<PAGE>
                                                                  Exhibit 10.1









                              TRIBAL-STATE COMPACT
                       FOR REGULATION OF CLASS III GAMING
             ON THE MISSISSIPPI BAND OF CHOCTAW INDIANS RESERVATION
                                 IN MISSISSIPPI



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                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>                                                                                                            <C>
SECTION 1.        TITLE...........................................................................................2

SECTION 2.        FINDINGS........................................................................................2

SECTION 3.        DECLARATION OF POLICY...........................................................................3
         3.1      Common Concerns.................................................................................3
         3.2      Positive Tribal Impacts.........................................................................3
         3.3      Positive State Impacts..........................................................................3
         3.4      Protection of Citizens..........................................................................3
         3.5      Fairness........................................................................................3

SECTION 4.        DEFINITIONS.....................................................................................4

SECTION 5.        JURISDICTION....................................................................................8
         5.1      Allocation of Jurisdiction......................................................................8
         5.2      Cross Deputization..............................................................................9
         5.3      No Grant of General Jurisdiction to State.......................................................9

SECTION 6.        CLASS III GAMING................................................................................9
         6.1      Compliance with Compact and IGRA................................................................9
         6.2      Inspectors.....................................................................................10
         6.3      Reporting of Violations........................................................................10
         6.4      Quarterly Meetings.............................................................................11

SECTION 7.        REGULATORY STANDARDS FOR CLASS III GAMES.......................................................12
         7.1      Common Interest................................................................................12
         7.2      Minimum Age for Players........................................................................12
         7.3      Inspection by State............................................................................12
         7.4      Posting of Table Game Rules....................................................................13
         7.5      Regulations Governing Class III Gaming.........................................................14
         7.6      Class III Net Revenues.........................................................................14
         7.7      Exclusion of Persons...........................................................................14

SECTION 8.        LICENSES, WORK PERMITS AND BACKGROUND INVESTIGATIONS OF EMPLOYEES AND MANAGERS.................16
         8.1      Confidential Records...........................................................................16
         8.2      Licenses and Work Permits Required.............................................................17
         8.3      Application Process for Class III Gaming Licenses; Background Investigations...................19
         8.4      Application for Class III Gaming Work Permit; Procedure........................................20
         8.5      Automatic Disqualification for or Revocation of License or Work Permit.........................21
         8.6      Denial, Suspension or Revocation Based Upon Written Findings...................................22
         8.7      Discipline of Employees and Licensees..........................................................22
         8.8      Employee Gaming................................................................................23

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         8.9      Paying Players.................................................................................23
         8.10     Management Contract with Licensed Contractor...................................................23

SECTION 9.        COST OF OVERSIGHT REGULATION, ENFORCEMENT, IMPROVEMENTS AND PROMOTION..........................24
         9.1      Expense Reimbursement..........................................................................24
         9.2      Promotion of Tourism...........................................................................25

SECTION 10.       DISPUTE RESOLUTION.............................................................................26

SECTION 11.       RESERVATION OF RIGHTS UNDER THE IGRA...........................................................27

SECTION 12.       ALCOHOLIC BEVERAGE LICENSE.....................................................................28

SECTION 13.       SEVERABILITY...................................................................................28

SECTION 14.       NOTICES........................................................................................28

SECTION 15.       EFFECTIVE DATE AND DURATION....................................................................29
         15.1     Effective Date.................................................................................29
         15.2     Duration.......................................................................................29

SECTION 16.       AMENDMENTS.....................................................................................29

SECTION 17.       ENTIRE AGREEMENT; SUCCESSORS AND ASSIGNS.......................................................29

SECTION 18.       GOVERNING LAW..................................................................................30

SECTION 19.       JUDICIAL ENFORCEMENT...........................................................................30

SECTION 20.       AUTHORITY TO EXECUTE...........................................................................30
</TABLE>

                                       ii

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EXHIBIT A -  Restated Title XV of Tribal Code, Chapters 1 and 3

EXHIBIT B -  Choctaw Gaming Commission Regulations Governing the Conduct of
             Class III Gaming


                                       iii
<PAGE>

                              TRIBAL-STATE COMPACT
                       FOR REGULATION OF CLASS III GAMING
             ON THE MISSISSIPPI BAND OF CHOCTAW INDIANS RESERVATION
                                 IN MISSISSIPPI


WHEREAS, the State of Mississippi (hereinafter "State") and the Mississippi Band
of Choctaw Indians, a federally recognized Indian tribe organized under the
Indian Reorganization Act of 1934, (hereinafter "Tribe") are separate
sovereigns, and each respects the laws of the other sovereign; and

WHEREAS, the Congress of the United States has enacted the Indian Gaming
Regulatory Act (hereinafter "IGRA"), Public Law 100-497, 102 Stat. 2467, 25
U.S.C. Sections 2701 to 2721, creating a mechanism through which the State and
the Tribal governments may allocate jurisdiction and control of gaming
activities which occur within the federally recognized boundaries of land
wherein exclusive jurisdiction is vested in a Tribal government; and

WHEREAS, the State permits and regulates certain gaming activities within the
State (but outside Tribal lands) pursuant to the powers established by Sections
97-33-1 et. seq. and Sections 75-76-1 et. seq. of the Mississippi Code of 1972,
as amended; and

WHEREAS, the Tribe, exercising powers of self-government as set forth in the
Tribal Constitution adopted under the Indian Reorganization Act, 25 U.S.C. 476,
and acting by and through its duly organized Tribal council, has enacted (i)
Ordinance No. 40 authorizing Class III (Casino-Type) gaming activities on Tribal
lands pursuant to rules and regulations contained in the Tribal-State of Compact
and (ii) Resolution CHO-1-93 authorizing the Tribal Chief and the
Secretary-Treasurer to negotiate and execute with the State a Compact to
allocate jurisdiction and control of these gaming activities and (iii) Ordinance
No. 16-R amending the Tribal Code to create the Choctaw Gaming Commission; and

<PAGE>

WHEREAS, the IGRA requires that the State negotiate in good faith with the Tribe
to develop a Tribal-State Compact for Class III gaming on Tribal lands; and

WHEREAS, the Tribe and the State mutually agree that the conduct of Class III
gaming under the terms and conditions set forth below will benefit and protect
the citizens of the Tribe and the State, consistent with the objective and
requirements of the IGRA;

NOW THEREFORE, in consideration of the mutual undertakings and agreements
hereinafter set forth, the Tribe and the State enter into the following
intergovernmental Compact.

