, 1986, but using the
              Code Section 415 limitation applicable to the first limitation
              year beginning on or after January 1, 1987.


                                       35
<PAGE>   41

              The annual addition for any limitation year beginning before
              January 1, 1987, shall not be recomputed to treat all Employee
              contributions as annual additions.

          (5) Defined contribution dollar limitation: Effective January 1, 1995,
              this shall mean $30,000, as adjusted under Section 415(d) of the
              Code.

          (6) Employer: This term refers to the Employer that adopts this Plan,
              and all members of a controlled group of corporations (as defined
              in Section 414(b) of the Code, as modified by Section 415(h)),
              commonly-controlled trades or businesses (as defined in Section
              414(c), as modified by Section 415(h)), or affiliated service
              groups (as defined in Section 414(m)) of which the Employer is a
              part, or any other entity required to be aggregated with the
              Employer under Code Section 414(o).

          (7) Highest average compensation: This means the average compensation
              for the three (3) consecutive limitation years with the Employer
              that produces the highest average.

          (8) Limitation year: This shall mean the Plan Year, unless the
              Employer elects a different twelve (12) consecutive month period.
              The election shall be made by the adoption of a Plan amendment by
              the Employer. If the limitation year is amended to a different
              twelve (12) consecutive month period, the new limitation year must
              begin on a date within the limitation year in which the amendment
              is made.

          (9) Maximum permissible amount: This shall mean an amount equal to the
              lesser of the defined contribution dollar limitation or
              twenty-five percent (25%) of the Participant's compensation for
              the limitation year. If a short limitation year is created because
              of an amendment changing the limitation year to a different twelve
              (12)-consecutive month period, the maximum permissible amount
              shall not exceed the defined contribution dollar limitation
              multiplied by the following fraction:

                  Number of months in the short limitation year
                  ---------------------------------------------
                                       12

         (10) Projected annual benefit: This is the annual retirement benefit
              (adjusted to an actuarially equivalent straight life annuity if
              such benefit is expressed in a form other than a straight life
              annuity or qualified joint and survivor annuity) to which the
              Participant would be entitled under the terms of the plan,
              assuming:

              (A) the Participant will continue employment until normal
                  retirement age under the plan (or current age, if later), and

              (B) the Participant's compensation for the current limitation year
                  and all other relevant factors used to determine benefits
                  under the plan will remain constant for all future limitation
                  years.



                                       36
<PAGE>   42

                    ARTICLE TWELVE--AMENDMENT AND TERMINATION

12.1  AMENDMENT. The Company, by resolution of its board of directors, (or, to
      the extent permitted by resolution of such board of directors, by action
      of a duly authorized officer of the Company) shall have the right to
      amend, alter or modify the Plan at any time, or from time to time, in
      whole or in part. Any such amendment shall become effective under its
      terms upon adoption by the Company. However, no amendment affecting the
      duties, powers or responsibilities of the Trustee may be made without the
      written consent of the Trustee. No amendment shall be made to the Plan
      which shall:

      (a) make it possible (other than as provided in Section 14.3) for any part
          of the corpus or income of the Trust Fund (other than such part as may
          be required to pay taxes and administrative expenses) to be used for
          or diverted to purposes other than the exclusive benefit of the
          Participants or their Beneficiaries;

      (b) decrease a Participant's account balance or eliminate an optional form
          of payment with respect to benefits accrued as of the later of (i) the
          date such amendment is adopted, or (ii) the date the amendment becomes
          effective; or

      (c) alter the schedule for vesting in a Participant's Account with respect
          to any Participant with three (3) or more Years of Service without his
          consent or deprive any Participant of any nonforfeitable portion of
          his Account.

      Notwithstanding the other provisions of this Section or any other
      provisions of the Plan, any amendment or modification of the Plan may be
      made retroactively if necessary or appropriate to conform to or to satisfy
      the conditions of any law, governmental regulation, or ruling, and to meet
      the requirements of the Employee Retirement Income Security Act of 1974,
      as it may be amended.

