Document:

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                                                                   EXHIBIT 10.12

                                [GRAPHIC OMITTED]

                     FLEXIBLE PERQUISITE PROGRAM GUIDELINES

UPDATED:  JANUARY 1, 2000
REVISED:  OCTOBER, 1996

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<TABLE>

<CAPTION>

                                TABLE OF CONTENTS
                                -----------------

<S>                                                                       <C>
CONTACT LIST.................................................................5

FLEXIBLE PERQUISITE PROGRAM GUIDELINES.......................................6

   OBJECTIVE.................................................................6

OVERVIEW.....................................................................7

   CORE PERQUISITES..........................................................7
   ADDITIONAL FLEXIBLE PERQUISITES...........................................7
   SPECIAL BENEFITS..........................................................8
   TAX IMPLICATION...........................................................8
   EFFECTIVE DATE OF PROGRAM.................................................8
   ELIGIBILITY...............................................................8
   ELIGIBILITY AFTER JANUARY 1 OF PROGRAM YEAR...............................9
   ELIGIBILITY CHANGES.......................................................9
      JOB LEVEL ASSIGNMENT...................................................9
      DISABILITY............................................................10
      RETIREMENT............................................................10
      DEATH.................................................................10
      TERMINATION FOR OTHER REASONS.........................................11
      COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION................11
   FLEXIBLE PERQUISITE ALLOWANCE............................................12
      COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION................12

CORE PERQUISITES............................................................13

   COMPANY CAR..............................................................13
      SELECTION OF CAR......................................................13
      MAINTENANCE...........................................................13
      INSURANCE.............................................................13
      RETENTION.............................................................13
   COMPANY-CAR UPGRADE......................................................14
      UPGRADE APPROVAL......................................................14
      COMPANY-CAR TAX IMPLICATION...........................................15
      ANNUAL-LEASE VALUE IMPUTATION.........................................15
      COMPANY-CAR UPGRADE IMPUTATION........................................16
      CHANGE IN JOB LEVEL...................................................16
      COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION................16
   EXECUTIVE MEDICAL/DENTAL.................................................17
      TAX IMPLICATION.......................................................17
      ENROLLMENT............................................................17
      ELIGIBLE DEPENDENTS...................................................17
      COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION................17
   BUSINESS TRAVEL ACCIDENT INSURANCE.......................................18
      TAX IMPLICATION.......................................................18
      ENROLLMENT............................................................18
      BENEFICIARY...........................................................18
      COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION................18

</TABLE>

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<TABLE>

<CAPTION>

<S>                                                                       <C>
   EXECUTIVE LIFE INSURANCE.................................................20
      ENROLLMENT/CANCELLATION...............................................20
      COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION................21
   EXECUTIVE PERSONAL AUTO INSURANCE      ..................................23
      ELIGIBLE DEPENDENTS...................................................23
      ENROLLMENT/CANCELLATION...............................................24
      IMPUTED INCOME........................................................24
      COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION................24
   EXECUTIVE EXCESS LIABILITY INSURANCE.....................................25
      ENROLLMENT/CANCELLATION...............................................26
      COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION................27
CLUB INITIATION FEES........................................................28

DISCLOSURE..................................................................28

</TABLE>

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The Program described in this booklet does not create or give any contractual
rights to any employee nor is it evidence of any contract or covenant of
employment. Nabisco reserves the right to modify, revoke, suspend or change any
program or service that is described. This booklet is the property of Nabisco
and may not be reproduced or distributed outside the Company without the
permission of the Executive Vice President and Chief Personnel Officer.

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<PAGE>

                          NABISCO, INC. -- CONTACT LIST
                          -----------------------------

                             EXECUTIVE COMPENSATION
                             ----------------------
     MICHELLE PEDULLA                                     SUSAN REUTER
     (973) 503-3094                                       (973) 503-3881

                             Nabisco, Inc.
                             100 DeForest Avenue
                             East Hanover, NJ  07936
                             Fax: (973) 503-3223

PLEASE NOTE: ALL ENROLLMENT AND CANCELLATION FORMS SHOULD BE MAILED DIRECTLY TO
                               MICHELLE PEDULLA.

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

                                     MEDICAL
                                     -------

                              MARY MAYERL
                              Executive Claim
                              Aetna Life & Casualty
                              P.O. Box 31450
                              Tampa, FL  33631-3450
                              (813) 775-0138

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

                                     DENTAL
                                     ------

              DON HICKEY                                     WENDY GUILLERMAIN
              (973) 285-4086                                 (973) 285-4207

                               Delta Dental
                               1639 Route 10
                               Parsippany, NJ  07054

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

                                      FLEET
                                      -----

              BILL KIDDLE                                   ALICE GREENE
              (973) 503-2767                                (973) 503-2773

                               Nabisco, Inc.
                               100 DeForest Avenue
                               East Hanover, NJ 07936

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

                                 RISK MANAGEMENT
                                 ---------------

                              PAMELA PLAZA
                              Nabisco, Inc.
                              7 Campus Drive
                              Parsippany, NJ 07054
                              (973) 682-7310

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<PAGE>

                     FLEXIBLE PERQUISITE PROGRAM GUIDELINES
                     --------------------------------------

OBJECTIVE

The Flexible Perquisite Program has been designed to offer executive perquisites
which consider executives' personal needs by providing "choice" in selecting
perquisites and perquisite providers. The Program enables executives to avail
themselves of those perquisites most suitable to his/her individual needs
utilizing a flexible perquisite allowance. The Program is based upon the results
of a competitive total compensation analysis and will be reviewed annually to
ensure its continued competitiveness.

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<PAGE>

                                    OVERVIEW
                                    --------

The Flexible Perquisite Program allows eligible executives to make independent
decisions, which provide them with lifestyle-sensitive enhancements.

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

This Program consists of a Flexible Perquisite Allowance and Core Perquisites,
as follows:

-    FLEXIBLE PERQUISITE ALLOWANCE

     A flexible perquisite allowance will be granted based on the executive's
     Job Level at the beginning of each Program year. The perquisite allowance
     will be paid to the executive in four quarterly payments. At the end of
     each quarter, a payment less appropriate taxes will be issued, via direct
     deposit or check, whichever is applicable.

     An executive, who is actively employed by the Company, will have an
     opportunity to participate in the Nabisco Deferred Compensation Plan and
     defer up to 100% of his/her allowance. However, no deferral election shall
     reduce his/her compensation below the amount necessary to satisfy
     applicable employment taxes (e.g., FICA/Medicare), Company-sponsored
     insurance and/or Company-car upgrade amounts purchased under the Flexible
     Perquisite Program.

CORE PERQUISITES

               -    Company car
               -    Executive Medical/Dental Insurance
               -    Business Travel Accident Insurance
               -    Club initiation fee

ADDITIONAL FLEXIBLE PERQUISITES

     An executive may purchase Company-sponsored Insurance programs and
     Individual Selection, as follows:

          -    Company-car upgrade

          -    Company-Sponsored Insurance:

                    >>   EXECUTIVE LIFE INSURANCE
                    >>   EXECUTIVE PERSONAL AUTO INSURANCE
                    >>   EXECUTIVE EXCESS LIABILITY INSURANCE

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SPECIAL BENEFITS

     Upon eligibility to the Flexible Perquisite Program, an executive will also
     receive the following special benefits:

          -    First Class Travel
          -    Reserved Parking Space
          -    Corporate Executive Credit Card

TAX IMPLICATION

-    FLEXIBLE PERQUISITES: The flexible perquisite allowance is taxable and
     Federal tax will be withheld at the rate of 28

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     minimum rate.

-    CORE PERQUISITES: Business Travel Accident Insurance is non-taxable to the
     executive. The entire Annual Lease Value (ALV) of an executive's Company
     car is taxable income and imputed to his/her income each pay period during
     the Program year. Such amount will be reduced based on the ratio of
     business to personal miles in December of the Program year (refer to
     Company car section for further details).

-    ADDITIONAL PERQUISITES: An executive's income will be imputed based on the
     value of insurance benefit(s) purchased, i.e., life insurance, personal
     auto insurance and excess liability premiums in December of the Program
     year. The Company-car upgrade imputation will occur each pay period during
     the Program year (refer to Company car section for further details).

EFFECTIVE DATE OF PROGRAM

January 1, 1991

PROGRAM YEAR

January 1 - December 31

ELIGIBILITY

Participation in the Flexible Perquisite Program is limited to executives whose
Job Levels are included in the Executive Salary Structure. Each executive's
flexible perquisite allowance is determined by his/her Job Level within the
Executive Salary Structure.

<PAGE>

ELIGIBILITY AFTER JANUARY 1 OF PROGRAM YEAR

If eligibility occurs after January 1 of a Program year, the executive will be
eligible for Core Perquisites and a prorata perquisite allowance for his/her Job
Level.

ELIGIBILITY CHANGES

JOB LEVEL ASSIGNMENT

If an executive is PROMOTED TO A HIGHER JOB LEVEL, the adjusted perquisite
allowance balance will be based on the prorata allowance variance between the
allowance designated for the CURRENT JOB LEVEL and the NEW JOB LEVEL. Such
amount will be ADDED to the current balance. The proration will be effective as
of the date of promotion.

Example:

On January 1, a Grade D executive is granted a $25,000 flexible perquisite
allowance. The executive utilizes $10,000 between January 1 and June 30. On July
1, the executive is promoted to Grade C and is entitled to a flexible allowance
of $32,500. The difference between the two Job Levels is $7,500. This variance
is prorated based on the number of months in the new Job Level during the
Program year, namely, six (6) months and is equal to $3,750.

Therefore, the executive has an adjusted allowance balance on July 1 of $18,750,
as follows:

<TABLE>

<CAPTION>

                                                        ALLOWANCES

    <S>                                               <C>
      Job Level D-January 1 Allowance                     $25,000
      January 1-June 30 Allowance Used                    (10,000)
                                                         --------
      Balance                                              15,000
      Promotion to Job Level C                              3,750  prorata
                                                            -----
      July 1 Adjusted Allowance Balance                   $18,750

</TABLE>

If an executive is ASSIGNED TO A LOWER-GRADED JOB LEVEL THAT IS STILL ELIGIBLE
FOR THE PROGRAM, the executive will maintain the flexible perquisite allowance
granted on January 1 for the balance of the Program year, as well as Core
Perquisites. The allowance will then be adjusted for the appropriate level
commencing the following January 1.

If an executive REQUESTS A TRANSFER TO A LOWER-GRADED JOB LEVEL THAT IS STILL
ELIGIBLE FOR THE PROGRAM, the adjusted allowance balance will be based on the
prorata allowance variance between the allowance designated for the CURRENT JOB
LEVEL and the NEW JOB LEVEL. Such amount will be SUBTRACTED from the current
balance (the resultant minimum allowance balance is zero). The proration will be
effective as of the date of event. If the executive REQUESTS A TRANSFER TO A
LOWER-GRADED JOB LEVEL THAT IS NO LONGER ELIGIBLE FOR THE PROGRAM, the remaining

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flexible perquisite allowance and Core Perquisites will cease immediately.
However, the executive may purchase his Company car.

If an executive is ASSIGNED TO A JOB LEVEL THAT IS NO LONGER ELIGIBLE FOR THE
PROGRAM, the executive will remain in the Program for six (6) months or the
remainder of the Program year, whichever is longer. If participation extends
into the next Program year, the flexible perquisite allowance granted in the
year of loss of eligibility will be "frozen" and prorated. Core Perquisites will
be retained. The executive will be paid the prorated perquisite allowance on the
next scheduled quarterly payout, via direct deposit or check, whichever is
applicable. Federal Income Tax will be withheld at the 28% minimum rate.

DISABILITY

If an executive is placed on SHORT-TERM DISABILITY (STD), the executive will
remain in the Program during such period.

If an executive is placed on LONG-TERM DISABILITY (LTD), the executive will
continue in the Program. However, the executive's status as an eligible
participant will be reviewed annually. The flexible perquisite allowance granted
in the year LTD begins will be "frozen" and no new leased-Company car may be
selected.

RETIREMENT

If an executive RETIRES, all benefits of the Program will cease immediately,
except for Personal Auto Insurance and Excess Liability Insurance which may be
continued for three (3) months. Effective with the executive's retirement date,
the allowance granted on January 1 of the Program year will be prorated based on
the executive's active service in such year. The executive will be paid, via
direct deposit or check, whichever is applicable, the prorated perquisite
allowance on the next scheduled quarterly payout. Federal Income Tax will be
withheld at the 28% minimum rate.

DEATH

If the executive DIES, all benefits of the Program will cease three (3) calendar
months from the month death occurs. The flexible perquisite allowance granted on
January 1 of the Program year will be prorated based on the executive's active
service in such Program year plus three (3) additional calendar months after the
month of death. Any allowance used year-to-date will be deducted from such
adjusted flexible perquisite allowance. If the three-month period extends into
the next Program year, the flexible perquisite allowance granted in the year of
death will be "frozen" and prorated. At the end of the three-month period, a
check representing the unused flexible perquisite allowance balance, if any,
will be issued to the executive's spouse. If the executive does not have a
spouse, a check will be issued to the executive's beneficiary under SELECT Core
Life Insurance.

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<PAGE>

The title of the Company car will be transferred to the executive's spouse at no
cost. If the executive does not have a spouse, the executive's beneficiary under
SELECT Core Life Insurance will have this vehicle transfer option.

TERMINATION FOR OTHER REASONS

If the executive VOLUNTARILY RESIGNS or is TERMINATED FOR CAUSE, all benefits of
the Program will cease as of the resignation/termination date. The executive
WILL NOT have the option to purchase the Company car.

COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION

If an executive is involuntarily terminated without cause and placed on
severance under the terms of an Employment Agreement or the Salary & Benefits
Continuation Program, the executive shall continue to receive benefits under the
Flexible Perquisite Program for the period of such severance, except for
Business Travel Accident Insurance. The perquisite allowance will be "frozen"
based on the executive's current job level at the time the executive begins
Compensation Continuance/Salary & Benefits Continuation. Except as noted below,
the executive shall have an opportunity to purchase his/her Company car at the
Company determined price.

However, in the event of an involuntary termination without cause during the
two-year period beginning on a Change of Control, as defined by the Company,
ownership of the Company car assigned to the executive immediately prior to such
involuntary termination without cause shall be transferred to the executive
within 15 business days from the end of the Compensation Continuance/Salary &
Benefits Continuation period. At the time of such automobile transfer, the
Company shall pay to the executive such amount in cash that, after payment of
all applicable federal, state and local taxes thereon, computed at the maximum
marginal rates, is equal to all such taxes, so computed imposed in connection
with such transfer.

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<PAGE>

FLEXIBLE PERQUISITE ALLOWANCE

A flexible perquisite allowance will be granted annually based on the
executive's Job Level at the beginning of each Program year. A prorata
adjustment to such allowance will be made upon promotion to a higher Job Level
during the Program year. The executive may purchase Company-sponsored
Insurance(s) and a Company-car upgrade.

An executive, who is actively employed by the Company, will have an opportunity
to participate in the Nabisco Deferred Compensation Plan and defer up to 100% of
his/her perquisite allowance each Program year. However, no deferral election
shall reduce his/her compensation below the amount necessary to satisfy
applicable employment taxes (e.g., FICA/Medicare), Company-sponsored insurance
and/or Company-car upgrade amounts purchased under the Flexible Perquisite
Program.

Enrollment will occur in November prior to each Program year. For additional
details, please refer to the Nabisco Deferred Compensation Plan Booklet or
contact Executive Compensation (see Contact List located in Appendix).

COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION

If an executive is placed on Compensation Continuance/Salary & Benefit
Continuance, the flexible perquisite allowance will be "frozen", based on the
executive's current job level at the time the executive begins Compensation
Continuance/Salary & Benefit Continuation. Such flexible perquisite allowance
will continue until the end of Compensation Continuance/Salary & Benefit
Continuation.

                                       12
<PAGE>

                                CORE PERQUISITES
                                ----------------

COMPANY CAR

SELECTION OF CAR

Each executive may select a Company car of his/her choice subject to the
following limitations. The cost to the Company shall not exceed the allowable
Fair-Market Value (FMV) amount determined by Management. The maximum allowable
FMV will increase incrementally by Job Level. For the purpose of this Program,
only new cars may be selected by the executive.

An executive who wishes to obtain a car should contact the Fleet Department (see
Contact List located in the Appendix) who will provide additional information.

MAINTENANCE

Receipts covering fuel, oil, tires and other normal maintenance costs of the
vehicle (including car washes) are reimbursable when submitted on approved
expense reports.

INSURANCE

Company car insurance is administered by Risk Management. Therefore, the
executive is not required to obtain auto insurance.

RETENTION

Company car will be retained for 50-months or 60,000 miles, whichever occurs
first. The executive may purchase his/her Company car at the end of the 50-month
lease period or prior to the end of the 50-month lease period due to 60,000
miles, involuntary termination without cause, overseas assignment or Long-Term
Disability.

If the executive dies, the title of the car will be transferred to the
beneficiary at no cost to the beneficiary. For tax purposes, the executive's
income will be grossed up by the amount of the FMV of the car at the time of
transfer. Upon a domestic relocation, the executive will retain his/her Company
car at the new location.

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<PAGE>

COMPANY-CAR UPGRADE

An executive may select a Company car with a higher FMV than his/her maximum
allowable FMV. However, the DIFFERENCE BETWEEN THE ALLOWABLE ANNUAL LEASE VALUE
(ALV) AND THE ACTUAL ALV WILL BE DEDUCTED FROM THE EXECUTIVE'S ALLOWANCE at the
beginning of each Program year during the 50-month lease period or 60,000 miles,
whichever occurs first, and will be prorated for partial-year leases, i.e. lease
inception/termination, whichever occurs first.

The executive may use all of his/her available perquisite allowance in addition
to his/her FMV level amount (ALV) to lease a car.

Example:

The executive is entitled to a Company car with a FMV of $29,999 for which the
ALV is $7,750. The executive advises the Fleet Department of the car the
executive wants to lease. The Fleet Department is able to obtain the car for
$31,999 (excludes tax, title, and registration fee). The ALV is $8,250.
Therefore, $500 allowance will be deducted from the executive's account at the
beginning of each Program year during the 50-month lease period or 60,000 miles,
whichever occurs first. If the lease begins or expires during the Program year,
the cost will be prorated. This is based on the ALV Table variance of the
maximum FMV versus the upgraded FMV (See IRS Annual Lease Value table located in
the Appendix), as follows:

<TABLE>

<CAPTION>

                                                      Allowance
                          FMV           ALV TABLE     REQUIRED
                          ---           ---------     --------
<S>                      <C>             <C>         <C>
       Company car       $29,999         $7,750
       Upgrade           $31,999         $8,250         $500

</TABLE>

UPGRADE APPROVAL

If an executive wishes to upgrade the FMV of his/her Company car, prior approval
by Executive Compensation is required to determine available perquisite
allowance dollars in such year. If the Company car the executive has selected
exceeds the executive's maximum allowable FMV, the FLEET DEPARTMENT SHOULD:

1.   Contact Executive Compensation to obtain verbal approval.
2.   Complete their portion of the "Company-car Upgrade" form (FP-8) and send it
     to Executive Compensation.

                                       14
<PAGE>

COMPANY-CAR TAX IMPLICATION

ANNUAL-LEASE VALUE IMPUTATION

If the Company car is driven solely for personal use during the 12-month period
ending October 31 of each year, the entire ALV will be taxable income. If it is
used partially for business purposes, the taxable amount will be reduced by the
percentage of the car's substantiated business mileage versus total mileage
during that period. IRS regulations require imputation of a fuel charge for all
personal usage. The present fuel charge imputation is 5.5 cents per mile for
personal use.

Commuting between the executive's home and regular office is considered a
personal trip, not business. As of October 31 of each year, each executive will
receive a Business/Personal Mileage Statement and will be responsible for
providing the percentage of personal versus business mileage. Therefore, it is
required that the executive maintain a log of miles driven for business/personal
usage.

BUSINESS USAGE of personal cars is not reimbursable on a Company expense report,
except in an extraordinary situation. (See "Maintenance").

EXAMPLE OF THE BUSINESS/PERSONAL USAGE CALCULATION:

Period:  November 1 through October 31

<TABLE>

<CAPTION>

                                                     APPROVED              ACTUAL                   # MONTHS
                                                     --------              ------                   --------

<S>                                               <C>                     <C>                       <C>
Fair-Market Value:                                   $29,999               $31,999                     12
Annual Lease Value:                                  $ 7,750               $ 8,250
          Taxable Income:   $ 7,750                       Taxable Income equals the lesser of the approved or actual ALV.
COMPANY-CAR BUSINESS/PERSONAL MILE USAGES

Personal miles driven 11/1 through 10/31:            12,000
Business miles driven 11/1 through 10/31:             3,000
                                                      -----
Total Miles:                                         15,000
Personal miles as a percent of total miles:            80.0%   12,000 personal miles divided by               15,000 total miles
Annual Taxable Income:                            $6,200.00    $7,750 ALV times                                 80.0%
Personal miles driven times 5.5 cents per mile:     $660.00    12,000 personal miles times 5.5 cents
                                                   --------
Imputed Income:                                   $6,860.00
Less Payroll YTD Offset:                         ($7,104.17)    [AS OF 11/30]
                                                -----------
Total Actual Imputed Income:                       ($244.17)     imputed imputed over 12/15 and 12/30 payroll periods. i.e.,
                                                                ($122.08) per payroll

</TABLE>

                                       15
<PAGE>

COMPANY-CAR UPGRADE IMPUTATION

An executive's income will be imputed for the Company-car upgrade during the
Program year, if applicable.

CHANGE IN JOB LEVEL

-    PROMOTION - If an executive is promoted to a higher Job Level and has a
     Company-car upgrade, the upgrade cost will be recalculated based on the
     allowance for the new Job Level.

-    DEMOTION - If an executive's Job Level is reduced at the Company's request
     and the executive is still eligible for participation in the Program, the
     executive may retain the use of the CURRENT Company car through the end of
     the lease period or 60,000 miles, whichever occurs first. A new car may
     then be selected based on the allowable FMV of the executive's new Job
     Level.

COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION

If an executive is involuntarily terminated without cause and placed on
severance under the terms of an Employment Agreement or the Salary & Benefit
Continuation Program, the executive shall continue to receive benefits under the
Flexible Perquisite Program for the period of such severance, except for
Business Travel Accident Insurance. Except as noted below, the executive shall
have an opportunity to purchase his/her Company car at the Company determined
price. If a lease expires prior to the completion of Compensation
Continuance/Salary & Benefit Continuation, the current lease will be extended.
However, effective on that date, the imputed income will be based on the then
current FMV of the leased-Company car versus the original lease cost of the car.
A new car or lease will not be provided during this period.

However, in the event of an involuntary termination without cause during the
two-year period beginning on a Change of Control, as defined by the Company,
ownership of the Company car assigned to the executive immediately prior to such
involuntary termination without cause shall be transferred to the executive
within 15 business days from the end of the Compensation Continuance/Salary &
Benefits Continuation period. At the time of such automobile transfer, the
Company shall pay to the executive such amount in cash that, after payment of
all applicable federal, state and local taxes thereon, computed at the maximum
marginal rates, is equal to all such taxes, so computed imposed in connection
with such transfer.

                                       16
<PAGE>

                                CORE PERQUISITES
                                ----------------

EXECUTIVE MEDICAL/DENTAL

The executive is reimbursed for any eligible medical and/or dental expenses
which the executive or eligible dependents incur. There is no lifetime maximum
eligible for medical and dental expenses. Eligible expenditures are medical and
dental expenses, as covered by Section 213 of the Internal Revenue Code.

TAX IMPLICATION

The benefit is non-taxable.

ENROLLMENT

Executives will automatically be enrolled in Executive Medical and Dental Plan.
The executive is not eligible to participate in the Health Care Spending
Account.

Executives should submit all medical and/or dental bills to the insurance
carrier (see Contact List located in the Appendix).

ELIGIBLE DEPENDENTS

-  executive's spouse (including a legally separated but not a divorced
   spouse) and
-  unmarried children, stepchildren, or legally adopted children who reside
   with the executive and rely on the executive for support and who are:
   -  UNDER AGE 19 or
   -  OVER AGE 18 BUT YOUNGER THAN AGE 25 and registered as FULL-TIME STUDENT
      in an accredited secondary school, college, university or school of
      nursing.

COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION

If an executive is placed on Compensation Continuance/Salary & Benefit
Continuation, the executive may retain the Executive Medical and Dental benefit
during such period, even if the executive becomes employed by a new employer.

If the executive commences employment with another employer during Compensation
Continuance/Salary & Benefit Continuation, the coordination of benefits
provisions of the new employer's plan and the executive's medical and dental
plan will determine which plan provides primary coverage and which is secondary.
Benefits will be payable under the Executive Medical and Dental Plan only after
expenses have been considered by the new employer's plan.

                                       17
<PAGE>

                                CORE PERQUISITES
                                ----------------

BUSINESS TRAVEL ACCIDENT INSURANCE

The amount of special Business Travel Accident Insurance in the event of death
occurring while on Company business is equal to 2.5 TIMES CURRENT BASE SALARY UP
TO A LIMIT OF $1.5 MILLION. This coverage is in addition to the basic coverage
provided under the executive's Company-sponsored benefit program.

TAX IMPLICATION

This benefit is non-taxable.

ENROLLMENT

Executives will automatically be enrolled.

BENEFICIARY

This benefit will be paid to the beneficiary designated for SELECT Core Life
Insurance. If an executive wishes to designate a different beneficiary for
Business Travel Accident Insurance, a beneficiary form may be obtained from
Executive Compensation (see Contract list located in the Appendix).

COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION

If the executive is placed on Compensation Continuance/Salary & Benefit
Continuation, this coverage will no longer be applicable as it is contingent on
death while on Company business. Generally, individuals will not be asked to
travel on Company business during Compensation Continuance/Salary & Benefit
Continuation. Activities in search of new employment are not considered to be
"on Company business".

If you have any questions, please contact Risk Management (see Contact List
located in the Appendix).

                                       18
<PAGE>

                         ADDITIONAL FLEXIBLE PERQUISITE
                         ------------------------------

COMPANY-SPONSORED INSURANCE

There are three (3) Company-sponsored Insurance available for selection, as
follows:

- Executive Life Insurance
- Executive Personal Auto Insurance
- Executive Excess Liability Insurance

Enrollment will be effective January 1 of the Program year or on the date the
executive specifies on the enrollment form, except for life insurance coverage.
If an executive selects life insurance after January 1, evidence of insurability
may be required by the insurance carrier.

Upon enrollment, allowance representing the year's premium (full year or
prorata) will be deducted from the executive's flexible perquisite allowance. An
allowance adjustment will be made if the executive cancels such perquisite or if
there is a change in the amount of coverage.

Imputation of income will occur at year end. The amount imputed will equal the
allowance used.