SECTION 1. TITLE

This document shall be referred to as the "Tribal-State Compact for Regulation
of Class III Gaming on the Mississippi Band of Choctaw Indians Reservation in
Mississippi".

SECTION 2. FINDINGS

As the basis for this Compact, the Tribe and the State have made the following
findings:

         2.1      A principal goal of Federal Indian policy is to promote tribal
                  economic development, tribal self-determination and strong
                  tribal government;

         2.2      The Tribe and the State find it to be consistent with the
                  IGRA, and the public health, safety and welfare, to regulate
                  Class III Gaming pursuant to this Compact.

         2.3      The Tribe has the right to license and regulate gaming
                  activity on Tribal lands in accordance with the IGRA and this
                  Compact.

         2.4      The Compact shall govern the licensing, regulation, and
                  operation of Tribal Class III Gaming conducted on Tribal lands
                  located within the State.

         2.5      The Compact will provide the Tribe with the opportunity and
                  responsibility to operate Class III Gaming in a way that will
                  benefit the Tribe economically, ensure fair operation of the
                  games, and minimize the possibilities of corruption and
                  infiltration by criminal influences.

                                      2
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SECTION 3. DECLARATION OF POLICY

         3.1      COMMON CONCERNS. The Tribe and the State, through this Compact
                  shall attempt, in good faith, to address the legitimate common
                  concerns of both parties.

         3.2      POSITIVE TRIBAL IMPACTS. The State recognizes the positive
                  impacts that gaming may provide to the Tribe. The Tribe will
                  utilize revenues generated by gaming to fund programs that
                  provide various vital services to Tribal members. These
                  programs may include education, health and human resources,
                  housing development, road construction and maintenance, sewer
                  and water projects and economic development, tribal
                  administration or any other purpose authorized under the IGRA.

         3.3      POSITIVE STATE IMPACTS. The State recognizes that the positive
                  economic effects of such gaming enterprises may extend beyond
                  Tribal lands to the Tribe's neighbors and surrounding
                  communities, and may help to foster mutual respect and
                  understanding among Indians and non-Indians.

         3.4      PROTECTION OF CITIZENS. The Tribe and the State want to
                  protect their citizens from any criminal involvement in the
                  gaming activities regulated under this Compact.

         3.5      FAIRNESS. This Compact is intended to assure that Class III
                  Gaming is conducted fairly and honestly by the Tribe, its
                  contractors and employees and the players.

SECTION 4. DEFINITIONS

The provisions of the Compact relating to definitions, tense, number and gender
apply and govern the interpretation of the Compact, except when otherwise
plainly declared or clearly apparent from the context.

                                      3

<PAGE>

         4.1      "CARD GAME" means a game that is defined as a Class II game in
                  the IGRA in which the Casino operator is not a party to wagers
                  and from which the Casino operator receives compensation in
                  the form of a rake-off, a time buy-in, or other fee or payment
                  from a player for the privilege of playing, and includes but
                  is not limited to the following: poker, bridge, whist, solo
                  and panguingui.

         4.2      "CASINO" means one or more rooms or buildings wherein Class
                  III Gaming is conducted and includes any bar, cocktail lounge,
                  or other facilities housed therein as well as the area
                  occupied by the games.

         4.3      CHOCTAW GAMING COMMISSION" means the regulatory body created
                  by Tribal Ordinance No. 16-R for regulation of gaming activity
                  on Tribal land.

         4.4      "CLASS III GAMING" means all gaming that is not Class I or
                  Class II gaming as defined in the IGRA and which is regulated
                  under the terms of this Compact.

         4.5      "EQUIPMENT" means any mechanical or electronic contrivance,
                  component or machine used remotely or directly in connection
                  with gaming or any game that would not otherwise be classified
                  as a Gaming Device, including dice, playing cards, links which
                  connect to progressive slot machines, devices which affect the
                  proper reporting of gross revenue, satellite transmission and
                  receival devices, computerized systems of betting at a race
                  book or sports pool, computerized systems for monitoring slot
                  machines and devices for weighing or counting money.

         4.6      "FUNDS" AND "REVENUE" means money or any other thing of value.

         4.7      "GAME" AND "GAMBLING GAME" means any game played with cards,
                  dice, equipment or any mechanical or electronic device or
                  machine for money, property, checks, credit or any
                  representative of value, including, without limiting

                                       4
<PAGE>

                  the generality of the foregoing, faro, monte, roulette, keno,
                  bingo, fan-tan, twenty-one, blackjack, seven-and-a-half, big
                  injun, klondike, craps, poker, chuck-a-luck, chinese
                  chuck-a-luck (dai shu), wheel of fortune, chemin de fer,
                  baccarat, pai gow, beat the banker, panguingui, slot machine,
                  and any other banking or percentage game. In addition,
                  parimutuel wagering, race book and sports pools shall be
                  considered allowable games hereunder only if such games are
                  allowed under the laws of the State.

         4.8      "GAMING" AND "GAMBLING" means to deal, operate, carry on,
                  conduct, maintain or expose for play any game as defined in
                  Section 4.7.

         4.9      "GAMING DEVICE" means any equipment or mechanical or
                  electronic contrivance, component or machine used remotely or
                  directly in connection with Gaming or any Game which affects
                  the result of a wager by determining win or loss. The term
                  includes a system for processing information which can alter
                  the normal criteria of random selection, which affects the
                  operation of any game or which determines the outcome of a
                  game.

         4.10     "GAMING EMPLOYEE" means any person employed directly by the
                  Tribe or its authorized agent to conduct any Game, including:
                  boxmen; cashiers; change personnel; counting room personnel;
                  dealers; employees of manufacturers or distributors of gaming
                  equipment within this State whose duties are directly involved
                  with the manufacture, repair or distribution of gaming
                  equipment in the Casino; employees of operators of slot routes
                  who have keys for slot machines or who accept and transport
                  revenue from the slot drop; floormen; hosts or other person
                  empowered to extend credit or complimentary services; keno
                  runners: keno writers; machine mechanics; odds makers and line
                  setters; security

                                       5
<PAGE>

                  personnel; shift or pit bosses; shills; supervisors or
                  managers; and ticket writers. "Gaming employee" does not
                  include bartenders, cocktail waitresses or other persons
                  engaged in preparing or serving food or beverages.

