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Exhibit 10.8  


 
 

HARRAH'S OPERATING COMPANY, INC.
  HARRAH'S ENTERTAINMENT, INC.    
    


$500,000,000  


5.375% Senior Notes due 2013  


Payment of Principal, Interest and

Premium, if any, Guaranteed by  


Harrah's Entertainment, Inc.  


PURCHASE AGREEMENT  


New
York, New York

December 8, 2003 


Citigroup
Global Markets Inc.

388 Greenwich Street

New York, New York 10013 


Ladies
and Gentlemen: 


        Harrah's
Operating Company, Inc., a Delaware corporation (the "Company"), proposes to issue and sell to you, as initial purchaser
(the "Initial Purchaser"), $500,000,000 principal amount of its 5.375% Senior Notes due 2013 (the
"Notes") payment of principal, interest and premium, if any, in respect of which notes are to benefit from guarantees (the
"Guarantees") of Harrah's Entertainment, Inc., a Delaware corporation (the "Guarantor") (such
notes, together with such guarantee, the "Securities"). The Securities are to be issued under an indenture (the
"Indenture") to be dated as of December 11, 2003, among the Company, the Guarantor and U.S. Bank National Association, as trustee (the
"Trustee"). The Securities have the benefit of a registration rights agreement (the "Registration Rights
Agreement") dated as of December 11, 2003, among the Company, the Guarantor and the Initial Purchaser, pursuant to which the Company and the Guarantor have agreed to
register the Securities under the Securities Act, subject to the terms and conditions therein specified. The sale of the Securities to the Initial Purchasers will be made without registration of the
Securities under the Securities Act in reliance upon exemptions from the registration requirements of the Securities Act. 


        In
connection with the sale of the Securities, the Company and the Guarantor have prepared an offering memorandum dated December 8, 2003 (including any information incorporated by
reference therein, the "Offering Memorandum"). The Offering Memorandum sets forth certain information concerning the Company, the Guarantor and the
Securities. Unless stated to the contrary, all references herein to the Offering Memorandum are to the Offering Memorandum at the Execution Time and are not meant to include any amendment or
supplement, or any information incorporated by reference therein, subsequent to the Execution Time. The Company hereby confirms that it has authorized the use of the Offering Memorandum, and any
amendment or supplement thereto, in connection with the offer and sale of the Securities by the Initial Purchaser. 


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        To
the extent there are no additional parties listed in the table below other than you, the term "Representative" as used herein shall mean you as the Initial Purchaser, and the term
Initial Purchasers shall mean either the singular or plural as the context requires. The use of the neuter in this Agreement shall include the feminine and masculine wherever appropriate. Certain
terms used herein are defined in Section 9 of Annex I hereto. Unless stated to the contrary, any references herein to the terms "amend," "amendment" or "supplement" with respect to the Offering
Memorandum shall be deemed to refer to and include any information filed under the Exchange Act subsequent to the Execution Time that is incorporated by reference therein. 


        Subject
to the terms and conditions, and in reliance upon the representations and warranties, set forth or incorporated by reference herein, the Company hereby agrees to sell to the
Initial Purchaser, and the Initial Purchaser agrees to purchase from the Company, the principal amount of Securities set forth below opposite its name at a purchase price of 98.744% of the principal
amount of Securities, plus accrued interest, if any, from December 11, 2003 to the date of payment and delivery: 



	Initial Purchasers
 
	 	Principal Amount of

Securities to Be Purchased

	Citigroup Global Markets Inc.	 	$	500,000,000





        The
Initial Purchaser will pay for the Securities upon delivery thereof at the offices of Cleary, Gottlieb, Steen & Hamilton, One Liberty Plaza, New York, New York at
10:00 a.m. (New York City time) on December 11, 2003, or at such other time, not later than 5:00 p.m. (New York City time) on December 15, 2003, as shall be designated by
the Representative. The time and date of such payment and delivery are hereinafter referred to as the Closing Date. 


        The
Securities shall have the terms set forth in the Offering Memorandum dated December 8, 2003, including the following: 


 
 

Terms of Securities    
    



	Maturity Date:	 	December 15, 2013
	

Interest Rate:	
 	

5.375%
	

Optional Redemption:	
 	

Make Whole Call at TSY + 20 basis points
	

Interest Payment Dates:	
 	

Each June 15 and December 15, commencing June 15, 2004
	

Closing Date:	
 	

December 11, 2003





        All
provisions contained in the Annex I hereto, entitled "Purchase Agreement General Provisions," are herein incorporated by reference in their entirety and shall be deemed to be a part
of this Agreement to the same extent as if such provisions had been set forth in full herein, except that if any term defined in such document is otherwise defined herein, the definition set forth
herein shall control. 


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        If
the foregoing is in accordance with your understanding of our agreement, please sign and return to us the enclosed duplicate hereof, whereupon this Agreement and your acceptance shall
represent a binding agreement between the Company and the Guarantor and the Initial Purchaser. 



	 	 	Very truly yours,
	

 	
 	

HARRAH'S OPERATING COMPANY, INC.
	

 	
 	

By:	
 	

/s/  JONATHAN HALKYARD      

	 	 	 	 	Name:	 	Jonathan Halkyard
	 	 	 	 	Title:	 	Vice President of Finance
	

 	
 	

HARRAH'S ENTERTAINMENT, INC.
	

 	
 	

By:	
 	

/s/  JONATHAN HALKYARD      

	 	 	 	 	Name:	 	Jonathan Halkyard
	 	 	 	 	Title:	 	Vice President of Finance




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The
foregoing Agreement is hereby confirmed and accepted as of the date first above written. 



	CITIGROUP GLOBAL MARKETS INC.	 	 
	

By:	
 	

/s/  NIKHIL O.J. EAPEN      
	
 	

 
	 	 	Name:	 	Nikhil O.J. Eapen	 	 
	 	 	Title:	 	Vice President	 	 




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ANNEX I  


 
 

HARRAH'S OPERATING COMPANY, INC.    
    


Guaranteed Debt Securities  


Payment of Principal, Interest and

Premium, if any, Guaranteed by  


Harrah's Entertainment, Inc.  


PURCHASE AGREEMENT GENERAL PROVISIONS  


December 8, 2003


        The
provisions set forth herein are incorporated by reference in a Purchase Agreement of even date herewith (such agreement, including the provisions hereof as incorporated therein, the
"Purchase Agreement"). The Purchase Agreement is sometimes referred to herein as this "Agreement." Terms
defined in the Purchase Agreement are used herein as therein defined. 