                                       19
<PAGE>

EXECUTIVE LIFE INSURANCE

An executive may select Executive Life Insurance for two (2) times current base
salary. The executive's coverage is a universal life insurance plan provided by
Paragon Life Insurance Company up to a certain maximum and depending on certain
underwriting requirements.

ENROLLMENT/CANCELLATION

INITIAL ENROLLMENT - Upon employment or promotion to a Job Level eligible for
the Perquisite Program, the executive will receive a complete enrollment package
from Paragon. The enrollment package describes the Paragon program in detail.

ANNUAL RE-ENROLLMENT - Annually, executives with less than the maximum amount of
Paragon Insurance will receive a form asking if they want to increase coverage
or enroll in the Paragon program. If the executive does not want to make any
changes, no action is required. If the executive does want a change, the form
should be completed and sent to Executive Compensation. This is the annual
opportunity to apply for or increase coverage. Executives can decrease coverage
at any time.

Upon enrollment, the allowance representing the year's premium will be deducted
from the executive's flexible perquisite allowance. If there is a change in the
executive's base salary during the Program year, the insurance coverage will
change and an allowance adjustment will be effected. Policy coverage is
determined on executive's date of birth. An allowance adjustment will be made at
that time in the year.

If the executive requests cancellation and/or decrease coverage of this
insurance during the Program year, the executive must submit a Change Form to
Executive Compensation who will forward to Paragon Life Insurance Company. An
allowance adjustment will be effected the first of the month following notice of
cancellation and/or decrease of coverage.

The executive's income will be imputed at year end for the months coverage is in
effect.

A Service Request Form must be completed and mailed directly to Paragon Life
Insurance for purposes of changing a beneficiary, address change notification,
transfer of ownership, etc.

                                       20
<PAGE>

NOTE: IF AN EXECUTIVE, WHO HAS PREVIOUSLY ASSIGNED SUCH BENEFIT, HAS THE
OPPORTUNITY TO CONTINUE OR CHANGE SUCH BENEFIT, IT IS THE ASSIGNEE WHO MUST MAKE
THE CHOICE EVEN IF THE CHOICE IS "NO CHANGE."

THE ASSIGNEE MUST EXECUTE THE ENROLLMENT/BENEFICIARY AND CANCELLATION FORMS IF
SUCH INSURANCE HAS BEEN ASSIGNED.

CALCULATION

The monthly premium calculation is based on the executive's base salary times a
salary factor of two (2) times the Internal Revenue Code (IRC) Section 79
Monthly Income Factor Table I Rate "X" per $1,000 of insurance (see appendix for
Table I). A change in coverage may only occur on the first of the month.

The age-related premium is based on when the executive's birth date falls during
the year.

Example: The executive's base salary on the January 1 enrollment date is
$110,000 a year. The executive is 44 years old and will turn 45 and receives a
salary increase to $130,000 on March 1. The following is an example of the
Executive Life Insurance calculation:

<TABLE>

<CAPTION>

                           IRC Monthly                                                 Monthly           Period 1
                          Income Factor                                               Premium            Premium
                          Table I (Age)               $                Period        Allowance          Allowance
                          -------------               -                ------        ---------          ---------
<S>                      <C>                <C>                 <C>                <C>               <C>
PERIOD 1                      $.17               $220,000            Jan 1-Feb 28        $37.40             74.80

PERIOD 2                      $.29               $260,000            Mar 1-Dec 31        $75.40           $754.00

</TABLE>

COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION

If the executive is placed on Compensation Continuance/Salary & Benefit
Continuation, the executive may retain the Executive Life Insurance benefit
during such period. The Executive Life Insurance benefit calculation will be
based on the executive's last base salary prior to the commencement of
Compensation Continuance/Salary and Benefits Compensation. Since Paragon
insurance is portable, the executive can maintain his/her Paragon policy after
termination of employment. Paragon will bill the executive directly after
termination.

                                       21
<PAGE>

TO DETERMINE WHAT, IF ANY, COVERAGE IS TERMINATED UNDER THIS PROGRAM BECAUSE OF
COVERAGE BY A NEW EMPLOYER, THE TOTAL AMOUNT OF LIFE INSURANCE PROVIDED BY THE
NEW EMPLOYER ON A NON-CONTRIBUTORY BASIS IS COMPARED TO THE AMOUNT PROVIDED
UNDER THE EXECUTIVE LIFE INSURANCE PROGRAM. ANY DUPLICATE COVERAGE WILL OFFSET
DOLLAR FOR DOLLAR THE COVERAGE UNDER THE FLEXIBLE PERQUISITE PROGRAM.

SELECT CORE LIFE INSURANCE UNDER THE COMPANY-SPONSORED BENEFIT PROGRAM IS NOT
INCLUDED IN THIS COMPARISON. ALTHOUGH IT IS NON-CONTRIBUTORY, IT WILL NOT BE
CANCELED OR REDUCED DURING COMPENSATION CONTINUANCE/SALARY & BENEFIT
CONTINUATION. THE OFFSETS FOR LIFE INSURANCE WILL BE MADE ONCE WHEN THE
EXECUTIVE COMMENCES EMPLOYMENT WITH A NEW EMPLOYER; NO ADJUSTMENTS WILL BE MADE
FOR SALARY INCREASES IN THE NEW JOB.

All enrollment and cancellation forms should be submitted directly to Executive
Compensation (see Contact List located in the Appendix).

                                       22
<PAGE>

                               FLEXIBLE PERQUISITE
                               -------------------

COMPANY-SPONSORED INSURANCE

EXECUTIVE PERSONAL AUTO INSURANCE  (Premium = $150 or $978 per vehicle annually)

Executive Personal Auto Insurance provides eligible executives with Automobile
Liability and Physical Damage insurance on his/her personal automobiles. This
coverage applies to vehicle(s) registered in the executive's name, in an
eligible dependent's name or held jointly with an eligible dependent. Vehicle(s)
may be driven by the executive and/or their eligible dependents.

ELIGIBLE DEPENDENTS

-  executive's spouse (including a legally separated but not a divorced
   spouse) and
-  unmarried children, stepchildren, or legally adopted children who reside
   with the executive and rely on the executive for support and who are:
   -  UNDER AGE 19 or
   -  OVER AGE 18 BUT YOUNGER THAN AGE 25 and registered as FULL-TIME STUDENT
      in an accredited secondary school, college, university or school of
      nursing.

The Program provides a primary automobile liability insurance limit of
$1,000,000 for Bodily Injury and Property Damage Liability. Additional coverage
of up to $10,000,000 for Bodily Injury and Property Damage Liability is
available under the Executive Excess Liability Insurance Program. Accordingly, a
total limit of $11,000,000 bodily injury/property damage liability is available
under the combined programs. The primary liability policy also includes:

<TABLE>

                       <S>                         <C>
                           Medical Payments          $  10,000
                           Uninsured Motorist         $250,000

</TABLE>

The Physical Damage coverage includes Comprehensive (such as fire and theft) and
Collision insurance. A comprehensive and/or collision deductible is $250 per
occurrence.

If an executive gives VERBAL approval to a licensed driver who is a TEMPORARY
VISITOR for OCCASIONAL use (1 or 2 times per year) of such a car, auto insurance
coverage will continue to be effective on such insured car. Additionally, any
household employee, including a Nanny or Au pair, is covered under the Executive
Personal Auto Insurance Program, however, they must have a U.S. driver's
license.

The Executive Personal Auto Insurance Program has a standard "business pursuits"
clause which excludes coverage for any liability arising from business activity.
Employment-related activity on behalf of the Company is covered under separate
Company-maintained insurance coverages. Any non-Company related business
activity should be covered by the executive under separate insurance placement.

                                       23
<PAGE>

ENROLLMENT/CANCELLATION

To enroll, an Executive Personal Auto Insurance Application form should be
completed and sent to Executive Compensation (see Contact List located in the
Appendix). Enrollment will be effective January 1 or the date the executive
specifies on the Application form. Upon enrollment, the allowance representing
the year's premium (full year or prorata) will be deducted. Deductions will be
based on the FMV cost of such insurance Program, as determined by Risk
Management in concert with Executive Compensation. Each executive may enroll up
to three (3) personal cars under the Executive Personal Auto Insurance at the
Company cost of the benefit. Additional automobiles may be insured, however, at
the FMV of such insurance program.

If the executive requests cancellation of this insurance during the Program
year, the executive must submit an Executive Personal Auto Insurance
Cancellation form which provides written notification of cancellation to
Executive Compensation. An allowance adjustment will be effected following
Executive Compensation's receipt of such written notice of cancellation.

If the executive RETIRES, the executive may remain in the Personal Auto
Insurance Program for three (3) months from such date unless the executive was
on Salary & Benefit Continuation immediately prior to retirement. However, if
the three (3) months of insurance coverage extends into the next Program year, a
check for the full-year premium or prorata amount will be requested, and the
variance between the FMV and the actual cost will be reported for tax purposes
as additional income. Risk Management should be contacted to obtain such
coverage (see Contact List located in the Appendix).

IMPUTED INCOME

The Company designated Personal Auto Insurance cost (full or prorata) will be
deducted from the perquisite allowance.

The executive's income will be imputed based on the Personal Auto Insurance FMV
of the benefit to the executive at year end. The variance will be prorated if
the personal auto is not covered for a full year.

COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION

If the executive is placed on Compensation Continuance/Salary & Benefit
Continuation, the executive may retain the Executive Personal Auto Insurance
benefit during such period. To the extent coverage is provided by a new
employer, such employer-provided coverage will be considered primary and the
Company coverage as excess. Specific coverage determination may be obtained from
Risk Management. Questions should be directed to Risk Management (see Contact
List located in the Appendix). However, all enrollment and cancellation forms
should be submitted directly to Executive Compensation (see Contact List located
in the Appendix).

                                       24
<PAGE>

                               FLEXIBLE PERQUISITE
                               -------------------

COMPANY-SPONSORED INSURANCE

EXECUTIVE EXCESS LIABILITY INSURANCE (Premium = $225 per $1,000,000 coverage
annually)

Executive Excess Liability Insurance provides to each eligible executive Excess
Liability Insurance coverage with a combined limit of $10,000,000 bodily injury
and property damage liability for each occurrence/annual aggregate for personal
and automobile liability. Eligible executives may purchase such insurance in
increments of $1,000,000 up to a maximum limit of $10,000,000.

This insurance provides coverage above a limit of $1,000,000 bodily injury and
property damage for automobile liability on personal automobiles that are
eligible for coverage under the Executive Personal Auto Insurance Program. The
combined programs provide a maximum coverage limit of $11,000,000 bodily
injury/property damage for automobile liability insurance.

If an eligible executive does not elect Executive Automobile Insurance, the
executive is still eligible for the $10,000,000 Excess Liability Insurance
Coverage provided the EXECUTIVE MAINTAINS A MINIMUM LIMIT OF $1,000,000 UNDER
THE EXECUTIVE'S OWN PRIMARY AUTO POLICY. Risk Management must be notified of
such coverage on the enrollment form.

Each eligible executive SHOULD MAINTAIN A LIMIT OF AT LEAST $500,000 PERSONAL
LIABILITY (BODILY INJURY/PROPERTY DAMAGE) UNDER HIS/HER PERSONAL HOMEOWNER OR
TENANT LIABILITY INSURANCE POLICY. Executives employing domestics should
maintain Workers' Compensation with statutory limits and Employer's Liability
Coverage of $500,000 either under his/her homeowner or separate workers'
compensation policy. If the executive does not carry the $500,000 limit under an
insurance policy, the executive will be responsible for the first $500,000 in
the event of an accident.

The Executive Excess Liability Insurance Program then provides an additional
limit of $10,000,000 bodily injury/property damage for personal liability.
Excess coverage is also provided within the $10,000,000 liability limit on
pleasure-use watercraft, not more than 50 feet in length, subject to an
underlying bodily injury and property damage liability insurance limit of
$500,000 maintained by the covered executive.

The Executive Excess Liability Insurance Program has a standard "business
pursuits" clause which excludes coverage for any liability arising from business
activity. Employment-related activity on behalf of the Company is covered under
separate Company-maintained insurance coverages. Any non-Company related
business activity should be covered by the executive under separate insurance
placement.

                                       25
<PAGE>

<TABLE>

<S>           <C>
Boats:         No limits on number of boats. To be covered under Excess
               Liability insurance, the boat(s) must be covered under the
               executive's homeowner's policy or yacht insurance.

Snowmobiles:   No limit on the number of snowmobiles. However, they must be
               covered under homeowner's policy for at least the minimum
               personal liability limit of $500,000 (personal injury/property
               damage) in order to qualify for Excess Liability Insurance
               coverage.

Motorcycles:   Not covered.

Airplanes:     Not covered.

Jet Skis:      Not covered

</TABLE>

ENROLLMENT/CANCELLATION

To enroll, an Executive Excess Liability Insurance Enrollment form should be
completed and sent to Executive Compensation (see Contact List located in the
Appendix). Enrollment will be effective January 1 of the Program year or the
date the executive specifies on the Enrollment form. Upon enrollment, the
allowance representing the year's premium (full year or prorata) will be
deducted. Deductions will be based on the FMV cost of such insurance program, as
determined by Risk Management. The executive's income will be imputed at year
end.

If the executive requests cancellation of this insurance during the Program
year, the executive must submit an Executive Excess Liability Insurance
Cancellation form which provides written notification of cancellation to
Executive Compensation. An allowance adjustment will be effected following
Executive Compensation's receipt of such written notice of cancellation.

If the executive RETIRES, the executive may remain in the Excess Liability
Insurance Program for three (3) months from such date unless the executive was
on Salary & Benefit Continuation prior to retirement. However, if the three (3)
months of insurance coverage extends into the next Program year, a check for the
full-year premium or prorata amount will be requested. Risk Management should be
contacted to obtain such coverage (see Contact List located in the Appendix).