         4.11     "INDIAN  GAMING  REGULATORY  ACT OR "IGRA" means Public Law
                  100-497,  102 Stat.  2467,  25 U.S.C. Sections 2701 to 2721
                  (1988), as it may be amended from time to time.

         4.12     "MISSISSIPPI GAMING COMMISSION" through September 30, 1993
                  means the State Tax Commission, and thereafter means the
                  Mississippi Gaming Commission established pursuant to the
                  Mississippi Gaming Control Act found in Title 75, Chapter 76
                  of the Mississippi Code of 1972, as amended.

         4.13     "NATIONAL INDIAN GAMING COMMISSION" means the commission
                  established pursuant to the IGRA if such commission is
                  operating pursuant to its promulgated rules and regulations,
                  and prior to such time, shall mean the Secretary.

         4.14     "PAY OUT" means:

                  1.       Money, tokens, credit to a player's account, and the
                           actual cost to the Tribe's Casino operation of
                           personal property, other than travel expenses, food,
                           refreshments, lodging, or services, distributed to a
                           player as the result of a legitimate wager; and

                  2.       Cash Paid directly to an independent financial
                           institution by the Tribe's Casino operations for the
                           purchase of an annuity designed to pay a player's
                           winnings over several years.

         4.15     "PARIMUTUEL SYSTEM OF WAGERING" means any system which whereby
                  wagers with respect to the outcome of a race or other sporting
                  events are placed in a wagering

                                       6
<PAGE>

                  pool conducted by the Tribe and in which the participants
                  are wagering with each other and not against the operator.
                  The term includes off-site pari-mutuel wagering. It is
                  agreed that gaming utilizing the parimutuel system of
                  wagering shall be allowable games as defined in Section 4.7
                  herein only if such parimutuel system of wagering is
                  allowed on non-Tribal lands under the laws of the State.

         4.16     "PREMISES" means land together with all buildings,
                  improvements and personal property located thereon.

         4.17     "PROGRESSIVE KENO GAME" means a game with a payoff limit that
                  increases by a predetermined amount as the game is played,
                  which limit is at all times exhibited on an indicator visible
                  to the public. "Progressive keno game" includes video
                  progressive keno devices.

         4.18     "RAKE-OFF" means a percentage of the total amount anted and
                  wagered by players during a hand in a card game.

         4.19     "SECRETARY" means the Secretary of the U.S. Department of
                  Interior.

         4.20     "SLOT MACHINE" means any mechanical, electrical or other
                  device, contrivance or machine which, upon insertion of a
                  coin, token or similar object, or upon payment of any
                  consideration, is available to play or operate, the play or
                  operation of which, whether by reason of the skill of the
                  operator in playing a gambling game which is presented for
                  play by the machine or application of the element of chance,
                  or both, may deliver or entitle the person playing or
                  operating the machine to receive cash, premiums, merchandise,
                  tokens or any thing of value, whether the payoff is made
                  automatically from the machine or in any other manner.

                                       7
<PAGE>

         4.21     "SPORTS POOL" means the business of accepting wagers on
                  sporting events by any system or method of wagering other than
                  the system known as the parimutuel method of wagering;
                  provided, however, that such wagers shall be allowable gaming
                  under this Compact only if such wagers are allowed on
                  non-Tribal lands under the laws of the State.

         4.22     "STATE" means the State of Mississippi.

         4.23     "TRIBE" means the Mississippi Band of Choctaw Indians.

         4.24     "TRIBAL CHIEF" means the principal executive officer of the
                  Tribe.

         4.25     "TRIBAL COUNCIL" means the governing body of the Tribe.

         4.26     "TRIBAL LAND" means all lands within the limits of the
                  Mississippi Band of Choctaw Indians' federally recognized
                  reservation and shall be synonymous with the term "Indian
                  lands" as used in IGRA.

         4.27     "VIDEO GAMES OF CHANCE" means electronic video devices that
                  simulate games commonly referred to as poker, blackjack,
                  craps, hi-lo, roulette, or which line-up symbols and numbers,
                  or other common gambling forms, which are activated by the
                  insertion of a coin, token, or currency, and which award game
                  credits, cash, tokens or replays, and contain a meter or
                  device to record unplayed credits or replays.

SECTION 5. JURISDICTION

         5.1      ALLOCATION OF JURISDICTION. For purposes of regulating Class
                  III Gaming and enforcing the requirements of this Compact, (i)
                  the Tribe shall exercise exclusive criminal and civil
                  jurisdiction over Tribal members and all other Native
                  Americans, to the extent allowed by federal law; (ii) the
                  Tribe and the State shall exercise concurrent civil
                  jurisdiction over the Class III Gaming activities as set

                                       8
<PAGE>

                  forth in this Compact; and (iii) the State shall exercise
                  exclusive criminal jurisdiction over non-Indians; provided
                  however, that nothing contained in this Compact shall be
                  deemed to modify or limit federal criminal and civil
                  jurisdiction as provided by federal law over the Class III
                  operations authorized under this Compact. The Tribe shall
                  maintain its own security force which will have primary law
                  enforcement responsibilities on the premise.

         5.2      CROSS DEPUTIZATION. The parties hereto, to the extent
                  permitted by law, agree to enter into cross deputization
                  agreements as may be necessary and proper to facilitate the
                  enforcement of the civil and criminal jurisdiction recognized
                  under the Compact.

         5.3      NO GRANT OF GENERAL JURISDICTION TO STATE. Nothing contained
                  in this Compact grants, or shall be construed to grant, to the
                  State or any agency, department of commission thereof, general
                  state civil regulatory or taxing authority, or criminal
                  jurisdiction, over the Tribe or its lands, property, members
                  or activities, except as expressly authorized under this
                  Compact.

