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EMPLOYMENT
AGREEMENT This EMPLOYMENT AGREEMENT(Agreement) is by and between GameTech
International, Inc., a Delaware corporation (GameTech or the Company), and
Cornelius T. Klerk (Mr. Klerk or the Employee). Whereas:  a.
    
    The Company will employ Mr. Klerk as an at will employee for
a six month trial period as the Companys Chief Financial Officer and
Treasurer pursuant to a July 7, 2004 Letter Agreement, a copy of
which is attached as Exhibit A; andb.
    
    Assuming that the Company desires to continue to employ Mr.
Klerk in this capacity, and does not terminate his employment as
Chief Financial Officer and Treasurer by February 1, 2005 and
provide him with written notice of such termination by such date; andc.
    
    Assuming that Mr. Klerk is interested in continuing his
employment as the Companys Chief Financial Officer and Treasurer;
andd.
    
    Pursuant to this Agreement, the Company and Mr. Klerk set forth
their full and complete understandings as to the terms and conditions
of the continued employment relationship; NOW THEREFORE, in consideration of the covenants and provisions set forth
herein, the Company and Mr. Klerk agree as follows: 1. TERM OF AGREEMENT The Term of this Agreement shall be for a two (2) year period beginning
as of February 1, 2005 (the Term). The Term shall automatically renew for
successive one (1) year periods beginning February 1 of the applicable year,
unless the Agreement is terminated in accordance with the provisions of this
Agreement. 2. DUTIES OF EMPLOYEE During the Term of this Agreement, Employee shall be employed by the
Company as its Chief Financial Officer and Treasurer, and in that capacity
shall perform all functions and duties consistent with such position on behalf
of the Company in an adequate, efficient, trustworthy and professional manner,
as reasonably required by the Chief Executive Officer of the Company (CEO).
Employee shall report directly to the CEO unless the Company decides to change
the reporting structure. Employee agrees to devote substantially all of his working time and
energy to the performance of his duties under this Agreement so long as his
employment under this Agreement is continued by the Company. Notwithstanding
the foregoing, Employee shall be entitled to pursue outside activities so long
as such activities are approved by the CEO, do not involve a competitor of the
Company or 1




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its Enterprises, and do not materially interfere with Employees effective
performance of his duties under this Agreement. 3. DEFINITIONS For purposes of this Agreement, the following terms shall have the
meanings set forth in this Paragraph 3:  a.
    
    Annual Base Salaryor Base Salaryshall mean the
annual base salary
rate in effect for Employee from time to time during the Term
of this
Agreement in accordance with the provisions of Paragraph 4.a.
of this
Agreement.b.
    
    Annual Bonusor Bonusshall mean a cash payment
available to Employee in addition to Base Salary as determined
in accordance with Paragraph 4.b. of this
Agreement.c.
    
    Causeshall mean (i) any conduct by Employee which
jeopardizes or may jeopardize any license, consent,
registration, or other form of approval in any jurisdiction
that the Company does or seeks or may seek to do business; or
(ii) performance of work in a manner that is not adequate,
efficient, trustworthy or professional, as reasonably required
by the CEO, including dishonesty or insubordination; or (iii)
conviction for any felony; or (iv) any other act or omission by
Employee which is a breach of this Agreement, or is injurious
to the Company, or adversely impacts or threatens the Companys
business or reputation. The CEO shall have sole discretion to
determine if cause exists.d.
    
    Disabilityshall be deemed to have occurred if
Employee makes application for or is otherwise eligible
for disability benefits under
any Company-sponsored long-term disability program
covering
Employee, and Employee qualifies for such benefits. In
the absence
of a Company-sponsored long-term disability program
covering
Employee, Employee shall be presumed to be totally and
permanently disabled if so determined by the CEO following
the CEOs review of two independent medical opinions
satisfactory to the CEO certifying that Employee will be
permanently unable to perform his normal duties as a
result of a physical or mental condition.e.
    
    Enterpriseshall mean any joint venture,
business pursuant to a joint operating agreement, or
other alliance or affiliated business of the Company.f.
    