                                       26
<PAGE>

COMPENSATION CONTINUANCE/SALARY & BENEFIT CONTINUATION

If the executive is placed on Compensation Continuance/Salary & Benefit
Continuation, the executive may retain the Executive Excess Liability Insurance
benefit during such period. To the extent coverage is provided by a new
employer, such employer-provided coverage will be considered primary and the
Company coverage as excess. Specific coverage determination will be obtained
from Risk Management.

Questions should be directed to Risk Management (see Contact List located in the
Appendix). However, all enrollment and cancellation forms should be submitted
directly to Executive Compensation (see Contact List located in the Appendix).

                                     27<PAGE>
                                                                   EXHIBIT 10.26

                          PDS FINANCIAL CORPORATION
                          DEFERRED COMPENSATION PLAN

                           Adopted February 4, 2000
                                   ----------
                       but first Effective April 1, 2000
                                           -------

<PAGE>

                          PDS FINANCIAL CORPORATION
                          DEFERRED COMPENSATION PLAN

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>

                                                                           PAGE
<S>           <C>             <C>                                          <C>
ARTICLE I.    PURPOSE AND INTENT ........................................... 1
              Section 1.1     Purpose
              Section 1.2     Intent

ARTICLE II.   DEFINITIONS .................................................. 1

              Section 2.1     Definitions
              Section 2.2     Rules of Interpretation

ARTICLE III.  ELIGIBILITY AND PARTICIPATION ................................ 5

              Section 3.1     Eligibility
              Section 3.2     Participation
              Section 3.3     Suspension of Eligibility
              Section 3.4     Specific Exclusion

ARTICLE IV.   CREDITS TO ACCOUNTS .......................................... 6

              Section 4.1     Deferred Compensation
              Section 4.2     Deferral Elections of Eligible Compensation
              Section 4.3     Effectiveness of Deferral Election
              Section 4.4     Deferral Elections of Bonus Awards
              Section 4.5     Discretionary Amounts
              Section 4.6     Participant Accounts

ARTICLE V.    VALUATION OF ACCOUNTS ........................................ 8

              Section 5.1     Establishment of Accounts
              Section 5.2     Adjustments of Accounts
              Section 5.3     Hypothetical Accounts
</TABLE>

                                      -i-

<PAGE>

<TABLE>

<S>           <C>             <C>                                          <C>
ARTICLE VI.   VESTING OF ACCOUNT ........................................... 9

              Section 6.1     Vested Benefit
              Section 6.2     Forfeiture on Account of Termination for Cause
              Section 6.3     Limitation on Benefits

ARTICLE VII.  DISTRIBUTIONS ............................................... 10

              Section 7.1     Distribution of Benefits
              Section 7.2     Form of Distribution
              Section 7.3     Payment to Beneficiary
              Section 7.4     Change in Control Distributions
              Section 7.5     Hardship Withdrawals
              Section 7.6     Designation of Beneficiaries
              Section 7.7     Death Prior to Full Distribution
              Section 7.8     Facility of Payment
              Section 7.9     Form of Distribution
              Section 7.10    Distributions As a Result of Tax Determination
              Section 7.11    No Parachute Payment

ARTICLE VIII. FUNDING OF PLAN ............................................. 17

              Section 8.1     Unfunded and Unsecured Plan
              Section 8.2     Corporate Obligation

ARTICLE IX.   AMENDMENT AND TERMINATION ................................... 18

              Section 9.1     Amendment and Termination
              Section 9.2     No Oral Amendments
              Section 9.3     Plan Binding on Successors

ARTICLE X.     DETERMINATIONS -- RULES AND REGULATIONS .................... 20

              Section 10.1    Determinations
              Section 10.2    Rules and Regulations
              Section 10.3    Method and Executing Instruments
              Section 10.4    Claims Procedure
              Section 10.5    Limitations and Exhaustion

ARTICLE XI.   PLAN ADMINISTRATION ......................................... 24

              Section 11.1    Officers
              Section 11.2    Chief Executive Officer
</TABLE>

                                      -ii-

<PAGE>

<TABLE>

<S>           <C>             <C>
              Section 11.3    Board of Directors
              Section 11.4    Committee
              Section 11.5    Delegation
              Section 11.6    Conflict of Interest
              Section 11.7    Administrator
              Section 11.8    Service of Process
              Section 11.9    Expenses
              Section 11.10   Spendthrift Provision
              Section 11.11   Tax Withholding
              Section 11.12   Certifications
              Section 11.13   Errors in Computations
              Section 11.14   No Employment Rights
              Section 11.15   Participants Should Consult Advisors

ARTICLE XII.  CONSTRUCTION ................................................ 27

              Section 12.1    Applicable Laws
              Section 12.2    Effect on Other Plans
              Section 12.3    Disqualification
              Section 12.4    Rules of Document Construction
              Section 12.5    Choice of Law
              Section 12.6    No Employment Contract

</TABLE>

                                     -iii-

<PAGE>

                        PDS FINANCIAL CORPORATION
                        DEFERRED COMPENSATION PLAN

                                ARTICLE I
                            PURPOSE AND INTENT

    Section 1.1 PURPOSE. PDS Financial Corporation, a Minnesota corporation
doing business in Nevada, hereby establishes the PDS Financial Corporation
Deferred Compensation Plan, effective as of April 1, 2000, in order to
provide financial incentives to certain key employees of PDS Financial
Corporation to encourage their commitment to employment with PDS Financial
Corporation and the success of PDS Financial Corporation. The purpose of the
PDS Financial Corporation Deferred Compensation Plan is to assist PDS
Financial Corporation in retaining certain key employees, encouraging their
commitment to the success of PDS Financial Corporation, and attracting key
employees by offering them and opportuniy to defer compensation and
participate in the success of PDS Financial Corporation.

    Section 1.2 INTENT. The PDS Financial Corporation Deferred Compensation
Plan is intended to be a plan which is unfunded and is maintained by PDS
Financial Corporation primarily for the purpose of providing deferred
compensation for a select group of management or highly compensated employees
and shall be interpreted and construed in a manner consistent with that
intent.

                                ARTICLE II
                               DEFINITIONS

    Section 2.1 DEFINITIONS. As used in this document with initial capital
letters, the following terms shall have the meanings indicated unless a
different meaning is plainly required by the context:

    (a)     ACCOUNT - the separate bookkeeping account representing the
            separate unfunded and unsecured general obligation of PDS
            established with respect to each person who is a Participant in
            this Plan in accordance with Article III and to which is credited
            the amounts specified in Article IV and Article V and from which
            are subtracted forfeitures and payments made pursuant to Article
            VI and Article VII.

    (b)     AFFILIATE - a business entity which is affiliated in ownership
            with PDS or an Employer and is recognized as an Affiliate by the
            Committee for purpose of this Plan.

    (c)     ANNUAL VALUATION DATE - the last day of each calendar year.

<PAGE>

    (d)     BENEFICIARY - a person or persons designated by a Participant (or
            automatically by operation of the Plan Statement) to receive all
            or a part of any benefits payable on behalf of the Participant
            under the terms of the Plan after the Participant's death. The
            person or persons so designated shall not be considered a
            Beneficiary until the death of the Participant.

    (e)     BOARD OF DIRECTORS - the Board of Directors of PDS or its
            successor. "Board of Directors" shall also mean and refer to any
            properly authorized committee of the Board of Directors.

    (f)     BONUS AWARDS - shall mean the bonus awards, if any, made by an
            Employer for a fiscal year based upon the performance of the
            Employer or the employees eligible for such awards and the
            performance and profits of the Employer.

    (g)     CHANGE IN CONTROL - shall mean the occurrence of any of the
            following:

            (i)   The acquisition by any person, entity or "group," within the
                  meaning of Section 13(d)(3) or Section 14(d)(2) of the
                  Securities Exchange Act of 1934 (excluding for this
                  purpose, any employee benefit plan of PDS or any of its
                  "subsidiaries" which acquires beneficial ownership of
                  voting securities of PDS) of beneficial ownership (within
                  the meaning of Rule 13d-3 under the Securities Exchange Act
                  of 1934) of 50% or more of either the then outstanding
                  shares of stock or the combined voting power of then
                  outstanding voting securities of PDS, in one transaction or
                  a series of transactions; or

            (ii)  Individuals who, as of July 31, 1999, constituted the Board
                  of Directors (the "Continuing Directors") cease for any
                  reason to constitute at least a majority of the Board of
                  Directors, provide that any person becoming a director of
                  PDS subsequent to July 31, 1999, whose election, or
                  nomination for election by the stockholders of PDS, was
                  approved by a vote of at least a majority of the Continuing
                  Directors (other than an election or nomination of an
                  individual whose initial assumption of office is in
                  connection with an actual or threatened solicitation with
                  respect to the election or removal of directors of PDS, as
                  such terms are used in Rule 14a-11 of Regulation 14a under
                  the Securities Exchange Act to of 1934) shall be, for
                  purposes of the Plan, considered as though such person were
                  a Continuing Directors; or

            (iii) (i) the occurrence of a merger, consolidation or
                  reorganization of PDS in which, as a consequence of the
                  transaction, either the Continuing

                                      -2-

<PAGE>

                  Directors do not constitute a majority of the directors of
                  the continuing of surviving corporation or any person,
                  entity or "group," within the meaning of Section 13(d)(3)
                  or Section 14(d)(2) of the Securities Exchange Act to of
                  1934, controls 50% or more of the combined voting power of
                  the continuing or surviving corporation; (ii) the
                  occurrence of any sale, lease or other transfer, in one
                  transaction or a series of transaction, of all or
                  substantially all of the assets of PDS (at least 80%); or
                  (iii) the adoption by PDS of a plan for its liquidation or
                  dissolution.

            (iv)  For purposes of this definition of "Change of Control," the
                  term "subsidiary" shall mean any corporation, the majority
                  of the outstanding voting stock of which is owned, directly
                  or indirectly, by PDS.

    (h)     CODE - the Internal Revenue Code of 1986, any amendments thereto,
            and any regulations or rulings issued thereunder.

    (i)     COMMITTEE - the Compensation Committee of the Board of Directors
            described under Section 11.4 of the Plan.

    (j)     EFFECTIVE DATE - April 1, 2000.

    (k)     ELIGIBLE COMPENSATION - the compensation subject to federal
            income tax withholding as described in section 1.415-2(d)(11)(ii)
            of the Treasury Regulations; except, however, that Eligible
            Compensation shall not include the Bonus Awards as defined in
            subsection (f) of this Section 2.1 of the Plan, but shall include
            any elective deferral as defined in section 402(g)(3) of the Code
            and any amount which is contributed or deferred by an Employer at
            the election of the eligible employee and which is not includable
            in the gross income of the eligible employee by reason of section
            125 of the Code or section 457 of the Code.

    (l)     EMPLOYERS - PDS and any business entity affiliated with PDS that
            employs persons who are designated for participation in this Plan.

    (m)     ERISA - the Employee Retirement Income Security Act of 1974, any
            amendments thereto, and any regulations or ruling s issued
            thereunder.

    (n)     PARTICIPANT - an employee of an Employer who is determined to be
            eligible to participate in this Plan, who becomes a Participant
            in this Plan in accordance with the provisions under Article III,
            whose Account has been credited with amounts in accordance with
            the terms of the Plan, and who has

                                      -3-

<PAGE>

            not received the entire benefit payable to the Participant under
            the terms of the Plan. An employee who has become a Participant
            shall be considered to continue as a Participant in this Plan
            until the date of the Participant's death or, if earlier, the
            date when the Participant is no longer employed by an Employer or
            an Affiliate and no amount is credited to the Participant's
            Account under this Plan.

    (o)     PDS - PDS FINANCIAL CORPORATION, a Minnesota corporation, or any
            successor thereto.

    (p)     PLAN - the nonqualified, supplemental retirement program
            maintained by PDS for the benefit of Participants eligible to
            participate therin, as set forth in the Plan Statement. (As used
            herein, "Plan" does not refer to the document pursuant to which
            this Plan is maintained. That document is referred to herein as
            the "Plan Statement.") The Plan shall be referred to as the "PDS
            Financial Corporation Deferred Compensation Plan."

    (q)     PLAN STATEMENT - this document entitled "PDS Financial
            Corporation Deferred Compensation Plan" as adopted by the Board
            of Directors of PDS effective as of April 1, 2000, as the same
            may be amended from time to time thereafter.

    (r)     PLAN YEAR - the twelve (12) consecutive month period that begins
            on January 1 and ends on December 31; the first Plan Year shall
            commence January 1, 2000, and end December 31, 2000.

    (s)     TERMINATION OF EMPLOYMENT - a complete severance of an employee's
            employment relationship with the Employers and all Affiliates, if
            any, for any reason other than the employee's death. A transfer
            from employment with an Employer to employment with an Affiliate
            of an Employer shall not constitute a Termination of Employment.
            If an Employer who is an Affiliate ceases to be an Affiliate
            because of a sale of substantially all the stock or assets of the
            Employer, then Participants who are employed by that Employer and
            who cease to be employed by PDS or an employer on account of the
            sale of substantially all the stock or assets of the Employer
            shall be deemed to have thereby had a Termination of Employment
            for the purpose of commencing distributions from this Plan.

    (t)     VALUATION DATE - the Annual Valuation Date and March 31, June 30
            and September 30, and any other date designated by the Committee.

    (u)     VESTED -  the terms shall only apply for purposes of determining
            the benefit payable to or with respect to any Participant under
            the terms of the Plan, and

                                     -4-

<PAGE>

                  shall be interpreted to mean a Participant's interest in
                  the benefit described under the Plan which may be payable
                  to or on behalf of the Participant in accordance with and
                  subject to the terms of the Plan.