SECTION 6. CLASS III GAMING

         6.1      COMPLIANCE WITH COMPACT AND IGRA. The Tribe is authorized to
                  own and operate one or more Casinos for the purpose of
                  conducting Class III Gaming on Tribal Lands, provided that
                  such Class III Gaming, is conducted in accordance with the
                  terms of this Compact and the IGRA. It is recognized and
                  agreed that no Class III Gaming shall be conducted by the
                  Tribe on lands newly acquired by the Secretary in trust for
                  the benefit of the Tribe after October 17, 1988, unless
                  located within or contiguous to the existing boundaries of the
                  Tribe's reservation as of October 17, 1988 and if the
                  Secretary, after consultation with local officials,

                                       9
<PAGE>

                  as required by 25 U.S.C. Section 2719, determines that such
                  Gaming on newly acquired lands would be in the Tribe's best
                  interest and would not be detrimental to the surrounding
                  community, but only if the Governor of Mississippi concurs in
                  such determination. The primary responsibility for the on-site
                  regulation, control and security of the Gaming operation
                  authorized by this Compact, and for the enforcement of this
                  Compact, shall be that of the Choctaw Gaming Commission.

         6.2      INSPECTORS. The Choctaw Gaming Commission shall employ
                  qualified inspectors or agents under the authority of the
                  Choctaw Gaming Commission. Said inspectors shall be
                  independent of the Tribal Gaming operation, and shall be
                  supervised and accountable only to the Choctaw Gaming
                  Commission.

         6.3      REPORTING OF VIOLATIONS. A Choctaw Gaming Commission inspector
                  shall be present in the Casino during all hours of Gaming
                  operation, and shall have immediate access to any and all
                  areas of the Class III Gaming operation for the purpose of
                  ensuring compliance with the provisions of this Compact and
                  Tribal Ordinances. Any violation(s) of the provisions of this
                  Compact, or of Tribal Gaming Ordinances by a management
                  contractor, a Gaming employee, or any person on the Casino
                  premises whether or not associated with the Tribal Gaming
                  operation shall be reported immediately to the Choctaw Gaming
                  Commission. The Choctaw Gaming Commission shall forward copies
                  of all completed investigation reports and final dispositions
                  to the Mississippi Gaming Commission on a continuing basis. If
                  requested by the Choctaw Gaming Commission, the Mississippi
                  Gaming Commission shall assist in any investigation initiated
                  by the Choctaw Gaming Commission, and provide other requested
                  services to ensure proper compliance with the provisions of
                  this

                                       10
<PAGE>

                  Compact, Tribal Gaming Ordinances, laws of the Tribe, or
                  applicable federal laws.

         6.4      QUARTERLY MEETINGS. In order to develop and foster a positive
                  and effective relationship in the enforcement of the
                  provisions of this Compact and to keep the Choctaw Gaming
                  Commission and the Mississippi Gaming Commission informed as
                  to both of their separate Class III Gaming regulatory actions,
                  representatives of the Choctaw Gaming Commission and the
                  Mississippi Gaming Commission shall meet, not less than on a
                  quarterly basis, to review past practices and activities
                  during the preceding calendar quarter of the separate Class
                  III Gaming regulatory programs of the Tribe and the State. The
                  meetings shall take place at a location selected by the
                  Choctaw Gaming Commission. The Mississippi Gaming Commission
                  prior to or during such meetings shall disclose to the Choctaw
                  Gaming Commission any concerns, suspected activities or
                  pending matters reasonably believed to possibly constitute
                  violations of this Compact by any person, organization or
                  entity.

SECTION 7. REGULATORY STANDARDS FOR CLASS III GAMES

         7.1      COMMON INTEREST

                  (1)      In recognition of the valid public policy interests
                           of the State and the Tribe, regulatory standards are
                           hereby established for Class III Gaming operated and
                           played within Tribal lands.

                  (2)      The Choctaw Gaming Commission shall adopt and
                           maintain, at all times during which the Tribe
                           conducts any authorized Class III Games, regulations
                           at least as restrictive as those set forth herein.

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<PAGE>

                  (3)      Nothing in this Section shall limit the rights or
                           remedies  available  to the parties under the IGRA.

         7.2      MINIMUM AGE FOR PLAYERS

                  No person below the age of 21 on the date of Gaming shall be
                  permitted to play any Class III Game. If any person below the
                  age of 21 plays and otherwise qualifies to win any Class III
                  Game which requires notice and payout by the operator of the
                  facility, the prize shall not be paid, and the estimated
                  amount wagered during the course of the game shall be returned
                  to the minor. Nothing in this Section 7.2 shall be deemed to
                  limit civil fines, penalties and other remedies against
                  licensees or employees pursuant to Section 8.8 herein.

         7.3      INSPECTION BY STATE

                  (1)      The Choctaw Gaming Commission shall have the right to
                           conduct or cause to be conducted announced or
                           unannounced inspections of all Gaming operations to
                           ensure compliance with this Compact, Title XV of the
                           Tribal Code, and all other applicable Tribal and
                           federal laws and regulations, as amended from time to
                           time.

                  (2)      Agents of the Mississippi Gaming Commission or their
                           designated representatives, upon the presentation of
                           appropriate identification to the on-site Choctaw
                           Gaming Commission official, shall also have the right
                           to gain access, without notice during normal business
                           hours, to all premises used for the operation of
                           Class III Gaming or the storage of Class III Gaming
                           equipment related thereto, and may inspect all Casino
                           premises, equipment, or equipment maintenance
                           records, in order to verify compliance with the
                           provisions of this Compact. Inspections made

                                       12
<PAGE>

                           pursuant to this Section shall not be conducted in
                           a manner which disrupts normal business
                           operations. At the completion of any inspection by
                           the Mississippi Gaming Commission, copies of any
                           investigative or inspection report shall be
                           promptly sent to the Choctaw Gaming Commission.

         7.4      POSTING OF TABLE GAME RULES

                  The name and rules of each table game shall be posted and be
                  clearly legible at or near each table in the Casino and must
                  designate:

                  (1) The maximum rake-off percentage, time buy-in, or other fee
                  charged;

                  (2) The number of raises allowed;

                  (3) The monetary limit of each raise;

                  (4) The amount of ante;

                  (5) Other rules as may be necessary.

