Document:

International Game Technology
Deferred Compensation Plan
Master Plan Document
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                           Effective September 1, 1999

                               Copyright (C) 1999
                      By Compensation Resource Group, Inc.
                               All Rights Reserved

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International Game Technology
Deferred Compensation Plan
Master Plan Document
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                                TABLE OF CONTENTS
                                                                           Page

Purpose             .......................................................1

ARTICLE 1           Definitions............................................1

ARTICLE 2           Selection, Enrollment, Eligibility.....................5

           2.1      Selection by Committee.................................5
           2.2      Enrollment Requirements................................6
           2.3      Eligibility; Commencement of Participation.............6
           2.4      Termination of Participation and/or Deferrals..........6

ARTICLE 3           Deferral Commitments/Profit Sharing Restoration
                      Contribution/Crediting/Taxes.........................6

           3.1      Minimum Deferrals......................................6
           3.2      Maximum Deferral.......................................7
           3.3      Election to Defer; Effect of Election Form.............7
           3.4      Withholding of Annual Deferral Amounts.................8
           3.5      Annual Company Contribution Amount.....................8
           3.6      Annual Profit Sharing Restoration
                      Contribution Amount..................................8
           3.7      Vesting................................................8
           3.8      Crediting/Debiting of Account Balances.................9
           3.9      FICA and Other Taxes..................................11

ARTICLE 4           Short-Term Payout; Withdrawal Election................12

           4.1      Short-Term Payout.....................................12
           4.2      Other Benefits Take Precedence Over Short-Term........12
           4.3      Withdrawal Election...................................12

ARTICLE 5           Retirement Benefit....................................13

           5.1      Retirement Benefit....................................13
           5.2      Payment of Retirement Benefit.........................13
           5.3      Death Prior to Completion of Retirement Benefit.......13

ARTICLE 6           Pre-Retirement Survivor Benefit.......................13

           6.1      Pre-Retirement Survivor Benefit.......................13
           6.2      Payment of Pre-Retirement Survivor Benefit............13

<PAGE>

ARTICLE 7           Termination Benefit.....................................14

           7.1      Termination Benefit.....................................14
           7.2      Payment of Termination Benefit..........................14

ARTICLE 8           Disability Waiver and Benefit...........................14

           8.1      Disability Waiver.......................................14
           8.2      Continued Eligibility; Disability Benefit...............14

ARTICLE 9           Beneficiary Designation.................................15

           9.1      Beneficiary.............................................15
           9.2      Beneficiary Designation; Change; Spousal Consent........15
           9.3      Acknowledgement.........................................15
           9.4      No Beneficiary Designation..............................15
           9.5      Doubt as to Beneficiary.................................15
           9.6      Discharge of Obligations................................15

ARTICLE 10          Leave of Absence........................................15

           10.1     Paid Leave of Absence...................................15
           10.2     Unpaid Leave of Absence.................................16

ARTICLE 11          Termination, Amendment or Modification..................16

           11.1     Termination.............................................16
           11.2     Amendment...............................................16
           11.3     Plan Agreement..........................................17
           11.4     Effect of Payment.......................................17

ARTICLE 12          Administration..........................................17

           12.1     Committee Duties........................................17
           12.2     Administration Upon Change In Control...................17
           12.3     Agents..................................................18
           12.4     Binding Effect of Decisions.............................18
           12.5     Indemnity of Committee..................................18
           12.6     Employer Information....................................18

ARTICLE 13          Other Benefits and Agreements...........................18

           13.1     Coordination with Other Benefits........................18

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ARTICLE 14          Claims Procedures.......................................19

           14.1     Presentation of Claim...................................19
           14.2     Notification of Decision................................19
           14.3     Review of a Denied Claim................................19
           14.4     Decision on Review......................................19
           14.5     Legal Action............................................20

ARTICLE 15          Trust...................................................20

           15.1     Establishment of the Trust..............................20
           15.2     Interrelationship of the Plan and the Trust.............20
           15.3     Distributions From the Trust............................20

ARTICLE 16          Miscellaneous...........................................20

           16.1     Status of Plan..........................................20
           16.2     Unsecured General Creditor..............................20
           16.3     Employer's Liability....................................21
           16.4     Nonassignability........................................21
           16.5     Not a Contract of Employment............................21
           16.6     Furnishing Information..................................21
           16.7     Terms...................................................21
           16.8     Captions................................................21
           16.9     Governing Law...........................................21
           16.10    Notice..................................................21
           16.11    Successors..............................................22
           16.12    Spouse's Interest.......................................22
           16.13    Validity................................................22
           16.14    Incompetent.............................................22
           16.15    Court Order.............................................22
           16.16    Distribution in the Event of Taxation...................22
           16.17    Insurance...............................................23
           16.18    Legal Fees To Enforce Rights After Change in Control....23

<PAGE>

                          INTERNATIONAL GAME TECHNOLOGY
                           DEFERRED COMPENSATION PLAN
                           Effective September 1, 1999

                                     Purpose

         The purpose of this Plan is to provide  specified  benefits to a select
group of management and highly compensated  Employees who contribute  materially
to  the  continued   growth,   development  and  future   business   success  of
International Game Technology,  a Nevada corporation,  and its subsidiaries,  if
any,  that sponsor  this Plan.  This Plan shall be unfunded for tax purposes and
for purposes of Title I of ERISA.

                                    ARTICLE 1
                                   Definitions

         For purposes of this Plan,  unless otherwise  clearly apparent from the
context,  the  following  phrases or terms  shall have the  following  indicated
meanings:

1.1      "Account  Balance" shall mean, with respect to a Participant,  a credit
         on the  records of the  Employer  equal to the sum of (i) the  Deferral
         Account balance,  (ii) the vested Company Contribution Account balance,
         and (iii) the vested Profit Sharing  Restoration  Contribution  Account
         balance. The Account Balance, and each other specified account balance,
         shall be a  bookkeeping  entry only and shall be  utilized  solely as a
         device for the measurement and  determination of the amounts to be paid
         to a  Participant,  or his or her designated  Beneficiary,  pursuant to
         this Plan.

1.2      "Annual Cash Sharing"  shall mean any  compensation  based upon Company
         profitability  and payable to a  Participant  as an Employee in May and
         November under the Company's cash sharing plan.

1.3      "Annual   Commissions"  shall  mean  any  compensation   payable  to  a
         Participant as an Employee based upon his or her sales,  excluding Base
         Annual Salary, Annual Discretionary Cash Bonus and Annual Cash Sharing.

1.4      "Annual Company Contribution Amount" shall mean, for any one Plan Year,
         the amount determined in accordance with Section 3.5.

1.5      "Annual  Deferral  Amount"  shall mean that portion of a  Participant's
         Base  Annual  Salary,  Annual  Discretionary  Cash  Bonus,  Annual Cash
         Sharing and/or Annual  Commissions  that a Participant  elects to have,
         and is deferred,  in accordance  with Article 3, for any one Plan Year.
         In the event of a  Participant's  Retirement,  Disability (if deferrals
         cease in  accordance  with  Section  8.1),  death or a  Termination  of
         Employment prior to the end of a Plan Year, such year's Annual Deferral
         Amount shall be the actual amount withheld prior to such event.

1.6      "Annual  Discretionary  Cash  Bonus"  shall mean any  compensation,  in
         addition to Base Annual Salary  relating to services  performed  during
         any calendar year,  whether or not paid in such calendar year,  payable
         to a Participant as an Employee under any Employer's  annual cash bonus
         and cash incentive plans, excluding stock options.

<PAGE>

1.7      "Annual Installment Method" shall be an annual installment payment over
         the number of years selected by the Participant in accordance with this
         Plan,  calculated as follows:  The Account  Balance of the  Participant
         shall be  calculated  as of the close of business on the last  business
         day  of the  year.  The  annual  installment  shall  be  calculated  by
         multiplying this balance by a fraction,  the numerator of which is one,
         and the denominator of which is the remaining number of annual payments
         due the  Participant.  By way of example,  if the Participant  elects a
         10-year Annual  Installment  Method, the first payment shall be 1/10 of
         the Account Balance,  calculated as described in this  definition.  The
         following  year,  the  payment  shall  be 1/9 of the  Account  Balance,
         calculated  as described in this  definition.  Each annual  installment
         shall be paid on or as soon as practicable  after the last business day
         of the applicable year.

1.8      "Annual Profit  Sharing  Restoration  Contribution  Amount" for any one
         Plan Year shall be the amount  determined  in  accordance  with Section
         3.6.

1.9      "Base Annual Salary" shall mean the annual cash  compensation  relating
         to services  performed during any calendar year, whether or not paid in
         such calendar  year,  excluding  bonuses,  cash  sharing,  commissions,
         overtime,   fringe  benefits,   stock  options,   relocation  expenses,
         incentive payments, non-monetary awards, and other fees, automobile and
         other allowances paid to a Participant for employment services rendered
         (whether or not such  allowances are included in the  Employee's  gross
         income).  Base Annual Salary shall be calculated  before  reduction for
         compensation  voluntarily  deferred or contributed  by the  Participant
         pursuant to all  qualified or  non-qualified  plans of any Employer and
         shall be  calculated to include  amounts not otherwise  included in the
         Participant's gross income under Code Sections 125, 402(e)(3),  402(h),
         or 403(b)  pursuant to plans  established  by any  Employer;  provided,
         however, that all such amounts will be included in compensation only to
         the extent  that,  had there been no such plan,  the amount  would have
         been payable in cash to the Employee.

1.10     "Beneficiary" shall mean one or more persons,  trusts, estates or other
         entities, designated in accordance with Article 9, that are entitled to
         receive benefits under this Plan upon the death of a Participant.

1.11     "Beneficiary  Designation  Form" shall mean the form  established  from
         time to time by the Committee that a Participant  completes,  signs and
         returns to the Committee to designate one or more Beneficiaries.

1.12     "Board" shall mean the board of directors of the Company.

1.13     "Change in Control" shall mean the first to occur of any of the
          following events:

(a)               Any  "person" (as that term is used in Section 13 and 14(d)(2)
                  of the  Securities  Exchange  Act of  1934  ("Exchange  Act"))
                  becomes the beneficial  owner (as that term is used in Section
                  13(d) of the Exchange Act),  directly or indirectly,  of fifty
                  percent (50%) or more of the Company's  capital stock entitled
                  to vote in the election of directors;

(b)               During any  period of  not more  than two  consecutive  years,
                  not including  any period prior  to the adoption of this Plan,
                  individuals who,  at the beginning  of such period  constitute
                  the board of directors of the  Company,  and any new  director
                  other   than a  director   designated   by a  person  who  has
                  entered  into an  agreement  with  the Company  to  effect   a

<PAGE>

                  transaction  described  in clause  (a), (c),(d) or (e) of this
                  Section  1.10) whose  election  by the board of  directors  or
                  nomination  for election  by  the  Company's  stockholders was
                  approved by a vote  of at  least three-fourths  (3/4ths)of the
                  directors   then  still in office,  who either were  directors
                  at the beginning of the period or whose election or nomination
                  for election was previously so approved,  cease for any reason
                  to constitute at least a majority thereof;

(c)               The  shareholders of the Company approve any  consolidation or
                  merger of the Company, other than a consolidation or merger of
                  the  Company in which the  holders of the common  stock of the
                  Company  immediately prior to the consolidation or merger hold
                  more  than  fifty  percent  (50%) of the  common  stock of the
                  surviving  corporation  immediately after the consolidation or
                  merger;

(d)               The  shareholders  of the Company approve any plan or proposal
                  for the liquidation  or dissolution of the Company; or

(e)               The  shareholders  of the Company approve the sale or transfer
                  of all or  substantially  all of the assets of the  Company to
                  parties   that  are  not   within  a   "controlled   group  of
                  corporations"  (as defined in Code Section  1563) in which the
                  Company is a member.

