EMPLOYMENT AGREEMENT

Exhibit 10.1

[Execution Copy]

EMPLOYMENT AGREEMENT

      THIS EMPLOYMENT AGREEMENT dated as of May 8, 2006 (this “Agreement”) , by and amongst Lottomatica S.p.A., an Italian corporation (the “Company”), GTECH Corporation, a Delaware corporation (“GTECH”), an indirect wholly-owned subsidiary of the Company, and CORNELIA LAVERTY O’CONNOR (“Executive”).

      WHEREAS , Executive is currently an executive officer employed by GTECH Holdings Corporation, a Delaware corporation and GTECH Corporation;

      WHEREAS , pursuant to the terms of an Agreement and Plan of Merger, dated as of January 10, 2006, the Company is acquiring 100% of the outstanding capital stock of GTECH Holdings Corporation, effective as of the date hereof (the “Merger”), and

      WHEREAS , the Company desires GTECH to employ Executive as an executive officer of GTECH, and Executive agrees to be employed by GTECH as an executive officer of GTECH, subject to the terms and conditions set forth below.

      NOW, THEREFORE , in consideration of the premises and of the mutual covenants herein contained, the parties hereto, intending to be legally bound, hereby covenant and agree as follows:

      1.  Definitions . Capitalized terms used in this Agreement and not otherwise defined herein shall have the following meanings:

      “Act” means the Securities Exchange Act of 1934, as amended to date.

      “Affiliate” shall mean any joint venture or other entity in which the Company or any of its subsidiaries has an equity interest of at least 20%.

      “Annual Cash Compensation” means the most recent annualized Base Salary paid or payable to Executive plus the average Performance Bonus paid or payable to Executive by the Company or GTECH for the three most recent completed fiscal years of employment. For the purposes of calculating Annual Cash Compensation, Base Salary shall include any elective salary reductions made by Executive and contributed by the Company on Executive’s behalf to the Company’s retirement plans.

      “Board” means the Board of Directors of GTECH.

      “Cause” means any of the following:

      “Change in Control” means the happening of any of the following:

      “Change of Control Date” means the date on which a Change in Control occurs, provided however that if a Change in Control occurs and if Executive’s employment with GTECH is terminated by GTECH prior to the date on which the Change in Control occurs, and if it is reasonably demonstrated by Executive that such termination of employment (i) was at the request of a third party who has taken steps reasonably calculated to effect a Change in Control or (ii) otherwise arose in connection with or in anticipation of a Change in Control, then the “Change of Control Date” shall mean the date immediately prior to the date of such termination.

      “Code” means the Internal Revenue Code of 1986, as amended.

      “Committee” means the Remuneration Committee of the Board.

      “Disability” means the inability (as determined by the Board in its sole discretion after affording Executive a reasonable opportunity to present her case) of Executive to render her agreed-upon, full-time services to GTECH due to physical and/or mental infirmity.

      “Effective Date” means the date on which the Merger is consummated.

      “Expiration Date” means the latest date upon which stock options granted to Executive would be exercisable under its grant terms if Executive had remained employed with GTECH through such date.

      “Family” means Executive’s spouse and dependant children.

      “Good Reason” means any of the following events (subject to the notice and cure provisions of Section 8(c) hereof):

      “Investor” shall mean De Agostini, S.p.A. and its affiliates.

      “Performance Bonus” means the actual amount of a performance bonus recommended by the Committee and approved by the Board to Executive with respect to the relevant fiscal year in accordance with Section 5(b) hereof.

      “Prorated Performance Bonus” means the portion of the Performance Bonus, if any, that is payable with respect to a fiscal year which becomes due after a termination of this Agreement under Sections 5(c) or 9(b) hereof. The Prorated Performance Bonus will be calculated as follows: the Committee shall (a) determine the Performance Bonus to which Executive would have been entitled, had Executive been employed for the entire fiscal year, in accordance with Section 5(b)(i) hereof, (b) divide that amount by 52 to produce a Weekly Amount; and (c) multiply the Weekly Amount by the number of weeks during the relevant fiscal year that Executive was employed by GTECH.

      “Retirement” means Executive’s termination of her employment when the sum of Executive’s age and years of continuous full-time employment with GTECH or any of its affiliates total to 65 or more, provided that Executive may not retire prior to the 5 year anniversary of the Effective Date.

      “Retirement Factor” means the sum of Executive’s age and years of continuous full-time employment with GTECH or any affiliate at the time of Executive’s Retirement.

      “Securities Act” means the Securities Act of 1933, as amended.