         7.5      REGULATIONS GOVERNING CLASS III GAMING

                  Attached hereto and incorporated by this reference are Exhibit
                  A (Tribal Code, Restated Title XV, Chapters 1 and 3) and
                  Exhibit B (Gaming Conduct Regulations) governing the conduct
                  of Class III Gaming under this Compact). The regulations
                  attached as Exhibit B may be modified or amended by the
                  Choctaw Gaming Commission, provided that no amendment to the
                  attached regulations shall be effective unless approved by the
                  Tribal Council and the Mississippi Gaming Commission, with
                  approval not to be unreasonably withheld. The Choctaw Gaming
                  Commission shall also have authority to adopt additional
                  supplemental regulations consistent with this Tribal-State
                  Compact, provided that the Tribal Council and the Mississippi
                  Gaming Commission shall receive prior

                                       13
<PAGE>

                  written notice of such supplemental regulations which shall
                  become effective upon approval by the Tribal Council.

         7.6      CLASS III NET REVENUES

                  (1)      Net revenues to the tribe from Class III operations
                           shall be used to fund tribal government operations or
                           programs, to provide for the general welfare of the
                           members of the tribe, to promote economic
                           development, to donate to charitable organizations,
                           or to help fund the operations of local government
                           agencies, and shall be expended only in accordance
                           with budgets adopted by resolution of the Tribal
                           Council.

                  (2)      Class III revenues shall not be used to make per
                           capita payments.

         7.7      EXCLUSION OF PERSONS

                  (1)      No person placed on an exclusion list by the Choctaw
                           Gaming Commission shall be permitted entry into any
                           portion of a Casino. The Choctaw Gaming Commission
                           shall maintain a list of persons to be ejected or
                           excluded from licensed Class III establishments. The
                           list shall be distributed to the Mississippi Gaming
                           Commission and to Tribal law enforcement agencies.
                           The Mississippi Gaming Commission shall likewise
                           furnish the Choctaw Gaming Commission with its
                           separately maintained exclusion list. The following
                           information, to the extent known, shall be provided
                           for each excluded person:

                           (a) The full name and date of birth and all aliases;

                           (b) A physical description;

                           (c) The effective date the person's name was placed
                               on the list;

                           (d) A photograph, if available; and

                                       14
<PAGE>

                           (e) The person's occupation and his current home and
                               business address; and

                           (f) The stated reason for the exclusion.

                  (2)      The Choctaw Gaming Commission may place a person on
                           the exclusion list pending a hearing if such person
                           has:

                           (a)      Been convicted of a felony in any
                                    jurisdiction, of any crime of moral
                                    turpitude or of a crime involving Gaming:

                           (b)      Violated or conspired to violate the
                                    provisions of the IGRA or this Compact
                                    relating to involvement in Gaming without
                                    required licenses, or willful evasion of
                                    fees or taxes;

                           (c)      A notorious or unsavory reputation which
                                    adversely affects public confidence and
                                    trust in Gaming; or

                           (d)      Their name on any valid and current
                                    exclusion list from another jurisdiction in
                                    the United States.

                  (3)      Upon a determination by the Choctaw Gaming Commission
                           that a person comes under any one of the criteria
                           listed in this section, such person may be placed on
                           an exclusion list. Such excluded person shall be
                           notified of the availability of a hearing by the
                           Choctaw Gaming Commission.

                  (4)      Any person who has been placed on any exclusion list
                           may petition the Choctaw Gaming Commission in writing
                           and request that their name be removed from the list.

                  (5)      If the Commission or a subsequent tribal court of
                           review finds in favor of the excluded person, then
                           their name shall be removed from the exclusion

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<PAGE>

                           list and their exclusion shall be terminated as of
                           the date of the action by the Commission or the
                           court.

                           The Choctaw Gaming Commission shall provide
                           prompt written notification to the Mississippi
                           Gaming Commission of the action to terminate the
                           exclusion. This notification also shall include
                           the reason for the reinstatement action.


SECTION 8. LICENSES, WORK PERMITS AND BACKGROUND INVESTIGATIONS OF EMPLOYEES
           AND MANAGERS

         8.1      CONFIDENTIAL RECORDS

                  (1)      The Choctaw Gaming Commission shall maintain a file
                           listing all applications for Class III Gaming
                           licenses and work permits and a record of all its
                           actions on such applications, and such records shall
                           not be confidential. The Tribe shall place the
                           privacy and false statement notices on all
                           applications for licenses and work permits in forms
                           required by the regulations promulgated in accordance
                           with the IGRA.

                  (2)      Confidential information shall include (1) records
                           and financial data acquired by the Choctaw Gaming
                           Commission in carrying out its background
                           investigations of potential Gaming entities, managers
                           and key employees; (2) the identity of persons
                           interviewed during the course of such investigations;
                           and (3) proprietary financial data. Except as
                           otherwise provided herein, confidential information
                           is prohibited from public disclosure by the Choctaw
                           Gaming Commission, the Mississippi Gaming Commission
                           or by individual members of either commission.
                           Confidential or proprietary records, in whole or in
                           part, shall not be

                                       16
<PAGE>

                           included as sections of or attachments to budget
                           documents, annual reports, minutes or audit
                           findings by either the Choctaw Gaming Commission
                           or the Mississippi Gaming Commission. Copies of
                           confidential or proprietary records may be
                           forwarded to the National Indian Gaming Commission
                           upon the written request of that agency or in
                           compliance with the appropriate reporting
                           requirements of the IGRA.

         8.2      LICENSES AND WORK PERMITS REQUIRED

                  (1)      No entity or person shall enter into a binding
                           management contract for operation and management of
                           Class III Gaming with the Tribe or shall be hired as
                           a management official or key employee of a Class III
                           Gaming enterprise, unless such entity or person is
                           the holder of a Class III Gaming license issued by
                           the Choctaw Gaming Commission. The Choctaw Gaming
                           Commission shall provide prompt notification to the
                           Tribal Chief, the National Indian Gaming Commission,
                           and the Mississippi Gaming Commission of any such
                           Class III Gaming licenses. Separate licenses will be
                           required for each place or location where Gaming is
                           conducted.

                  (2)      Persons not required to be licensed as management
                           officials or key employees shall not be employed to
                           work in a Class III Gaming enterprise, unless such
                           person is the holder of a Class III Gaming work
                           permit issued by the Choctaw Gaming Commission.

