Document:

Exhibit 10.32

                              AMENDED AND RESTATED
                        EMPLOYMENT CONTINUATION AGREEMENT

                        THIS AMENDED AND RESTATED AGREEMENT by and among John
Hancock Life Insurance Company, a Massachusetts corporation (the "Company"),
John Hancock Financial Services, Inc., a Delaware corporation ("JHFS") and Wayne
A. Budd (the "Executive"), dated as of the 15th day of October, 2001.

                              W I T N E S S E T H :

      WHEREAS, the Executive has been employed as an officer of the Company
and/or JHFS, and it has been determined that the Executive holds an important
position with the Company and/or JHFS;

      WHEREAS, the Company and JHFS believe that, in the event of a situation
that could result in a change in ownership or control of the Company or JHFS,
continuity of management will be essential to their ability to evaluate and
respond to such a situation in the best interests of shareholders;

      WHEREAS, the Company and JHFS understand that any such situation will
present significant concerns for the Executive with respect to his/her financial
and job security;

      WHEREAS, to assure themselves of the Executive's services during the
period in which they are confronting such a situation, and to provide the
Executive certain financial assurances to enable the Executive to perform the
responsibilities of his/her position without undue distraction and to exercise
his/her judgment without bias due to his/her personal circumstances, the
Company, JHFS and the Executive previously entered into this Agreement to
provide the Executive with certain rights and obligations upon the occurrence of
a Change of Control or Potential Change of Control (as each such term is defined
in Section 2 hereof);

      WHEREAS, the Executive, the Company and JHFS have determined that the
Agreement should be amended and restated to further clarify and refine benefits
and protections provided to the Executive in the event of a Change of Control or
Potential Change of Control;

      NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is hereby agreed by and among the Company, JHFS and the
Executive as follows:

      1. Operation of Agreement. (a) Effective Date. The effective date of this
Agreement shall be the date on which a Change of Control occurs (the "Effective
Date"), provided that, except as provided in Section 1(b), if the Executive is
not employed by the Company, JHFS or an Affiliate on the Effective Date, this
Agreement shall be void and without effect.

      (b) Termination of Employment Following a Potential Change of Control.
Notwithstanding Section 1(a), if (i) the Executive's employment with the
Company, JHFS or an Affiliate is terminated without Cause (as defined in Section
6(c)) after the occurrence of a Potential Change of Control and prior to the
occurrence of a Change of Control and (ii) a Change of Control occurs within two
years of such termination, the Executive shall be deemed, solely for purposes of
determining his/her rights under this Agreement, to have remained employed until
the date such Change of Control occurs and to have been terminated by the
Company, JHFS or (if applicable) the Affiliate without Cause immediately after
this Agreement becomes effective, with any amounts payable hereunder reduced by
the amount of any other severance benefits provided to him in connection with
such termination.

      2. Definitions.

      (a) "Affiliate" shall mean any corporation, partnership, limited liability
company, trust or other entity which directly, or indirectly through one or more
intermediaries, controls, or is controlled by, the Company, or JHFS.

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      (b) "Board" shall mean the Board of Directors of the Company.

      (c) "Company" means John Hancock Life Insurance Company.

      (d) "Change of Control" shall be deemed to have occurred if:

            (i) any Person (as defined below) has acquired, "beneficial
      ownership" (within the meaning of Rule 13d-3, as promulgated under Section
      13(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
      Act")), directly or indirectly, of securities of the Company or JHFS
      representing 30% or more of the combined Voting Power (as defined below)
      of the securities of the Company or JHFS; provided, however, that the
      event described in this paragraph (i) shall not be deemed to be a Change
      in Control by virtue of an acquisition by any employee benefit plan (or
      related trust) sponsored or maintained by the Company, JHFS or any
      Affiliate; or

            (ii) within any 24-month period, the persons who, at the beginning
      of such period, were members of the Board (the "Incumbent Company
      Directors") shall cease to constitute at least a majority of the Board or
      the board of directors of any successor to the Company; provided, however,
      that any director elected to the Board, or nominated for election to the
      Board, by at least two-thirds (2/3) of the Incumbent Company Directors
      then still in office shall be deemed to be an Incumbent Company Director
      for purposes of this subclause (ii); provided, however, that no individual
      initially elected or nominated for election to the Board as a result of an
      actual or threatened election contest with respect to directors or as a
      result of any other actual or threatened solicitation of proxies by or on
      behalf of any Person other than the Board shall be deemed to be an
      Incumbent Company Director; or

            (iii) within any 24-month period, the persons who, at the beginning
      of such period, were members of the JHFS Board (the "Incumbent JHFS
      Directors") shall cease to constitute at least a majority of the JHFS
      Board or the board of directors of any successor to JHFS; provided,
      however, that any director elected to the JHFS Board, or nominated for
      election to the JHFS Board, by at least two-thirds of the Incumbent JHFS
      Directors then still in office shall be deemed to be an Incumbent JHFS
      Director for purposes of this subclause (iii); provided, however, that no
      individual initially elected or nominated for election to the JHFS Board
      as a result of an actual or threatened election contest with respect to
      directors or as a result of any other actual or threatened solicitation of
      proxies by or on behalf of any Person other than the JHFS Board shall be
      deemed to be an Incumbent JHFS Director; or

            (iv) upon the consummation of a merger, consolidation, share
      exchange, division, sale or other disposition of all or substantially all
      of the assets of the Company (a "Company Corporate Event") and immediately
      following the consummation of which the stockholders of the Company,
      immediately prior to such Company Corporate Event do not hold, directly or
      indirectly, a majority of the Voting Power of

                  (A)   in the case of a merger or consolidation, the surviving
                        or resulting corporation,

                  (B)   in the case of a statutory share exchange, the acquiring
                        corporation,

                  (C)   in the case of a division or a sale or other disposition
                        of assets, each surviving, resulting or acquiring
                        corporation which, immediately following the relevant
                        Company Corporate Event, holds more than 25% of the
                        consolidated assets of the Company immediately prior to
                        such Company Corporate Event, provided that no Change of
                        Control shall be deemed to have occurred if the
                        Executive is employed, immediately following such
                        Company Corporate Event, by any entity in which the
                        stockholders of the Company immediately prior to such
                        Company Corporate Event hold, directly or indirectly, a
                        majority of the Voting Power;

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      Provided that in each case such majority of the Voting Power is
      represented by securities of the Company that were outstanding immediately
      prior to such Company Corporate Event (or, if applicable, is represented
      by shares into which such securities of the Company were converted
      pursuant to such Company Corporate Event); or

            (v) upon the consummation of a merger, consolidation, share
      exchange, division, sale or other disposition of all or substantially all
      of the assets of JHFS which has been approved by the stockholders of JHFS
      (a "JHFS Corporate Event"), and immediately following the consummation of
      which the stockholders of JHFS immediately prior to such JHFS Corporate
      Event do not hold, directly or indirectly, a majority of the Voting Power
      of

                  (A)   in the case of a merger or consolidation, the surviving
                        or resulting corporation,

                  (B)   in the case of a statutory share exchange, the acquiring
                        corporation, or

                  (C)   in the case of a division or a sale or other disposition
                        of assets, each surviving, resulting or acquiring
                        corporation which, immediately following the relevant
                        JHFS Corporate Event, holds more than 25% of the
                        consolidated assets of JHFS immediately prior to such
                        JHFS Corporate Event, provided that no Change of Control
                        shall be deemed to have occurred if the Executive is
                        employed, immediately following such JHFS Corporate
                        Event, by any entity in which the stockholders of JHFS,
                        immediately prior to such JHFS Corporate Event hold,
                        directly or indirectly, a majority of the Voting Power;
                        or

            (vi) any other event occurs which the Board or the JHFS Board
      declares to be a Change of Control.

      (e) "JHFS" means John Hancock Financial Services, Inc.

      (f) "JHFS Board" means the Board of Directors of JHFS and, after a Change
in Control that constitutes a Company Corporate Event or a JHFS Corporate Event,
the Board Directors of the Parent.

      (g) "Parent" shall mean any corporation, partnership, limited liability
company, business trust or other entity which owns, directly or indirectly, more
than 50% of the Voting Power in the Company or JHFS.

      (h) "Person" shall have the meaning ascribed to such term in Section
3(a)(9) of the Exchange Act, as supplemented by Section 13(d)(3) of the Exchange
Act; provided, however, that Person shall not include (i) the Company, JHFS, or
any Affiliate or (ii) any employee benefit plan sponsored by the entities
described in clause (i) of this definition.

      (i) "Potential Change of Control" shall be deemed to have occurred if:

            (i) a Person commences a tender offer (with adequate financing) for
      securities representing at least 10% of the Voting Power of the JHFS's
      securities;

            (ii) the Company or JHFS enters into an agreement the consummation
      of which would constitute a Change of Control;

            (iii) proxies for the election of directors of JHFS are solicited by
      anyone other than JHFS; or

            (iv) any other event occurs which is deemed to be a Potential Change
      of Control by the JHFS Board.

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      (j) "Voting Power" shall mean such number of the Voting Securities as
shall enable the holders thereof to cast such percentage of all the votes which
could be cast in an annual election of directors.

      (k) "Voting Securities" shall mean all securities of a company entitling
the holders thereof to vote in an annual election of directors.

      3. Employment Period. Subject to Section 6 of this Agreement, the Company
(or if applicable, JHFS) agrees to continue the Executive in its employ, and the
Executive agrees to remain in the employ of the Company or, if applicable, JHFS
for the period (the "Employment Period") commencing on the Effective Date and
ending on the third anniversary of the Effective Date. Notwithstanding the
foregoing, if, prior to the Effective Date, the Executive is demoted to a lower
position than the position held on the date first set forth above, the Board (or
if applicable, the JHFS Board) may declare that this Agreement shall be without
force and effect by written notice delivered to the Executive (i) within 30 days
following such demotion and (ii) prior to the occurrence of a Potential Change
of Control or a Change of Control.

      4. Position and Duties. (a) No Reduction in Position. During the
Employment Period, the Executive's position (including titles), authority and
responsibilities with the Company, JHFS and each of the Affiliates shall be,
both individually and in the aggregate, at least commensurate with those held,
exercised and assigned immediately prior to the Effective Date. It is understood
that, for purposes of this Agreement, such position, authority and
responsibilities shall not be regarded as not commensurate merely by virtue of
the fact that a successor shall have acquired all or substantially all of the
business and/or assets of the Company as contemplated by Section 13(b) of this
Agreement. The Executive's services shall be performed at the location where the
Executive was employed immediately preceding the Effective Date.

      (b) Business Time. From and after the Effective Date, the Executive agrees
to devote substantially all of his/her attention during normal business hours to
the business and affairs of the Company, JHFS and the Affiliates and to use
his/her reasonable best efforts to perform the responsibilities assigned to him
hereunder, to the extent necessary to discharge such responsibilities, except
for (i) time spent in managing his/her personal, financial and legal affairs and
serving on corporate, civic or charitable boards or committees, in each case
only if and to the extent not substantially interfering with the performance of
such responsibilities, and (ii) periods of vacation and sick leave to which
he/she is entitled. It is expressly understood and agreed that the Executive's
continuing to serve on any boards and committees on which he/she is serving or
with which he/she is otherwise associated immediately preceding the Effective
Date shall not be deemed to interfere with the performance of the Executive's
services for the Company, JHFS or the Affiliates.

      5. Compensation. (a) Base Salary. During the Employment Period, the
Executive shall receive a base salary at a monthly rate at least equal to the
monthly salary paid to the Executive by the Company, JHFS and any Affiliate
immediately prior to the Effective Date. The base salary shall be reviewed at
least once each year after the Effective Date, and may be increased (but not
decreased) at any time and from time to time by action of the Board or JHFS
Board, as the case may be, or any committee thereof or any individual having
authority to take such action in accordance with the Company's (or if
applicable, JHFS's) regular practices. The Executive's base salary, as it may be
increased from time to time, shall hereafter be referred to as "Base Salary".
Neither the Base Salary nor any increase in Base Salary after the Effective Date
shall serve to limit or reduce any other obligation of the Company or JHFS
hereunder.

      (b) Annual Bonus. During the Employment Period, in addition to the Base
Salary, for each fiscal year of the Company ending during the Employment Period,
the Executive shall be afforded the opportunity to receive an annual bonus on
terms and conditions no less favorable to the Executive (taking into account
reasonable changes in the applicable corporate goals and objectives and taking
into account actual performance) than the annual bonus opportunity that had been
made available to the Executive for the fiscal year ended immediately prior to
the Effective Date (the "Annual Bonus Opportunity"). Any amount payable in
respect of the Annual Bonus Opportunity shall be paid as soon as practicable
following the year for which the amount (or prorated portion) is earned or
awarded, unless electively deferred by the Executive

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pursuant to any deferral programs or arrangements that the Company, JHFS or any
of its Affiliates may make available to the Executive.

      (c) Long-term Incentive Compensation Programs. During the Employment
Period, the Executive shall participate in all long-term incentive compensation
programs (including, without limitation, programs providing for the grant of
stock options and other equity-based awards) for key executives at a level that
is commensurate with the Executive's participation in such plans immediately
prior to the Effective Date, or, if more favorable to the Executive, at the
level made available to the Executive or other similarly situated officers at
any time thereafter.

      (d) Benefit Plans. During the Employment Period, the Company shall provide
to the Executive (and to the extent applicable, his/her dependents) pension,
retirement, deferred compensation, savings, medical, dental, health, disability,
life and accidental death coverages, both individual and group, at a level that
is commensurate with the coverage to which the Executive was entitled under
plans sponsored by the Company, JHFS or any affiliate immediately prior to the
Effective Date, or, if more favorable to the Executive, at the level made
available to the Executive or other similarly situated officers at any time
thereafter. The Executive shall be entitled to such benefits subject to the same
terms and conditions (including, without limitation, any requirement that the
Executive make contributions toward the cost of such coverage) that applied
immediately prior to the Effective Date, or, if more favorable to the Executive,
as are made applicable to the Executive or other similarly situated officers at
any time thereafter. To the extent such benefits cannot be provided under the
terms of a benefit plan, policy or program sponsored by the Company, JHFS or any
affiliate, as the case may be, the Company shall provide a comparable benefit
under another plan or from the Company's general assets.