    Employees Spouseshall mean Employees spouse
upon the execution of this Agreement, except as otherwise
designated herein. (All spousal pension benefits under this
Agreement shall be non-transferable should Employee
remarry.) 2




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g.
    
    Fiscal Yearshall mean the twelve-month period
beginning November 1, unless the Company shall establish a
different fiscal year.h.
    
    Long-Term Incentive Planshall mean any stock
option plan or any other form of equity (real or phantom) or
other long-term incentive plan introduced by the Company.i.
    
    Serviceshall mean Employees employment with the
Company, or any affiliated organization, including any leave
of absence approved by the Board. 4. EMPLOYEE S RIGHTS WHILE EMPLOYED BY THE COMPANY  a.
    
    Base Salary.The Annual Base Salary payable to
Employee shall be One Hundred Seventy Thousand Dollars
($170,000.00). Such Base Salary shall be paid according to
the Companys normal payroll practices. Employees base
salary may be adjusted from time to time based on prevailing
market conditions, performance of the Employee and other
considerations.b.
    
    Bonus.Any bonus amount will be determined
by and awarded in the sole discretion of the CEO
and/or the Board of Directors; and/or any bonus amount
may be determined in accordance with a bonus plan
adopted by the Company.c.
    
    Long-Term Incentives.Employee may
participate in any Long-Term Incentive Plan that may
be designed specifically for Employee or provided to
other Employees of the Company during the Term. Such
benefits include the Companys granting of the 75,000
options to purchase shares of GameTech Common Stock,
pursuant to the July 7, 2004 Letter Agreement.  d.
    
    Other terms and conditions set forth in
July 7, 2004 Letter Agreement.The following terms
and conditions set forth in the July 7, 2004 Letter
Agreement shall remain binding on the parties:  (i)
    
    The Companys providing certain
insurance benefits, 401(k) Plan benefits, and 15
days of Paid Time Off (PTO) on an annual basis.
PTO accruals will be determined according to the
Companys PTO accrual policies.(ii)
    
    The Companys reimbursement of rental
and travel expenses, to the extent not already met;(iii)
    
    The Companys reimbursement of
relocation expenses up to $10,000; 3




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(iv)
    
    The Companys payment of $20,000
for brokers commissions related to the sale of
your Las Vegas residence, with Employee to
reimburse for this expense on a pro-rata basis
over two years.  e.
    
    Others.The Company shall provide
Employee with other benefits that the CEO and/or the
Board deem appropriate. 5. RIGHT TO TERMINATE EMPLOYMENT Nothing stated or implied by this Agreement shall prevent the Company
from terminating the Service of Employee at any time for Cause or without
Cause, nor prevent Employee from voluntarily terminating Service at any time.
Alternatively, either party may elect to not renew the Term of this Agreement.
To do so, no less than 120 days prior to the last day of the Term (whether it
is the initial or a subsequent term) either party must give the other party
written notice of its intent to not renew the Agreement at the end of such
term. 6. EMPLOYEES RIGHTS UPON TERMINATION OF SERVICE  a.
    
    For Reason Of Termination By The Company Without
Cause.In the event of Employees Termination of Service by
the Company without Cause, Employee (or if Employee dies
while benefits remain due under this Agreement, Employees
beneficiaries as designated in accordance with the provisions
of Paragraph 11 herein) shall be entitled to receive the
following upon such Termination of Service:  (i)
    
    Payment immediately upon Employees
Termination of Service of any previously unpaid Base
Salary and any Bonus granted and previously unpaid or
the pro-rata portion of any Bonus earned by Employee and
granted by the Company pursuant to any plan (if
necessary, the Company may pay such Bonus when all
bonuses for that Fiscal Year are calculated and paid)
through the date of Employees Termination of Service;(ii)
    
    Performance of Company obligations with respect to
Employees exercise of any stock options or other rights
previously granted to
Employee under any Company Long-Term Incentive Plan
provided
such options or other rights have vested as of the date
of the
termination of Employees service in accordance with any
agreement
between the Company and Employee covering such options
or other rights; and(iii)
    
    Payment of an amount equal to six (6)
months of Employees current Base Salary.  b.
    