1.14     "Claimant" shall have the meaning set forth in Section 14.1.

1.15     "Code" shall mean the Internal Revenue Code of 1986, as it may be
         amended from time to time.

1.16     "Committee" shall mean the Profit Sharing Plan committee.

1.17     "Company"shall mean International Game Technology,a Nevada corporation,
         and any successor.

1.18     "Company   Contribution   Account"  shall  mean  (i)  the  sum  of  the
         Participant's  Annual Company Contribution  Amounts,  plus (ii) amounts
         credited in accordance with all the applicable  crediting provisions of
         this  Plan  that  relate  to  the  Participant's  Company  Contribution
         Account, less (iii) all distributions made to the Participant or his or
         her Beneficiary  pursuant to this Plan that relate to the Participant's
         Company Contribution Account.

1.19     "Deduction Limitation" shall mean the following described limitation on
         a  benefit  that  may  otherwise  be  distributable   pursuant  to  the
         provisions of this Plan. Except as otherwise provided,  this limitation
         shall  be  applied  to  all  distributions  that  are  "subject  to the
         Deduction  Limitation"  under this Plan.  If an Employer  determines in
         good  faith  prior to a Change in Control  that  there is a  reasonable
         likelihood that any compensation otherwise payable to a Participant for
         a taxable year of the Employer  would not be deductible by the Employer
         solely by reason of the limitation under Code Section 162(m),  then, to
         the extent deemed necessary by the Employer in its discretion to ensure
         that the entire amount of any distribution to the Participant  pursuant
         to this Plan prior to the Change in Control is deductible, the Employer
         may defer all or any portion of a distribution  otherwise payable under
         this Plan.  Any  amounts  deferred  pursuant to this  limitation  shall
         continue to be  credited/debited  with additional amounts in accordance
         with  Section  3.9  below,  even if such  amount  is being  paid out in
         installments.  The amounts so deferred  and  amounts  credited  thereon
         shall be distributed to the  Participant or his or her  Beneficiary (in
         the event of the Participant's death) at the earliest possible date, as

<PAGE>

         determined by the Employer in good faith, on which the deductibility of
         compensation paid or payable to the Participant for the taxable year of
         the Employer during which the  distribution is made will not be limited
         by Section  162(m),  or if earlier,  the effective  date of a Change in
         Control.  Notwithstanding  anything to the  contrary in this Plan,  the
         Deduction Limitation shall not apply after a Change in Control.

1.20     "Deferral  Account"  shall  mean (i) the sum of all of a  Participant's
         Annual Deferral Amounts,  plus (ii) amounts credited in accordance with
         all the applicable crediting provisions of this Plan that relate to the
         Participant's  Deferral Account,  less (iii) all distributions  made to
         the  Participant or his or her  Beneficiary  pursuant to this Plan that
         relate to his or her Deferral Account.

1.21     "Disability"   shall  mean  a  period  of  disability  during  which  a
         Participant  qualifies  for  permanent  disability  benefits  under the
         Participant's   Employer's   long-term   disability   plan,  or,  if  a
         Participant does not participate in such a plan, a period of disability
         during  which  the  Participant  would  have  qualified  for  permanent
         disability  benefits  under  such a plan  had  the  Participant  been a
         participant in such a plan, as determined in the sole discretion of the
         Committee.  If the Participant's Employer does not sponsor such a plan,
         or discontinues to sponsor such a plan,  Disability shall be determined
         by the Committee in its sole discretion.

1.22     "Disability Benefit" shall mean the benefit set forth in Article 8.

1.23     "Election Form" shall mean a written form established from time to time
         by the Committee that a Participant  must complete,  sign and return to
         the Committee to make an election under the Plan.

1.24     "Employee" shall mean a person who is an employee of any Employer.

1.25     "Employer(s)"  shall mean the  Company  and/or any of its  subsidiaries
         (now in  existence  or  hereafter  formed or  acquired)  that have been
         selected by the Board to  participate  in the Plan and have adopted the
         Plan as a sponsor.

1.26     "ERISA" shall mean the Employee Retirement Income Security Act of 1974,
         as it may be amended from time to time.

1.27     "First Plan Year" shall mean the period beginning September 1, 1999 and
         ending December 31, 1999.

1.28     "Participant"   shall  mean  any   Employee  (i)  who  is  selected  to
         participate  in the Plan,  (ii) who elects to  participate in the Plan,
         (iii) who signs a Plan  Agreement,  an Election  Form and a Beneficiary
         Designation  Form, (iv) whose signed Plan Agreement,  Election Form and
         Beneficiary  Designation  Form are accepted by the  Committee,  (v) who
         commences  participation in the Plan, and (vi) whose Plan Agreement has
         not terminated. A spouse or former spouse of a Participant shall not be
         treated as a Participant  in the Plan or have an account  balance under
         the  Plan,  even  if he or she  has an  interest  in the  Participant's
         benefits  under  the Plan as a result  of  applicable  law or  property
         settlements resulting from legal separation or divorce.

1.29     "Plan" shall mean the Company's Deferred Compensation Plan, which shall
         be evidenced by this instrument and by each Plan Agreement, as they may
         be amended from time to time.

<PAGE>

1.30     "Plan Agreement" shall mean a written agreement,  in a form approved by
         the  Committee  and as it may be  amended  from time to time,  which is
         entered  into by and between an Employer and a  Participant.  Each Plan
         Agreement  executed by a  Participant  and the  Participant's  Employer
         shall  provide  for the entire  benefit to which  such  Participant  is
         entitled under the Plan;  should there be more than one Plan Agreement,
         the  Plan  Agreement  bearing  the  latest  date of  acceptance  by the
         Employer shall supersede all previous Plan Agreements in their entirety
         and shall govern such entitlement.  The terms of any Plan Agreement may
         be different for any  Participant,  and any Plan  Agreement may provide
         additional  benefits  not set forth in the Plan or limit  the  benefits
         otherwise  provided under the Plan;  provided,  however,  that any such
         additional  benefits or benefit  limitations  must be agreed to by both
         the Employer and the Participant.

1.31     " Plan  Year"  shall,  except  for the First Plan  Year,  mean a period
         beginning on January 1 of each  calendar  year  and  continuing through
         December 31 of  such calendar year.

1.32     "Pre-Retirement  Survivor Benefit" shall  mean the benefit set forth in
         Article 6.

1.33     "Profit Sharing Plan" shall be that certain IGT Profit Sharing Plan, as
         amended from time to time.

1.34     "Profit Sharing  Restoration  Contribution  Account" shall mean (i) the
         sum  of  all  of a  Participant's  Annual  Profit  Sharing  Restoration
         Contribution Amounts, plus (ii) amounts credited in accordance with all
         the  applicable  crediting  provisions  of this Plan that relate to the
         Participant's  Profit Sharing Restoration  Contribution  Account,  less
         (iii)  all  distributions  made  to  the  Participant  or  his  or  her
         Beneficiary  pursuant  to this  Plan that  relate to the  Participant's
         Profit Sharing Restoration Contribution Account.

1.35     "Retirement",  "Retire(s)" or "Retired"  shall mean, with respect to an
         Employee,  severance from  employment from all Employers for any reason
         other  than a leave of  absence,  death or  Disability  on or after the
         attainment of age fifty-five (55).

1.36     "Retirement Benefit" shall mean the benefit set forth in Article 5.

1.37     "Short-Term Payout" shall mean the payout set forth in Section 4.1.

1.38     "Termination Benefit" shall mean the benefit set forth in Article 7.

1.39     "Termination of Employment"  shall mean the severing of employment with
         all Employers,  voluntarily or involuntarily, for any reason other than
         Retirement, Disability, death or an authorized leave of absence.

1.40     "Trust"  shall mean one or more  trusts  established  pursuant  to that
         certain Master Trust Agreement,  dated as of ________, 199_ between the
         Company and the trustee named therein, as amended from time to time.

1.41     "Years of Vesting  Service" shall mean,  with respect to a Participant,
         his or her  total  years  of  vesting  service  as  defined  in and for
         purposes of the Profit Sharing Plan.

                                    ARTICLE 2
                       Selection, Enrollment, Eligibility

2.1      Selection by Committee. Participation in the Plan shall be limited to a
         select  group of  management  and highly  compensated  Employees of the
         Employers, as determined by the Committee in its sole discretion.  From
         that group, the Committee shall select,  in its sole discretion,  those
         Employees who may actually elect to participate in the Plan.

<PAGE>

2.2      Enrollment Requirements. As a condition to participation, each selected
         Employee who wishes to participate in the Plan shall complete,  execute
         and return to the  Committee a Plan  Agreement,  an Election Form and a
         Beneficiary  Designation  Form,  all  within 30 days after he or she is
         selected to participate in the Plan. In addition,  the Committee  shall
         establish from time to time such other  enrollment  requirements  as it
         determines in its sole  discretion are necessary.  A selected  Employee
         whose Plan Agreement, Election Form and Beneficiary Designation are not
         received  by the  Committee  within  such 30 day  period  shall  not be
         eligible to  participate in the Plan unless we or she is again selected
         by the Committee and timely files such documents.

2.3      Eligibility;   Commencement  of  Participation.  Provided  an  Employee
         selected to participate in the Plan has met all enrollment requirements
         set  forth  in this  Plan  and  required  by the  Committee,  including
         returning all required  documents to the Committee within the specified
         time period, that Employee shall commence  participation in the Plan on
         the first day of the Plan Year following the date on which the Employee
         completes  all  enrollment  requirements.  The  Committee  may allow an
         Employee who is first employed by an Employer to commence participation
         in the Plan during a Plan Year;  provided that the Employee is selected
         in  accordance  with  Section 2.1 and  satisfies  the  requirements  of
         Section  2.3 no later  than 30 days  after  the date he or she is first
         employed and provided  that no amount of  compensation  earned prior to
         the date of the  Committee's  receipt of his or her Plan  Agreement and
         Election Form may be deferred.

2.4      Termination  of  Participation  and/or  Deferrals.   If  the  Committee
         determines  in good faith that a Participant  no longer  qualifies as a
         member of a select group of management or highly compensated employees,
         as membership  in such group is determined in accordance  with Sections
         201(2),  301(a)(3) and 401(a)(1) of ERISA, the Committee shall have the
         right, in its sole discretion,  to (i) terminate any deferral  election
         the  Participant  has made for the  remainder of the Plan Year in which
         the  Participant's   membership   status  changes,   (ii)  prevent  the
         Participant   from  making  future  deferral   elections  and/or  (iii)
         immediately  distribute  the  Participant's  then Account  Balance as a
         Termination  Benefit and terminate the  Participant's  participation in
         the Plan.

                                    ARTICLE 3
  Deferral Commitments/Profit Sharing Restoration Contribution/Crediting/Taxes

3.1      Minimum Deferrals.

(a)               Base Annual Salary,  Annual  Discretionary Cash Bonus,  Annual
                  Cash Sharing,  and Annual  Commissions . For each Plan Year, a
                  Participant  may elect to defer, as his or her Annual Deferral
                  Amount, Base Annual Salary,  Annual  Discretionary Cash Bonus,
                  Annual Cash Sharing, and/or Annual Commissions in an aggregate
                  minimum of $2,000.

