<PAGE>
                                                                    EXHIBIT 10.1

                               FOURTH AMENDMENT TO
                        HAMMOND RIVERBOAT GAMING PROJECT
                              DEVELOPMENT AGREEMENT

               This FOURTH AMENDMENT TO HAMMOND RIVERBOAT GAMING PROJECT
DEVELOPMENT AGREEMENT (the "Fourth Amendment"), made as of the 26th day of
October, 2001 (the "Effective Date"), by and among THE CITY OF HAMMOND, INDIANA,
a municipal corporation (the "City"), THE CITY OF HAMMOND, DEPARTMENT OF
REDEVELOPMENT (the "Redevelopment Commission"), THE CITY OF HAMMOND PORT
AUTHORITY ("PORT AUTHORITY"), and THE CITY OF HAMMOND REDEVELOPMENT AUTHORITY
("Redevelopment Authority"), and HORSESHOE HAMMOND, INC., formerly known as
EMPRESS CASINO HAMMOND CORPORATION (the "Developer"), WITNESSES THAT:

                                    RECITALS

               A. On or about June 21, 1996, the City and Developer entered into
the Hammond Riverboat Gaming Project Development Agreement (the "Contract"),
under which the Developer agreed, among other things, to plan and construct a
riverboat gaming facility and related improvements (the "Casino") on Lake
Michigan and certain property in Hammond, Indiana.

               B. On or about November 17, 1995, the Indiana Gaming Commission
(the "IGC") awarded a Certificate of Suitability to the Developer for an owner's
license to own and operate a riverboat casino on Lake Michigan from the City of
Hammond, Indiana. The Certificate of Suitability was subsequently extended by
IGC Resolution 1996-28 (the Certificate of Suitability as extended by Resolution
1996-28 is hereinafter referred to as the "Suitability Certificate").

               C. Upon satisfaction and completion of the items and conditions
outlined and referred to in the Suitability Certificate, the Developer was
issued an owner's license as defined in Indiana Code Section 4-33-2-15 (the
"Owner's License") that allows the Developer to own and operate a riverboat
casino on Lake Michigan from the City of Hammond, Indiana.

               D. On or about August ____, 1999, the City and Developer amended
and modified the Contract pursuant to the terms and conditions of that certain
First Amendment to Hammond Riverboat Gaming Project Development Agreement (the
"First Amendment"); on or about August __, 1999, the City, Redevelopment
Commission, City of Hammond, Department of Water Works and Developer amended and
modified the Contract pursuant to the terms and conditions of that certain
Second Amendment to Hammond Riverboat Gaming Project Development Agreement (the
"Second Amendment"); on or about December __, 2000, the City, Redevelopment
Commission and Developer amended and modified the Contract pursuant to the terms
and conditions of that certain Third Amendment to Hammond Riverboat Gaming
Project Development Agreement (the "Third Amendment") (the Contract as amended
and modified by

<PAGE>
the First Amendment, Second Amendment, Third Amendment and this Fourth Amendment
is referred to herein as the "Agreement").

               E. On or about May 25, 1999, the Redevelopment Authority acquired
that certain parcel of real estate which is described on Exhibit "A" attached
hereto and made a part hereof (the "Marina Parcel"). On or about April 15, 1999,
the Redevelopment Authority leased the Marina Parcel to the Redevelopment
Commission. On or about April 15, 1999, the Redevelopment Commission and the
Port Authority entered into an Operating Agreement pursuant to which the Port
Authority is operating the Marina.

               F. On or about _December 1, 1999, Horseshoe Hammond, Inc.
acquired all right, title and interest of Empress Casino Hammond Corporation
under the Agreement and assumed all obligations of Empress Casino Hammond
Corporation under the Owner's license and the Agreement.

                                    AGREEMENT

               NOW, THEREFORE, in consideration of the foregoing premises, the
mutual covenants of the parties herein contained, and other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
City, Redevelopment Commission, Redevelopment Authority, Port Authority and
Developer agree as follows:

               1. Amendment. This Fourth Amendment is intended to confirm and
ratify the terms of the Agreement, except as specifically provided herein to the
contrary, in which case the provisions of this Fourth Amendment shall prevail.
The foregoing Recitals are affirmed by the parties and incorporated herein by
this reference.

               2. Marina Parcel Sublease. The parties hereto mutually agree and
acknowledge that the refund date for the Marina Sublease Deposit and the due
date for the Note shall be extended from January 15, 2002, to May 15, 2002.