        1.     Representations and Warranties. The Company and the Guarantor, jointly and severally, represent and warrant to and agree
with each of the Initial Purchasers that: 



        (a)   The
Offering Memorandum does not contain and, as amended or supplemented, if applicable, will not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this
paragraph do not apply to statements or omissions in the Offering Memorandum based upon information relating to any Initial Purchaser furnished to the Company in writing by such Initial Purchaser
through the Representative expressly for use therein; 


        (b)   Each
of the Company and the Guarantor has been duly incorporated, is validly existing as a corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property and to conduct its business as described in the Offering Memorandum and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified or be
in good standing would not have a material adverse effect on the Company or the Guarantor and their respective subsidiaries, taken as a whole; 


        (c)   Each
subsidiary of the Company and the Guarantor, respectively, has been duly organized or formed, as applicable, is validly existing as a corporation, limited liability
company or partnership in good standing under the laws of the jurisdiction of its organization or formation, as applicable, has the power and authority to own its property and to conduct its business
as described in the Offering Memorandum and is duly qualified to transact business and is in good standing in each jurisdiction in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the failure to be so qualified or be in good standing would not have a material adverse effect on the Company or the Guarantor and their
respective subsidiaries, taken as a whole; all of the issued shares of capital stock or other equity interests of each subsidiary of the Company and the Guarantor, respectively, have been duly and
validly authorized and issued and are fully paid and non-assessable. Except as set forth in or as incorporated by reference in the Offering Memorandum, all of the shares of capital stock
or other equity or partnership interests of each subsidiary of the Company or the Guarantor that would be considered a "significant subsidiary" for purposes of Rule 1-02 under
Regulation S-X 






 




pursuant
to the Securities Act (the "Significant Subsidiaries") are owned directly or indirectly by the Company or the Guarantor, respectively. Except
as set forth in or as incorporated by reference in the Offering Memorandum, all of the shares of capital stock or other equity or partnership interests of subsidiaries of the Company or the Guarantor
held by the Company or the Guarantor are held free and clear of all liens, encumbrances, equities or claims except such liens, encumbrances, equities or claims imposed by Gaming Laws or the terms of
any partnership agreement pertaining to any partnership that is a subsidiary of the Company or that would not would not have a material adverse effect on the Company or the Guarantor and their
respective subsidiaries, taken as a whole; 


        (d)   This
Agreement has been duly authorized, executed and delivered by each of the Company and the Guarantor; 


        (e)   The
Indenture has been, or will be by the Closing Date, duly authorized, executed and delivered by each of the Company and the Guarantor and, assuming due authorization,
execution and delivery thereof by the Trustee, is, or will be by the Closing Date, a valid and binding agreement of each of the Company and the Guarantor, respectively, enforceable in accordance with
its terms, subject to applicable bankruptcy, insolvency or similar laws affecting creditors' rights generally and general principles of equity; 



        (f)    The
Registration Rights Agreement has been, or will be by the Closing Date, duly authorized, executed and delivered by each of the Company and the Guarantor and,
assuming due authorization, execution and delivery thereof by the Representative, is, or will be by the Closing Date, a valid and binding agreement of each of the Company and the Guarantor,
respectively, enforceable in accordance
with its terms, subject to applicable bankruptcy, insolvency or similar laws affecting creditors' rights generally and general principles of equity; 


        (g)   The
Securities have been duly authorized by the Company and the Guarantor and, when executed, authenticated and issued in accordance with the provisions of the Indenture
and delivered to and paid for by the Initial Purchasers in accordance with the terms of the Purchase Agreement, (assuming due authorization, execution and delivery thereof by the Trustee) will be
entitled to the benefits of the Indenture, and will be valid and binding obligations of the Company and the Guarantor, respectively, in each case enforceable in accordance with their respective terms,
subject to applicable bankruptcy, insolvency or similar laws affecting creditors' rights generally and general principles of equity; 


        (h)   The
execution and delivery by each of the Company and the Guarantor of, and the performance by each of the Company and the Guarantor of its respective obligations under,
this Agreement, the Indenture, the Registration Rights Agreement and the Securities will not contravene any provision of applicable law or the certificate of incorporation or by-laws of
the Company or the Guarantor, respectively, or any agreement or other instrument binding upon the Company or any of its subsidiaries, or the Guarantor or any of its subsidiaries, respectively, that is
material to the Company or the Guarantor and their respective subsidiaries, taken as a whole, or any judgment, order or decree of any governmental body, agency or court having jurisdiction over the
Company or the Guarantor and any of their respective subsidiaries, and no consent, approval, authorization, filing with or order of, or qualification with, any governmental body or agency is required
in connection with, or prior to the consummation of, the transactions contemplated in, or for the performance by the Company or the Guarantor of its respective obligations under, this Agreement, the
Indenture, the Registration Rights Agreement and the Securities, except such as will be obtained under the Securities Act, the Exchange Act, and the Trust Indenture Act, or as may be required by the
securities or Blue Sky laws of the various states and securities laws of any jurisdiction outside the United States in connection with the offer and sale of the Securities, or as have been obtained
pursuant to Gaming Laws; 



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        (i)    There
has not occurred any material adverse change, or any development involving a prospective material adverse change, in the condition, financial or otherwise, or in
the earnings, business or operations of the Company or the Guarantor and their respective subsidiaries, taken as a whole, from that set forth in the Offering Memorandum (exclusive of any amendments or
supplements thereto subsequent to the Execution Time); 


        (j)    To
the knowledge of the Company, there are no known legal or governmental proceedings pending or threatened to which the Company or the Guarantor and any of their
respective subsidiaries is a party or to which any of the properties of the Company or the Guarantor or any of their respective subsidiaries is subject that are not adequately disclosed in the
Offering Memorandum and that would, individually or in the aggregate, have a material adverse effect on the Company or the Guarantor and their respective subsidiaries, taken as a whole. Except as
disclosed in the Offering Memorandum, neither the Company nor the Guarantor has any reason to believe that any governmental agency with
authority pursuant to any Gaming Law is investigating the Company, the Guarantor or any of their respective subsidiaries in any non-routine matter, the results of which would materially
affect the operations of the Company and the subsidiaries of the Company. Due to the highly regulated nature of the business of the Company and the subsidiaries of the Company, there are ongoing
investigations by various governmental agencies with authority pursuant to the various Gaming Laws; 



        (k)   Neither
the Company nor the Guarantor is, and after giving effect to the offering and sale of the Securities and the application of the proceeds thereof as described in
the Offering Memorandum, neither will be, an "investment company" or an entity "controlled by an investment company" as such terms are defined in the Investment Company Act; 


        (l)    The
Company and the Guarantor and their respective subsidiaries (i) are in compliance with any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants ("Environmental
Laws"), (ii) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses, and
(iii) are in compliance with all terms and conditions of any such permit, license or approval, except where such noncompliance with Environmental Laws, failure to receive required permits,
licenses or other approvals or failure to comply with the terms and conditions of such permits, licenses or approvals would not, individually or in the aggregate, have a material adverse effect on the
Company or the Guarantor and their respective subsidiaries, taken as a whole; 


