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Exhibit 10.1

As of May 26, 2004

Mr. Wallace R. Barr
President and Chief Executive Officer
Caesars Entertainment, Inc.
3930 Howard Hughes Parkway
Las Vegas, NV 89109

Re:Employment Agreement by and between Park Place Entertainment Corporation, a
Delaware corporation, now known as Caesars Entertainment, Inc. (the "Company"),
and Wallace R. Barr (the "Executive"), dated as of November 19, 2002 ("the
Employment Agreement").

Dear Wally:

The Compensation Committee of the Company's Board of Directors has authorized
certain technical amendment to the Employment Agreement as set forth in this
letter. All capitalized terms have the definitions assigned to them in the
Employment Agreement.

        1.     Subsection (h), Section 3 of the Employment Agreement is deleted
in its entirety and is replaced with the following:

        (h)    Stock Options and Stock Retention Units:    

        (i)    The Executive has been granted non-statutory stock options (the
"Incentive Options") under the Company's Stock Incentive Plan (the "Stock Plan")
covering 1,450,000 shares of the Company's common stock. The exercise price of
the shares subject to the Incentive Option shall be equal to the closing price
of the Company's common shares on the New York Stock Exchange on the date
granted. The Incentive Options shall be exercisable for ten years after grant
except as otherwise specifically provided in this Agreement. The Incentive
Options shall vest and become exercisable on a cumulative basis according to the
following schedule if the Executive continues in the employment of the Company
through the applicable vesting date(s):

        (1)   25% on the first anniversary of the grant date.

        (2)   50% on the second anniversary of the grant date.

        (3)   75% on the third anniversary of the grant date.

        (4)   100% on the fourth anniversary of the grant date.

        The Executive has been granted 635,000 Stock Retention Units, pursuant
to the Company's Supplemental Retention Plan dated November 1, 2001. The Stock
retention Units shall vest and become exercisable on a cumulative basis
according to the following schedule if the Executive continues in the employment
of the Company through the applicable vesting dates:

        (1)   20% on the first anniversary of the grant date.

        (2)   40% on the second anniversary of the grant date.

        (3)   70% on the third anniversary of the grant date.

        (4)   100% on the fourth anniversary of the grant date.

Executive shall also be eligible to receive such other grants and awards
available to senior executive officers of the Company (including grants of
Incentive Options, Restricted Stock and Performance Shares) in such amounts and
subject to such terms as the Compensation Committee of the Board of Directors
shall determine or as shall be provided in plans governing such grants or
awards.

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        Notwithstanding the foregoing paragraphs, all shares subject to the
Incentive Options, the Stock Retention Units and any additional equity incentive
vehicles shall vest and become exercisable upon the occurrence of any of the
following events (each of (A), (B), (C) and (D) below a "Triggering Event"):

        (A)  termination of the Executive's employment by the Company other than
for Cause, as defined below;

        (B)  termination of the Executive's employment because of death or
disability;

        (C)  termination of the Executive's employment by the Executive for Good
Reason, as defined below; or

        (D)  termination of the Employment Period by the Executive or the
Company pursuant to Section 1 of this Agreement after March 31, 2006.

        (E)  termination of Executive's employment by either the Executive or
the Company for any or no reason (other than a termination for Cause by the
Company) or upon mutual agreement between the Executive and the Company
following expiration of the Employment Period; this subsection (E) shall survive
the expiration of this Employment Agreement.

        (ii)   If a Triggering Event occurs, any portion of the Incentive
Options, the Stock Retention Units and any additional equity incentive vehicles
that have become vested on or before the date of such Event (including without
limitation, any portion that becomes exercisable due to such Triggering Event
and the Incentive Options) shall remain exercisable for the balance of their
term.

        (iii)  The Executive may assign the right to exercise the Incentive
Options, the Stock Retention Units and any additional equity incentive vehicles
to his spouse, children, grandchi1dren or parents of a recipient, to trusts for
the benefit of the Executive's immediate family, to a family partnership or
limited liability company designated by the Executive in which the Executive's
family members are the only partners or shareholders or to an entity exempt from
federal income tax under Section 501(C)(3) of the Code.

        (iv)  All Incentive Options and Stock Retention Units granted pursuant
to the Prior Agreement shall continue to be governed by the Company's Stock Plan
and the Supplemental Retention Plan.

        (v)   All Incentive Options, Stock Retention Units and any additional
equity incentive vehicles shall be subject to the terms of the Stock Plan and
the Supplemental Retention Plan in all respects not described herein but only to
the extent not inconsistent with the terms of this Agreement, to the extent not
inconsistent with the provisions of this Section 3(h).

        2.     Subsection (i), Section 3 of the Employment Agreement is deleted
in its entirety and is replaced with the following:

        (i)    Temporary Living and Moving Expenses.    Executive acknowledges
and agrees that he shall perform his duties hereunder at the corporate
headquarters of the Company in Las Vegas, NV and at the Company's east coast
office located in Atlantic City, NJ, and such other locations as may be required
by the nature of Executive's responsibilities. It is understood that Executive
maintains his primary residence in Las Vegas, NV and it is agreed that he shall
not be required to relocate his primary residence to any other location.    If
the Executive decides, in his sole discretion, to relocate his residence from
Las Vegas, Nevada, at any time with in twelve (12) months from the termination
of Executive's employment, the Company shall reimburse Executive for moving and
home seeking and buying expenses incurred by Executive in accordance with its
relocation policy for senior level executives, including at least all brokerage
commissions, transfer taxes and closing costs incurred in purchasing a new
residence and/or selling the Executive's current residence. The Company shall
also

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pay Executive a tax equivalency bonus in an amount such that all federal, state
and local income taxes (calculated at the highest marginal rate) which may be
due by reason of any such expenses and the tax equivalency bonus being included
in Executive's taxable income will not reduce the net amount of reimbursement
that Executive is to receive hereunder.

        3.     Subsection (b), Section 13 of the Employment Agreement is deleted
in its entirety and is replaced with the following:

        (b)   All notices and other communications under this Agreement shall be
in writing and shall be given by hand to the other party or by registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:

If to the Executive:
9017 Opus Drive
Las Vegas, NV 89117

If to the Company:
3930 Howard Hughes Parkway
Las Vegas. NY 89109
Attention: General Counsel

or to such other address as either party furnishes to the other in writing in
accordance with this paragraph (b) of Section 13. Notices and communications
shall be effective when actually received by the addressee.

All other terms and conditions of the Employment Agreement consistent with the
foregoing shall continue in full force and effect. Please indicate your
agreement and acceptance of the foregoing technical amendments by signing below.
Please return a fully executed copy of this letter to the Company's General
Counsel.

Very truly yours,    
Steve Bell
Executive Vice President
Human Resources, West and Midsouth
 
 
Agreed and accepted as of May 26, 2004:
 
 

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Wallace R. Barr
 
 

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Exhibit 10.1