Document:

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                                                                    Exhibit 10.1

                             THE 2001 RESTATEMENT OF
                        THE HARRAH'S ENTERTAINMENT, INC.
                           SAVINGS AND RETIREMENT PLAN

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                                TABLE OF CONTENTS

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TABLE OF CONTENTS ...................................................................................................  2

ARTICLE I. DEFINITIONS ..............................................................................................  8

         Section 1.1       GENERAL ..................................................................................  8
         Section 1.2       ACCOUNTS .................................................................................  8
         Section 1.3       ACTIVE PARTICIPANT .......................................................................  9
         Section 1.4       ADMINISTRATIVE COMMITTEE .................................................................  9
         Section 1.5       ADMINISTRATOR ............................................................................  9
         Section 1.6       AFTER TAX CONTRIBUTION ...................................................................  9
         Section 1.7       ANNUAL ADDITION ..........................................................................  9
         Section 1.8       BENEFICIARY .............................................................................. 10
         Section 1.9       BOARD .................................................................................... 11
         Section 1.10      BREAK IN SERVICE ......................................................................... 11
         Section 1.11      CHIEF EXECUTIVE OFFICER .................................................................. 11
         Section 1.12      CODE ..................................................................................... 11
         Section 1.13      COMPANY .................................................................................. 12
         Section 1.14      COMPANY AFFILIATE ........................................................................ 12
         Section 1.15      HARRAH'S STOCK ........................................................................... 12
         Section 1.16      COMPENSATION ............................................................................. 12
         Section 1.17      CONTRIBUTION PERCENTAGE .................................................................. 13
         Section 1.18      DEFERRAL PERCENTAGE ...................................................................... 13
         Section 1.19      DIRECT ROLLOVER .......................................................................... 14
         Section 1.20      DISABILITY RETIREMENT .................................................................... 14
         Section 1.21      DISABILITY RETIREMENT DATE ............................................................... 14
         Section 1.22      DISTRIBUTEE .............................................................................. 14
         Section 1.23      EARLY RETIREMENT ......................................................................... 14
         Section 1.24      EARLY RETIREMENT DATE .................................................................... 15
         Section 1.25      EFFECTIVE DATE ........................................................................... 15
         Section 1.26      ELIGIBLE EMPLOYEE ........................................................................ 15
         Section 1.27      ELIGIBLE RETIREMENT PLAN ................................................................. 15
         Section 1.28      ELIGIBLE ROLLOVER DISTRIBUTION ........................................................... 15
         Section 1.29      EMPLOYEE ................................................................................. 17
         Section 1.30      EMPLOYER ................................................................................. 17
         Section 1.31      ERISA .................................................................................... 17
         Section 1.32      401(K) CONTRIBUTION ...................................................................... 17
         Section 1.33      FIVE PERCENT OWNER ....................................................................... 17
         Section 1.34      FORFEITURE BREAK IN SERVICE .............................................................. 17
         Section 1.35      FORFEITURE ............................................................................... 18

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         Section 1.36      FORMER PARTICIPANT ....................................................................... 18
         Section 1.37      HARDSHIP ................................................................................. 18
         Section 1.38      HIGHLY COMPENSATED EMPLOYEE .............................................................. 19
         Section 1.39      HOUR OF SERVICE .......................................................................... 19
         Section 1.40      HRC ...................................................................................... 21
         Section 1.41      INACTIVE PARTICIPANT ..................................................................... 21
         Section 1.42      INVESTMENT COMMITTEE ..................................................................... 21
         Section 1.43      INVESTMENT FUND .......................................................................... 22
         Section 1.44      LEASED EMPLOYEE .......................................................................... 22
         Section 1.45      LEVELING METHOD .......................................................................... 22
         Section 1.46      MATCH ENTRY DATE ......................................................................... 22
         Section 1.47      MATCHING CONTRIBUTION .................................................................... 23
         Section 1.48      MILITARY LEAVE ........................................................................... 23
         Section 1.49      NONHIGHLY COMPENSATED EMPLOYEE ........................................................... 23
         Section 1.50      NORMAL RETIREMENT ........................................................................ 23
         Section 1.51      NORMAL RETIREMENT DATE ................................................................... 23
         Section 1.52      PARTICIPANT .............................................................................. 23
         Section 1.53      PAYDAY ................................................................................... 23
         Section 1.54      PLAN ..................................................................................... 23
         Section 1.55      PLAN REPRESENTATIVE ...................................................................... 24
         Section 1.56      PLAN YEAR ................................................................................ 24
         Section 1.57      QDRO ..................................................................................... 24
         Section 1.58      QUALIFIED MATCHING CONTRIBUTION .......................................................... 24
         Section 1.59      QUALIFIED NONELECTIVE CONTRIBUTION ....................................................... 24
         Section 1.60      RULES OF THE PLAN ........................................................................ 24
         Section 1.61      SEPARATION FROM THE SERVICE .............................................................. 24
         Section 1.62      SPOUSAL CONSENT .......................................................................... 25
         Section 1.63      SPOUSE; SURVIVING SPOUSE ................................................................. 25
         Section 1.64      STATUTORY COMPENSATION ................................................................... 25
         Section 1.65      TRUST AGREEMENT .......................................................................... 25
         Section 1.66      TRUST FUND ............................................................................... 26
         Section 1.67      TRUSTEE .................................................................................. 26
         Section 1.68      VALUATION DATE ........................................................................... 26
         Section 1.69      YEAR OF ELIGIBILITY SERVICE .............................................................. 26
         Section 1.70      YEAR OF VESTING SERVICE .................................................................. 27

ARTICLE II. ELIGIBILITY ............................................................................................. 28

         Section 2.1       REQUIREMENTS FOR PARTICIPATION ........................................................... 28
         Section 2.2       INACTIVE STATUS .......................................................................... 28
         Section 2.3       FORMER PARTICIPANTS ...................................................................... 29

ARTICLE III. CONTRIBUTIONS .......................................................................................... 30

         Section 3.1       CONTRIBUTIONS IN GENERAL ................................................................. 30

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         Section 3.2       MAXIMUM ANNUAL CONTRIBUTION .............................................................. 30
         Section 3.3       PARTICIPANT CONTRIBUTIONS ................................................................ 30
         Section 3.4       MATCHING CONTRIBUTIONS ................................................................... 33
         Section 3.5       LIMITATION ON 401(K) CONTRIBUTIONS ....................................................... 34
         Section 3.6       LIMITATION ON MATCHING AND AFTER TAX CONTRIBUTIONS ....................................... 35
         Section 3.7       ALTERNATIVE USE LIMITATION TEST .......................................................... 37
         Section 3.8       LIMITATION ON ANNUAL ADDITIONS; TREATMENT OF OTHERWISE EXCESSIVE ALLOCATIONS ............. 38
         Section 3.9       REEMPLOYMENT RIGHTS AFTER QUALIFIED MILITARY SERVICE ..................................... 40

ARTICLE IV. ROLLOVERS AND TRANSFERS ................................................................................. 42

         Section 4.1       ROLLOVERS AND TRANSFERS .................................................................. 42

ARTICLE V. INVESTMENT OF ACCOUNTS ................................................................................... 44

         Section 5.1       INVESTMENT OPTIONS ....................................................................... 44
         Section 5.2       DEFAULT INVESTMENT FUND .................................................................. 44
         Section 5.3       INVESTMENT COMMITTEE ..................................................................... 45
         Section 5.4       PARTICIPANTS HAVE RIGHT TO VOTE AND TENDER HARRAH'S STOCK ................................ 45
         Section 5.5       REGISTRATION AND DISCLOSURE FOR HARRAH'S STOCK ........................................... 46
         Section 5.6       HARRAH'S STOCK FUND ...................................................................... 46
         Section 5.7       PUT OPTION ............................................................................... 46

ARTICLE VI. VALUATION OF THE TRUST FUND AND ACCOUNTS ................................................................ 48

         Section 6.1       INDIVIDUAL PARTICIPANT ACCOUNTING ........................................................ 48
         Section 6.2       PAYMENT OF FEES AND EXPENSES ............................................................. 48
         Section 6.3       PARTICIPANT STATEMENTS ................................................................... 48
         Section 6.4       ACCOUNTS FOR QDRO BENEFICIARIES .......................................................... 49
         Section 6.5       DETERMINATION OF VALUES .................................................................. 49
         Section 6.6       ALLOCATION OF VALUES ..................................................................... 49
         Section 6.7       APPLICABILITY OF ACCOUNT VALUES .......................................................... 50
         Section 6.8       HARRAH'S STOCK VALUATION ................................................................. 50

ARTICLE VII. VESTING ................................................................................................ 51

         Section 7.1       VESTING OF ACCOUNTS ...................................................................... 51
         Section 7.2       FORFEITURES .............................................................................. 52
         Section 7.3       RESTORATION OF FORFEITURES ............................................................... 52
         Section 7.4       USE OF FORFEITURES ....................................................................... 53
         Section 7.5       CHANGE IN CONTROL ........................................................................ 53

ARTICLE VIII. IN-SERVICE WITHDRAWALS ................................................................................ 55

         Section 8.1       IN-SERVICE WITHDRAWAL APPROVAL ........................................................... 55

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         Section 8.2       PAYMENT FORM AND MEDIUM .................................................................. 55
         Section 8.3       SOURCE AND TIMING OF IN-SERVICE WITHDRAWAL FUNDING ....................................... 55
         Section 8.4       SPOUSAL CONSENT .......................................................................... 55
         Section 8.5       FEES ..................................................................................... 55
         Section 8.6       HARDSHIP WITHDRAWALS ..................................................................... 55
         Section 8.7       ROLLOVER ACCOUNT WITHDRAWAL .............................................................. 56
         Section 8.8       AFTER TAX ACCOUNT WITHDRAWAL ............................................................. 57
         Section 8.9       MATCHING ACCOUNT WITHDRAWAL .............................................................. 57
         Section 8.10      AGE 59 1/2 WITHDRAWAL .................................................................... 57

ARTICLE IX. LOANS ................................................................................................... 58

         Section 9.1       PARTICIPANT LOANS PERMITTED .............................................................. 58
         Section 9.2       LOAN APPLICATION, NOTE AND SECURITY ...................................................... 58
         Section 9.3       LOAN APPROVAL ............................................................................ 58
         Section 9.4       SPOUSAL CONSENT .......................................................................... 58
         Section 9.5       LEGAL MAXIMUM LIMIT ...................................................................... 58

ARTICLE X. EMPLOYMENT AFTER NORMAL RETIREMENT DATE .................................................................. 59

         Section 10.1      CONTINUATION OF EMPLOYMENT ............................................................... 59
         Section 10.2      CONTINUATION OF PARTICIPATION ............................................................ 59
         Section 10.3      REQUIRED MINIMUM DISTRIBUTIONS ........................................................... 59

ARTICLE XI. DISTRIBUTIONS ........................................................................................... 60

         Section 11.1      RIGHTS UPON NORMAL OR DISABILITY RETIREMENT OR SEPARATION FROM THE SERVICE ............... 60
         Section 11.2      DISTRIBUTION OF ACCOUNTS ................................................................. 60
         Section 11.3      SMALL ACCOUNTS ........................................................................... 60
         Section 11.4      DETERMINATION OF VALUE OF ACCOUNTS ....................................................... 60
         Section 11.5      DISTRIBUTIONS OF HARRAH'S STOCK .......................................................... 61
         Section 11.6      TIMING ................................................................................... 62
         Section 11.7      NOTICE ................................................................................... 62
         Section 11.8      DISTRIBUTION UPON DEATH .................................................................. 62

ARTICLE XII. TOP HEAVY PROVISIONS ................................................................................... 64

         Section 12.1      TOP HEAVY DETERMINATION .................................................................. 64
         Section 12.2      MINIMUM BENEFITS ......................................................................... 67

ARTICLE XIII. ADMINISTRATIVE PROVISIONS ............................................................................. 69

         Section 13.1      DUTIES AND POWERS OF THE ADMINISTRATOR ................................................... 69
         Section 13.2      ADMINISTRATIVE COMMITTEE ................................................................. 70

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         Section 13.3      ADMINISTRATIVE COMMITTEE OPERATING RULES ................................................. 70
         Section 13.4      CLAIMS PROCEDURE ......................................................................... 70
         Section 13.5      CONFLICTING CLAIMS ....................................................................... 72
         Section 13.6      PAYMENTS ................................................................................. 72
         Section 13.7      EFFECT OF DELAY OR FAILURE TO ASCERTAIN AMOUNT DISTRIBUTABLE OR TO LOCATE DISTRIBUTEE .... 72
         Section 13.8      SERVICE OF PROCESS ....................................................................... 73
         Section 13.9      LIMITATIONS UPON POWERS OF THE ADMINISTRATOR ............................................. 73
         Section 13.10     ANTI-ALIENATION PROVISIONS ............................................................... 73
         Section 13.11     CORRECTIVE OF ADMINISTRATIVE ERRORS; SPECIAL CONTRIBUTIONS ............................... 74
         Section 13.12     ELECTRONIC ADMINISTRATION ................................................................ 74

ARTICLE XIV. TERMINATION, DISCONTINUANCE, AMENDMENT, MERGER, ADOPTION OF PLAN ....................................... 75

         Section 14.1      TERMINATION OF PLAN; DISCONTINUANCE OF CONTRIBUTIONS ..................................... 75
         Section 14.2      AMENDMENT OF PLAN ........................................................................ 75
         Section 14.3      RETROACTIVE EFFECT OF PLAN AMENDMENT ..................................................... 76
         Section 14.4      CONSOLIDATION OR MERGER, ADOPTION OF PLAN BY OTHER COMPANIES ............................. 76
         Section 14.5      ADOPTION OF PLAN BY COMPANY AFFILIATES ................................................... 77

ARTICLE XV. MISCELLANEOUS PROVISIONS ................................................................................ 78

         Section 15.1      IDENTIFICATION OF FIDUCIARIES ............................................................ 78
         Section 15.2      ALLOCATION OF FIDUCIARY RESPONSIBILITIES ................................................. 78
         Section 15.3      LIMITATION ON RIGHTS OF EMPLOYEES ........................................................ 79
         Section 15.4      GOVERNING LAW ............................................................................ 79
         Section 15.5      GENDER AND PLURALS ....................................................................... 79
         Section 15.6      TITLES ................................................................................... 79
         Section 15.7      REFERENCES ............................................................................... 79
         Section 15.8      USE OF TRUST FUNDS ....................................................................... 79
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                           THE 2001 RESTATEMENT OF THE
            HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN

                  Harrah's Entertainment, Inc. (the "Company"), a Delaware
corporation, established the Harrah's Entertainment, Inc. Savings and Retirement
Plan (the "Plan") for the exclusive benefit of its eligible employees, effective
as of February 6, 1990. The Plan has been amended several times and is now
amended and restated in its entirety.

                  In connection with certain acquisitions, the Rio Suite Hotel &
Casino Employee Retirement Plan merged into the Plan effective January 3, 2000,
and certain accounts and assets of the Showboat, Inc. Retirement Savings Plan
merged into the Plan in 1999. Additionally, in connection with the Company's
acquisition of Harveys Casino & Resorts, Inc., the Company wishes to merge the
Harveys 401(k) Plan into the Plan, effective January 1, 2002.

                  In compliance with amendments to the Internal Revenue Code
mandated by the Uniformed Services Employment and Reemployment Rights Act of
1994, the Uruguay Round Agreements Act (GATT), the Small Business Job Protection
Act of 1996, the Taxpayer Relief Act of 1997, the Community Renewal Tax Relief
Act of 2000, the IRS Restructuring and Reform Act of 1998, and certain parts of
the Economic Growth and Tax Relief Reconciliation Act of 2001, to provide for
the merger of the Harveys 401(k) Plan into the Plan, to eliminate annuities as
an optional form of distribution and to make certain other changes, this
amendment and restatement to the Plan is hereby adopted. This amendment to the
Plan constitutes a complete amendment, restatement and continuation of the Plan.

                  In general, the provisions of this restatement are effective
as of January 1, 2002, except as otherwise provided in the Plan or required to
comply with applicable law. Except as otherwise specifically provided herein or
required by law, the provisions of this amended and restated Plan relating to
eligibility for participation, eligibility for benefits, amount of benefits,
manner of benefit payments and timing of benefit payments shall only apply to an
Employee who terminates employment on or after January 1, 2002. Any Employee who
terminated employment prior to January 1, 2002, shall have his eligibility for
benefits and the amount and form of benefits, if any, determined in accordance
with the provisions of the Plan in effect on the date his employment terminated
except as otherwise required by law or by this document.

                  The Plan is a profit-sharing plan with a cash or deferred
arrangement intended to comply with the provisions of Sections 401(a), 401(k)
and 401(m) of the Code.

                  The Plan is an "eligible individual account plan," as defined
in ERISA Section 407(d)(3), and provides for the acquisition and holding of
"qualifying employer securities," as defined in ERISA Section 407(d)(5).

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                                        ARTICLE I.
                                   DEFINITIONS

                  Section 1.1 GENERAL. Whenever any of the following terms is
used in the Plan with the first letter or letters capitalized, it shall have the
meaning specified below unless the context clearly indicates to the contrary.

                  Section 1.2 ACCOUNTS. "Accounts" means the following Accounts
which may be maintained under this Plan for a Participant:

                  (a)      401(K) ACCOUNT means the separate Account, if any,
maintained for each Participant to which shall be credited such Participant's
401(k) Contributions made pursuant to Section 3.3(a), related investment
earnings and loan repayments and from which shall be debited allocable expenses,
investment losses, loans, withdrawals and distributions.

                  (b)      AFTER TAX ACCOUNT means the separate Account, if any,
maintained for each Participant to which shall be credited such Participant's
After Tax Contributions made pursuant to Section 3.3(b), related investment
earnings and loan repayments and from which shall be debited allocable expenses,
investment losses, loans, withdrawals and distributions.

                  (c)      MATCHING ACCOUNT means the separate Account, if any,
maintained for each Participant to which shall be credited such Participant's
share of an Employer's Matching Contributions made pursuant to Section 3.4,
related investment earnings and loan repayments and from which shall be debited
allocable expenses, investment losses, loans, withdrawals and distributions.

                  (d)      ROLLOVER ACCOUNT means the separate Account, if any,
maintained for each Participant to which shall be credited such Participant's
Rollover Contributions made pursuant to Section 4.1, related investment earnings
and loan repayments and from which shall be debited allocable expenses,
investment losses, loans, withdrawals and distributions.

                  (e)      QUALIFIED ACCOUNT means the separate Account, if any,
maintained for each Participant to which shall be credited such Participant's
share of Qualified Nonelective Contributions and/or Qualified Matching
Contributions, related investment earnings and loan repayments and from which
shall be debited allocable expenses, investment losses, loans, withdrawals and
distributions.

                  (f)      PRIOR PLAN ACCOUNT means the separate Account, if
any, maintained for each Participant to which shall be credited such
Participant's share of contributions

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made pursuant to the provisions of the Harrah's Retirement Plan and the Holiday
Casino Profit Sharing Plan which had merged into the Holiday Corporation Savings
and Retirement Plan prior to February 6, 1990, related investment earnings and
loan repayments and from which shall be debited allocable expenses, investment
losses, loans, withdrawals and distributions.

                  (g)      MONEY PURCHASE ACCOUNT means the separate Account, if
any, maintained for each Participant to which shall be credited such
Participant's share of contributions made pursuant to the provisions of the
Holiday Inns, Inc. Employees' Retirement Plan and any other plan subject to the
provisions of Code Sections 401(a)(11)(B)(ii) and 417 which are transferred
directly to the Plan, related investment earnings and loan repayments and from
which shall be debited allocable expenses, investment losses, loans, withdrawals
and distributions.

In addition, such other Accounts may be established and maintained as the
Administrator may deem appropriate, such as, but not limited to, segregated
accounts, noninterest-bearing forfeiture accounts and the like.

                  Section 1.3 ACTIVE PARTICIPANT. "Active Participant" means a
Participant who is an Eligible Employee.

                  Section 1.4 ADMINISTRATIVE COMMITTEE. "Administrative
Committee", as described in Section 13.2, means the person or persons designated
by the Administrator to function in accordance with the Rules of the Plan.

                  Section 1.5 ADMINISTRATOR. "Administrator" means Harrah's
Operating Company Memphis, Inc., acting through such individuals or committees
it appoints.

                  Section 1.6 AFTER TAX CONTRIBUTION. "After Tax Contribution"
means an amount contributed by a Participant to the Plan under Section 3.3(b).

                  Section 1.7 ANNUAL ADDITION. "Annual Addition" of a
Participant for the Plan Year in question means the sum of

                  (a)      Company contributions, forfeitures, voluntary
after-tax contributions (excluding any excess amounts distributed to him
pursuant to Section 3.8) allocated to his Accounts under the Plan for that Plan
Year,

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                  (b)      401(k) Contributions allocated to his 401(k) Account
for that Plan Year (excluding any excess amounts which are distributed to him
pursuant to Section 3.5),

                  (c)      Company contributions, forfeitures and Participant
contributions allocated to his accounts under all other qualified defined
contribution plans, if any, of the Company and any Company Affiliate for that
Plan Year, and

                  (d)      Except for purposes of Section 3.8(a)(i), the sum of
any

                           (i)      Company contributions allocated to an
individual medical account (as defined in Code Section 415(l)(2)) which is
maintained under a qualified pension or annuity plan, and

                           (ii)     Company contributions allocated to the
separate account of a Key Employee (as defined in Section 12.1(b)(iii)) for the
purpose of providing post-retirement medical benefits.

                  If, in a particular Plan Year, the Company contributes an
amount to a Participant's Accounts because of an erroneous forfeiture in a prior
Plan Year or because of an erroneous failure to allocate amounts in a prior Plan
Year, the contribution shall not be considered an Annual Addition with respect
to the Participant for that particular Plan Year but shall be considered an
Annual Addition for the Plan Year to which it relates. If the amount so
contributed in the particular Plan Year takes into account actual investment
gains attributable to the period subsequent to the Plan Year to which the
contribution relates, the portion of the total contribution which consists of
such gains shall not be considered as an Annual Addition for any Plan Year.

                  Section 1.8 BENEFICIARY.

                  (a)      DEFINITION. "Beneficiary" means any person or entity
designated by a Participant in the form approved by the Administrator or its
delegate or agent to receive benefits payable as a result of the Participant's
participation in the Plan after the Participant's death.

                  (b)      SPECIAL RULE FOR MARRIED PARTICIPANTS. Each married
Participant will be deemed to have selected his Spouse as his Beneficiary unless
the Participant's Spouse has given Spousal Consent in the form provided by the
Administrator. Spousal Consent will not be required if the Participant states on
the applicable form provided for that purpose by the Administrator and notarized
that:

                           (i)      the Participant is able to establish to the
satisfaction of the Administrator that he has no Spouse; or

                           (ii)     the Participant's Spouse cannot be located;
or

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                           (iii)    there are other circumstances under which
consent of the Spouse is not required in accordance with applicable U.S.
Treasury or Department of Labor regulations.

                  (c)      SPECIAL RULE IF NO DESIGNATION IN EFFECT. If no valid
designation is in effect upon the death of the Participant or if the designated
Beneficiary has predeceased the Participant, the Beneficiary shall be the person
or persons who survives the Participant in the first of the following classes of
preferences:

                           (i)      Participant's surviving Spouse; if none then

                           (ii)     Participant's surviving children, including
adopted children, in equal shares, PER STIRPES (by right of representation); if
none then

                           (iii)    Participant's surviving parents; if none
then

                           (iv)     the executor or administrator of the
Participant's estate.