                  If an election is made for less than $2,000, if no election is
                  made or if no election can be made because the maximum  amount
                  that the  Participant may defer under Section 3.2 is less than
                  $2,000, the amount deferred shall be zero.

(b)               Short  Plan  Year.   Notwithstanding   the  foregoing,   if  a
                  Participant first becomes a Participant after the first day of

<PAGE>

                  a Plan Year, or in the case of the first Plan Year of the Plan
                  itself, the minimum Base Annual Salary,  Annual  Discretionary
                  Cash  Bonus,   Annual  Cash  Sharing  and  Annual  Commissions
                  deferral  shall be an amount  equal to the  minimums set forth
                  above,  respectively,  multiplied by a fraction, the numerator
                  of which is the number of  complete  months  remaining  in the
                  Plan Year and the denominator of which is 12.

3.2      Maximum Deferral.

(a)               Base Annual Salary,  Annual  Discretionary Cash Bonus,  Annual
                  Cash  Sharing and Annual  Commissions.  For each Plan Year,  a
                  Participant  may elect to defer, as his or her Annual Deferral
                  Amount, Base Annual Salary,  Annual  Discretionary Cash Bonus,
                  Annual  Cash  Sharing  and/or  Annual  Commissions  up to  the
                  following maximum percentages for each deferral elected:

                 --------------------------------- ---------------------------
                               Deferral                  Maximum Amount
                 --------------------------------- ---------------------------
                 --------------------------------- ---------------------------
                     Base Annual Salary                       50%
                 --------------------------------- ---------------------------
                 --------------------------------- ---------------------------
                     Annual Discretionary Cash                50%
                     Bonus
                 --------------------------------- ---------------------------
                 --------------------------------- ---------------------------
                     Annual Cash Sharing                      50%
                 --------------------------------- ---------------------------
                 --------------------------------- ---------------------------
                     Annual Commissions                       50%
                 --------------------------------- ---------------------------

                  Notwithstanding the foregoing,  if a Participant first becomes
                  a  Participant  after the first day of a Plan Year,  or in the
                  case of the first Plan Year of the Plan  itself,  the  maximum
                  Annual  Deferral  Amount,  with respect to Base Annual Salary,
                  Annual  Discretionary  Cash Bonus,  Annual Cash Sharing and/or
                  Annual  Commissions  shall be  limited to 50% of the amount of
                  such form of compensation not yet earned by the Participant as
                  of the date  the  Participant  submits  a Plan  Agreement  and
                  Election Form to the Committee for acceptance.  The Committee,
                  in its  discretion,  may adopt other deferral  limits that are
                  more  restrictive on Participants  than the foregoing  limits,
                  and the  Committee  may  provide  that  such  limits,  and the
                  Committee  may provide  that such other  limits shall apply to
                  Participants   generally   or   only  to   certain   specified
                  Participants.

3.3      Election to Defer; Effect of Election Form.

(a)               First  Plan  Year.   In   connection   with  a   Participant's
                  commencement  of  participation  in the Plan, the  Participant
                  shall make an irrevocable  deferral election for the Plan Year
                  in which the Participant commences  participation in the Plan,
                  along  with  such  other  elections  as  the  Committee  deems
                  necessary or desirable  under the Plan. For these elections to
                  be valid,  the Election  Form must be completed  and signed by
                  the  Participant,   timely  delivered  to  the  Committee  (in
                  accordance  with  Section  2.2  above)  and  accepted  by  the
                  Committee.

(b)               Subsequent  Plan  Years.  For each  succeeding  Plan Year,  an
                  irrevocable  deferral  election  for that Plan Year,  and such
                  other  elections as the Committee deems necessary or desirable
                  under the  Plan,  shall be made by  timely  delivering  to the

<PAGE>

                  Committee, in accordance with its rules and procedures, before
                  the end of the Plan Year preceding the Plan Year for which the
                  election is made, a new  Election  Form.  If no such  Election
                  Form is timely  delivered for a Plan Year, the Annual Deferral
                  Amount shall be zero for that Plan Year.

3.4      Withholding of Annual  Deferral  Amounts.  For each Plan Year, the Base
         Annual Salary portion of the Annual  Deferral  Amount shall be withheld
         from each  regularly  scheduled  Base  Annual  Salary  payroll in equal
         amounts,  as adjusted  from time to time for increases and decreases in
         Base Annual Salary. The Annual  Discretionary  Cash Bonus,  Annual Cash
         Sharing and Annual  Commissions  portion of the Annual  Deferral Amount
         shall be  withheld  at the time the Annual  Discretionary  Cash  Bonus,
         Annual Cash Sharing or Annual  Commissions,  as the case may be, are or
         otherwise would be paid to the Participant,  whether or not this occurs
         during the Plan Year itself.

3.5      Annual Company Contribution Amount. For each Plan Year, an Employer, in
         its sole discretion,  may, but is not required to, credit any amount it
         desires to any Participant's  Company  Contribution  Account under this
         Plan,  which amount shall be for that  Participant  the Annual  Company
         Contribution  Amount for that Plan Year.  The amount so  credited  to a
         Participant  may be smaller or larger  than the amount  credited to any
         other  Participant,  and the amount  credited to any  Participant for a
         Plan  Year may be zero,  even  though  one or more  other  Participants
         receive an Annual Company  Contribution  Amount for that Plan Year. The
         Annual Company Contribution Amount, if any, shall be credited as of the
         last day of the Plan  Year.  If a  Participant  is not  employed  by an
         Employer  as of the last day of a Plan Year other than by reason of his
         or  her  Retirement  or  death  while  employed,   the  Annual  Company
         Contribution Amount for that Plan Year shall be zero.

3.6      Annual Profit Sharing Restoration  Contribution Amount. A Participant's
         Annual Profit Sharing Restoration Contribution Amount for any Plan Year
         shall be equal to the  difference  between  (i) the amount of  employer
         matching  contributions  the  Participant  would  have  received  under
         section 3.3 of the Profit  Sharing Plan for the period under the Profit
         Sharing  Plan  that   corresponds   to  the  Plan  Year,  but  for  the
         Participant's deferral election under this Plan, and (ii) the amount of
         employer matching contributions the Participant actually received under
         section 3.3 of the Profit  Sharing Plan for the period under the Profit
         Sharing Plan that corresponds to the Plan Year. If a Participant is not
         employed by an Employer as of the last day of a Plan Year other than by
         reason of his or her  Retirement or death,  the Annual  Profit  Sharing
         Restoration  Contribution  Amount for such Plan Year shall be zero.  In
         the event of Retirement or death, a Participant  shall be credited with
         the Annual Profit Sharing Restoration  Contribution Amount for the Plan
         Year in which he or she  Retires  or dies.  Any Annual  Company  Profit
         Sharing  Restoration Amount, and amounts debited or credited thereon in
         accordance with Section 3.9, which has been forfeited under Section 3.8
         during a Plan Year  shall be  allocated  as of the last day of the Plan
         Year to the Company  Profit Sharing  Restoration  Accounts of the other
         eligible  Participants  in the Plan during that Plan Year in accordance
         with the  methodology  set forth in Section 3.10 of the Profit  Sharing
         Plan  as  interpreted  by  the  Committee  in  its  sole  and  absolute
         discretion.

3.7      Vesting.

(a)               A Participant shall at all times be 100% vested in his or her
                  Deferral Account.
<PAGE>

(b)               A   Participant   shall  be  vested  in  his  or  her  Company
                  Contribution    Account   and   Profit   Sharing   Restoration
                  Contribution   Account  in   accordance   with  the  following
                  schedule:

-----------------------------------------------------------------------------
       Years of Vesting Service                  Vested Percentage of
 on Date of Termination of Employment        Company Contribution Account
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
           Less than 1 year                               0%
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
  More than 1 but less than 2 years                       10%
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
  More than 2 but less than 3 years                       20%
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
  More than 3 but less than 4 years                       30%
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
  More than 4 but less than 5 years                       45%
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
  More than 5 but less than 6 years                       60%
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
  More than 6 but less than 7 years                       80%
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
           7 years or more                               100%
-----------------------------------------------------------------------------

(c)               Notwithstanding  anything to the  contrary  contained  in this
                  Section  3.8, in the event of the  Participant's  death,  or a
                  Change  in  Control,  a  Participant's   Company  Contribution
                  Account and Profit Sharing  Restoration  Contribution  Account
                  shall  immediately  become  100%  vested (if it is not already
                  vested in accordance with the above vesting schedules).

(d)               Notwithstanding  subsection  (c), the  vesting  schedule for a
                  Participant's  Company Contribution Account and Profit Sharing
                  Restoration  Contribution  Account shall not be accelerated to
                  the   extent   that   the   Committee   determines  that  such
                  acceleration would cause the deduction  limitations of Section
                  280G of the Code to become  effective.  In the event  that all
                  of a Participant's  Company   Contribution  Account  or Profit
                  Sharing   Restoration  Contribution  Account  is   not  vested
                  pursuant   to  such  a   determination,  the  Participant  may
                  request,  no later than 60 days after  the  date the Committee
                  notifies  the  Participant  in writing that his or her vesting
                  will  not  be  fully   accelerated   in  accordance  with  the
                  foregoing   sentence ,   independent  verification    of   the
                  Committee's calculations with  respect to the  application  of
                  Section  280G.  Such  request must  be made  in writing to the
                  Committee.  In such case,   the Committee  must provide to the
                  Participant  within 30  business days of its receipt of such a
                  request an opinion  from a  nationally   recognized accounting
                  firm selected by the  Participant   (the  "Accounting  Firm").
                  The  opinion  shall state the  Accounting  Firm's opinion that
                  any    limitation  in the  vested   percentage    hereunder is
                  necessary to avoid the limits  of   Section  280G  and contain
                  supporting   calculations,  and  the Participant's vesting (to
                  the extent not  previously  accelerated)  shall be accelerated
                  to the maximum  extent   possible  (within   the determination
                  made by the Accounting   Firm)  such  that  the limitations of
                  Section 280G of the  Code will not  be triggered.  The cost of
                  such opinion shall be paid for by the Company.

3.8      Crediting/Debiting of Account Balances. In accordance with, and subject
         to, the rules and procedures that are established  from time to time by

<PAGE>

         the  Committee,  in its sole  discretion,  amounts shall be credited or
         debited  to a  Participant's  Account  Balance in  accordance  with the
         following rules:

(a)               Election of Measurement  Funds. A Participant ,  in connection
                  with his or her initial deferral  election  in accordance with
                  Section 3.3(a) above,  shall elect, on  the Election Form, one
                  or more  Measurement  Fund(s) (as described  in Section 3.9(c)
                  below) to  be  used to  determine  the  additional  amounts to
                  be  credited  (or, in the  event of losses,  debited)   to his
                  or  her  Account   Balance  for the  first  calendar  month or
                  portion    thereof in   which   the    Participant   commences
                  participation   in the Plan and   continuing   thereafter  for
                  each  subsequent   calendar  month  in  which  the Participant
                  participates  in the Plan,  unless changed in accordance  with
                  the next sentence.  Commencing  with  the   first business day
                  that follows the  Participant's commencement of  participation
                  in the Plan  and  continuing   thereafter  for each subsequent
                  business day in which  the Participant  participates  in   the
                  Plan, the   Participant  may (but  is not  required to) elect,
                  by submitting  an   Election Form  to the   Committee  that is
                  accepted    by   the  Committee,  to add or delete one or more
                  Measurement Fund(s) to be  used to  determine  the  additional
                  amounts  to be  credited   (or,   in  the  event  of   losses,
                  debited)  to his or her Account   Balance,  or  to  change the
                  portion of his or  her Account   Balance   allocated  to  each
                  previously or newly elected   Measurement Fund. If an election
                  is made in accordance  with the  previous  sentence,  it shall
                  apply to the next  business  day and  continue thereafter  for
                  each  subsequent day in  which the   Participant  participates
                  in the Plan,  unless  changed in  accordance with the previous
                  sentence.