        (m)  There
are no costs or liabilities associated with Environmental Laws (including, without limitation, any capital or operating expenditures required for
clean-up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to
third parties) that would, individually or in the aggregate, have a material adverse effect on the Company or the Guarantor and their respective subsidiaries, taken as a whole; 


        (n)   Except
as disclosed in the Offering Memorandum, each of the Company and the Guarantor and their respective subsidiaries has sufficient trademarks, trade names, patent
rights, copyrights, or licenses to conduct their respective businesses as now conducted in all material respects; 



        (o)   Except
as disclosed in or specifically contemplated by the Offering Memorandum, each of the Company and the Guarantor and their respective subsidiaries has sufficient
licenses, approvals and authorizations required pursuant to Gaming Laws to conduct their respective current businesses, except such licenses, approvals and authorizations required pursuant to Gaming
Laws 



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the
absence of which, either individually or in the aggregate, would not have a material adverse effect on the Company or the Guarantor and their respective subsidiaries, taken as a whole; 



        (p)   Each
of the Company's and Guarantor's and their respective subsidiaries' controlling persons, key employees, and, to the Company's or the Guarantor's knowledge,
stockholders, have all necessary permits, licenses and other authorizations required by Gaming Laws for the Company, the Guarantor and their respective subsidiaries to conduct their respective
businesses as now conducted in all material respects; and neither the Company nor the Guarantor has any knowledge that any of their respective stockholders is unsuitable or may be deemed unsuitable by
any authorities pursuant to Gaming Laws; 


        (q)   No
labor dispute with the employees of the Company or the Guarantor or any of their respective subsidiaries exists, or to the knowledge of the Company or the Guarantor,
respectively, is imminent that would, individually or in the aggregate, have a material adverse effect on the Company or the Guarantor and their respective subsidiaries, taken as a whole; 


        (r)   Neither
the Company, nor the Guarantor, nor any of their respective affiliates, nor any person acting on its or their behalf has, directly or indirectly, made offers or
sales of any security, or solicited offers to buy any security, under circumstances that would require the registration of the Securities under the Securities Act; 


        (s)   Neither
the Company, nor the Guarantor, nor any of their respective affiliates, nor any person acting on its or their behalf has engaged in any form of general
solicitation or general advertising (within the meaning of Regulation D) in connection with any offer or sale of the Securities in the United States; 


        (t)    Assuming
the accuracy of the representations and warranties and compliance with the agreements of the Initial Purchasers made pursuant to Section 3 and except as
described in the Offering Memorandum under "Description of Notes—Registration Rights," it is not necessary in connection with the offer, sale and delivery of the Securities in the manner
contemplated by this Agreement and the Offering Memorandum to register the Securities under the Securities Act or to qualify the Indenture under the Trust Indenture Act; 



        (u)   The
Securities satisfy the eligibility requirements of Rule 144A(d)(3) under the Securities Act; 


        (v)   Neither
the Company, nor the Guarantor, nor any of their respective affiliates, nor any person acting on its or their behalf has engaged in any directed selling efforts
with respect to the Securities, and each of them has complied with the offering restrictions requirement of Regulation S. Terms used in this paragraph have the meanings given to them by
Regulation S; 


        (w)  The
Company and Guarantor are subject to and in compliance in all material respects with the reporting requirements of Section 13 or Section 15(d) of the
Exchange Act; 


        (x)   Neither
the Company nor the Guarantor has, within the past 12 months, paid or agreed to pay to any person any compensation for soliciting another to purchase any
securities of the Company or Guarantor (except as contemplated by this Agreement and except in connection with any repurchase by the Guarantor of its outstanding securities (other than the
Securities)); and 


        (y)   The
Company and the Guarantor are in compliance in all material respects with all applicable provisions of the Sarbanes-Oxley Act of 2002 and the rules and regulations
of the Commission adopted thereunder. 




        2.     Payment and Delivery. Except as otherwise provided in this Section 2, payment for the Securities shall be made to
the Company in federal or other funds immediately available at the time and place set forth in the Purchase Agreement, upon delivery to the Representative for the respective 


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accounts
of the several Initial Purchasers of the Securities registered in such names and in such denominations as the Representative shall request in writing not less than one full Business Day prior
to the date of delivery, with any transfer taxes payable in connection with the transfer of the Securities to the Initial Purchasers duly paid by the Company. Delivery of the Securities shall be made
through the facilities of The Depository Trust Company unless the Representative shall otherwise instruct. 


        3.     Offering by Initial Purchasers. Each Initial Purchaser, severally and not jointly, represents and warrants to and agrees
with the Company and the Guarantor that: 



        (a)   It
has not offered or sold, and, until the Securities are registered under the Act as described in the Offering Memorandum under the caption "Description of
Notes—Registration Rights," will not offer or sell, any Securities except (i) to those it reasonably believes to be qualified institutional buyers (as defined in Rule 144A
under the Act) and that, in connection with each such sale, it has taken or will take reasonable steps to ensure that the purchaser of such Securities is aware that such sale is being made in reliance
on Rule 144A; or (ii) in accordance with the restrictions set forth in Exhibit A hereto. 


        (b)   Neither
it nor any person acting on its behalf has made or will make offers or sales of the Securities in the United States by means of any form of general solicitation
or general advertising (within the meaning of Regulation D) in the United States. 




        4.     Conditions to the Initial Purchasers' Obligations. The several obligations of the Initial Purchasers are subject to the
performance by the Company and Guarantor of their obligations hereunder and to the following conditions: 



        (a)   Subsequent
to the execution and delivery of the Purchase Agreement and prior to the Closing Date: 



        (i)    there
shall not have occurred any downgrading, nor shall any notice have been given of any intended or potential downgrading or of any review for a possible change that
does not indicate the direction of the possible change, in the rating accorded any of the Company's or the Guarantor's securities by any "nationally recognized statistical rating organization," as
such term is defined for purposes of Rule 436(g)(2) under the Act; and 


        (ii)   there
shall not have occurred any change, or any development involving a prospective change, in the condition, financial or otherwise, or in the earnings, business or
operations of the Company or the Guarantor and their respective subsidiaries, taken as a whole, from that set forth in the Offering Memorandum (exclusive of any amendments or supplements thereto
subsequent to the Execution Time) that, in the judgment of the Representative, is material and adverse and that makes it, in the judgment of the Representative, impracticable or inadvisable to proceed
with the offering, sale or delivery of the Securities on the terms and in the manner contemplated in the Offering Memorandum. 




        (b)   The
Initial Purchasers shall have received on the Closing Date a certificate, dated the Closing Date and signed by an executive officer of each of the Company and the
Guarantor, to the effect set forth in Section 4(a)(i) above and to the effect that the representations and warranties of the Company and the Guarantor, respectively, contained in this
Agreement are true and correct as of the Closing Date and that the Company and the Guarantor, respectively, have complied with all of the agreements and satisfied all of the conditions on its part to
be performed or satisfied hereunder on or before the Closing Date. The officer signing and delivering such certificate may rely upon the best of his or her knowledge as to proceedings threatened. 