12.2  TERMINATION OF THE PLAN. The Company, by resolution of its board of
      directors, reserves the right at any time and in its sole discretion to
      discontinue payments under the Plan and to terminate the Plan. In the
      event the Plan is terminated, or upon complete discontinuance of
      contributions under the Plan by the Company, the rights of each
      Participant to his Account on the date of such termination or
      discontinuance of contributions, to the extent of the fair market value
      under the Trust Fund, shall become fully vested and nonforfeitable. The
      Company shall direct the Trustee to distribute the Trust Fund in
      accordance with the Plan's distribution provisions to the Participants and
      their Beneficiaries, each Participant or Beneficiary receiving a portion
      of the Trust Fund equal to the value of his Account as of the date of
      distribution. These distributions may be implemented by the continuance of
      the Trust and the distribution of the Participants' Account shall be made
      at such time and in such manner as though the Plan had not terminated, or
      by any other appropriate method, including rollover into Individual
      Retirement Accounts. Upon distribution of the Trust Fund, the Trustee
      shall be discharged from all obligations under the Trust and no
      Participant or Beneficiary shall have any further right or claim therein.
      In the event of the partial termination of the Plan, the Accounts of all
      affected Participants shall become fully vested and nonforfeitable and the
      provisions of the preceding paragraph shall apply with respect to such
      Participants' Accounts.


                                       37
<PAGE>   43

12.3  DISTRIBUTION UPON SALE OR DISPOSITION OF STOCK OR ASSETS. The vested
      balances of affected Participants (as defined below) may be distributed,
      in a single lump-sum payment, as soon as administratively practical
      following:

      (i)  the sale or other disposition of the Employer's interest in a
           subsidiary (within the meaning of Section 409(d)(3) of the Code) to
           an entity that is not a "related group member" (within the meaning of
           Section 2.5(b)), provided that the Employer and not the acquirer
           continues to maintain the Plan after the disposition. In this case,
           affected Participants shall be those Participants who continue
           employment with such subsidiary.

      (ii) the sale or other disposition of "substantially all" (within the
           meaning of Section 1.401(k)-1(d)(4) of the Income Tax Regulations) of
           the assets used by the Employer in a trade or business to an
           unrelated corporation, provided that the Employer and not the
           acquirer continues to maintain the Plan after the disposition. In
           this case, affected Participants shall be those Participants who
           continue employment with the corporation acquiring such assets.



                                       38
<PAGE>   44

                     ARTICLE THIRTEEN--TOP-HEAVY PROVISIONS

13.1  APPLICABILITY. The provisions of this Article shall become applicable only
      for any Plan Year in which the Plan is a Top-Heavy Plan (as defined in
      Section 13.2(c)). The determination of whether the Plan is a Top-Heavy
      Plan shall be made each Plan Year by the Administrator.

13.2  DEFINITIONS. For purposes of this Article, the following definitions shall
      apply:

      (a) "KEY EMPLOYEE": "Key Employee" shall mean any Employee or former
          Employee (and the Beneficiaries of such Employee) who, at any time
          during the determination period, was (1) an officer of the Employer
          earning compensation (as defined in Section 416(i) of the Code) in
          excess of fifty percent (50%) of the dollar limitation under Section
          415(b)(1)(A) of the Code, (2) an owner (or considered an owner under
          Section 318 of the Code) of both more than a one-half percent (1/2%)
          interest in the Employer and one of the ten (10) largest interests in
          the Employer if such individual's compensation exceeds the dollar
          limitation under Section 415(c)(1)(A) of the Code, (3) a five percent
          (5%) owner of the Employer, or (4) a one percent (1%) owner of the
          Employer who has an annual compensation of more than $150,000. For
          purposes of this Section, annual compensation shall mean compensation
          as defined in Code Section 415(c)(3), but including amounts
          contributed by the Employer pursuant to a salary reduction agreement
          which are excludable from the Employee's income under Code Sections
          125, 402(g), 402(h) or 403(b). The determination period of the Plan is
          the Plan Year containing the "determination date" as defined in
          Section 13.2(c)(4) and the four (4) preceding Plan Years.