                  (d)      DISSOLUTION OF MARRIAGE. Upon the dissolution of
marriage of a Participant, any designation of the Participant's former Spouse as
a Beneficiary shall be treated as though the Participant's former Spouse had
predeceased the Participant unless (i) the Participant executes another
Beneficiary designation that complies with this Section and clearly names such
former Spouse as a Beneficiary, or (ii) a QDRO presented to the Administrator
prior to distribution being made on behalf of the Participant explicitly
requires the Participant to maintain the former Spouse as the Beneficiary. In
any case in which the Participant's former Spouse is treated under the
Participant's Beneficiary designation as having predeceased the Participant, no
heirs or other beneficiaries of the former Spouse shall receive benefits from
the Plan as a Beneficiary of the Participant except as provided otherwise in the
Participant's Beneficiary designation.

                  Section 1.9 BOARD. "Board" means the board of directors of
Harrah's Entertainment, Inc.

                  Section 1.10 BREAK IN SERVICE. "Break in Service" of an
Employee or former Employee means the twelve consecutive month period beginning
on the date of his first Hour of Service or any Plan Year beginning thereafter
during which he did not have more than 500 Hours of Service.

                  Section 1.11 CHIEF EXECUTIVE OFFICER. Chief Executive Officer"
means the Company's chief executive officer.

                  Section 1.12 CODE.

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                  "Code" means the Internal Revenue Code of 1986, as amended.

                  Section 1.13 COMPANY. "Company" means Harrah's Entertainment,
Inc. and any successor company which continues the Plan.

                  Section 1.14 COMPANY AFFILIATE. "Company Affiliate" means any
employer which, at the time of reference, was, with the Company, a member of a
controlled group of corporations or trades or businesses under common control,
or a member of an affiliated service group, as determined under regulations
issued by the Secretary of the Treasury or his delegate under Code Sections
414(b), (c), (m) and 415(h) and any other entity required to be aggregated with
the Company pursuant to regulations issued under Code Section 414(o).

                  Section 1.15 HARRAH'S STOCK. "Harrah's Stock" means shares of
common stock of the Company, par value $0.10 per share.

                  Section 1.16 COMPENSATION.

                  (a)      "Compensation" of a Participant for any Plan Year
means base pay, shift premiums, commissions and tips (including those earned
while on overtime) reported to the Employer for Federal withholding purposes
(but not exceeding tips actually received) paid during the Plan Year including
amounts excluded from taxable income by reason of Code Sections 125, 132(f)(4),
402(c)(3), 402(h) or 403(b). Compensation excludes overtime, bonuses, salary
continuation payments (except as provided below), any amount deferred under a
nonqualified deferred compensation plan, consulting payments and other forms of
additional remuneration. Notwithstanding the above, solely with respect to any
Employee who is placed on salary continuation status prior to August 1, 2001,
Compensation shall include salary continuation payments.

                  (b)      Solely for the purposes of Sections 1.18 (Deferral
Percentage) and 1.17 (Contribution Percentage), the Administrator may elect for
any Plan Year to exclude from Compensation amounts deferred under Section 3.3(a)
(under Code Section 401(k)) and under Code Section 125 (cafeteria plans) or to
apply any alternate definition of Compensation that satisfies the requirements
of Code Section 414(s) and the regulations thereunder.

                  (c)      Effective January 1, 2002, for all purposes of the
Plan, Compensation and Statutory Compensation in excess of $200,000 (as adjusted
for cost-of-living increases

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in accordance with Code Section 401(a)(17)(B)) shall be disregarded. For any
Plan Year beginning on January 1, 1994 but before January 1, 2002, for all
purposes of the Plan, Compensation and Statutory Compensation in excess of
$150,000 (adjusted for increases in the cost of living as described in Code
Section 401(a)(17)) shall be disregarded.

                  Section 1.17 CONTRIBUTION PERCENTAGE.

                  (a)      "Contribution Percentage" for a Plan Year means, with
respect to eligible Participants who are in the Highly Compensated Group and
eligible Participants who are in the Nonhighly Compensated Group, the average of
the individual percentages obtained, as to each Participant in such group, by
dividing:

                           (i)      the sum of (A) the amount of Matching
Contributions allocated to his Matching Account and the amount of After Tax
Contributions allocated to his After Tax Account for the Plan Year, (B) any
Qualified Nonelective Contributions or Qualified Matching Contributions for that
Plan Year (under Section 3.5(b) or 3.6(b)), and (C) allocations to his 401(k)
Account to the extent that the Administrator elects to take such allocations
into account, by

                           (ii)     his Statutory Compensation for that portion
of the Plan Year during which he was eligible to receive allocations to his
After Tax Account or Matching Account.

                  (b)      For purposes of this Section, all plans required to
be taken into account under Code Section 401(m)(2)(B) shall be treated as a
single plan.

                  (c)      The Administrator may elect to expand the Statutory
Compensation of a Participant taken into account for purposes of subsection
(a)(ii) to such amounts received by him for that entire Plan Years provided that
such determination is applied uniformly to all Participants for the year in
question.

                  Section 1.18 DEFERRAL PERCENTAGE.

                  (a)      "Deferral Percentage" for a Plan Year means, with
respect to eligible Participants who are in the Highly Compensated Group and
eligible Participants who are in the Nonhighly Compensated Group, the average of
the individual percentages obtained as to each Participant in such group, by
dividing:

                           (i)      the sum of (A) the amount, if any, credited
to his 401(k) Account for the Plan Year in question under this Plan and any
other plans which are aggregated with this Plan under Code Section 401(k)(3)(A)
(including any excess amounts described in Code Section 402(g) if he is a Highly
Compensated Employee but excluding any excess amounts distributed to him
pursuant to Section 3.8(b)) and (B) to the extent

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elected by the Administrator under Section 3.5(b), amounts credited to his
Qualified Account for that Plan Year, by

                           (ii)     his Statutory Compensation for that portion
of the Plan Year during which he was eligible to defer Compensation to his
401(k) Account.

                  (b)      The Administrator may elect to expand the Statutory
Compensation of a Participant taken into account for purposes of subsection
(a)(ii) to such amounts received by him for that entire Plan Year provided that
such determination is applied uniformly to all Participants for the year in
question.

                  Section 1.19 DIRECT ROLLOVER. "Direct Rollover" means a
payment by the Plan to an Eligible Retirement Plan designated by a Distributee.

                  Section 1.20    DISABILITY RETIREMENT. "Disability
Retirement" of a Participant means his Separation from the Service due to any
physical or mental injury or disease which causes him to be permanently
incapable of securing any gainful employment. Such disability shall be
established by certification to the Plan Administrator. Such certification shall
be by:

                  (a)      a physician selected by the Employee and approved by
the Plan Administrator;

                  (b)      three physicians, one selected by the Employee, one
selected by the Plan Administrator, and one selected by the physicians selected
by the Employee and Plan Administrator;

                  (c)      an award to receive Social Security disability
benefits; or

                  (d)      approval of waiver of premiums under the Employer's
group life insurance plan.

                  Section 1.21 DISABILITY RETIREMENT DATE. "Disability
Retirement Date" of a Participant means the date (prior to his Normal Retirement
Date) fixed by the Administrator for his Disability Retirement.

                  Section 1.22 DISTRIBUTEE. "Distributee" means a Participant,
Surviving Spouse or an alternate payee under a QDRO.

                  Section 1.23 EARLY RETIREMENT.

                                      -14-
<Page>

                  "Early Retirement" of an Active Participant means his
Separation from the Service (except by death) after his Early Retirement Date.

                  Section 1.24 EARLY RETIREMENT DATE. "Early Retirement Date"
means a Participant's 55th birthday.

                  Section 1.25 EFFECTIVE DATE. "Effective Date" means January 1,
2002, unless stated otherwise. In general, the provisions of this document only
apply to Participants who are Employees on or after the Effective Date. However,
investment and distribution provisions apply to all Participants with Account
balances to be invested or distributed after the Effective Date.

                  Section 1.26 ELIGIBLE EMPLOYEE. An "Eligible Employee" means
an Employee of an Employer other than:

                  (a)      an Employee whose employment with the Employer is
governed by a collective bargaining agreement that does not expressly provide
for Plan participation,

                  (b)      a non-resident alien with no U.S. source earned
income (as defined in Code Section 861(a)) who has not been approved by the
Administrator as eligible to participate.

                  Section 1.27 ELIGIBLE RETIREMENT PLAN. "Eligible Retirement
Plan" means

                  (a)      an individual retirement account (described in Code
Section 408(a)),

                  (b)      an individual retirement annuity (described in Code
Section 408(b)),

                  (c)      an annuity plan (described in Code Section 403(a))
and

                  (d)      a qualified trust (described in Code Section
402(c)(8)(A)).

Only for Plan Years beginning before January 1, 2002, an "Eligible Retirement
Plan" means only an individual retirement account or an individual retirement
annuity for a Distributee who is a Surviving Spouse.

                  Section 1.28 ELIGIBLE ROLLOVER DISTRIBUTION.

                  (a)      Except as provided in subsection (b), "Eligible
Rollover Distribution" means

                                      -15-
<Page>

any distribution of all or any portion of a Participant's Accounts to a
Distributee.

                  (b)      "Eligible Rollover Distribution" shall not mean any
distribution

                           (i)      that is one of a series of substantially
equal periodic payments (not less frequently than annually) made for the life
(or life expectancy) of the Distributee or the joint lives (or joint life
expectancies) of the Distributee and the Distributee's Beneficiary,

                           (ii)     that is paid for a specified period of ten
years or more,

                           (iii)    that is part of a series of distributions
during a calendar year to the extent that such distributions are expected to
total less than $200 or a total lump sum distribution which is equal to less
than $200, as described in Treas. Reg. Sec. 1.401(a)(31) - 1, Q&A11,

                           (iv)     effective January 1, 2002, for any
distribution that is made upon hardship of the Employee, and (B) effective for
the Plan Years commencing on January 1, 1999, January 1, 2000 and January 1,
2001, that is a hardship withdrawal (as defined in Code Section
401(k)(2)(B)(i)(IV)) consisting of elective deferrals under Code Section 401(k),

                           (v)      to the extent such distribution is required
under Code Section 401(a)(9) or

                           (vi)     to the extent such distribution is not
includible in gross income (determined without regard to the exclusion for net
unrealized appreciation with respect to employer securities).

                                      -16-
<Page>

                  Section 1.29 EMPLOYEE.

                  (a)      "Employee" means, except as provided below, any
person who renders services to the Company or a Company Affiliate in the status
of an "employee" as the term is defined in Code Section 3121(d). However, the
term does not include any person provided by a temporary agency or any person
whose services with the Company or Company Affiliate are performed pursuant to a
contract or other document (including any designation on a hire form or
personnel form) that purports to treat the individual as an independent
contractor or consultant even if such individual is later determined (by
judicial action or otherwise) to have been a common law employee of the Company
or Company Affiliate.

                  (b)      An Employee who, on or after August 1, 2001, is
placed on salary continuation or consulting status with pay following active
service as a full time Employee will not be considered an Employee during such
salary continuation or consulting status.

                  (c)      Except as provided in Section 1.39(b) (Hours of
Service) and Section 1.38 (Highly Compensated Employee), "Employee" shall not
include leased employees treated as Employees of the Company or a Company
Affiliate pursuant to Code Sections 414(n) and 414(o).

                  Section 1.30 EMPLOYER. "Employer" means the Company and any
Company Affiliate that adopts the Plan as a whole or with respect to any one or
more divisions in accordance with Section 14.5.

                  Section 1.31 ERISA. "ERISA" means the Employee Retirement
Income Security Act of 1974, as amended.

                  Section 1.32 401(K) CONTRIBUTION. "401(k) Contribution" of a
Participant means an amount contributed by his Employer to the Plan for him
under Section 3.3(a).

                  Section 1.33 FIVE PERCENT OWNER. "Five Percent Owner" means
any person who owns more than 5% of the Company or any Company Affiliate as
defined in Code Section 416.

                  Section 1.34 FORFEITURE BREAK IN SERVICE.

                                      -17-
<Page>

                  "Forfeiture Break in Service" means five consecutive one-year
Breaks in Service.

                  Section 1.35 FORFEITURE. "Forfeiture" means the portion of a
Participant's Accounts which is not vested in accordance with Section 7.1 based
on his Years of Vesting Service as of the date of his Separation from the
Service provided that no such Forfeiture shall be deemed to occur before the
earlier of

                  (a)      the date such Participant is deemed to receive a
distribution of the entire value of his vested Accounts or

                  (b)      the date such Participant incurs a Forfeiture Break
in Service.

                  Section 1.36 FORMER PARTICIPANT. "Former Participant" means a
former Active Participant who is not employed by the Company or any Company
Affiliate but who retains a Plan Account.

                  Section 1.37 HARDSHIP.

                  (a)      "Hardship" of a Participant as determined by the
Administrator in its discretion on the basis of all relevant facts and
circumstances and in accordance with the following nondiscriminatory and
objective standards, uniformly interpreted and consistently applied, and without
regard to the existence of other resources which are reasonably available to the
Participant, means any one or more of the following:

                           (i)      Unreimbursed expenses for medical care
described in Code Section 213(d) previously incurred by him, his Spouse, or his
dependent (as described in Code Section 152) or necessary for him, his Spouse or
his dependent to obtain medical care;

                           (ii)     Costs directly related to the purchase
(excluding mortgage payments) of a principal residence for him;

                           (iii)    Payment of tuition and related educational
fees for the next twelve months of post-secondary education for him, his Spouse,
children, or his dependents;

                           (iv)     Payments necessary to prevent his eviction
from his principal residence or foreclosure on the mortgage of his principal
residence; or

                           (v)      Any other event identified by the
Commissioner of Internal Revenue in revenue rulings, notices and/or other
documents of general applicability for inclusion in the foregoing list.

                                      -18-
<Page>

                  (b)      A financial need shall not fail to qualify as
immediate and heavy merely because such need was reasonably foreseeable by the
Participant or voluntarily incurred.

                  Section 1.38 HIGHLY COMPENSATED EMPLOYEE.

                  (a)      Effective January 1, 1997, for any current Plan Year,
a "Highly Compensated Employee" means any Employee who

                           (i)      in the previous Plan Year had Statutory
Compensation in excess of $80,000 (as adjusted), or

                           (ii)     was a Five Percent Owner at any time during
the previous Plan Year or the current Plan Year, or

                           (iii)    is a former Employee who during the Plan
Year in which he separated from the service or during any Plan Year ending on or
after his fifty-fifth birthday, was a highly compensated employee, as defined in
Code Section 414(q)(6) and the regulations thereunder.

                  (b)      For purposes of this Section, "Statutory
Compensation" shall include Compensation deferral amounts and other amounts
required to be taken into account pursuant to Code Section 414(q)(4), and
"Employee" shall include leased Employees treated as Employees of the Company
and Company Affiliates pursuant to Code Section 414(n) or 414(o).

                  (c)      Each Highly Compensated Employee is a member of the
"Highly Compensated Group."

                  (d)      Effective January 1, 1997, all references to family
aggregation are eliminated.

                  Section 1.39 HOUR OF SERVICE.

                  (a)      "Hour of Service" of an Employee (including a Leased
Employee) means the following:

                           (i)      Each hour for which he is paid or entitled
to payment by the Company or a Company Affiliate for the performance of
services.

                           (ii)     Each hour in or attributable to a period of
time during which he performs no duties (irrespective of whether he has had a
Separation from the Service) due to a vacation, holiday, illness, incapacity
(including disability), layoff, jury duty,

                                      -19-
<Page>

military duty or a leave of absence for which he is so paid or so entitled to
payment by the Company or a Company Affiliate, whether direct or indirect;
provided, however, that

                                    (A)      no more than 501 Hours of Service
shall be credited under this paragraph to an Employee on account of any such
period; and

                                    (B)      no such hours shall be credited to
an Employee if attributable to payments made or due under a plan maintained
solely for the purpose of complying with applicable workers' compensation,
unemployment compensation or disability insurance laws or to a payment which
solely reimburses the Employee for medical or medically related expenses
incurred by him.

                           (iii)    Each hour for which he is entitled to back
pay, irrespective of mitigation of damages, whether awarded or agreed to by the
Company or a Company Affiliate; provided, however, no more than 501 Hours of
Service shall be credited under this paragraph to an Employee on account of any
such period.

                  (b)      (i) Solely for the purposes of Section 1.10 (Break in
Service), an Hour of Service shall also include each hour in or attributable to
a Plan Year during which the Employee performs no duties for the Company or a
Company Affiliate (irrespective of whether he has had a Separation from the
Service) due to an absence from work

                                    (A)      by reason of pregnancy of the
Employee,

                                    (B)      by reason of the birth of a child
of the Employee,

                                    (C)      by reason of the placement of a
child with the Employee in connection with the adoption of such child by the
Employee, or

                                    (D)      for purposes of caring for such
child for a period beginning immediately following such birth or placement,

subject, however, to the provisions of paragraphs (ii), (iii) and (iv) below.

                           (ii)     The hours described in paragraph (i) are

                                    (A)      the Hours of Service which
otherwise would normally have been credited to the Employee but for such absence
or

                                    (B)      in any case in which the Plan is
unable to determine such hours, eight Hours of Service per day of such absence,

provided, however, that the total number of hours treated as Hours of Service
under paragraph (i) by reason of any such pregnancy or placement shall not
exceed 501.

                           (iii)    The hours described in paragraph (ii) shall
be treated as Hours of Service under paragraph (i)

                                      -20-
<Page>

                                    (A)      only in the Plan Year in which the
absence from work for such reason or purpose begins if the Employee would be
prevented from incurring a Break in Service in such Plan Year solely because of
the provisions of paragraphs (i) and (ii), or

                                    (B)      in any other case, in the
immediately following Plan Year.

                           (iv)     No credit for hours referred to in
paragraphs (i), (ii) and (iii) shall be given unless the Employee furnishes to
the Administrator such timely information as the Administrator may reasonably
require to establish

                                    (A)      that the absence from work is for a
reason or purpose referred to in paragraph (i), and

                                    (B)      the number of days for which there
was such an absence.

                  (c)      Hours of Service under subsections (a)(ii) and
(a)(iii) shall be calculated in accordance with 29 C.F.R. Section
2530.200b-2(b). Each Hour of Service shall be attributed to the Plan Year or
initial eligibility year in which it occurs except to the extent that the
Company, in accordance with 29 C.F.R. Section 2530.200b-2(c), credits such Hour
to another computation period under a reasonable method consistently applied.

                  (d)      For any salaried Employee who is exempt for purposes
of the Fair Labor Standards Act, Hours of Service shall be determined based on
the frequency of such Employee's payroll frequency. The following number of
Hours of Service shall be credits based on the appropriate payroll frequency:

<Table>
<Caption>
                      Units of time        Hours of Service
                      -------------        ----------------

<S>                                        <C>
                      day                  10 hours
                      week                 45 hours
                      semi-monthly               95 hours
                      monthly              190 hours
</Table>

                  Section 1.40 HRC. "HRC" means the Human Resources Committee of
the Board.

                  Section 1.41 INACTIVE PARTICIPANT. "Inactive Participant"
means an individual who is no longer an Eligible Employee, as described in
Section 2.2 but who retains a Plan Account.

                  Section 1.42 INVESTMENT COMMITTEE. "Investment Committee"
means the committee appointed by the Board

                                      -21-
<Page>

or the HRC to exercise the responsibilities set forth in Section 5.3.

                  Section 1.43 INVESTMENT FUND. "Investment Fund" means one of
the investment funds of the Trust Fund, including the option to invest in
Harrah's Stock, which is authorized by the Investment Committee at the time of
reference as provided in Article V. The Investment Funds to be offered to
Participants and Beneficiaries are set forth in Appendix A.

                  Section 1.44 LEASED EMPLOYEE. Effective January 1, 1997,
"Leased Employee" means any person (other than an employee of the recipient)
who, pursuant to an agreement between the recipient and any other person
("leasing organization"), has performed services for the recipient (or for the
recipient and related persons determined in accordance with Code Section
414(n)(6)) on a substantially full-time basis for a period of at least one year,
and such services are performed under the primary direction or control by the
recipient employer. Contributions or benefits provided a Leased Employee by the
leasing organization which are attributable to services performed for the
recipient employer shall be treated as provided by the recipient employer.

                  Section 1.45 LEVELING METHOD. "Leveling Method" means the
method of allocating the dollar amount of the excess contributions (within the
meaning of Treas. Reg. Sec. 1.401(k)-1(g)(7)) under Section 3.5 or excess
aggregate contributions (within the meaning of Treas. Reg. Sec. 1.
401(m)-1(f)(8)) under Section 3.6 as described in this Section. Under this
method, the total of excess contributions (or excess aggregate contributions) to
be distributed is allocated among the Highly Compensated Employees so that the
allocations described in Section 1.15(a) (or 1.14(a), as applicable) of the
Highly Compensated Employees with the highest dollar amount of such allocations
are reduced. This reduction will be accomplished so that either (a) the total of
such reductions (together with all prior reductions hereunder for the applicable
Plan Year) equals the total of such excess contributions (or excess aggregate
contributions) or (b) such Highly Compensated Employee's remaining such
allocations equals the allocations of the Highly Compensated Employee with the
next highest dollar amount of such allocations. This process is repeated with
respect to the applicable Highly Compensated Employees until the total of such
reductions attributable to all such Highly Compensated Employees is equal to the
total of such excess contributions (or excess aggregate contributions).

                  Section 1.46 MATCH ENTRY DATE. "Match Entry Date" means the
January 1st or July 1st on or after the date an Eligible Employee becomes
eligible for a Matching Contribution.

                                      -22-
<Page>

                  Section 1.47 MATCHING CONTRIBUTION. "Matching Contribution" of
a Participant means the amount contributed by his Employer to the Plan for him
under Section 3.4.

                  Section 1.48 MILITARY LEAVE. Any Employee who leaves the
Company or a Company Affiliate directly to perform service in the Armed Forces
of the United States or in the United States Public Health Service under
conditions entitling him to reemployment rights, as provided in the laws of the
United States, shall, solely for purposes of the Plan and irrespective of
whether he is compensated by the Company or a Company Affiliate during such
period of service, be on Military Leave. An Employee's Military Leave shall
expire if such Employee voluntarily resigns from the Company or such Company
Affiliate during such period of service or if he fails to make application for
reemployment within the period specified by such laws for the preservation of
his reemployment rights.

                  Section 1.49 NONHIGHLY COMPENSATED EMPLOYEE. "Nonhighly
Compensated Employee" means for a Plan Year each Employee of the Company or a
Company Affiliate who is not a Highly Compensated Employee as determined under
Code Section 414(q). Each Nonhighly Compensated Employee is a member of the
"Nonhighly Compensated Group."

                  Section 1.50 NORMAL RETIREMENT. "Normal Retirement" of an
Active Participant means his Separation from the Service (except by death) on or
after his Normal Retirement Date.

                  Section 1.51 NORMAL RETIREMENT DATE. "Normal Retirement Date"
means a Participant's 65th birthday.

                  Section 1.52 PARTICIPANT. "Participant" means an Employee or
former Employee who is participating or has participated in the Plan and who has
one or more Accounts under the Plan. Participants are further differentiated as
Active Participants, Inactive Participants and Former Participants.

                  Section 1.53 PAYDAY. "Payday" of a Participant means the
regular and recurring established day for payment of Compensation to Employees
in his classification or position.

                  Section 1.54 PLAN.

                                      -23-
<Page>

                  "Plan" means Harrah's Entertainment, Inc. Savings and
Retirement Plan.

                  Section 1.55 PLAN REPRESENTATIVE. "Plan Representative" means
any person or persons designated by the Administrator to function in accordance
with the Rules of the Plan.

                  Section 1.56 PLAN YEAR. "Plan Year" means the calendar year.

                  Section 1.57 QDRO. "QDRO" means a qualified domestic relations
order as defined in Code Section 414(p).

                  Section 1.58 QUALIFIED MATCHING CONTRIBUTION. "Qualified
Matching Contribution" means the additional Company contribution made to satisfy
the requirements of Section 3.6(a) and Code Section 401(a)(4), as described in
Treas.Reg.Sec. 1.401(m)-1(b)(5).