(b)               Proportionate  Allocation. In making any election described in
                  Section  3.9(a) above,  the  Participant  shall specify on the
                  Election Form, in increments of five  percentage  points (5%),
                  the  percentage of his or her Account  Balance to be deemed to
                  be invested in a particular  Measurement  Fund for purposes of
                  crediting  deemed  earnings (or losses) with respect to his or
                  her Account  Balance.  A  Participant's  elections shall total
                  100%.

(c)               Measurement  Funds.  The Participant may elect one (1) or more
                  of the  measurement  funds,  based  on  certain  mutual  funds
                  approved from time to time by the Committee (the  "Measurement
                  Funds"),  for the purpose of crediting  additional  amounts to
                  his or her Account Balance.  As necessary,  the Committee may,
                  in  its  sole  discretion,  discontinue,  substitute  or add a
                  Measurement  Fund. Each such action will take effect as of the
                  first business day that follows by thirty (30) days the day on
                  which the Committee gives Participants  advance written notice
                  of such change.

(d)               Crediting or Debiting   Method.   The   performance   of  each
                  elected Measurement  Fund  (either  positive or negative) will
                  be determined by the Committee,  in its reasonable discretion,
                  based on the actual performance of the selected  mutual  funds
                  corresponding   to  the  Measurement  Funds. A   Participant's
                  Account   Balance  shall  be  credited or  debited  on a daily
                  basis based on  the  performance   of  each  Measurement  Fund
                  selected   by   the   Participant,  as  determined    by   the
                  Committee   in  its  sole  discretion,   as  though   (i)    a
                  Participant's   Account    Balance   were   invested  in   the
                  Measurement Fund(s) selected by  the   Participant,   in   the
                  percentages    applicable  to  such  calendar   month,  as  of
                  the close of usiness  on  the  first   business  day  of  such

<PAGE>

                  calendar  month,   at the closing price on such date; (ii) the
                  portion of the Annual   Deferral   Amount  that  was  actually
                  deferred during any calendar   month  were   invested  in  the
                  Measurement  Fund(s)  selected  by  the   Participant,  in the
                  percentages  applicable to such  calendar   month,   no  later
                  than the close of business  on  the first  business  day after
                  the day on which such  amounts  are  actually   deferred  from
                  the  Participant's Base Annual Salary   through  reductions in
                  his or  her  payroll,  at the  closing  price  on  such  date;
                  and (iii)  any   distribution   made  to  a  Participant  that
                  decreases  such  Participant's  Account  Balance  ceased being
                  invested  in  the  Measurement  Fund(s),  in  the  percentages
                  applicable  to  such  calendar  month,  no  earlier  than  one
                  business day prior to the  distribution,  at the closing price
                  on   such   date.   The    Participant's     Annual    Company
                  Contribution  Amount  and Annual Profit  Sharing   Restoration
                  Contribution Amount  shall  be  credited to his or her Company
                  Contribution     Account   or   Profit   Sharing   Restoration
                  Contribution Account, as the case may be, for purposes of this
                  Section 3.9(d)  as  of  the  close  of  business  on  the last
                  business day of the Plan Year to which it relates.

(e)               No Actual  Investment.  Notwithstanding   any other  provision
                  of this Plan that may be  interpreted   to the  contrary,  the
                  Measurement Funds are to be used for measurement purposes only
                  and a Participant's election  of  any such  Measurement  Fund,
                  the deemed  allocation  to his or her Account Balance thereto,
                  the calculation of additional  amounts  and  the  crediting or
                  debiting of such amounts  to a Participant's  Account  Balance
                  shall not be  considered  or construed  in  any  manner  as an
                  actual investment  of his or her  Account  Balance in any such
                  Measurement   Fund.  In   the event that  the  Company  or the
                  Trustee (as that term is defined in the T rust),  in  its  own
                  discretion,  decides to invest funds  in  any  or  all  of the
                  Measurement  Funds,  no Participant  shall have any rights  in
                  or to such  investments.  Without  limiting  the foregoing,  a
                  Participant's   Account  Balance  shall  at  all  times  be  a
                  bookkeeping  entry only and shall not represent any investment
                  made on his or her behalf by the  Company  or the  Trust;  the
                  Participant  shall at all times  remain an  unsecured  general
                  creditor of the Company.

3.9      FICA and Other Taxes.

(a)               Annual Deferral Amounts. For each Plan Year in which an Annual
                  Deferral  Amount is being  withheld  from a  Participant,  the
                  Participant's  Employer(s) shall withhold from that portion of
                  the  Participant's  Base Annual Salary,  Annual  Discretionary
                  Cash Bonus, Annual Cash Sharing and Annual Commissions that is
                  not being deferred, in a manner determined by the Employer(s),
                  the Participant's  share of FICA and other employment taxes on
                  such Annual Deferral Amount.  If necessary,  the Committee may
                  reduce  the  Annual  Deferral  Amount  otherwise  elected by a
                  Participant in order to comply with this Section 3.10.

(b)               Annual Company  Contribution Amounts and Annual Profit Sharing
                  Restoration  Contribution  Amounts.  For  each  Plan  Year  in
                  which  an  Annual  Company   Contribution   Amount  or  Profit
                  Sharing    Restoration   Contribution    Amount   vests,   the
                  Participant's  Employer(s) shall withhold from that portion of
                  the Participant's Base Annual  Salary,   Annual  Discretionary
                  Cash Bonus, Annual Cash Sharing  and  Annual Commissions  that
                  is  not  being  deferred,  in a  manner   determined   by  the
                  Employer(s),   the  Participant's  share  of  FICA  and  other

<PAGE>

                  employment taxes  on  such Annual Company  Contribution Amount
                  and  Annual  Profit  Sharing  Restoration Contribution  Amount
                  and  all  earnings  thereon.  If necessary,  the Committee may
                  reduce a Participant's   Annual Company Contribution Amount or
                  Annual Profit Sharing  Restoration Contribution Amount or both
                  in order to comply with this Section 3.10.

(c)               Distributions.  The Participant's Employer(s),  or the trustee
                  of the Trust, shall withhold from any amount otherwise payable
                  to a Participant under this Plan all federal,  state and local
                  income,  employment and other taxes required to be withheld by
                  the  Employer(s),  or the trustee of the Trust,  in connection
                  with  such  payments,  in  amounts  and  in  a  manner  to  be
                  determined in the sole  discretion of the  Employer(s) and the
                  trustee of the Trust.

                                    ARTICLE 4
                     Short-Term Payout; Withdrawal Election

4.1      Short-Term  Payout. In connection with each election to defer an Annual
         Deferral  Amount,  a  Participant  may  irrevocably  elect to receive a
         future  "Short-Term  Payout"  from the Plan with respect to such Annual
         Deferral Amount.  Subject to the Deduction  Limitation,  the Short-Term
         Payout  shall be a lump sum  payment in an amount  that is equal to the
         Annual Deferral  Amount plus amounts  credited or debited in the manner
         provided in Section 3.9 above on that  amount,  determined  at the time
         that the Short-Term  Payout becomes  payable (rather than the date of a
         Termination of Employment). Subject to the Deduction Limitation and the
         other terms and conditions of this Plan, each Short-Term Payout elected
         shall be paid out during a 45 day period  commencing  immediately after
         the last day of any Plan Year designated by the Participant  that is at
         least three Plan Years after the Plan Year in which the Annual Deferral
         Amount  is  actually  deferred.  By way of  example,  if a  three  year
         Short-Term  Payout is elected  for  Annual  Deferral  Amounts  that are
         deferred  in the Plan Year  commencing  March 1,  2000,  the three year
         Short-Term  Payout  would  become  payable  during  the 45  day  period
         commencing December 1, 2004.

4.2      Other Benefits Take Precedence Over  Short-Term.  Should an event occur
         that triggers a benefit under Article 5, 6, 7 or 8, any Annual Deferral
         Amount, plus amounts credited or debited thereon,  that is subject to a
         Short-Term  Payout  election  under  Section  4.1  shall not be paid in
         accordance  with Section 4.1 but shall be paid in  accordance  with the
         other applicable Article.

4.3      Withdrawal  Election.  A Participant (or, after a Participant's  death,
         his or her  Beneficiary) may elect, at any time, to withdraw all of his
         or  her  Account  Balance,  calculated  as  if  there  had  occurred  a
         Termination  of  Employment  as of  the  day of  the  election,  less a
         withdrawal penalty equal to 10% of such amount (the net amount shall be
         referred to as the "Withdrawal  Amount").  This election can be made at
         any time, before or after Retirement,  Disability, death or Termination
         of Employment,  and whether or not the Participant (or  Beneficiary) is
         in the  process  of  being  paid  pursuant  to an  installment  payment
         schedule.   If  made  before   Retirement,   Disability  or  death,   a
         Participant's  Withdrawal  Amount  shall be his or her Account  Balance
         calculated as if there had occurred a  Termination  of Employment as of
         the day of the  election.  No partial  withdrawals  of a  Participant's
         Account  Balance  shall  be  allowed.  The  Participant  (or his or her
         Beneficiary)  shall make this election by giving the Committee  advance
         written notice of the election in a form  determined  from time to time
         by the Committee.  The Participant (or his or her Beneficiary) shall be

<PAGE>

         paid the Withdrawal Amount within 45 days of his or her election.  Once
         the Withdrawal Amount is paid, the  Participant's  participation in the
         Plan shall  terminate  and the  Participant  shall not be  eligible  to
         participate in the Plan for the remainder of the Plan Year in which the
         withdrawal election is made and the next full Plan Year. The payment of
         this   Withdrawal   Amount  shall  not  be  subject  to  the  Deduction
         Limitation.  The amount of the withdrawal  penalty shall be permanently
         and irrevocably forfeited by the Participant.

                                    ARTICLE 5
                               Retirement Benefit

5.1      Retirement   Benefit.      Subject  to  the  Deduction   Limitation,  a
         Participant who Retires shall receive,  as a Retirement Benefit, his or
         her Account Balance.

5.2      Payment of Retirement Benefit. A Participant, in connection with his or
         her  commencement  of  participation  in the  Plan,  shall  elect on an
         Election  Form to  receive  the  Retirement  Benefit  in a lump  sum or
         pursuant  to an Annual  Installment  Method  of 5, 10 or 15 years.  The
         Participant  may  annually  change his or her  election to an allowable
         alternative  payout  period by  submitting a new  Election  Form to the
         Committee, provided that an Election Form must be received and accepted
         by the Committee at least 1 year prior to the Participant's  Retirement
         in order to be effective with respect to a change of the  Participant's
         alternative  payout period. The Election Form most recently accepted by
         the Committee shall govern the payout of the Retirement  Benefit.  If a
         Participant  does not make any election  with respect to the payment of
         the  Retirement  Benefit,  then such benefit shall be payable in a lump
         sum. The lump sum payment shall be made, or installment  payments shall
         commence,  no later than 45 days after the last day of the Plan Year in
         which the Participant Retires. Any payment made shall be subject to the
         Deduction Limitation.