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        (c)   The
Initial Purchasers shall have received on the Closing Date an opinion of Stephen H. Brammell, Senior Vice President and General Counsel of the Company and the
Guarantor, dated the Closing Date, to the effect that: 



        (i)    each
of the Company, the Guarantor and the Significant Subsidiaries has been duly organized or formed, as applicable, is validly existing as a corporation, limited
liability company or partnership in good standing under the laws of the jurisdiction of its organization or formation, as applicable, has the power and authority to own its property and to conduct its
business as described in the Offering
Memorandum and is duly qualified to transact business and is in good standing in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or be in good standing would not have a material adverse effect on the Company or the Guarantor and their respective
subsidiaries, taken as a whole; 


        (ii)   after
inquiry of the members of the legal departments of the Company and Guarantor, to the best of such counsel's knowledge, (A) there are no legal or
governmental proceedings pending or threatened to which the Company or the Guarantor and any of their respective subsidiaries is a party or to which any of the properties of the Company or the
Guarantor or any of their respective subsidiaries is subject that are not adequately disclosed in the Offering Memorandum and which would, individually or in the aggregate, have a material adverse
effect on the Company or the Guarantor and their respective subsidiaries, taken as a whole, (B) there are no material statutes, regulations, contracts or other documents that are not adequately
disclosed in the Offering Memorandum, and (C) there is no non-routine investigation of the Company, the Guarantor or any of their respective subsidiaries, by any governmental agency
with authority pursuant to any Gaming Law, the results of which would have a material adverse effect on the Company, the Guarantor or any of their respective subsidiaries; 


        (iii)  each
of the Company's, the Guarantor's and their respective subsidiaries' controlling persons, key employees, and, to the best of such counsel's knowledge, their
stockholders, have all necessary permits, licenses and other authorizations required by Gaming Laws for the Company, the Guarantor and their respective subsidiaries to conduct their businesses as now
conducted except such licenses, approvals and authorizations required pursuant to Gaming Laws the absence of which, either individually or in the aggregate, would not have a material adverse effect on
the Company or the Guarantor and their respective subsidiaries, taken as a whole; and to the best of such counsel's knowledge none of the respective stockholders of the Company or the Guarantor is
unsuitable or may be deemed unsuitable by any authorities pursuant to Gaming Laws; 


        (iv)  the
statements (A) in the Offering Memorandum under the captions "Regulation and Licensing," and "Legal Matters," (B) in "Items 1 and 2 -Business and
Properties—Governmental Regulation" and "Item 3—Legal Proceedings" of the Company's annual report on Form 10-K in respect of the year ended
December 31, 2002, which is incorporated by reference in the Offering Memorandum, and (C) in "Item 2—Management's Discussion and Analysis of Financial Condition and Results
of Operations—Debt and Liquidity" of the Company's quarterly report on Form 10-Q in respect of the quarter ended September 30, 2003, which is incorporated by
reference in the Offering Memorandum, in each case insofar as such statements constitute summaries of the legal matters, documents or proceedings referred to therein, fairly present the information
called for with respect to such legal matters, documents and proceedings and fairly summarize the matters referred to therein; 


        (v)   no
consent, approval, authorization of, or qualification with any authority pursuant to Gaming Laws is required with respect to the issuance of the Securities or the
transactions 




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contemplated
by this Agreement and the Indenture prior to such issuance of the Securities or the transactions contemplated by this Agreement, except as has already been obtained; and 



        (vi)  the
execution and delivery by each of the Company and the Guarantor of the transactions contemplated in, and the performance by the Company and the Guarantor of their
respective obligations under, this Agreement, the Indenture, the Registration Rights Agreement and the Securities will not contravene, to the best of such counsel's knowledge, any agreement or other
instrument binding upon the Company or the Guarantor and any of their respective subsidiaries that is material to the Company or the Guarantor and their respective subsidiaries, taken as a whole, or,
except for any approvals required from the Indiana Gaming Commission for the Company to perform its obligations under the Registration Rights Agreement, to the best of such counsel's knowledge, any
judgment, order or decree of any governmental body, agency or court having jurisdiction over the Company or the Guarantor or any of their respective subsidiaries, including without limitation,
pursuant to any Gaming Laws. 




        (d)   The
Initial Purchasers shall have received on the Closing Date an opinion of Latham & Watkins LLP, outside counsel for the Company and the Guarantor, dated the
Closing Date, to the effect that: 



        (i)    this
Agreement has been duly authorized by all necessary corporate action of the Company and the Guarantor, and this Agreement has been duly executed and delivered by
the Company and the Guarantor; 


        (ii)   the
Indenture has been duly authorized by all necessary corporate action of the Company and the Guarantor, and the Indenture has been duly executed and delivered by the
Company and the Guarantor and is the legally valid and binding agreement of the Company and the Guarantor, enforceable against each of them in accordance with its terms; 


        (iii)  the
Registration Rights Agreement has been duly authorized by all necessary corporate action of the Company and the Guarantor, has been duly executed and delivered by
the Company and the Guarantor and is the legally valid and binding agreement of the Company and the Guarantor, enforceable against each of them in accordance with its terms; 



        (iv)  the
Notes have been duly authorized by all necessary corporate action of the Company and, when executed, issued and authenticated in accordance with the terms of the
Indenture and delivered to and paid for by the Initial Purchasers in accordance with the terms of this Agreement, will be the legally
valid and binding obligations of the Company, enforceable against the Company in accordance with their terms; and a registered holder of the Notes will be a beneficiary under the Indenture; 


        (v)   the
notations of Guarantee of the Guarantor to be endorsed on the Notes have been duly authorized by all necessary corporate action of the Guarantor and, when executed
and delivered in accordance with the terms of the Indenture (assuming the due execution, issuance and authentication of the Notes in accordance with the terms of the Indenture and delivery and payment
therefor by you in accordance with the terms of this Agreement), will be the legally valid and binding obligations of the Guarantor, enforceable against the Guarantor in accordance with their terms; 


        (vi)  the
execution and delivery of this Agreement, the Indenture and the Registration Rights Agreement, and the execution, issuance and sale of the Notes and the Guarantees
by each of the Company and the Guarantor, respectively, to the Initial Purchasers pursuant to this Agreement, and the performance by each of the Company and the Guarantor on or prior to the Closing
Date of its respective obligations under this Agreement, the Indenture and the 




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Registration
Rights Agreement required to be performed on or before the Closing Date, do not: 



        (A)  violate
the Company's governing documents or the Guarantor's governing documents, respectively; 



        (B)  violate
the Delaware General Corporation Law, or any federal or New York statute, rule or regulation applicable to the Company or the Guarantor, respectively; or 