                  Section 1.59 QUALIFIED NONELECTIVE CONTRIBUTION. "Qualified
Nonelective Contribution" means the additional Company contribution made to
satisfy the requirements of Section 3.5 and Code Section 401(a)(4), as described
in Treas.Reg.Sec. 1.401(k)-1(b)(5).

                  Section 1.60 RULES OF THE PLAN. "Rules of the Plan" means the
rules adopted by the Administrator for the administration, interpretation or
application of the Plan.

                  Section 1.61 SEPARATION FROM THE SERVICE.

                  (a)      "Separation from the Service" means an Employee's
resignation from or discharge by the Company or a Company Affiliate, death,
Normal Retirement or Disability Retirement but not his transfer of employment
among the Company and Company Affiliates.

                  (b)      A leave of absence or sick leave authorized by the
Company or a Company Affiliate in accordance with established policies, a
vacation period, a temporary layoff for lack of work or a Military Leave shall
not constitute a Separation from the Service; provided, however, that

                                      -24-
<Page>

                           (i)      continuation upon a temporary layoff for
lack of work for a period in excess of twelve months shall be considered a
discharge effective as of the commencement of the twelfth month of such period,
and

                           (ii)     failure to return to work upon expiration of
any leave of absence, sick leave, or vacation or within three days after recall
from a temporary layoff for lack of work, or before expiration of a Military
Leave shall be considered a resignation effective as of the commencement of any
such leave of absence, sick leave, vacation, temporary layoff or Military Leave.

                  Section 1.62 SPOUSAL CONSENT. "Spousal Consent" to an
election, designation or other action of a Participant means the written consent
of the Spouse of the Participant, witnessed by a Plan Representative or a notary
public, which acknowledges the effect of such election on the rights of the
Spouse. In the case of consent to a Beneficiary designation, it also
acknowledges that such designation cannot be changed without further Spousal
Consent unless the Spousal Consent expressly permits such changes without the
necessity of additional Spousal Consent. Spousal Consent shall be deemed to have
been obtained if it is established to the satisfaction of the Plan
Representative that it cannot actually be obtained because there is no Spouse,
or because the Spouse could not be located, or because of such other
circumstances as the Secretary of the Treasury by regulation may prescribe. Any
Spousal Consent shall be effective only with respect to the Spouse who provided
it.

                  Section 1.63 SPOUSE; SURVIVING SPOUSE. "Spouse" or "Surviving
Spouse" of a Participant means the spouse to whom he was married on the relevant
date. However, to the extent required by a qualified domestic relations order
issued in accordance with Code Section 414(p), a former Spouse shall be treated
as a Surviving Spouse.

                  Section 1.64 STATUTORY COMPENSATION. "Statutory Compensation"
of a Participant for any Plan Year means his wages and all other payments of
compensation to him by the Company or Company Affiliate (in the course of its
trade or business) as reported on Form W-2 and as described Treasury Regulations
Section 1.415-2(d)(11)(i), but including amounts excluded from taxable income by
reason of Code Sections 125, 132(f)4, 402(c)(3), 402(h) or 403(b).

                  Section 1.65 TRUST AGREEMENT. "Trust Agreement" means the
agreement between the Company and the Trustee under which Trust Fund assets are
held and invested.

                                      -25-
<Page>

                  Section 1.66 TRUST FUND. "Trust Fund" means the fund
established under the Trust Agreement by contributions made by the Employers and
Participants, pursuant to the Plan and from which any distributions under the
Plan are to be made.

                  Section 1.67 TRUSTEE. "Trustee" means State Street Bank and
Trust Company, and any successor trustee or trustees of the Trust Fund under the
Trust Agreement.

                  Section 1.68 VALUATION DATE. "Valuation Date" means each day
the U.S. stock markets are open for business.

                  Section 1.69 YEAR OF ELIGIBILITY SERVICE.

                  (a)      "Year of Eligibility Service" means the number of
years, including fractional periods, elapsed from the Employee's first Hour of
Service until the date of his termination of employment with all Company
Affiliates. If a Employee is absent from employment with the Employer and all
Company Affiliates for any reason other than resignation, dismissal, retirement
or death, the Employee will be considered to have terminated employment on the
earlier of (1) the date he resigns or is dismissed or (2) the first anniversary
of the first date of such absence.

                  (b)      Under the service spanning rules, a Participant will
be credited with service under subparagraph (a) for any "period of severance"
(as defined below) that is 12 months or less if the Employee again is credited
with an Hour of Service with an Employer or a Company Affiliate within the 12
consecutive month period beginning on the date of his termination of employment
(as described in (a) or in this paragraph, as applicable). For this purpose, a
"period of severance" is the period commencing on the date of the Employee's
termination of employment with the Employer and all Company Affiliates and
ending on the date the Employee is next credited with an Hour of Service with an
Employer or any Company Affiliate. For purposes of the service spanning rule, if
an Employee is no longer performing services because of a maternity or paternity
absence, then the Employee shall be considered to have terminated employment on
the second anniversary of the first date of such absence. A maternity or
paternity absence

                                      -26-
<Page>

is an absence on account of the birth of a child of the Employee, the placement
of a child with the Employee in connection with the adoption of such child by
such Employee, or the caring for such child for a period beginning immediately
following such birth or placement.

                  (c)      An Employee's service with an Company Affiliate that
occurred prior to the acquisition of such Company Affiliate by the Company or
another Company Affiliate shall be counted under the Plan to the extent this
information is reasonably available to the Administrator.

                  Section 1.70 YEAR OF VESTING SERVICE. "Year of Vesting
Service" means a Plan Year during which an Employee is credited with at least
1,000 Hours of Service, subject to the following rules:

                  (a)      Plan Years following a Forfeiture Break in Service
shall be disregarded for purposes of determining the Participant's vested
percentage of his Account prior to the Forfeiture Break in Service.

                  (b)      In the case of a Participant who is not entitled to
any vested percentage of his Account at the time he incurs a Forfeiture Break in
Service, Plan Years prior to such Forfeiture Break in Service shall be
disregarded in calculating the number of the Participant's Years of Vesting
Service for purposes of determining the vested percentage of his Matching
Account after such Forfeiture Break in Service if the number of the
Participant's consecutive one year Breaks in Service equals or exceeds the
number of the Participant's Years of Vesting Service prior to the Forfeiture
Break in Service.

                  (c)      For purposes of determining an Employee's Years of
Vesting Service, a Leased Employee or contract employee of the Company or any
Company Affiliate who is subsequently hired as an Employee will be credited with
service from the date he was originally retained as a Leased Employee or
contract employee, except to the extent such prior service occurred prior to the
date the individual, had he been an Employee, would have had a Forfeiture Break
in Service.

                  (d)      Years of Vesting Service credited under any qualified
plan that has merged into the Plan will be counted under the Plan to the extent
this information is reasonably available to the Administrator.

                  (e)      An Employee's service with an Company Affiliate that
occurred prior to the acquisition of such Company Affiliate by the Company or
another Company Affiliate shall be counted under the Plan to the extent this
information is reasonably available to the Administrator.

                                      -27-
<Page>

                                        ARTICLE II.
                                   ELIGIBILITY

                  Section 2.1 REQUIREMENTS FOR PARTICIPATION.

                  (a)      Effective January 1, 1999, except as provided in
subsections (c) and (d), each Eligible Employee shall be eligible to participate
in the Plan by making 401(k) Contributions and After Tax Contributions as soon
as practicable following the 90th day after his date of hire.

                  (b)      Effective January 1, 1999, an Eligible Employee will
become eligible for a Matching Contribution on the Match Entry Date on or
following the date he completes one Year of Eligibility Service.

                  (c)      Any Participant whose participation under Section
2.1(a) and/or 2.1(b) terminates may again begin participating as soon as
practicable following his first subsequent Hour of Service as an Eligible
Employee.

                  (d)      A former Employee who was not an Eligible Employee on
the date on which he first met all other eligibility requirements under Section
2.1(a) and/or 2.1(b) may begin participating as soon as practicable following
his first subsequent Hour of Service as an Eligible Employee.

                  (e)      Each Participant shall enroll in the Plan as
described in the Rules of the Plan.

                  Section 2.2 INACTIVE STATUS.

                  (a)      An Active Participant who transferred directly to a
different position or classification at the Company or a Company Affiliate and
is no longer an Eligible Employee shall immediately cease to be an Active
Participant and shall become an Inactive Participant.

                  (b)      All provisions of the Plan shall otherwise continue
to apply to an Inactive Participant except that he shall not make 401(k)
Contributions or After Tax Contributions, share in the Matching Contributions,
Qualified Nonelective Contributions or Qualified Matching Contributions or share
in allocations under Section 3.8 while he is an Inactive Participant.

                  (c)      If an Inactive Participant is retransferred to a
position or classification with

                                      -28-
<Page>

an Employer as an Eligible Employee, he shall immediately become an Active
Participant, may again make 401(k) Contributions and After Tax Contributions,
share in the Matching Contributions, Qualified Nonelective Contributions and
Qualified Matching Contributions or share in allocations under Section 3.8.

                  Section 2.3 FORMER PARTICIPANTS.

                  (a)      An Active or Inactive Participant who ceases to be an
Employee of the Company or a Company Affiliate shall immediately become a Former
Participant.

                  (b)      All provisions of the Plan shall otherwise continue
to apply to a Former Participant except that he shall not make 401(k)
Contributions or After Tax Contributions, or be entitled to Matching
Contributions, Qualified Nonelective Contributions or Qualified Matching
Contributions or share in allocations under Section 3.8 while he is a Former
Participant.

                                      -29-
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                                       ARTICLE III.
                                  CONTRIBUTIONS

                  Section 3.1 CONTRIBUTIONS IN GENERAL. Contributions are to be
made to the Trust by the Employers and may be made by the Participants as
provided in the Plan. The Trustee shall have no duty to require any
contributions to be made to it or to determine whether contributions delivered
to it hereunder comply with the provisions of this Plan or any resolutions,
rules, regulations or policies of the Company providing for such contributions.

                  Section 3.2 MAXIMUM ANNUAL CONTRIBUTION. Except for
contributions described in Section 13.12, the Employers' contribution for any
Plan Year shall not exceed the maximum amount deductible by the Employers for
any taxable year ending with or within such Plan Year under Code Section
404(a)(3)(A).

                  Section 3.3 PARTICIPANT CONTRIBUTIONS.

                  (a)      401(K) CONTRIBUTIONS.

                           (i)      Each Active Participant who enters into a
payroll reduction agreement may elect, in accordance with the Rules of the Plan,
to contribute a 401(k) Contribution by payroll reduction in an amount equal to a
designated whole percentage of his Compensation within the minimum and maximum
limits established by the Administrator from time to time and recorded on
Appendix A. Additionally, the maximum amount of Compensation that may be
designated as a 401(k) Contribution is subject to any combined limit on both
401(k) and After Tax Contributions set by the Administrator.

                           (ii)     The Participant's payroll reduction
agreement shall be in any form acceptable to the Administrator (including
internet, intranet, telephonic or other methods). The amount designated as a
401(k) Contribution shall be deducted for each Payday in such Plan Year in which
it is in effect. Deductions shall be effective on the first Payday on which it
is administratively feasible to commence such deductions. Participants'
elections will automatically apply to increases or decreases in Compensation.

                           (iii)    In no event shall the aggregate of such
deferrals under this Section for any calendar year exceed the annual limit under
Code Section 402(g) as adjusted by the Secretary of the Treasury for that
calendar year.

                           (iv)     The Administrator may authorize a suspension
or reduction of

                                      -30-
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401(k) Contributions as it deems necessary to satisfy Section 3.5.

                                      -31-
<Page>

                  (b)      AFTER TAX CONTRIBUTIONS.

                           (i)      Each Active Participant who enters into a
payroll reduction agreement may elect, in accordance with the Rules of the Plan,
to contribute an After Tax Contribution by payroll reduction in an amount equal
to a designated whole percentage of his Compensation within the minimum and
maximum limits established by the Administrator from time to time and recorded
on Appendix A. Additionally, the maximum amount of Compensation that may be
designated as either a 401(k) Contribution or an After Tax Contribution is
subject to the limits set by the Administrator.

                           (ii)     The Participant's payroll reduction
agreement shall be in any form acceptable to the Administrator (including
internet, intranet, telephonic or other methods). The amount designated as an
After Tax Contribution shall be deducted for each Payday in such Plan Year in
which it is in effect. Deductions shall be effective on the first Payday on
which it is administratively feasible to commence such deductions. Participants'
elections will automatically apply to increases or decreases in Compensation.

                           (iii)    The Administrator may authorize a suspension
or reduction of After Tax Contributions as it deems necessary to satisfy Section
3.6.

                  (c)      COMMENCEMENT, RESUMPTION OR CHANGE OF PARTICIPANT
CONTRIBUTIONS. As permitted under the Rules of the Plan:

                           (i)      A Participant may increase, decrease or
completely discontinue his 401(k) Contributions and/or After Tax Contributions
made pursuant to this Section in the frequency and manner determined by the
Administrator (including internet, intranet, telephonic or other methods).

                           (ii)     A Participant who has discontinued his
401(k) Contributions and After Tax Contributions may recommence making them in
the frequency and manner determined by the Administrator (including internet,
intranet, telephonic or other methods).

                           (iii)    Notwithstanding the foregoing, all 401(k)
Contributions and After Tax Contributions shall automatically cease as of the
date on which the Participant ceases to be an Eligible Employee.

                  (d)      DEPOSIT IN TRUST. Each Participant's 401(k)
Contributions and After Tax Contributions shall be transmitted to the Trustee as
of the earliest date on which such contributions can reasonably be segregated
from the Employers' assets after the end of each Payday but in no event more
than 15 business days after the end of the month in

                                      -32-
<Page>

which they were withheld.

                  (e)      ALLOCATION OF PARTICIPANT CONTRIBUTIONS. In
accordance with Article VI, each Participant's 401(k) Contributions shall be
credited to his 401(k) Account, and each Participant's After Tax Contributions
shall be credited to his After Tax Account.

                  (f)      VESTING OF 401(K) AND AFTER TAX ACCOUNTS. A
Participant shall always be 100% vested in his 401(k) Account and After Tax
Account.

                  (g)      RETURN OF EXCESS DEFERRED COMPENSATION. If a
Participant makes deferrals to this Plan and any other cash or deferred
arrangement for a calendar year which exceed the limit under Code Section 402(g)
for such year, the Participant shall notify the Administrator of the amount of
such excess deferrals made under this Plan by the March 1 of the next calendar
year. The amount of such excess deferrals (and any income thereon earned to the
earlier of the date of distribution or the last day of the Plan Year in which
such contribution was made computed in a consistent and reasonable manner in
accordance with Code Section 401(a)(4)) shall be distributed to the Participant
by the April 15 of the next calendar year. If a Participant has made excess
deferrals to this Plan the Participant shall be deemed to have given the notice
referred to above, and the excess contributions (and any income thereon) shall
be distributed to the Participant by such April 15. Any such distribution shall
not be subject to any Spousal Consent, nor shall it be treated as a withdrawal
or distribution subject to the provisions of Article VIII or XI.

                  Section 3.4 MATCHING CONTRIBUTIONS.

                  (a)      AMOUNT.

                           (i)      FIXED MATCHING CONTRIBUTION. The Employers
shall contribute, on behalf of each Participant who satisfies Section 2.1(b) and
makes 401(k) Contributions and/or After Tax Contributions during the Plan Year,
an amount equal to 100% of the first 6% of Compensation contributed under
Section 3.3 either as 401(k) Contributions and/or After Tax Contributions.

                           (ii)     DISCRETIONARY MATCHING CONTRIBUTION. On
behalf of each Participant who satisfies Section 2.1(b) and makes 401(k)
Contributions and/or After Tax Contributions during a Plan Year and is employed
by an Employer as an Eligible Employee on the last day of the Plan Year, the
Employers may contribute to the Plan an amount to be determined at the
discretion of the HRC.

                  (b)      ALLOCATION TO MATCHING ACCOUNT. All Matching
Contributions will be credited to the Participant's Matching Account in
accordance with Article VI.

                  (c)      DEPOSIT IN TRUST.

                                      -33-
<Page>

                           (i)      The fixed Matching Contributions described
in Section 3.4(a)(i) will typically be transmitted to the Trustee in cash or
Harrah's stock (as determined by the Company in its sole discretion) to be held
in the Trust Fund as soon as practicable following the end of each month.
However, all Matching Contributions will be transmitted to the Trustee to be
held in the Trust Fund no later than the date upon which the Company's federal
income tax return is due (including extensions thereof) for its taxable year
coinciding with the Plan Year in question.

                           (ii)     If the Company makes a contribution after
the end of the Plan Year for which the contribution is made

                                    (A)      the Company shall notify the
Trustee in writing that the contribution is made for such Plan Year,

                                    (B)      the Company shall claim such
payment as a deduction on its federal income tax return for its taxable year
coinciding with such Plan Year, and

                                    (C)      the Administrator and the Trustee
shall treat the payment as a contribution by the Company to the Trust actually
made on the last day of such taxable year.

                  Section 3.5 LIMITATION ON 401(K) CONTRIBUTIONS. Effective
January 1, 1997, each Plan Year the Plan must satisfy the requirements of this
Section and Section 3.6 and, prior to January 1, 2002, Section 3.7. The
Administrator shall determine if these requirements are satisfied pursuant to
Treas. Reg. Sec. 1.401(k)-1 and subsequent Internal Revenue Service guidance
issued under the applicable provisions of the Code, the provisions of which are
incorporated by reference.

                  (a)      ACTUAL DEFERRAL PERCENTAGE TEST. For each Plan Year,
the Deferral Percentage of the Highly Compensated Group shall be

                           (i)      not more than 125 percent of, or

                           (ii)     not more than two percentage points higher
than, and not more than twice,

the Deferral Percentage for such Plan Year of the Nonhighly Compensated Group
for the current Plan Year (the "Current Year Testing Method"), or such other
amount as may be required by Treasury regulations under Code Section 401(m)(9).

         Instead of applying the Current Year Testing Method, the Administrator
may elect to apply the Deferral Percentage for the Nonhighly Compensated Group
for the prior Plan Year ("Prior Year Testing Method") as permitted by Internal
Revenue Service Notice 98-1 (or any successor thereto, subject to any required
approval by the Internal

                                      -34-
<Page>

Revenue Service). If the Administrator makes this election, the Prior Year
Testing Method will apply for all subsequent Plan Years (until changed by the
Administrator) and will be set forth in an exhibit to the Plan.

                  (b)      ADJUSTMENTS TO SATISFY NONDISCRIMINATION
REQUIREMENTS. In order to achieve the result described in subsection (a), the
following actions shall be taken, as provided under Code Section 401(k), the
regulations thereunder and the Rules of the Plan, in the order selected by the
Administrator and to the extent necessary:

                           (i)      The Administrator shall make the election
provided in Section 1.16(b) (Compensation).

                           (ii)     Amounts otherwise to be credited under
Section 3.4 to Matching Accounts for such Plan Year shall be credited instead to
Qualified Accounts of the Participants in question.

                           (iii)    To the extent permitted by Code Section
401(a)(4) and Treas. Reg. Sec. 1.401(k)-1(b)(5) (which are incorporated herein
by this reference), the Company may make Qualified Nonelective Contribution to
the Qualified Accounts of select Participants. Such Qualified Nonelective
Contribution shall be allocated to Participants in inverse order of Compensation
received in the Plan Year in question (so the lowest compensated Participant
receives the first allocation) with each Participant who receives an allocation
receiving the maximum allocation permitted by Code Section 415 before any
Participant with greater Compensation receives any allocation, until such
contribution is fully allocated.

                           (iv)     Prior to the end of the following Plan Year,
the amount of excess contributions within the meaning of Treas. Reg. Sec.
1.401(k)-1(g)(7) (and any income thereon earned to the earlier of the date of
distribution or the last day of the Plan Year in which such contribution was
made computed in a consistent and reasonable manner in accordance with Section
5.1 and Code Section 401(a)(4)) for Participants who were Highly Compensated
Employees for the Plan Year shall be allocated according to the Leveling Method
and distributed to the Highly Compensated Employees in question. Such
distribution shall not be subject to any Spousal Consent requirements or treated
as a withdrawal or distribution subject to Article VIII or XI.

                  (c)      ORDERING RULE. The amount of any distributions under
subsection (b) shall be determined after the maximum deferrals have been made
under Section 3.3(a) and the distribution of such deferrals pursuant to Section
3.3(g).

                  Section 3.6 LIMITATION ON MATCHING AND AFTER TAX
CONTRIBUTIONS. Effective January 1, 1997, each Plan Year the Plan must satisfy
the requirements of this Section and Section 3.5 and, prior to January 1, 2002,
Section 3.7. The Administrator shall determine if these requirements are
satisfied pursuant to Treas. Reg. Sec. 1.401(m)-1 and subsequent Internal
Revenue Service guidance issued under

                                      -35-
<Page>

the applicable provisions of the Code, the provisions of which are incorporated
by reference.

                  (a)      ACTUAL CONTRIBUTION PERCENTAGE TEST. For each Plan
Year, the Contribution Percentage of the Highly Compensated Group, shall be

                           (i)      not more than 125 percent of, or

                           (ii)     to the extent allowed by regulations under
Code Section 401(m)(9)) not more than two percentage points higher than, and not
more than twice,

the Contribution Percentage for such Plan Year of Nonhighly Compensated
Participants for the current Plan Year (the "Current Year Testing Method"), or
such other amount as may be required by Treasury regulations under Code Section
401(m)(9).

         Instead of applying the Current Year Testing Method, the Administrator
may elect to apply the Contribution Percentage for the Nonhighly Compensated
Group for the prior Plan Year ("Prior Year Testing Method") as permitted by
Internal Revenue Service Notice 98-1 (or any successor thereto, subject to any
required approval by the Internal Revenue Service). If the Administrator makes
this election, the Prior Year Testing Method will apply for all subsequent Plan
Years (until changed by the Administrator) and will be set forth in an exhibit
to the Plan.

                  (b)      ADJUSTMENTS TO SATISFY NONDISCRIMINATION
REQUIREMENTS. In order to achieve the result described in subsection (a), as of
the end of each Plan Year, the Administrator shall take or cause to be taken any
of the following actions, in the order selected by the Administrator (but after
application of Section 3.5) and to the extent necessary:

                           (i)      The Administrator shall make the election
provided in Section 1.16(b) (Compensation).

                           (ii)     Allocations to 401(k) Accounts shall be
taken into account for purposes of calculating the Contribution Percentage.

                           (iii)    Allocations to Matching Accounts that are
not vested will be forfeited.

                           (iv)     To the extent permitted by Code Section
401(a)(4) and Treas. Reg. Sec. 1.401(m)-1(b)(5) (which are incorporated herein
by this reference), the Company may make Qualified Matching Contribution to the
Qualified Accounts of select Participants. Such Qualified Matching Contribution
shall be allocated to Participants in inverse order of Compensation received in
the Plan Year in question (so the lowest compensated Participant receives the
first allocation) with each Participant who receives an allocation receiving the
maximum allocation permitted by Code Section 415 before

                                      -36-
<Page>

any Participant with greater Compensation receives any allocation, until such
contribution is fully allocated.

                           (v)      Prior to the end of the following Plan Year,
the amount of excess aggregate contributions within the meaning of Treas. Reg.
Sec. 1.401(m)-1(f)(8) (and any income thereon earned to the earlier of the date
of distribution or the last day of the Plan Year in which such contribution was
made computed in a consistent and reasonable manner in accordance with Section
5.1 and Code Section 401(a)(4)) for Participants who were Highly Compensated
Employees for the Plan Year shall be allocated according to the Leveling Method.
In conformity with Treas. Reg. Sec. 1.401(m)-1(e)(4)), this amount shall then be
distributed to the Highly Compensated Employees in question. Amounts distributed
under the foregoing shall not be subject to Spousal Consent requirements or
treated as a withdrawal or distribution under Article VIII or XI.

                  Section 3.7 ALTERNATIVE USE LIMITATION TEST. Only for Plan
Years beginning prior to January 1, 2002, in addition to the requirements of
Sections 3.5 and 3.6 for any Plan Year, the Plan must satisfy the requirements
of this Section.