               3. Option to Lease Marina Parcel.

               (a)      For such consideration as hereinafter set forth, the
                        Redevelopment Commission hereby grants to the Developer
                        an exclusive and irrevocable option (the "Option") to
                        lease that portion of the Marina Parcel which is
                        described and/or depicted on Exhibit "B" attached hereto
                        and made a part hereof (the "Option Area"), upon the
                        terms and conditions hereinafter set forth. The
                        Developer's right to exercise the Option shall commence
                        upon the Effective Date and shall expire on the tenth
                        (10th) anniversary of the Effective Date. The Developer
                        may exercise, from time to time, the Option with respect
                        to all of the Option Area or with respect to portions of
                        the Option Area designated by the Developer at the time
                        of the exercise; provided, however, that any portion of
                        the Option Area as to which the


                                      -2-
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                        Option has not been exercised shall contain at least one
                        (1) acre and have vehicular and pedestrian access to
                        Casino Center Drive. The Option shall be exercised by
                        written notice from the Developer to the Redevelopment
                        Commission prior to the expiration of the Option and
                        specifying by metes and bounds description the portion
                        of the Option Area affected thereby.

               (b)      The Developer hereby exercises the Option with respect
                        to that portion of the Option Area which is described
                        and/or depicted on Exhibit "C" attached hereto and made
                        a part hereof (the "Valet Parking Area") for the purpose
                        of constructing a surface parking lot for approximately
                        two hundred sixty-two (262) (or such greater number as
                        the Developer determines can be located on the Valet
                        Parking Area) vehicles. The Developer shall apply for
                        and obtain such permits, approvals and authorizations
                        and take such other actions as required to commence and
                        complete construction of an asphalt surfaced parking lot
                        on the Valet Parking Area. The City, Redevelopment
                        Commission, Redevelopment Authority and Port Authority
                        (the "Units") shall, to the extent permitted by
                        Applicable Laws and without material cost to any of the
                        Units, cooperate with the Developer in the obtaining of
                        such permits, approvals and authorizations. The
                        Developer shall be responsible for the fees payable to
                        the permitting authority for any such permits, approvals
                        and authorizations. Prior to the commencement of the
                        construction of an asphalt paving lot on the Valet
                        Parking Area, the Developer shall, after consultation
                        with the City's engineers and consultants, submit a
                        final site plan to the City and Port Authority of the
                        improvements to be constructed on the Valet Parking Area
                        showing the location and intended striping of the
                        parking surface, drainage, access to adjoining roads,
                        landscaping and other amenities, which site plan shall
                        be subject to the prior written approval of the City and
                        Port Authority. Such approval shall not be unreasonably
                        withheld or delayed provided that an Event Default does
                        not then exist under this Agreement and the improvements
                        depicted in such site plan do not unreasonably interfere
                        with the operation of the Marina or access to or use of
                        the existing building occupied by the Yacht Club and
                        located on the Option Area (the "Yacht Club") or the
                        existing building occupied by the Port Authority and
                        located on the Option Area (the "Port Authority
                        Building"). The surface parking lot shall be constructed
                        in compliance with the approved site plan and all
                        Applicable Laws. Notwithstanding anything to the
                        contrary in this Fourth Amendment, (i) the Developer's
                        right to use the Valet Parking Area shall be subject to
                        the terms and conditions of the Intergovernmental Lease
                        and Parking Plan (as such terms are hereinafter
                        defined), and (ii) the Developer may not construct any
                        improvements (including, without limitation, a surface
                        parking lot) on the Valet Parking Area until after the
                        Permanent Ramp is constructed, accessible by the public
                        and functioning as intended.