5.3      Death Prior to Completion of Retirement  Benefit. If a Participant dies
         after Retirement but before the Retirement Benefit is paid in full, the
         Participant's  unpaid  Retirement  Benefit  payments shall continue and
         shall be paid to the  Participant's  Beneficiary  in a lump sum that is
         equal to the Participant's unpaid remaining Account Balance.

                                    ARTICLE 6
                         Pre-Retirement Survivor Benefit

6.1      Pre-Retirement  Survivor Benefit.  Subject to the Deduction Limitation,
         the Participant's  Beneficiary shall receive a Pre-Retirement  Survivor
         Benefit equal to the  Participant's  Account Balance if the Participant
         dies before he or she Retires,  experiences a Termination of Employment
         or suffers a Disability.

6.2      Payment of Pre-Retirement Survivor Benefit. The Pre-Retirement Survivor
         Benefit shall be paid in a lump sum. The lump sum payment shall be made
         no later  than 45 days after the last day of the Plan Year in which the
         Committee is provided with proof that is  satisfactory to the Committee
         of the  Participant's  death.  Any payment made shall be subject to the
         Deduction Limitation.
<PAGE>

                                    ARTICLE 7
                               Termination Benefit

7.1      Termination  Benefit.   Subject  to  the  Deduction   Limitation,   the
         Participant shall receive a Termination  Benefit,  which shall be equal
         to the  Participant's  Account  Balance if a Participant  experiences a
         Termination  of  Employment  prior to his or her  Retirement,  death or
         Disability.

7.2      Payment of Termination  Benefit.  The Termination Benefit shall be paid
         in a lump sum. The lump sum payment shall be made no later than 45 days
         after the date on which the Participant  experiences the Termination of
         Employment.  Any  payment  made  shall  be  subject  to  the  Deduction
         Limitation.

                                    ARTICLE 8
                          Disability Waiver and Benefit

8.1      Disability Waiver.

(a)               Waiver of Deferral.  A  Participant  who is  determined by the
                  Committee to be suffering  from a Disability  shall be excused
                  from  fulfilling  that portion of the Annual  Deferral  Amount
                  commitment  that would  otherwise  have been  withheld  from a
                  Participant's  Base Annual Salary,  Annual  Discretionary Cash
                  Bonus,  Annual Cash Sharing and/or Annual  Commissions for the
                  Plan  Year  during  which  the  Participant  first  suffers  a
                  Disability.  During the period of Disability,  the Participant
                  shall  not  be  allowed  to  make  any   additional   deferral
                  elections,  but will  continue to be  considered a Participant
                  for all other purposes of this Plan.

(b)               Return to Work. If a Participant returns to employment with an
                  Employer, after a Disability ceases, the Participant may elect
                  to defer an Annual Deferral Amount for the Plan Year following
                  his or her return to  employment or service and for every Plan
                  Year thereafter while a Participant in the Plan; provided such
                  deferral  elections are otherwise allowed and an Election Form
                  is timely  delivered to and accepted by the Committee for each
                  such election in accordance with Section 3.3 above.

8.2      Continued  Eligibility;  Disability Benefit. A Participant  suffering a
         Disability shall, solely for benefit purposes under this Plan, continue
         to be considered to be employed, and shall be eligible for the benefits
         provided for in Articles 4, 5, 6 or 7 in accordance with the provisions
         of those Articles.  Notwithstanding the above, the Committee shall have
         the right to, in its sole and absolute  discretion  and for purposes of
         this Plan only, and must in the case of a Participant  who is otherwise
         eligible  to  Retire,  deem  the  Participant  to  have  experienced  a
         Termination  of  Employment,  or in the  case of a  Participant  who is
         eligible to Retire,  to have Retired,  at any time (or in the case of a
         Participant who is eligible to Retire,  as soon as  practicable)  after
         such  Participant is determined to be suffering a Disability,  in which
         case the Participant shall receive a Disability Benefit equal to his or
         her  Account  Balance  at the  time of the  Committee's  determination;
         provided,  however,  that should the  Participant  otherwise  have been
         eligible to Retire,  he or she shall be paid in accordance with Article
         5. The Disability Benefit shall be paid in a lump sum within 45 days of
         the  Committee's  exercise  of such right.  Any  payment  made shall be
         subject to the Deduction Limitation.

<PAGE>

                                    ARTICLE 9
                             Beneficiary Designation

9.1      Beneficiary.  Each  Participant  shall have the right,  at any time, to
         designate  his  or  her  Beneficiary(ies)  (both  primary  as  well  as
         contingent)  to  receive  any  benefits  payable  under  the  Plan to a
         beneficiary upon the death of a Participant. The Beneficiary designated
         under this Plan may be the same as or  different  from the  Beneficiary
         designation   under  any  other  plan  of  an  Employer  in  which  the
         Participant participates.

9.2      Beneficiary  Designation;  Change; Spousal Consent. A Participant shall
         designate  his  or  her  Beneficiary  by  completing  and  signing  the
         Beneficiary  Designation Form, and returning it to the Committee or its
         designated  agent.  A  Participant  shall  have the  right to  change a
         Beneficiary  by  completing,  signing and otherwise  complying with the
         terms of the Beneficiary Designation Form and the Committee's rules and
         procedures,  as in effect from time to time. If the  Participant  names
         someone  other  than  his or her  spouse  as  his or her  sole  primary
         Beneficiary,   a  spousal  consent,  in  the  form  designated  by  the
         Committee,  must be signed by that Participant's spouse and returned to
         the  Committee.   Upon  the  acceptance  by  the  Committee  of  a  new
         Beneficiary  Designation Form, all Beneficiary  designations previously
         filed shall be canceled. The Committee shall be entitled to rely on the
         last Beneficiary Designation Form filed by the Participant and accepted
         by the Committee prior to his or her death.

9.3      Acknowledgment.   No   designation   or   change  in  designation  of a
         Beneficiary  shall be  effective   until  received and  acknowledged in
         writing by the Committee or its designated agent.

9.4      No  Beneficiary  Designation.  If a  Participant  fails to  designate a
         Beneficiary  as provided in Sections  9.1, 9.2 and 9.3 above or, if all
         designated  Beneficiaries  predecease  the  Participant or die prior to
         complete   distribution  of  the  Participant's   benefits,   then  the
         Participant's  designated  Beneficiary shall be deemed to be his or her
         surviving  spouse.  If the  Participant  has no surviving  spouse,  the
         benefits  remaining under the Plan to be paid to a Beneficiary shall be
         payable to the executor or personal representative of the Participant's
         estate.

9.5      Doubt  as to  Beneficiary.  If the  Committee  has any  doubt as to the
         proper  Beneficiary  to receive  payments  pursuant  to this Plan,  the
         Committee shall have the right, exercisable in its discretion, to cause
         the Participant's  Employer to withhold such payments until this matter
         is resolved to the Committee's satisfaction.

9.6      Discharge of  Obligations.  The payment of benefits under the Plan to a
         Beneficiary shall fully and completely  discharge all Employers and the
         Committee from all further  obligations under this Plan with respect to
         the Participant,  and that Participant's Plan Agreement shall terminate
         upon such full payment of benefits.
<PAGE>

                                   ARTICLE 10
                                Leave of Absence

10.1     Paid  Leave  of  Absence.   If  a  Participant  is  authorized  by  the
         Participant's  Employer  for any reason to take a paid leave of absence
         from the employment of the Employer,  the Participant shall continue to
         be considered  employed by the Employer and the Annual  Deferral Amount
         shall  continue  to be  withheld  during  such paid leave of absence in
         accordance with Section 3.3.

10.2     Unpaid  Leave  of  Absence.  If a  Participant  is  authorized  by  the
         Participant's  Employer  for any  reason  to take an  unpaid  leave  of
         absence from the  employment  of the  Employer,  the  Participant  will
         continue to be considered  employed by the Employer and the Participant
         shall be excused  from making  deferrals  until the earlier of the date
         the leave of  absence  expires  or the  Participant  returns  to a paid
         employment  status.  Upon such  expiration or return,  deferrals  shall
         resume  for  the  remaining  portion  of the  Plan  Year in  which  the
         expiration or return occurs,  based on the deferral  election,  if any,
         made for that Plan Year. If no election was made for that Plan Year, no
         deferral  shall be  withheld.  A  Participant  shall be  deemed to have
         terminated employment if he or she fails to timely return to the employ
         of the Employer.

                                   ARTICLE 11
                     Termination, Amendment or Modification

11.1     Termination.  Although each Employer  anticipates that it will continue
         the Plan for an indefinite  period of time,  there is no guarantee that
         any Employer  will  continue the Plan or will not terminate the Plan at
         any time in the future.  Accordingly,  each Employer reserves the right
         to discontinue its sponsorship of the Plan and/or to terminate the Plan
         at any time with respect to any or all of its  participating  Employees
         by action of its board of directors.  Upon the  termination of the Plan
         with  respect to any  Employer,  the Plan  Agreements  of the  affected
         Participants  who are employed by that  Employer  shall  terminate  and
         their  Account  Balances,  determined  as if  they  had  experienced  a
         Termination of Employment on the date of Plan  termination  or, if Plan
         termination occurs after the date upon which a Participant was eligible
         to Retire,  then with respect to that  Participant  as if he or she had
         Retired  on  the  date  of  Plan  termination,  shall  be  paid  to the
         Participants as follows:  Prior to a Change in Control,  if the Plan is
         terminated with respect to all of its  Participants,  an Employer shall
         have  the  right,  in its  sole  discretion,  and  notwithstanding  any
         elections made by the  Participant,  to pay such benefits in a lump sum
         or pursuant  to an Annual  Installment  Method of up to 15 years,  with
         amounts credited and debited during the installment  period as provided
         herein.  If the Plan is terminated with respect to less than all of its
         Participants,  an Employer  shall be required to pay such benefits in a
         lump sum. After a Change in Control,  the Employer shall be required to
         pay such benefits in a lump sum. The  termination of the Plan shall not
         adversely affect any Participant or Beneficiary who has become entitled
         to the  payment  of any  benefits  under  the  Plan  as of the  date of
         termination;  provided however,  that the Employer shall have the right
         to  accelerate  installment  payments  without a premium or  prepayment
         penalty by paying the  Account  Balance in a lump sum or pursuant to an
         Annual  Installment Method using fewer years (provided that the present
         value of all payments that will have been received by a Participant  at
         any given  point of time under the  different  payment  schedule  shall
         equal or exceed the present  value of all payments that would have been
         received at that point in time under the original payment schedule).

<PAGE>

11.2     Amendment.  Any Employer may, at any time,  amend or modify the Plan in
         whole or in part with  respect  to that  Employer  by the action of its
         board of directors;  provided,  however,  that:  (i) subject to Section
         11.9,  no amendment or  modification  shall be effective to decrease or
         restrict the value of a  Participant's  Account Balance in existence at
         the time the amendment or  modification  is made,  calculated as if the
         Participant  had  experienced  a  Termination  of  Employment as of the
         effective date of the amendment or modification or, if the amendment or
         modification  occurs  after the date upon  which  the  Participant  was
         eligible to Retire,  the  Participant  had Retired as of the  effective
         date  of the  amendment  or  modification,  and  (ii) no  amendment  or
         modification  of this Section 11.2 or Section 12.2 of the Plan shall be
         effective.  The amendment or  modification of the Plan shall not affect
         any  Participant or Beneficiary  who has become entitled to the payment
         of  benefits  under  the  Plan  as of  the  date  of the  amendment  or
         modification; provided, however, that the Employer shall have the right
         to accelerate  installment  payments by paying the Account Balance in a
         lump sum or pursuant to an Annual  Installment Method using fewer years
         (provided  that the present  value of all payments  that will have been
         received  by a  Participant  at any  given  point  of  time  under  the
         different  payment  schedule shall equal or exceed the present value of
         all payments  that would have been received at that point in time under
         the original payment schedule).