      (e) Expenses. During the Employment Period, the Executive shall be
entitled to receive prompt reimbursement for all reasonable expenses incurred by
the Executive in accordance with the policies and procedures of the Company as
in effect immediately prior to the Effective Date. Notwithstanding the
foregoing, the Company may apply the policies and procedures in effect after the
Effective Date to the Executive, if such policies and procedures are not less
favorable to the Executive than those in effect immediately prior to the
Effective Date.

      (f) Vacation and Fringe Benefits. During the Employment Period, the
Executive shall be entitled to paid vacation and fringe benefits (including,
without limitation, any split-dollar life insurance arrangements) at a level
that is commensurate with the paid vacation and fringe benefits available to the
Executive immediately prior to the Effective Date, or, if more favorable to the
Executive, at the level made available from time to time to the Executive or
other similarly situated officers at any time thereafter.

      (g) Indemnification. During and after the Employment Period, the Company
and JHFS shall indemnify the Executive and hold the Executive harmless from and
against any claim, loss or cause of action arising from or out of the
Executive's performance as an officer, director or employee of JHFS, the Company
or any of their Affiliates or in any other capacity, including any fiduciary
capacity, in which the Executive serves at the request of the Company to the
maximum extent permitted by applicable law and the Certificate of Incorporation
and By-Laws of JHFS or the Company, as the case may be (the "Governing
Documents"), provided that in no event shall the protection afforded to the
Executive hereunder be less than that afforded under the Governing Documents as
in effect immediately prior to the Effective Date.

      (h) Office and Support Staff. The Executive shall be entitled to an office
with furnishings and other appointments, and to secretarial and other
assistance, at a level that is at least commensurate with the foregoing provided
to the Executive immediately prior to the Change of Control.

      6. Termination. (a) Death, Disability or Retirement. Subject to the
provisions of Section 1 hereof, this Agreement shall terminate automatically
upon the Executive's death, termination due to "Disability" (as defined below)
or voluntary retirement under any of the retirement plans of the Company or JHFS
(or, if applicable, an Affiliates) has in effect from time to time. For purposes
of this Agreement, Disability shall mean the Executive has met the conditions to
qualify for long-term disability benefits under

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the long term disability plan or policy the Company or JHFS (or, if applicable,
an Affiliate), has in effect immediately prior to the Effective Date.

      (b) Voluntary Termination. Notwithstanding anything in this Agreement to
the contrary, following a Change of Control the Executive may, upon not less
than 60 days' written notice to the Company (or, if applicable, JHFS),
voluntarily terminate employment for any reason (including early retirement
under the terms of any retirement plans maintained by the Company, JHFS or an
Affiliate, as in effect from time to time), provided that any termination by the
Executive pursuant to Section 6(d) on account of Good Reason (as defined
therein) shall not be treated as a voluntary termination under this Section
6(b).

      (c) Cause. The Company, JHFS or an Affiliate that employs the Executive
may terminate the Executive's employment for Cause. For purposes of this
Agreement, "Cause" means (i) the Executive's conviction or plea of nolo
contendere to a felony related to fraud or dishonesty; (ii) an act or acts of
dishonesty or gross misconduct on the Executive's part which result or are
intended to result in material damage to the Company's, JHFS's or an Affiliate's
business or reputation; or (iii) repeated material violations by the Executive
of his/her obligations under Section 4 of this Agreement, which violations are
demonstrably willful and deliberate on the Executive's part and which result in
material damage to the Company's, JHFS's or an Affiliate's business or
reputation. Cause shall not exist unless and until JHFS has delivered to
Executive a copy of a resolution duly adopted by three-quarters (3/4) of the
entire JHFS Board (excluding the Executive if the Executive is a JHFS Board
member) at a meeting of the JHFS Board called and held for such purpose (after
reasonable notice to the Executive and an opportunity for the Executive,
together with counsel, to be heard before the JHFS Board), finding that in the
good faith opinion of the JHFS Board an event set forth in subclauses (i), (ii),
or (iii) has occurred and specifying the particulars thereof in detail. The
Company, JHFS or an Affiliate must notify the Executive of any event that it
alleges constitutes Cause within ten (10) business days following the Company's,
JHFS's or an Affiliate's knowledge, as the case may be, of its existence, and
notify the Executive at least ten (10) business days prior to the board
proceedings described above, or such event shall not constitute Cause under this
Agreement.

      (d) Good Reason. Following the occurrence of a Change of Control, the
Executive may terminate his/her employment for Good Reason. For purposes of this
Agreement, "Good Reason" means the occurrence of any of the following, without
the express written consent of the Executive, after the occurrence of a Change
of Control:

            (i) the assignment to the Executive of any duties inconsistent in
      any material adverse respect with the Executive's position, authority or
      responsibilities, as contemplated by Section 4 of this Agreement, or any
      other material adverse change in position, titles, authority or
      responsibilities, including and without limiting the generality of the
      foregoing, the elimination or substantial reduction of the Executive's
      duties with the Company, JHFS or any Affiliate resulting in a significant
      reduction in his position, titles, authority or responsibilities as in
      effect prior to the Change of Control;

            (ii) any failure by the Company or JHFS to comply with any of the
      provisions of Section 5 of this Agreement, other than an insubstantial or
      inadvertent failure remedied by the Company or JHFS promptly after receipt
      of notice thereof given by the Executive;

            (iii) any requirement that the Executive (A) be based at any office
      or location more than 35 miles (or any such shorter distance as shall be
      set forth in the Company's (or if applicable, JHFS's) relocation policy as
      in effect on the Effective Date) from that location at which he/she
      performed his/her services specified under the provisions of Section 4
      immediately prior to the Change of Control, except for travel reasonably
      required in the performance of the Executive's responsibilities or (B)
      travel on business on behalf of the Company, JHFS or any Affiliate, as the
      case may be, to an extent substantially greater than the travel
      obligations of the Executive immediately prior to the Change in Control;

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            (iv) any failure by the Company or JHFS to obtain the assumption and
      agreement to perform this Agreement by a successor as contemplated by
      Section 13(b).

In no event shall the mere occurrence of a Change of Control, absent any further
impact on the Executive, be deemed to constitute Good Reason.

Notwithstanding anything herein to the contrary, termination of employment by
the Executive for any reason during the 30-day period commencing one hundred and
eighty (180) days after the date of a Change in Control shall be deemed to
constitute Good Reason.

      (e) Notice of Termination. Any termination by the Company, JHFS or an
Affiliate for Cause or by the Executive for Good Reason shall be communicated by
Notice of Termination to the other party hereto given in accordance with Section
14(e). For purposes of this Agreement, a "Notice of Termination" means a written
notice which (i) indicates the specific termination provision in this Agreement
relied upon, (ii) sets forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive's employment under
the provision so indicated, and (iii) if the termination date is other than the
date of receipt of such notice, specifies the termination date of this Agreement
(which date shall be not more than 15 days after the giving of such notice). In
the case of a termination for Good Reason, the Notice of Termination shall be
given within 180 days of the Executive's having actual knowledge of the events
giving rise to such termination which actual knowledge shall in no event be
deemed to have occurred any earlier than the Effective Date. The failure by the
Executive to set forth in the Notice of Termination any fact or circumstance
which contributes to a showing of Good Reason shall not waive any right of the
Executive hereunder or preclude the Executive from asserting such fact or
circumstance in enforcing his/her rights hereunder.

      (f) Date of Termination. For the purpose of this Agreement, the term "Date
of Termination" means (i) in the case of a termination for which a Notice of
Termination is required, the date of receipt of such Notice of Termination or,
if later, the date specified therein, as the case may be, and (ii) in all other
cases, the actual date on which the Executive's employment terminates during the
Employment Period.

      7. Obligations of the Company upon Termination. (a) Death or Disability.
If the Executive's employment is terminated during the Employment Period by
reason of the Executive's death or Disability, this Agreement shall terminate
without further obligations to the Executive or the Executive's legal
representatives under this Agreement other than those obligations accrued
hereunder at the Date of Termination, and the Company shall pay to the Executive
(or his/her beneficiary or estate) (i) the Executive's full Base Salary through
the Date of Termination (the "Earned Salary"), (ii) any vested amounts or
benefits owing to the Executive under the otherwise applicable employee benefit
plans and programs of the Company, JHFS and the Affiliates, including any
compensation previously deferred by the Executive (together with any accrued
earnings thereon) and not yet paid by the Company, JHFS or an Affiliate and any
accrued vacation pay not yet paid by the Company, JHFS or an Affiliate (the
"Accrued Obligations"), and (iii) any other benefits payable due to the
Executive's death or Disability under the plans, policies or programs of the
Company, JHFS and the Affiliates (the "Additional Benefits").

      The Earned Salary shall be paid in cash in a single lump sum as soon as
practicable, but in no event more than 10 days (or at such earlier date required
by law), following the Date of Termination. Accrued Obligations and Additional
Benefits shall be paid in accordance with the terms of the applicable plan,
program or arrangement.

      (b-1) Cause and Voluntary Termination. If, during the Employment Period,
the Executive's employment shall be terminated for Cause or voluntarily
terminated by the Executive (other than on account of Good Reason following a
Change of Control), the Company shall pay the Executive (i) the Earned Salary in
cash in a single lump sum as soon as practicable, but in no event more than 10
days, following the Date of Termination, and (ii) the Accrued Obligations in
accordance with the terms of the applicable plan, program or arrangement.

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      (b-2) Retirement Benefits Upon Termination. If the Executive's employment
is terminated for any reason other than for Cause or due to death,
notwithstanding anything else contained in this Agreement to the contrary, the
following provisions shall apply: Regardless of the Executive's age or completed
service with the Company on his date of termination, the Executive shall (1) for
purposes of retiree medical and retiree life insurance benefits be deemed to
have completed 15 years of service on such termination date and commence to
receive benefits from the Company or JHFS accordingly and (2) receive from the
Company or JHFS a benefit as though a special contribution to his cash balance
pension account had been made in an amount equal to (x) the contributions that
the Company made to such account in the most recent calendar year, multiplied by
(y) a number equal to 15 minus the number of years of service completed by the
Executive as of such termination date, and the Executive shall, at his option,
have the right to immediately commence receiving pension benefit payments or to
withdraw or transfer such amount. Further, the benefits described in this
Section 7(b-2) shall be made available to the Executive upon any termination of
employment, other than for Cause or due to death, regardless of whether
occurring during or after the Employment Period (i.e. the Executive shall be
entitled to receive these benefits due to termination, other than for Cause or
due to death, even if occurring more than three years after the Effective Date).

      (c) Termination by the Company other than for Cause. If, during the
Employment Period, the Company or JHFS, terminates the Executive's employment
other than for Cause, the Company shall provide the Executive with the following
benefits:

            (i) Severance and Other Termination Payments. The Company shall pay
      the Executive the following:

            (A)   the Executive's Earned Salary; and

            (B)   notwithstanding any plan provisions to the contrary, an amount
                  (the "Pro-Rated Annual Incentive") equal to the target annual
                  bonus applicable to the Executive for the fiscal year in which
                  the Date of Termination occurs, multiplied by a fraction, the
                  numerator of which is the number of completed months in such
                  fiscal year which have elapsed on or before (and including)
                  the Date of Termination and the denominator of which is 12;
                  and

            (C)   notwithstanding any plan provisions to the contrary, an
                  aggregate amount (the "Pro-Rated Long Term Incentives") equal
                  to the sum of the amounts awarded to the Executive in respect
                  of each performance cycle, whether or not vested, then in
                  progress (i.e., each performance cycle, which includes as part
                  of the performance period the fiscal year in which the Date of
                  Termination occurs), as accrued on the books of the Company as
                  of the end of the month preceding the Date of Termination; and

            (D)   the Accrued Obligations; and

            (E)   a cash amount (the "Severance Amount") equal to three times
                  the sum of

                  (1)   the Executive's annual Base Salary; and

                  (2)   an amount equal to the target annual bonus applicable to
                        the Executive for the fiscal year in which the Change of
                        Control occurs;

                  (3)   an amount equal to the long term incentive award granted
                        to the Executive with respect to the performance period
                        commencing in the calendar year 2000. For purposes of
                        this Section 7(c)(i)(E)(3), such award shall be measured
                        by the equity rights awarded to the Executive for such
                        performance period under the Long-Term Incentive Plan
                        for Senior Executives.

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      The Earned Salary, Pro-Rated Annual Incentive, Pro-Rated Long Term
      Incentives, Retention Bonus and Severance Amount shall be paid in cash in
      a single lump sum as soon as practicable, but in no event more than 10
      days (or at such earlier date required by law), following the Date of
      Termination. Accrued Obligations shall be paid in accordance with the
      terms of the applicable plan, program or arrangement.