          The determination of who is a Key Employee (including the terms "5%
          owner" and "1% owner") shall be made in accordance with Section
          416(i)(1) of the Code and the regulations thereunder.

      (b) "SUPER TOP-HEAVY PLAN": The Plan shall constitute a "Super Top-Heavy
          Plan" if it meets the test for status as a Top-Heavy Plan, where "90%"
          is substituted for "60%" at each place in Section 13.2(c).

      (c) "TOP-HEAVY PLAN":

          (1) The Plan shall constitute a "Top-Heavy Plan" if any of the
              following conditions exist:

              (A) The top-heavy ratio for the Plan exceeds sixty percent (60%)
                  and the Plan is not part of any required aggregation group or
                  permissive aggregation group of plans; or

              (B) The Plan is part of a required aggregation group of plans (but
                  is not part of a permissive aggregation group) and the
                  top-heavy ratio for the group of plans exceeds sixty percent
                  (60%); or

              (C) The Plan is a part of a required aggregation group of plans
                  and part of a permissive aggregation group and the top-heavy
                  ratio for the permissive aggregation group exceeds sixty
                  percent (60%).


                                       39
<PAGE>   45

          (2) If the Employer maintains one (1) or more defined contribution
              plans (including any simplified employee pension plan funded with
              individual retirement accounts or annuities) and the Employer
              maintains or has maintained one (1) or more defined benefit plans
              which have covered or could cover a Participant in this Plan, the
              top-heavy ratio is a fraction, the numerator of which is the sum
              of account balances under the defined contribution plans for all
              Key Employees and the actuarial equivalents of accrued benefits
              under the defined benefit plans for all Key Employees, and the
              denominator of which is the sum of the account balances under the
              defined contribution plans for all Participants and the actuarial
              equivalents of accrued benefits under the defined benefit plans
              for all Participants. Both the numerator and denominator of the
              top-heavy ratio shall include any distribution of an account
              balance or an accrued benefit made in the five (5)-year period
              ending on the determination date and any contribution due to a
              defined contribution pension plan but unpaid as of the
              determination date. In determining the accrued benefit of a
              non-Key Employee who is participating in a plan that is part of a
              required aggregation group, the method of determining such benefit
              shall be either (i) in accordance with the method, if any, that
              uniformly applies for accrual purposes under all plans maintained
              by the Employer or any member of the Employer's related group
              (within the meaning of Section 2.5(b)), or (ii) if there is no
              such method, as if such benefit accrued not more rapidly than the
              slowest accrual rate permitted under the fractional accrual rate
              of Code Section 411(b)(1)(C).

          (3) For purposes of (1) and (2) above, the value of account balances
              and the actuarial equivalents of accrued benefits shall be
              determined as of the most recent Valuation Date that falls within
              or ends with the twelve (12)-month period ending on the
              determination date. The account balances and accrued benefits of a
              Participant who is not a Key Employee but who was a Key Employee
              in a prior year shall be disregarded. The accrued benefits and
              account balances of Participants who have performed no Hours of
              Service with any Employer maintaining the plan for the five
              (5)-year period ending on the determination date shall be
              disregarded. The calculations of the top-heavy ratio, and the
              extent to which distributions, rollovers, and transfers are taken
              into account shall be made under Section 416 of the Code and
              regulations issued thereunder. Deductible Employee contributions
              shall not be taken into account for purposes of computing the
              top-heavy ratio. When aggregating plans, the value of account
              balances and accrued benefits shall be calculated with reference
              to the determination dates that fall within the same calendar
              year.


                                       40
<PAGE>   46

          (4) Definition of terms for Top-Heavy status:

              (A) "TOP-HEAVY RATIO" shall mean the following:

                  (1) If the Employer maintains one or more defined contribution
                      plans (including any simplified employee pension plan
                      funded with individual retirement accounts or annuities)
                      and the Employer has never maintained any defined benefit
                      plans which have covered or could cover a Participant in
                      this Plan, the top-heavy ratio is a fraction, the
                      numerator of which is the sum of the account balances of
                      all Key Employees as of the determination date (including
                      any part of any account balance distributed in the five
                      (5)-year period ending on the determination date), and the
                      denominator of which is the sum of the account balances
                      (including any part of any account balance distributed in
                      the five (5)-year period ending on the determination date)
                      of all Participants as of the determination date. Both the
                      numerator and the denominator shall be increased by any
                      contributions due but unpaid to a defined contribution
                      pension plan as of the determination date.