                  (3)      For purposes of this Tribal-State Compact, a "key
                           employee" shall include a Class III Gaming employee
                           of the Tribe or a Tribal Class III Gaming licensee
                           (1) having the power to exercise any significant
                           influence over decisions concerning any part of the
                           operation, administration,

                                       17
<PAGE>

                           supervision, or physical security activities of
                           Gaming activities or (2) who receives a base
                           salary from the Casino operator in excess of
                           $30,000 per year. Without limiting the foregoing,
                           any individual who has authority to hire or fire
                           other Gaming employees or who is considered a "key
                           employee" under regulations adopted by the
                           National Indian Gaming Commission shall be
                           considered to be a "key employee" of a Gaming
                           enterprise.

                  (4)      While on duty in a Casino, all licensed management
                           officials, key employees, and permitted employees
                           shall wear identification badges, including a
                           photograph, title, license or permit number,
                           signature and zones within the Casino to which he or
                           she is permitted access. Undercover security
                           personnel may be exempted from the display
                           requirements of this paragraph.

         8.3      APPLICATION PROCESS FOR CLASS III GAMING LICENSES; BACKGROUND
                  INVESTIGATIONS

                  (1)      The Choctaw Gaming Commission shall require all
                           applicants for Class III Gaming licenses (entities
                           proposing to enter into Class III Gaming management
                           contracts and management officials and key employees)
                           to pay a nonrefundable application fee of $2,000 and
                           to complete an application form containing sufficient
                           information to allow a background investigation of
                           the applicant, including without limitation all
                           information required by regulations promulgated
                           pursuant to the IGRA. The Choctaw Gaining Commission
                           shall send a copy of the completed applications to
                           the Mississippi Gaming Commission and the National
                           Indian Gaming Commission. If the Choctaw Gaming
                           Commission determines that

                                       18
<PAGE>

                           investigative costs shall exceed the application
                           fee, the Choctaw Gaming Commission shall notify
                           the applicant in writing of the estimated costs to
                           be incurred by the Choctaw Gaming Commission in
                           performing or causing to be performed a background
                           investigation, and the applicant must pay such
                           estimated costs to the Choctaw Gaming Commission
                           prior to the Choctaw Gaming Commission processing
                           the application.

                  (2)      The Choctaw Gaming Commission shall ensure that
                           background investigations are conducted on all
                           applicants for Class III Tribal Gaming licenses and
                           that continuing oversight of management officials and
                           key employees is conducted. The Choctaw Gaming
                           Commission shall notify the Tribal Chief, the
                           National Indian Gaming Commission, and the
                           Mississippi Gaming Commission of the results of
                           background checks on any Class III Gaming applicants
                           and the findings concerning the eligibility of
                           applicants for receipt of a license prior to issuance
                           of any Tribal Class III Gaming license.

         8.4      APPLICATION FOR CLASS III GAMING WORK PERMIT; PROCEDURE

                  (1)      Applicants for a Class III Gaming work permit shall
                           complete an application form and shall furnish their
                           fingerprints in duplicate on fingerprint impression
                           cards and a current color photograph in duplicate to
                           the Choctaw Gaming Commission. The photographs must
                           be satisfactory to the Choctaw Gaming Commission and
                           must have been taken not earlier than three (3)
                           months before the date of filing the application. The
                           applicant shall also sign a written statement
                           certifying that the applicant is

                                       19
<PAGE>

                           not automatically disqualified for a work permit
                           in accordance with the standards set forth in
                           Section 8.6 below.

                  (2)      An applicant for a work permit shall pay the
                           application fee established by the Choctaw Gaming
                           Commission, by regulation, which shall be sufficient
                           to cover the costs of processing the application.

                  (3)      The Choctaw Gaming Commission shall forward a copy of
                           all applications for Class III Gaming work permits to
                           the Mississippi Gaming Commission prior to granting
                           the work permit.

                  (4)      The Choctaw Gaming Commission may either grant or
                           deny the work permit based upon its investigation and
                           review of the application.

         8.5      AUTOMATIC DISQUALIFICATION FOR OR REVOCATION OF LICENSE OR
                  WORK PERMIT

                  The Choctaw Gaming Commission shall deny or revoke Gaming
                  licenses or work permits to persons or entities whose prior
                  activities, criminal record, or records, habits and
                  associations pose a threat to the public interest or to the
                  effective regulation of Gaming or create or enhance the
                  dangers of unsuitable, unfair or illegal practices and
                  activities in connection with Gaming activities. All Class III
                  Gaming licenses and work permits shall be reviewed and, if
                  appropriate, renewed on an annual basis, with prompt
                  notification to the Mississippi Gaming Commission and National
                  Indian Gaming Commission of renewals of licenses. Should
                  tribal laws be amended to permit such, licenses and permits
                  may be renewed every two years after the first two annual
                  renewals. Without limiting the foregoing, the Choctaw Gaming
                  Commission must automatically deny or revoke Class III Gaming
                  licenses or permits to persons:

                                       20
<PAGE>

                           (a)      who have been convicted of a felony in any
                                    jurisdiction of any crime;

                           (b)      who have been convicted of a violation or
                                    conspiracy to violate the provisions of this
                                    Tribal-State Compact, the Indian Gaming
                                    Regulatory Act, or other Tribal or federal
                                    laws relating to involvement in Gaming
                                    without required licenses or willful evasion
                                    of Gaming fees or taxes;

                           (c)      having a notorious or unsavory reputation or
                                    association with such individuals which
                                    adversely affect public confidence and trust
                                    in Gaming;

                           (d)      whose license or work permit would violate
                                    conflict of interest rules in Section 15-1-4
                                    of the Tribal Code; or

                           (e)      who are individual applicants under the age
                                    of 21.

         8.6      DENIAL, SUSPENSION OR REVOCATION BASED UPON WRITTEN FINDINGS.

                  In the event the Choctaw Gaming Commission receives a written
                  finding from either the National Indian Gaming Commission or
                  the Mississippi Gaming Commission specifying why a particular
                  applicant or employee is not eligible for a Class III Gaming
                  license or work permit under the standards set forth in
                  Section 8.6 above, the Choctaw Gaming Commission shall suspend
                  the applicable Class III Gaming license or permit or shall
                  delay action on the application and shall notify the affected
                  applicant of the suspension and proposed revocation and of a
                  hearing time and place on the proposed revocation. After the
                  hearing, the Choctaw Gaming Commission shall decide to revoke
                  or reinstate the license or

                                       21
<PAGE>

                  permit and shall notify the Mississippi Gaming Commission
                  and the National Indian Gaming Commission of its decision.