            (ii) Continuation of Benefits. If, during the Employment Period, the
      Executive's employment is terminated other than for Cause, the Executive
      (and, to the extent applicable, his/her dependents) shall be entitled,
      after the Date of Termination until the earlier of (A) the third
      anniversary of the Date of Termination (the "End Date") and (B) the date
      the Executive becomes eligible for comparable benefits under a similar
      plan, policy or program of a subsequent employer, to continue
      participation in all of the individual and group health (including without
      limitation medical, dental and disability) and life employee benefits
      plans maintained by the Company, JHFS or an Affiliate and in which the
      Executive had been participating prior to the Date of Termination (the
      "Benefit Plans"). In addition, to the extent that, prior to the Date of
      Termination, the Company had been paying the premiums on any split-dollar
      life insurance policy with respect to the Executive, the Company shall, as
      to any such policy, continue the payment of such premiums until the later
      of the End Date or the date through which the Company otherwise would have
      paid premiums on such policy in the absence of a Change of Control. To the
      extent any such benefits cannot be provided under the terms of the
      applicable plan, policy or program, the Company shall provide a comparable
      benefit under another plan or from the Company's general assets. The
      Executive's participation in the Benefit Plans will be on the same terms
      and conditions (including, without limitation, any condition that the
      Executive make contributions toward the cost of such coverage on the same
      terms and conditions generally applicable to similarly situated employees)
      that would have applied had the Executive continued to be employed by the
      Company through the End Date.

            (iii) Retirement Benefits. The Executive shall be entitled to the
      retirement benefits described in Section 7(b-2).

            (iv) Payment of Mandatorily Deferred Incentive Compensation
      Payments. To the extent not earlier paid in accordance with the terms and
      conditions of the governing plan documents, all amounts, if any, that had
      been determined to be payable to the Executive under any long term
      incentive compensation program, but the payment of which was mandatorily
      deferred under the terms and conditions of such governing documents, shall
      be paid (plus all earnings credited with respect thereto) in a single lump
      sum payment, as soon as practicable after the next succeeding valuation
      date under the applicable plans, but in no event later than the first
      March 15 following the Executive's Date of Termination.

            (v) Outplacement Services. The Executive shall be provided at the
      Company's expense with outplacement services customary for executives at
      his/her level (including, without limitation, office space and telephone
      support services) provided by a qualified and experienced third party
      provider selected by the Company.

      (d) Termination by the Executive for Good Reason. If, during the
Employment Period, the Executive terminates his/her employment for Good Reason,
the Company shall pay to the Executive the same amounts as would be payable to
the Executive under Section 7(c) if such termination were a termination by the
Company or JHFS without Cause.

      (e) Discharge of the Company's and JHFS's Obligations. Except as expressly
provided in the last sentence of this Section 7(e), the amounts payable to the
Executive pursuant to this Section 7 following termination of his/her employment
shall be in full and complete satisfaction of the Executive's rights under this
Agreement and any other claims he/she may have in respect of his/her employment
by the Company, JHFS or the Affiliates. Such amounts shall constitute liquidated
damages with respect to any and all such rights and claims and, upon the
Executive's receipt of such amounts, the Company, JHFS and each of their
Affiliates shall be released and discharged from any and all liability to the
Executive in connection with this

                                       9
<PAGE>

Agreement or otherwise in connection with the Executive's employment with the
Company, JHFS and their Affiliates. Nothing in this Section 7(e) shall be
construed to release the Company or JHFS, as applicable, from its commitment to
indemnify the Executive and hold the Executive harmless from and against any
claim, loss or cause of action arising from or out of the Executive's
performance as an officer, director or employee of the Company, JHFS or any of
their Affiliates or in any other capacity, including any fiduciary capacity, in
which the Executive served at the request of the Company or JHFS to the maximum
extent permitted by applicable law and the Governing Documents.

      (f) Certain Further Payments by the Company.

            (i) In the event that any amount or benefit paid or distributed to
      the Executive pursuant to this Agreement and/or any amounts or benefits
      otherwise paid or distributed (whether or not paid or distributed pursuant
      to a plan or program maintained by the Company or JHFS) to the Executive
      by the Company, JHFS or any Affiliate, including without limitation, the
      present value of any amounts or benefits that otherwise become payable to
      the Executive by the Company, JHFS or any Affiliate or otherwise become
      nonforfeitable because of the lapse or termination of any restrictions
      thereon as a result of a Change of Control (collectively, the "Covered
      Payments"), are or become subject to the tax (the "Excise Tax") imposed
      under Section 4999 of the Internal Revenue Code of 1986, as amended (the
      "Code"), or any similar tax that may hereafter be imposed, the Company
      shall pay to the Executive at the time specified in Section 7(f)(v) below
      an additional amount ("Tax Reimbursement Payment") such that the net
      amount retained by the Executive with respect to such Covered Payments,
      after deduction of any Excise Tax on the Covered Payments and any Federal,
      state and local income or employment tax and Excise Tax on the Tax
      Reimbursement Payment provided for by this Section 7(f), but before
      deduction for any Federal, state or local income or employment tax
      withholding on such Covered Payments, shall be equal to the amount of the
      Covered Payments.

            (ii) For purposes of determining whether any of the Covered Payments
      will be subject to the Excise Tax and the amount of such Excise Tax,

            (A)   such Covered Payments will be treated as "parachute payments"
                  within the meaning of Section 280G of the Code, and all
                  "parachute payments" in excess of the "base amount" (as
                  defined under Section 280G(b)(3) of the Code) shall be treated
                  as subject to the Excise Tax, unless, and except to the extent
                  that, in the good faith judgment of the Company's independent
                  certified public accountants appointed prior to the Change of
                  Control Date or tax counsel selected by such accountants (the
                  "Accountants"), the Company has a reasonable basis to conclude
                  that such Covered Payments (in whole or in part) either do not
                  constitute "parachute payments" or represent reasonable
                  compensation for personal services actually rendered (within
                  the meaning of Section 280G(b)(4)(B) of the Code) in excess of
                  the "base amount," or such "parachute payments" are otherwise
                  not subject to such Excise Tax, and

            (B)   the value of any non- cash benefits or any deferred payment or
                  benefit shall be determined by the Accountants in accordance
                  with the principles of Section 280G of the Code.

            (iii) For purposes of determining the amount of the Tax
      Reimbursement Payment, the Executive shall be deemed to pay:

            (A)   Federal income taxes at the highest applicable marginal rate
                  of Federal income taxation for the calendar year in which the
                  Tax Reimbursement Payment is to be made, and

            (B)   any applicable state and local income taxes at the highest
                  applicable marginal rate of taxation for the calendar year in
                  which the Tax Reimbursement Payment is to

                                       10
<PAGE>

                  be made, net of the maximum reduction in Federal income taxes
                  which could be obtained from the deduction of such state or
                  local taxes if paid in such year.

            (iv) In the event that the Excise Tax is subsequently determined by
      the Accountants or pursuant to any proceeding or negotiations with the
      Internal Revenue Service to be less than the amount taken into account
      hereunder in calculating the Tax Reimbursement Payment made, the Executive
      shall repay to the Company, at the time that the amount of such reduction
      in the Excise Tax is finally determined, the portion of such prior Tax
      Reimbursement Payment that would not have been paid if such Excise Tax had
      been applied in initially calculating such Tax Reimbursement Payment, plus
      interest on the amount of such repayment at the rate provided in Section
      1274(b)(2)(B) of the Code. Notwithstanding the foregoing, in the event any
      portion of the Tax Reimbursement Payment to be refunded to the Company has
      been paid to any Federal, state or local tax authority, repayment thereof
      shall not be required until actual refund or credit of such portion has
      been made to the Executive, and interest payable to the Company shall not
      exceed interest received or credited to the Executive by such tax
      authority for the period it held such portion. The Executive and the
      Company shall mutually agree upon the course of action to be pursued (and
      the method of allocating the expenses thereof) if the Executive's good
      faith claim for refund or credit is denied.

            In the event that the Excise Tax is later determined by the
      Accountants or pursuant to any proceeding or negotiations with the
      Internal Revenue Service to exceed the amount taken into account hereunder
      at the time the Tax Reimbursement Payment is made (including, but not
      limited to, by reason of any payment the existence or amount of which
      cannot be determined at the time of the Tax Reimbursement Payment), the
      Company shall make an additional Tax Reimbursement Payment in respect of
      such excess (plus any interest or penalty payable with respect to such
      excess) at the time that the amount of such excess is finally determined.

            (v) Any Tax Reimbursement Payment (or portion thereof) payable in
      accordance with Section 7(f)(i) above shall be paid to the Executive as of
      the date of the payment (or acceleration of vesting or lapse of
      restrictions as a result of a Change of Control, as the case may be) of
      the Covered Payments; provided, however, that if the amount of such Tax
      Reimbursement Payment (or portion thereof) cannot be finally determined on
      or before the date on which payment is due, the Company shall pay to the
      Executive by such date an amount estimated in good faith by the
      Accountants to be the minimum amount of such Tax Reimbursement Payment and
      shall pay the remainder of such Tax Reimbursement Payment (together with
      interest at the rate provided in Section 1274(b)(2)(B) of the Code) as
      soon as the amount thereof can be determined, but in no event later than
      45 calendar days after payment of the related Covered Payment. In the
      event that the amount of the estimated Tax Reimbursement Payment exceeds
      the amount subsequently determined to have been due, such excess shall
      constitute a loan by the Company to the Executive, payable on the fifth
      business day after written demand by the Company for payment (together
      with interest at the rate provided in Section 1274(b)(2)(B) of the Code).

      8. Non-exclusivity of Rights. Except as expressly provided herein, nothing
in this Agreement shall prevent or limit the Executive's continuing or future
participation in any benefit, bonus, incentive or other plan or program provided
by the Company, JHFS or any of its Affiliates and for which the Executive may
qualify, nor shall anything herein limit or otherwise prejudice such rights as
the Executive may have under any other agreements with the Company, JHFS or any
of its Affiliates, including employment agreements or stock option agreements.
Amounts which are vested benefits or which the Executive is otherwise entitled
to receive under any plan or program of the Company, JHFS or any of its
Affiliates at or subsequent to the Date of Termination shall be payable in
accordance with such plan or program.

      9. No Offset. The Company's or JHFS's obligation to make the payments
provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, recoupment, defense or other right which
the Company, JHFS or any of their Affiliates may have against the Executive or
others whether by reason of the Executive's breach of this Agreement, subsequent
employment of the Executive, or otherwise.

                                       11
<PAGE>

      10. Legal Fees and Expenses. If the Executive asserts any claim in any
contest (whether initiated by the Executive or by the Company) as to the
validity, enforceability or interpretation of any provision of this Agreement,
the Company shall pay the Executive's legal expenses (or cause such expenses to
be paid) including, without limitation, his/her reasonable attorney's fees, on a
quarterly basis, upon presentation of proof of such expenses in a form
acceptable to the Company, provided that the Executive shall reimburse the
Company for such amounts, plus simple interest thereon at the 90-day United
States Treasury Bill rate as in effect from time to time, compounded annually,
if the arbitrator referred to in Section 14(b) or a court of competent
jurisdiction shall find that the Executive did not have a good faith and
reasonable basis to believe that he/she would prevail as to at least one
material issue presented to such arbitrator or court.

      11. Confidential Information; Company Property. By and in consideration of
the salary and benefits to be provided by the Company, JHFS or an Affiliate
hereunder, including the severance arrangements set forth herein, the Executive
agrees that:

      (a) Confidential Information. The Executive shall hold in a fiduciary
capacity for the benefit of the Company, JHFS and the Affiliates, all secret or
confidential information, knowledge or data relating to the Company, JHFS or the
Affiliates, and their respective businesses, (i) obtained by the Executive
during his/her employment by the Company, JHFS or the Affiliates and (ii) not
otherwise public knowledge (other than by reason of an unauthorized act by the
Executive). After termination of the Executive's employment, the Executive shall
not, without the prior written consent of the Company, unless compelled pursuant
to an order of a court or other body having jurisdiction over such matter,
communicate or divulge any such information, knowledge or data to anyone other
than the Company and those designated by it.

      (b) Nonsolicitation of Employees. The Executive agrees that for two years
after the Date of Termination, he/she will not attempt, directly or indirectly,
to induce any employee of the Company, JHFS or an Affiliate to be employed or
perform services elsewhere or otherwise to cease providing services to the
Company, JHFS or the Affiliates.

      (c) Return of Property. Except as expressly provided herein, promptly
following the Executive's termination of employment, the Executive shall return
to the Company, JHFS and the Affiliates all property of the Company, JHFS and
the Affiliates (as the case may be) and all copies thereof in the Executive's
possession or under his/her control.

      (d) Injunctive Relief and Other Remedies with Respect to Covenants. The
Executive acknowledges and agrees that the covenants and obligations of the
Executive with respect to confidentiality and the return of property relate to
special, unique and extraordinary matters and that a violation of any of the
terms of such covenants and obligations will cause the Company, JHFS and/or
their Affiliates irreparable injury for which adequate remedies are not
available at law. Therefore, the Executive agrees that the Company, JHFS and the
Affiliates shall be entitled to an injunction, restraining order or such other
equitable relief (without the requirement to post bond) restraining Executive
from committing any violation of the covenants and obligations contained in this
Section 11. These remedies are cumulative and are in addition to any other
rights and remedies the Company, JHFS and/or the Affiliates may have at law or
in equity. In no event shall an asserted violation of the provisions of this
Section 11 constitute a basis for deferring or withholding any amounts otherwise
payable to the Executive under this Agreement.

      12. Obligations of the Company and JHFS. The obligations of the Company
and JHFS are intended to be joint and several. If for any reason, either the
Company or JHFS does not, or is unable to, honor its obligations under this
Agreement, the other party shall satisfy all obligations not honored by the
other party.

      13. Successors. (a) This Agreement is personal to the Executive and,
without the prior written consent of the Company and JHFS, shall not be
assignable by the Executive otherwise than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable by
the Executive's legal representatives.

                                       12
<PAGE>

      (b) This Agreement shall inure to the benefit of and be binding upon JHFS,
the Company and each of its successors. The Company and JHFS, as applicable,
shall require any successor to all or substantially all of the business and/or
assets of the Company or JHFS, whether direct or indirect, by purchase, merger,
consolidation, acquisition of stock, or otherwise, by an agreement in form and
substance satisfactory to the Executive, expressly to assume and agree to
perform this Agreement in the same manner and to the same extent as the Company
and JHFS would be required to perform if no such succession had taken place.