    If Either Party Elects to Not Renew The Term Of
This Agreement.In the event either party elects to not
renew the Term of this Agreement, Employee (or if Employee
dies while benefits remain due under this Agreement, 4




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Employees beneficiaries as designated in accordance with the
provisions of Paragraph 11 thereof) shall be entitled to
receive the following upon such Termination of Service:  (i)
    
    Payment immediately upon Employees Termination of
Service of any previously
unpaid Base Salary and any Bonus granted and previously unpaid
or the
pro-rata portion of any Bonus earned by Employee and granted by
the Company
pursuant to any plan (if necessary, the Company may pay such
Bonus when all
bonuses for that Fiscal Year are calculated and paid) through
the date of
Employees Termination of Service;(ii)
    
    Performance of Company obligations with respect to Employees exercise
of any stock options or other rights previously granted toEmployee under any Company Long-Term Incentive Plan
provided
such options or other rights have vested as of the date
of the
termination of Employees service in accordance with
any agreement
between the Company and Employee covering such
options or other rights;(iii)
    
    Payment of any Disability or other benefits
provided to Employee by the Company in accordance with
the terms and conditions of such benefits and this
Agreement;  c.
    
    For Reason of Disability.In the Event of
Employees Termination of Service for reason of
Disability, Employee (or if Employee dies while benefits
remain due under this Agreement, Employees beneficiaries
as designated in accordance with the provisions of
Paragraph 11 hereof) shall be entitled to receive the
following upon such Termination of Service:  (i)
    
    Payment immediately upon Employees Termination of
Service of
any previously unpaid Base Salary and any Bonus granted
and
previously unpaid or the pro-rata portion of any Bonus
earned by
Employee and granted by the Company pursuant to any
plan (if necessary, the Company may pay such Bonus
when all bonuses for that Fiscal Year are calculated
and paid) through the date of Employees Termination
of Service;(ii)
    
    Performance of Company obligations with respect to
Employees exercise of any stock options or other rights
previously granted to
Employee under any Company Long-Term Incentive Plan
provided
such options or other rights have vested as of the date
of the
termination of Employees service in accordance with any
agreement
between the Company and Employee covering such options
or other rights; 5




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(iii)
    
    Payment of any Disability or other
benefits provided to Employee by the Company in
accordance with the terms and conditions of such
benefits and this Agreement;(iv)
    
    Payment of an amount equal to six (6)
months of Employees Annual Base Salary.  d.
    
    For Reason of Death. In the Event of
Employees Termination of Service for Reason of Death.
Employees beneficiaries as designated in accordance with
the provisions of Paragraph 11 hereof shall be entitled to
receive the following upon such Termination of Service:  (i)
    
    Payment immediately upon Employees
Termination of Service of any previously unpaid Base
Salary and any Bonus granted and previously unpaid or
the pro-rata portion of any Bonus earned by Employee
and granted by the Company pursuant to any plan (if
necessary, the Company may pay such Bonus when all
bonuses for that Fiscal Year are calculated and paid)
through the date of Employees Termination of Service.(ii)
    
    Performance of Company obligations with
respect to Employees exercise of any stock options or
other rights previously granted to Employee under any
Company Long-Term Incentive Plan provided
such options or other rights have vested as of the date
of the termination of Employees service in
accordance with any agreement between the Company and
Employee covering such options or other rights;(iii)
    
    Payment of any other benefits provided by
the Company in accordance with the terms and conditions
of such benefits and this Agreement;(iv)
    
    Payment of an amount equal to six (6)
months of Employees Annual Base Salary.  e.
    