         8.7      DISCIPLINE OF EMPLOYEES AND LICENSEES

                  In addition to the automatic license and permit revocations
                  pursuant to Section 8.6, the Choctaw Gaming Commission shall
                  propose regulations containing civil fines, penalties, license
                  or work permit suspensions or revocations that may be imposed
                  by the Choctaw Gaming Commission for violations of Restated
                  Title XV of the Tribal Code and any amendments thereto or
                  provisions of this Compact. Such regulations shall become
                  effective upon approval by the Tribal Council.

         8.8      EMPLOYEE GAMING

                  No person who holds a work permit or license from the Choctaw
                  Gaming Commission in connection with Class III Gaming or who
                  is employed by any of the Tribe's suppliers of Gaming
                  equipment shall be permitted to participate in any Tribal
                  Class III Gaming.

         8.9      PAYING PLAYERS

                  Neither the Tribe nor any of its agents, contractors or
                  employees may employ or pay any person to participate in any
                  Class III Game, including but not limited to any shill or
                  proposition player.

         8.10     MANAGEMENT CONTRACT WITH LICENSED CONTRACTOR

                  (1)      The Tribe will have sole proprietary interest in any
                           Casino. The Tribe and a contractor who has been
                           licensed pursuant to Section 8 of this Compact may
                           enter into a management contract for the operation
                           and management of a Casino, provided that such
                           management contract is in compliance with all
                           applicable requirements and provisions of the IGRA.

                                       22
<PAGE>

                  (2)      The Tribe shall require all "parties in interest" to
                           a proposed Class III management contract to submit to
                           the Choctaw Gaming Commission information and
                           identification sufficient to allow the Choctaw Gaming
                           Commission to perform or cause to be performed
                           background investigations on each party in interest
                           in accordance with Section 8 herein. The Tribe may
                           require the proposed contractor to cover the costs of
                           these background investigations. A copy of the
                           submitted information and the investigative reports
                           on each party in interest shall be provided by the
                           Choctaw Gaming Commission to the Mississippi Gaming
                           Commission prior to issuance of a Class III Gaming
                           license to the management contractor and prior to the
                           effective date of a Class III management contract. As
                           used in this section, "parties in interest" includes
                           any person or entity (including individuals
                           comprising such entity) having a direct financial
                           interest in, or responsibility for, the management of
                           a Casino pursuant to the management contract,
                           including investors, lenders, general and limited
                           partners, beneficiaries and trustees of a trust
                           acting as a party, corporate officers and directors,
                           all stockholders who hold (alone or in combination
                           with a spouse, parent, child or sibling of
                           stockholder) at least 10 percent of the stock of any
                           corporation which is a party to the contract.

SECTION  9. COST OF OVERSIGHT REGULATION, ENFORCEMENT, IMPROVEMENTS AND
            PROMOTION

         9.1      EXPENSE REIMBURSEMENT

                  The State and Tribe, acting by and through their respective
                  designees, shall mutually agree upon a budget for necessary
                  and actual expenses that may be

                                       23
<PAGE>

                  reasonably incurred by the State during the calendar year
                  in connection with Class III Gaming activities, including,
                  but not limited to, (i) oversight and enforcement actions
                  as provided for under this Compact, (ii) additional
                  manpower and equipment required by the Department of Public
                  Safety due to increased traffic control on State highways
                  leading to a Casino, and (iii) costs in making any
                  necessary improvements to an intersection of a State
                  highway with a Bureau of Indian Affairs or Tribal road
                  leading to a Tribal Casino as a result of increased traffic
                  due to Class III gaming activities and utilizing
                  governmental grants and road funds, where available. For
                  purposes of this Section 9, "Calendar Year" means the
                  twelve month time frame beginning on the date of
                  commencement of operations of the Casino. The State shall
                  prepare a quarterly payment request for actual expenses
                  specified in the approved budget, incurred by the State
                  during the preceding quarter, which shall be paid within
                  thirty (30) days thereafter.

         9.2      PROMOTION OF TOURISM

                  Subject to the State designating Tribal lands as a State
                  tourism council area, the Tribe and the State shall separately
                  provide $250,000 each year in matching funds to be used for
                  advertising and promotion of tourism. The Tribe's $250,000 per
                  year contribution shall be paid in quarterly installments of
                  $62,500 each, conditioned upon the Tribe receiving profits of
                  at least $62,500 from the preceding quarter of Class III
                  Gaming operations. For purposes of this Section 9.2, quarterly
                  payment dates shall be January 15, April 15, July 15, and
                  October 15, unless otherwise agreed by the parties.

                                       24
<PAGE>

SECTION 10. DISPUTE RESOLUTION

In the event that either party believes that the other party has failed to
comply with any requirement of this Compact or applicable regulations
thereunder, or in the event of any disagreement or dispute as to the proper
interpretation of the terms and conditions of this Compact, the following
procedures shall apply:

         10.1     The party asserting noncompliance or seeking an interpretation
                  shall serve written notice on the other party. The notice
                  shall identify the specific Compact provision alleged to have
                  been violated and shall specify in detail the factual basis
                  for the alleged noncompliance of the Compact provision for
                  which interpretation is sought. Thereafter, the Governor and
                  Tribal Chief, or their designated representatives, shall meet
                  within thirty (30) days in an effort to resolve the dispute.

         10.2     In the event the dispute is not resolved to the satisfaction
                  of the parties within ninety (90) days after service of the
                  notice set forth in Section 10.1 above, the dispute shall be
                  resolved through arbitration, as follows:.

                  (1)      The parties shall agree upon one arbitrator.

                  (2)      If the parties are unable to so agree, the Tribe and
                           the State shall each select one arbitrator, who
                           thereafter shall select a third arbitrator with
                           expertise in the subject matter of the dispute, and
                           the three arbitrators so selected shall arbitrate the
                           dispute. In the event the two arbitrators selected by
                           the parties are unable to agree on a third
                           arbitrator, the third arbitrator shall be appointed
                           by the American Arbitration Association.