         Section 2.2 RULES OF INTERPRETATION. Any reference in the Plan to a
statute or regulation shall be considered also to mean and refer to any
subsequent amendment or replacement of that statute or regulation.

                                  ARTICLE III

                         ELIGIBILITY AND PARTICIPATION

         Section 3.1 ELIGIBILITY. Subject to the approval of the Board of
Directors, each employee of PDS who is an officer of PDS as of the Effective
Date shall be eligible to participate in the Plan effective as of the
Effective Date. In addition, the Board of Directors in its sole discretion
may by express to participate in this Plan for a particular Plan Year. If the
Board of Directors selects a management level or highly compensated employee
of an Employer as eligible to become a Participant in the Plan, the Board of
Directors shall inform the employee in writing of such selection and the date
on which the employee shall become a Participant in the Plan. The Board of
Directors shall not select any employee for participation unless the Board of
Directors determines that such employee is a member of a "select group of
management or highly compensated employees" (as that phrase is used in
sections 201(2), 301(a)(3), and 401(a)(1) of ERISA).

         Section 3.2 PARTICIPATION. Each officer of PDS determined to be
eligible to participate in the Plan as of the Effective Date pursuant to
Section 3.1 shall be a Participant in the Plan as of the Effective Date. Any
management level or highly compensated employee who is or becomes eligible to
participate in the Plan under Section 3.1 and who is not a Participant in the
Plan as of the Effective Date, shall become a Participant in the Plan as of
the first day of a Plan Year determined by the Board of Directors or on such
other date as determined by the Board of Directors. The name of each
individual eligible to participate in the Plan and the date which such
individual becomes a Participant in this Plan shall be recorded on Exhibit A,
which exhibit is attached hereto and incorporated herein by reference and
which shall be revised by the Board of Directors from time to time to reflect
the operation of the Plan. Once an individual becomes a Participant in the
Plan, the  individual shall remain a Participant until his or her death or,
if earlier, the date when the Participant is no longer employed by an
Employer or an Affiliate and the benefits which may be payable  to the
Participant under the Plan have been distributed to or on behalf of the
individual.

         Section 3.3 SUSPENSION OF ELIGIBILITY. Notwithstanding any provision
in the Plan Statement to the contrary, the Board of Directors may in its
discretion determine that a Participant is no longer eligible to be credited
with any amounts under Article IV of the Plan and in such event, the deferral
elections of such Participant will immediately terminate and no additional
amounts shall be credited to his or her Account under Article IV until such
time as the Participant is again

                                     -5-
<PAGE>

determined to be eligible to have amounts credited to his or her Account
under Article IV by the Board of Directors. However, the individual's Account
shall continue to be adjusted in accordance with the provisions of Article V
of this Plan.

         Section 3.4 SPECIFIC EXCLUSION. Notwithstanding anything apparently
to the contrary in the Plan Statement or in any written communication,
summary, resolution or document or oral communication, no individual shall be
a Participant in this Plan, develop benefits under this Plan or be entitled
to receive benefits under this Plan (either for himself or herself or his or
her survivors) unless such individual is a member of a "select group of
management or highly compensated employees" (as that phrase is used in
sections 201(2), 301(a)(3), and 401)(a)(1) of ERISA). If a court of competent
jurisdiction, any representative of the U.S. Department of Labor or any other
governmental, regulatory or similar body makes any direct or indirect, formal
or informal, determination than an individual is not a member of a "select
group of management or highly compensated employees" (as that phrase is used
in sections 201(2), 301(a)(3), and 401(a)(1) of ERISA), such individual shall
not be (and shall not have ever been) a Participant in this Plan at anytime.
If any person not so defined has been erroneously treated as a Participant in
this Plan, upon discovery of such error such person's erroneous participation
shall immediately terminate AB INITIO and the individual's Account shall be
forfeited immediately and such person shall be obligated to reimburse PDS for
all amounts erroneously paid to him or her.

                                   ARTICLE IV

                              CREDITS TO ACCOUNTS

         Section 4.1 DEFERRED COMPENSATION. A Participant may elect to defer
receipt of part or all of either of the following items of compensation:

         (a)         Eligible Compensation;

         (b)         Bonus Awards.

A Participant may defer an item of compensation only to the extent that the
Participant is entitled to receive such item of compensation. In the event a
deferral election is made by a Participant which is accepted and approved by
the Committee, the Participant will have  no further right to such deferred
compensation other than as provided under the Plan. Such deferred
compensation shall be the record of the value of such deferred compensation
credited to a Participant's Account and shall be used solely for accounting
purposes.

         Section 4.2 DEFERRAL ELECTIONS OF ELIGIBLE COMPENSATION.

         (a)         DEFERRAL ELECTION OF ELIGIBLE COMPENSATION. Each year a
                     Participant may elect to defer all or any portion of the
                     Eligible Compensation that would other wise become payable
                     to the Participant during the following calendar

                                      -6-

<PAGE>

                     year. An election by a Participant to defer such
                     Eligible Compensation must be made by the Participant in
                     the form and manner prescribed by the Committee and must
                     be filed with and accepted and approved by the Committee
                     before January 1 of the year for which the Eligible
                     Compensation is payable, specifying the portion of the
                     Eligible Compensation to be earned in the succeeding
                     calendar year that is to be deferred.

         (b)         DEFERRAL ELECTION FOR FIRST YEAR. In the first year in
                     which a Participant becomes eligible to participate in
                     the Plan, the newly eligible Participant may make an
                     election to defer Eligible Compensation for services to
                     be performed subsequent to the election within thirty
                     (30) days after the date the employee becomes eligible.
                     This subsection (b) shall only apply, however, with
                     respect to an eligible Participant who becomes a
                     Participant in the Plan on a date other than the first
                     day of a Plan Year.

         (c)         DEFERRAL ELECTION FOR FIRST YEAR OF THE PLAN. In the
                     year in which the Plan is first implemented, an eligible
                     Participant may make an election to defer Eligible
                     Compensation for services to be performed subsequent to
                     the deferral election within thirty(30) days after the date
                     the Plan is effective for eligible employees.

         Section 4.3 EFFECTIVENESS OF DEFERRAL ELECTION. An election by a
Participant to defer a portion of his or her Eligible Compensation pursuant
to Section 4.2 must be made by the Participant before the beginning of the
period of service for which the Eligible Compensation is payable and the
amounts so deferred shall be paid only as provided in this Plan. Such an
election shall be irrevocable. When a Participant's Account is credited with
a deferred amount, that amount shall be measured in U.S. dollars equal to
such deferred amount and shall be credited to an Account established for the
Participant as of the close of business on the date that such amount would
have otherwise been paid to the Participant. The Participant may change the
amount of, or suspend, future deferrals with respect to Eligible Compensation
otherwise payable to him or her for calendar years beginning after the date
of change suspension as he or she may specify by written notice to the
Committee. If a Participant elects to change the amount of, or suspend,
deferrals, the Participant may make a new deferral election provided that any
new election to defer payment of Eligible Compensation must be made before
the beginning of the period of service for which the Eligible Compensation is
payable. The election to defer shall be irrevocable as to the deferred
Eligible Compensation for the period for which the election is made and shall
not be effective unless accepted and approved by the Committee. The period of
deferral and form of distribution of Eligible Compensation shall be
determined in accordance with the elections made under Section 4.2 and this
Section 4.3 and in accordance with the provisions of this Plan.

         Section 4.4 DEFERRAL ELECTIONS OF BONUS AWARDS. In addition to
amounts deferred by a Participant pursuant to Sections 4.2 and 4.3, each year
a Participant may elect to defer all or a

                                     -7-
<PAGE>

portion of any Bonus Award that would otherwise be payable to the
Participant. An election by a Participant to defer all or a portion of a
Bonus Award that would otherwise be payable to the Participant must be made
before the beginning of the period of service for which the Bonus Award is
payable and at least twelve (12) months prior to the date on which such Bonus
Award would otherwise become payable. Such a deferral election shall be
irrevocable and must be made in the form and manner prescribed by the
Committee and must be filed with and accepted and approved by the Committee.
The period of deferral and form of distribution of a Bonus Award shall be
determined in accordance with the elections made under this Section 4.4 and in
accordance with the provisions of this Plan.

         Section 4.5  DISCRETIONARY AMOUNTS.  In addition to any amounts
which may be credited to the Account of a Participant pursuant to Sections
4.2, 4.3 and 4.4 for any year, the Committee may from time to time, in its
sole discretion, credit the Participant's Account with additional amounts.
Such additional amounts shall be authorized for such purpose or purposes as
the Committee may deem appropriate. Any such additional amounts shall be
credited to the Account of a Participant as of the Valuation Date coincident
with or next following the Committee's determination. Once the Committee
determines that additional amounts shall be credited to a Participant's
Account pursuant to this Section 4.5, the Committee shall provide written
notice to the Participant that additional amounts shall be credited to the
Participant's Account and shall specify the date on which such amounts shall
be credited to the Account.

         Section  4.6  PARTICIPANT ACCOUNTS.  An Account shall be established
and maintained for each Participant. The Account shall be credited with
amounts which shall be measured in U.S. dollars. The Account shall be
credited as described in Article V for deferred amounts attributable to
(a) Eligible Compensation as may be credited to the Account under Section 4.2
and Section 4.3, (b) Bonus Awards as may be credited to the Account under
Section 4.4, and (c) discretionary amounts as may be credited to the Account
under Section 4.5.

                                  ARTICLE V

                            VALUATION OF ACCOUNTS

         Section 5.1  ESTABLISHMENT OF ACCOUNTS.  There shall be established
for each Participant an unfunded, bookkeeping Account which shall be adjusted
each Valuation Date.

         Section 5.2  ADJUSTMENTS OF ACCOUNTS.  As of each Valuation Date
(the "current Valuation Date"), the value of the amount credited to each
Account determined as of the immediately preceding Valuation Date (the
"previous Account value") shall be increased (or decreased) by the following
adjustments made in the following sequence:

         (a)          INTERMEDIATE DISTRIBUTION SUBTRACTION.  The previous
                      Account value shall be reduced by the total amount
                      distributed to or with respect to the Participant, or
                      forfeited pursuant to Section 6.2, from such Account as
                      of a

                                      -8-

<PAGE>

                      date subsequent to the immediately preceding Valuation
                      Date put prior to the current Valuation Date.

         (b)          DEFERRAL AMOUNTS.  The previous Account value (as
                      adjusted above) shall be increased by the amounts
                      deferred, if any, pursuant to Article IV of the Plan.

         (c)          INVESTMENT ADJUSTMENT.  The previous Account value (as
                      adjusted above) shall be increased to reflect an
                      additional amount, which shall be credited to each
                      Participant's Account as of the close of the last day
                      of each calendar quarter, equal to the average cost of
                      long term funds for PDS for the calendar year ending
                      prior to the calendar year in which occurs the calendar
                      quarter for which this adjustment is to be made. This
                      average cost will be calculated as follows: the
                      interest expense shall be divided by the monthly
                      average outstanding interest bearing obligations of
                      PDS. However, the Committee specifically reserves the
                      authority and right to amend, alter or wholly revise
                      this rate of adjustment and to adopt another adjustment
                      factor or interest rate as the Committee may designate
                      from time to time, provided that notice is given to
                      Participants of such other factor or interest rate
                      prior to the effective date on which such factor rate
                      is to apply.

         (d)          FINAL DISTRIBUTION SUBTRACTION.  The previous Account
                      value (as adjusted above) shall be reduced by the total
                      amount distributed to or with respect to the
                      Participant, or forfeited pursuant to Section 6.2, from
                      such Account as of the current Valuation Date.

         Section 5.3  HYPOTHETICAL ACCOUNTS.  The Accounts established under
this Plan shall be hypothetical in nature and shall be maintained for
bookkeeping purposes only. Neither the Plan nor any of the Accounts (or
sub-accounts) shall hold or be required to hold any actual funds or assets.

                                  ARTICLE VI

                              VESTING OF ACCOUNT

         Section 6.1  VESTED BENEFIT.  Subject to Section 6.2 and except as
elsewhere specifically provided, the amounts credited to the Account of each
Participant shall be one hundred percent (100%) Vested at all times.

         Section 6.2  FORFEITURE ON ACCOUNT OF TERMINATION FOR CAUSE.
Notwithstanding Section 6.1 hereof, a Participant shall not be Vested in any
amounts in any amounts credited to his or her Account under the Plan and any
such amounts so credited to that Account shall be forfeited and the
Participant shall have no claim to any such amounts so credited to that
Account in the event of the Participant's involuntary "Termination of
Employment for cause" as determined by the Committee,

                                      -9-

<PAGE>

which determination shall be made in its sole and absolute discretion. For
purposes of this Section 6.2, "Termination of Employment for cause" means
termination based upon any of the following:

         (a)          the willful and continued failure by the Participant to
                      substantially perform Participant's duties with the
                      Employers (other than any such failure resulting from
                      Participant's incapacity due to physical or mental
                      illness) after a written demand for substantial
                      performance is delivered to the Participant
                      specifically identifying the manner in which the
                      Participant has not substantially performed the
                      Participant's duties;

         (b)          the engaging by the Participant in willful misconduct
                      which is demonstrably injurious to any one or more of
                      the Employers monetarily or otherwise;

         (c)          the conviction of the Participant of a felony; or

         (d)          any act or failure to act described in any employment
                      agreement the Participant has entered into with any one
                      or more of the Employers.