                  (B) "PERMISSIVE AGGREGATION GROUP" shall mean the required
                      aggregation group of plans plus any other plan or plans of
                      the Employer which, when considered as a group with the
                      required aggregation group, would continue to satisfy the
                      requirements of Sections 401(a)(4) and 410 of the Code.

                  (C) "REQUIRED AGGREGATION GROUP" shall mean (i) each qualified
                      plan of the Employer (including any terminated plan) in
                      which at least one Key Employee participates, and (ii) any
                      other qualified plan of the Employer which enables a plan
                      described in (i) to meet the requirements of Section
                      401(a)(4) or 410 of the Code.

                  (D) "DETERMINATION DATE" shall mean, for any Plan Year
                      subsequent to the first Plan Year, the last day of the
                      preceding Plan Year. For the first Plan Year of the Plan,
                      "determination date" shall mean the last day of that Plan
                      Year.

                  (E) "VALUATION DATE" shall mean the last day of the Plan Year.

                  (F) Actuarial equivalence shall be based on the interest and
                      mortality rates utilized to determine actuarial
                      equivalence when benefits are paid from any defined
                      benefit plan. If no rates are specified in said plan, the
                      following shall be utilized: pre- and post-retirement
                      interest -- five percent (5%); post-retirement mortality
                      based on the Unisex Pension (1984) Table as used by the
                      Pension Benefit Guaranty Corporation on the date of
                      execution hereof.




                                       41
<PAGE>   47

13.3  ALLOCATION OF EMPLOYER CONTRIBUTIONS AND FORFEITURES FOR A TOP-HEAVY PLAN
      YEAR.

      (a) Except as otherwise provided below, in any Plan Year in which the Plan
          is a Top-Heavy Plan, the Employer contributions and forfeitures
          allocated on behalf of any Participant who is a non-Key Employee shall
          not be less than the lesser of three percent (3%) of such
          Participant's compensation (as defined in Section 11.1(b)(2) and as
          limited by Section 401(a)(17) of the Code) or the largest percentage
          of Employer contributions, elective deferrals, and forfeitures as a
          percentage of the Key Employee's compensation (as defined in Section
          11.1(b)(2) and as limited by Section 401(a)(17) of the Code),
          allocated on behalf of any Key Employee for that Plan Year. This
          minimum allocation shall be made even though, under other Plan
          provisions, the Participant would not otherwise be entitled to receive
          an allocation or would have received a lesser allocation for the Plan
          Year because of insufficient Employer contributions under Section 4.2,
          the Participant's failure to complete one thousand (1,000) Hours of
          Service or the Participant's failure to make elective deferrals under
          Section 4.1.

      (b) The minimum allocation under this Section shall not apply to any
          Participant who was not employed by the Employer on the last day of
          the Plan Year.

      (c) Neither elective deferrals nor Employer matching contributions may be
          taken into account for the purpose of satisfying the minimum
          allocation.

      (d) For purposes of the Plan, a non-Key Employee shall be any Employee or
          Beneficiary of such Employee, any former Employee, or Beneficiary of
          such former Employee, who is not or was not a Key Employee during the
          Plan Year ending on the determination date, nor during the four (4)
          preceding Plan Years.

      (e) If no defined benefit plan has ever been part of a permissive or
          required aggregation group of plans of the Employer, the contributions
          and forfeitures under this step shall be offset by any allocation of
          contributions and forfeitures under any other defined contribution
          plan of the Employer with a Plan Year ending in the same calendar year
          as this Plan's Valuation Date.