        (C)  require
any consents, approvals, or authorizations to be obtained by the Company or the Guarantor, respectively, or any registrations, declarations or filings to be made
by the Company or the Guarantor, respectively, in each case, under any federal or New York statute, rule or regulation applicable to the Company or the Guarantor, respectively, that have not been
obtained or made; 




        (vii) the
statements in the Offering Memorandum under the caption "Description of Notes," insofar as they purport to constitute a summary of the terms of the Notes and the
Guarantee, are accurate descriptions or summaries in all material respects; 


        (viii) no
registration of the Securities under the Securities Act, and no qualification of the Indenture under the Trust Indenture Act is required for the purchase of the
Securities by the Initial Purchasers or the initial resale of the Securities, in each case, in the manner contemplated by this Agreement and the
Offering Memorandum (such counsel may state that it expresses no opinion as to when or under what circumstances the Notes initially sold by you may be offered or resold); 



        (ix)  with
your consent based solely on a certificate of an officer of the Company as to factual matters, neither the Company nor the Guarantor is, and immediately after
giving effect to the offering and sale of the Securities in accordance with the Purchase Agreement and the application of the proceeds as described in the Offering Memorandum under the caption "Use of
Proceeds," neither will be required to be registered as an "investment company" within the meaning of the Investment Company Act; and 


        (x)   based
on such facts and subject to the limitations set forth in the Offering Memorandum, the statements in the Offering Memorandum under the caption "Certain United
States Federal Income Tax Consequences," insofar as they purport to summarize certain provisions of the statutes and regulations referred to therein, are accurate summaries in all material respects. 




        Such
counsel may state that the primary purpose of such counsel's professional engagement was not to establish or confirm factual matters or financial or quantitative information, and
many determinations involved in the preparation of the Offering Memorandum (and the documents incorporated by reference) are of a wholly or partially non-legal character or related to
legal matters outside the scope of such counsel's opinion letter to you of even date herewith. Therefore, such counsel is not passing upon and does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in, or incorporated by reference in, the Offering Memorandum or the incorporated documents (except to the extent expressly set forth in numbered
paragraph 7 above), and have not made an independent check or verification thereof (except as aforesaid). However, in the course of acting as special counsel to the Company and the Guarantor in
connection with the preparation by the Company and the Guarantor of the Offering Memorandum, such counsel reviewed the Offering Memorandum and the incorporated documents, and participated in
conferences and telephone conversations with officers and other representatives of the Company, counsel to the Company, the independent public accountants for the Company, your representatives, and
your counsel, during which conferences and conversations the contents of the Offering Memorandum (and portions of the incorporated documents) and related matters were 



8





 

discussed.
Such counsel also reviewed and relied upon certain corporate records and documents, letters from counsel and accountants, and oral and written statements of officers and other
representatives of the Company and others as to the existence and consequence of certain factual and other matters. Such counsel considered the foregoing in light of such counsel's understanding of
applicable U.S. federal securities laws and such counsel's experience gained through practice thereunder. 



        Based
on such counsel's participation and review as described above, such counsel shall advise you that during the course of such counsel's services in connection with this matter, no
facts came to such counsel's attention that caused such counsel to believe that the Offering Memorandum, together with the incorporated documents, as of its date or as of the date hereof, (together
with the incorporated documents at that date), contained or contains an untrue statement of a material fact or omitted or
omits to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; it being understood that such counsel expresses
no belief with respect to the financial statements, schedules, or other financial data included or incorporated by reference in, or omitted from, the Offering Memorandum or the incorporated documents. 



        The
opinion of Latham & Watkins LLP described in this Section 4(d) shall be rendered to the Initial Purchasers at the request of the Company and the Guarantor and shall so
state therein. 


        (e)   The
Initial Purchasers shall have received from Cleary, Gottlieb, Steen & Hamilton, counsel for the Initial Purchasers, such opinion or opinions, dated the
Closing Date and addressed to the Representative, with respect to the issuance and sale of the Securities, the Indenture, the Registration Rights Agreement, the Offering Memorandum (as amended or
supplemented at the Closing Date) and other related matters as the Representative may reasonably require, and the Company and the Guarantor shall have furnished to such counsel such documents as they
request for the purpose of enabling them to pass upon such matters. 


        (f)    At
the Execution Time and at the Closing Date, Deloitte & Touche LLP shall have furnished to the Initial Purchasers a letter or letters, dated respectively as of
the Execution Time and as of the Closing Date, in form and substance satisfactory to the Initial Purchasers, confirming that they are independent accountants within the meaning of the Act and the
Exchange Act and stating in effect that: 



        (i)    in
their opinion the audited financial statements and financial statement schedules included or incorporated in the Offering Memorandum (as amended or supplemented at
the date of the letter) and reported on by them comply in form in all material respects with the applicable accounting requirements of the Exchange Act and the related published rules and regulations; 


        (ii)   on
the basis of a reading of the latest unaudited financial statements made available by the Company, the Guarantor and its subsidiaries; carrying out certain specified
procedures (but not an examination in accordance with generally accepted auditing standards which would not necessarily reveal matters of significance with respect to the comments set forth in such
letter); a reading of the minutes of the meetings of the stockholders, directors and executive, human resources and audit committees of the Company, the Guarantor and its subsidiaries; and inquiries
of certain officials of the Company and of the Guarantor who have responsibility for financial and accounting matters of the Company, the Guarantor and its subsidiaries as to transactions and events
subsequent to September 30, 2003, nothing came to their attention which caused them to believe that: with respect to the period subsequent to September 30, 2003, there were any changes,
at a specified date not more than five Business Days prior to the date of the letter, in the consolidated long-term debt of the Guarantor or capital stock of the Guarantor or decreases in
the stockholders' equity of the Guarantor as compared with the 




9





 





amounts
shown on the September 30, 2003 consolidated balance sheet included or incorporated in the Offering Memorandum (as amended or supplemented at the date of the letter), or for the period
from September 30, 2003 to such specified date there were any decreases, as compared with the corresponding period in the preceding year in consolidated total revenues or operating income or
income before income taxes or the total or per share amounts of consolidated net income of the Guarantor and its subsidiaries, except in all instances for changes or decreases set forth in such
letter, in which case the letter shall be accompanied by an explanation by the Company as to the significance thereof unless said explanation is not deemed necessary by the Initial Purchasers. 


        (iii)  the
statements and information contained in the letter or letters are of the type ordinarily included in accountants' "comfort letters" to Initial Purchasers with
respect to the financial statements and certain financial information contained in or incorporated by reference into the Offering Memorandum. 




        (g)   Subsequent
to the Execution Time or, if earlier, the dates as of which information is given in the Offering Memorandum, there shall not have been (i) any change
or decrease specified in the letter or letters referred to in paragraph (f) of this Section 4 or (ii) any change, or any development involving a prospective change, in or
affecting the business or properties of the Company and the Guarantor and its subsidiaries the effect of which, in any case referred to in clause (i) or (ii) above, is, in the judgment
of the Initial Purchasers, so material and adverse as to make it impractical or inadvisable to proceed with the offering, sale or delivery of the Securities as contemplated by the Offering Memorandum. 