         Section 6.3  LIMITATION ON BENEFITS.  The benefits that may be
payable to or on behalf of a Participant under the Plan shall not exceed a
cash payment equal to the value of the Vested amounts credited to the
Participant's Account under Article IV and any amounts credited to that
Account under Article V.

                                   ARTICLE VII

                                  DISTRIBUTIONS

         Section 7.1  DISTRIBUTION OF BENEFITS.  In the event a Participant
becomes eligible to receive any benefits under the Plan, such benefits
payable to or on behalf of a Participant under the Plan shall be
distributable in accordance with this Section 7.1.

         (a)          DISTRIBUTION OF BENEFITS.  Distribution of
                      Participant's Vested Plan benefits shall be made (or,
                      in the case of installments, shall commence) as soon as
                      practicable after the Valuation Date immediately
                      following the earliest to occur of any of the following
                      events while in the employment of an Employer or an
                      Affiliate:

                      (i)   the Participant's death;

                      (ii)  subject to Section 6.2, the Participant's
                            Termination of Employment; or

                                     -10-

<PAGE>

                      (iii)  the termination of this Plan.

         (b)          AMOUNT OF DISTRIBUTABLE BENEFITS.  The benefits that
                      are distributable to or on behalf of a Participant
                      under the Plan shall not exceed the value of the Vested
                      amounts credited to the Participant's Account pursuant
                      to Articles IV and V (reduced by the amounts of any
                      applicable payroll, withholding and other taxes.)

         (c)          APPLICATION FOR DISTRIBUTION.  A Participant shall not
                      be required to make application to receive payment.
                      Distribution shall not be made to any Beneficiary,
                      however, until such Beneficiary shall have filed a
                      written application for benefits in a form acceptable
                      to the Committee and such application shall have been
                      approved by the Committee.

         (d)          CODE SECTION 162(m) DELAY.  If the Committee determines
                      that delaying the time the initial payments are made or
                      commenced would increase the probability that such
                      payments would be fully deductible for federal or state
                      income tax purposes, PDS may unilaterally delay the
                      time of the making or commencement of payments for up
                      to twenty-four (24) months after the date such payments
                      would otherwise be payable.

         Section 7.2  FORM OF DISTRIBUTION.  Benefits payable to the
Participant or, in the event of the Participant's death, to the Participant's
designated Beneficiary under the Plan shall be paid as follows:

         (a)          ACCOUNTS WHICH EXCEED $100,000.  If the amount credited
                      to the Participant's Account equals or exceeds One
                      Hundred Thousand Dollars ($100,000) as of the
                      distribution commencement date under Section 7.1,
                      distribution shall be made in a series of three (3)
                      annual installments, unless the Participant has made a
                      valid election to receive a single lump sum as
                      permitted by Section 7.2(c). The amount of each annual
                      installment shall be determined, as of a Valuation
                      Date, by dividing the amount credited to the Account as
                      of the Valuation Date as of which the installment is
                      being paid by the number of the remaining installment
                      payments to be made (including the payment being
                      determined). The Participant's Account shall continue
                      to be adjusted in accordance with the provisions of
                      Article V of the Plan.

         (b)          ACCOUNTS WHICH DO NOT EXCEED $100,000.  If the amount
                      credited to the Participant's Account does not exceed
                      One Hundred Thousands Dollars ($100,000) as of the
                      distribution commencement date under Section 7.1,
                      distribution shall be made in the form of a single lump
                      sum.

                                     -11-

<PAGE>

    (c)    LUMP SUM ELECTION. Other than as required by Section 7.2(b),
           benefits payable to the Participant or, in the event of the
           Participant's death, to the Participant's designated Beneficiary
           under the Plan shall be distributed in the form of a single lump
           sum if, and only if, the Participant makes an election to receive
           distribution of the amount credited to his or her Account in a
           single lump sum on a form to be furnished by, and which must be
           filed with, the Committee. However, an election of this lump sum
           payment option shall not be effective until the lapse of a period
           of twelve (12) months following the date on which such election
           form is accepted and approved by the Committee. Further, in no
           event will any such election of a lump sum payment option be
           effective if such election is made during the calendar year in
           which a distributable event described in Section 7.1 occurs and no
           election may be made once a distributable event occurs. No spouse,
           former spouse, Beneficiary or other person shall have any right to
           participate in the Participant's election to receive a single lump
           sum.

    Section 7.3  PAYMENT TO BENEFICIARY.  The Beneficiary of a deceased
Participant shall receive the payment of any benefits payable on behalf of
the Participant under the Plan in such form and manner as the Participant
would have received had the Participant survived. Such distribution shall be
made (or, in the case of installments, shall commence) as soon as practicable
after the Valuation Date immediately following the date the written application
for benefits filed by the Beneficiary is accepted and approved by
the Committee.

    Section 7.4  CHANGE IN CONTROL DISTRIBUTIONS.

    (a)    WHEN AVAILABLE.  A Participant or Beneficiary may apply for and
           receive a distribution of the entire payable to or with respect to
           the Participant under the Plan (after reduction for the forfeiture
           described in subsection (c) of this Section 7.4) if a Change in
           Control has occurred. To receive such a Change in Control
           distribution, the Participant or Beneficiary must file a written
           distribution application with the Committee. The Committee. shall
           approve the Change in Control distribution if such application has
           been filed and a Change in Control has occurred.

    (b)    PAYMENT.  Distribution of the entire benefit payable to or with
           respect to the Participant under the Plan (after reduction for the
           forfeiture described in subsection (c) of this Section 7.4) shall
           be made as of the Valuation Date coincident with or next following
           the approval of a completed application by the Committee. Such
           Change in Control distribution shall be made by PDS or its
           successor in a lump sum payment as soon as administratively
           feasible after such Valuation Date. The amount of the Change in
           Control distribution shall be equal to the value of the Vested
           amounts credited to the Account as

                                     -12-
<PAGE>

           of such Valuation Date (after reduction for the forfeiture
           described in subsection (c) below).

    (c)    FORFEITURE.  Upon the approval of a Change in Control
           distribution, there shall be irrevocably forfeited from the amount
           payable to the Participant or his or her Beneficiary under this
           Section 7.4 an amount equal to ten percent (10%) of the amount
           payable to the Participant or his or her Beneficiary under this
           Section 7.4.

    Section 7.5  HARDSHIP WITHDRAWALS.  In addition to the other distribution
provisions of this Article VII and notwithstanding any provision herein to
the contrary, in the event a Participant incurs an unforeseeable emergency,
the Participant may request, by providing a written request to the Committee,
a hardship withdrawal of all or any portion of his or her benefits from his
or her Account under the Plan. An unforeseeable emergency is a severe
financial hardship to the Participant resulting from a sudden and unexpected
illness or accident of the Participant or of a dependent (as defined in
section 152(a) of the Code) of the Participant, loss of the Participant's
property due to casualty, or other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of the
Participant. If such a request is approved by the Committee, which decision
by the Committee shall be made in its sole discretion on a case by case
basis, a hardship withdrawal may be permitted under this Section 7.5.
Withdrawals of amounts because of an unforeseeable emergency are only
permitted to the extent reasonably needed to satisfy the emergency need. This
provision shall be interpreted and construed in a manner consistent with the
requirements of sections 1.457-2(h)(4) and 1.457-2(h)(5) of the Treasury
Regulations.

    Section 7.6 DESIGNATION OF BENEFICIARIES.

    (a)    RIGHT TO DESIGNATE.  Each Participant may designate, upon forms to
           be furnished by and filed with the Committee, one or more primary
           Beneficiaries or alternative Beneficiaries to receive all or a
           specified portion of any benefits which may be payable with
           respect to the Participant under the Plan in the event of such
           Participant's death. The Participant may change or revoke any such
           designation from time to time without notice to or consent from
           any Beneficiary. No such designation, change or revocation shall
           be effective unless executed by the Participant and received and
           accepted by the Committee during the Participant's lifetime.

    (b)    FAILURE OF DESIGNATION.  If a Participant:

             (i)    fails to designate a Beneficiary,

            (ii)    designates a Beneficiary and thereafter revokes such
                    designation without naming another Beneficiary, or

                                     -13-
<PAGE>

           (iii)    designates one or more Beneficiaries and all such
                    Beneficiaries so designated fail to survive the Participant,

           the benefits which may be payable with respect to the Participant
           under the Plan, or the part thereof as to which such Participant's
           designation fails, as the case may be, shall be payable to the
           first class of the following classes of automatic Beneficiaries
           with a member surviving the Participant and (except in the case of
           surviving issue) in equal shares if there is more than one member
           in such class surviving the Participant:

             (i)    Participant's surviving spouse,

            (ii)    Participant's surviving issue per stirpes and not per
                    capita,

           (iii)    Participant's surviving parents,

            (iv)    Participant's surviving brothers and sisters,

             (v)    Representatives of Participant's estate.

    (c)    DISCLAIMERS BY BENEFICIARIES.  A Beneficiary entitled to a
           distribution of all or portion of the benefits which may be
           payable with respect to the Participant under the Plan may
           disclaim an interest therein subject to the following
           requirements. To be eligible to disclaim, a Beneficiary must be a
           natural person, must not have received a distribution of all or
           any portion of the benefits which may be payable with respect to
           the Participant under the Plan at the time such disclaimer is
           executed and delivered, and must have attained at least age
           twenty-one (21) years as of the date of the Participant's death.
           Any disclaimer must be in writing and must be executed personally
           by the Beneficiary before a notary public. A disclaimer shall
           state that the Beneficiary's entire interest in the undistributed
           benefits payable with respect to the Participant under the Plan is
           disclaimed or shall specify what portion thereof is disclaimed. To
           by effective, duplicate original executed copies of the disclaimer
           must be both executed and actually delivered to the Committee
           after the date of the Participant's death but not later than one
           hundred eighty (180) days after the date of the Participant's
           death. A disclaimer shall be irrevocable when delivered to the
           Committee. A disclaimer shall be considered to be delivered to the
           Committee only when actually received and acknowledged by the
           Committee. The Committee shall be the sole judge of the content,
           interpretation and validity of a purported disclaimer. Upon the
           filing of a valid disclaimer, the Beneficiary shall be considered
           not to have survived the Participant as to the interest
           disclaimed. A disclaimer by a beneficiary shall not be considered
           to be a transfer of an interest in violation.

                                     -14-
<PAGE>

           of the provisions of Article VII and shall not be considered to be
           an assignment or alienation of benefits in violation of federal
           law prohibiting the assignment or alienation of benefits under
           this Plan. No other form of attempted disclaimer shall recognized
           by the Committee.

    (d)    DEFINITIONS.  When used herein and, unless the Participant has
           otherwise specified in the Participant's Beneficiary designation,
           when used in a Beneficiary designation, "issue" means all persons
           who are lineal descendants of the person whose issue are referred
           to, including legally adopted descendants and their descendants
           but not including illegitimate descendants and their descendants;
           "child" means an issue of the first generation; "per stirpes"
           means in equal shares among living children of the person whose
           issue are referred to and the issue (taken collectively) of each
           deceased child of such person, with such issue taking by right of
           representation of such deceased child; and "survive and
           "surviving" mean living after the death of the Participant.

    (e)    SPECIAL RULES.  Unless the Participant has otherwise specified in
           the Participant's Beneficiary designation, the following rules
           shall apply:

             (i)    If there is not sufficient evidence that a Beneficiary
                    was living at the time of death of the Participant, it
                    shall be deemed that the Beneficiary was not living at
                    the time of the death of the Participant.

            (ii)    The automatic Beneficiaries specified in subsection (b)
                    of this Section 7.6 and the Beneficiaries designated by
                    the Participant shall become fixed at the time of the
                    Participant's death so that, if a Beneficiary survives
                    the Participant but dies before the receipt of all payments
                    due such Beneficiary hereunder, such remaining payments
                    shall be payable to the representative of such
                    Beneficiary's estate.

           (iii)    If the Participant designates as a Beneficiary the person
                    who is the Participants's spouse on the date of the
                    designation, either by name or by relationship, or both,
                    the dissolution, annulment or other legal termination of
                    the marriage between the Participant and such person shall
                    automatically revoke such designation. (The foregoing
                    shall not prevent the Participant from designating a
                    former spouse as a Beneficiary on a form executed by the
                    Participant and received by the Committee after the date
                    of the legal termination of the marriage between the
                    Participant and such former spouse, and during the
                    Participant's lifetime.)

                                     -15-

<PAGE>

                  (iv)  Any designation of a nonspouse Beneficiary by name
                        that is accompanied by a description of relationship
                        to the Participant shall be given effect without
                        regard to whether the relationship to the Participant
                        exists either then or at the Participant's death.

                  (v)   Any designation of a Beneficiary only by statement of
                        relationship to the Participant shall be effective only
                        to designate the person or persons standing in such
                        relationship to the Participant at the Participant's
                        death.

         (f)      VALIDITY OF DESIGNATION. A Beneficiary designation is
                  permanently void if it either is executed or is filed by a
                  Participant who, at the time of such execution or filing, is
                  then a minor under the law of the state of the Participant's
                  legal residence. The Committee shall be the sole judge of the
                  content, interpretation and validity of a purported
                  Beneficiary designation.

         (g)      NO SPOUSAL RIGHTS. Prior to the death of the Participant, no
                  spouse or surviving spouse of a Participant and no person
                  designated to be a Beneficiary shall have any rights or
                  interest in the benefits credited under this Plan including,
                  but not limited to, the right to be the sole Beneficiary or to
                  consent to the designation of Beneficiaries (or the changing
                  of designated Beneficiaries) by the Participant.

         Section 7.7 DEATH PRIOR TO FULL DISTRIBUTION. If, at the death of
the Participant, any payment to the Participant was due or otherwise
distributable but not actually paid, the amount of such payment shall be
included in the Account which is payable to the Beneficiary (and shall not
be paid to the Participant's estate).