      14. Miscellaneous. (a) Applicable Law. This Agreement shall be governed by
and construed in accordance with the laws of the States of Delaware, applied
without reference to principles of conflict of laws.

      (b) Arbitration. Except to the extent provided in Section 11(d), any
dispute or controversy arising under or in connection with this Agreement shall
be resolved by binding arbitration. The arbitration shall be held in the city of
Boston, Massachusetts and, except to the extent inconsistent with this
Agreement, shall be conducted in accordance with the Expedited Employment
Arbitration Rules of the American Arbitration Association then in effect at the
time of the arbitration (or such other rules as the parties may agree to in
writing), and otherwise in accordance with principles which would be applied by
a court of law or equity. The arbitrator shall be acceptable to all of the
Company, JHFS and the Executive. If the parties cannot agree on an acceptable
arbitrator, the dispute shall be heard by a panel of three arbitrators, one
appointed by the Company and JHFS, one appointed by the Executive, and the third
appointed by the other two arbitrators.

      (c) Amendments. This Agreement may not be amended or modified otherwise
than by a written agreement executed by the parties hereto or their respective
successors and legal representatives.

      (d) Entire Agreement. Subject to Section 8 herein, this Agreement
constitutes the entire agreement between the parties hereto with respect to the
matters referred to herein. No other agreement relating to the terms of the
Executive's employment by the Company, JHFS or any Affiliate, oral or otherwise,
shall be binding among the parties unless it is in writing and signed by the
party against whom enforcement is sought. There are no promises,
representations, inducements or statements among the parties other than those
that are expressly contained herein. The Executive acknowledges that he/she is
entering into this Agreement of his/her own free will and accord, and with no
duress, that he/she has read this Agreement and that he/she understands it and
its legal consequences.

      (e) Notices. All notices and other communications hereunder shall be in
writing and shall be given by hand-delivery to the other parties or by
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:

      If to the Executive:   at the home address of the Executive noted on the
                             records of the Company

      If to the Company:     200 Clarendon Street
                             Boston, Massachusetts
                             Attn.: Secretary

      If to JHFS:            200 Clarendon Street
                             Boston, Massachusetts
                             Attn.: Secretary

or to such other address as any party shall have furnished to the others in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.

                                       13
<PAGE>

      (f) Tax Withholding. The Company shall withhold from any amounts payable
under this Agreement such Federal, state or local taxes as shall be required to
be withheld pursuant to any applicable law or regulation.

      (g) Severability; Reformation. In the event that one or more of the
provisions of this Agreement shall become invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not be affected thereby. In the event that any
of the provisions of Section 11(a) are not enforceable in accordance with its
terms, the Executive and the Company and JHFS agree that such Section shall be
reformed to make such Section enforceable in a manner which provides the Company
and JHFS the maximum rights permitted at law.

      (h) Waiver. Waiver by any party hereto of any breach or default by any
party of any of the terms of this Agreement shall not operate as a waiver of any
other breach or default, whether similar to or different from the breach or
default waived. No waiver of any provision of this Agreement shall be implied
from any course of dealing among the parties hereto or from any failure by any
party hereto to assert its or his/her rights hereunder on any occasion or series
of occasions.

      (i) Survival. The provisions of Section 5(g), 7(b-2), 7(c), 7(d), 7(f), 12
and 13 shall survive the termination of the Employment Period hereunder and
shall be binding upon and enforceable against the Company and JHFS in accordance
with their terms. The dispute resolutions provisions contained in Section 14(b)
and the legal fees provision contained in Section 10 shall also survive the end
of the Employment Period and shall be applied as though the dispute arose within
the Employment Period.

      (j) Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original but all of which together shall constitute one
and the same instrument.

      (k) Captions. The captions of this Agreement are not part of the
provisions hereof and shall have no force or effect.

      IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand
and the Company and JHFS have caused this Agreement to be executed in their
respective names and on their behalf, all as of the day and year first above
written.

                                    JOHN HANCOCK LIFE
                                    INSURANCE COMPANY

                                    By: ______________________________________
                                        Name:  David F. D'Alessandro
                                        Title: Chairman, President and Chief
                                               Executive Officer

                                    JOHN HANCOCK FINANCIAL
                                    SERVICES, INC.

                                    By:_______________________________________
                                       Name:  David F. D'Alessandro
                                       Title: Chairman, President and Chief
                                              Executive Officer

                                    EXECUTIVE:

                                    __________________________________________

                                       14Exhibit 10.29

                       A. LORNE WEIL EMPLOYMENT AGREEMENT

                                Table of Contents

                                                                            Page

1.  Termination of Existing Employment Agreements..............................1
2.  Employment; Term...........................................................1
3.  Offices and Duties.........................................................2
4.  Compensation...............................................................2
5.  Benefits...................................................................4
6.  Termination................................................................5
7.  Compensation Following Termination Prior to the End of the Term............8
8.  Excise Tax Restoration Payment............................................13
9.  Offsets; Withholding......................................................14
10. Noncompetition; Nonsolicitation; Nondisclosure; etc.......................14
    10.1  Noncompetition; Nonsolicitation.....................................14
    10.2  Proprietary Information.............................................15
    10.3  Confidentiality and Surrender of Records............................16
    10.4  Nondisparagement....................................................16
    10.5  No Other Obligations................................................17
    10.6  Forfeiture of Outstanding Options...................................17
    10.7  Enforcement.........................................................18
    10.8  Cooperation with Regard to Litigation...............................18
    10.9  Survival............................................................18
    10.10 Company.............................................................18
11. Insurance for the Company's Benefit.......................................19
12. Indemnification...........................................................19
13. Notices...................................................................19
14. Assignability; Binding Effect.............................................20
15. Complete Understanding; Amendment; Waiver.................................21
16. Severability..............................................................21
17. Survivability.............................................................22
18. Governing Law; Arbitration; Expenses; Interest............................22
    18.1  Governing Law.......................................................22
    18.2  Arbitration.........................................................22
    18.3  Reimbursement of Expenses in Enforcing Rights.......................22
    18.4  Interest on Unpaid Amounts..........................................23
19. Reimbursement of Expenses of Executive in Negotiating Agreement...........23
20. Titles and Captions.......................................................23

                                       i
<PAGE>

                              EMPLOYMENT AGREEMENT

            This EMPLOYMENT AGREEMENT (this "Agreement") is made as of the 1st
day of November, 2000 (the "Effective Date"), by and between SCIENTIFIC GAMES
CORPORATION, a Delaware corporation formerly known as Autotote Corporation (the
"Company"), and A. Lorne Weil ("Executive").

                              W I T N E S S E T H :

            WHEREAS, Executive has been employed by the Company pursuant to an
Employment Agreement dated as of November 1, 1997, as amended by the letter
agreement dated September 10, 1998 and the Amendment to Employment Agreement
dated as of September 1, 2000 (the "Old Agreement"); and

            WHEREAS, the Company desires to continue to employ Executive with
the Company, and Executive wishes to continue to serve the Company, in the
capacities and on the terms and conditions set forth in this Agreement; and

            WHEREAS, the Company and Executive desire that this Agreement
replace and supersede the Old Agreement;

            NOW, THEREFORE, in consideration of the premises and the mutual
benefits to be derived herefrom and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:

      1. Termination of Existing Employment Agreements. As of the Effective
Date, all existing employment agreements between the parties, whether oral or
written, including the Old Agreement, are hereby terminated, except as provided
in Section 12.

      2. Employment; Term. The Company hereby agrees to employ Executive, and
Executive hereby accepts continued employment with the Company, in accordance
with and subject to the terms and conditions set forth herein. The term of
employment of Executive under this Agreement (the "Term") shall be the period
commencing on the Effective Date and ending on December 31, 2004, and any period
of extension thereof in accordance with this Section 2, subject to earlier
termination in accordance with Section 6. The Term shall be extended
automatically without further action by either party by one additional year
(added to the end of the Term) first on December 31, 2004 (extending the Term to
December 31, 2005) and then on each succeeding December 31 thereafter, unless
either party shall have given written notice to the other party prior to the
June 30 preceding the date upon which such extension would become effective
electing not to further extend the Term, in which case Executive's employment
shall terminate on the date upon which such extension would otherwise have
become effective, unless earlier terminated in accordance with Section 6;
provided, however, that any termination pursuant to this Section 2 shall be
subject to and without limitation of or prejudice to Executive's rights with
respect to (i) a termination for Good Reason pursuant to Section 6(e)(viii), or
(ii) a termination without Cause pursuant to Section 6(g), as applicable.
<PAGE>

      3. Offices and Duties.

            (a) During the Term, Executive shall serve as Chairman of the Board,
President and Chief Executive Officer of the Company and shall report solely to
the Board of Directors of the Company (the "Board"). Executive agrees to serve
during the Term as a member of the Board, and of any Board committee to which
the Board may elect him.

            (b) Executive shall perform such duties and responsibilities and
have such authority as are customary for the chairman of the board, president
and chief executive officer of a publicly held corporation of the size, type,
and nature of the Company as they may exist from time to time, but in no event
shall such duties, responsibilities and authority be reduced from those of
Executive at the Effective Date.

            (c) Executive shall devote his full business time and attention and
best efforts to his positions with the Company without commitment to other
business endeavors, except that so long as such activities do not preclude or
render unlawful Executive's employment by the Company or otherwise materially
inhibit the performance of his duties under this Agreement or materially impair
the business of the Company or its subsidiaries, Executive (i) may make personal
investments which are not in conflict with his duties to the Company and manage
personal and family financial and legal affairs, (ii) may continue to serve on
any board of directors on which he is known by the Board to be serving on the
Effective Date, as specified in Schedule A hereto, (iii) may undertake public
speaking engagements, and (iv) may serve as a director of (or hold a similar
position with) any other organization.

            (d) Executive shall be the highest-ranking executive of the Company.

      4. Compensation.

            (a) Base Salary. During the Term the Company shall pay Executive a
base salary (the "Base Salary") at the initial rate of $750,000 per annum,
payable biweekly (except to the extent deferred under a deferred compensation
plan) and subject to all withholdings that are legally required or are agreed to
by Executive. The Base Salary shall be increased annually on each January 1
during the Term by a percentage of the Base Salary then in effect equal to the
percentage increase, if any, during the preceding twelve months in the Consumer
Price Index for the Greater New York area. In no event shall the Base Salary be
reduced.

            (b) Incentive Compensation. Executive shall have the opportunity
annually to earn incentive compensation in amounts determined by the
Compensation Committee of the Board (the "Committee") in accordance with the
applicable plan(s) of the Company as in effect from time to time; provided,
however, that (i) Executive shall have the opportunity to earn annually up to
100% of the Base Salary as incentive compensation pursuant to, and subject to
the terms and conditions of, the Company's Management Incentive Compensation
Plan as in effect from time to time (provided, however, that if no Management
Incentive Compensation Plan is in effect at any relevant time, or if such plan,
as in effect at any relevant time, does not provide a reasonable opportunity for
Executive to earn annually up to 100% of the Base Salary as incentive
compensation, then the Company shall provide such

                                     - 2 -
<PAGE>

reasonable opportunity to Executive independently of such plan, and provided
further that Executive may in the discretion of the Committee or the Board
receive additional incentive compensation); and (ii) Executive's annual
opportunity for incentive compensation shall, for each year, be on terms and
conditions at least as favorable to Executive as the most favorable terms and
conditions for incentive compensation offered to any other employee of the
Company for such year. Any incentive compensation payable to Executive shall be
paid in accordance with the Company's usual practices with respect to payment of
incentive compensation to its other senior executives (except to the extent
deferred under a deferred compensation plan). To accommodate the change in the
Company's fiscal year end from October 31 to December 31, the first annual
period during the Term for purposes of Executive's incentive compensation shall
be the fourteen-month period from the Effective Date through December 31, 2001,
and Executive's annual opportunity for incentive compensation based on Base
Salary for such first annual period of the Term, ending December 31, 2001, shall
be determined with reference to the Base Salary (as determined in accordance
with the terms hereof) payable in respect of such fourteen-month period.
Notwithstanding anything to the contrary herein or in any plan, policy or
program of the Company, any other compensation or benefit to which Executive is
entitled that is based on a fiscal year of the Company shall be computed for
fiscal year 2001 so that the months of November and December 2000 are included
in such computation for the benefit of Executive, except to the extent (if any)
that (i) such months previously had been reflected in a computation of such
compensation or benefit, or (ii) inclusion of such months would otherwise result
in a duplication or overlap of such compensation or benefit or the computation
thereof; provided, however, that if, in the case of clause (i) or (ii) above,
the amount or value of such compensation or benefit in respect of such months
(or portion thereof) as so computed is less than what the amount or value of
such compensation or benefit would be for such months (or portion thereof) if
such months (or portion thereof) had been included in the computation of such
compensation or benefit for fiscal year 2001, then the amount or value of such
compensation or benefit for fiscal year 2001 shall be increased by the amount of
such difference (it being understood that, for the computation of any
compensation or benefit which is based on a comparison between amounts with
respect to a given reference period, including, without limitation, for purposes
of Section 5(h) of this Agreement, the amounts to be compared shall each be
computed for the same reference period).