    For Reason Of Voluntary Resignation.In the
event of Employees Termination of Service for reason of
voluntary resignation by Employee not constituting
Constructive Termination, Employee shall be entitled to
receive the following upon such Termination of Service:  (i)
    
    Payment immediately upon Employees
Termination of Service of any previously
unpaid Base Salary and any Bonus granted and
previously unpaid or the pro-rata portion of any Bonus
earned by Employee and granted by the Company
pursuant to any plan (if necessary, the Company may pay
such Bonus when all bonuses for that Fiscal Year are
calculated and paid) through the date of Employees
Termination of Service; 6




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(ii)
    
    Performance of Company obligations with
respect to Employees exercise of any stock options or
other rights previously granted to
Employee under any Company Long-Term Incentive Plan
provided
such options or other rights have vested as of the date
of the
termination of Employees service in accordance with any
agreement
between the Company and Employee covering such options or
other
rights;(iii)
    
    Payment of any Disability or other benefits
provided to Employee by the Company in accordance with
the terms and conditions of such benefits and this
Agreement.  f.
    
    For Reason of Cause.In the Event of Employees
Termination of Service for reason of Cause, the Companys
obligations to Employee shall be limited to:  (i)
    
    Payment immediately upon Employees Termination of
Service of any
previously unpaid Base Salary;(ii)
    
    Performance of Company obligations with respect to
Employees exercise of
any stock options or other rights previously granted to
Employee under any
Company Long-Term Incentive Plan provided such options or other
rights
have vested as of the date of the termination of Employees
service in
accordance with any agreement between the Company and Employee
covering such options or other rights.(iii)
    
    In the event that Employee is terminated for cause,
Employees rights to any additional compensation and benefits
under this Agreement shall immediately terminate. 7. CONFIDENTIALITY a. Obligations Regarding Confidential Information.Employee agrees to not
use or disclose any Confidential Information (as defined below) except in the
authorized and lawful performance of his duties for the benefit of the Company.
Employee shall only disclose Confidential Information to those persons
employed by the Company or affiliated with the Company who need to know such
Confidential Information. Employee shall take all reasonable measures to
protect Confidential Information from any accidental, unauthorized, or
premature use, disclosure or destruction. b. Definition of Confidential Information.For purposes of this
Agreement, the term Confidential Information includes but is not limited to
any Company trade secrets, technical information, inventions, discoveries,
know-how, ideas, computer programs, designs, algorithms, product information,
research and development information, lists of clients and other information
relating thereto, financial data, and business, marketing, sales and
operational plans, strategies and processes, and other information that is
related to the Company and non-public. Confidential Information may or may not
be labeled as Confidential. Confidential Information may include 7




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information provided by third parties to the Company. Confidential
Information does not include, however, the following: (a) information that is
or becomes generally available to the public other than as a result of my
disclosure of such information, (b) information that was within my possession
prior to it being furnished to me by or on behalf of the Company, provided that
the source of such information was not known to me to be bound by a
confidentiality agreement with or other contractual, legal or fiduciary
obligation of confidentiality to the Company or any other party with respect to
such information, (c) information that becomes available to me on a
non-confidential basis from a source other than the Company, provided that such
source is not known to me to be bound by a confidentiality agreement with or
other contractual, legal or fiduciary obligation of confidentiality to the
Company or any other party with respect to such information, (d) information
the disclosure of which is required by applicable law or judicial process, or
(e) general technical skills or general experience gained by me during my
employment with the Company. c. Length of Such Obligation.Employee shall protect Confidential
Information as defined above throughout his employment with the Company, and
such obligation shall remain in effect after the termination of his employment
for as long as any Confidential Information remains confidential. d. Return of Confidential Information.Upon termination of my employment
with the Company for any reason, or at any time upon request of the Company, I
agree to deliver to the Company all materials of any nature, including
originals and all copies and facsimiles, which are in my possession or control
and which are or contain Confidential Information, or which are otherwise the
property of the Company or of any Company vendor, licensor or client or any
third party working with the Company, including, but not limited to writings,
designs, documents, records, data, memoranda, tapes and disks containing
software, computer source code listings, routines, file layouts, system design
information, models, manuals, documentation and notes. 8. NON-SOLICITATION AND NON-COMPETITION During the Term of this Agreement and for a period of one year immediately
following the termination of Employees employment (or retirement by Employee),
for any reason whatsoever, Employee shall not, for any reason whatsoever,
directly or indirectly, for him or on behalf of, or in conjunction with, any
other person, persons, company, partnership, corporation or business entity: (i) call upon, divert, influence or solicit, or cause the calling upon,
diversion, influencing solicitation of, any customer or employee or
vendor of the Company in a manner which may adversely impact the Company
or its Enterprises; (ii) own, manage, operate, control, be employed by, participate in or be
connected in any manner with the ownership, management, operation or
control of the same, similar, or related line of business as that carried
on by Company or its Enterprises; or (iii) compete with the Company or its Enterprises. The covenants set forth herein shall not include any period(s) of
violation of any
covenant or any period(s) of time required for litigation to enforce any
covenant. In the event that Employee violates any part of this provision,
Employees rights to any compensation and benefits under this Agreement shall
immediately terminate. This provision shall not apply to any 8