      (f) There shall be no duplication of the minimum benefits required under
          Code Section 416. Benefits shall be provided under defined
          contribution plans before under defined benefit plans. If a defined
          benefit plan (active or terminated) is part of the permissive or
          required aggregation group of plans, the allocation method of
          subparagraph (a) above shall apply, except that "3%" shall be
          increased to "5%".

      (g) There shall be no duplication of the minimum benefits required under
          Code Section 416. Benefits shall be provided under defined
          contribution plans before defined benefit plans. If a defined benefit
          plan (active or terminated) is part of the permissive or required
          aggregation group of plans, and if any Participant in the Plan would
          have his benefits limited due to the application of the Code
          limitation rule in Section 11.1 in a Plan Year in which the Plan is a
          Top-Heavy Plan but not a Super Top-Heavy Plan, the allocation method
          of subparagraph (f) above shall apply, except that "5%" shall be
          increased to "7.5%." In the event any Participant in the Plan would
          have his benefits limited due to the application of the special Code
          limitation rule in Section 11.1 in a Plan Year in which the Plan is a
          Top-Heavy Plan but not a Super Top-Heavy Plan and the Participant is
          covered only by a defined contribution plan, the allocation method of
          subparagraph (a) shall apply, except that "3%" shall be increased to
          "4%".

13.4  VESTING. The provisions contained in Section 6.1 relating to vesting shall
      continue to apply in any Plan Year in which the Plan is a Top-Heavy Plan,
      and apply to all benefits within the meaning of Section 411(a)(7) of the
      Code except those attributable to Employee contributions and elective
      deferrals under Section 4.1, including benefits accrued before the
      effective date of Section 416 and benefits accrued before the Plan became
      a Top-Heavy Plan. Further, no reduction in vested benefits may occur in
      the event the Plan's status as a Top-Heavy Plan changes for any Plan Year
      and the vesting schedule is amended. In addition, if a Plan's status
      changes from a Top-Heavy Plan to that of a non-Top-Heavy Plan, a
      Participant with three (3) Years of Service shall continue to have his
      vested rights determined under the schedule which he selects, in the event
      the vesting schedule is subsequently amended.

      Payment of a Participant's vested Account balance under this Section shall
      be made in accordance with the provisions of Article Seven.


                                       42
<PAGE>   48

                   ARTICLE FOURTEEN--MISCELLANEOUS PROVISIONS

14.1  PLAN DOES NOT AFFECT EMPLOYMENT. Neither the creation of this Plan, any
      amendment thereto, the creation of any fund nor the payment of benefits
      hereunder shall be construed as giving any legal or equitable right to any
      Employee or Participant against the Employer, its officers or Employees,
      or against the Trustee. All liabilities under this Plan shall be
      satisfied, if at all, only out of the Trust Fund held by the Trustee.
      Participation in the Plan shall not give any Participant any right to be
      retained in the employ of the Employer, and the Employer hereby expressly
      retains the right to hire and discharge any Employee at any time with or
      without cause, as if the Plan had not been adopted, and any such
      discharged Participant shall have only such rights or interests in the
      Trust Fund as may be specified herein.

14.2  SUCCESSOR TO THE EMPLOYER. In the event of the merger, consolidation,
      reorganization or sale of assets of the Employer, under circumstances in
      which a successor person, firm, or corporation shall carry on all or a
      substantial part of the business of the Employer, and such successor shall
      employ a substantial number of Employees of the Employer and shall elect
      to carry on the provisions of the Plan, such successor shall be
      substituted for the Employer under the terms and provisions of the Plan
      upon the filing in writing with the Trustee of its election to do so.

14.3  REPAYMENTS TO THE EMPLOYER. Notwithstanding any provisions of this Plan to
      the contrary:

      (a) Any monies or other Plan assets attributable to any contribution made
          to this Plan by the Employer because of a mistake of fact shall be
          returned to the Employer within one (1) year after the date of
          contribution.