            (c) Executive Compensation Plans. Executive shall be entitled during
the Term to participate, without discrimination or duplication, in the Company's
supplemental executive retirement plan and all other executive compensation
plans and programs which are made generally available by the Company to its
other senior executives (including, without limitation, any stock option plans,
performance share plans, management incentive plans, deferred compensation
plans, and supplemental retirement plans) in accordance with the terms of such
plans and programs and subject to the Company's right to at any time amend or
terminate any such plan or program; provided, however, that Executive shall be
eligible to participate in such executive compensation plans and programs on
terms and conditions at least as favorable to Executive as the most favorable
terms and conditions offered to any other employee of the Company. In the event
of a Change in Control, all outstanding stock options then held by Executive
shall become fully vested and non-forfeitable. For purposes of this Agreement, a
"Change in Control" shall be deemed to have occurred if: the stockholders of the
Company approve a merger, consolidation, recapitalization, or reorganization of
the Company, or a reverse stock split of any class of voting securities of the
Company, or the consummation of any such

                                     - 3 -
<PAGE>

transaction if stockholder approval is not obtained (in each case excluding any
transaction with Olivetti, S.p.A., Cirmatica Gaming, S.A., Lottomatica S.p.A.,
or their respective affiliates), other than any such transaction which would
result in at least 60% of the total voting power represented by the voting
securities of the Company or the surviving entity outstanding immediately after
such transaction being beneficially owned by persons who together beneficially
owned at least 80% of the combined voting power of the voting securities of the
Company outstanding immediately prior to such transaction; provided that, for
purposes of this paragraph (c), such continuity of ownership (and preservation
of relative voting power) shall be deemed to be satisfied if the failure to meet
such 60% threshold is due solely to the acquisition of voting securities by an
employee benefit plan of the Company or such surviving entity or of any
subsidiary of the Company or such surviving entity.

      5. Benefits.

            (a) The Company shall reimburse Executive for all reasonable and
necessary travel, business entertainment and other business expenses incurred by
Executive in connection with the performance of his duties under this Agreement,
on a timely basis upon submission by Executive of vouchers therefor in
accordance with the Company's standard procedures.

            (b) Executive shall be entitled to participate, without
discrimination or duplication, in any and all medical insurance, group health,
disability, life, accidental death, dismemberment insurance, pension,
retirement, profit sharing, stock ownership and other insurance, benefit, fringe
benefits and perquisite plans and programs which are made generally available by
the Company to its other senior executives; provided, however, that Executive
shall be eligible to participate in such insurance, benefit, fringe benefit and
perquisite plans and programs on terms and conditions at least as favorable to
Executive as the most favorable terms and conditions offered to any other
employee of the Company. The Company, in its sole discretion, may at any time
amend or terminate any such plans or programs; provided, however, that:

                  (i) At all times during the Term, such plans and programs in
effect, in the aggregate, shall provide Executive with benefits and compensation
substantially no less favorable than is provided by the Company to Executive
under such plans and programs as of the Effective Date;

                  (ii) The Company shall provide Executive with long-term
disability insurance and benefits substantially no less favorable (including any
required contributions by Executive) than such insurance and benefits in effect
on the Effective Date; and

                  (iii) The Company shall provide Executive with Company-paid
group and individual term life insurance providing a death benefit no less than
that provided under Company-paid insurance in effect on the Effective Date.

            (c) If the Company adopts an equity investment program permitting
executives to elect to forego salary, annual incentive, other bonuses, annual
option opportunities under long-term incentive plans, or other specified
compensation or benefits in exchange for a

                                     - 4 -
<PAGE>

grant of stock options, restricted stock or other equity or non-equity awards or
benefits, Executive will be eligible to participate in such program on terms no
less favorable than the terms of participation of any other employee of the
Company.

            (d) Executive shall be entitled to participate in the Company's
deferred compensation plan in accordance with the terms of such plan and subject
to the Company's right to at any time amend or terminate any such plan.

            (e) Executive shall be entitled to paid vacation, holidays, and any
other time off in accordance with the Company's policies in effect from time to
time.

            (f) The Company will use its best efforts to file with the
Securities and Exchange Commission and thereafter maintain the effectiveness of
one or more registration statements registering under the Securities Act of
1933, as amended, the offer and sale of shares by the Company to Executive
pursuant to stock options or other equity-based awards granted to Executive
under Company plans.

            (g) Executive shall be deemed to have commenced employment with the
Company on August 1, 1990, for purposes of calculating Executive's period of
service under this Agreement except to the extent, if any, that any provision of
this Agreement specifically credits Executive with a longer period of service
for purposes of such provision.

            (h) For purposes of computing the "Retirement Benefit" or equivalent
payment or benefit due to Executive under any SERP (as defined in Section 7(a)
below) in which Executive participates during the Term, or any payment or
benefit under Section 7 of this Agreement in lieu of any SERP benefit or
payment, the "Final Average Compensation" or equivalent reference compensation
amount, in the case of Executive, shall, notwithstanding the terms of such SERP,
be the higher of (x) such amount as otherwise determined pursuant to the terms
of the SERP or (y) an amount equal to the sum of (i) Executive's then-current
Base Salary immediately prior to termination plus (ii) such then-current Base
Salary multiplied by (A) the sum of the Incentive Compensation Percentages for
each of the Reference Years divided by (B) 3; where (X) "Incentive Compensation
Percentage" for a Reference Year means the percentage expressed by dividing the
aggregate incentive compensation and bonuses paid to Executive in such Reference
Year by Executive's Base Salary in such Reference Year, and (Y) "Reference Year"
means each of the three consecutive calendar years with the highest Incentive
Compensation Percentages during the period of ten calendar years immediately
preceding termination.

      6. Termination. Executive's employment hereunder may be terminated prior
to the end of the Term under the following circumstances:

            (a) Death; Total Disability. Executive's employment hereunder shall
terminate upon Executive's death, and the Company may terminate Executive's
employment hereunder in the event of Executive's "Total Disability." For
purposes of this Agreement, "Total Disability" shall mean Executive's failure to
perform the duties and responsibilities contemplated under this Agreement for a
period of more than 180 days during any consecutive 12-month period, due to
physical or mental incapacity or impairment as determined by a

                                     - 5 -
<PAGE>

physician or physicians selected by the Company and reasonably acceptable to
Executive unless, within 30 days after Executive has received written notice
from the Company of a proposed termination due to such failure (as determined in
accordance with the foregoing provisions of this sentence) which notice shall
include a copy of the findings of such physician or physicians and shall refer
to this Section 6(a), Executive shall have returned to the full performance of
his duties hereunder and shall have presented to the Company a written
certificate of Executive's good health by a physician selected by Executive and
reasonably acceptable to the Company.

            (b) Retirement. Executive may terminate his employment hereunder
upon retirement at or after age 65 or at or after age 55 following at least 10
years of full-time employment with the Company ("Normal Retirement") or prior to
such age upon approval by the Committee ("Approved Early Retirement"), in each
case upon forty-five (45) days' prior written notice to the Company referring to
this Section 6(b).

            (c) Termination by the Company for Cause. The Company may terminate
Executive's employment hereunder for Cause at any time upon written notice to
Executive referring to this Section 6(c). For purposes of this Agreement, the
term "Cause" shall mean Executive's gross misconduct (as defined herein) or
willful and material breach of Section 10.1(a) (other than the first sentence
thereof), 10.1(b), 10.2 (other than the first and penultimate sentences
thereof), 10.3, 10.4, or 10.8. For purposes of this definition, "gross
misconduct" shall mean (i) Executive's conviction in a court of law of a felony
under applicable federal or state law that was committed while Executive was
employed by the Company, or (ii) Executive's willful and continued failure
substantially to perform his material duties under this Agreement or any act or
omission on the part of Executive not requested or approved by the Board
constituting willful malfeasance or gross negligence in the performance of
Executive's material duties under this Agreement. For purposes of this
Agreement, an act or failure to act on Executive's part shall be considered
"willful" if it was done or omitted to be done by him not in good faith and
shall not include any act or failure to act resulting from any physical or
mental incapacity or impairment of Executive. Executive may not be terminated
for Cause unless and until there shall have been delivered to him, within ninety
(90) days after the Board (A) had actual knowledge of conduct or an event
allegedly constituting Cause and (B) had reason to believe that such conduct or
event could be grounds for termination for Cause, a copy of a resolution duly
adopted by the Board by a vote of Directors constituting a majority of the Board
(excluding Executive) at a meeting of the Board which a quorum is present and
which is called and held for such purpose (after giving Executive reasonable
notice of the specific grounds for such termination and, except if a felony
conviction is the grounds for termination, 30 days to correct such grounds, and
affording Executive and his counsel the opportunity to be heard before the
Board) finding that, in the good faith opinion of the Board, Executive was
guilty of conduct constituting Cause (the "Cause Resolution").

      If, within 30 days of Executive's receipt of notice of his termination for
Cause, Executive in good faith files a claim in arbitration disputing the
termination for Cause, Executive shall, during the pendency of the arbitration,
be considered a suspended employee of the Company and be entitled to receive
compensation and benefits under this Agreement as if he had not been terminated.
If the arbitration panel finds that the Company had Cause to terminate
Executive's employment, Executive shall, within 5 days of the arbitration award,
repay any amounts provided to him by the Company in respect of periods
commencing after his

                                     - 6 -
<PAGE>

termination, including but not limited to salary continuation and the value of
all benefits provided to Executive in respect of periods commencing after his
termination, in excess of any amounts to which he was entitled under this
Agreement upon a termination for Cause. If the arbitration panel finds that the
Company did not have Cause to terminate Executive's employment: (x) Executive's
employment shall be deemed to have been terminated without Cause as of the date
which is 90 days after the date of notice of his termination for Cause; and (y)
any amounts paid to Executive by the Company in respect of periods commencing
after 90 days following the date of the notice of his termination for Cause,
including but not limited to salary continuation and the value of all benefits
provided to Executive, shall be credited against amounts owed to Executive under
Section 7(c) of this Agreement.

            (d) Termination by the Company Without Cause. The Company may
terminate Executive's employment hereunder at any time, without Cause, for any
reason or no reason.

            (e) Termination by Executive for Good Reason. Executive may
terminate his employment hereunder for Good Reason. For purposes of this
Agreement, "Good Reason" shall mean: without Executive's prior written consent,
(i) a material change, adverse to Executive, in Executive's positions, titles or
offices as set forth in Section 3, or status rank, nature of responsibilities,
or authority within the Company, or removal of Executive from, or failure to
nominate, reappoint or reelect Executive as the Chairman of the Board, or as a
member of any Board committee on which he has served during the Term (except if
required by a change in law, accounting rule, or the rules of any national
securities exchange or automated quotation system on which the Company's
securities may be listed or quoted), including a failure of the Board or
stockholders to take such actions (notwithstanding their legal right to do so),
except, in such case, in connection with the termination of Executive's
employment for Cause, Total Disability, Normal Retirement or Approved Early
Retirement, or death, (ii) an assignment of any significant duties to Executive
which are inconsistent with his positions or offices held under Section 3, (iii)
a decrease in Base Salary or other compensation or in any compensation
opportunities or a material decrease in the aggregate benefits provided under
this Agreement, (iv) any other failure by the Company to perform any material
obligation under, or breach by the Company of any material provision of, this
Agreement, (v) a relocation of the Corporate Offices of the Company more than 35
miles from the latest location of such offices prior to such relocation, (vi)
any failure to secure the agreement of any successor corporation or other entity
to the Company to fully assume the Company's obligations under this Agreement in
a form reasonably acceptable to Executive, (vii) any attempt by the Company to
terminate Executive for Cause which does not result in a valid termination for
Cause, except where (x) valid grounds for Cause exist but are corrected as
permitted under Section 6(c) or (y) the Company, prior to 35 days after
Executive's receipt of a copy of the Cause Resolution, revokes the Cause
Resolution, takes any and all other steps reasonably necessary to retract its
allegations of Cause and fully restore Executive to active employment in
accordance with the terms of this Agreement, effective immediately prior to the
adoption of the Cause Resolution, and pays (or reimburses Executive for) any
costs and expenses reasonably incurred by Executive in connection with such
attempted termination, and (viii) the failure of the parties to agree in writing
at the end of the Term (or any extension thereof) to the terms of Executive's
continued employment where only Executive, and not the Company, has given notice
electing not to further extend the Term pursuant to the last sentence of Section
2; provided, however, that in the case of termination

                                     - 7 -
<PAGE>

pursuant to this clause (viii), the payment provided for in Section 7(c)(i)
shall be in a total amount equal to two times, rather than three times, the sum
of items (x) and (y) specified therein, but Section 7(c) shall apply in all
other respects to termination pursuant to this clause (viii). Executive shall
not be considered to have terminated for Good Reason unless Executive shall have
provided the Company with written notice of the specific reasons for such
termination within ninety (90) days after he has actual knowledge of the event
that is the basis for such termination and (except in the case of a termination
pursuant to clause (vii) or (viii) of the preceding sentence) affords the
Company at least thirty (30) days to cure the alleged conduct.

            (f) Termination by Executive for Other than Good Reason. Executive
may terminate his employment hereunder for any reason or no reason upon thirty
(30) days' prior written notice to the Company referring to this Section 6(f);
provided, however, that a termination of Executive's employment by reason of
death, Total Disability, Normal or Early Retirement, or Good Reason shall not
constitute a termination by Executive for other than Good Reason pursuant to
this Section 6(f).

            (g) Termination Upon the Company's Failure to Extend the Term. An
election by the Company not to extend the Term pursuant to Section 2 hereof
shall be deemed for all purposes of this Agreement (including, without
limitation, for purposes of Sections 7(c) and 10.1(a) hereof) to be a
termination of Executive's employment hereunder by the Company without Cause as
of the date of expiration of the Term.