                  (a)      MULTIPLE USE TEST. The sum of the Deferral Percentage
and the Contribution Percentage of the Highly Compensated Group for the Plan
Year may not exceed the greater of:

                           (i)      The sum of

                                    (A)      1.25 times the greater of

                                            (I)      the Deferral Percentage of
                                                     the Nonhighly Compensated
                                                     Group for the current Plan
                                                     Year; or

                                            (II)     the Contribution Percentage
                                                     of the Nonhighly
                                                     Compensated Group for the
                                                     current Plan Year; and

                                    (B)      two percentage points plus the
lesser of (I) or (II) next above, but in no event in excess of twice the lesser
of (I) or (II) above; or

                           (ii)     The sum of:

                                    (A)      1.25 times the lesser of:

                                    (B)

                                      -37-
<Page>

                                            (I)      the Deferral Percentage of
                                                     the Nonhighly Compensated
                                                     Group for the current Plan
                                                     Year; or

                                            (II)     the Contribution Percentage
                                                     of the Nonhighly
                                                     Compensated Group for the
                                                     current Plan Year; and

                                    (C)      two percentage points plus the
lesser of (I) or (II) next above, but in no event in excess of twice the lesser
of (I) or (II) above.

                  (b)      ADJUSTMENTS. If the requirements of subsection (a)
are not satisfied, the amount of such excess will be an excess contribution or
excess aggregate contribution, as determined in the discretion of the
Administrator, and the corresponding contribution will be reduced and
distributed to Highly Compensated Employees in the manner described in the
applicable provisions of Sections 3.5 and 3.6. The Deferral Percentage and the
Contribution Percentage of the Highly Compensated Group will be determined after
any corrective distributions of excess contributions or excess aggregate
contributions under Sections 3.5 and 3.6.

                  Section 3.8 LIMITATION ON ANNUAL ADDITIONS; TREATMENT OF
OTHERWISE EXCESSIVE ALLOCATIONS.

                  (a)      ANNUAL ADDITION LIMITATION. In any Plan Year (which
shall be the Plan's "limitation year" within the meaning of Treas. Reg. Sec.
1.415-2(b)), the Annual Addition of a Participant shall not:

                           (i)      effective for limitation years beginning on
or after January 1, 2002, exceed the lesser of

                                    (A)      $40,000 (as adjusted), or

                                    (B)      100% of such Participant's
Statutory Compensation for such Plan Year.

                           (ii)     effective for limitation years beginning
prior to January 1, 2002, exceed the lesser of

                                    (A)      $30,000 (as adjusted), or

                                    (B)      25% of such Participant's Statutory
Compensation for such Plan Year.

                  (b)      ADJUSTMENTS. If the Annual Addition of a Participant
would exceed the limits of subsection (a) as a result of an allocation of
forfeitures, a reasonable error in

                                      -38-
<Page>

estimating a Participant's Statutory Compensation, a reasonable error in
determining the amount of a Participant's elective deferrals or under other
limited facts and circumstances found justifiable by the Commissioner of
Internal Revenue, the Administrator shall, to the extent necessary to eliminate
such excess (and in the following order):

                           (i)      refund or refuse to accept all or any part
of a Participant's After Tax Contributions to be allocated to his After Tax
Account in the limitation year that are ineligible for a Matching Contribution;

                           (ii)     refund or refuse to accept any part or all
of the Participant's 401(k) Contributions to be allocated to his 401(k) Account
in the Limitation Year that are ineligible for a Matching Contribution;

                           (iii)    refund or refuse to accept any part or all
of the Participant's After Tax Contributions to be allocated to his After Tax
Account in the Limitation Year that are eligible for a Matching Contribution and
reduce the corresponding Matching Contribution;

                           (iv)     refund or refuse to accept any part or all
of the Participant's 401(k) Contributions to be allocated to his 401(k) Account
in the Limitation Year that are eligible for a Matching Contribution and reduce
the corresponding Matching Contribution; and/or

                           (v)      reduce his allocation of Employer
contributions for such Plan Year to his Qualified Account.

                  (c)      TREATMENT OF EXCESSIVE ALLOCATIONS. Excess amounts
attributable to Employer contributions will be held in a suspense account and
recontributed for the applicable Account of the Participant in the first Plan
Year in which allowed under subsection (a) or otherwise held in suspense
hereunder and applied to the applicable Account of the Participant in the first
Plan Year in which allowed under subsection (a). The balance, if any, of such
reduction shall be allocated to the Matching Accounts of persons who are Active
Participants at the end of the Plan Year in proportion to their Compensation
received while Active Participants in such Plan Year. If any Participant's
Annual Addition would, due to such special allocation, exceed the limit of
subsection (a), the excess shall be reallocated by a second special allocation,
and so on as necessary to allocate such amounts within the limits of subsection
(a). Any amounts which cannot be so allocated because of the limitations of
subsection (a), shall be held in suspense and shall be allocated and reallocated
in succeeding Plan Years, in the order of time, prior to the allocation of any
Employee contributions.

                  (d)      EXCESSIVE ALLOCATIONS UPON PLAN TERMINATION. In the
event the Plan is terminated while excess amounts are then held in suspense
under subsection (c), such excess amounts shall be allocated and reallocated as
provided in subsection (c), as of

                                      -39-
<Page>

the day before the date of the termination as if such day were the last day of
such Plan Year. Any amounts which cannot then be so allocated because of the
limits of subsection (a) shall revert to the Company.

                  (e)      COMBINED LIMIT. All references to the requirements of
Code Section 415(e) (combined plan limit) are eliminated effective January 1,
2000.

                  Section 3.9 REEMPLOYMENT RIGHTS AFTER QUALIFIED MILITARY
SERVICE.

                  (a)      Effective December 12, 1994 solely for purposes of
this Section, the following definitions shall apply:

                           (i)      "Qualified Military Service" means any
service in the uniformed services (as defined in chapter 43 of title 38, United
States Code) by any individual if such individual is entitled to reemployment
rights under such chapter with respect to such service.

                           (ii)     "Compensation" means

                                    (A)      Compensation the Employee would
have received during his period of Qualified Military Service if the Employee
were not in Qualified Military Service, determined based on the rate of pay the
Employee would have received from the Employer but for absence during his period
of Qualified Military Service, or

                                    (B)      if the Compensation the Employee
would have received during his period of Qualified Military Service was not
reasonably certain, the Employee's average Compensation from the Employer during
the 12-month period immediately preceding the Qualified Military Service (or, if
the Employee had fewer than 12 months of employment, during the period of
employment immediately preceding the Qualified Military Service).

                  (b)      A Participant who leaves the Employer as a result of
Qualified Military Service and returns to employment with the Employer may elect
during the period described in subsection (c) to make additional 401(k)
Contributions and After Tax Contributions under the Plan in the amount
determined under subsection (d) or such lesser amount, as elected by the
Participant.

                  (c)      The period determined under this subsection shall be
the period which begins on the date of the Employee's reemployment with the
Employer after his Qualified Military Service that extends until the lesser of
either

                           (i)      the product of 3 and the period of Qualified
Military Service, or

                           (ii)     5 years.

                                      -40-
<Page>

                  (d)      The amount described in this subsection is the
maximum amount of 401(k) Contributions and After Tax Contributions that the
Participant would have been permitted to make in accordance with the limitations
described in subsection (f)(i) during the Participant's period of Qualified
Military Service if the Participant had continued to be employed by the Company
during such period and received Compensation. Proper adjustment shall be made
for any contributions actually made during the Participant's period of Qualified
Military Service.

                  (e)      If the Participant elects to make 401(k)
Contributions and/or After Tax Contributions under subsection (b), the Company
shall make a Matching Contribution to his Matching Account with respect to such
deferrals as would have been required under the Plan had such deferrals or
contributions actually been made during the period of such Qualified Military
Service.

                  (f)      If any deferral or contribution is made by a
Participant or the Employer pursuant to this Section,

                           (i)      such deferral or contribution shall not be
subject to any otherwise applicable limitation contained in Code Section 402(g),
404(a) or 415 and shall not be taken into account in applying such limitations
to other deferrals or benefits under the Plan or any other plan, with respect to
the Plan Year in which the deferral is made,

                           (ii)     such deferral or contribution shall be
subject to the limitations described in paragraph (i) with respect to the Plan
Year to which the deferral or contribution relates in accordance with the rules
prescribed by the Secretary of the Treasury,

                           (iii)    the Plan shall not be treated as failing to
meet the requirements of Code Section 401(a)(4), 401(k)(3), 401(m), 410(b) or
416 by reason of the making of (or the right to make) such deferral or
contribution.

                  (g)      The Employer shall not credit earnings on any
deferral or contribution made under this Section before such deferral or
contribution is actually made.

                  (h)      A Participant reemployed under subsection (b) shall
be treated as not incurring a Break in Service by reason of his period of
Qualified Military Service.

                                      -41-
<Page>

                                        ARTICLE IV.
                             ROLLOVERS AND TRANSFERS

                  Section 4.1 ROLLOVERS AND TRANSFERS.

                  (a)      An Eligible Employee may make a contribution to his
Rollover Account if such contribution meets the requirements of this Section and
is in accordance with the Rules of the Plan. The Administrator may require the
Eligible Employee to supply information sufficient to determine if his
contribution meets the requirements of this Section. If the Administrator
determines that such contribution does not meet the requirements of this
Section, the contribution shall not be permitted.

                  (b)      To meet the requirements of this Section, such
contribution must be

                           (i)      an Eligible Rollover Distribution from

                                    (A)      a qualified trust meeting the
requirements of Code Section 401(a) or

                                    (B)      an employee annuity plan meeting
the requirements of Code Section 403(a)(1);

                           (ii)     a tax-free rollover distribution from an
individual retirement account or an individual retirement annuity which in turn
consisted entirely of an Eligible Rollover Distribution paid from

                                    (A)      a qualified trust under Code
Section 401(a) or

                                    (B)      an annuity plan under Code Section
403(a); or

                           (iii)    a direct rollover from an Eligible
Retirement Plan that, if paid to an Eligible Employee instead of the Plan, would
have constituted an Eligible Rollover Distribution.

                  (c)      In addition, to meet the requirements of this
Section, such contribution must

                           (i)      be made within 60 days following the day on
which the Eligible Employee received the distribution from an Eligible
Retirement Plan, except as permitted by the Secretary of Treasury,

                           (ii)     constitute an Eligible Rollover Distribution
and

                           (iii)    consist entirely of cash.

                                      -42-
<Page>

                  (d)      Any amount contributed or transferred pursuant to
Article IV shall be credited to an Eligible Employee's Rollover Account. If
required by law, all or a portion of such contribution or transfer will be
accounted for separately.

                  (e)      The Administrator may, in its discretion, permit the
Plan to accept a direct transfer from a qualified trust (described in Code
Section 401(a)) of an Eligible Employee's benefits under such trust. Benefits
transferred on behalf of an Eligible Employee to the Plan under this Section
shall be credited to the Eligible Employee's transfer account or such other
Accounts as are designated by the Administrator. The Administrator shall not
accept any plan-to-plan transfer under this Section if such transfer would
require the Plan to provide optional forms of benefit not otherwise provided by
the Plan as required by Code Section 411(d)(6).

                  (f)      If the Administrator accepts a contribution or
transfer pursuant to this Section and later determines that it was improper to
do so, in whole or in part, the Plan shall refund the necessary amount to the
Eligible Employee.

                  (g)      An Eligible Employee who makes a contribution to his
Rollover Account pursuant to this Section prior to the date that he satisfies
the eligibility requirements described in Article II shall generally be treated
as a Participant for purposes of the Plan provisions relating to the valuation,
investment and distribution of Accounts. However such Eligible Employee shall
not be treated as a Participant for purposes of eligibility to make 401(k)
Contributions or After Tax Contributions or to receive an allocation of any
Matching Contributions.

                                      -43-
<Page>

                                        ARTICLE V.
                             INVESTMENT OF ACCOUNTS

                  Section 5.1 INVESTMENT OPTIONS.

                  (a)      INVESTMENT DIRECTION. As permitted under the Rules of
the Plan, a Participant and a Beneficiary of a deceased Participant may elect to
have his Accounts held and invested under any of the Investment Funds or to
change any prior investment election.

                  (b)      INVESTMENT ELECTIONS. Any investment election under
subsection (a) shall remain in effect until revoked or modified by the
Participant or Beneficiary. If Accounts are invested in more than one Investment
Fund, changes in proportions due to investment results shall not require any
automatic transfer of values between Investment Funds.

                  (c)      AVAILABLE INVESTMENT FUNDS. The Investment Funds
selected by the Investment Committee and offered under the Plan may be changed
from time to time without the necessity of amending this Plan. The Administrator
may set a maximum percentage of the total election that a Participant or
Beneficiary may direct into any specific Investment Fund.

                  (d)      MANNER OF MAKING INVESTMENT ELECTIONS. The
Administrator will establish the manner (writing, internet, intranet,
telephonic, electronic or other methods) and advance notice required for making
investment elections under Section 5.1.

                  (e)      TIMING. Purchases and sales of assets in the
Investment Funds as required under this Section shall be made within a
reasonable time after the applicable investment election is made, and Accounts
shall be adjusted to reflect amounts actually realized or paid in such
transactions.

                  (f)      ERISA SECTION 404(c). The Plan is a plan which is
described in ERISA Section 404(c) under which each Participant or Beneficiary
shall exercise control over the assets in his Accounts and shall be provided the
opportunity to choose, from a broad range of investments, the manner in which
the assets in his Accounts are invested. To the extent provided under ERISA and
the related regulations, the Participant or Beneficiary shall not be deemed to
be a fiduciary by reason of his exercise of control, and no person who is
otherwise a fiduciary shall be liable for any loss or by reason of any breach
which results from such exercise of control, whether by the Participant's or
Beneficiary's affirmative election or failure to make an election.

                  Section 5.2 DEFAULT INVESTMENT FUND. If a Participant or
Beneficiary fails or declines to make an effective

                                      -44-
<Page>

investment election, the Participant's or Beneficiary's Accounts shall be held
in one or more default Investment Funds as selected by the Investment Committee.

                  Section 5.3 INVESTMENT COMMITTEE.

                  (a)      The Investment Committee

                           (i)      has the responsibility and authority to
evaluate, select and remove the Investment Funds;

                           (ii)     has the authority to appoint and remove an
investment manager (within the meaning of Section 3(38) of ERISA);

                           (iii)    is entitled to vote proxies or exercise any
shareholder rights relating to shares held on behalf of the Plan in a registered
investment company;

                           (iv)     has the authority to retain and dismiss
investment advisors and other consultants;

                           (v)      may exercise its authority with respect to
other powers granted under the Plan or the Trust Agreement;

                           (vi)     may delegate its authority and
responsibilities as permitted by law; and

                           (vii)    may otherwise deal with the Trustee with
respect to the Trust Fund.

                  (b)      Members of the Investment Committee will serve
without compensation. However, reasonable expenses of the Investment Committee
may be paid by the Plan to the extent they are not paid by the Company.

                  Section 5.4 PARTICIPANTS HAVE RIGHT TO VOTE AND TENDER
HARRAH'S STOCK. Each Participant or Beneficiary shall be entitled to instruct
the Trustee as to the voting or tendering of any full or partial shares of
Harrah's Stock held on his behalf under the Plan in the Harrah's Stock Fund.
Prior to such voting or tendering of Harrah's Stock, each Participant or
Beneficiary shall receive a copy of the proxy solicitation or other material
relating to such vote or tender decision and a blank form for the Participant or
Beneficiary to complete which confidentially instructs the Trustee to vote or
tender such shares in the manner indicated by the Participants or Beneficiaries.
Upon receipt of such instructions, the Trustee shall act with respect to such
shares as instructed. With respect to the vote or tender of any shares for which
instructions are not received from Participants or Beneficiaries, the Investment

                                      -45-
<Page>

Committee shall instruct the Trustee to vote or tender such shares of Harrah's
Stock.

                  Section 5.5 REGISTRATION AND DISCLOSURE FOR HARRAH'S STOCK.
The Investment Committee shall be responsible for determining the applicability
(and, if applicable, complying with) the requirements of the Securities Act of
1933, as amended, and any other applicable blue sky law. The Investment
Committee shall also specify what restrictive legend or transfer restriction, if
any, is required to be set forth on the certificates for the securities and the
procedure to be followed by the Trustee to effectuate a resale of such
securities.

                  Section 5.6 HARRAH'S STOCK FUND

                  (a)      The Investment Committee shall establish the Harrah's
Stock Fund as an Investment Fund under the Plan. The Harrah's Stock Fund shall
be invested primarily in shares of Harrah's Stock (except that, as directed by
the Investment Committee, the Harrah's Stock Fund may be invested in cash and
cash equivalents, and rights, warrants and options issued with respect to
Harrah's Stock (to the extent permitted by the Code and ERISA)). Dividends paid
on shares of Harrah's Stock held in the Harrah's Stock Fund, if any, shall be
reinvested and used to purchase additional shares of Harrah's Stock.

                  (b)      The assets of the Harrah's Stock Fund shall be valued
in accordance with Article VI. The Administrator shall determine the manner in
which the interests of the Accounts of Participants and Beneficiaries in the
Harrah's Stock Fund shall be denominated.

                  Section 5.7 PUT OPTION.

                  (a)      GENERAL RULE. Harrah's Stock distributed from a
Participant's Account that is attributable to the former ESOP account shall be
subject to a put option as provided in this Section if the Harrah's Stock is not
"publicly traded" (as defined in Treas. Reg. Sec. 54.4975-7(b)(1)(iv)) when
distributed, or if the Harrah's Stock is subject to a "trading limitation" when
distributed. For purposes of this Section, a "trading limitation" is a
restriction under any Federal or state securities law or any regulation
thereunder affecting the security that would make the Harrah's Stock not as
freely tradable as Harrah's Stock not subject to the restriction.

                  (b)      EXERCISE OF PUT OPTION. The put option granted
pursuant to this Section may be exercisable by the Participant, a donee of the
Participant, a Beneficiary receiving the Harrah's Stock or by any other person
(including the Participant's estate or its distributees) to whom the Harrah's
Stock passes by reason of the Participant's death. In the event that Harrah's
Stock is subject to the put option granted by this Section, the holder of the
option may "put" the securities to the Company by notifying it in writing

                                      -46-
<Page>

that he is exercising the put option granted by this Section.

                  (c)      PRICE. The price at which the option is exercisable
shall be the fair market value of the Harrah's Stock as of the last day of the
relevant Plan Year, determined on the basis of a valuation performed in
accordance with Section 6.8.

                  (d)      PUT TO COMPANY. The put option granted pursuant to
this Section shall extend to the Company, not to the Plan. However, the Plan
may, on behalf of the Company, assume the Company's the rights and obligations
at the time that the put option is exercised, if it so desires. Any Company
Affiliate may also assume the put option on behalf of the Company. If the Plan
assumes the put, the put against the Company and all Company Affiliates shall be
extinguished.

                  (e)      PERIOD OF EXERCISE. The put option shall be
exercisable initially for a 60 day period, beginning on the date the security
subject to the put option is distributed (the "first put option period"). If the
put is not exercised during the first put option period, then it will be
exercisable for an additional 60 day period in the next following Plan Year (the
"second put option period") . Upon the close of the Plan Year during which the
security is distributed, the value of the Harrah's Stock shall be determined in
accordance with paragraph (c), and the Plan Administrator shall then notify each
former Participant who did not exercise the put option during the initial put
option period of the new value. Except as otherwise provided by law or
applicable regulations, the second put option period shall begin on the date
such notice is given and shall end 60 days thereafter. The period during which a
put option pursuant to this Section shall be exercisable shall not include any
time in which a distributee is unable to exercise the put option because the
Company is prohibited from honoring it by applicable state or Federal law.

                  (f)      OTHER TERMS OF PUT OPTION. The put option described
in this Section shall be granted in accordance with Section 409(h) of the Code
and all applicable regulations.

                                      -47-
<Page>

                                        ARTICLE VI.
                    VALUATION OF THE TRUST FUND AND ACCOUNTS

                  Section 6.1 INDIVIDUAL PARTICIPANT ACCOUNTING. The
Administrator shall maintain an individual set of Accounts for each Participant
in order to reflect transactions both by type of contribution and investment
medium. Financial transactions shall be accounted for at the individual Account
level by posting each transaction to the appropriate Account of each affected
Participant. Participant Account values shall be maintained in shares for the
Investment Funds. At any point in time, the Account value shall be determined
using the most recent Valuation Date values provided by the Trustee.

                  Section 6.2 PAYMENT OF FEES AND EXPENSES. Except to the extent
Plan fees and expenses related to Account maintenance, transaction and
Investment Fund management and maintenance are paid by the Company, such fees
and expenses shall be paid as set forth below. The Company may pay a lower
portion of the fees and expenses allocable to the Accounts of Participants who
are no longer Employees or who are not Beneficiaries, unless doing so would
result in impermissible discrimination.

                  (a)      ACCOUNT MAINTENANCE. Account maintenance fees and
expenses may include, but are not limited to, administrative, Trustee,
government annual report preparation, audit, legal, nondiscrimination testing,
and fees for any other special services. Account maintenance fees may be charged
at the Investment Fund level in the manner described in (c) below or charged to
Participants on a per Participant basis provided that no fee shall reduce a
Participant's Account balance below zero.

                  (b)      TRANSACTION. Transaction fees and expenses may
include, but are not limited to, withdrawal, distribution and loan fees.
Transaction fees shall be charged to the Participant's Account involved in the
transaction provided that no fee shall reduce a Participant's Account balance
below zero. No fees are assessed on Investment Fund election changes by a
Participant or Beneficiary. However, a fee (determined by the Administrator) may
be charged with respect to each purchase and sale of Harrah's Stock.

                  (c)      INVESTMENT FUND MANAGEMENT AND MAINTENANCE.
Management and maintenance fees and expenses related to the Investment Funds
shall be charged at the Investment Fund level and reflected in the net gain or
loss of each Investment Fund.

                  Section 6.3 PARTICIPANT STATEMENTS. The Administrator shall
provide Participants with electronic access to or written statements of their
Accounts at least once each Plan Year.

                                      -48-
<Page>

                  Section 6.4 ACCOUNTS FOR QDRO BENEFICIARIES. A separate
Account shall be established for an alternate payee entitled to any portion of a
Participant's Account under a QDRO as of the date and in accordance with the
directions specified in the QDRO. In addition, a separate Account may be
established during the period of time the Administrator, a court of competent
jurisdiction or other appropriate person is determining whether a domestic
relations order qualifies as a QDRO. Such a separate Account shall be valued and
accounted for in the same manner as any other Account.

                  (a)      DISTRIBUTIONS PURSUANT TO QDROS. If a QDRO so
provides, the portion of a Participant's Account payable to an alternate payee
may be distributed, in a form as permissible under Article XI, to the alternate
payee at the time specified in the QDRO, regardless of whether the Participant
is entitled to a distribution from the Plan at such time.

                  (b)      INVESTMENT DIRECTION. Where a separate Account has
been established on behalf of an alternate payee and has not yet been
distributed, the alternate payee may direct the investment of such Account in
the same manner as if he were a Participant.

                  Section 6.5 DETERMINATION OF VALUES. As of each Valuation
Date, the Administrator shall determine the fair market value of each asset in
each Investment Fund in compliance with the principles of Section 3(26) of ERISA
and regulations issued pursuant thereto, based upon information reasonably
available to it including data from, but not limited to, newspapers and
financial publications of general circulation, statistical and valuation
services, records of securities exchanges, appraisals by qualified persons,
transactions and bona fide offers in assets of the type in question and other
information customarily used in the valuation of property for purposes of the
Code. The value of any real property held in the Trust Fund determined as of the
end of any Plan Year shall be considered to remain unchanged until the end of
the following Plan Year. With respect to securities for which there is a
generally recognized market, the published selling prices on or nearest to such
valuation date shall establish the fair market value of such security. Fair
market value so determined shall be conclusive for all purposes of the Plan and
Trust.