11.3     Plan Agreement. Despite the provisions of Sections 11.1 and 11.2 above,
         if a Participant's Plan Agreement contains benefits or limitations that
         are not in this Plan document, the Employer may only amend or terminate
         such provisions as to the Participant with his or her consent.

11.4     Effect of Payment.  The full payment of the  applicable  benefit  under
         Articles  4, 5, 6, 7 or 8 of the Plan shall  completely  discharge  all
         obligations to a Participant  and his or her  designated  Beneficiaries
         under this Plan and the Participant's Plan Agreement shall terminate.

                                   ARTICLE 12
                                 Administration

12.1     Committee Duties. Except as otherwise provided in this Article 12, this
         Plan shall be administered  by a Committee,  which shall consist of the
         Board,  or such  committee as the Board shall  appoint.  Members of the
         Committee  may be  Participants  under this Plan.  In  addition  to any
         powers  otherwise  conferred  under this Plan, the Committee shall have
         the discretion and authority to (i) make, amend, interpret, and enforce
         all appropriate  rules and regulations for the  administration  of this
         Plan  and  (ii)  decide  or  resolve  any and all  questions  including
         interpretations of this Plan, as may arise in connection with the Plan.
         Any individual  serving on the Committee who is a Participant shall not
         vote or act on any matter relating  solely to himself or herself.  When
         making a determination or calculation,  the Committee shall be entitled
         to rely on information furnished by a Participant or the Company.

12.2     Administration  Upon Change In Control.  For purposes of this Plan, the
         Company  shall  be  the  "Administrator"  at  all  times  prior  to the
         occurrence of a Change in Control.  Upon and after the  occurrence of a
         Change in Control,  the  "Administrator"  shall be an independent third
         party  selected  by the Trustee and  approved  by the  individual  who,
         immediately  prior to such event,  was the  Company's  Chief  Executive
         Officer or, if not so identified, the Company's highest ranking officer
         (the "Ex-CEO"). The Administrator shall have the discretionary power to
         determine all questions  arising in connection with the  administration
         of the Plan and the interpretation of the Plan and Trust including, but
         not limited to benefit entitlement  determinations;  provided, however,

<PAGE>

         upon and after the occurrence of a Change in Control, the Administrator
         shall have no power to direct the investment of Plan or Trust assets or
         select any investment  manager or custodial firm for the Plan or Trust.
         Upon and after the occurrence of a Change in Control, the Company must:
         (1)  pay  all  reasonable  administrative  expenses  and  fees  of  the
         Administrator;  (2)  indemnify  the  Administrator  against  any costs,
         expenses and liabilities including, without limitation, attorney's fees
         and  expenses  arising  in  connection  with  the  performance  of  the
         Administrator hereunder,  except with respect to matters resulting from
         the gross negligence or willful  misconduct of the Administrator or its
         employees or agents;  and (3) supply full and timely information to the
         Administrator  or all  matters  relating  to the Plan,  the Trust,  the
         Participants  and their  Beneficiaries,  the  Account  Balances  of the
         Participants, the date of circumstances of the Retirement,  Disability,
         death or Termination of Employment of the Participants,  and such other
         pertinent information as the Administrator may reasonably require. Upon
         and after a Change in Control, the Administrator may be terminated (and
         a  replacement  appointed) by the Trustee only with the approval of the
         Ex-CEO.  Upon and after a Change in Control,  the Administrator may not
         be terminated by the Company.

12.3     Agents.  In the  administration  of this Plan,  the Committee may, from
         time to time,  employ  agents and delegate to them such  administrative
         duties  as it sees  fit  (including  acting  through  a duly  appointed
         representative)  and may from time to time consult with counsel who may
         be counsel to any Employer.

12.4     Binding   Effect  of   Decisions.   The   decision  or  action  of  the
         Administrator  with  respect  to  any  question  arising  out  of or in
         connection with the  administration,  interpretation and application of
         the Plan and the rules and regulations  promulgated  hereunder shall be
         final and  conclusive  and binding upon all persons having any interest
         in the Plan.

12.5     Indemnity of Committee. All Employers shall indemnify and hold harmless
         the members of the  Committee,  any  Employee to whom the duties of the
         Committee may be delegated,  and the Administrator  against any and all
         claims,  losses,  damages,  expenses or  liabilities  arising  from any
         action or failure to act with respect to this Plan,  except in the case
         of willful  misconduct by the Committee,  any of its members,  any such
         Employee or the Administrator.

12.6     Employer  Information.  To enable the Committee and/or Administrator to
         perform its functions,  the Company and each Employer shall supply full
         and timely  information to the Committee and/or  Administrator,  as the
         case  may  be,  on all  matters  relating  to the  compensation  of its
         Participants, the date and circumstances of the Retirement, Disability,
         death  or  circumstances  of  the  Retirement,   Disability,  death  or
         Termination of Employment of its Participants, and such other pertinent
         information as the Committee or Administrator may reasonably require.

                                   ARTICLE 13
                          Other Benefits and Agreements

13.1     Coordination   with  Other  Benefits.   The  benefits  provided  for  a
         Participant  and  Participant's  Beneficiary  under  the  Plan  are  in
         addition to any other benefits  available to such Participant under any
         other plan or program for employees of the Participant's  Employer. The
         Plan  shall  supplement  and shall not  supersede,  modify or amend any
         other  such  plan or  program  except  as may  otherwise  be  expressly
         provided.

<PAGE>

                                   ARTICLE 14
                                Claims Procedures

14.1     Presentation  of Claim.  Any  Participant  or Beneficiary of a deceased
         Participant (such Participant or Beneficiary being referred to below as
         a  "Claimant")  may  deliver  to the  Committee  a written  claim for a
         determination  with  respect  to  the  amounts  distributable  to  such
         Claimant  from the Plan.  If such a claim  relates to the contents of a
         notice received by the Claimant,  the claim must be made within 60 days
         after such notice was received by the  Claimant.  All other claims must
         be made  within 180 days of the date on which the event that caused the
         claim to arise occurred.  The claim must state with  particularity  the
         determination desired by the Claimant.

14.2     Notification  of  Decision.  The  Committee shall consider a Claimant's
         claim within a reasonable  time,  and  shall  notify  the   Claimant in
         writing:

(a)               that the Claimant's requested determination has been made, and
                  that the claim has been allowed in full; or

(b)               that the Committee has reached a conclusion contrary, in whole
                  or in part, to the  Claimant's  requested  determination,  and
                  such  notice  must  set  forth in a  manner  calculated  to be
                  understood by the Claimant:

(i)      the specific reason(s) for the denial of the claim, or any part of it;

(ii)     specific  reference(s) to  pertinent provisions of the Plan upon  which
         such denial was based;

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

(iv)     an explanation of the claim review procedure set forth in Section 14.3
         below.

14.3     Review of a Denied Claim.  Within 60 days after receiving a notice from
         the  Committee  that a claim has been  denied,  in whole or in part,  a
         Claimant (or the Claimant's  duly authorized  representative)  may file
         with the Committee a written  request for a review of the denial of the
         claim.  Thereafter,  but  not  later  than  30 days  after  the  review
         procedure  began,  the  Claimant  (or the  Claimant's  duly  authorized
         representative):

(a)               may review pertinent documents;

(b)               may submit written comments or other documents; and/or

(c)               may request a hearing, which the Committee, in its sole
                  discretion, may grant.

14.4     Decision on Review.  The Committee  shall render its decision on review
         promptly,  and not later  than 60 days  after  the  filing of a written
         request  for  review of the  denial,  unless a hearing is held or other
         special  circumstances  require  additional  time,  in  which  case the
         Committee's  decision must be rendered within 120 days after such date.
         Such decision  must be written in a manner  calculated to be understood
         by the Claimant, and it must contain:
<PAGE>

(a)               specific reasons for the decision;

(b)               specific reference(s) to the pertinent Plan provisios  upon
                  which  the decision was based; and

(c)               such other matters as the Committee deems relevant.

14.5     Legal Action. A Claimant's  compliance with the foregoing provisions of
         this Article 14 is a mandatory  prerequisite  to a Claimant's  right to
         commence any legal action with respect to any claim for benefits  under
         this Plan.

                                   ARTICLE 15
                                      Trust

15.1     Establishment  of the Trust. The Company shall establish the Trust, and
         each Employer shall at least  annually  transfer over to the Trust such
         assets  as  the  Employer  determines,  in  its  sole  discretion,  are
         necessary  to provide,  on a present  value basis,  for its  respective
         future liabilities created with respect to the Annual Deferral Amounts,
         Annual  Company   Contribution   Amounts,   and  for  such   Employer's
         Participants  for all  periods  prior to the  transfer,  as well as any
         debits  and  credits  to the  Participants'  Account  Balances  for all
         periods prior to the transfer,  taking into  consideration the value of
         the assets in the trust at the time of the transfer.

15.2     Interrelationship of the Plan and the Trust. The provisions of the Plan
         and the Plan  Agreement  shall  govern the rights of a  Participant  to
         receive distributions pursuant to the Plan. The provisions of the Trust
         shall  govern  the  rights  of  the  Employers,  Participants  and  the
         creditors of the Employers to the assets transferred to the Trust. Each
         Employer shall at all times remain liable to carry out its  obligations
         under the Plan.

15.3     Distributions  From the Trust.  Each Employer's  obligations  under the
         Plan may be  satisfied  with Trust assets  distributed  pursuant to the
         terms  of the  Trust,  and  any  such  distribution  shall  reduce  the
         Employer's obligations under this Plan.

                                   ARTICLE 16
                                  Miscellaneous

16.1     Status of Plan. The Plan is intended to be a plan that is not qualified
         within the meaning of Code Section  401(a) and that "is unfunded and is
         maintained  by an  employer  primarily  for the  purpose  of  providing
         deferred  compensation  for a select  group  of  management  or  highly
         compensated  employee"  within the  meaning of ERISA  Sections  201(2),
         301(a)(3) and 401(a)(1). The Plan shall be administered and interpreted
         to the extent possible in a manner consistent with that intent.

16.2     Unsecured  General  Creditor.  Participants  and  their  Beneficiaries,
         heirs,  successors and assigns shall have no legal or equitable rights,
         interests  or claims in any  property  or  assets of an  Employer.  For
         purposes of the payment of benefits  under this Plan, any and all of an
         Employer's  assets  shall  be,  and  remain,  the  general,   unpledged
         unrestricted assets of the Employer. An Employer's obligation under the
         Plan shall be merely that of an unfunded and  unsecured  promise to pay
         money in the future.
<PAGE>

16.3     Employer's  Liability.  An  Employer's  liability  for the  payment  of
         benefits shall be defined only by the Plan and the Plan  Agreement,  as
         entered into between the Employer and a Participant.  An Employer shall
         have no obligation to a Participant  under the Plan except as expressly
         provided in the Plan and his or her Plan Agreement.

16.4     Nonassignability. Neither a Participant nor any other person shall have
         any right to  commute,  sell,  assign,  transfer,  pledge,  anticipate,
         mortgage or  otherwise  encumber,  transfer,  hypothecate,  alienate or
         convey in advance  of actual  receipt,  the  amounts,  if any,  payable
         hereunder,  or any part thereof, which are, and all rights to which are
         expressly declared to be, unassignable and non-transferable. No part of
         the  amounts  payable  shall,  prior to actual  payment,  be subject to
         seizure,  attachment,  garnishment or sequestration  for the payment of
         any  debts,  judgments,  alimony  or  separate  maintenance  owed  by a
         Participant or any other person, be transferable by operation of law in
         the  event of a  Participant's  or any  other  person's  bankruptcy  or
         insolvency  or be  transferable  to a spouse as a result of a  property
         settlement or otherwise.