      7. Compensation Following Termination Prior to the End of the Term. In the
event that Executive's employment hereunder is terminated prior to the end of
the Term, Executive shall be entitled only to the following compensation and
benefits:

            (a) Termination by Reason of Death, Normal Retirement, or Approved
Early Retirement. In the event that Executive's employment is terminated prior
to the expiration of the Term by reason of Executive's death, pursuant to
Section 6(a), or by reason of his Normal Retirement or Approved Early Retirement
pursuant to Section 6(b), the Company shall pay the following amounts, and make
the following other benefits available, to Executive (or Executive's spouse or
estate, as the case may be):

                  (i) Any accrued but unpaid Base Salary (as determined pursuant
to Section 4(a)) for services rendered to the date of termination;

                  (ii) All vested, nonforfeitable amounts owing or accrued at
the date of termination under any compensation and benefit plans, programs, and
arrangements set forth or referred to in Sections 4(b), 4(c), and 5 (including
any earned and vested annual incentive compensation and long term incentive
award but excluding any incentive compensation under Section 4(b) for the year
of termination) in which Executive theretofore participated, to be paid in
accordance with the terms and conditions of such plans, programs, and
arrangements (and agreements and documents thereunder);

                  (iii) In lieu of any incentive compensation under Section 4(b)
for the year of termination, an amount equal to the amount of annual incentive
compensation payable to Executive assuming achievement of the maximum
performance targets for such year,

                                     - 8 -
<PAGE>

multiplied by a fraction the numerator of which is the number of days Executive
was employed in the year of termination and the denominator of which is the
total number of days in the year of termination;

                  (iv) Stock options held by Executive at termination, if not
then vested and exercisable, will become fully vested and exercisable at the
date of such termination, and any such options which were granted on or after
November 1, 1997 (that is, the Effective Date of the Old Agreement) shall remain
exercisable until the earlier of three years after the date of such termination
or the scheduled expiration date, and, in other respects, all such options shall
be governed by the plans and programs and the agreements and other documents
pursuant to which such options were granted;

                  (v) All deferred stock awards, and all deferral arrangements
under any deferred compensation plan, will be settled in accordance with the
plans and programs under which the awards were granted or governing the deferral
including, if so permitted by the plans or programs, Executive's duly executed
deferral election forms or the terms of any mandatory deferral;

                  (vi) Reasonable business expenses and disbursements incurred
by Executive prior to such termination will be reimbursed in accordance with
Section 5(a);

                  (vii) If Executive's employment terminates due to his Normal
Retirement or Approved Early Retirement, Executive may elect continued
participation after termination in the Company's health and medical coverage for
himself and his spouse and dependent children after such coverage would
otherwise end until such time as Executive becomes eligible for Medicare;
provided, however, that in the event of such election, Executive shall pay the
Company each year an amount equal to the then-current annual COBRA premium being
paid (or payable) by any other former employee of the Company;

                  (viii) Executive shall be entitled to designate (and change,
to the extent permitted under applicable law) a beneficiary or beneficiaries to
receive any compensation or benefits payable hereunder following Executive's
death;

                  (ix) In lieu of any payments and benefits under any
supplemental executive retirement plan or substantially similar plan (a "SERP")
in which Executive participated during the Term, Executive shall be entitled to
receive the greater of: (y) all payments and benefits to which Executive
otherwise would have been entitled under the SERP (computed in accordance with
Section 5(h) hereof); and (z) all payments and benefits to which Executive
otherwise would have been entitled under the SERP (computed in accordance with
Section 5(h) hereof) if Executive had 15 years of service with the Company. Such
payments and benefits shall be payable in a lump sum or in equal installments,
as determined by Executive in his discretion, in accordance with the terms and
conditions of the SERP; provided, however, that Executive shall not be entitled
to receive payments in installments unless at least 12 months prior to the date
of the termination of his employment, he elected to receive payments in
installment form under the SERP. If Executive receives such payment(s) under
this Section 7(a)(ix), Executive shall forfeit all rights under the SERP, and
the SERP shall have no force and effect with respect to Executive;

                                     - 9 -
<PAGE>

Provided, however, that Executive will be entitled to the benefit of any terms
of plans or agreements applicable to Executive which are more favorable than
those specified in this Section 7(a).

Amounts payable under (i), (ii), (iii), and (vi) above will be paid as promptly
as practicable after termination of Executive's employment; provided, however,
that, to the extent that the Company would not be entitled to deduct any such
payments (other than those under (i) above) under Internal Revenue Code Section
162(m), such payments shall be made at the earliest time that the payments would
be deductible by the Company without limitation under Section 162 (m) (unless
this provision is waived by the Company).

            (b) Termination by the Company for Cause; Termination by Executive
for Other than Good Reason. In the event that Executive's employment is
terminated by the Company for Cause pursuant to Section 6(c) or by Executive for
other than Good Reason pursuant to Section 6(f), the Company shall pay the
following amounts, and make the following other benefits available, to
Executive:

                  (i) Any accrued but unpaid Base Salary (as determined pursuant
to Section 4(a)) for services rendered to the date of termination;

                  (ii) All vested nonforfeitable amounts owing or accrued at the
date of termination under any compensation and benefit plans, programs, and
arrangements set forth or referred to in Sections 4(b), 4(c), and 5 hereof
(including any earned and vested annual incentive compensation) in which
Executive theretofore participated will be paid under the terms and conditions
of such plans, programs, and arrangements (and agreements and documents
thereunder);

                  (iii) Except as provided in Section 10.6, all stock options
and deferred stock awards will be governed by the terms of the plans and
programs under which the options or awards were granted;

                  (iv) Non-forfeitable amounts credited to any deferral account
of Executive under deferral arrangements referred to in Section 5(d) hereof at
the date of termination will be settled in accordance with the plans and
programs under which the awards were granted or governing the deferral
including, if so permitted by the plans or programs, Executive's duly executed
deferral election forms or the terms of any mandatory deferral; and

                  (v) Reasonable business expenses and disbursements incurred by
Executive prior to such termination will be reimbursed, in accordance with
Section 5(a).

Amounts payable under (i), (ii), and (v) above will be paid as promptly as
practicable after termination of Executive's employment; provided, however,
that, to the extent that the Company would not be entitled to deduct any such
payments under Internal Revenue Code Section 162(m), such payments shall be made
at the earliest time that the payments would be deductible by the Company
without limitation under Section 162(m) (unless this provision is waived by the
Company).

                                     - 10 -
<PAGE>

            (c) Termination by Reason of Total Disability; Termination by the
Company Without Cause; Termination by Executive For Good Reason. In the event
that Executive's employment is terminated by reason of Total Disability pursuant
to Section 6(a), or by the Company without Cause pursuant to Section 6(d) or
6(g), or by Executive for Good Reason pursuant to Section 6(e), the Company
shall pay the following amounts, and make the following other benefits
available, to Executive:

                  (i) A lump sum cash payment in an amount equal (except as
provided in clause (viii) of Section 6(e)) to three times the sum of (x)
Executive's then-current Base Salary at the rate payable in accordance with
Section 4(a) hereof, at the date of termination plus (y) the Severance Annual
Incentive Amount (as defined below), will be paid to Executive; provided,
however, that Executive may elect to receive the amount payable under this
Section 7(c)(i) in equal monthly installments over the 36 months following
termination, without interest, in lieu of receiving a lump sum cash payment. For
purposes of this Section 7(c)(i) and Section 7(c)(iv), the "Severance Annual
Incentive Amount" shall be the greater of (1) the average annual incentive
compensation paid to Executive for the three years immediately preceding the
year of termination or (2) the annual incentive compensation payable to
Executive upon achievement of the maximum performance targets for the year of
termination;

                  (ii) The unpaid portion of Base Salary at the rate payable, in
accordance with Section 4(a) hereof, at the date of termination, pro rated
through such date of termination, will be paid;

                  (iii) All vested, nonforfeitable amounts owing or accrued at
the date of termination under any compensation and benefit plans, programs, and
arrangements set forth or referred to in Sections 4(b) and 5(a) and 5(c) hereof
(including any earned and vested annual incentive compensation) in which
Executive theretofore participated will be paid under the terms and conditions
of such plans, programs, and arrangements (and agreements and documents
thereunder);

                  (iv) In lieu of any annual incentive compensation under
Section 4(b) for the year in which Executive's employment terminated (unless
otherwise payable under (iii) above), Executive will be paid an amount equal to
(X) the Severance Annual Incentive Amount as defined in Section 7(c)(i),
multiplied by (Y) a fraction the numerator of which is the number of days
Executive was employed in the year of termination and the denominator of which
is the total number of days in the year of termination;

                  (v) Stock options held by Executive at termination, if not
then vested and exercisable, will become fully vested and exercisable at the
date of such termination, and any such options which were granted on or after
November 1, 1997 or, if previously granted, were not "in the money" as of
November 1, 1997 shall remain exercisable until the scheduled expiration date,
and, in other respects, all such options shall be governed by the plans and
programs and the agreements and other documents pursuant to which such options
were granted;

                  (vi) Deferred stock held by Executive at termination will
become fully vested and non-forfeitable, and shall be settled upon such
termination, without regard to any stated period of deferral otherwise remaining
in respect of such amounts;

                                     - 11 -
<PAGE>

                  (vii) Executive shall be entitled to receive an amount equal
to the amount accrued under any deferred compensation plan or agreement in
effect at the date of termination in which Executive is a participant or party,
less required withholding taxes under Section 9, as promptly as practicable
following such date of termination; the amount paid under this Section 7(c)(vii)
shall be equal to Executive's account balance on the date of the termination of
Executive's employment if the deferred compensation amount is in the form of an
account balance or, if the deferred compensation amount is not in the form of an
account balance, the present value of the deferred compensation on the date of
the termination of Executive's employment, calculated using a discount rate (the
"Discount Rate") equal to the yield, at the time of determination, for U.S.
Treasury securities having a maturity of thirty years; if Executive elects to
receive payment under this Section 7(c)(vii), Executive shall forfeit all rights
under any such deferred compensation plan or agreement, and such deferred
compensation plan or agreement shall have no force and effect with respect to
Executive;

                  (viii) Reasonable business expenses and disbursements incurred
by Executive prior to such termination will be reimbursed, in accordance with
Section 5(a);

                  (ix) For (A) a period of 3 years after such termination other
than due to Total Disability or (B) the period from termination due to Total
Disability until Executive attains age 65, Executive shall continue to
participate in all employee and executive benefit plans, programs, and
arrangements under Section 5 providing health, medical, disability and life
insurance benefits in which Executive was participating immediately prior to
termination, the terms of which allow Executive's continued participation, as if
Executive had continued in employment with the Company during such period or, if
such plans, programs, or arrangements do not allow Executive's continued
participation, Executive shall receive a cash payment equivalent on an after-tax
basis to the value of the additional benefits Executive would have received
under such plans, programs, and arrangements in which Executive was
participating immediately prior to termination, as if Executive had received
credit under such plans, programs, and arrangements for service and age with the
Company during such period following Executive's termination as provided in
clause (A) or (B) above (as applicable), with such benefits payable by the
Company at the same times and in the same manner as such benefits would have
been received by Executive under such plans (it being understood that the value
of any insurance-provided benefits will be based on the premium cost to
Executive, which shall not exceed the highest risk premium charged by a carrier
having an investment grade or better credit rating);

                  (x) In lieu of any payments and benefits under any SERP in
which Executive participated during the Term, Executive shall be entitled to
receive the greater of: (y) all payments and benefits to which Executive
otherwise would have been entitled under the SERP (computed in accordance with
Section 5(h) hereof); and (z) all payments and benefits to which Executive
otherwise would have been entitled under the SERP if Executive had 15 years of
service with the Company (computed in accordance with Section 5(h) hereof). Such
payments and benefits shall be payable in a lump sum or in equal installments,
as determined by Executive in his discretion, in accordance with the terms and
conditions of the SERP; provided, however, that Executive shall not be entitled
to receive payments in installments unless at least 12 months prior to the date
of the termination of his employment, he elected to receive payments in
installment form under the SERP; if Executive receives such payment(s) under
this Section

                                     - 12 -
<PAGE>

7(c)(x), Executive shall forfeit all rights under the SERP, and the SERP shall
have no force and effect with respect to Executive;

Provided, however, that if the Company terminates Executive's employment without
Cause and does not provide Executive with at least 90 days' prior written notice
of such termination, the date of Executive's termination for all purposes of
this Agreement except Section 7(c)(viii) shall be the 90th day after Executive
received written notice from the Company of the termination; and

Provided further that Executive will be entitled to the benefit of any terms of
plans or agreements applicable to Executive which are more favorable than those
specified in this Section 7(c). Except as otherwise expressly provided above,
amounts payable under this Section 7(c), will be paid as promptly as practicable
after termination of Executive's employment, and in no event more than 30 days
after such termination.

Notwithstanding the foregoing, if a reduction in Base Salary or other level of
compensation or benefit was a basis for Executive's termination for Good Reason,
the Base Salary or other level of compensation in effect before such reduction
shall be used to calculate payments or benefits under this Section 7(c).

            (d) No Obligation to Mitigate. Executive shall not be required to
seek other employment or otherwise to mitigate Executive's damages upon any
termination of employment; provided, however, that, to the extent Executive
receives from a subsequent employer health or other insurance benefits
substantially similar to the benefits referred to in Section 5, any such
benefits to be provided by the Company to Executive following the Term shall be
correspondingly reduced.

            (e) No Other Benefits or Compensation. Except as may be provided
under this Agreement, under any other written agreement between Executive and
the Company, or under the terms of any plan or policy applicable to Executive,
Executive shall have no right to receive any other compensation from the
Company, or to participate in any other plan, arrangement or benefit provided by
the Company, with respect to any future period after such termination or
resignation.