                  (3)      The arbitrators shall meet with the parties
                           immediately after their appointment to determine a
                           schedule for arbitration, including whether and

                                       25
<PAGE>


                           to what extent discovery is required. The arbitrators
                           may set the matter for an evidentiary hearing, or
                           oral argument, or may determine to dispose of the
                           dispute based upon written submissions only. If an
                           evidentiary hearing is held, the normal rules of
                           evidence shall be relaxed, pursuant to the
                           arbitrators' discretion. All parties shall have the
                           right to participate in the hearing and may determine
                           the most effective and efficient method for the
                           presentation of their case. The parties may present
                           evidence through live testimony, written reports and
                           affidavits, or the argument of counsel or its
                           representative at the hearing. The parties may be
                           represented by any person of their choice at
                           proceedings before the arbitrators, irrespective of
                           whether the representative is an attorney.

                  (4)      The cost of arbitration shall be borne equally by the
                           Tribe and State. All parties shall bear their own
                           costs and attorney fees associated with their
                           participation in arbitration. The decision of the
                           arbitrators shall be final and non-reviewable. Any
                           party may pursue any remedy which is otherwise
                           available to that party to enforce orders of the
                           arbitrators in the event voluntary compliance does
                           not occur.

SECTION 11. RESERVATION OF RIGHTS UNDER THE IGRA

The State and Tribe agree that by entering into this Compact, the Tribe shall
not be deemed to have waived its right to initiate and pursue the procedures
provided by the IGRA if the State should refuse to enter into a compact with
respect to other forms of Class III Gaming, and neither the State nor the Tribe
shall be deemed to have waived any rights, arguments or defenses applicable to
such a procedure.

                                      26
<PAGE>

SECTION 12. ALCOHOLIC BEVERAGE LICENSE

In the event that the Tribal Council passes an ordinance approved by the
Secretary that allows sales of alcoholic beverages on or about Casino premises
or adjacent property on Tribal lands designated by the Tribal Council as a
resort area, then the State will designate the same Tribal lands as a resort
area and shall authorize sales of liquor from the State warehouse to the Tribe
and persons or entities as may be authorized by the Tribe to sell alcoholic
beverages on designated Tribal lands, and the Tribe and such persons or entities
as it may authorize to sell alcoholic beverages will purchase liquor exclusively
from the State warehouse.


SECTION 13. SEVERABILITY

Each provision, section, and subsection of this Compact shall stand separate
and independent of every other provision, section, or subsection. In the
event that a court of competent jurisdiction shall find any provision,
section, or subsection of this Compact to be invalid, the remaining
provisions, sections, and subsections of the Compact shall remain in full
force and effect.

SECTION 14. NOTICES

All notices required or authorized to be served under this Compact shall be
served by certified mail (return receipt requested), commercial overnight
courier service or by personal delivery, at the following addresses:

                  Governor:         State of Mississippi
                                    P.O.  Box 139
                                    Jackson, MS 39205

                  Tribal Chief:     Mississippi Band of Choctaw Indians
                                    P.O.  Box 6010
                                    Philadelphia, MS 39350

                                      27
<PAGE>

SECTION 15. EFFECTIVE DATE AND DURATION

         15.1     EFFECTIVE DATE

                  This Compact shall become effective upon execution by the
                  Governor of the State and the Tribal Chief, approval by the
                  Secretary of the Interior and publication of that approval in
                  the Federal Register pursuant to the IGRA. This Compact is
                  entered into pursuant to the IGRA.

         15.2     DURATION

                  This Compact shall remain in full force and effect until
                  terminated by mutual consent of the parties.

SECTION 16. AMENDMENTS

The State or the Tribe may, by appropriate and lawful means, request
negotiations to amend, replace or repeal this Compact. In the event of a request
for renegotiation or the negotiation of a new Compact, this Compact shall remain
in effect until renegotiated or replaced. Such requests shall be served pursuant
to Section 14. If such a request is made by the Tribe, it shall be treated as a
request to negotiate pursuant to the IGRA. The parties shall have 180 days to
negotiate, and all further procedures and remedies available under the IGRA
shall thereafter apply. The Tribe and the State may agree to extend the 180 day
period without prejudice to the rights of either party under this Section. Any
amendment to this Compact must be approved by the Secretary.

SECTION 17. ENTIRE AGREEMENT; SUCCESSORS AND ASSIGNS.

This Compact contains the entire agreement of the parties hereto with respect to
the matters covered by this Compact and no other statement, agreement, or
promise made by any party, officer, or agent of any party shall be valid or
binding. This Compact shall by binding upon the successors and assigns of the
parties hereto.

                                      28
<PAGE>

SECTION 18. GOVERNING LAW.

This Compact shall be governed by and construed in accordance with the laws of
the United States.

SECTION 19. JUDICIAL ENFORCEMENT.

Any judicial action brought to enforce the terms of an arbitration decision
rendered under Section 10 of the Compact shall be brought only in the
appropriate United States District Court; provided however, that if a United
States District Court should first determine that it lacks subject matter
jurisdiction over such a cause of action, an enforcement action may then be
instituted in the courts of the State.

SECTION 20. AUTHORITY TO EXECUTE.

Each of the undersigned represents that he is duly authorized and has the
authority to execute this agreement on behalf of the party for whom he is
signing.

STATE OF MISSISSIPPI                        MISSISSIPPI BAND OF CHOCTAW INDIANS


/s/ KIRK FORDICE                            /s/ PHILLIP MARTIN
------------------------------------        ------------------------------------
KIRK FORDICE, GOVERNOR                      PHILLIP MARTIN, CHIEF

DATE:          12/4/92                      DATE:    12/4/92
       -----------------------------             -------------------------------


                                            /s/ FRANK STEVE
                                            ------------------------------------
                                            FRANK STEVE, SECRETARY-TREASURER



                                            DATE:    12/4/92
                                                  -----------------------------



BUREAU OF INDIAN AFFAIRS


------------------------------------
SECRETARY OF INTERIOR

DATE:
       -----------------------------

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