      (b) Any monies or other Plan assets attributable to any contribution made
          to this Plan by the Employer shall be refunded to the Employer, to the
          extent such contribution is predicated on the deductibility thereof
          under the Code and the income tax deduction for such contribution is
          disallowed. Such amount shall be refunded within one (1) taxable year
          after the date of such disallowance or within one (1) year of the
          resolution of any judicial or administrative process with respect to
          the disallowance. All Employer contributions hereunder are expressly
          contributed based upon such contributions' deductibility under the
          Code.

14.4  BENEFITS NOT ASSIGNABLE. Except as provided in Section 414(p) of the Code
      with respect to "qualified domestic relations orders," the rights of any
      Participant or his Beneficiary to any benefit or payment hereunder shall
      not be subject to voluntary or involuntary alienation or assignment.

      With respect to any "qualified domestic relations order" relating to the
      Plan, the Plan shall permit distribution to an alternate payee under such
      order at any time, irrespective of whether the Participant has attained
      his "earliest retirement age" (within the meaning of Section 414(p)(4)(B)
      of the Code) under the Plan. A distribution to an alternate payee prior to
      the Participant's attainment of his earliest retirement age shall,
      however, be available only if the order specifies distribution at that
      time or permits an agreement between the Plan and the alternate payee to
      authorize an earlier distribution. Nothing in this paragraph shall,
      however, give a Participant a right to receive distribution at a time
      otherwise not permitted under the Plan nor does it permit the alternate
      payee to receive a form of payment not otherwise permitted under the Plan
      or under said Section 414(p) of the Code.



                                       43
<PAGE>   49

14.5  MERGER OF PLANS. In the case of any merger or consolidation of this Plan
      with, or transfer of the assets or liabilities of the Plan to, any other
      plan, the terms of such merger, consolidation or transfer shall be such
      that each Participant would receive (in the event of termination of this
      Plan or its successor immediately thereafter) a benefit which is no less
      than what the Participant would have received in the event of termination
      of this Plan immediately before such merger, consolidation or transfer.

14.6  INVESTMENT EXPERIENCE NOT A FORFEITURE. The decrease in value of any
      Account due to adverse investment experience shall not be considered an
      impermissible "forfeiture" of any vested balance.

14.7  CONSTRUCTION. Wherever appropriate, the use of the masculine gender shall
      be extended to include the feminine and/or neuter or vice versa; and the
      singular form of words shall be extended to include the plural; and the
      plural shall be restricted to mean the singular.

14.8  GOVERNING DOCUMENTS. A Participant's rights shall be determined under the
      terms of the Plan as in effect at the Participant's date of separation
      from Service.

14.9  GOVERNING LAW. The provisions of this Plan shall be construed under the
      laws of the state of the situs of the Trust, except to the extent such
      laws are preempted by Federal law.

14.10 HEADINGS. The Article headings and Section numbers are included solely for
      ease of reference. If there is any conflict between such headings or
      numbers and the text of the Plan, the text shall control.

14.11 COUNTERPARTS. This Plan may be executed in any number of counterparts,
      each of which shall be deemed an original; said counterparts shall
      constitute but one and the same instrument, which may be sufficiently
      evidenced by any one counterpart.

14.12 LOCATION OF PARTICIPANT OR BENEFICIARY UNKNOWN. In the event that all or
      any portion of the distribution payable to a Participant or to a
      Participant's Beneficiary hereunder shall, at the expiration of five (5)
      years after it shall become payable, remain unpaid solely by reason of the
      inability of the Administrator to ascertain the whereabouts of such
      Participant or Beneficiary, after sending a registered letter, return
      receipt requested, to the last known address, and after further diligent
      effort, the amount so distributable shall be used to pay Plan expenses
      and/or handled in the same manner as a forfeiture under Section 6.2
      pursuant to this Plan. In the event a Participant or Beneficiary is
      located subsequent to the forfeiture of his Account balance, such Account
      balance shall be restored.


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


                                       44
<PAGE>   50


IN WITNESS WHEREOF, the Employer, by its duly authorized officer, has caused
this Plan to be executed on the ________________ day of _________________, 2000.


                                              HORSESHOE GAMING HOLDING CORP.


                                              By
                                                  ------------------------------
                                                        Authorized Officer



                                       45