         Section 7.8 FACILITY OF PAYMENT. In case of the legal disability,
including minority, of a Participant or Beneficiary eligible to receive
distribution of a benefit payable under the terms of the Plan, such benefit
shall be paid PDS, if the Committee shall be advised of the existence of such
condition:

                  (i)  to the duly appointed guardian, conservator or other
                       legal representative of such Participant or Beneficiary,
                       or

                  (ii) to a person or institution entrusted with the care or
                       maintenance of the incompetent or disabled Participant or
                       Beneficiary, provided such person or institution has
                       satisfied the Committee that the payment will be used
                       for the best interest and assist in the care of such
                       Participant or Beneficiary, and provided further, that no
                       prior claim for said payment has been made by duly
                       appointed guardian,

                                     -16-

<PAGE>

                       conservator or other legal representative of such
                       Participant or Beneficiary.
Any payment made in accordance with the foregoing provisions of this section
shall constitute a complete discharge of any liability or obligation of PDS
therefor.

         Section 7.9 FORM OF DISTRIBUTION. Distribution from this Plan shall
be payable only in U.S. dollars.

         Section 7.10 DISTRIBUTIONS AS A RESULT OF TAX DETERMINATION.
Notwithstanding any provision in this Plan to the contrary, if, at any time,
a court or the Internal Revenue Service determines that the value of any
amounts credited to a Participant's Account under the Plan is includable in
the gross income of the Participant and subject to tax, the Committee may, in
its sole discretion, permit a lump sum distribution of an amount equal to the
value of such amounts determined to be includable in the Participant's gross
income.

         Section 7.11 NO PARACHUTE PAYMENT. If the Committee in its
reasonable discretion following consultation with appropriate tax and/or
legal advisors reasonably determines that a distribution will likely
constitute an "excess parachute payment" under section 280G of the Code, the
"excess parachute payment" will not be distributed in order to avoid any
adverse tax consequences under section 280G. Furthermore, if such a
determination is made subsequent to a Change in Control, the Committee shall,
at the expense of PDS, promptly request a written opinion of an "independent
auditor" with respect to the applicability of such section 280G and the
amount of the distribution shall be limited to avoid such an excess parachute
payment unless and until the independent auditor delivers its written
unqualified opinion, a copy of which shall be provided to the Participant, to
the effect that a distribution of benefits will not constitute a parachute
payment under section 280G of the Code. As used in this Section 7.11, the
term "independent auditor" means the firm of certified public accountants
which at the time of the Change in Control had been most recently engaged by
PDS  or such other comparable and nationally recognized firm of certified
public accountants as may be selected by the Committee in its reasonable
discretion.

                                ARTICLE VIII

                               FUNDING OF PLAN

         Section 8.1 UNFUNDED AND UNSECURED PLAN. The Plan shall at all times
be considered entirely unfunded both for tax purposes and for purposes of
Title I of ERISA, and no provision shall at any time be made with respect to
segregating assets of an Employer for payment of any amounts under the Plan.
The obligation of an Employer to make payments under this Plan constitutes
only the unsecured (but legally enforceable) promise of the Employer to make
such payments. Any funds invested under the Plan by an Employer shall
continue for all purposes to be part of the general assets of the Employer
and available to the general creditors of the Employer in the event of a
bankruptcy (involvement in a pending proceeding under the Federal Bankruptcy
Code) or insolvency

                                     -17-

<PAGE>

(inability to pay debts as they mature) of the Employer. No Participant shall
have any lien, prior claim or other security interest in any property of PDS.
PDS  shall have no obligation to establish or maintain any fund, trust or
account (other than a bookkeeping account or reserve) for the purpose of
funding or paying the benefits promised under this Plan. If such a fund,
trust or account is established, the property therein shall remain the sole
and exclusive property of PDS. PDS shall be obligated to pay the cost of this
Plan out of its general assets. All references to accounts, accruals, gains,
losses, income, expenses, payments, custodial funds and the like are included
merely for the purpose of measuring the obligation of an Employer to
Participants in this Plan and shall not be construed to impose on the Employer
the obligation to create any separate fund for purposes of this Plan.

         Section 8.2 CORPORATE OBLIGATION. Neither the officers of PDS nor
any member of this Committee in any way secures or guarantees the payment of
any benefit or amount which may become due and payable hereunder to or with
respect to any Participant. Each Participant and other person entitled at any
time to payments hereunder shall look solely to the assets of his or her
Employer for such payments as an unsecured, general creditor. After benefits
shall have been paid to or with respect to a Participant and such payment
purports to cover in full the benefit hereunder, such former Participant or
other person or persons, as the case may be, shall have no further right or
interest in the other assets of any Employer in connection with this Plan. No
person shall be under any liability or responsibility for failure to effect
any of the objectives or purposes of this Plan by reason of the insolvency of
PDS.

                                  ARTICLE IX

                           AMENDMENT AND TERMINATION

         Section 9.1 AMENDMENT AND TERMINATION.

         (a)         BEFORE A CHANGE IN CONTROL. Prior to the occurrence of a
                     Change in Control, the Board of Directors may unilaterally
                     amend a Plan Statement prospectively, retroactively or
                     both, at any time and for any reason deemed sufficient by
                     it without notice to any person affected by this Plan and
                     may likewise terminate this Plan both with regard to
                     persons currently receiving benefits under the Plan and
                     persons expecting to receive benefits in the future;
                     provided, however, that:

                     (i)  the benefit, if any, payable to or with respect to
                          a Participant who has had a Termination of Employment
                          as of the effective date of such amendment or the
                          effective date of such termination shall not be,
                          without the written consent of the Participant,
                          diminished or delayed by such amendment or termination
                          (but the Board of Directors may amend the Plan
                          Statement to otherwise modify the payment of any

                                     -18-

<PAGE>

                          such benefit including, but not limited to,
                          accelerating the value of all remaining payments into
                          a single lump sum payment), and

                     (ii) the benefit, if any, payable to or with respect to
                          each other Participant determined as if such
                          Participant had a Termination of Employment on the
                          effective date of such amendment or the effective date
                          of such termination shall not be, without the written
                          consent of the Participant, diminished or delayed by
                          such amendment or termination (but the Board of
                          Directors may amend the Plan Statement to otherwise
                          modify the payment of any such benefit including, but
                          not limited to, accelerating the value of all
                          remaining payments into a single lump sum payment).

         (b)         AFTER A CHANGE IN CONTROL.

                     (i)  EXISTING PARTICIPANTS. After the occurrence of a
                          Change in Control, the Board of Directors may only
                          amend the Plan Statement or terminate this Plan as
                          applied to Participants who are Participants on the
                          date of the Change in Control if:

                          (A)  all benefits payable to or with respect to
                               persons who were Participants as of the Change
                               in Control (including benefits earned before and
                               benefits earned after the Change in Control) have
                               been paid in full, or

                          (B)  eighty percent(80%) of all the Participants
                               determined as of the date of the Change in
                               Control give knowing and voluntary written
                               consent to such amendment or termination.

                     (ii) NEW PARTICIPANTS. After the occurrence of a Change
                          in Control, as applied to Participants who are not
                          Participants on the date of the Change in Control,
                          the Board of Directors may unilaterally amend the
                          Plan Statement prospectively, retroactively or both,
                          at any time and for any reason deemed sufficient by
                          it without notice to any person affected by this
                          Plan and may likewise terminate this Plan.

         Section 9.2 NO ORAL AMENDMENTS. No modification of the terms of the
Plan Statement or termination of this Plan shall be effective unless it is in
writing and signed on behalf of the Board of Directors by a person authorized
to execute such writing. No oral representation concerning the interpretation
or effect of the Plan Statement shall be effective to amend the Plan
Statement.

         Section 9.3 PLAN BINDING ON SUCCESSORS. PDS will require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise to all or substantially all of the business

                                     -19-
<PAGE>

and/or assets of PDS), by agreement, to expressly assume and agree to perform
this Plan in the same manner and to the same extent that PDS would be
required to perform it if no such succession had taken place.

                                  ARTICLE X

                   DETERMINATIONS -- RULES AND REGULATIONS

         Section 10.1  DETERMINATIONS.  The Board of Directors and the
Committee shall make such determinations as may be required from time to time
in the administration of this Plan. The Board of Directors and the Committee
shall have the discretionary authority and responsibility to interpret and
construe the Plan Statement and to determine all factual and legal questions
under this Plan, including but not limited to the entitlement of Participants
and Beneficiaries to any benefits which may be payable under the Plan, and
the amounts of their respective interests. Each interested party may act and
rely upon all information reported to them hereunder and need not inquire
into the accuracy thereof, nor be charged with any notice to the contrary.

         Section 10.2  RULES AND REGULATIONS.  Any rule not in conflict or at
variance with the provisions hereof may be adopted by the Committee.

         Section 10.3  METHOD OF EXECUTING INSTRUMENTS.  Information to be
supplied or written notices to be made or consents to be given by the
Committee pursuant to any provision of the Plan Statement may be signed in
the name of the Committee by any officer who has been authorized to make such
certification or to give such notices or consents.

         Section 10.4  CLAIMS PROCEDURE.  The claims procedure set forth in
this Section 10.4 shall be the exclusive administrative procedure for the
disposition of claims for benefits arising under this Plan.

         (a)           ORIGINAL CLAIM.  Any person may, if he or she so
                       desires, file with the Committee a written claim for
                       benefits under this Plan. Within ninety (90) days
                       after the filing of such a claim, the Committee shall
                       notify the claimant in writing whether the claim is
                       upheld or denied in whole or in part or shall furnish
                       the claimant a written notice describing specific
                       special circumstances requiring a specified amount of
                       additional time (but not more than one hundred eighty
                       (180) days from the date the claim was filed) to reach
                       a decision on the claim. If the claim is denied in
                       whole or in part, the Committee shall state in writing:

                       (i)   the specific reasons for the denial;

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

                                      -20-

<PAGE>

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

                       (iv)  an explanation of the claims review procedure
                             set forth in this section.

         (b)           REVIEW OF DENIED CLAIM.  Within sixty (60) days after
                       receipt of notice that the claim has been denied in
                       whole or in part, the claimant may file with the Board
                       of Directors a written request for a review and may,
                       in conjunction therewith, submit written issues and
                       comments. Within sixty (60) days after the filing of
                       such a request for review, the Board of Directors
                       shall notify the claimant in writing whether, upon
                       review, the claim was upheld or denied in whole or in
                       part or shall furnish the claimant a written notice
                       describing specific special circumstances requiring a
                       specified amount of additional time (but not more than
                       one hundred twenty (120) days from the date the
                       request for review was filed) to reach a decision on
                       the request for review.

         (c)           GENERAL RULES.

                       (i)   No inquiry or question shall be deemed to be a
                             claim or a request for a review of a denied
                             claim unless made in accordance with the claims
                             procedure. The Committee may require that any
                             claim for benefits and any request for a review
                             of a denied claim be filed on forms to be
                             furnished by the Committee upon request.

                       (ii)  All decisions on Original claims shall be made
                             by the Committee and all decisions on requests
                             for a review of denied claims shall be made by
                             the Board of Directors.

                       (iii) the Committee and the Board of Directors may, in
                             their discretion, hold one or more hearings on a
                             claim or a request for a review of a denied
                             claim.

                       (iv)  A claimant may be represented by a lawyer or
                             other representative (at the claimant's own
                             expense), but the Committee and the Board of
                             Directors reserves the right to require the
                             claimant to furnish written authorization. A
                             claimant's representative shall be entitled,
                             upon request, to copies of all notices given to
                             the claimant.

                       (v)   The decision of the Committee on a claim and a
                             decision of the Board of Directors on a request
                             for a review of a denied claim shall be served
                             on the claimant in writing. If a decision or
                             notice is not

                                     -21-

<PAGE>

                             received by a claimant within the time
                             specified, the claim or request for a review of
                             a denied claim shall be deemed to have been
                             denied.

                       (vi)  Prior to filing a claim or a request for a
                             review of a denied claim, the claimant or his or
                             her representative shall have a reasonable
                             opportunity to review a copy of the Plan
                             Statement and all other pertinent documents in
                             the possession of the Committee and the Board of
                             Directors.

                       (vii) The Committee and the Board of Directors may
                             permanently or temporarily delegate its
                             responsibilities under this claims procedure to
                             an individual or a committee of individuals.

         Section 10.5  LIMITATIONS AND EXHAUSTION.

         (a)           LIMITATIONS.  No claim shall be considered under these
                       administrative procedures unless it is filed with the
                       Committee within one (1) year after the claimant knew
                       (or reasonably should have known) of the principal
                       facts on which the claim is based. Every untimely
                       claim shall be denied by the Committee without regard
                       to the merits of the claim. No legal action (whether
                       arising under section 502 or section 510 or ERISA or
                       under any other statute or non-statutory law) may be
                       brought by any claimant on any matter pertaining to
                       this Plan unless the legal action is commenced in the
                       proper forum before the earlier of:

                       (i)   two (2) years after the claimant knew (or
                             reasonably should have known) of the principal
                             facts on which the claim is based, or

                       (ii)  ninety (90) days after the claimant has
                             exhausted these administrative procedures.

                       Knowledge of all facts that a Participant knew (or
                       reasonably should have known) shall be imputed to each
                       claimant who is or claims to be a Beneficiary of the
                       Participant (or otherwise claims to derive an
                       entitlement by reference to a Participant) for the
                       purpose of applying the one (1) year and two (2) year
                       periods.