                                      -3-
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               (c)      The Developer shall construct an above ground parking
                        structure on the Valet Parking Area or the Alternative
                        Parcel. The Developer shall construct one (1)
                        free-standing, above ground parking structure on either
                        of the Alternative Parcel or the Valet Parking Area, but
                        shall not be permitted to construct a structure
                        containing only a free-standing, above ground parking
                        structure on both the Valet Parking Area and the
                        Alternative Parcel. The Developer may construct a second
                        (2nd) above ground parking structure on either of the
                        Alternative Parcel or the Valet Parking Area so long as
                        one of such structures is a part of and accessory to a
                        facility for other uses permitted by this Agreement. If
                        an above ground parking structure is constructed on the
                        Alternative Parcel, such above ground parking structure
                        shall be constructed in accordance with the requirements
                        of the Agreement. If an above ground parking structure
                        is constructed on the Valet Parking Area, such above
                        ground parking structure shall not exceed five (5)
                        parking levels in height and shall be constructed in
                        accordance with the requirements of the Agreement. The
                        Developer shall commence the construction of an above
                        ground parking structure on the Valet Parking Area or
                        the Alternative Parcel on or before December 31, 2002.
                        The Developer shall commence the construction of an
                        entertainment/banquet venue or hotel, or with the
                        written approval of the City, the Redevelopment
                        Commission and the Port Authority (which approval may be
                        withheld in the sole discretion of the City, the
                        Redevelopment Commission and the Port Authority), some
                        other facility atop the parking structure on the Valet
                        Parking Area or the Alternative Parcel on or before
                        December 31, 2003. That portion of the Valet Parking
                        Area described and depicted as Parcel 1 on Exhibit "C"
                        attached hereto and made a part hereof may be used for
                        banquet, entertainment, retail, restaurant, gaming,
                        gaming offices, parking and/or hotel purposes only and
                        for such other purposes which are approved in writing by
                        the City, Redevelopment Commission and Port Authority,
                        which approval may be withheld in the sole discretion of
                        the City, Redevelopment Commission and Port Authority.
                        That portion of the Valet Parking Area which is
                        described and depicted as Parcel 2 on Exhibit "C" may be
                        used only for parking and ingress and egress purposes
                        and for such other purposes which are approved in
                        writing by the City, Redevelopment Commission and Port
                        Authority, which approval may be withheld in the sole
                        discretion of the City, Redevelopment Commission and
                        Port Authority. Prior to the commencement of the
                        construction of any improvements on the Valet Parking
                        Area (other than those improvements which are approved
                        pursuant to Paragraph 3 (b)), the Developer shall, after
                        consultation with the City's engineers and consultants,
                        submit Plans and Specifications for such improvements to
                        the City, Redevelopment Commission and Port Authority
                        for their prior written approval. Such approval shall
                        not be unreasonably withheld or delayed provided that an
                        Event of Default does not then exist under this
                        Agreement and the improvements depicted in such Plans
                        and Specifications do not unreasonably interfere with
                        the



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<PAGE>
                        operation of the Marina or access to or use of the Yacht
                        Club or Port Authority Building. The Developer shall
                        apply for and obtain such permits, approvals and
                        authorizations and take such other actions as required
                        to commence and complete construction of any such
                        improvements. The Units shall, to the extent permitted
                        by Applicable Laws and without material cost to any of
                        the Units, cooperate with the Developer in the obtaining
                        of such permits, approvals and authorizations. Any
                        improvements constructed on the Valet Parking Area shall
                        be constructed in compliance with the approved Plan and
                        Specifications and all Applicable Laws.

               (d)      That portion of the Option Area remaining after
                        excepting therefrom the Valet Parking Area, may be used
                        for retail or restaurant purposes only and for such
                        other purposes which are approved in writing by the
                        City, Redevelopment Commission and Port Authority, which
                        approval may be withheld in the sole discretion of the
                        City, Redevelopment Commission and Port Authority. The
                        Developer acknowledges that in seeking such approval any
                        contemplated use shall not interfere with the operation
                        of the Marina or access to or use of the existing Yacht
                        Club or Port Authority Building. Prior to the
                        commencement of the construction of any improvements on
                        that portion of the Option Area remaining after
                        excepting therefrom the Valet Parking Area, the
                        Developer shall, after consultation with the City's
                        engineers and consultants, submit Plans and
                        Specifications for such improvements to the City,
                        Redevelopment Commission and Port Authority for their
                        prior written approval. Such approval shall not be
                        unreasonably withheld or delayed provided that an Event
                        of Default does not then exist under this Agreement and
                        the improvements depicted in such Plans and
                        Specifications do not unreasonably interfere with the
                        operation of the Marina, access to and the proper
                        functioning of the existing boat ramp (unless the
                        Permanent Ramp has been constructed and is functioning
                        as intended) or access to or use of the Yacht Club or
                        Port Authority Building. The Developer shall apply for
                        and obtain such permits, approvals and authorizations
                        and take such other actions as required to commence and
                        complete construction of any such improvements. The
                        Units shall, to the extent permitted by Applicable Laws
                        and without material cost to any of the Units, cooperate
                        with the Developer in the obtaining of such permits,
                        approvals and authorizations. Any improvements
                        constructed on balance of the Option Area shall be
                        constructed in compliance with the approved Plans and
                        Specifications and all Applicable Laws.