      “Senior Executives” means such executives of GTECH as constitute, from time-to-time, the “executive officers” of GTECH.

      “Shares” means ordinary shares of the Company.

      2.  Employment of Executive .

     GTECH hereby agrees to employ Executive, and Executive agrees to be employed by GTECH, to render services to GTECH and its subsidiaries, affiliates and divisions for the period, at the rate of compensation and upon the other terms and conditions set forth in this Agreement.

      3.  Term .

     The term of Executive’s engagement hereunder shall commence on the Effective Date, and shall continue for a term of five (5) years (the “Term”). The Term is subject to earlier termination as hereinafter provided in Section 8 hereof, and the compensation, benefits, etc., if any, payable upon termination shall be as set forth in Section 5(c) or 9 hereof.

      4.  Position, Duties and Place of Employment .

          (a) Position and Duties . During the Term, Executive shall be retained and shall serve as the Senior Vice President, Chief Marketing Officer of GTECH, and in furtherance of her duties as described herein, Executive also agrees to serve, if elected, as a director and/or officer of any subsidiary or affiliate of GTECH, including but not limited to GTECH.

          (b) During the Term, Executive shall have the authority and power to perform such duties consistent with her position as the Senior Vice President, Chief Marketing Officer, of GTECH.

          (c) Executive shall not be required without her consent to undertake responsibilities not commensurate with her position. Executive shall comply fully and promptly with the various policies, procedures and rules governing employees promulgated and/or as amended from time to time by GTECH and any applicable subsidiary or affiliate of GTECH (including, without limitation, GTECH’s Regulations for the Management of Confidential Information and GTECH’s Internal Rules Governing Intra-Group Transactions and Transactions with Other Related Parties) and with any applicable disclosure and other requirements of any governmental authority and of any other entity with which GTECH, its subsidiaries and affiliates are doing or propose to do business. Except for illness, vacations, and holidays in accordance with then-current GTECH policy, and (subject to the approval of the Chief Executive Officer of GTECH) reasonable leaves of absence, Executive shall devote her full business time, attention, skill, undivided loyalty and best efforts to the faithful performance of her duties hereunder; provided, however, that Executive may, as long as such activities do not interfere with the performance of Executive’s responsibilities: (i) with the prior approval of the Chief Executive Officer of GTECH, serve (and retain any compensation with respect to such service) on corporate, civic and charitable boards and committees and (ii) deliver lectures and fulfill speaking engagements.

          (d) Principal Place of Employment . Executive’s principal place of employment shall be located within the State of Rhode Island. Notwithstanding the foregoing, Executive understands that she may be required to spend substantial time in Italy during the Term.

      5.  Compensation and Reimbursement of Expenses

          (a) Base Salary . For the services rendered by Executive in her capacity as the Senior Vice President, Chief Marketing Officer of GTECH during the Term, GTECH shall pay or cause to be paid to Executive as compensation a salary at an annual rate of US $300,000, payable in equal installments not less frequently than monthly through GTECH’s standard payroll practices. Executive hereby expressly waives any and all of her rights to any further fees or payments for the offices as a director and/or officer of its subsidiaries and affiliates which may be held by him during the Term, and agrees to confirm such waiver before the appropriate corporate bodies of each such company upon request of the Board .

          (b) Performance Bonus .

               (i) With respect to each fiscal year of GTECH during the Term, Executive shall be eligible to earn a Performance Bonus at the discretion of the Board or the Committee. The amount of the Performance Bonus, if any, for a given fiscal year shall be determined by the Board or the Committee in accordance with the performance metrics and business objectives included in GTECH annual bonus plan for Senior Executives, as approved annually in the discretion of the Board or the Committee. Under the Plan, Executive’s performance will be measured against an established set of targets for each fiscal year, and depending upon performance against those targets, Executive will be eligible to receive a bonus in the range of 0% to 120% of Base Salary. The annual target Performance Bonus will be 60% of Base Salary.

               (ii) Bonus payments for GTECH are normally made in April or May of each year for the preceding fiscal year ending in December, subject to the provisions of Section 409A of the Code.

               (iii) Nothing contained in this Agreement constitutes a guarantee that the Board will award Executive a Performance Bonus for any given fiscal year.

          (c) Change of Control .