                  Section 6.6 ALLOCATION OF VALUES. As of each Valuation Date,
the Trustee shall allocate the gains or losses of each Investment Fund since the
last preceding Valuation Date to Participant's Accounts in the same proportion
that the value of the Participant's Accounts invested in the Investment Fund in
question bears to the total value of all Participants' Accounts invested in the
Investment Fund. Such determinations shall be made without taking into account
deferrals of or contributions from Compensation or Employer contributions

                                      -49-
<Page>

attributable to the last Valuation Date or allocations of forfeitures for the
Plan Year; provided, however, that gains and losses shall not be allocated with
respect to amounts being held in suspense under Section 3.8(c).

                  Section 6.7 APPLICABILITY OF ACCOUNT VALUES. The value of an
Account, as determined as of a given date under this Article, plus any amounts
subsequently credited thereto and less any amounts withdrawn, distributed or
transferred to suspense, shall remain the value thereof for all purposes of the
Plan and Trust until revalued hereunder.

                  Section 6.8 HARRAH'S STOCK VALUATION. Notwithstanding the
foregoing provisions, in all cases the valuation provisions of this Section,
including the selection of a valuation date for any purpose under this Plan,
shall be interpreted and applied in a manner consistent with the applicable
requirements under Code Sections 409 and 4975(e)(7), the regulations issued
thereunder, and any related or successor statutes or regulations, that must be
satisfied in order to qualify for the prohibited transaction exemption under
Code Section 4975(d)(3). In this connection, all valuations of Harrah's Stock
contributed to or acquired by the Plan which at the time of such valuation is
not readily tradable on an established securities market within the meaning of
Code Section 401(a)(28) shall be made by an independent appraiser (within the
meaning of Code Section 170(a)(1)), whose name shall be reported to the Internal
Revenue Service.

                                      -50-
<Page>

                                       ARTICLE VII.
                                     VESTING

                  Section 7.1 VESTING OF ACCOUNTS.

                  (a)      401(k), AFTER TAX, ROLLOVER, QUALIFIED AND MONEY
PURCHASE ACCOUNTS. Each Participant shall be 100% vested in his 401(k), After
Tax, Rollover, Qualified and Money Purchase Accounts at all times.

                  (b)      MATCHING AND PRIOR PLAN ACCOUNTS. Effective December
30, 1999, except as provided in subsection (c), the vested portion of a
Participant's Matching and Prior Plan Accounts shall be the percentage of such
Account shown on the following table:

<Table>
                           (i)      Years of Vesting Service       Vested Percentage
                                    ------------------------       -----------------
<S>                                                                <C>
                                          less than 1                      0%
                                               1                           20%
                                               2                           40%
                                               3                           60%
                                               4                           80%
                                           5 or more                      100%
</Table>

                           (ii)     If the Participant who is not fully vested
in his Matching Account and Prior Plan Account, if any, has made an in-service
withdrawal from his Matching and/or Prior Plan Accounts, the vested amount of
such Accounts shall be the excess of

                                    (A)      the product of

                                            (I)      his vested percentage as
                                                     calculated under subsection
                                                     (b)(i), and

                                            (II)     the sum of the balance of
                                                     his Matching Account and/or
                                                     Prior Plan Account (as
                                                     applicable) and the amount
                                                     of the withdrawal over

                                    (B)      the amount of the withdrawal.

                  (c)      Notwithstanding the above, the interest of a
Participant in his Matching and Prior Plan Accounts shall become fully vested
upon the earliest to occur of:

                           (i)      his death while an Employee,

                           (ii)     his Normal Retirement Date, or

                           (iii)    his Disability Retirement Date.

                                      -51-
<Page>

                  (d)      AMENDMENT OF VESTING SCHEDULE. Upon any amendment of
the vesting schedule, a Participant with at least three Years of Vesting Service
may elect to have his vested interest calculated pursuant to the vesting
schedule which would have been in effect but for the amendment. However, no
election shall be provided for any Participant whose nonforfeitable percentage
under the Plan as amended at anytime cannot be less than such percentage
determined without regard to such amendment.

                  Section 7.2 FORFEITURES.

                  (a)      If a Participant has a Separation from the Service
due to resignation or discharge, the portion of his Matching and Prior Plan
Accounts which is not vested shall be forfeited upon the earlier of (i) the date
he receives his distribution from the Plan under Article XI or (ii) the date on
which he has a Forfeiture Break in Service.

                  (b)      If a Participant has a Separation from the Service
prior to becoming vested in any portion of his Matching and Prior Plan Accounts,
a distribution shall be deemed to have occurred upon such Separation from the
Service for purposes of subsection (a).

                  (c)      Until they are applied under Section 7.4, Forfeitures
shall be held in suspense and shall not be commingled with amounts held in
suspense under Section 3.8.

                  (d)      If the Participant is subsequently reemployed before
he has a Forfeiture Break in Service, the Participant's vested portion of these
Accounts at any time shall equal P[AB+(R x D)](R x D). For purposes of applying
the formula: P is the vested percentage of the relevant time; AB is the combined
balance of the Matching and Prior Plan Accounts at the relevant time; D is the
amount of any distribution made to the Participant from the Matching and Prior
Plan Accounts; and R is the ratio of the balance of such Accounts at the
relevant time to the balance of such Accounts after any such distribution.

                  Section 7.3 RESTORATION OF FORFEITURES. If a Participant whose
Matching and Prior Plan Accounts are not then fully vested

                  (a)      has a Separation from the Service,

                  (b)      suffers a forfeiture of the portion of such Accounts
which is not vested,

                  (c)      again becomes an Employee before he has a Forfeiture
Break in Service, and

                                      -52-
<Page>

                  (d)      repays to the Plan the full amount, if any,
distributed to him from his Accounts before the end of a Forfeiture Break in
Service commencing after his distribution, or, if earlier, the fifth anniversary
of his reemployment,

then the amounts forfeited by such Participant shall be restored, without
adjustment for investment earnings or losses, to his Matching and Prior Plan
Accounts as of the end of the Plan Year in which he is rehired. The restored
amounts will be funded by applying Forfeitures pending reallocation and, to the
extent required, Employer contributions, in that order.

                  Section 7.4 USE OF FORFEITURES. Effective January 1, 2001,
Forfeitures that occur during the Plan Year shall first be used to the extent
necessary to restore the Matching and Prior Plan Accounts of rehired
Participants (as provided in Section 7.3). Any remaining forfeitures may be used
to pay administrative expenses or will be included in, reduce and be considered
part of the Company's Matching Contribution for the Plan Year in which the
forfeiture arises.

                  Section 7.5 CHANGE IN CONTROL. The following provisions shall
govern in the event that an Employer or division, or any part of the assets of
an Employer, is acquired by, or merged into, a nonaffiliated company, or in the
event a nonaffiliated company acquires substantially all the outstanding stock
of an Employer:

                  (a)      The amounts credited to the Accounts of the Employees
who are involved in such acquisition or merger shall become 100 percent vested
whether or not this Plan is continued or assumed and whether or not the
successor company has or establishes a comparable plan. An Employee of an
Employer (other than an Employee of the Company) or division of an Employer
shall be deemed "involved" if his employment is terminated by reason of the
acquisition or merger or transferred (from the controlled group consisting of
the Company and all Company Affiliates) by reason of the acquisition or merger.
Employees of the Company shall be deemed "involved" if their employment is
terminated by reason of the acquisition or merger or if they continue in the
employment of the Company after control of it changes hands.

                  (b)      Subject to subsection (a), if the nonaffiliated
successor company agrees to establish, or shall have, a plan substantially
comparable to this Plan (as determined by the HRC), then the Plan assets
allocable to the Employees involved in the acquisition or merger may be
transferred to the plan so established by the successor company subject,
however, to the receipt of a favorable determination letter from the Internal
Revenue Service or opinion of counsel of the successor company satisfactory to
the Administrator that such successor plan is a tax-exempt plan and trust under
the applicable provisions of the Code.

                                      -53-
<Page>

                  (c)      Subject to subsection (a), if a nonaffiliated
successor company acquires substantially all of the stock or assets of the
Company by merger or acquisition or otherwise, then such successor company may
assume this Plan as the sponsoring company.

                  (d)      If a Company Affiliate or other entity that owns 50
percent or more of the Company's outstanding common stock acquires the Company
or substantially all of its assets or stock, then the affiliated company may
assume the Plan and the Plan shall then continue in effect without interruption
and without an acceleration in vesting.

                  (e)      For a corporate transaction that does not constitute
a merger or acquisition, the Employer shall determine, in its sole and absolute
discretion, whether a change in control has occurred and whether the provisions
of this Section shall apply with respect to affected Employees.

                                      -54-
<Page>

                                       ARTICLE VIII.
                             IN-SERVICE WITHDRAWALS

                  Section 8.1 IN-SERVICE WITHDRAWAL APPROVAL. A Participant must
apply for an in-service withdrawal in such manner and with such advance notice
as prescribed by the Administrator. The Administrator is responsible for
determining that an in-service withdrawal request conforms to the requirements
described in this Article and granting such request. All in-service withdrawals
are subject to the Rules of the Plan.

                  Section 8.2 PAYMENT FORM AND MEDIUM. The form of payment for
an in-service withdrawal shall be a cash lump sum. However, if all or any
portion of an in-service withdrawal represents an Eligible Rollover
Distribution, a Participant may elect a Direct Rollover.

                  Section 8.3 SOURCE AND TIMING OF IN-SERVICE WITHDRAWAL
FUNDING.

                  (a)      An in-service withdrawal to a Participant shall be
made solely from the assets of his own Accounts and will be based on the Account
values as of the Valuation Date the in-service withdrawal is processed. Within
each Account used for funding an in-service withdrawal, amounts shall be taken
by type of investment in direct proportion to the market value of the
Participant's interest in each Investment Fund as of the Valuation Date on which
the in-service withdrawal is processed.

                  (b)      In-service withdrawals will be funded on the date
following the Valuation Date as of which the in-service withdrawal is processed.
The Trustee shall make payment as soon thereafter as administratively feasible.

                  Section 8.4 SPOUSAL CONSENT. Except as required for a
Participant with an Account subject to Appendix B or C, no Spousal Consent is
required to obtain an in-service withdrawal.

                  Section 8.5 FEES. The Participant's Accounts may be charged
for actual administrative fees charged by a third-party recordkeeper for
in-service withdrawals.

                  Section 8.6 HARDSHIP WITHDRAWALS. An Active or Inactive
Participant may take an in-service withdrawal on account of Hardship, subject to
the following:

                                      -55-
<Page>

                  (a)      A Hardship withdrawal is only available from the
following Participant Accounts: (i) the 401(k) Account (excluding post-1989
investment earnings), (ii) the vested Prior Plan Account and (iii) the Money
Purchase Account.

                  (b)      A financial need of the Participant exists in a
manner determined by the Administrator or its delegate as follows (which the
Administrator or its delegate may rely upon unless the Administrator or its
delegate have actual knowledge to the contrary):

                           (i)      The withdrawal is required to meet an
immediate and heavy financial need, the amount of the withdrawal is necessary to
meet this need, and the requested amount does not exceed the amount necessary
(including taxes) to relieve the need.

                           (ii)     The need cannot reasonably be satisfied by
any of the following:

                                    (A)      Through reimbursement or
compensation by insurance or otherwise;

                                    (B)      By liquidation of the Participant's
assets or those of his spouse or minor children (which are reasonably available
to the Participant) without creating an additional and heavy financial need;

                                    (C)      By stopping 401(k) Contributions or
After Tax Contributions under the Plan;

                                    (D)      By other distributions or
nontaxable (at the time of the loan) loans from plans maintained by the
Employers (including this Plan) or by any other employer, or by borrowing from
commercial sources on reasonable commercial terms, in an amount sufficient to
satisfy the need.

For purposes of this subparagraph (ii), a need cannot reasonably be relieved by
one of the actions listed above if the effect would be to increase the amount of
the need.

                  (c)      The Hardship withdrawal will result in the suspension
of all Matching Contributions with respect to any 401(k) and After Tax
Contributions made for the next six months, beginning on the first day of the
month following the month in which the withdrawal is made.

                  (d)      Any other conditions prescribed by the Commissioner
of Internal Revenue through the publication of revenue rulings, notices, and/or
other documents of general applicability, as an alternate method under which a
Hardship withdrawal will be deemed to be necessary to satisfy an immediate and
heavy financial need.

                  Section 8.7 ROLLOVER ACCOUNT WITHDRAWAL.

                                      -56-
<Page>

                  An Active or Inactive Participant may withdraw all or a
portion of his Rollover Account at any time.

                  Section 8.8 AFTER TAX ACCOUNT WITHDRAWAL. An Active or
Inactive Participant may withdraw all or a portion of his After Tax Account at
any time. Any withdrawal of After Tax Contributions must include a pro-rata
share of investment earnings.

                  Section 8.9 MATCHING ACCOUNT WITHDRAWAL. An Active or Inactive
Participant may withdraw all or a portion of his vested Matching Account at any
time provided that either the Participant has participated in the Plan for at
least 5 years or that the amounts to be withdrawn have been held in the Plan for
at least 2 years.

                  Section 8.10 AGE 59 1/2 WITHDRAWAL. An Active or Inactive
Participant who attains age 59 1/2 may withdraw all or a portion of his 401(k)
Account, Qualified Account, Money Purchase Account and vested Prior Plan Account
at any time.

                                      -57-
<Page>

                                        ARTICLE IX.
                                      LOANS

                  Section 9.1 PARTICIPANT LOANS PERMITTED. Loans to Participants
are permitted pursuant to the terms and conditions set forth in this Article,
the Rules of the Plan and the loan policy established by the Administrator. At
the discretion of the Administrator, Participants may be charged a reasonable
administrative fee in connection with obtaining and/or maintaining a Plan loan.

                  Section 9.2 LOAN APPLICATION, NOTE AND SECURITY. A Participant
shall apply for any loan in such manner and with such advance notice as
prescribed by the Administrator. All loans shall be evidenced by a promissory
note, secured only by the portion of the Participant's Account from which the
loan is made, and the Plan shall have a lien on this portion of his Account.

                  Section 9.3 LOAN APPROVAL. The Administrator is responsible
for determining that a loan request conforms to the requirements described in
this Article and granting such request.

                  Section 9.4 SPOUSAL CONSENT. Except as required for a
Participant with an Account subject to Appendix B or C, no Spousal Consent is
required to obtain an in-service withdrawal.

                  Section 9.5 LEGAL MAXIMUM LIMIT. The maximum a Participant may
borrow, including the outstanding balance of existing Plan loans, is 50% of the
vested balance of his Accounts, not to exceed $50,000. However, the $50,000
maximum is reduced by the Participant's highest outstanding loan balance during
the 12 month period ending on the day before the date as of which the loan is
made. For purposes of this paragraph, the qualified plans of all Company
Affiliates shall be treated as though they are part of this Plan to the extent
it would decrease the maximum loan amount.

                                      -58-
<Page>

                                        ARTICLE X.
                     EMPLOYMENT AFTER NORMAL RETIREMENT DATE

                  Section 10.1 CONTINUATION OF EMPLOYMENT.

                  (a)      A Participant may, subject to subsection (b) and
Section 15.3, remain in the employ of the Company or a Company Affiliate after
attaining his Normal Retirement Date.

                  (b)      Notwithstanding subsection (a), the Company reserves
the right to require a Participant to retire in accordance with Section 12(c) of
the Age Discrimination in Employment Act of 1967, as amended and applicable
state law.

                  Section 10.2 CONTINUATION OF PARTICIPATION. A Participant
retained in the employ of the Employer after his Normal Retirement Date shall
continue as an Active Participant of the Plan.

                  Section 10.3 REQUIRED MINIMUM DISTRIBUTIONS.

                  (a)      NOT A FIVE PERCENT OWNER. Effective January 1, 1997
for a Participant who is not a Five Percent Owner in the calendar year in which
he attains age 70 1/2 distributions shall be made or commence not later than the
later of (i) the April 1 following the calendar year in which his Separation
from the Service occurs, or (ii) the April 1 following the calendar year in
which he attains age 70 1/2.

                  (b)      FIVE PERCENT OWNER. Effective January 1, 1997, a
Participant who is a Five Percent Owner in the calendar year in which he attains
age 70 1/2 shall receive or commence the receipt of the entire amount credited
to his Accounts in accordance with Article X on the April 1 following the end of
the calendar year in which he attains age 70 1/2.

                  (c)      Notwithstanding the above, all distributions shall
satisfy the minimum distribution incidental death benefit requirements of Prop.
Treas. Reg. Sec. 1.401(a)(9)-2 (or any successor thereto).

                                      -59-
<Page>

                                        ARTICLE XI.
                                  DISTRIBUTIONS

                  Section 11.1 RIGHTS UPON NORMAL OR DISABILITY RETIREMENT OR
SEPARATION FROM THE Service. Upon a Participant's Normal, Early or Disability
Retirement or Separation from the Service, he shall be entitled to receive the
vested amount credited to his Accounts in accordance with Section 11.2. Under no
circumstances will a Participant's 401(k) and Qualified Accounts be distributed
prior to his Separation from the Service except as permitted under Code Section
401(k)(10) or as required by Section 3.3(g), 3.5 or 3.7.

                  Section 11.2 DISTRIBUTION OF ACCOUNTS. Except as provided in
Section 11.5 and Appendix B or C, distribution of the vested Accounts of a
Participant or a Beneficiary of a deceased Participant shall be made in cash in
one of the following forms as elected by the Participant or Beneficiary:

                  (a)      a single lump sum,

                  (b)      in cash installments paid over a period not to exceed
15 years,

                  (c)      in a Direct Rollover to the extent that the payment
is an Eligible Rollover Distribution and the recipient is a Distributee or

                  (d)      until June 1, 2002 or 90 days after the date
Participants are given the required notice, whichever is later, a term certain
annuity.

                  Section 11.3 SMALL ACCOUNTS. The Participant shall select the
method by which his vested Accounts will be distributed to him. Notwithstanding
the foregoing, effective January 1, 1998, if the distributable balance of the
Participant's Accounts is $5,000 or less and the Participant fails to elect a
form of distribution when payable, then the Trustee shall distribute the
Participant's vested Accounts in a lump sum. Additionally, if the distributable
balance of the Participant's Accounts is $200 or less, then the Trustee shall
distribute the Participant's vested Accounts in a lump sum, and the Participant
shall have no right to elect a Direct Rollover.

                  Section 11.4 DETERMINATION OF VALUE OF ACCOUNTS. When a
distribution under the Plan is made, the value of a Participant's Accounts shall
be determined as of the Valuation Date coinciding with or next preceding the
Participant's distribution date (after all adjustments then required or
permitted under the Plan have been made).

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                  Section 11.5 DISTRIBUTIONS OF HARRAH'S STOCK. The Participant
may elect to receive a distribution of his Accounts in whole shares of Harrah's
Stock from his Accounts to the extent that they are invested in Harrah's Stock
(except that the equivalent of any fractional share shall be distributed in cash
at fair market value).

                                      -61-
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                  Section 11.6 TIMING.

                  (a)      Distribution of a Participant's vested Accounts will
normally be made or commenced as soon as practicable following the Participant's
date of Separation from the Service, but not later than the 60th day after the
later of (i) the close of the Plan Year during which the Participant attains age
65 or, (ii) the close of the Plan Year, during which his date of Separation from
the Service occurs, except as otherwise permitted under circumstances described
in Treas. Reg. Sec. 1.401(a)-14(d). If the value of the Participant's Accounts
is over $5,000 (effective January 1, 1998), the Participant (but not his
Beneficiary in the event of the Participant's death) must consent in writing to
receive the distribution, but no Participant may not elect to defer distribution
beyond the date described above.

                  (b)      Distributions must commence as required under Section
10.3, Code Section 401(a)(9) and the regulations thereunder including the
minimum incidental death benefit rules under Prop. Treas. Reg. Sec.
1.401(a)(9)-2.

                  Section 11.7 NOTICE. If a distribution is one to which Code
Sections 401(a)(11) and 417 do not apply, distribution of a Participant's
Accounts may commence less than 30 days after the notice required under Treas.
Reg. Sec. 1.411(a)-11(c) is given, provided that

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

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

                  (c)      the Participant is permitted to revoke an affirmative
distribution election at least until the date of commencement of the
distribution, or, if later, at any time prior to the expiration of the 7-day
period that begins the day after the explanation described in paragraph (a) is
provided to the Participant and

                  (d)      the distribution of the Participant's Accounts
commences after the date the explanation described in paragraph (a) is provided
to the Participant but not before the expiration of the 7-day period that begins
after such explanation is provided.

                  Section 11.8 DISTRIBUTION UPON DEATH

                  (a)      If a Participant dies before distribution of his
Accounts commences, then

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the vested balance of his Accounts shall be paid to his Beneficiary in one of
the available forms, as elected by the Beneficiary. Payment to a Beneficiary
must either:

                           (i)      be completed by the end of the calendar year
that contains the fifth anniversary of the Participant's death or

                           (ii)     begin by the end of the calendar year that
contains the first anniversary of the Participant's death and be completed
within the period of the Beneficiary's life or life expectancy, except that:

                                    (A)      If the surviving Spouse is the
Beneficiary, payments need not begin until the later of

                                            (I)      the end of the calendar
                                                     year that includes the
                                                     first anniversary of the
                                                     Participant's death or

                                            (II)     the end of the calendar
                                                     year in which the
                                                     Participant would have been
                                                     required to commence
                                                     payments under Section
                                                     10.3, and must be completed
                                                     within the Spouse's life or
                                                     life expectancy; and

                                    (B)      If the Participant and the
surviving Spouse who is the Beneficiary die

                                            (I)      before the date on which
                                                     the Participant would have
                                                     been required to begin
                                                     payments under Section 10.3
                                                     and

                                            (II)     before payments have begun
                                                     to the Spouse, the Spouse
                                                     shall be treated as the
                                                     Participant in applying
                                                     these rules.

                  (b)      If payment has commenced prior to the Participant's
death, payment of the Participant's Accounts shall be made in such manner that
the remaining interest is distributed at least as rapidly as under the method
being used as of the date of the Participant's death.

                                      -63-
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                                       ARTICLE XII.
                              TOP HEAVY PROVISIONS

                  Section 12.1 TOP HEAVY DETERMINATION.

                  (a)      Solely in the event that this Plan ever becomes Top
Heavy, as defined herein, the provisions of this Article shall apply.

                  (b)      Solely for the purposes of this Article, the
following definitions shall be used:

                           (i)      "Aggregation Group" means

                                    (A)      each plan of the Company or a
Company Affiliate in which a Key Employee is a Participant (including any such
plan which has been terminated if such plan was maintained by the Company or
Company Affiliate within the last five years ending on the Determination Date
for the Plan Year in question) but excluding a plan meeting the requirements of
Code Section 401(k)(11); provided, however, that such plan allows only
contributions required under Code Section 401(k)(11)), and

                                    (B)      each other plan of the Company or a
Company Affiliate which enables any plan described in Subsection (a) to meet the
requirements of Code Section 401(a)(4) or 410.

                           (ii)     "Determination Date" means, with respect to
any Plan Year, the last day of the preceding Plan Year, or in the case of the
first Plan Year, the last day of such Plan Year.

                           (iii)    Effective for Plan Years commencing on or
after January 1, 2002, "Key Employee" means

                                            (I)      any Employee or former
                                                     Employee (including any
                                                     deceased Employee) who at
                                                     any time during the Plan
                                                     Year that includes the
                                                     Determination Date was an
                                                     officer of the Company or a
                                                     Company Affiliate having
                                                     Statutory Compensation
                                                     greater than $130,000 (as
                                                     adjusted under Code Section
                                                     416(i)(1) for Plan Years
                                                     beginning after December
                                                     31, 2002);

                                            (II)     a Five Percent Owner of the
                                                     Company or a Company
                                                     Affiliate; or

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                                            (III)    a one percent owner (within
                                                     the meaning of Code Section
                                                     416(i)(1)(B) and (C) of the
                                                     Company or a Company
                                                     Affiliate having Statutory
                                                     Compensation of more than
                                                     $150,000.