16.5     Not a Contract of  Employment.  The terms and  conditions  of this Plan
         shall not be deemed to constitute a contract of employment  between any
         Employer and the Participant. Such employment is hereby acknowledged to
         be an "at will" employment  relationship  that can be terminated at any
         time for any reason,  or no reason,  with or without cause, and with or
         without  notice,  unless  expressly  provided  in a written  employment
         agreement.  Nothing in this Plan shall be deemed to give a  Participant
         the right to be retained in the service of any Employer as an Employee,
         or to  interfere  with  the  right of any  Employer  to  discipline  or
         discharge the Participant at any time.

16.6     Furnishing  Information.  A Participant or his or her Beneficiary  will
         cooperate  with the  Committee by  furnishing  any and all  information
         requested  by the  Committee  and take  such  other  actions  as may be
         requested in order to facilitate the administration of the Plan and the
         payments of  benefits  hereunder,  including  but not limited to taking
         such physical examinations as the Committee may deem necessary.

16.7     Terms. Whenever any words are used herein in the masculine,  they shall
         be  construed  as though  they were in the  feminine in all cases where
         they  would so apply;  and  whenever  any words are used  herein in the
         singular or in the plural,  they shall be construed as though they were
         used in the  plural or the  singular,  as the case may be, in all cases
         where they would so apply.

16.8     Captions. The captions of the articles, sections and paragraphs of this
         Plan are for  convenience  only and shall  not  control  or affect  the
         meaning or construction of any of its provisions.

16.9     Governing Law. Subject to ERISA,   the provisions of this Plan shall be
         construed and interpreted  according to the internal laws  of the State
         of Nevada without regard to its conflicts of laws principles.

16.10    Notice.  Any notice or filing  required or permitted to be given to the
         Committee  under  this  Plan  shall be  sufficient  if in  writing  and
         hand-delivered, or sent by registered or certified mail, to the address
         below:
<PAGE>

                                   Deferred Compensation Plan
                                   Administrative Committee
                                   -----------------------------------------
                                   -----------------------------------------
                                   International Game Technology
                                   -----------------------------------------
                                   -----------------------------------------
                                   9295 Prototype Drive
                                   Reno, Nevada 89511-8986
                                   -----------------------------------------

         Such notice  shall be deemed  given as of the date of  delivery  or, if
         delivery is made by mail,  as of the date shown on the  postmark on the
         receipt for registration or certification.

         Any notice or filing required or permitted to be given to a Participant
         under this Plan shall be sufficient  if in writing and  hand-delivered,
         or sent by mail, to the last known address of the Participant.

16.11    Successors.  The  provisions  of this Plan  shall bind and inure to the
         benefit of the  Participant's  Employer and its  successors and assigns
         and the Participant and the Participant's designated Beneficiaries.

16.12    Spouse's  Interest.  The interest in the benefits hereunder of a spouse
         of  a  Participant   who  has   predeceased   the   Participant   shall
         automatically  pass to the Participant and shall not be transferable by
         such spouse in any manner,  including  but not limited to such spouse's
         will,  nor  shall  such  interest  pass  under  the  laws of  intestate
         succession.

16.13    Validity.  In case any  provision  of this  Plan  shall be  illegal  or
         invalid for any reason,  said illegality or invalidity shall not affect
         the  remaining  parts  hereof,  but this Plan  shall be  construed  and
         enforced  as if such  illegal  or  invalid  provision  had  never  been
         inserted herein.

16.14    Incompetent.  If the  Committee  determines  in its  discretion  that a
         benefit  under  this Plan is to be paid to a minor,  a person  declared
         incompetent  or to a person  incapable of handling the  disposition  of
         that  person's  property,  the  Committee  may  direct  payment of such
         benefit to the guardian, legal representative or person having the care
         and  custody  of such  minor,  incompetent  or  incapable  person.  The
         Committee  may require proof of minority,  incompetence,  incapacity or
         guardianship,  as it may deem appropriate  prior to distribution of the
         benefit. Any payment of a benefit shall be a payment for the account of
         the Participant and the Participant's Beneficiary,  as the case may be,
         and shall be a complete  discharge of any liability  under the Plan for
         such payment amount.

16.15    Court Order. The Committee is authorized to make any payments  directed
         by court  order in any  action in which the Plan or the  Committee  has
         been named as a party. In addition, if a court determines that a spouse
         or former spouse of a Participant has an interest in the  Participant's
         benefits  under the Plan in  connection  with a property  settlement or
         otherwise, the Committee, in its sole discretion, shall have the right,
         notwithstanding  any election  made by a  Participant,  to  immediately
         distribute   the   spouse's   or  former   spouse's   interest  in  the
         Participant's benefits under the Plan to that spouse or former spouse.
<PAGE>

16.16    Distribution in the Event of Taxation.

(a)               In General.  If, for any reason,  all  or  any  portion  of  a
                  Participant's benefits  under this Plan becomes taxable to the
                  Participant  prior to receipt, a Participant  may petition the
                  Committee  before a Change in Control,  or the  trustee of the
                  Trust after a Change in Control,  for a distribution  of  that
                  portion of his or her benefit  that has become  taxable.  Upon
                  the grant of such a petition, by the   Committee  in  its sole
                  discretion,  a  Participant's  Employer  shall  distribute  to
                  the Participant   immediately   available   funds in an amount
                  equal to the taxable portion of his or  her   benefit   (which
                  amount shall not  exceed   a   Participant's   unpaid  Account
                  Balance under the Plan). If the petition is granted,   the tax
                  liability  distribution   shall  be made within 90 days of the
                  date when the Participant's   petition  is  granted.    Such a
                  distribution  shall  affect and reduce the benefits to be paid
                  under this Plan.

(b)               Trust.  If the Trust  terminates  in  accordance  with Section
                  3.6(e) of the  Trust and  benefits  are  distributed  from the
                  Trust to a Participant  in accordance  with that Section,  the
                  Participant's benefits under this Plan shall be reduced to the
                  extent of such distributions.

16.17    Insurance.  The  Employers,  on their  own  behalf  or on behalf of the
         trustee of the Trust, and, in their sole discretion,  may apply for and
         procure  insurance on the life of the Participant,  in such amounts and
         in such forms as the Trust may choose.  The Employers or the trustee of
         the Trust,  as the case may be, shall be the sole owner and beneficiary
         of  any  such  insurance.   The  Participant  shall  have  no  interest
         whatsoever  in any such policy or  policies,  and at the request of the
         Employers  shall  submit  to  medical   examinations  and  supply  such
         information  and  execute  such  documents  as may be  required  by the
         insurance  company or companies to whom the Employers  have applied for
         insurance.

16.18    Legal Fees To Enforce  Rights After Change in Control.  The Company and
         each Employer is aware that upon the occurrence of a Change in Control,
         the Board or the board of directors of a Participant's  Employer (which
         might then be composed of new members) or a shareholder  of the Company
         or the Participant's  Employer,  or of any successor  corporation might
         then cause or attempt to cause the Company, the Participant's  Employer
         or such  successor to refuse to comply with its  obligations  under the
         Plan  and  might   cause  or  attempt  to  cause  the  Company  or  the
         Participant's  Employer  to  institute,  or may  institute,  litigation
         seeking to deny  Participants the benefits  intended under the Plan. In
         these  circumstances,  the  purpose  of the Plan  could be  frustrated.
         Accordingly, if, following a Change in Control, it should appear to any
         Participant  that  the  Company,  the  Participant's  Employer  or  any
         successor  corporation has failed to comply with any of its obligations
         under the Plan or any  agreement  thereunder  or, if the Company,  such
         Employer or any other  person takes any action to declare the Plan void
         or  unenforceable  or institutes  any  litigation or other legal action
         designed  to deny,  diminish  or to recover  from any  Participant  the
         benefits   intended   to  be   provided,   then  the  Company  and  the
         Participant's Employer irrevocably authorize such Participant to retain
         counsel of his or her  choice at the  expense  of the  Company  and the
         Participant's  Employer (who shall be jointly and severally  liable) to
         represent such Participant in connection with the initiation or defense
         of any  litigation  or other  legal  action,  whether by or against the
         Company,   the  Participant's   Employer  or  any  director,   officer,
         shareholder  or  other  person   affiliated   with  the  Company,   the
         Participant's Employer or any successor thereto in any jurisdiction.

<PAGE>

IN WITNESS WHEREOF,  the Company has signed this Plan document as of __________,
1999.

   "Company"

                    International Game Technology, a Nevada corporation

                    By: __________________________________

                    Title: _______________________________EMPLOYMENT AGREEMENT

                   THIS  AGREEMENT  ("Agreement")  is dated as of December  6,
2000, and is by and between IGT (the "Company"), and G. Thomas Baker
("Executive").

                   WHEREAS, Executive is currently employed by Company; and

                   WHEREAS,  the Company  considers it important and in its best
interest to foster the  employment  of key  management  personnel and desires to
retain the services of Executive on the terms and subject to the  conditions  in
this Agreement; and

                   WHEREAS,  the Executive desires to continue employment by the
Company  to render  services  to the  Company  on the terms and  subject  to the
conditions in this Agreement.

                   NOW,  THEREFORE,  in  consideration  of the  premises and the
respective  undertakings  of the  Company and  Executive  set forth  below,  the
Company and Executive agree as follows:

          1. Employment. The Company hereby employs Executive in the position of
President and Chief Executive Officer, and Executive accepts such employment and
agrees to perform  services for the  Company,  for the period and upon the other
terms and conditions set forth in this Agreement.

          2. Term. The term of Executive's  employment pursuant to this contract
shall be for a period  of three  (3)  years,  commencing  on  December  6,  2000
(Commencement Date) to and including December 5, 2003, unless earlier terminated
as provided in this Agreement (the "Term").

          3.  Compensation.
              ------------

                   3.1 Base Salary.  As compensation in full for the services to
be rendered by the Executive  under this Agreement  during the Term, the Company
shall pay to Executive a base salary of $650,000 for year one,  $700,000  during
year two and $750,000 during year three (the "Base  Salary"),  which Base Salary
shall be paid in accordance  with the Company's  normal  payroll  procedures and
policies.

                   3.2 Bonus For each one percent increase in operating  profits
before  incentives  over the  previous  fiscal year,  Executive  will receive 10
percent  of his base  salary.  Executive  shall  receive  20 percent of his base
salary  for any  increase  over prior  year in excess of 10  percent.  The bonus
calculation  shall have a maximum of 300 percent of the base salary. In year one
of the Term,  the bonus  shall be paid based on the full  2000-2001  fiscal year
without proration.  The bonus will also be payable based upon various management
objectives set by the Board of Directors in consultation with Executive.  If the
bonuses  earned in year one and year two of the Term exceeds 200 percent of base
pay,  the amount over 200 percent  will be accrued  and  payment  deferred  (the
"Deferred  Bonus")  to year  three of the  Term if  Executive  remains  with the
Company through the Term.  Deferred Bonus for years one and two, if any, will be
paid in conjunction with the bonus earned in year three.