               (e)      Within a reasonable time after the Effective Date, (i)
                        the Redevelopment Commission and Port Authority shall
                        enter into an amendment to the Intergovernmental Lease
                        Agreement and Grant of Easement dated August __, 1999
                        ("Intergovernmental Agreement") between the
                        Redevelopment Commission and Port Authority to modify
                        Paragraph 4 of the



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<PAGE>
                        Intergovernmental Agreement, to incorporate the terms of
                        the "Proposed Parking Plan" described in Exhibit "D"
                        attached hereto and made a part hereof (the "Parking
                        Plan"), and (ii) the applicable Units and the Developer
                        shall agree upon and document cross-easements in favor
                        of the public and appropriate governmental authorities
                        for vehicular and pedestrian access by the public to the
                        Marina, existing boat ramp and related improvements
                        (until the Permanent Ramp has been constructed and is
                        functioning as intended), Yacht Club and Port Authority
                        Building. The Developer acknowledges and agrees that it
                        shall provide Port Authority with three hundred (300)
                        parking spaces on the first (1st) floor of any above
                        ground parking structure constructed on the Valet
                        Parking Area with admission via parking passes or
                        permits at no cost, expense or fee to Port Authority for
                        use by such guests, visitors, patrons and other users of
                        the Marina and surrounding areas as may be designated by
                        Port Authority, and that such spaces on the first floor
                        of such structure shall have a separate entrance and be
                        segregated from other parking spaces in such structure.

               (f)      As consideration for the granting of the Option and the
                        respective agreements of the other parties hereto, the
                        Developer has previously paid the aggregate sum of Seven
                        Million Dollars ($7,000,000.00) to the entities in the
                        respective amounts set forth on Schedule I attached
                        hereto and made a part hereof and agrees to pay an
                        additional Seven Million Dollars ($7,000,000.00) in the
                        aggregate on or before February 8, 2002 to the entities
                        in the amounts set forth on Schedule II attached hereto
                        and made a part hereof (the "Cash Consideration"). The
                        City, on behalf of the entities set forth on Schedule I,
                        acknowledges receipt of the first installment of the
                        Cash Consideration. The City, Redevelopment Authority,
                        Redevelopment Commission and Port Authority each
                        acknowledge that it is receiving adequate consideration
                        for its respective agreements hereunder (including,
                        without limitation, the granting of the Option) and will
                        be benefited by the payment of the Cash Consideration to
                        the entities set forth in Schedules I and II. The Cash
                        Consideration is nonrefundable and is deemed earned by
                        the City regardless of whether the Developer exercises
                        the Option or constructs any improvements on the Option
                        Area and regardless of whether the Option is terminated,
                        discontinued or cancelled by the Developer at any time
                        or for any reason. The Cash Consideration constitutes
                        funding for commercial, residential and recreational
                        projects and programs benefiting the City of Hammond,
                        Indiana. As additional consideration for the Option, the
                        Developer agrees, at its sole expense, to perform the
                        following:

                        (i)     Relocate the existing boat ramp and related
                                improvements (including, without limitation, the
                                step crane and fish cleaning station) to a
                                permanent location approved by the City,
                                Redevelopment Commission and Port Authority (the
                                "Permanent


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                                Location"). Such relocated boat ramp and related
                                improvements (the "Permanent Ramp") shall be
                                comparable in size, quality, function and
                                amenities to the existing boat ramp and shall be
                                constructed in accordance with Plans and
                                Specifications prepared by the Developer and
                                approved by the City, Redevelopment Commission
                                and Port Authority. The approval of the City,
                                Redevelopment Commission and Port Authority as
                                to the Permanent Location and the Plans and
                                Specifications for the Permanent Ramp shall not
                                be unreasonably withheld or delayed. Such
                                construction shall commence as soon as possible
                                after the Permits (as herein defined) are
                                obtained by the City and all other permits,
                                approvals and authorizations are obtained by the
                                Developer, and shall be completed by no later
                                than six (6) months after commencement of
                                construction. It is the intention of the parties
                                hereto that the construction of the Permanent
                                Ramp will be completed by no later than April
                                15, 2003. To the extent permitted by Applicable
                                Laws, the City, Redevelopment Commission and
                                Port Authority shall grant, and shall use their
                                best efforts to cause any other appropriate
                                governmental entity to grant, a right of entry,
                                license, or other appropriate authorization to
                                permit the Developer to enter upon the Permanent
                                Location to construct the Permanent Ramp. The
                                City shall apply for and be responsible for
                                obtaining permits and approvals from the U.S.
                                Army Corp of Engineers and any other
                                governmental agency for the relocation of the
                                existing boat ramp and relocated improvements to
                                the Permanent Location (the "Permits"), and the
                                Developer shall apply for and be responsible for
                                obtaining all other permits, approvals and
                                authorizations for such relocation. The
                                Developer shall reimburse the City for the
                                reasonable costs and expenses (including
                                attorneys' fees) incurred by the City in
                                connection with applying for and obtaining the
                                Permits. The Units shall, to the extent
                                permitted by Applicable Laws and without
                                material cost to any of the Units, cooperate
                                with the Developer in obtaining such other
                                permits, approvals and authorizations. The City
                                shall use all reasonable efforts to obtain and
                                diligently pursue the Permits, and the Developer
                                shall use all reasonable efforts to obtain and
                                diligently pursue all such other permits,
                                approvals and authorizations. The Developer
                                agrees that the existing boat ramp and related
                                improvements will remain accessible to the
                                public and function as intended until the
                                construction of the Permanent Ramp is completed
                                and the Permanent Ramp is accessible by the
                                public and functions as intended.