                                    (A)      Effective for Plan Years commencing
prior to January 1, 2002, "Key Employee" means an Employee, a former Employee or
the Beneficiary of a former Employee, if, in the Plan Year containing the
Determination Date or in any of the four preceding Plan Years, such Employee or
former Employee is or was

                                            (I)      an officer of the Company
                                                     or a Company Affiliate
                                                     whose Statutory
                                                     Compensation for the Plan
                                                     Year in question exceeds
                                                     fifty percent of the amount
                                                     in effect under Code
                                                     Section 415(b)(1)(A) (not
                                                     more than fifty Employees
                                                     or, if less, the greater of
                                                     three Employees or ten
                                                     percent of the Employees
                                                     shall be treated as
                                                     officers),

                                            (II)     one of the ten Employees
                                                     owning (or considered as
                                                     owning within the meaning
                                                     of Code Section 318) both
                                                     the largest interest in the
                                                     Company or a Company
                                                     Affiliate and more than
                                                     one-half of one percent
                                                     interest therein and whose
                                                     Statutory Compensation for
                                                     the Plan Year in question
                                                     equals or exceeds the
                                                     amount in effect under Code
                                                     Section 415(c)(1)(A);
                                                     provided, however, if two
                                                     Employees have the same
                                                     interest in the Company or
                                                     a Company Affiliate, the
                                                     Employee with the greater
                                                     Statutory Compensation for
                                                     such Plan Year shall be
                                                     treated as having the
                                                     larger interest,

                                            (III)    a Five Percent Owner or a
                                                     one percent owner (within
                                                     the meaning of Code Section
                                                     416(i)(1)(B) and (C)) of
                                                     the Company or a Company
                                                     Affiliate whose Statutory
                                                     Compensation for the Plan
                                                     Year in question exceeds
                                                     $150,000.

                           (iv)     "Non-Key Employee" means any Employee who is
not a Key Employee.

                                      -65-
<Page>

                           (v)      The Plan shall be Top Heavy if, as of any
Determination Date, the aggregate of the Accounts of Key Employees under all
plans in the Aggregation Group (or under this Plan and such other plans as the
Company elects to take into account under Code Section 416(g)(2)(A)(ii)) exceeds
sixty percent of the aggregate of the Accounts for all Key Employees and Non-Key
Employees. In making this calculation as of a Determination Date,

                                    (A)      each Account balance as of the most
recent valuation date occurring within the Plan Year which includes the
Determination Date shall be determined,

                                    (B)      an adjustment for contributions due
as of the Determination Date shall be determined,

                                    (C)      the Account balance of any Employee
or former Employee shall be increased by the aggregate distributions made
during, effective January 1, 2002, the one-year period ending on the
Determination Date (or, prior to January 1, 2002, the five-year period ending on
the Determination Date) with respect to such Employee or former Employee and,
effective January 1, 2002, the aggregate distributions made for a reason other
than Separation from the Service, death or Disability during the one-year period
ending on the Determination Date,

                                    (D)      the Account balance of

                                            (I)      any Non-Key Employee who
                                                     was a Key Employee for any
                                                     prior Plan Year, and

                                            (II)     any former Employee who
                                                     performed no services for
                                                     the Company or a Company
                                                     Affiliate during, effective
                                                     January 1, 2002, the
                                                     one-year period ending on
                                                     the Determination Date (or,
                                                     prior to January 1, 2002,
                                                     the five-year period ending
                                                     on the Determination Date)
                                                     shall be ignored, and

                                    (E)      if there have been any rollovers to
or from any Account, the balance of such Account shall be adjusted, as required
by Code Section 416(g)(4)(A).

Notwithstanding the foregoing, this Plan shall be Top Heavy if, as of any
Determination Date, it is required by Code Section 416(g) to be included in an
Aggregation Group which is determined to be a Top Heavy Group.

                           (vi)     "Top Heavy Group" means any Aggregation
Group if, as of the Determination Date, the sum of

                                    (A)      the present value of the cumulative
accrued benefits for all

                                      -66-
<Page>

Key Employees under all defined benefit plans in such Aggregation Group, and

                                    (B)      the aggregate of the accounts of
all Key Employees under all defined contribution plans in such Aggregation Group

exceeds sixty percent of a similar sum determined for all Key Employees and
Non-Key Employees.

                  Section 12.2 MINIMUM BENEFITS.

                  (a)      For any Plan Year in which the Plan is Top Heavy, the
total allocation to the Qualified Account or Matching Account of any Employee
who is a Non-Key Employee at the end of such Plan Year and is

                           (i)      entitled to an allocation to such Account
under Section 3.4, or

                           (ii)     not entitled to an allocation under such
Sections solely because he did not elect to defer Compensation under Section 3.3
of the Plan,

shall not be less than that determined under subsection (b).

                  (b)      The allocation determined under this subsection shall
be a percentage of the Statutory Compensation of such Non-Key Employee which is
not less than the lesser of

                           (i)      three percent, or

                           (ii)     that percentage reflecting the ratio of

                                    (A)     the allocations under Section 3.4 to

                                    (B)     Statutory Compensation

for the Key Employee with respect to whom such ratio is highest for such Plan
Year.

                                      -67-
<Page>

                  (c)      This Section shall not apply to any Participant to
the extent the Participant is covered under any other plan sponsored by the
Company or a Company Affiliate provided the minimum allocation or benefit
requirement applicable to Top Heavy Plans will be met in the other plan or
plans. For the purposes of determining whether or not the provisions of this
Section have been satisfied, both contributions or benefits under Chapter 2 of
the Code (relating to tax on self-employment income), Chapter 21 of the Code
(relating to Federal Insurance Contributions Act), Title 11 of the Social
Security Act, or any other Federal or state laws and Company contributions made
under any salary reduction or similar arrangement shall be disregarded.

                  (d)      An Employee described in subsection (a)(ii) shall be
treated as a Participant hereunder.

                                      -68-
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                                       ARTICLE XIII.
                            ADMINISTRATIVE PROVISIONS

                  Section 13.1 DUTIES AND POWERS OF THE ADMINISTRATOR.

                  (a)      The Administrator shall administer the Plan in
accordance with the Plan and ERISA and, in addition to the duties specifically
set forth in the Plan, shall have full discretionary power and authority:

                           (i)      To engage actuaries, attorneys, accountants,
appraisers, brokers, consultants, administrators, recordkeepers, custodians,
physicians or other firms or persons and (with its officers, directors and
employees) to rely upon the reports, advice, opinions or valuations of any such
persons except as required by law;

                           (ii)     To adopt Rules of the Plan that are not
inconsistent with the Plan or applicable law and to amend or revoke any such
rules;

                           (iii)    To construe and interpret the Plan and the
Rules of the Plan and to remedy any ambiguities and inconsistencies therein;

                           (iv)     To determine questions of eligibility and
vesting of Participants;

                           (v)      To determine entitlement to allocations of
contributions and forfeitures and to distributions of Participants, former
Participants, Beneficiaries, and all other persons;

                           (vi)     To make findings of fact as necessary to
make any determinations and decisions in the exercise of such discretionary
power and authority;

                           (vii)    To appoint claims and review officials to
conduct claims procedures as provided in Section 13.4;

                           (viii)   To compute, certify to and direct the
Trustee with regard to the amount and kind of benefits payable to Participants
and their Beneficiaries;

                           (ix)     To authorize all disbursements by the
Trustee from the Trust Fund;

                           (x)      To maintain all records that may be
necessary for the administration of the Plan other than those maintained by the
Trustee; and

                           (xi)     To delegate any power or duty to any firm or
person engaged under paragraph (i) or to any other person or persons.

                  (b)      Every finding, decision, and determination made by
the Administrator shall, to the full extent permitted by law, be final and
binding upon all parties, except as

                                      -69-
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provided in Section 13.4 or to the extent found by a court of competent
jurisdiction to constitute an abuse of discretion.

                  (c)      Notwithstanding anything contained in the Plan to the
contrary, all actions taken by the Administrator shall cause the Plan or the
Trust to be treated as a "domestic trust" under Treas. Reg. Sec. 301.7701, and
no action will be taken by the Administrator, or, if taken, will be valid, which
would cause the Plan or the Trust not to be considered as a domestic trust.

                  Section 13.2 ADMINISTRATIVE COMMITTEE. Harrah's Operating
Company Memphis, Inc., as Administrator of the Plan, has appointed an
Administrative Committee to administer the Plan on its behalf. The Administrator
shall provide the Trustee with the names and specimen signatures of any persons
authorized to serve as Administrative Committee members and act as or on its
behalf. Any Administrative Committee member appointed by the Administrator shall
serve at the pleasure of the Administrator but may resign by written notice to
the Administrator. Administrative Committee members shall serve without
compensation from the Plan for such services. Except to the extent that the
Administrator otherwise provides, any delegation of duties to the Administrative
Committee shall carry with it the full discretionary authority of the
Administrator to complete such duties.

                  Section 13.3 ADMINISTRATIVE COMMITTEE OPERATING RULES.

                  (a)      ACTIONS OF MAJORITY. Any act delegated by the
Administrator to the Administrative Committee may be accomplished with the
approval of a majority of its members. The majority may be expressed by a vote
at a meeting or in writing without a meeting, and a majority action shall be
equivalent to an action of all Administrative Committee members.

                  (b)      MEETINGS. The Administrative Committee shall hold
meetings upon such notice, place and times as it determines necessary to conduct
its functions properly,

                  Section 13.4 CLAIMS PROCEDURE.

                  (a)      A claim by a Participant, Beneficiary or any other
person shall be presented to the claims official appointed by the Administrator
in writing within the maximum time permitted by law or under the regulations
promulgated by the Secretary of Labor or his delegate pertaining to claims
procedures.

                  (b)      The claims official shall, within a reasonable time,
consider the claim and shall issue his determination thereon in writing.

                                      -70-
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                  (c)      If the claim is granted, the appropriate distribution
or payment shall be made from the Trust Fund or by the Company.

                  (d)      If the claim is wholly or partially denied, the
claims official shall, within 90 days (or such longer period as may be
reasonably necessary), provide the claimant with written notice of such denial,
setting forth, in a manner calculated to be understood by the claimant

                           (i)      the specific reason or reasons for such
denial,

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

                           (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 Plan's claim review
procedure.

                  (e)      The Administrator shall provide each claimant with a
reasonable opportunity to appeal the claims official's denial of a claim to a
review official (appointed by the Administrator in writing) for a full and fair
review. The claimant or his duly authorized representative

                           (i)      may request a review upon written
application to the review official (which shall be filed with it),

                           (ii)     may review pertinent documents, and

                           (iii)    may submit issues and comments in writing.

                  (f)      The review official may establish such time limits
within which a claimant may request review of a denied claim as are reasonable
in relation to the nature of the benefit which is the subject of the claim and
to other attendant circumstances but which, in no event, shall be less than 60
days after receipt by the claimant of written notice of denial of his claim.

                  (g)      The decision by the review official upon review of a
claim shall be made not later than 60 days after his receipt of the request for
review, unless special circumstances require an extension of time for
processing, in which case a decision shall be rendered as soon as possible, but
not later than 120 days after receipt of such request for review.

                  (h)      The decision on review shall be in writing and shall
include specific reasons for the decision written in a manner calculated to be
understood by the claimant with specific references to the pertinent Plan
provisions on which the decision

                                      -71-
<Page>

is based.

                  (i)      The claims official and the review official shall
have full discretionary power and authority to construe the Plan and the Rules
of the Plan, to determine questions of eligibility, vesting and entitlements and
to make findings of fact as under Section 13.1 and, to the extent permitted by
law, the decision of the claims official (if no review is properly requested) or
the decision of the review official on review, as the case may be, shall be
final and binding on all parties except to the extent found by a court of
competent jurisdiction to constitute an abuse of discretion.

                  (j)      Except as otherwise decided by the Administrator, the
Administrative Committee will be the claims official and reviewing official for
purposes of this Section.

                  Section 13.5 CONFLICTING CLAIMS. If the Administrator is
confronted with conflicting claims concerning a Participant's Accounts, the
Administrator may interplead the claimants in an action at law, or in an
arbitration conducted in accordance with the rules of the American Arbitration
Association, as the Administrator shall elect in its sole discretion. In either
case, the attorneys' fees, expenses and costs reasonably incurred by the
Administrator in such proceeding shall be paid from the Participant's Accounts.

                  Section 13.6 PAYMENTS. In the event any amount becomes payable
under the Plan to a minor or a person who, in the sole judgment of the
Administrator, is considered by reason of physical or mental condition to be
unable to give a valid receipt therefor, the Administrator may direct that such
payment be made to any person found by the Administrator, in its sole judgment,
to have assumed the care of such minor or other person. Any payment made
pursuant to such determination shall constitute a full release and discharge of
the Trustee, the Administrator and the Company and the Company Affiliates their
officers, directors, employees, owners, agents and representatives.

                  Section 13.7 EFFECT OF DELAY OR FAILURE TO ASCERTAIN AMOUNT
DISTRIBUTABLE OR TO LOCATE DISTRIBUTEE.

                  (a)      If an amount payable under the Plan cannot be
ascertained or the person to whom it is payable has not been ascertained or
located within the stated time limits and reasonable efforts to do so have been
made, then distribution shall be made no later than 60 days after such amount is
determined or such person is ascertained or located, or as prescribed in
subsection (b).

                  (b)      If, within one year after a Participant has a
Separation from the Service,

                                      -72-
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the Administrator, in the exercise of due diligence, has failed to locate him
(or if such Separation from the Service is by reason of his death, has failed to
locate the Participant's Beneficiary, his entire distributable interest in the
Plan shall be forfeited and applied to pay expenses of the Plan or to reduce the
Company's Matching Contribution under Section 3.4; provided, however, that if
the Participant (or in the case of his death, the Participant's Beneficiary)
makes proper claim therefor under Section 13.4, the amount so forfeited shall be
restored to the Participant's Account, applying forfeitures pending application,
Company contributions and unallocated earnings and gains of the Trust Fund, in
that order, as necessary.

                  Section 13.8 SERVICE OF PROCESS. The General Counsel of the
Company is hereby designated as agent of the Plan for the service of legal
process.

                  Section 13.9 LIMITATIONS UPON POWERS OF THE ADMINISTRATOR. The
Plan shall not be operated so as to discriminate in favor of Highly Compensated
Employees. The Plan shall be uniformly and consistently interpreted and applied
with regard to all Participants in similar circumstances. The Plan shall be
administered, interpreted and applied fairly and equitably and in accordance
with the specified purposes of the Plan.

                  Section 13.10 ANTI-ALIENATION PROVISIONS.

                  (a)      PROHIBITED ASSIGNMENTS. Except as provided in
subsections (b) and (c), no part of the Trust Fund shall be liable for the
debts, contracts or engagements of any Participant, his Beneficiaries or
successors in interest, or be taken in execution by levy, attachment or
garnishment or by any other legal or equitable proceeding, while in the hands of
the Trustee, nor shall any such person have any right to alienate, anticipate,
commute, pledge, encumber or assign any benefits or payments hereunder in any
manner whatsoever, except to designate a Beneficiary as provided in the Plan.

                  (b)      QDRO DISTRIBUTIONS. Notwithstanding subsection (a) or
any other provision of the Plan to the contrary, when the Administrator receives
a domestic relations order, as defined in Code Section 414(p), that, but for the
time of required payment to the alternate payee, would be a QDRO, the amount
awarded to the alternate payee shall promptly be paid in the manner specified in
such order. However, no such distribution shall be made prior to the
Participant's Separation from the Service if such distribution could adversely
affect the qualified status of the Plan. The Administrator will establish
procedures for processing QDROs.

                  (c)      CERTAIN OFFSETS OF ACCOUNTS. (i) Notwithstanding
subsection (a) or any other provision of the Plan to the contrary, effective
August 5, 1997, upon receipt by

                                      -73-
<Page>

the Administrator of a judgment, order, decree or settlement agreement described
in paragraph (ii) which expressly provides for an offset against all or part of
an amount ordered or required to be paid to the Plan against a Participant's
Accounts under the Plan, such Participant's Accounts shall be reduced or offset
by the amount specified in such judgment, order, decree or settlement agreement
and such amount shall promptly be paid to the Plan.

                           (ii)     The judgment, order, decree or settlement
                  agreement described in paragraph (i) must arise from

                                    (A)      a judgment of conviction for a
crime involving the Plan,

                                    (B)      a civil judgment (including a
consent order or decree) entered by a court in an action brought in connection
with a violation (or alleged violation) of Part 4 of ERISA, or

                                    (C)      a settlement agreement between the
Secretary of Labor or the Pension Benefit Guaranty Corporation and the
Participant in connection with a violation (or alleged violation) of Part 4 of
ERISA by a fiduciary or any other person.

                  Section 13.11 CORRECTIVE OF ADMINISTRATIVE ERRORS; SPECIAL
CONTRIBUTIONS. Notwithstanding any other provision of the Plan to the contrary,
the Administrator shall take any and all appropriate actions to correct errors
in the administration of the Plan, including, without limitation, errors in the
allocation of contributions, forfeitures, and income, expenses, gains and losses
to the Accounts of the Participants or Beneficiaries under the Plan. Such
corrective actions may include debiting or crediting a Participant's or
Beneficiary's Accounts or allocating special contributions made by the Employer
to the Plan for purposes of correcting any failure to make contributions on a
timely basis or properly allocate contributions, forfeitures, or income,
expenses, gains and losses. The Administrator shall determine the amount of any
such special contributions required to be made by the Employer, which may be
made in such approximate amounts as the Administrator, acting in its sole
discretion, shall determine. In no event shall any corrective action taken by
the Administrator under this Section reduce any Participant's or Beneficiary's
accrued benefit in violation of Section 411(d)(6) of the Code and the Treasury
regulations thereunder.

                  Section 13.12 ELECTRONIC ADMINISTRATION. The Administrator
shall have the authority to permit Participants and Beneficiaries to use
alternative means (including, but not limited to, electronic, internet,
intranet, voice response, or telephonic) to submit elections, directions, and
forms required for participation in and the administration of this Plan.

                                      -74-
<Page>

                                       ARTICLE XIV.
                          TERMINATION, DISCONTINUANCE,
                       AMENDMENT, MERGER, ADOPTION OF PLAN

                  Section 14.1 TERMINATION OF PLAN; DISCONTINUANCE OF
CONTRIBUTIONS.

                  (a)      The Plan is intended as a permanent program but the
Company shall have the right at any time to declare the Plan terminated
completely as to the Company or as to any division, facility or other
operational unit thereof with or without notice to the applicable Participants.
Discharge or layoff of Employees of the Company or any unit thereof without such
a declaration shall not result in a termination or partial termination of the
Plan except to the extent required by law. In the event of any termination or
partial termination:

                           (i)      an allocation of amounts being held under
Section 3.8(c) shall be made in accordance with Section 3.8(c).

                           (ii)     the Administrator shall direct the Trustee
to liquidate the necessary portion of the Trust Fund and distribute it, less, to
the extent permitted by law, a proportionate share of the expenses of
termination, to the persons entitled thereto in proportion to their Accounts.

                           (iii)    provided that the Company or a Company
Affiliate does not maintain another defined contribution plan other than an
employee stock ownership plan (as defined in Code Section 4975(e)(7)),
distributions of Participant's Accounts shall be made in one lump sum payment.

                  (b)      The Company shall have the right at any time to
discontinue contributions to the Plan completely as to the Company or as to any
covered location division, facility or other operational unit thereof with or
without notice to the applicable Participants. Failure of the Company to make
one or more substantial contributions to the Plan for any period of three
consecutive Plan Years in each of which the Company realized substantial current
earnings, as shown on its financial reports, shall automatically become a
complete discontinuance of contributions at the end of the third such
consecutive Plan Year. In the event of complete discontinuance of contributions
to the Plan, the Plan and Trust shall otherwise remain in full force and effect
except that all the Matching Accounts shall thereupon become fully vested.

                  Section 14.2 AMENDMENT OF PLAN.

                  (a)      As limited in Section 14.3 of the Plan, complete or
partial amendments or modifications to the Plan (including retroactive
amendments to meet governmental

                                      -75-
<Page>

requirements or prerequisites for tax qualification) may be made from time to
time by the Company. However, no amendment shall decrease the vested percentage
any Participant has in his Accounts or his accrued benefit.

                  (b)      Amendments shall be adopted by resolution of the
Board of the Company. Additionally, the General Counsel or Vice President, Human
Resources of the Company shall have the authority to adopt amendments that are
necessary (i) to bring the Plan into conformity with legal requirements or to
improve Plan administration, provided that no such amendments involve an
increase in cost of benefits provided by this Plan, or (ii) to provide for
mergers of plans of Company Affiliates into the Plan.

                  Section 14.3 RETROACTIVE EFFECT OF PLAN AMENDMENT.

                  (a)      No Plan amendment, unless it expressly provides
otherwise, shall be applied retroactively to increase the vested percentage of a
Participant whose Separation from the Service preceded the date such amendment
became effective unless and until he again becomes a Participant and additional
contributions are allocated to him.

                  (b)      No Plan amendment, unless it expressly provides
otherwise, shall be applied retroactively to increase the amount of service
credited to any person for purposes of Plan participation, vesting or any other
Plan purpose with respect to his participation or employment before the date
such amendment became effective.

                  (c)      Except as provided in subsections (a) and (b), all
rights under the Plan shall be determined under the terms of the Plan as in
effect at the time the determination is made.

                  Section 14.4 CONSOLIDATION OR MERGER, ADOPTION OF PLAN BY
OTHER COMPANIES.

                  (a)      In the event of the consolidation or merger of the
Company with or into any other business entity, or the sale by the Company or
its owner of its assets, the successor will be deemed to continue the Plan. If
deemed appropriate, the successor will execute a proper supplemental agreement
to the Trust Agreement with the Trustee.

                  (b)      The Plan shall not be merged or consolidated with any
other plan, nor shall its assets or liabilities be transferred to any other
plan, unless each Participant in this Plan would have immediately after the
merger, consolidation or transfer (if the plan in question were then terminated)
accounts which are equal to or greater in amount than his corresponding Accounts
under this Plan had the Plan been terminated immediately before the merger,
consolidation or transfer in accordance with Code Section 414(l) and ERISA
Section 208.

                                      -76-
<Page>

                  Section 14.5 ADOPTION OF PLAN BY COMPANY AFFILIATES.

                  (a)      Any Company Affiliate may, with the approval of the
Board, the HR Officer or her delegee, adopt the Plan as a whole company or as to
any one or more divisions by resolution of its own board of directors or
agreement of its partners or members.

                  (b)      By its adoption of the Plan, a Company Affiliate
shall be deemed to appoint the Company and Administrator its exclusive agents to
exercise on its behalf all of the power and authority conferred by this Plan
upon an Employer until the Plan is terminated with respect to the Employer and
relevant Trust Fund assets have been distributed.

                                      -77-
<Page>

                                        ARTICLE XV.
                            MISCELLANEOUS PROVISIONS

                  Section 15.1 IDENTIFICATION OF FIDUCIARIES.

                  (a)      The Administrator (with respect to control and
management of Plan assets and in general), the Company and the Committee shall
be named fiduciaries within the meaning of ERISA and, as permitted or required
by law, shall have exclusive authority and discretion to control and manage the
operation and administration of the Plan within the limits set forth in the
Trust Agreement, subject to proper delegation.

                  (b)      Such named fiduciaries and every person who exercises
any discretionary authority or discretionary control respecting management of
the Trust Fund or Plan, or exercises any authority or control respecting the
management or disposition of the assets of the Trust Fund or Plan, or renders
investment advice for compensation, direct or indirect, with respect to any
moneys or other property of the Trust Fund or Plan or has authority or
responsibility to do so, or has any discretionary authority or discretionary
responsibility in the administration of the Plan, and any person designated by a
named fiduciary to carry out fiduciary responsibilities under the Plan, shall be
a fiduciary and, as such, shall be subject to provisions of the Plan, the Trust
Agreement, ERISA and other applicable laws governing fiduciaries. Any person may
act in more than one fiduciary capacity.