               (i) In the event Executive’s employment is terminated by GTECH for any reason other than Cause, or in the event Executive resigns for Good Reason within eighteen months after either (A) the effectiveness of the Merger or (B) the Change of Control Date, GTECH will pay Executive, as liquidated damages, a lump sum cash payment in lieu of the severance payments provided under Section 9(b) hereof, payable within ten (10) days of Executive’s termination, equal to two and ninety-nine hundredths (2.99) times the sum of (A) Executive’s current annual Base Salary in effect at the date of termination (including in base salary for this purpose any elective salary reductions made by Executive and contributed by GTECH on Executive’s behalf to GTECH’s retirement plan, any non-qualified plan, or a plan meeting the requirements of Section 125 of the Code), plus (B) the average Performance Bonus paid or payable to Executive from GTECH for the three (3) most recent full fiscal years of GTECH, plus (C) the maximum amount allowable under the GTECH Executive Perquisite Program or any substitute or replacement program adopted by GTECH during the most recent calendar year of GTECH. In addition, GTECH shall pay Executive within 10 days after such termination (i) her Base Salary accrued through the date of such termination at the rate in effect immediately prior to such date; (ii) any accrued but unpaid Performance Bonus under Section 5(b) hereof for the prior fiscal year; (iii) any Prorated Performance Bonus up to the date of such termination calculated by reference to Executive’s target Performance Bonus, as determined by the Committee for the current fiscal year; and (iv) any other amounts to which Executive is entitled under the terms of Sections 5 and 6 hereof up to the date of such termination. The payment of any Performance Bonus or Prorated Performance Bonus after such termination shall be made in cash, notwithstanding the provisions of Section 5(b)(i) hereof.

               (ii) In the event of a termination described in Section 5(c)(i) above, Executive, together with Executive’s dependents and beneficiaries, will become fully vested in and continue following Executive’s termination to participate fully in, at no additional cost to Executive, all life insurance plans, accident and health plans and other welfare plans, maintained or sponsored by GTECH immediately prior to the termination, at the same level and subject to terms at least as favorable to Executive as in effect immediately prior to termination (or the full value thereof in cash) from GTECH, until the third anniversary of termination. Executive will also become fully vested in all non-qualified retirement plans, and within thirty (30) days of Executive’s termination of employment, GTECH shall pay to Executive the sum of (i) all benefits accrued under the any non-qualified plans and (ii) an amount equal to 2.99 times the average benefit accrued and/or Company or GTECH contributions made to the retirement plans and the non-qualified plans over the last three fiscal years prior to termination. Additionally, to the extent Executive is not fully vested in all Company or GTECH qualified retirement plans, Executive shall receive a payment equal to any unvested portion of such retirement plans. In addition, in the event of a Change in Control (other than the Merger) prior to the Executive’s

termination of employment, any Shares not yet issued and transferred to Executive pursuant to Sections 6(c) or 6(d) hereof shall be promptly issued and transferred to Executive whether or not she has satisfied the performance and employment requirements set forth therein and any and all Cash-Based Awards (as defined in Section 6(e) hereof) and stock options granted to Executive that have not yet become vested and exercisable shall become vested and exercisable.

               (iii) Anything in this Agreement to the contrary notwithstanding and except as set forth below, in the event it shall be determined that any payment or distribution by the Company or GTECH to or for the benefit of Executive (whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (a “Payment”) would be subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties are incurred by Executive with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter collectively referred to as the “Excise-Tax”), whether in connection with the Merger or any Change in Control, then Executive shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after payment by Executive of all taxes (including any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed on the Payments. GTECH shall pay to Executive any Gross-Up Payments required as a result of Excise Taxes payable by Executive arising from the Merger.

               (iv) All determinations required to be made under this Section 5(c), including whether and when a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be made by Ernst & Young LLP or such other nationally recognized certified public accounting firm as may be designated by Executive (the “Accounting Firm”) which shall provide detailed supporting calculations both to GTECH and Executive within 15 business days of the receipt of notice from Executive that there has been a Payment, or such earlier time as is requested by GTECH. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting the Change in Control, Executive shall appoint another nationally recognized accounting firm to make the determinations required hereunder (which accounting firm shall then be referred to as the Accounting Firm hereunder). All fees and expenses of the Accounting Firm shall be borne solely by GTECH. Any Gross-Up Payment, as determined pursuant to this Section 5(c), shall be paid by GTECH to Executive within five days of the receipt of the Accounting Firm’s determination. Subject to the remainder of this Section 5(c), any determination by the Accounting Firm shall be binding upon GTECH and Executive. As a result of the uncertainty in the application of Section 280G and Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by GTECH should have been made (“Underpayment”), consistent with the calculations required to be made hereunder. In the event that GTECH exhausts its remedies and Executive thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by GTECH to or for the benefit of Executive (so as to fully extinguish Executive’s tax liability for the Payments including all interest and penalties).