            (f) Release of Employment Claims. Executive agrees, as a condition
to receipt of any termination payments and benefits provided for in Section 7
(other than compensation and benefits earned through the date of termination),
that he will execute a general release agreement, in a form reasonably
satisfactory to the Company, releasing any and all claims arising out of
Executive's employment (other than enforcement of this Agreement)

      8. Excise Tax Restoration Payment. Notwithstanding anything to the
contrary in this Agreement, in the event that any payment or distribution of any
type to or for the benefit of Executive made by the Company, by any of its
affiliates, by any person who acquires ownership or effective control or
ownership of a substantial portion of the Company's assets (within the meaning
of section 280G of the Internal Revenue Code of 1986, as amended, and the
regulations thereunder (the "Code")) or by any affiliate of such person, whether
paid or payable or distributed or distributable pursuant to the terms of an
employment agreement or otherwise (the

                                     - 13 -
<PAGE>

"Total Payments"), would be subject to the excise tax imposed by section 4999 of
the Code or any interest or penalties with respect to such excise tax (such
excise tax, together with any such interest or penalties, are collectively
referred to as the "Excise Tax"), then Executive shall be entitled to receive an
additional payment (an "Excise Tax Restoration Payment") in an amount that shall
fund the payment by Executive of any Excise Tax on the Total Payments as well as
all income taxes imposed on the Excise Tax Restoration Payment, any Excise Tax
imposed on the Excise Tax Restoration Payment and any interest or penalties
imposed with respect to taxes on the Excise Tax Restoration or any Excise Tax.

      9. Offsets; Withholding. Amounts required to be paid by the Company to
Executive pursuant to this Agreement shall not be subject to offset except for
any amounts that are owed to the Company by Executive due to his receipt of
funds as a result of his fraudulent activity. The foregoing and other provisions
of this Agreement notwithstanding (but without limiting the terms of Section 8),
all payments to be made to Executive under this Agreement, including under
Section 7, or otherwise by the Company will be subject to required withholding
taxes and other legally required deductions.

      10. Noncompetition; Nonsolicitation; Nondisclosure; etc.

            10.1 Noncompetition; Nonsolicitation.

                  (a) Executive acknowledges the highly competitive nature of
the Company's business and that access to the Company's confidential records and
proprietary information renders him special and unique within the Company's
industry. In consideration of the amounts that may hereafter be paid to
Executive pursuant to this Agreement (including, without limitation, Sections 4
and 7), Executive agrees that during the Term (and any extensions thereof) and
during the Covered Time (as defined in Section 10.1(e)), Executive, alone or
with others, will not, directly or indirectly, engage (as owner, investor,
partner, stockholder, employer, employee, consultant, advisor, director or
otherwise) in any business in which he has been directly engaged on behalf of
the Company, or which he has supervised as an executive thereof, during the last
two years prior to such termination, or was engaged in by the Company with
Executive's actual knowledge or planned by the Company with Executive's actual
knowledge at the time of such termination, in any geographic area in which such
business was conducted or planned to be conducted (a "Competing Business");
provided, however, that this Section 10.1(a) shall not restrict Executive from
engaging in (and the term "Competing Business" shall not include) any business
in which the Company no longer engages or plans to engage; provided further that
this Section 10.1(a) shall not apply if Executive terminates his employment for
Good Reason pursuant to clause (i), (ii), (iii), (iv), (v), (vi), or (vii) of
Section 6(e) or if Executive's employment is terminated by the Company without
Cause; and provided further that activities of the Company, or activities
engaged in by Executive for or on behalf of the Company, are not restricted by
this Section 10.1(a) and shall not constitute a "Competing Business." Ownership
of (i) the securities of any entity for which a Competing Business represents
less than 10% of net sales or net income (as determined in accordance with
generally accepted accounting principles) for the most recent fiscal year (or if
such entity has not completed a fiscal year, net sales or net income projected
for its first fiscal year) or (ii) not more than two percent of the equity
securities of any company having securities listed on an exchange or regularly
traded in the over-the-counter market shall not, of itself, be deemed
inconsistent with this Section 10.1(a).

                                     - 14 -
<PAGE>

Nothing herein shall require Executive to sell or otherwise dispose of any
securities of any entity if the acquisition of such securities did not violate
the terms of this Section 10.1(a) at the time of such acquisition.

                  (b) In further consideration of the amounts that may hereafter
be paid to Executive pursuant to this Agreement (including, without limitation,
Sections 4, 5, and 7), Executive agrees that during the Term (including any
extensions thereof) and during the Covered Time he shall not, directly or
indirectly, (i) solicit or attempt to induce any of the employees, agents,
consultants or representatives of the Company to terminate his, her, or its
relationship with the Company; (ii) solicit or attempt to induce any of the
employees, agents, consultants or representatives of the Company to become
employees, agents, consultants or representatives of any other person or entity;
(iii) solicit or attempt to induce any customer, vendor or distributor of the
Company to curtail or cancel any business with the Company; or (iv) hire any
person who, to Executive's actual knowledge, is, or was within 180 days prior to
such hiring, an employee of the Company.

                  (c) During the Term (including any extensions thereof) and
during the Covered Time, Executive agrees that upon the earlier of Executive's
(i) negotiating with any Competitor (as defined below) concerning the possible
employment of Executive by the Competitor, (ii) responding to (other than for
the purpose of declining) an offer of employment from a Competitor, or (iii)
becoming employed by a Competitor, (x) Executive will provide copies of Section
10 of this Agreement to the Competitor, and (y) in the case of any circumstance
described in (i) or (ii) above occurring during the Covered Time, and in the
case of any circumstance described in (iii) above occurring during the Term or
during the Covered Time, Executive will promptly provide notice to the Company
of such circumstances. Executive further agrees that the Company may provide
notice to a Competitor of Executive's obligations under this Agreement. For
purposes of this Agreement, "Competitor" shall mean any entity (other than the
Company) that engages, directly or indirectly, in the United States in any
Competing Business.

                  (d) Executive understands that the restrictions in this
Section 10.1 may limit his ability to earn a livelihood in a business similar to
the business of the Company but nevertheless agrees and acknowledges that the
consideration provided under this Agreement (including, without limitation,
Sections 4, 5, and 7) is sufficient to justify such restrictions. In
consideration thereof and in light of Executive's education, skills and
abilities, Executive agrees that he will not assert in any forum that such
restrictions prevent him from earning a living or otherwise should be held void
or unenforceable.

                  (e) For purposes of this Section 10.1, "Covered Time" shall
mean the period beginning on the date of termination of Executive's employment
(the "Date of Termination") and ending twenty-four months after the Date of
Termination; provided, however, that if Executive terminates his employment for
Good Reason pursuant to clause (viii) of Section 6(e), "Covered Time" shall mean
for purposes of Section 10.1(a) the period beginning on the Date of Termination
and ending six months after the Date of Termination.

            10.2 Proprietary Information. Executive acknowledges that during the
course of his employment with the Company he will necessarily have access to and
make use of

                                     - 15 -
<PAGE>

proprietary information and confidential records of the Company. Executive
covenants that he shall not during the Term or at any time thereafter, directly
or indirectly, use for his own purpose or for the benefit of any person or
entity other than the Company, nor otherwise disclose to any individual or
entity, any such proprietary information, unless such disclosure has been
authorized in writing by the Company or is otherwise required by law. The term
"proprietary information" means: (a) the software products, programs,
applications, and processes utilized by the Company; (b) the name and/or address
of any customer or vendor of the Company or any information concerning the
transactions or relations of any customer or vendor of the Company with the
Company; (c) any information concerning any product, technology, or procedure
employed by the Company but not generally known to its customers or vendors or
competitors, or under development by or being tested by the Company but not at
the time offered generally to customers or vendors; (d) any information relating
to the Company's computer software, computer systems, pricing or marketing
methods, sales margins, cost of goods, cost of material, capital structure,
operating results, borrowing arrangements or business plans; (e) any information
identified as confidential or proprietary in any line of business engaged in by
the Company; (f) any information that, to Executive's actual knowledge, the
Company ordinarily maintains as confidential or proprietary; (g) any business
plans, budgets, advertising or marketing plans; (h) any information contained in
any of the Company's written or oral policies and procedures or manuals; (i) any
information belonging to customers, vendors or any other person or entity which
the Company, to Executive's actual knowledge, has agreed to hold in confidence;
(j) any inventions, innovations or improvements covered by this Agreement; and
(k) all written, graphic, electronic data and other material containing any of
the foregoing. Executive acknowledges that information that is not novel or
copyrighted or patented may nonetheless be proprietary information. The term
"proprietary information" shall not include information generally known or
available to the public or generally known or available to the industry or
information that becomes available to Executive on a non-confidential basis from
a source other than the Company or its directors, officers, employees, or agents
(without breach of any obligation of confidentiality of which Executive has
actual knowledge at the time of the relevant disclosure by Executive.)

            10.3 Confidentiality and Surrender of Records. Executive shall not
during the Term or at any time thereafter (irrespective of the circumstances
under which Executive's employment by the Company terminates), except as
required by law, directly or indirectly publish, make known or in any fashion
disclose any confidential records to, or permit any inspection or copying of
confidential records by, any individual or entity other than in the course of
such individual's or entity's employment or retention by the Company, nor shall
he retain, and will deliver promptly to the Company, any of the same following
termination of his employment hereunder for any reason or upon request by the
Company. For purposes hereof, "confidential records" means those portions of
correspondence, memoranda, files, manuals, books, lists, financial, operating or
marketing records, magnetic tape, or electronic or other media or equipment of
any kind in Executive's possession or under his control or accessible to him
which contain any proprietary information. All confidential records shall be and
remain the sole property of the Company during the Term and thereafter.

            10.4 Nondisparagement. Executive shall not, during the Term and
thereafter, disparage in any material respect the Company, any affiliate of the
Company, any of their respective businesses, any of their respective officers,
directors or employees, or the reputation

                                     - 16 -
<PAGE>

of any of the foregoing persons or entities. Notwithstanding the foregoing,
nothing in this Agreement shall preclude Executive from making truthful
statements that are required by applicable law, regulation or legal process or
are reasonably required to describe the conduct, decisions, or policies of the
Company or any of its affiliates, or their respective businesses, officers,
directors or employees.

            10.5 No Other Obligations. Executive represents that he is not
precluded or limited in his ability to undertake or perform the duties described
herein by any contract, agreement or restrictive covenant. Executive covenants
that he shall not employ the trade secrets or proprietary information of any
other person in connection with his employment by the Company without such
person's authorization.

            10.6 Forfeiture of Outstanding Options. The provisions of Section 7
notwithstanding, if Executive willfully and materially fails to comply with any
restrictive covenant under Section 10.1(a) (other than the first sentence
thereof), 10.1(b), 10.2 (other than the first and penultimate sentences
thereof), 10.3, 10.4, or 10.8, all options to purchase Common Stock granted by
the Company and then held by Executive or a transferee of Executive shall be
immediately forfeited and thereupon such options shall be cancelled.
Notwithstanding the foregoing, Executive shall not forfeit any option (i) unless
there shall have been delivered to him, within ninety (90) days after the Board
(A) had knowledge of conduct or an event allegedly constituting grounds for such
forfeiture and (B) had reason to believe that such conduct or event could be
grounds for such forfeiture, a copy of a resolution duly adopted by the Board by
a vote of Directors constituting a majority of the Board (excluding Executive)
at a meeting of the Board in which a quorum is present and which is called and
held for such purpose (after giving Executive reasonable notice specifying the
nature of the grounds for such forfeiture and not less than 30 days to correct
such grounds and affording Executive and his counsel the opportunity to be heard
before the Board) finding that, in the good faith opinion of the Board,
Executive has engaged and continues to engage in conduct set forth in this
Section 10.6 which constitutes grounds for forfeiture of Executive's options;
and (ii) if, within 30 days following his receipt of such resolution, Executive
commences an arbitration proceeding in accordance with Section 18.2 disputing
such grounds, in which case such forfeiture shall be tolled pending the
resolution of Executive's claim and shall not occur if the arbitration panel
finds that the Company is not entitled to cause the forfeiture.

            If the arbitration panel finds that the Company is entitled to cause
the forfeiture of Executive's options, Executive shall be required to forfeit
such options immediately. If any option is exercised after delivery of the
Board's notice of forfeiture and if such forfeiture subsequently occurs pursuant
to the foregoing terms of this Section 10.6, Executive shall be required to
return to the Company all shares acquired upon such exercise; provided further
that if Executive has sold any shares he acquired upon such exercise, Executive
shall pay to the Company an amount equal to the difference between the aggregate
sale price of the shares sold and the aggregate exercise price paid by Executive
for such shares. Any such forfeiture shall apply to such options notwithstanding
any term or provision of any option agreement. If the Board or the arbitration
panel finds that the Company is not entitled to cause a forfeiture for which a
notice is given to Executive, the Company shall pay (or reimburse, if already
paid by Executive) all expenses actually incurred by Executive in connection
with such attempted forfeiture.

                                     - 17 -
<PAGE>

            10.7 Enforcement. Executive acknowledges and agrees that, by virtue
of his position, services and access to and use of confidential records and
proprietary information, any violation by him of any of the undertakings
contained in this Section 10 would cause the Company immediate, substantial and
irreparable injury for which it has no adequate remedy at law. Accordingly,
Executive agrees and consents to the entry of an injunction or other equitable
relief by a court of competent jurisdiction restraining any violation or
threatened violation of any undertaking contained in this Section 10. The
Company agrees and consents to the entry of an injunction or other equitable
relief by a court of competent jurisdiction restraining the Company from making
any defamatory statements, whether orally or in writing, relating to alleged
violations or threatened violations by Executive of any undertaking contained in
this Section 10. Executive and the Company each waive posting of any bond
otherwise necessary to secure such injunction or other equitable relief. Rights
and remedies provided for in this Section 10 are cumulative and shall be in
addition to rights and remedies otherwise available to the parties hereunder or
under any other agreement or applicable law. Subject to Section 18.3, the
Company shall bear all costs and expenses arising in connection with any
enforcement pursuant to this Section 10.7.