        (h)   As
of the Closing Date the Securities shall be rated not lower than BBB- by Standard & Poor's Corporation and Baa3 by Moody's Investors
Service, Inc. 


        (i)    The
Securities shall be eligible for clearance and settlement through The Depositary Trust Company. 


        (j)    Prior
to the Closing Date, the Company shall have furnished to the Initial Purchasers such further information, certificates and documents as the Representative may
reasonably request. 




        5.     Covenants of the Company and the Guarantor. In further consideration of the agreements of the Initial Purchasers herein
contained, each of the Company and the Guarantor covenants with each Initial Purchaser as follows that: 



        (a)   The
Company and the Guarantor shall furnish the Representative, without charge, prior to 10:00 a.m. New York City time on the second Business Day next succeeding
the date of this Agreement and during the period mentioned in Section 5(c) below, as many copies of the Offering Memorandum, any documents incorporated by reference therein and any supplements
and amendments thereto as the Representative may reasonably request. 


        (b)   The
Company and the Guarantor shall not amend or supplement the Offering Memorandum without the prior written consent of the Representative, which shall not be
unreasonably withheld or delayed and the Company and the Guarantor shall not file any document under the Exchange Act that is incorporated by reference in the Offering Memorandum unless, prior to such
proposed filing, they have furnished the Representative with a copy of such document for review by the Representative and the Representative has not reasonably objected to the filing of such document.
The Company or the Guarantor, as the case may be, shall promptly advise the Representative when any document filed under the Exchange Act that is incorporated by reference in the Offering Memorandum
shall have been filed with the Commission. 


        (c)   If,
at any time prior to the completion of the sale of the Securities by the Initial Purchasers (as determined by the Representative), any event shall occur or condition
exist as a 



10





 




result
of which it is necessary to amend or supplement the Offering Memorandum in order to make the statements therein, in the light of the circumstances when the Offering Memorandum is delivered to a
purchaser, not misleading, or if, in the opinion of counsel for the Initial Purchasers, it is necessary to amend or supplement the Offering Memorandum to comply with applicable law, forthwith to
notify the Representative of such event or condition and prepare and furnish, at its own expense, to the Initial Purchasers and such other persons as the Initial Purchasers may reasonably request,
either amendments or supplements to the Offering Memorandum (in such quantities as the Initial Purchasers may reasonably request) so that the statements in the Offering Memorandum as so amended or
supplemented will not, in the light of the circumstances when the Offering Memorandum is delivered to a purchaser, be misleading or so that the Offering Memorandum, as amended or supplemented, will
comply with law. 


        (d)   The
Company and Guarantor shall endeavor to qualify the Securities for offer and sale under the securities or Blue Sky laws of such jurisdictions as the Representative
shall reasonably request and
promptly advise the Initial Purchasers of the receipt by the Company or the Guarantor of any notification with respect to the suspension of the qualification of the Securities for sale in any
jurisdiction or the initiation or threatening-of any proceeding for such purpose. 


        (e)   The
Company and Guarantor shall not, and shall not permit any of their Affiliates to, resell any Securities that have been acquired by any of them, except, in the case
of a Controlled Affiliate, until the earlier of (i) the consummation of the Registered Exchange Offer and (ii) the declaration of effectiveness of a Shelf Registration Statement pursuant
to the Registration Rights Agreement. 


        (f)    Neither
the Company, nor the Guarantor, nor any of their respective Affiliates, nor any person acting on behalf of any of the foregoing, will, directly or indirectly,
make offers or sales of any security, or solicit offers to buy any security, under circumstances that would require the registration of the Securities under the Act. 


        (g)   Neither
the Company, nor the Guarantor, nor any of their respective Affiliates, nor any person acting on behalf of any of the foregoing, will engage in any form of
general solicitation or general advertising (within the meaning of Regulation D) in connection with any offer or sale of the Securities in the United States. 



        (h)   So
long as any of the Securities are "restricted securities" within the meaning of Rule 144(a)(3) under the Act, each of the Company and the Guarantor will,
during any period in which it is not subject to and in compliance with Section 13 or 15(d) of the Exchange Act or it is not exempt from such reporting requirements pursuant to and in compliance
with Rule 12g3-2(b) under the Exchange Act, to provide to each holder of such restricted securities and to each prospective purchaser (as designated by such holder) of such
restricted securities, upon the request of such holder or prospective purchaser, any information required to be provided by Rule 144A(d)(4) under the Act. This covenant is intended to be for
the benefit of the holders, and the prospective purchasers designated by such holders, from time to time of such restricted securities. 



        (i)    Neither
the Company, nor the Guarantor, nor any of their respective Affiliates, nor any person acting on behalf of any of the foregoing, will engage in any directed
selling efforts with respect to the Securities, and each of them will comply with the offering restrictions requirement of Regulation S. Terms used in this paragraph have the meanings given to
them by Regulation S. 


        (j)    To
cooperate with the Representative and use its best efforts to permit the Securities to be eligible for clearance and settlement through The Depository Trust Company. 



        (k)   During
the period beginning at the Execution Time and continuing until the date which is 30 days after the Closing Date, not to offer, sell, contract to sell or
otherwise dispose of any debt 



11





 




securities
of the Company or warrants to purchase debt securities of the Company substantially similar to the Securities (other than (i) the Securities and (ii) commercial paper issued
in the ordinary course of business), without the prior written consent of the Representative. 



        (l)    Not
to take, directly or indirectly, any action designed to or which has constituted or which might reasonably be expected to cause or result, under the Exchange Act or
otherwise, in stabilization or manipulation of the price of any security of the Company or the Guarantor to facilitate the sale or resale of the Securities. 