               (v) Executive shall notify GTECH in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by GTECH of the Gross-Up Payment. Such notification shall be given as soon as practicable but no later than ten business days after Executive is informed in writing of such claim and shall apprise GTECH of the nature of such claim and the date on which such claim is requested to be paid. Executive shall not pay such claim prior to the expiration of the 30-day period following the date on which Executive gives such notice to GTECH (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If GTECH notifies Executive in writing prior to the expiration of such period that it desires to contest such claim, Executive shall:

     (A) give GTECH any information reasonably requested by GTECH relating to such claim,

     (B) take such action in connection with contesting such claim as GTECH shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by GTECH,

     (C) cooperate with GTECH in good faith in order effectively to contest such claim, and

     (D) permit GTECH to participate in any proceedings relating to such claim;

provided, however, that GTECH shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold Executive harmless, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties with respect thereto) imposed as a result of such representation and payment of costs and expenses. Without limitation on the foregoing provisions of this Section 5(c), GTECH shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forgo any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct Executive to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and Executive agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as GTECH shall determine; provided, however, that if GTECH directs Executive to pay such claim and sue for a refund, GTECH shall advance the amount of such payment to Executive, on an interest-free basis and shall indemnify and hold Executive harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or penalties with respect thereto) imposed with respect to such advance or with respect to any imputed income with respect to such advance; and further provided that any extension of the statute of limitations relating to payment of taxes for the taxable year of Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, GTECH’s control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and Executive shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority.

               (vi) If, after the receipt by Executive of an amount advanced by GTECH pursuant to Section 5(c), Executive becomes entitled to receive any refund with respect to such claim, Executive shall (subject to GTECH’s complying with the requirements of Section 5(c)) promptly pay to GTECH the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by Executive of an amount advanced by GTECH pursuant to Section 5(c), a determination is made that Executive shall not be entitled to any refund with respect to such claim and GTECH does not notify Executive in writing of its intent to contest such denial of refund prior to the expiration of 30 days after such determination then such advance shall be forgiven and shall not be required to be repaid and the amount of such advance shall offset, to the extent thereof, the amount of Gross-Up Payment required to be paid.

          (d) Reimbursement of Expenses . Consistent with GTECH’s established policies, GTECH shall pay or reimburse Executive for all reasonable and necessary travel and other expenses of Executive incurred by Executive in performing her duties hereunder upon receipt of appropriate written substantiation of such expenses.

          (e) Housing . If deemed necessary by the Chief Executive Officer of the Company for the performance of Executive’s duties hereunder, the Company shall make available to Executive at no cost to Executive rental or other short-term housing near the Company’s Rome headquarters.

      6.  Benefits .

          (a) Benefits . Except as otherwise expressly provided herein, Executive shall be entitled to receive, during the Term, benefits substantially similar to the level of benefits provided generally to Senior Executives under any benefit plan, program or arrangement of GTECH in effect, subject to Executive’s meeting the eligibility requirements of such plans, programs or arrangements, and in the case of benefit plans, programs or arrangements providing for discretionary grants or awards, to the discretion of the Board or applicable committee.

          (b) Stock Options . Executive shall receive the following stock options in accordance with the following terms and conditions:

               (i) Executive shall be eligible for consideration by the Committee for annual grants of stock options under the Company’s stock option or equity compensation plans existing on the date of this Agreement or established hereafter (each being referred to as a “Long Term Incentive Plan”), in the sole discretion of the Committee.

               (ii) All grants of stock options under this Agreement are subject to and conditioned upon the Company obtaining all necessary shareholder approvals, if any, which Company shall use all reasonable efforts to obtain.

          (c) Grant of Shares . Not less than 35% of the calculated value of annual long term incentive awards under a Long Term Incentive Plan shall be provided to Executive in the form of an award of fully-vested Shares. The foregoing awards of fully-vested Shares will be subject to all the terms of the applicable Long Term Incentive Plan. It is intended that the foregoing awards of Shares will be valued on the dates of grant of such awards, but will provide

that such Shares will only be issued and transferred to the Executive upon the future achievement of certain target performance goals to be determined by the Company consistent with its equity compensation policies for Senior Executives, and provided that the Executive is continuously employed by GTECH. Notwithstanding the foregoing, the Company may grant the foregoing Shares on such other basis as is consistent with its Share grants to other Senior Executives of the Company.

          (d) Award of Shares . Executive shall be eligible for a 2007 long-term incentive award at such time as such awards are made for other Senior Executives. The value of such award on the date of grant will be split 65% stock options and 35% Shares using traditional Black Scholes option pricing. Such award shall be made under the term