            10.8 Cooperation with Regard to Litigation. Except to the extent
that Executive has or intends to assert in good faith an interest or position
adverse to or inconsistent with the interest or position of the Company,
Executive agrees to cooperate reasonably with the Company, during the Term and
thereafter (including following Executive's termination of employment for any
reason), by making himself reasonably available to testify on behalf of the
Company in any action, suit, or proceeding, whether civil, criminal,
administrative, or investigative, and reasonably to assist the Company in any
such action, suit, or proceeding, by providing information and meeting and
consulting with the Board or its representatives or counsel, or representatives
or counsel to the Company, in each case, as reasonably requested by the Company.
The Company agrees to pay (or reimburse, if already paid by Executive) all
expenses actually incurred in connection with Executive's cooperation and
assistance including, without limitation, reasonable fees and disbursements of
counsel, if any, chosen by Executive if Executive reasonably determines in good
faith, on the advice of counsel, that it is appropriate that Executive be
separately represented by his own counsel in such proceeding. Without limiting
the foregoing, after the expiration of this Agreement or the termination of
Executive's employment by the Company for any reason, such cooperation and
assistance shall not require Executive to forgo or significantly interrupt any
professional or personal commitment that he reasonably deems significant or to
take any action (including, without limitation, travel to, attendance at or
preparation for any meeting, deposition or other proceeding or event of any
type) that, in his reasonable judgment, could impair his ability to perform the
responsibilities of, or could jeopardize the continuation of, his then current
employment, or would otherwise impose any undue burden on Executive.

            10.9 Survival. The provisions of this Section 10 shall survive the
termination of the Term and any termination or expiration of this Agreement.

            10.10 Company. For purposes of this Section 10, references to the
"Company" shall include both the Company and each subsidiary of the Company.

                                     - 18 -
<PAGE>

      11. Insurance for the Company's Benefit. The Company may at any time and
for the Company's own benefit (or for the benefit of a lender to the Company)
apply for and take out life, health, accident or other insurance covering
Executive, either independently or together with others, in any amount which the
Company may deem to be in its best interests. The Company shall own all rights
in such insurance and proceeds thereof and Executive shall not have any right,
title or interest therein. Executive shall assist the Company at the Company's
expense in obtaining and maintaining any such insurance by submitting to
reasonable and customary medical examinations and preparing, signing and
delivering such applications and other documents as reasonably may be required.

      12. Indemnification. During the Term of this Agreement and all periods
after the expiration of this Agreement or termination of Executive's employment
for any reason, the Company shall indemnify Executive to the full extent
permitted under the Company's Certificate of Incorporation or By-Laws and
pursuant to any other agreements or policies in effect from time to time;
provided, however, that Executive shall at all times have at least all rights to
indemnification by the Company as are provided in the Company's Certificate of
Incorporation or By-Laws or pursuant to other agreements in effect on or
immediately prior to the Effective Date, and the Company shall also advance
expenses for which indemnification may be ultimately claimed as such expenses
are incurred to the fullest extent permitted under applicable law, subject to
any requirement that Executive provide an undertaking to repay such advances if
it is ultimately determined that Executive is not entitled to indemnification;
provided, however, that any determination required to be made with respect to
whether Executive's conduct complies with the standards required to be met as a
condition of indemnification or advancement of expenses under applicable law and
the Company's Certificate of Incorporation, By-Laws, or other agreement, shall
be made by independent counsel mutually acceptable to Executive and the Company
(except to the extent otherwise required by law). After the Effective Date, the
Company shall not amend its Certificate of Incorporation or By-Laws or any
agreement in any manner which adversely affects the rights of Executive to
indemnification thereunder. Any provision contained herein notwithstanding, this
Agreement shall not limit or reduce, and the Company hereby agrees to provide to
Executive, any and all rights to indemnification to the full extent permitted
under applicable law. In addition, the Company will maintain directors' and
officers' liability insurance in effect and covering acts and omissions of
Executive during the Term and for a period of six years thereafter on terms
substantially no less favorable than those in effect on the Effective Date. The
indemnification rights made available to Executive pursuant to this Section 12
shall at all times be at least as favorable to Executive as the indemnification
rights made available at such times to any other employee of the Company. For
purposes of this Section 12, references to the "Company" shall include both the
Company and each of its subsidiaries for which Executive has acted, acts or will
in the future act in any capacity. The provisions of this Section 12 shall
survive the termination of the Term and any termination or expiration of this
Agreement.

      13. Notices. Whenever under this Agreement it becomes necessary to give
notice, such notice shall be in writing, signed by the party or parties giving
or making the same, and shall be served on the person or persons for whom it is
intended or who should be advised or notified, by Federal Express or other
similar overnight service or by certified or registered mail, return receipt
requested, postage prepaid and addressed to such party at the address set forth
below or at such other address as may be designated by such party by like
notice:

                                     - 19 -
<PAGE>

           To the Company:

                          Scientific Games Corporation
                          750 Lexington Avenue
                          25th Floor
                          New York, New York 10022
                          Attention: General Counsel

           With a copy to:

                          Kramer Levin Naftalis & Frankel LLP
                          919 Third Avenue
                          New York, NY 10022
                          (212) 715-9100
                          Attention: Peter G. Smith, Esq.

           To Executive:

                          A. Lorne Weil
                          51 East 90th Street
                          Penthouse B
                          New York, New York 10128

           With a copy to:

                          Hogan & Hartson L.L.P.
                          885 Third Avenue
                          New York, New York 10022
                          Attention: Andrew J. Trubin, Esq.

If the parties by mutual written agreement supply each other with telecopier
numbers for the purposes of providing notice by facsimile, such notice shall
also be proper notice under this Agreement and shall be deemed given on the next
business day after the date on which successful and complete transmission is
confirmed by the receiving facsimile machine or otherwise confirmed in writing
on behalf of the recipient. In the case of Federal Express or other similar
overnight service, such notice or advice shall be effective on the next business
day after it is sent, and, in the cases of certified or registered mail, shall
be effective 5 days after deposit into the mails by delivery to the U.S. Postal
Service.

      14. Assignability; Binding Effect. Neither this Agreement nor the rights
or obligations hereunder of the parties hereto shall be transferable or
assignable by Executive, except in accordance with the laws of descent and
distribution and as specified below. The Company may assign this Agreement and
the Company's rights and obligations hereunder, and shall assign this Agreement
and such rights and obligations, to any Successor (as hereinafter defined)
which, by operation of law or otherwise, continues to carry on substantially the
business of the Company prior to the event of succession, and the Company shall,
as a condition of the

                                     - 20 -
<PAGE>

succession, require such Successor to agree in writing to assume the Company's
obligations and be bound by this Agreement. For purposes of this Agreement,
"Successor" shall mean any person that succeeds to, or has the practical ability
to control, the Company's business directly or indirectly, by merger or
consolidation, by purchase or ownership of voting securities of the Company or
all or substantially all of its assets, or otherwise. This Agreement shall be
binding upon and inure to the benefit of Executive, his heirs, executors,
administrators, and beneficiaries, and shall be binding upon and inure to the
benefit of the Company and its successors and assigns.

      15. Complete Understanding; Amendment; Waiver. This Agreement constitutes
the complete understanding between the parties with respect to the employment of
Executive and supersedes all other prior agreements and understandings, both
written and oral, between the parties with respect to the subject matter hereof
(including the Old Agreement), except as provided in Section 12, and no
statement, representation, warranty or covenant has been made by either party
with respect thereto except as expressly set forth herein. This Agreement shall
not be modified, amended or terminated except by a written instrument signed by
each of the parties. Any waiver of any term or provision hereof, or of the
application of any such term or provision to any circumstances, shall be in
writing signed by the party charged with giving such waiver. Waiver by either
party of any breach hereunder by the other party shall not operate as a waiver
of any other breach, whether similar to or different from the breach waived. No
delay by either party in the exercise of any rights or remedies shall operate as
a waiver thereof, and no single or partial exercise by either party of any such
right or remedy shall preclude other or further exercise thereof.

      16. Severability. If any provision of this Agreement or the application of
any such provision to any person or circumstances shall be determined by any
court of competent jurisdiction to be invalid or unenforceable to any extent,
the remainder of this Agreement, or the application of such provision to such
person or circumstances other than those to which it is so determined to be
invalid or unenforceable, shall not be affected thereby, and each provision
hereof shall be enforced to the fullest extent permitted by law. If any
provision of this Agreement, or any part thereof, is held to be invalid or
unenforceable because of the scope or duration of or the area covered by such
provision, the parties hereto agree that the court making such determination
shall reduce the scope, duration and/or area of such provision (and shall
substitute appropriate provisions for any such invalid or unenforceable
provisions) in order to make such provision enforceable to the fullest extent
permitted by law and/or shall delete specific words and phrases, and such
modified provision shall then be enforceable and shall be enforced. The parties
hereto recognize that if, in any judicial proceeding, a court shall refuse to
enforce any of the separate covenants contained in this Agreement, then that
invalid or unenforceable covenant contained in this Agreement shall be deemed
eliminated from these provisions to the extent necessary to permit the remaining
separate covenants to be enforced. In the event that any court determines that
the time period or the area, or both, are unreasonable and that any of the
covenants is to that extent invalid or unenforceable, the parties hereto agree
that such covenants will remain in full force and effect, first, for the
greatest time period, and second, in the greatest geographical area that would
not render them unenforceable. To the extent that a court of competent
jurisdiction determines that Executive willfully and materially breached Section
10.1(a) (other than the first sentence thereof), 10.1(b), 10.2 (other than the
first and penultimate sentences thereof), 10.3, 10.4, or 10.8, the Company's
obligations to make payments hereunder shall immediately be limited to the
amounts, if any, remaining to be paid pursuant to

                                     - 21 -
<PAGE>

Section 7(b) to the extent not theretofore paid, provided that the Company's
obligations to make such greater payments shall immediately be reinstated in the
event that the determination of such court is overturned or reversed by any
higher court.

      17. Survivability. The provisions of this Agreement which by their terms
call for performance subsequent to termination of Executive's employment
hereunder, or of this Agreement, shall so survive such termination, whether or
not such provisions expressly state that they shall so survive.

      18. Governing Law; Arbitration; Expenses; Interest.

            18.1 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
agreements made and to be wholly performed within that State, without regard to
its conflict of laws provisions.

            18.2 Arbitration. Any dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration in
New York, New York by three arbitrators in accordance with the rules of the
American Arbitration Association in effect at the time of submission to
arbitration; provided, however, that the Company shall be entitled to commence
an action in any court of competent jurisdiction to enforce Section 10, in part
or in its entirety. Judgment may be entered on the arbitrators' award in any
court having jurisdiction. For purposes of entering such judgment or seeking
enforcement of Section 10, the Company and Executive hereby consent to the
jurisdiction of any or all of the following courts: (i) the United States
District Court for the Southern District of New York; (ii) any of the courts of
the State of New York or the State of Delaware; or (iii) any other court having
jurisdiction. The Company and Executive further agree that any service of
process or notice requirements in any such proceedings shall be satisfied if the
rules of such court relating thereto have been substantially satisfied. The
Company and Executive hereby waive, to the fullest extent permitted by
applicable law, any objection which either may now or hereafter have to such
jurisdiction and any defense of inconvenient forum. The Company and Executive
hereby agree that a judgment upon an award rendered by the arbitrators may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Subject to Section 18.3, the Company shall bear all costs and
expenses arising in connection with any arbitration proceeding pursuant to this
Section 18.2. Notwithstanding any provision in this Section 18, Executive shall
be entitled to seek in any court of competent jurisdiction specific performance
of Executive's right (which is hereby acknowledged and agreed to by the Company)
to be paid all compensation, benefits and other amounts required to be paid
during the pendency of any dispute or controversy arising under or in connection
with this Agreement, which, to the extent such amounts are paid by the Company
(or, in the case of a termination of Executive's employment by the Company
without Cause, are so paid in respect of periods commencing after 90 days
following the date of such termination) shall be credited against the total
amounts otherwise finally determined to be owed to Executive pursuant to this
Agreement.

            18.3 Reimbursement of Expenses in Enforcing Rights. All reasonable
costs and expenses (including, without limitation, reasonable fees and
disbursements of counsel) incurred by Executive in seeking to interpret this
Agreement or enforce rights pursuant to this Agreement shall be paid by the
Company on behalf of Executive (or, if already paid by

                                     - 22 -
<PAGE>

Executive, reimbursed to Executive by the Company) as such costs and expenses
are incurred. If any claim of Executive is found to be frivolous by a final,
nonappealable determination of the arbitration panel or court hearing the claim,
Executive shall reimburse the Company within 30 days of such determination for
all amounts paid by the Company under this Section 18.3 in connection with the
claim.

            18.4 Interest on Unpaid Amounts. Any amounts that have become
payable pursuant to the terms of this Agreement or any decision by arbitrators
or judgment by a court of law pursuant to this Agreement but which are not
timely paid shall bear interest at the prime rate in effect at the time such
payment first becomes payable, as quoted by the Company's principal bank.

      19. Reimbursement of Expenses of Executive in Negotiating Agreement. All
reasonable costs and expenses (including, without limitation, reasonable fees
and disbursements of counsel) incurred by Executive in connection with the
negotiation, preparation, execution, or delivery of this Agreement shall be paid
on behalf of Executive (or, if already paid by Executive, reimbursed to
Executive) promptly by the Company.

      20. Titles and Captions. All paragraph titles or captions in this
Agreement are for convenience only and in no way define, limit, extend or
describe the scope or intent of any provision hereof.

            IN WITNESS WHEREOF, each of the parties hereto has duly executed
this Agreement as of the date first above written.

                                        SCIENTIFIC GAMES CORPORATION

                                        By:_____________________________________
                                        Name:
                                        Title:

                                        ________________________________________
                                        A. Lorne Weil

                                     - 23 -

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