                  Section 15.2 ALLOCATION OF FIDUCIARY RESPONSIBILITIES.

                  (a)      Fiduciary responsibilities under the Plan are
allocated as follows:

                           (i)      The sole power and discretion to manage and
control the Plan's assets including, but not limited to, the power to acquire
and dispose of Plan assets, is allocated to the Trustee, except to the extent
that another fiduciary is appointed in accordance with the Trust Agreement with
the power to control or manage (including the power to acquire and dispose of)
assets of the Plan.

                           (ii)     The sole duties, responsibilities and powers
allocated to the Company shall be those expressly retained under the Plan or the
Trust Agreement.

                           (iii)    All fiduciary responsibilities not allocated
to the Trustee, the Company or any investment manager are hereby allocated to
the Administrator, subject to delegation in accordance with Section 13.1(a)(xi).

                  (b)      Fiduciary responsibilities under the Plan (other than
the power to manage or control the Plan's assets) may be reallocated among those
fiduciaries identified as

                                      -78-
<Page>

named fiduciaries in Section 15.1 by amending the Plan, followed by such
fiduciaries' acceptance of, or operation under, such amended Plan.

                  (c)      No allocation of fiduciary responsibilities under the
Plan or Trust shall cause the Trust to cease being a domestic trust under Treas.
Reg. Sec. 301.7701.

                  Section 15.3 LIMITATION ON RIGHTS OF EMPLOYEES. The Plan is
strictly a voluntary undertaking on the part of the Company and shall not
constitute or be construed as a contract between the Employer and any Employee
or consideration for, or an inducement or condition of, the employment of an
Employee. Except as otherwise required by law, nothing contained in the Plan
shall give any Employee the right to be retained in the service of any Employer
or to interfere with or restrict the right of the Employer, which is hereby
expressly reserved, to discharge or retire any Employee at any time, with or
without notice and with or without cause and with or without obligation as to
any level of severance. Except as otherwise required by law, inclusion under the
Plan will not give any Employee any right or claim to employment or any benefit
hereunder except to the extent such right has specifically become fixed or
vested under the terms of the Plan and there are funds available therefor in the
hands of the Trustee.

                  Section 15.4 GOVERNING LAW. The Plan and Trust shall be
interpreted, administered and enforced in accordance with the Code and ERISA,
and the rights of Participants, Beneficiaries and all other persons shall be
determined in accordance therewith. However, to the extent that state law is
applicable, the laws of the State of Nevada shall apply.

                  Section 15.5 GENDER AND PLURALS. Where the context so
indicates, the masculine pronoun shall include the feminine, and the singular
shall include the plural.

                  Section 15.6 TITLES. Titles are provided herein for
convenience only and are not to serve as a basis for interpretation or
construction of the Plan.

                  Section 15.7 REFERENCES. Unless the context clearly indicates
to the contrary, a reference to a statute, regulation or document shall be
construed as referring to any subsequently amended, enacted, adopted or executed
statute, regulation or document.

                  Section 15.8 USE OF TRUST FUNDS.

                                      -79-
<Page>

                  Under no circumstances shall any contributions to the Trust or
any part of the Trust Fund be recoverable by the Employer from the Trustee or
from any Participant, his Beneficiaries or any other person, or be used for or
diverted to purposes other than for the exclusive purposes of providing benefits
to Participants and their Beneficiaries; provided, however, that

                  (a)      the contribution of the Employer for any Plan Year is
hereby conditioned upon its being deductible by the Employer for its fiscal year
in which such contribution was made and, to the extent disallowed as a deduction
under Code Section 404, such contribution shall be returned by the Trustee to
the Employer within one year after the final disallowance of the deduction by
the Internal Revenue Service or the courts; and

                  (b)      a contribution by the Employer or a Participant by a
mistake of fact shall be returned to the Employer or to the Participant in
question within one year after payment of the contribution was made.

                  Executed as of December 28, 2001.

                                     HARRAH'S ENTERTAINMENT, INC.

                                     By: /s/ ELAINE LO
                                     Its: VP Compensation and Benefits

                                      -80-
<Page>

                                                                      APPENDIX A

                             THE 2001 RESTATEMENT OF
                        THE HARRAH'S ENTERTAINMENT, INC.
                           SAVINGS AND RETIREMENT PLAN

                LIMITATIONS ON 401(K) AND AFTER TAX CONTRIBUTIONS

         Effective January 1, 2002.

         1.       A Participant's 401(k) Contributions may be from 2% to 20% (in
whole percentages) of his Compensation.

         2.       A Participant's After Tax Contributions may be from 2% to 20%
(in whole percentages) of his Compensation.

         3.       The combined 401(k) Contributions and After Tax Contributions
made by a Participant in the Plan Year may not exceed 20% of his Compensation.

                                      B-81
                                      B-81
<Page>

MONEY PURCHASE ACCOUNTS                                               APPENDIX B

                             THE 2001 RESTATEMENT OF
                        THE HARRAH'S ENTERTAINMENT, INC.
                           SAVINGS AND RETIREMENT PLAN

                        ANNUITY DISTRIBUTION OPTIONS FOR
                           THE MONEY PURCHASE ACCOUNTS

                  This Appendix B contains supplemental provisions relating
annuity distribution forms available to Participants with Money Purchase
Accounts.

                                   ARTICLE BI
                                   DEFINITIONS

                  Unless the context clearly indicates to the contrary, the
terms used herein with the first letter or letters capitalized shall have the
meaning specified below, or, if no definition is provided below, such terms
shall have the meaning specified in the Plan.

Section B1.1 ANNUITY PARTICIPANT. "Annuity Participant" shall mean any
Participant with a Money Purchase Account.

Section B1.2 ANNUITY STARTING DATE. "Annuity Starting Date" shall mean the first
day of the first period for which an amount is payable as an annuity or, in the
case of an amount not payable as an annuity, the first day on which all events
have occurred which entitle the Participant to a distribution.

Section B1.3 ELECTION PERIOD. "Election Period" means:

                  (a)      in the case of an election to waive the Joint and
Survivor Annuity, the period beginning 90 days before the Participant's Annuity
Starting Date and ending on the later of

                           (i)      the Participant's Annuity Starting Date, or

                           (ii)     the 60th day after the mailing or personal
         delivery to him of information he has requested under Section
         B.2.1(b)(ii).

                  (b)      in the case of an election to waive the qualified
preretirement survivor annuity,

                           (i)      by a former Participant who has had a
         Separation from the Service, the period which begins on the date of his
         Separation from the Service and ends on the date of his death, or

                           (ii)     otherwise, the period which begins on the
         first day of the

                                      B-82
                                      C-82
<Page>

         Plan Year in which the Participant attains age 35 and ends on the date
         of his death.

Section B1.4 JOINT AND SURVIVOR ANNUITY. "Joint and Survivor Annuity" shall mean
an annuity for the life of the Annuity Participant with a survivor annuity for
the life of his Surviving Spouse for 25%, 50%, 75% or 100% of the amount which
is payable during the joint lives of the Annuity Participant and his Spouse.
Unless a Participant elects otherwise, the Participant's Joint and Survivor
Annuity shall provide for a survivor benefit equal to 50% of the amount which is
payable during the joint lives of the Participant and his Surviving Spouse. The
Participant must have Spousal Consent to elect a Joint and 25% Survivor Annuity.

Section B1.5 LIFE ANNUITY. "Life Annuity" means an annuity for the life of the
Participant with no payments after death.

Section B1.6 QUALIFIED ELECTION. "Qualified Election" shall mean a written
waiver of a qualified Joint and Survivor Annuity or a qualified pre-retirement
survivor annuity with Spousal Consent. Additionally, a revocation of a prior
waiver may be made by the Annuity Participant without the consent of the Spouse
at any time before the commencement of benefits. A new waiver can be made
thereafter, but a new Spousal Consent will be required. The number of
revocations and waivers shall not be limited.

Section B1.7 TEN YEARS CERTAIN AND LIFE ANNUITY. "Ten Years Certain and Life
Annuity" means an annuity that provides for reduced monthly benefit commencing
on the Participant's Annuity Starting Date and payable during his lifetime,
ending with the last payment due on the first day of the month in which his
death occurs. Additionally, if the Participant dies within the ten-year period
following his Annuity Starting Date, payments shall continue to his Beneficiary
for the remainder of the ten-year period. In the event the Beneficiary dies
within the ten-year period and there is no contingent Beneficiary, the actuarial
equivalent of any remaining monthly payments shall be paid in a lump sum to the
Participant's estate.

                                   ARTICLE BII
                            DISTRIBUTION OF ACCOUNTS

SECTION B2.1 DISTRIBUTION OF ACCOUNTS

                  (a)      Subject to subsections (e) and (f), when an Annuity
Participant is entitled to a distribution under Section 11.1, the amount
credited to his Accounts shall be applied to purchase

                           (i)      if he is married, a Joint and Survivor
         Annuity,

                           (ii)     if he is not married, a Life Annuity.

Distribution of a Participant's Accounts in the form of a Joint and Survivor
Annuity shall

                                      C-83
<Page>

require the Participant's consent if such distribution commences prior to his
Normal Retirement Date.

                  (b)      Not less than 30 days, and not more than 90 days,
prior to his Annuity Starting Date, each Participant who may be affected by this
Section shall be furnished, by mail or personal delivery (and consistent with
such regulations as the Secretary may prescribe), with

                           (i)      a written explanation of the terms and
         conditions of the Joint and Survivor Annuity, including

                                    (A)      the right of the Participant to
make, and the effect of, an election under subsection (e) to waive the Joint and
Survivor Annuity,

                                    (B)      the relative financial effect on
his Accounts of an election under subsection (e),

                                    (C)      the right of the Participant's
Spouse under subsection (e), and

                                    (D)      the right of the Participant under
subsection (e) to revoke an election made under subsection (e) and the effect
thereof, and

                           (ii)     a statement that the Administrator will
         furnish the Participant upon his first written request within 60 days
         after the mailing or personal delivery to him of the notice required
         under this subsection, a detailed statement as to the financial effect
         upon his Accounts of making an election under subsection (e).

                  (c)      Notwithstanding subsection (b), if the Participant,
after having received the written explanation described in paragraph (b)(i),
affirmatively elects a form of distribution under subsection (e) with Spousal
Consent (if necessary), the distribution under subsection (e) may commence less
than 30 days after the written explanation described in paragraph (b)(i) was
provided to the Participant, provided the following requirements are met:

                           (i)      the Administrator provides information to
         the Participant clearly indicating that the Participant has the right
         to at least 30 days to consider whether to waive the automatic form of
         distribution under subsection (a) and consent to a form of distribution
         other than the automatic form of distribution,

                           (ii)     the Participant is permitted to revoke an
         affirmative distribution election at least until the date of
         commencement of the distribution, or, if later, at any time prior to
         the expiration of the 7-day period that begins the day after the
         explanation described in paragraph (b)(i) is provided to the
         Participant,

                                      C-84
<Page>

                           (iii)    the date of commencement of the distribution
         of the Participant's Accounts is after the date the explanation
         described in paragraph (b)(i) is provided to the Participant, and

                           (iv)     the distribution of the Participant's
         Accounts in accordance with the affirmative election does not commence
         before the expiration of the 7-day period that begins after the
         explanation described in paragraph (b)(i) is provided to the
         Participant.

                  (d)      The items furnished under subsection (b) shall be
written in non-technical language with the financial effects referred to being
given in terms of dollars per monthly payment. Such information shall be
delivered personally to the Participant or mailed to him (first class mail,
postage prepaid) within 30 days after receipt by the Administrator of such
written request.

                  (e)      Notwithstanding subsection (a), and subject to
subsection (e), if a Participant described in subsection (a) elects during the
applicable Election Period, with Spousal Consent, to waive such annuity in
accordance with the Rules of the Plan, such Participant may elect to receive the
amount credited to his Accounts under one of the following options:

                           (i)      a Life Annuity,

                           (ii)     a 10 year Certain and Life Annuity or

                           (iii)    payment in any other form available under
         Section 11.2.

Any such election may be revoked or made again at any time during the applicable
Election Period.

                  (f)      Notwithstanding subsections (a) and (e), if the
entire amount credited to a Participant's Accounts does not exceed $5,000 (and
did not exceed such amount under a prior withdrawal or distribution under the
Plan), such Participant shall receive the amount credited to his Accounts in
cash in one lump sum in accordance with paragraph (e)(iii).

                                  ARTICLE BIII
                               BENEFITS UPON DEATH

SECTION B3.1      DISTRIBUTION OF ACCOUNTS UPON DEATH

                  (a)      Subject to subsection (b), if a Participant dies
before any distribution of his Accounts has been made or commenced and was
married on the date of his death, all of the amount credited to his Accounts
shall be applied to purchase a qualified preretirement survivor annuity for the
life of his Surviving Spouse which shall commence on a date specified by the
Spouse which is not later than the later of

                                      C-85
<Page>

                           (i)      the first anniversary of the Participant's
         death, or

                           (ii)     the date on which the Participant would have
         attained age 70 1/2.

                  (b)      Notwithstanding subsection (a),

                           (i)      if a Former Participant or a Participant who
         is more than 35 years old elected to waive such qualified preretirement
         survivor annuity during the applicable Election Period in accordance
         with the Rules of Plan and obtained Spousal Consent, or

                           (ii)     if such Surviving Spouse, after the
         Participant's death, elects in accordance with the Rules of the Plan to
         waive the qualified preretirement survivor annuity to which such
         Surviving Spouse is otherwise entitled,

the amount credited to the Participant's Accounts shall be paid to the Surviving
Spouse in one of the methods permitted under Section 11.2 in accordance with
Section B3.3. Any election under paragraph (b) may be revoked or made again at
any time during the applicable Election Period.

                  (c)      (i)      Upon the death of a Participant who was not
         married on the date of his death, the amount credited to his Accounts
         shall be paid to his Beneficiary.

                           (ii)     Upon the death of a Participant who has not
         yet received the entirety of the distribution of his Accounts, any
         remaining balance of his distribution of his Accounts shall be paid, to
         his Beneficiary.

SECTION B3.2 - EXPLANATION OF QUALIFIED PRERETIREMENT SURVIVOR ANNUITY. The
Administrator shall provide a written explanation of the qualified preretirement
survivor annuity (as defined in Code Section 417(c)):

                  (a)      to a Participant who is a Participant on his
thirty-second birthday, within the three Plan Year period commencing with the
Plan Year in which his thirty-second birthday occurs;

                  (b)      to a Participant who becomes a Participant after his
thirty-second birthday, within the three Plan Year period commencing with the
Plan Year in which he becomes a Participant; and

                  (c)      to a Former Participant who has a Separation from the
Service prior to his thirty-second birthday, within one year of his Separation
from the Service,

or such longer period as is allowed under Code Section 417(a)(3).

                                      C-86
<Page>

Section B3.3 DISTRIBUTION UPON DEATH.

                  (a)      If an Annuity Participant dies before distribution of
his Accounts commences, then the vested balance of his Accounts shall be paid to
his Beneficiary in one of the available forms, as elected by the Beneficiary.
Payment to a Beneficiary must either: (1) be completed by the end of the
calendar year that contains the fifth anniversary of the Annuity Participant's
death or (2) begin by the end of the calendar year that contains the first
anniversary of the Annuity Participant's death and be completed within the
period of the Beneficiary's life or life expectancy, except that:

                           (i)      If the Surviving Spouse is the Beneficiary,
         payments need not begin until the later of (A) the end of the calendar
         year that includes the first anniversary of the Annuity Participant's
         death or (B) the end of the calendar year in which the Annuity
         Participant would have been required to commence payments under Section
         11.4 of the Plan, and must be completed within the Surviving Spouse's
         life or life expectancy; and

                           (ii)     If the Annuity Participant and the Surviving
         Spouse who is the Beneficiary die (A) before the date on which the
         Annuity Participant would have been required to begin payments under
         Section 11.4 of the Plan and (B) before payments have begun to the
         Surviving Spouse, the Surviving Spouse shall be treated as the Annuity
         Participant in applying these rules.

                  (b)      If payment has commenced prior to the Annuity
Participant's death, payment of the Annuity Participant's Accounts shall be made
in such manner that the remaining interest is distributed at least as rapidly as
under the method being used as of the date of the Annuity Participant's death.

                                      C-87
<Page>

                                                                      APPENDIX B

                             THE 2001 RESTATEMENT OF
                        THE HARRAH'S ENTERTAINMENT, INC.
                           SAVINGS AND RETIREMENT PLAN

                         MERGER OF THE RIO SUITES HOTEL
                       & CASINOS EMPLOYEE RETIREMENT PLAN

                  This Appendix C contains additional provisions of the Plan
relating to the merger of the Rio Plan into the Plan, effective as of January 3,
2000. Specifically, Appendix C contains provisions relating to the Accounts of
Plan Participants who were participants in the Rio Plan and who became
Participants in the Plan effective as of January 3, 2000. Effective June 18,
2001, annuities ceased to be a distribution option for any Rio Participant, and
this Appendix C will no longer be effective.

                                   ARTICLE CI.

                                   DEFINITIONS

                  Unless the context clearly indicates to the contrary, the
terms used herein with the first letter or letters capitalized shall have the
meaning specified below, or, if no definition is provided below, such terms
shall have the meaning specified in the Plan.

Section C1.1 ANNUITY STARTING DATE. "Annuity Starting Date" shall mean the first
day of the first period for which an amount is payable as an annuity or, in the
case of an amount not payable as an annuity, the first day on which all events
have occurred which entitle the Participant to a distribution.

Section C1.2 ELECTION PERIOD. "Election Period" means:

                  (a)      in the case of an election to waive the Joint and
Survivor Annuity, the period beginning 90 day before the Participant's Annuity
Starting Date and ending on the later of

                           (i)      the Participant's Annuity Starting Date, or

                           (ii)     the 60th day after the mailing or personal
         delivery to him of information he has requested under Section
         C.2.1(b)(ii).

                  (b)      in the case of an election to waive the qualified
preretirement survivor annuity,

                           (i)      by a former Participant who has had a
         Separation from the Service, the period which begins on the date of his
         Separation from the Service and ends on the date of his death, or

                           (ii)     otherwise, the period which begins on the
         first day of the

                                      B-88
<Page>

RIO PLAN                                                              APPENDIX C

         Plan Year in which the Participant attains age 35 and ends on the date
         of his death.

Section C1.4 JOINT AND SURVIVOR ANNUITY. "Joint and Survivor Annuity" shall mean
an annuity for the life of the Rio Participant with a survivor annuity for the
life of his Surviving Spouse which is not less than 50% and not more than 100%
of the amount which is payable during the joint lives of the Rio Participant and
his Spouse. Unless a Participant elects otherwise, the Participant's Joint and
Survivor Annuity shall provide for a survivor benefit equal to 50% of the amount
which is payable during the joint lives of the Participant and his Surviving
Spouse.

Section C1.5 LIFE ANNUITY. "Life Annuity" means an annuity for the life of the
Participant with no payments after death.

Section C1.6 QUALIFIED ELECTION. "Qualified Election" shall mean a written
waiver of a qualified Joint and Survivor Annuity or a qualified pre-retirement
survivor annuity with Spousal Consent. Additionally, a revocation of a prior
waiver may be made by the Rio Participant without the consent of the Spouse at
any time before the commencement of benefits. A new waiver can be made
thereafter, but a new Spousal Consent will be required. The number of
revocations and waivers shall not be limited.

Section C1.7 RIO PARTICIPANT. "Rio Participant" shall mean a Plan Participant
who was a participant in the Rio Plan and who became a Participant in the Plan
effective as of January 3, 2000.

                                  ARTICLE CII.

                            DISTRIBUTION OF ACCOUNTS

SECTION C2.1 DISTRIBUTION OF ACCOUNTS.

                  (a)      Subject to subsections (e) and (f), when a Rio
Participant is entitled to a distribution under Section 11.1, the amount
credited to his Accounts shall be applied to purchase

                           (i)      if he is married, a Joint and Survivor
         Annuity, or

                           (ii)     if he is not married, a Life Annuity.

Distribution of a Participant's Accounts in the form of a Joint and Survivor
Annuity shall require the Participant's consent if such distribution commences
prior to his Normal Retirement Date.

                  (b)      Not less than 30 days, and not more than 90 days,
prior to his Annuity Starting Date, each Participant who may be affected by this
Section shall be furnished, by mail or personal delivery (and consistent with
such regulations as the

                                      C-89
<Page>

Secretary may prescribe), with

                           (i)      a written explanation of the terms and
         conditions of the Joint and Survivor Annuity, including

                                    A        the right of the Participant to
                  make, and the effect of, an election under subsection (d) to
                  waive the Joint and Survivor Annuity,

                                    B        the relative financial effect on
                  his Accounts of an election under subsection (d),

                                    C        the right of the Participant's
                  Spouse under subsection (d), and

                                    D        the right of the Participant under
                  subsection (d) to revoke an election made under subsection (d)
                  and the effect thereof, and

                           (ii)     a statement that the Administrator will
         furnish the Participant upon his first written request within 60 days
         after the mailing or personal delivery to him of the notice required
         under this subsection, a detailed statement as to the financial effect
         upon his Accounts of making an election under subsection (d).

                  (c)      Notwithstanding subsection (b), if the Participant,
after having received the written explanation described in paragraph (b)(i),
affirmatively elects a form of distribution under subsection (e) with Spousal
Consent (if necessary), the distribution under subsection (e) may commence less
than 30 days after the written explanation described in paragraph (b)(i) was
provided to the Participant, provided the following requirements are met:

                           (i)      the Administrator provides information to
         the Participant clearly indicating that the Participant has the right
         to at least 30 days to consider whether to waive the automatic form of
         distribution under subsection (a) and consent to a form of distribution
         other than the automatic form of distribution,

                           (ii)     the Participant is permitted to revoke an
         affirmative distribution election at least until the date of
         commencement of the distribution, or, if later, at any time prior to
         the expiration of the 7-day period that begins the day after the
         explanation described in paragraph (b)(i) is provided to the
         Participant,

                           (iii)    the date of commencement of the distribution
         of the Participant's Accounts is after the date the explanation
         described in paragraph (b)(i) is provided to the Participant, and

                           (iv)     the distribution of the Participant's
         Accounts in accordance

                                      C-90
<Page>

         with the affirmative election does not commence before the expiration
         of the 7-day period that begins after the explanation described in
         paragraph (b)(i) is provided to the Participant.

                  (d)      The items furnished under subsection (b) shall be
written in non-technical language with the financial effects referred to being
given in terms of dollars per monthly payment. Such information shall be
delivered personally to the Participant or mailed to him (first class mail,
postage prepaid) within 30 days after receipt by the Administrator of such
written request.

                  (e)      Notwithstanding subsection (a), and subject to
subsection (e), if a Participant described in subsection (a) elects during the
applicable Election Period, with Spousal Consent, to waive such annuity in
accordance with the Rules of the Plan, such Participant may elect to receive the
amount credited to his Accounts under one of the following options:

                           (i)      a Life Annuity, or

                           (ii)     payment in any other form available under
         Section 11.2.

Any such election may be revoked or made again at any time during the applicable
Election Period.

                  (f)      Notwithstanding subsections (a) and (e), if the
entire amount credited to a Participant's Accounts does not exceed $5,000 (and
did not exceed such amount under a prior withdrawal or distribution under the
Plan), such Participant shall receive the amount credited to his Accounts in
cash in one lump sum in accordance with paragraph (e)(i).

                                  ARTICLE CIII.