         (b)           EXHAUSTION REQUIRED.  Except as provided in subsection
                       (c) of this Section 10.5, the exhaustion of these
                       administrative procedures is mandatory for resolving
                       every claim and dispute arising under this Plan. As to
                       such claims and disputes:

                                     -22-

<PAGE>

                       (i)   no claimant shall be permitted to commence any
                             legal action relating to any such claim or
                             dispute (whether arising under section 502 or
                             section 510 of ERISA or under any other statute
                             or non-statutory law) unless a timely claim has
                             been filed under these administrative procedures
                             and these administrative procedures have been
                             exhausted; and

                       (ii)  in any such legal action all explicit and
                             implicit determinations by the Committee and the
                             Board of Directors (including, but not limited
                             to, determinations as to whether the claim was
                             timely filed) shall be afforded the maximum
                             deference permitted by law.

         (c)           EXHAUSTION NOT REQUIRED.  The exhaustion of these
                       administrative procedures is not mandatory for
                       resolving any dispute arising under this Plan insofar
                       as the dispute pertains to any matter that arose after
                       a Change in Control or within the one hundred twenty
                       (120) days before a Change in Control. As to such
                       matters:

                       (i)   a claimant shall be permitted to commence a
                             legal action relating to any such matter
                             (whether arising under section 502 or section
                             510 of ERISA or under any other statute or
                             non-statutory law) even if a timely claim has
                             not been filed under these administrative
                             procedures and even if these administrative
                             procedures have not been exhausted; and

                       (ii)  in any legal action regarding the benefits
                             payable to or with respect to a Participant,
                             notwithstanding Section 10.1, determinations by
                             the Committee and the Board of Directors
                             (including determinations regarding when any
                             matter arose) shall not be afforded any
                             deference and the matter shall be heard DE NOVO;
                             and

                       (iii) if a Participant is the prevailing party in
                             litigating any claim for benefits under this
                             Plan, the Employers shall be jointly and
                             severally liable to pay reasonable attorney's
                             fees and costs of the action to the Participant.

                                     -23-

<PAGE>

                                 ARTICLE XI
                            PLAN ADMINISTRATION

    Section 11.1 OFFICERS. Except as hereinafter provided, functions
generally assigned to PDS shall be discharge by its officers or delegated and
allocated as provided herein.

    Section 11.2 CHIEF EXECUTIVE OFFICER. Except as hereinafter provided, the
Chief Executive Officer of PDS may delegate or redelegate and allocate and
reallocate to one or more persons or to a committee of persons jointly or
severally, and whether or not such persons are directors, officers or
employees, such functions assigned to PDS generally hereunder as the Chief
Executive Officer may from time to time deem advisable.

    Section 11.3 BOARD OF DIRECTORS. Notwithstanding the foregoing, the Board
of Directors shall have the exclusive authority, which may not be delegated,
to amend the Plan Statement, to terminate this Plan and to determine
eligibility to participate in this Plan under Section 3.1.

    Section 11.4 COMMITTEE. The Committee shall be the Compensation Committee
of the Board of Directors of PDS and whose member shall serve at the pleasure
of the Board of Directors of PDS. Members of the Committee shall serve
without compensation with respect to their duties in the administration of
the Plan, but their reasonable expenses shall be an expense of the
administration of the Plan and shall be paid by PDS. The Committee may elect
such officers as the Committee may decide upon. A member of the Committee
shall automatically be removed as a member of the Committee at the earliest
time such individual ceases to be a director. This removal shall occur
automatically and without any requirement for action by the Employers or any
notice to the individual so removed. The Committee shall:

    (a)     establish rules for the functioning of the Committee, including
            the times and places for holding meetings, the notices to be
            given in respect of such meetings and the numbers who shall
            constitute a quorum for the transaction of business;

    (b)     organize and delegate to such of its members as it shall select
            authority to execute or authenticate rules, advisory opinions or
            instructions, and other instruments adopted or authorized by the
            Committee; adopt such bylaws or regulations as it deems desirable
            for the conduct of its affairs; appoint a secretary, who need
            not be a member of the Committee, to keep its records and
            otherwise assist the Committee in the performance of its duties;
            keep a record of all its proceedings and acts and keep all books
            of account, records and other data as may be necessary for the
            proper administration of the Plan; notify the Employers of any
            action taken by the Committee and, when required, notify any
            other interested person or persons;

                                      -24-

<PAGE>

    (c)     determine from the records of the Employers the compensation,
            status and other facts regarding Participants and other employees;

    (d)     prescribe forms to be used for distributions, notifications,
            etc., as may be required in the administration of the Plan;

    (e)     set up such rules, applicable to all Participants similarly
            situated, as are deemed necessary to carry out the terms of this
            Plan Statement;

    (f)     perform all other acts reasonably necessary for administering the
            Plan and carrying out the provisions of this Plan Statement and
            performing the duties imposed on it by the Board of Directors of
            PDS;

    (g)     resolve all questions of administration of the Plan not
            specifically referred to in this section;

    (h)     in accordance with regulations of the Secretary of Labor, provide
            adequate notice in writing to any claimant whose claim for
            benefits under the Plan has been denied, setting forth the
            specific reasons for such denial, written in a manner calculated
            to be understood by the claimant; and

    (i)     delegate or redelegate to one or more persons, jointly or
            severally, and whether or not such persons are members of the
            Committee or employees of any Employer, such functions assigned
            to the Committee hereunder as it may from time to time deem
            advisable.

If there shall at any time be three (3) or more members of the Committee
serving hereunder who are qualified to perform a particular act, the same may
by performed, on behalf of all, by a majority of those qualified, with or
without the concurrence of the minority. No person who failed to join or
concur in such act shall be held liable for the consequences thereof, except
to the extent that liability is imposed under the Employee Retirement Income
Security Act of 1974.

    Section 11.5 DELEGATION. The Board of Directors and the members of the
Committee shall not be liable for an act or omission of another person with
regard to a responsibility that has been allocated to or delegated to such
other person pursuant to the terms of the Plan Statement or pursuant to
procedures set forth in the Plan Statement.

    Section 11.6 CONFLICT OF INTEREST. If any individual to whom authority
has been delegated or redelegated hereunder shall also be a Participant in
this Plan, such Participant shall have no authority with respect to any
matter specially affecting such Participant's individual interest hereunder
or the interest of a person superior to him or her in the organization (as
distinguished from the interest of all Participants and Beneficiaries or a
broad class of Participants and Beneficiaries), all such authority being
reserved exclusively to other individuals as the case may be, to the exclusion

                                     -25-

<PAGE>

of such Participant, and such Participant shall act only in such
Participant's individual capacity in connection with any such matter.

    Section 11.7 ADMINISTRATOR. PDS shall administrator for purposes of
section 3(16)(A) of ERISA.

    Section 11.8 SERVICE OF PROCESS. In the absence of any designation to the
contrary by the Committee, the Secretary of PDS is designated as the
appropriate and exclusive agent for the receipt of directed to this Plan in
any legal proceeding, including arbitration, involving this Plan.

    Section 11.9 EXPENSES. All expenses of administering this Plan shall be
borne by PDS.

    Section 11.10 SPENDTHRIFT PROVISION. No Participant or Beneficiary shall
have any interest in the Account which can be transferred nor shall any
Participant of Beneficiary have any power to anticipate, alienate, dispose of,
pledge or encumber the same while in the possession or control of the
Employers, nor shall the Committee recognize any assignment thereof, either
in whole or in part, nor shall the Account be subject to attachment,
garnishment, execution following judgment or other legal process before the
Account is distributed to the Participant or Beneficiary.

    The power to designate Beneficiaries to receive any benefits payable to
or with respect to a Participant under the Plan in the event of such
Participant's death shall not permit or be construed to permit such power or
right to be exercised by the Participant so as thereby to anticipate, pledge,
mortgage or encumber such benefits or any part thereof and any attempt of a
Participant to so exercise said power in violation of this provision shall be
of no force and effect and shall be disregarded by the Committee.

    Section 11.11 TAX WITHHOLDING. The Employer shall withhold the amount of
any federal, state or local income tax or other tax required to be withheld
by the Employer under applicable law with respect to any amount payable under
this Plan.

     Section 11.12 CERTIFICATIONS. Information to be supplied or written
notices to be made or consents to be given by the Committee pursuant to any
provision of this Plan may be signed in the name of the Committee by any
officer who has been authorized to make such certification or to give such
notices or consents.

    Section 11.13 ERRORS IN COMPUTATIONS. PDS shall not be liable or
responsible for any error in the computation of the Account or the
determination of any benefit payable to or with respect to any Participant
resulting from any misstatement of fact made by the Participant or by or on
behalf of any survivor to whom such benefit shall be payable, directly or
indirectly, to PDS and used by the Committee in determining the benefit. The
Committee shall not be obligated or required to increase the benefit payable
to or with respect to such Participant which, on discovery of the
misstatement, is found to be understated as a result of such misstatement of
the Participant. However, the benefit

                                     -26-

<PAGE>

of any Participant which is overstated by reason of any such misstatement or
any other reason shall be reduced to the amount appropriate in view of the
truth (and to recover any prior overpayment).

    Section 11.14 NO EMPLOYMENT RIGHTS. Neither the Plan nor any action taken
under the Plan shall be construed as providing any Participant any right to
be retained in the service or employ of PDS.

    Section 11.15 PARTICIPANTS SHOULD CONSULT ADVISORS. Neither PDS nor its
directors, officers, employees or agents makes any representation or warranty
with respect to the federal, state or other tax, financial, estate planning,
or the securities or other legal implications of participation in the Plan.
Participants should consult with their own tax, financial and legal advisors
with respect to their participation in the Plan.

                                ARTICLE XII

                                CONSTRUCTION

    Section 12.1 APPLICABLE LAWS.

    (a)     ERISA STATUS. This Plan is adopted with the understanding that
            it is an unfunded plan maintained primarily for the purpose of
            providing deferred compensation for a "select group of management
            or highly compensated employees" as provided in section 201(2),
            section 301(a)(3) and section 401(a)(1) of ERISA. Each provision
            shall be interpreted and administered accordingly.

    (b)     IRC STATUS.  This Plan is intended to be a nonqualified deferred
            compensation arrangement. The rules of section 401(a) ET. SEQ. of
            the Code shall not apply to this Plan. The rules of section
            3121(v) and section 3306(r)(2) of the Code shall apply to this
            Plan.

    (c)     REFERENCE TO LAWS. Any reference in the Plan Statement to a
            statute or regulation shall be considered also to mean and refer
            to any subsequent amendment or replacement of that statute or
            regulation.

    Section 12.2 EFFECT ON OTHER PLANS. This Plan shall not alter, enlarge or
diminish any person's employment rights or obligations or rights or
obligations under any other employee pension benefit or employee welfare
benefit plan maintained by PDS. It being expressly intended that this Plan
shall not be affected by the benefit structures of any other plan maintained
by PDS as any such plan may exist at the adoption of this Plan or upon the
commencement of participation or at any other time.

                                     -27-

<PAGE>

    Section 12.3 DISQUALIFICATION. Notwithstanding any other provision of the
Plan Statement or any election or designation made under this Plan, any
individual who feloniously and intentionally kills a Participant shall be
deemed for all purposes of this Plan and all elections and designations made
under this Plan to have died before such Participant. A final judgement of
conviction of felonious and international killing is conclusive for this
purpose. In the absence of a conviction of felonious and intentional killing,
the Committee shall determine whether the killing was felonious and
intentional for this purpose.

    Section 12.4 RULES OF DOCUMENT CONSTRUCTION.

    (a)     An individual shall be considered to have attained a given age on
            such individual's birthday for that age (and not on the day
            before). Individuals born on February 29 in a leap year shall be
            considered to have their birthdays on February 28 in each year
            that is not a leap year.

    (b)     Whenever appropriate, words used herein in the singular may be
            read in the plural, or words used herein in the plural may be
            read in the singular; the masculine may include the feminine;
            and the words "hereof," "herein" or "hereunder" or other similar
            compounds of the word "here" shall mean and refer to the entire
            Plan Statement and not to any particular paragraph or Section of
            the Plan Statement unless the context clearly indicates to the
            contrary.

    (c)     The titles given to the various Sections of the Plan Statement
            are inserted for convenience of reference only and are not part
            of the Plan Statement, and they shall not be considered in
            determining the purpose, meaning or intent of any provision
            hereof.

    (d)     Notwithstanding any thing apparently to the contrary contained in
            the Plan Statement, the Plan Statement shall be construed and
            administered to prevent the duplication of benefits provided
            under this Plan and any other qualified or nonqualified plan
            maintained in whole or in part by the Employers.

    Section 12.5 CHOICE OF LAW. This instrument has been executed and
delivered in the State of Nevada and has been drawn in conformity to the laws
of that State and shall, except to the extent that federal law is
controlling, be construed and enforced in accordance with the laws of the
State of Nevada.

    Section 12.6 NO EMPLOYMENT CONTRACT. This Plan is not and shall not be
deemed to constitute a contract of employment between an Employer and any
person, nor shall anything herein contained be deemed to give any person any
right to be retained in an Employer's employ or in any way limit or restrict
the Employer's right or power to discharge any person at any time and to
treat any person without regard to the effect which such treatment might have
upon him or her as a

                                     -28-

<PAGE>

Participant in this Plan. Neither the terms of the Plan Statement nor the
benefits under this Plan nor the continuance of the Plan shall be a term of
the employment of any employee. The Employers shall not be obliged to
continue this Plan.

April 1, 2000                                 PDS FINANCIAL CORPORATION

                                           By /s/ Lona Finley
                                              ________________________________
                                                     Lona Finley

                                              Its Corporate Secretary/Director
                                                  ____________________________

                                     -29-

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