        (m)  Whether
or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated, to pay or cause to be paid all expenses incident to the
performance of the Company's and the Guarantor's obligations under this Agreement, including: 



        (i)    the
fees, disbursements and expenses of the Company's and Guarantor's counsel and the Company's and Guarantor's accountants in connection with the registration and
delivery of the Securities under the Act and all other fees or expenses in connection with the preparation of the Offering Memorandum and amendments and supplements or amendments to either of the
foregoing, including all printing costs associated therewith, and the mailing and delivering of copies thereof to the Initial Purchasers and dealers, in the quantities hereinabove specified, 


        (ii)   all
costs and expenses related to the transfer and delivery of the Securities to the Initial Purchasers, including any transfer or other taxes payable thereon (but
excluding any transfer taxes on resale of any of the Securities by the Initial Purchasers), 


        (iii)  the
cost of printing or producing any Blue Sky or legal investment memorandum in connection with the offer and sale of the Securities under state law and all expenses
in connection with the qualification of the Securities for offer and sale under state law as provided in Section 5(d) hereof, including filing fees and the reasonable fees and disbursements of
counsel for the Initial Purchasers in connection with such qualification and in connection with the Blue Sky or legal investment memorandum, 



        (iv)  the
fees and disbursements of the Company's and Guarantor's counsel and accountants and of the Trustee and its counsel, 


        (v)   any
fees charged by the rating agencies for the rating of the Securities, 


        (vi)  the
costs and expenses of the Company and the Guarantor relating to investor presentations on any "road show" undertaken in connection with the marketing of the
offering of the Securities, including, without limitation, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the
road show presentations with the prior approval of the Company, travel and lodging expenses of the representatives and officers of the Company and the Guarantor and any such consultants, and the cost
of any aircraft chartered in connection with the road show, and 


        (vii) all
other costs and expenses incident to the performance of the obligations of the Company and the Guarantor hereunder for which provision is not otherwise made in
this Section. It is understood, however, that except as provided in this Section, Section 6 entitled "Indemnity and Contribution," and the last paragraph of Section 8 below, the Initial
Purchasers will pay all of their costs and expenses, including fees and disbursements of their counsel, stock transfer payable on resale of the Securities and any advertising expenses connected with
any offers they may make. 




12





 





        6.     Indemnity and Contribution. 



        (a)   The
Company and the Guarantor, jointly and severally, agree to indemnify and hold harmless each Initial Purchaser and each person, if any, who controls any Initial
Purchaser within the meaning of either Section 15 of the Act or Section 20 of the Exchange Act from and against any and all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Offering Memorandum or amendment or supplement thereto (if the Company or the Guarantor shall have furnished any amendments or supplements thereto), or caused by any
omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages
or liabilities are caused by any such untrue statement or omission or alleged untrue statement or omission based upon information relating to any Initial Purchaser furnished to the Company in writing
by such Initial Purchaser through the Representative expressly for use therein. 


        (b)   Each
Initial Purchaser agrees, severally and not jointly, to indemnify and hold harmless the Company and the Guarantor, and each person, if any, who controls the Company
or the Guarantor, respectively, within the meaning of either Section 15 of the Act or Section 20 of the Exchange Act to the same extent as the foregoing indemnity from the Company and
the Guarantor to such Initial Purchaser, but only with reference to information relating to such Initial Purchaser furnished to the
Company in writing by such Initial Purchaser through the Representative expressly for use in the Offering Memorandum or any amendments or supplements thereto. 


        (c)   In
case any proceeding (including any governmental investigation) shall be instituted involving any person in respect of which indemnity may be sought pursuant to either
Section 6(a) or 6(b), such person (the "indemnified party") shall promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing and the indemnifying party, upon request of the indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the indemnifying party may designate in such proceeding and shall pay the fees and disbursements of such counsel related to such
proceeding. In any such proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such indemnified party
unless (i) the indemnifying party and the indemnified party shall have mutually agreed to the retention of such counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that the indemnifying party shall not, in respect of the legal expenses of any indemnified party in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all such indemnified parties and that all such fees and expenses shall
be reimbursed as they are incurred. Such firm shall be designated in writing by the Representative, in the case of parties indemnified pursuant to Section 6(a) above, and by the Company, in the
case of parties indemnified pursuant to Section 6(b) above. The indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent (which consent
shall not be unreasonably withheld), but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and
against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the indemnifying party agrees that it shall be liable 



13





 




for
any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could have been a party
and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the
subject matter of such proceeding. 


        (d)   To
the extent the indemnification provided for in Section 6(a) or 6(b) is unavailable to an indemnified party or insufficient in respect of any losses, claims,
damages or liabilities referred to therein, then each indemnifying party under such paragraph, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable
by such indemnified party as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one
hand and the Initial Purchasers on the other hand from the offering of the Securities or (ii) if the allocation provided by clause 6(d)(i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause 6(d)(i) above but also the relative fault of the Company
and the Guarantor on the one hand and of the Initial Purchasers on the other hand in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Initial Purchasers on the other hand in connection with the offering of the
Securities shall be deemed to be in the same respective proportions as the net proceeds from the offering of such Securities (before deducting expenses) received by the Company and the total
underwriting discounts and commissions received by the Initial Purchasers bear to the aggregate public offering price of the Securities. The relative fault of the Company and the Guarantor on the one
hand and the Initial Purchasers on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company or the Guarantor or by the Initial Purchasers and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Initial Purchasers' respective obligations to contribute pursuant to this Section 6 are several in proportion to the respective
principal amounts of Securities they have purchased hereunder, and not joint. 


        (e)   The
Company, the Guarantor and the Initial Purchasers agree that it would not be just or equitable if contribution pursuant to this Section 6 were determined by
pro rata allocation (even if the Initial Purchasers were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations
referred to in Section 6(d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages and liabilities referred to in the immediately preceding paragraph
shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 6, no Initial Purchaser shall be required to contribute any amount in excess of the amount by which the total price at which the
Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages that such Initial Purchaser has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent misrepresentation. The remedies provided 



14





 




for
in this Section 6 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity. 


        (f)    The
indemnity and contribution provisions contained in this Section 6 and the representations, warranties and other statements of the Company and the Guarantor
contained in this Agreement shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any
Initial Purchaser or any person controlling any Initial Purchaser or the Company or the Guarantor, or their respective officers or directors or any person controlling the Company or the Guarantor,
respectively, and (iii) acceptance of and payment for any of the Securities. 




        7.     Termination. This Agreement shall be subject to termination by notice given by the Representative to the Company, if
(a) after the execution and delivery of the Purchase Agreement and prior to the Closing Date (i) trading generally shall have been suspended or materially limited on or by, as the case
may be, any of the New York Stock Exchange, the American Stock Exchange, the National Association of Securities Dealers, Inc., the Chicago Board of Options Exchange, the Chicago Mercantile
Exchange or the Chicago Board of Trade, (ii) trading of any securities of the Company or the Guarantor shall have been suspended on any exchange or in any
over-the-counter market, (iii) a general moratorium on commercial banking activities in New York shall have been declared by either federal or New York State authorities
or (iv) there shall have occurred any outbreak or escalation of hostilities or any change in financial markets or any calamity or crisis that, in the judgment of the Representative, is material
and adverse and (b) in the case of any of the events specified in clauses 7(a)(i) through 7(a)(iv), such event, individually or together with any other such event, makes it, in the
judgment of the Representative, impracticable or inadvisable to proceed with the offering, sale or delivery of the Securities on the terms and in the manner contemplated in the Offering Memorandum. 