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investment by Employee in the stock of a publicly-traded corporation, provided
such investment constitutes less than five percent (5%) of such corporations
voting shares. 9. INVENTION DISCLOSURE AND ASSIGNMENT Employee agrees to promptly disclose in confidence to the Company
all inventions, improvements, designs, original works of authorship,
formulas, processes, compositions of matter, computer software programs,
databases, mask works and trade secrets (the Inventions) that he makes
or conceives or first reduces to practice or creates, either alone or
jointly with others, during the period of his employment, whether or not
in the course of his employment, and whether or not such Inventions are
patentable, copyrightable or protectable as trade secrets. In addition,
Employee acknowledges and agrees that any copyrightable works prepared by
him within the scope of his employment are works for hire under the
Copyright Act and that the Company will be considered the author and
owner of such copyrightable works. Employee agrees that all Inventions
that (i) are developed using equipment, supplies, facilities or trade
secrets of the Company, (ii) result from work performed by Employee for
the Company, or (iii) relate to the Companys business or current or
anticipated research and development (the Assigned Inventions), will be
the sole and exclusive property of the Company and are hereby irrevocably
assigned by Employee to the Company. 10. NO BREACH OF PRIOR AGREEMENT; INDEMNIFICATION Employee represents that his employment with the Company and his
performance of the duties and functions contemplated under this Agreement will
not breach any invention assignment, proprietary information, confidentiality,
non-competition or similar agreement with any former employer or other party.
Employee agrees that if any one asserts a claim or lawsuit against the Company
on the grounds that the Company has committed a wrong arising out of the
Companys employment of Employee and the Employees performance of the duties
and functions contemplated under this Agreement, Employee shall hold harmless,
defend and indemnify the Company. Employee cannot make any decisions regarding
defense and indemnity of the Company without its consent, which will not be
unreasonably withheld 11. DESIGNATION OF BENEFICIARIES Employee shall have the right at any time to designate any person(s) or
trust(s) as beneficiaries to whom any benefits payable under this Agreement
shall be made in the event of Employees death prior to the distribution of all
benefits due Employee under this Agreement. Each beneficiary designation shall
be effective only when filed in writing with the Company during Employees
lifetime. If Employee designates more than one beneficiary, distributions of
cash payments shall be made in equal proportions to each beneficiary unless
otherwise provided for in Employees beneficiary designation. The filing of a new beneficiary designation shall cancel all designations
previously filed. Any finalized marriage or divorce (other than common law
marriage) of Employee subsequent to the date of filing a beneficiary
designation shall revoke such designation unless (a) in the case of
divorce, the previous spouse was not designated as beneficiary, and (b) in the
case of marriage,Employees new spouse had previously been designated as beneficiary.
Employees
Spouse shall 9