<PAGE>

                   3.3  Participation in Benefit Plans.  Executive shall also be
entitled to participate in all employee benefit plans or programs of the Company
to the extent that his position,  title,  tenure,  salary, age, health and other
qualifications make him eligible to participate.  The Company does not guarantee
the adoption or continuance of any particular  employee  benefit plan or program
during the Term, and Executive's participation in any such plan or program shall
be subject to the provisions, rules and regulations applicable thereto.

                   3.4 Stock Option. Concurrent with the date of this Agreement,
the Company  shall grant to  Executive an option to purchase  500,000  shares of
common stock of the Company,  in accordance with the provisions of the Company's
1993 Stock Option Plan (the "Stock  Option")  except that the Stock Option shall
vest one third at the  Commencement  Date of each year  beginning on December 5,
2001.  Therefore  166,667options shall vest on December 5, 2001; 166,667 options
shall vest on  December 5, 2002 and  166,666  options  shall vest on December 5,
2002. The strike price shall be set as of December 5, 2000.

                   3.5  Withholding  Taxes.  The Company may  withhold  from any
benefits payable under this Agreement,  all federal,  state, city or other taxes
as  shall  be  required  to be  withheld  pursuant  to any  law or  governmental
regulation or ruling.

          4.  Confidential  Information.  Except as permitted or directed by the
Company's  Board  of  Directors  or  required  by an  order  of a  court  having
jurisdiction or under subpoena from an appropriate government agency, during the
Term or at any time  thereafter  Executive  shall not  divulge,  furnish or make
accessible to anyone or use in any way (other than in the ordinary course of the
business the Company or any of its respective  affiliates)  any  confidential or
secret  knowledge or information of the Company which  Executive has acquired or
become  acquainted  with or will acquire or become  acquainted with prior to the
termination of the period of his employment by the Company (including employment
by the Company or any affiliated or predecessor  companies  prior to the date of
this Agreement), whether developed by himself or by others, concerning any trade
secrets, confidential or secret designs, processes,  formulae, plans, devices or
material  (whether or not patented or patentable)  directly or indirectly useful
in any aspect of the business of the Company,  any customer or supplier lists of
the Company,  any  confidential  or secret  development  or research work of the
Company, or any other confidential information or secret aspects of the business
of the Company.  Executive  acknowledges that the  above-described  knowledge or
information  constitutes  a  unique  and  valuable  asset  of  the  Company  and
represents a substantial investment of time and expense by the Company, and that
any disclosure or other use of such knowledge or information  other than for the
sole benefit of the Company and its affiliates would be wrongful and would cause
irreparable harm to the Company. Both during and after the Term, Executive shall
refrain from any acts or omissions that would reduce the value of such knowledge
or information  to the Company.  The foregoing  obligations of  confidentiality,
however,  shall not apply to any knowledge or information which is now published
or which  subsequently  becomes generally publicly known, other than as a direct
or indirect result of the breach of this Agreement by Executive.

          5.  Ventures.  If,  during  the  Term,  Executive  is  engaged  in  or
associated with the planning or implementing of any project,  program or venture
involving  the Company and a third party or parties,  all rights with respect to
such project, program or venture shall belong to the Company. Except as approved
by the  Company's  Board of  Directors,  Executive  shall not be entitled to any
interest in such project, program or venture or to any commission,  finder's fee
or other  compensation in connection  therewith other than the salary to be paid
to Executive as provided in this Agreement.

<PAGE>

          6.  Noncompetition Covenant.
              -----------------------

                   6.1  Agreement not to Compete.  Executive  agrees that during
the Term of this Agreement,  Executive shall not, without the written consent of
the Company's Board of Directors,  directly or indirectly, engage in competition
with the Company in any manner or  capacity  (e.g.,  as an  advisor,  principal,
agent,  partner,  officer,  director,  stockholder,   employee,  member  of  any
association,  or  otherwise)  in any phase of the business  which the Company is
conducting  during the Term,  including  the design,  development,  manufacture,
distribution,  marketing, leasing, financing or selling of accessories, devices,
or systems related to the products or services being sold by the Company.

                   6.2  Geographic  Extent  of  Covenant.   The  obligations  of
Executive  under  Section  6.1 shall apply to any  geographic  area in which the
Company has engaged in business during the Term.

                   6.3  Non-Solicitation. Executive agrees that during the  Term
and for a period of 12 months thereafter, he will not, without the prior written
approval  of the  Company's  Board of  Directors,  hire,  solicit or endeavor to
entice  away  from  the  Company  or,   following   termination  of  Executive's
employment,  otherwise  interfere with the  relationship of the Company with any
management  employee of the Company, or any person or entity who was, within the
then most recent prior 12-month  period,  a customer,  supplier or contractor of
the Company or any of its affiliates.

                   7. Termination. This vAgreement shall terminate in accordance
 with the following provisions:

                   7.1  Expiration  of the Term.  Unless  earlier  terminated in
accordance  with the  provisions  hereof,  this Agreement  shall  terminate upon
expiration of the three year Term as provided in Section 2. After the expiration
of the Term, the Board of Directors may continue the employment of Executive and
Executive may accept the employment on an at will basis.  Company also agrees to
provide  Executive with medical  coverage for Executive only  (excluding  family
members) through the Company or through some other mutually agreed upon provider
for the  remainder  of his life.  If such  health  insurance  is  provided  by a
provider  other than the  Company's,  the  insurance  shall  provide for similar
coverage as is received by Executives of the Company.

                    7.2 Death.  If the  Executive  dies  during  the Term,  this
Agreement  shall  terminate,  with the  Termination  Date  being the date of the
Executive's death.

                    7.3  Disability.  If the  Executive  has  been  absent  from
service to the Company as required in this Agreement for a period of ninety (90)
days or more during any one-hundred eighty (180) day period during the Term as a
result  of any  physical  or mental  disability,  the  Company  has the right to
terminate this Agreement,  the Termination  Date being ten (1) days after notice
thereof  is given to  Executive.  Upon such  disability  during  the  Term,  the
severance  provided  for in

<PAGE>

paragraph 7.5 below shall be paid to Executive's estate or as he shall direct.

                   7.4  Termination  by Company for Cause.  The  Company has the
right to terminate this Agreement for Cause as defined herein,  such termination
to be effective  immediately  upon notice thereof from the Company to Executive.
For purposes of this Agreement, "Cause" shall mean:

|X|      The   willful   and   material   failure  of Executive  to perform  him
         duties  hereunder   (other   than  any  such   failure   due  to
         Executive's physical or mental illness),  or the willful and material
         breach by Executive of his obligations hereunder;

|X|      Executive engaging in willful and serious misconduct that has caused or
         is reasonably expected to result in material injury to the Company;

|X|      Executive is convicted of,or enters a plea of guilty or nolo contendre,
         to a crime that constitutes a felony;

|X|      The failure or  inability  of  Executive  to obtain or retain any
         license  required to be obtained   or   retained   by   him  in  any
         jurisdiction  in which the  Company  does or proposes to do business.

                   7.5  Termination  by   Company  Without  Cause.  If  at  any
time the Board of  Directors  of the Company  decide  terminate  this  Agreement
during the Term, it may do so under the following terms and conditions:

o                                       Company shall pay Executive two years of
                                        Executive's base salary and the Deferred
                                        Bonus.  Such  payment will be based upon
                                        the base salary in existence at the time
                                        of termination.

o                                       In  the  event  of  death  of  Executive
                                        during  the Term of the  Agreement,  the
                                        two years of base  salary  and  Deferred
                                        Bonus  shall  be paid to the  estate  of
                                        Executive or as he shall direct.

o                                       Executive's  stock options granted under
                                        Paragraph  3.3  above,  shall have their
                                        vesting  accelerated  in  full  so as to
                                        become one hundred  percent vested as of
                                        the date of termination.

                   7.6  Termination  due to  Change  of  Control.If  at any time
during the Term a third party  acquires a  Controlling  Interest in the Company,
Executive  may at his  discretion,  elect to  sever  his  relationship  with the
Company. In this instance,  the provisions of paragraph 7.5 above shall apply. A
Controlling  Interest  shall be defined as a transfer of ownership of 40 percent
or more of the  outstanding  shares  of  Company.  In the  event of a Change  of
Control of Company occurring while Executive is employed by Company, Executive's
stock  options  granted  under  Paragraph  3.3 above,  shall have their  vesting
accelerated in full so as to become one hundred percent vested as of the date of
the Change of Control.

<PAGE>

          8.  Miscellaneous.
              -------------

                   8.1  Governing   Law.  This  Agreement  and  all  rights  and
obligations hereunder,  including, without limitation,  matters of construction,
validity and  performance,  is made under and shall be governed by and construed
in accordance  with the internal laws of the State of Nevada,  without regard to
principles of conflict of laws.

                   8.2   Amendments.   No  amendment  or  modification  of  this
Agreement shall be deemed  effective unless made in writing and signed by all of
the parties hereto.

                   8.3 No Waiver.  No term or condition of this Agreement  shall
be deemed to have been  waived,  nor shall there be any  estoppel to enforce any
provisions  of this  Agreement,  except by a statement in writing  signed by the
party against whom enforcement of the waiver or estoppel is sought.  Any written
waiver shall not be deemed a continuing waiver unless specifically stated, shall
operate  only  as to the  specific  term  or  condition  waived  and  shall  not
constitute  a waiver of such term or  condition  for the future or as to any act
other than that specifically waived.

                   8.4  Severability.  To  the  extent  any  provision  of  this
Agreement  shall be invalid or  unenforceable,  it shall be  considered  deleted
herefrom and the  remainder of such  provision  and of this  Agreement  shall be
unaffected and shall continue in full force and effect.  In furtherance  and not
in limitation of the foregoing,  should the duration or geographical  extent of,
or business  activities covered by, any provision of this Agreement be in excess
of that which is valid and enforceable under applicable law, then such provision
shall be construed to cover only that duration,  extent or activities  which may
validly and enforceably be covered.  Executive  acknowledges  the uncertainty of
the law in this respect and expressly  stipulates  that this  Agreement be given
the  construction  which renders its  provisions  valid and  enforceable  to the
maximum extent (not exceeding its express terms) possible under applicable law.

                   8.5 Assignment.  This Agreement  shall not be assignable,  in
whole or in part,  by either  party  without  the  written  consent of the other
party.

                   8.6  Injunctive  Relief.  Executive  agrees  that it would be
difficult to  compensate  the Company fully for damages for any violation of the
provisions of this  Agreement,  especially  the  provisions of Sections 4 and 6.
Accordingly, Executive specifically agrees that the Company shall be entitled to
temporary  and  permanent  injunctive  relief to enforce the  provisions of this
Agreement  and that such relief may be granted  without the necessity of proving
actual  damages.  This  provision  with respect to injunctive  relief shall not,
however,  diminish  the right of the  Company  to claim and  recover  damages in
addition to injunctive relief.

                   8.7  Arbitration.  Any controversy or claim arising out of or
relating to this Agreement or breach  thereof,  except for claims for injunctive
relief set out in  paragraph  8.6 above,  shall be  settled  by  arbitration  in
accordance  the  rules  of the  American  Arbitration  Association  relating  to
employment and judgment upon the award rendered by the arbitrator may be entered
in any court having jurisdiction  thereof. In reaching his or her decision,  the
arbitrator  shall have no  authority  to change or modify any  provision of this
Agreement.

<PAGE>

                   IN WITNESS  WHEREOF,  Executive and the Company have executed
this Agreement as of the date set forth in the first paragraph.

                                       IGT
                                       By:___________________________________
                                          Charles N. Mathewson
                                          Chairman of the Board

                                       EXECUTIVE

                                       By:___________________________________
                                          G. Thomas Baker

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