        8.     Defaulting Initial Purchasers. If, on the Closing Date, any one or more of the Initial Purchasers shall fail or refuse to
purchase Securities that it has or they have agreed to purchase hereunder on such date, and the aggregate amount of Securities which such defaulting Initial Purchaser or Initial Purchasers agreed but
failed or refused to purchase is not more than one-tenth of the aggregate amount of the Securities to be purchased on such date, the other Initial Purchasers shall be obligated severally
in the proportions that the amount of Securities set forth opposite their respective names in the Purchase Agreement bears to the aggregate amount of Securities set forth opposite the names of all
such non-defaulting Initial Purchasers, or in such other proportions as the Representative may specify, to purchase the Securities which such defaulting Initial Purchaser or Initial
Purchasers agreed but failed or refused to purchase on such date; provided that in no event shall the amount of Securities that any Initial Purchaser has agreed to purchase pursuant to this Agreement
be increased pursuant to this Section 8 by an amount in excess of one-ninth of such amount of Securities without the written consent of such Initial Purchaser. If, on the Closing
Date, any Initial Purchaser or Initial Purchasers shall fail or refuse to purchase Securities and the aggregate amount of Securities with respect to which such default occurs is more than
one-tenth of the aggregate amount of Securities to be purchased on such date, and arrangements satisfactory to the Representative and the Company for the purchase of such Securities are
not made within 36 hours after such default, this Agreement shall terminate without liability on the part of any non-defaulting Initial Purchaser, the Company or the Guarantor. In
any such case either the Representative or the Company shall have the right to postpone the Closing Date, but in no event for longer than seven days, in order that the required changes, if any, in the
Offering Memorandum or in any other documents or arrangements may be effected. Any action taken under this paragraph shall not relieve any defaulting Initial Purchaser from liability in respect of any
default of such Initial Purchaser under this Agreement. 


        If
this Agreement shall be terminated by the Initial Purchasers, or any of them, because of any failure or refusal on the part of the Company or the Guarantor to comply with the terms or
to fulfill any of the conditions of this Agreement, or if for any reason the Company or the Guarantor shall be 


15





 



unable
to perform its obligations under this Agreement, the Company and the Guarantor will reimburse the Initial Purchasers or such Initial Purchasers as have so terminated this Agreement with respect
to themselves, severally, for all out-of-pocket expenses (including the fees and disbursements of their counsel) reasonably incurred by such Initial Purchasers in connection
with this Agreement or the offering contemplated hereunder. 


        9.     Definitions. The terms which follow, when used in this Agreement, shall have the meanings indicated. 


        "Affiliate" shall have the meaning specified in Rule 501(b) of Regulation D. 



        "Business Day" shall mean any day other than a Saturday, a Sunday or a legal holiday or a day on which banking institutions or trust
companies are authorized or obligated by law to close in The City of New York. 


        "Commission" shall mean the Securities and Exchange Commission. 


        "Controlled Affiliate" means any person or entity that is directly, or indirectly through one or more intermediaries, controlled by the
Company, the Guarantor, or both. 


        "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated
thereunder. 


        "Execution Time" shall mean, the date and time that this Agreement is executed and delivered by the parties hereto. 


        "Gaming Laws" means any foreign, federal, state or local law and the rules and regulations thereunder and any similar laws and regulations
governing any aspect of legalized gambling in any foreign, federal, state or local jurisdiction in which the Company or the Guarantor or any of their respective subsidiaries conducts business. 


        "Investment Company Act" shall mean the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission
promulgated thereunder. 


        "Registered Exchange Offer" shall have the meaning ascribed thereto by the Registration Rights Agreement. 


        "Regulation D" shall mean Regulation D under the Act. 


        "Regulation S" shall mean Regulation S under the Act. 


        "Securities Act" shall mean the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated
thereunder. 


        "Shelf Registration Statement" shall have the meaning ascribed thereto by the Registration Rights Agreement. 



        "Trust Indenture Act" shall mean the Trust Indenture Act of 1939, as amended, and the rules and regulations of the Commission promulgated
thereunder. 


        10.   Counterparts. This Agreement may be signed in two or more counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument. 


        11.   Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York
applicable to contracts made and to be performed within the State of New York. 



        12.   Headings. The headings of the sections of this Agreement have been inserted for convenience of reference only and shall
not be deemed a part of this Agreement. 


16






  



EXHIBIT A  


 
 

Selling Restrictions for Offers and
  Sales outside the United States    
    


        (1)(a) The
Securities have not been and will not be registered under the Act and may not be offered or sold within the United States or to, or for the account or benefit of,
U.S. persons except in accordance with Regulation S under the Act or pursuant to an exemption from the registration requirements of the Act. Each Initial Purchaser represents and agrees that,
except as otherwise permitted by Section 3(a)(i) of the Agreement to which this is an exhibit, it has offered and sold the Securities, and will offer and sell the Securities,
(i) as part of their distribution at any time; and (ii) otherwise until 40 days after the later of the commencement of the offering and the Closing Date, only in accordance with
Rule 903 of Regulation S under the Act. Accordingly, each Initial Purchaser represents and agrees that neither it, nor any of its Affiliates nor any person acting on its or their behalf
has engaged or will engage in any directed selling efforts with respect to the Securities, and that it and they have complied and will comply with the offering restrictions requirement of
Regulation S. Each Initial Purchaser agrees that, at or prior to the confirmation of sale of Securities (other than a sale of Securities pursuant to Section 3(a)(i) of the
Agreement to which this is an exhibit), it shall have sent to each distributor, dealer or person receiving a selling concession, fee or other remuneration that purchases Securities from it during the
distribution compliance period a confirmation or notice to substantially the following effect: 




"The
Securities covered hereby have not been registered under the U.S. Securities Act of 1933 (the "Securities Act") and may not be offered or sold
within the United States or to, or for the account or benefit of, U.S. persons (i) as part of their distribution at any time or (ii) otherwise until 40 days after the later of the
commencement of the offering and December 11, 2003, except in either case in accordance with Regulation S or Rule 144A under the Act. Terms used above have the meanings given to
them by Regulation S." 




        (b)   Each
Initial Purchaser also represents and agrees that it has not entered and will not enter into any contractual arrangement with any distributor with respect to the
distribution of the Securities, except with its Affiliates or with the prior written consent of the Company. 


        (c)   Terms
used in this section have the meanings given to them by Regulation S. 


        (2)   Each
Initial Purchaser represents, warrants and agrees that: 


        (a)   it
has not offered or sold and, prior to the date six months after the Closing Date, will not offer or sell any Securities to persons in the United Kingdom except to
persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their businesses or otherwise in circumstances
which have not resulted and will not result in an offer to the public in the United Kingdom within the meaning of the United Kingdom Public Offers of Securities Regulations 1995 (as amended); 



        (b)   it
has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity
(within the meaning of Section 21 of the United Kingdom Financial Services and Markets Act 2000 (the "FSMA")) received by it in connection with
the issue or sale of any Securities in circumstances in which Section 21(1) of the FSMA does not apply to the Company; and 


        (c)   it
has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the Securities in, from or otherwise
involving the United Kingdom. 



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