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join in any designation of a beneficiary other than Employees Spouse. If Employee fails to designate a beneficiary as provided for above, or if
the beneficiary designation is revoked by marriage, divorce or otherwise
without execution of a new designation, or if the beneficiary designated by
Employee dies prior to distribution of the benefits due Employee under this
Agreement, the Company shall direct the distribution of any benefits due under
this Agreement to Employees estate. 12. SUCCESSORS Except as provided for in Paragraph 11 above, the rights and duties of a
party hereunder shall not be assignable by that party, provided, however, that
this Agreement shall be binding upon and shall inure to the benefit of any
successor of the Company, and any such successor shall be deemed substituted
for the Company under the terms of this Agreement. The term successor as used
herein shall include any person, firm, corporation or other business entity
which at any time, by merger, purchase or otherwise, acquires substantially all
of the assets or business of the Company. 13. ARBITRATION The Company and Employee agree with each other that any claim of Employee
arising out of or relating to this Agreement or the breach of this Agreement or
Employees employment by Company, including, without limitation, any claim for
breach of this Agreement, wrongful termination, and any employment related
claim such as discrimination or harassment in any form, shall be resolved by
binding arbitration, except for claims in which injunctive relief is sought and
obtained. The arbitration shall be administered by the American Arbitration
Association under its Commercial Arbitration Rules in Reno, Nevada. The award
entered by the arbitrator shall be final and binding in all respects and
judgment thereon may be entered in any Court having jurisdiction. 14. APPLICABLE LAW; INJUNCTIVE RELIEF; CONSENT TO PERSONAL
JURISDICTION; ATTORNEYS FEES AND COSTS To the full extent controllable by stipulation of the Company and
Employee, this Agreement shall be interpreted and enforced under Nevada law,
without regard to conflict of law principles. Employee recognizes that
violation of certain provisions of this Agreement will cause the Company
irreparable injury and that the Company will be entitled to seek injunctive
relief in the event of such a violation, in addition to whatever other remedies
may be available to the Company at law or otherwise. Employee consents to the
personal jurisdiction of the state and federal courts located in the County of
Washoe in the State of Nevada for any lawsuit filed there for injunctive relief
against Employee by the Company arising from this Agreement. In any action or
effort to enforce any of the provisions or rights under this Agreement, the
unsuccessful party to such litigation or effort shall pay the successful party
or parties all reasonable attorneys fees and costs incurred by such party. 10




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15. ENTIRE AGREEMENT; VALIDITY With the exception of the July 7, 2004 Letter Agreement attached hereto as
Exhibit A and the standard confidentiality and non-disclosure agreement, this
Agreement contains the entire agreement between the Company and Employee and
supersedes all prior written agreements, understandings and commitments between
the Company and Employee. No amendments to this Agreement may be made except
through a written document signed by the Employee and approved in writing by
the CEO. In the event that any provision of this Agreement is held to be
invalid, void or unenforceable, the same shall not affect, in any respect
whatsoever, the validity of any other provision of this Agreement. 16. NOTICE Any notice or demand required or permitted to be given under this
Agreement shall be made in writing and shall be deemed effective upon the
personal delivery thereof if delivered or, if mailed, forty-eight (48) hours
after having been deposited in the United States mail, certified mail, return
receipt requested, and addressed, in the case of the Company, to the attention
of the CEO at the Companys then principal place of business, presently 900
Sandhill Road, Reno, Nevada 89521, and, in the case of Employee, to a personal
address that Employee has provided to GameTech and that GameTech reasonably
believes is a current personal address. Either party may change the address to
which such notices are to be addressed to it by giving the other party notice
in the manner herein set forth. 17. COUNTERPARTS This Agreement may be executed in any number of counterparts, each of
which when so executed and delivered will be deemed an original, and all of
which together shall constitute one and the same agreement. 18. EFFECTIVE DATE This Agreement shall be binding upon the parties as of the date signed by
both parties, and shall become effective as of February 1, 2005. However, this
Agreement shall become null and void if the Company exercises its right to
terminate Employees employment by February 1, 2005 and the Company provides
Employee with written notice terminating his employment by February 1, 2005. IN WITNESS WHEROF,the Company has caused this Agreement to be executed by
its duly authorized representative, and Employee has affixed his signature. Dated:
    
    Dated:EMPLOYEE
    
    GAMETECH INTERNATIONAL, INC.By:/s/ Cornelius T. KlerkName:Cornelius T.
KlerkTitle:Chief
Financial Officer
 11