                               BENEFITS UPON DEATH

SECTION C3.1 DISTRIBUTION OF ACCOUNTS UPON DEATH

                  (a)      Subject to subsection (b), if a Participant dies
before any distribution of his Accounts has been made or commenced and was
married on the date of his death, all of the amount credited to his Accounts
shall be applied to purchase a qualified preretirement survivor annuity for the
life of his Surviving Spouse which shall commence on a date specified by the
Spouse which is not later than the later of

                           (i)      the first anniversary of the Participant's
         death, or

                           (ii)     the date on which the Participant would have
         attained age 70 1/2.

                                      C-91
<Page>

                  (b)      Notwithstanding subsection (a),

                           (i)      if a Former Participant or a Participant who
         is more than 35 years old elected to waive such qualified preretirement
         survivor annuity during the applicable Election Period in accordance
         with the Rules of Plan and obtained Spousal Consent, or

                           (ii)     if such Surviving Spouse, after the
         Participant's death, elects in accordance with the Rules of the Plan to
         waive the qualified preretirement survivor annuity to which such
         Surviving Spouse is otherwise entitled,

the amount credited to the Participant's Accounts shall be paid to the Surviving
Spouse in one of the methods permitted under Section 11.2 in accordance with
Section C3.3. Any election under paragraph (b) may be revoked or made again at
any time during the applicable Election Period.

                  (c)      (i)      Upon the death of a Participant who was not
         married on the date of his death, the amount credited to his Accounts
         shall be paid to his Beneficiary.

                           (ii)     Upon the death of a Participant who has not
         yet received the entirety of the distribution of his Accounts, any
         remaining balance of his distribution of his Accounts shall be paid, to
         his Beneficiary.

Section C3.2 EXPLANATION OF QUALIFIED PRERETIREMENT SURVIVOR ANNUITY. The
Administrator shall provide a written explanation of the qualified preretirement
survivor annuity (as defined in Code Section 417(c)):

                  (a)      to a Participant who is a Participant on his 32nd
birthday, within the three-Plan Year period commencing with the Plan Year in
which his 32nd birthday occurs;

                  (b)      to a Participant who becomes a Participant after his
32nd birthday, within the three-Plan Year period commencing with the Plan Year
in which he becomes a Participant; and

                  (c)      to a Former Participant who has a Separation from the
Service prior to his 32nd birthday, within one year of his Separation from the
Service,

or such longer period as is allowed under Code Section 417(a)(3).

Section C3.3 DISTRIBUTION UPON DEATH.

                  (a)      If a Rio Participant dies before distribution of his
Accounts commences, then the vested balance of his Accounts shall be paid to his
Beneficiary in one of the available forms, as elected by the Beneficiary.
Payment to a Beneficiary

                                      C-92
<Page>

must either: (1) be completed by the end of the calendar year that contains the
fifth anniversary of the Rio Participant's death or (2) begin by the end of the
calendar year that contains the first anniversary of the Rio Participant's death
and be completed within the period of the Beneficiary's life or life expectancy,
except that:

                           (i)      If the Surviving Spouse is the Beneficiary,
         payments need not begin until the later of (A) the end of the calendar
         year that includes the first anniversary of the Rio Participant's death
         or (B) the end of the calendar year in which the Rio Participant would
         have been required to commence payments under Section 11.4 of the Plan,
         and must be completed within the Surviving Spouse's life or life
         expectancy; and

                           (ii)     If the Rio Participant and the Surviving
         Spouse who is the Beneficiary die (A) before the date on which the Rio
         Participant would have been required to begin payments under Section
         11.4 of the Plan and (B) before payments have begun to the Surviving
         Spouse, the Surviving Spouse shall be treated as the Rio Participant in
         applying these rules.

                  (b)      If payment has commenced prior to the Rio
Participant's death, payment of the Rio Participant's Accounts shall be made in
such manner that the remaining interest is distributed at least as rapidly as
under the method being used as of the date of the Rio Participant's death.

                                      C-93<Page>

Exhibit 10.1

                             VALMONT 2002 STOCK PLAN

                                    SECTION 1

                                NAME AND PURPOSE

          1.1  NAME. The name of the plan shall be the Valmont 2002 Stock Plan
(the "Plan").

          1.2. PURPOSE OF PLAN. The purpose of the Plan is to foster and promote
the long-term financial success of the Company and increase stockholder value by
(a) motivating superior performance by means of stock incentives, (b)
encouraging and providing for the acquisition of an ownership interest in the
Company by Employees and (c) enabling the Company to attract and retain the
services of a management team responsible for the long-term financial success of
the Company.

                                    SECTION 2

                                   DEFINITIONS

          2.1  DEFINITIONS. Whenever used herein, the following terms shall have
the respective meanings set forth below:

          (a)  "Act" means the Securities Exchange Act of 1934, as amended.

          (b)  "Award" means any Option, Stock Appreciation Right, Restricted
               Stock, Stock Bonus, or any combination thereof granted under the
               Plan, including Awards combining two or more types of Awards in a
               single grant.

          (c)  "Board" means the Board of Directors of the Company.

          (d)  "Code" means the Internal Revenue Code of 1986, as amended.

          (e)  "Committee" means the Compensation Committee of the Board, which
               shall consist of two or more members, each of whom shall be a
               "non-employee director" within the meaning of Rule 16b-3 as
               promulgated under the Act.

          (f)  "Company" means Valmont Industries, Inc., a Delaware corporation
               (and any successor thereto) and its Subsidiaries.

          (g)  "Director Award" means an award of Stock and an annual Award of a
               Nonstatutory Stock Option granted to each Eligible Director
               pursuant to Section 7.1 without any action by the Board or the
               Committee.

          (h)  "Eligible Director" means a person who is serving as a member of
               the Board and who is not an Employee.

          (i)  "Employee" means any employee of the Company or any of its
               Subsidiaries.

          (j)  "Fair Market Value" means, on any date, the average of the
               high and low sales prices of the Stock as reported on the
               National Association of Securities Dealers Automated Quotation
               system (or on such other recognized market or quotation system
               on which the trading prices of the Stock are traded or quoted
               at the relevant time) on such date. In the event that there
               are no Stock transactions reported on such system (or such
               other system) on such

<Page>

               date, Fair Market Value shall mean the average of the high and
               low sale prices on the immediately preceding date on which
               Stock transactions were so reported.

          (k)  "Option" means the right to purchase Stock at a stated price for
               a specified period of time. For purposes of the Plan, an Option
               may be either (i) an Incentive Stock Option within the meaning of
               Section 422 of the Code or (ii) a Nonstatutory Stock Option.

          (l)  "Participant" means any person designated by the Committee to
               participate in the Plan.

          (m)  "Plan" means the Valmont 2002 Stock Plan, as in effect from time
               to time.

          (n)  "Restricted Stock" shall mean a share of Stock granted to a
               Participant subject to such restrictions as the Committee may
               determine.

          (o)  "Stock" means the Common Stock of the Company, par value $1.00
               per share.

          (p)  "Stock Appreciation Right" means the right, subject to such terms
               and conditions as the Committee may determine, to receive an
               amount in cash or Stock, as determined by the Committee, equal to
               the excess of (i) the Fair Market Value, as of the date such
               Stock Appreciation Right is exercised, of the number shares of
               Stock covered by the Stock Appreciation Right being exercised
               over (ii) the aggregate exercise price of such Stock Appreciation
               Right.

          (q)  "Stock Bonus" means the grant of Stock as compensation from the
               Company in lieu of cash salary or bonuses otherwise payable to
               the Participant, and stock issued for service awards and other
               similar employee recognition programs.

          (r)  "Subsidiary" means any corporation or partnership in which the
               Company owns, directly or indirectly, 50% or more of the total
               combined voting power of all classes of stock of such corporation
               or of the capital interest or profits interest of such
               partnership.

          2.2  GENDER AND NUMBER. Except when otherwise indicated by the
context, words in the masculine gender used in the Plan shall include the
feminine gender, the singular shall include the plural, and the plural shall
include the singular.

                                    SECTION 3

                          ELIGIBILITY AND PARTICIPATION

          Except as otherwise provided in Sections 5.1 and 7.1, the only persons
eligible to participate in the Plan shall be those Employees selected by the
Committee as Participants.

                                      -2-

<Page>

                                    SECTION 4

                             POWERS OF THE COMMITTEE

          4.1 POWER TO GRANT. The Committee shall determine the Participants to
whom Awards shall be granted, the type or types of Awards to be granted, and the
terms and conditions of any and all such Awards. The Committee may establish
different terms and conditions for different types of Awards, for different
Participants receiving the same type of Awards, and for the same Participant for
each Award such Participant may receive, whether or not granted at different
times.

          4.2 ADMINISTRATION. The Committee shall be responsible for the
administration of the Plan. The Committee, by majority action thereof, is
authorized to prescribe, amend, and rescind rules and regulations relating to
the Plan, to provide for conditions deemed necessary or advisable to protect the
interests of the Company, and to make all other determinations necessary or
advisable for the administration and interpretation of the Plan in order to
carry out its provisions and purposes. Determinations, interpretations, or other
actions made or taken by the Committee pursuant to the provisions of the Plan
shall be final, binding, and conclusive for all purposes and upon all persons.

                                    SECTION 5

                              STOCK SUBJECT TO PLAN

          5.1 NUMBER. Subject to the provisions of Section 5.3, the number of
shares of Stock subject to Awards (including Director Awards) under the Plan may
not exceed 1,700,000 shares of Stock. The shares to be delivered under the Plan
may consist, in whole or in part, of treasury Stock or authorized but unissued
Stock, not reserved for any other purpose. The maximum number of shares of Stock
with respect to which Awards may be granted to any one Employee under the Plan
is 40% of the aggregate number of shares of Stock available for Awards under
Section 5.1. A maximum of 20% of the shares of Stock available for issuance
under the Plan may be issued as Restricted Stock or Stock Bonuses. In addition,
a maximum of 50,000 shares available for issuance under the Plan may be issued
to non-employee consultants.

          5.2 CANCELLED, TERMINATED OR FORFEITED AWARDS. Any shares of Stock
subject to an Award which for any reason are cancelled, terminated or otherwise
settled without the issuance of any Stock shall again be available for Awards
under the Plan. In the event that an Award is exercised through the delivery of
Stock or in the event that withholding tax liabilities arising from such Award
are satisfied by the withholding of Stock by the Company, the number of shares
available for Awards under the Plan shall be increased by the number of shares
surrendered or withheld.

          5.3 ADJUSTMENT IN CAPITALIZATION. In the event of any Stock dividend
or Stock split, recapitalization (including, without limitation, the payment of
an extraordinary dividend), merger, consolidation, combination, spin-off,
distribution of assets to stockholders, exchange of shares, or other similar
corporate transaction or event, (i) the aggregate number of shares of Stock
available for Awards under Section 5.1 and (ii) the number of shares and
exercise price with respect to Options and the number, prices and dollar value
of other Awards, shall be appropriately adjusted by the Committee, whose
determination shall be conclusive. If, pursuant to the preceding sentence, an
adjustment is made to the number of shares of Stock authorized for issuance

                                      -3-

<Page>

under the Plan, a corresponding adjustment shall be made with respect to
Director Awards granted pursuant to Section 7.1.

                                    SECTION 6

                                  STOCK OPTIONS

          6.1 GRANT OF OPTIONS. Options may be granted to Participants at such
time or times as shall be determined by the Committee. Options granted under the
Plan may be of two types: (i) Incentive Stock Options and (ii) Nonstatutory
Stock Options. The Committee shall have complete discretion in determining the
number of Options, if any, to be granted to a Participant. Each Option shall be
evidenced by an Option agreement that shall specify the type of Option granted,
the exercise price, the duration of the Option, the number of shares of Stock to
which the Option pertains, the exercisability (if any) of the Option in the
event of death, retirement, disability or termination of employment, and such
other terms and conditions not inconsistent with the Plan as the Committee shall
determine. Options may also be granted in replacement of or upon assumption of
options previously issued by companies acquired by the Company by merger or
stock purchase, and any options so replaced or assumed may have the same terms
including exercise price as the options so replaced or assumed.

          6.2 OPTION PRICE. Nonstatutory Stock Options and Incentive Stock
Options granted pursuant to the Plan shall have an exercise price which is not
less than the Fair Market Value on the date the Option is granted.

          6.3 EXERCISE OF OPTIONS. Options awarded to a Participant under the
Plan shall be exercisable at such times and shall be subject to such
restrictions and conditions as the Committee may impose, subject to the
Committee's right to accelerate the exercisability of such Option in its
discretion. Notwithstanding the foregoing, no Option shall be exercisable for
more than ten years after the date on which it is granted.

          6.4 PAYMENT. The Committee shall establish procedures governing the
exercise of Options, which shall require that written notice of exercise be
given and that the Option price be paid in full in cash or cash equivalents,
including by personal check, at the time of exercise or pursuant to any
arrangement that the Committee shall approve. The Committee may, in its
discretion, permit a Participant to make payment (i) by tendering, either by
actual delivery of shares or by attestation, shares of Stock already owned by
the Participant valued at its Fair Market Value on the date of exercise (if such
Stock has been owned by the Participant for at least six months) or (ii) by
electing to have the Company retain Stock which would otherwise be issued on
exercise of the Option, valued at its Fair Market Value on the date of exercise.
As soon as practicable after receipt of a written exercise notice and full
payment of the exercise price, the Company shall deliver to the Participant a
certificate or certificates representing the acquired shares of Stock. The
Committee may permit a Participant to elect to pay the exercise price upon the
exercise of an Option by irrevocably authorizing a third party to sell shares of
Stock (or a sufficient portion of the shares) acquired upon exercise of the
Option and remit to the Company a sufficient portion of the sale proceeds to pay
the entire exercise price and any required tax withholding resulting from such
exercise.

          6.5 INCENTIVE STOCK OPTIONS. Notwithstanding anything in the Plan to
the contrary, no term of this Plan relating to Incentive Stock Options shall be
interpreted, amended or altered, nor shall any discretion or authority granted
under the Plan be so exercised, so as to disqualify the Plan under Section 422
of the Code, or, without the consent of any Participant affected thereby, to

                                      -4-

<Page>

cause any Incentive Stock Option previously granted to fail to qualify for the
Federal income tax treatment afforded under Section 421 of the Code.

          6.6 REPLACEMENT OPTIONS. The Committee may grant a replacement option
(a "Replacement Option") to any Employee who exercises all or part of an option
granted under this Plan using Qualifying Stock (as herein defined) as payment
for the purchase price. A Replacement Option shall grant to the Employee the
right to purchase, at the Fair Market Value as of the date of said exercise and
grant, the number of shares of stock equal to the sum of the number of whole
shares (i) used by the Employee in payment of the purchase price for the option
which was exercised and (ii) used by the Employee in connection with applicable
withholding taxes on such transaction. A Replacement Option may not be exercised
for six months following the date of grant, and shall expire on the same date as
the option which it replaces. Qualifying Stock is stock which has been owned by
the Employee for at least six months prior to the date of exercise and has not
been used in a stock-for-stock swap transaction within the preceding six months.

                                    SECTION 7

                                 DIRECTOR AWARDS

          7.1 AMOUNT OF AWARD. Each Eligible Director shall receive a
non-discretionary Award of 2,000 shares of stock each year; such Award shall be
made annually on the date of and following completion of the Company's annual
stockholders' meeting (commencing with the 2002 annual stockholders' meeting).
Each Eligible Director shall be issued a common stock certificate for such
number of shares. Termination of the director's services for any reason other
than (i) death, (ii) retirement from the Board at mandatory retirement age, or
(iii) resignation or failure to stand for re-election, in any such case with the
prior approval of the Board, will result in forfeiture of the Stock. If the
Stock is forfeited, the director shall return the number of forfeited shares of
Stock, or equivalent value, to the Company. The number of shares of Stock
awarded to an Eligible Director annually shall be appropriately adjusted in the
event of any stock changes as described in Section 5.3. In addition, each
Eligible Director shall receive a non-discretionary Award of a Nonqualified
Stock Option for 4,000 shares of Stock exercisable at the Fair Market Value of
the Company's common stock on the date of grant; such Award shall be made
annually on the date of and following completion of the Company's annual
stockholders' meeting (commencing with the 2002 annual stockholders' meeting).
The number of nonqualified options awarded to a director shall be appropriately
adjusted in the event of any stock changes as described in Section 5.3.

          7.2 NO OTHER AWARDS. An Eligible Director shall not receive any other
Award under the Plan.

                                    SECTION 8

                            STOCK APPRECIATION RIGHTS

          8.1 SAR'S IN TANDEM WITH OPTIONS. Stock Appreciation Rights may be
granted to Participants in tandem with any Option granted under the Plan, either
at or after the time of the grant of such Option, subject to such terms and
conditions, not inconsistent with the provisions of the Plan, as the Committee
shall determine. Each Stock Appreciation Right shall only be exercisable to the
extent that the corresponding Option is exercisable, and shall terminate upon
termination or exercise of the corresponding Option.

                                      -5-

<Page>

Upon the exercise of any Stock Appreciation Right, the corresponding Option
shall terminate.

          8.2 OTHER STOCK APPRECIATION RIGHTS. Stock Appreciation Rights may
also be granted to Participants separately from any Option, subject to such
terms and conditions, not inconsistent with the provisions of the Plan, as the
Committee shall determine.

                                      -6-

<Page>

                                    SECTION 9

                                RESTRICTED STOCK

          9.1 GRANT OF RESTRICTED STOCK. The Committee may grant Restricted
Stock to Participants at such times and in such amounts, and subject to such
other terms and conditions not inconsistent with the Plan as it shall determine.
Each grant of Restricted Stock shall be subject to such restrictions, which may
relate to continued employment with the Company, performance of the Company, or
other restrictions, as the Committee may determine. Each grant of Restricted
Stock shall be evidenced by a written agreement setting forth the terms of such
Award.

          9.2 REMOVAL OF RESTRICTIONS. The Committee may accelerate or waive
such restrictions in whole or in part at any time in its discretion.

                                   SECTION 10

                                  STOCK BONUSES

          10.1 GRANT OF STOCK BONUSES. The Committee may grant a Stock Bonus to
a Participant at such times and in such amounts, and subject to such other terms
and conditions not inconsistent with the Plan, as it shall determine.

                                   SECTION 11

                AMENDMENT, MODIFICATION, AND TERMINATION OF PLAN

          11.1 GENERAL. The Board may from time to time amend, modify or
terminate any or all of the provisions of the Plan, subject to the provisions of
this Section 11.1. The Board may not change the Plan in a manner which would
prevent outstanding Incentive Stock Options granted under the Plan from being
Incentive Stock Options without the written consent of the optionees concerned.
Furthermore, the Board may not make any amendment which would (i) materially
modify the requirements for participation in the Plan, (ii) increase the number
of shares of Stock subject to Awards under the Plan or to any one Employee
pursuant to Section 5.1, or (iii) change the minimum exercise price for stock
options as provided in Section 6.2, in each case without the approval of a
majority of the outstanding shares of Stock entitled to vote thereon. No
amendment or modification shall affect the rights of any Employee with respect
to a previously granted Award, nor shall any amendment or modification affect
the rights of any Eligible Director pursuant to a previously granted Director
Award.

          11.2 TERMINATION OF PLAN. No further Options shall be granted under
the Plan subsequent to December 31, 2012, or such earlier date as may be
determined by the Board.

                                   SECTION 12

                            MISCELLANEOUS PROVISIONS

          12.1 NONTRANSFERABILITY OF AWARDS. Except as otherwise provided by the
Committee, Awards under the Plan are not transferable, except by will or by the
laws of descent and distribution.

          12.2 BENEFICIARY DESIGNATION. Each Participant under the Plan may from
time to time name any beneficiary or beneficiaries (who may be named

                                      -7-

<Page>

contingent or successively) to whom any benefit under the Plan is to be paid or
by whom any right under the Plan is to be exercised in case of his death. Each
designation will revoke all prior designations by the same Participant shall be
in a form prescribed by the Committee, and will be effective only when filed in
writing with the Company. In the absence of any such designation, Awards
outstanding at death may be exercised by the Participant's surviving spouse, if
any, or otherwise by his estate.

          12.3 NO GUARANTEE OF EMPLOYMENT OR PARTICIPATION. Nothing in the Plan
shall interfere with or limit in any way the right of the Company or any
Subsidiary to terminate any Participant's employment at any time, nor confer
upon any Participant any right to continue in the employ of the Company or any
Subsidiary. No Employee shall have a right to be selected as a Participant, or,
having been so selected, to receive any future Awards.

          12.4 TAX WITHHOLDING. The Company shall have the power to withhold, or
require a Participant or Eligible Director to remit to the Company, an amount
sufficient to satisfy federal, state, and local withholding tax requirements on
any Award under the Plan, and the Company may defer issuance of Stock until such
requirements are satisfied. The Committee may, in its discretion, permit a
Participant to elect, subject to such conditions as the Committee shall impose,
(i) to have shares of Stock otherwise issuable under the Plan withheld by the
Company or (ii) to deliver to the Company previously acquired shares of Stock,
in each case having a Fair Market Value sufficient to satisfy all or part of the
Participant's estimated total federal, state and local tax obligation associated
with the transaction.

          12.5 CHANGE OF CONTROL. On the date of a Change of Control, all
outstanding options and stock appreciation rights shall become immediately
exercisable and all restrictions with respect to Restricted Stock shall lapse.
"Change of Control" shall mean:

          (i)   The acquisition (other than from the Company) by any person,
                entity or "group", within the meaning of Section 13(d)(3) or
                14(d)(2) of the Act (excluding any acquisition or holding by (i)
                the Company or its subsidiaries, (ii) any employee benefit plan
                of the Company or its subsidiaries which acquires beneficial
                ownership of voting securities of the Company and (iii) Robert
                B. Daugherty, his successors and assigns and any tax-exempt
                entity established by him) of beneficial ownership (within the
                meaning of Rule 13d-3 promulgated under the Act) of 50% or more
                of either the then outstanding shares of common stock or the
                combined voting power of the Company's then outstanding voting
                securities entitled to vote generally in the election of
                directors; or

          (ii)  Individuals who, as of the date hereof, constitute the Board (as
                of the date hereof the "Incumbent Board") cease for any reason
                to constitute at least a majority of the Board, provided that
                any person becoming a director subsequent to the date hereof
                whose election, or nomination for the election by the Company's
                stockholders, was approved by a vote of at least a majority of
                the directors then comprising the Incumbent Board shall be, for
                purposes of this Plan, considered as though such person were a
                member of the Incumbent Board; or

          (iii) Consummation of a reorganization, merger or consolidation,
                approved by the stockholders of the Company, in which the
                Company is not the surviving entity and with respect to which
                persons who were the stockholders of the Company immediately
                prior to such reorganization, merger or consolidation do not,
                immediately thereafter, own more than 50% of the combined voting
                power entitled

                                      -8-

<Page>

                to vote generally in the election of directors of the
                reorganized, merged or consolidated company's then outstanding
                voting securities, or a liquidation or dissolution of the
                Company or of the sale of all or substantially all of the assets
                of the Company.

          12.6  AGREEMENTS WITH COMPANY. An Award under the Plan shall be
                subject to such terms and conditions, not inconsistent with the
                Plan, as the Committee may, in its sole discretion, prescribe.
                The terms and conditions of any Award to any Participant shall
                be reflected in such form of written document as is determined
                by the Committee or its designee.

          12.7 COMPANY INTENT. The Company intends that the Plan comply in all
respects with Rule 16b-3 under the Act, and any ambiguities or inconsistencies
in the construction of the Plan shall be interpreted to give effect to such
intention.

          12.8 REQUIREMENTS OF LAW. The granting of Awards and the issuance of
shares of Stock shall be subject to all applicable laws, rules, and regulations,
and to such approvals by any governmental agencies or securities exchanges as
may be required.

          12.9 EFFECTIVE DATE. The Plan shall be effective upon its adoption by
the Board subject to approval by the Company's stockholders at the 2002 annual
stockholders' meeting.

          12.10 GOVERNING LAW. The Plan, and all agreements hereunder, shall be
construed in accordance with and governed by the laws of the State of Delaware.

                                      -9-

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