                        (ii)    In the event the Developer exercises the Option
                                with respect to the area occupied by the
                                existing Port Authority Building and related
                                amenities, the Developer shall, at its sole
                                expense, provide



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<PAGE>
                                alternative space to Port Authority comparable
                                to the existing Port Authority Building and
                                related amenities, either to the west in a stand
                                alone structure in an area approved by the City
                                and Port Authority or in a portion of a
                                structure constructed by the Developer approved
                                by the City and Port Authority. The Developer
                                may, at its election, carve out the existing
                                Port Authority Building and related amenities
                                from the Option Area and allow it to remain by
                                operating or building around it. In such event,
                                the Developer shall assure Port Authority by
                                easement or other appropriate documentation of
                                adequate access and parking facilities
                                comparable to the access and parking facilities
                                currently enjoyed by Port Authority in
                                connection with Port Authority Building.

                        (iii)   The Developer shall pay a security deposit in
                                the amount of Three Million Two Hundred Fifty
                                Thousand Dollars ($3,250,000.00) to the City or
                                its designee within ninety (90) days after the
                                date hereof, in connection with the Developer's
                                rights under the Option and the ensuing Lease
                                (the "Security Deposit"). The Security Deposit
                                shall earn interest in increments at the
                                respective interest rates set forth on Schedule
                                IV attached hereto, with interest paid to the
                                Developer on each such increment semi-annually
                                and as otherwise set forth on Schedule IV
                                attached hereto. The principal amount of the
                                Security Deposit shall be returned to the
                                Developer in increments on the respective payoff
                                dates set forth for each such increment on
                                Schedule IV attached hereto.

                        (iv)    The Developer acknowledges that, absent certain
                                "remedial action", the proposed activities of
                                the Developer contemplated by this Fourth
                                Amendment will adversely affect the tax
                                exemption of the existing Hammond Redevelopment
                                Authority Lease Rental Revenue Bonds of 1999
                                issued to refinance previously issued bonds that
                                financed a portion of the construction of the
                                Hammond Marina (the "Marina Bonds"). The
                                Developer acknowledges that the Units have taken
                                certain "remedial actions" based on the
                                Developer's expected activities as contemplated
                                by this Fourth Amendment and that additional or
                                different activities by the Developer may
                                require additional actions to be taken by the
                                Units to preserve and maintain the tax exemption
                                on the Marina Bonds. The Developer shall be
                                responsible for (a) all current and continuing
                                reasonable expenses of the legal and financial
                                advisors of the City, Redevelopment Authority,
                                Redevelopment Commission and Port Authority in
                                connection with maintaining the continuing tax
                                exemption of the interest on the Marina Bonds
                                under federal and state law as a result of the
                                actions of the Developer contemplated or
                                permitted by this Fourth Amendment,


                                      -8-
<PAGE>
                                and (b) implementing the recommendations of such
                                legal and financial advisors to maintain the
                                continuing tax exemption of the interest on the
                                Marina Bonds under federal and state law as a
                                result of the action of the Developer
                                contemplated or permitted by this Fourth
                                Amendment.

               4. Lease Amendment. Upon exercise of the Option from time to
time, either as to all or a part of the Option Area, the Redevelopment
Commission shall offer that portion of the Option Area as to which the Option
has been exercised for lease pursuant to the provisions of Applicable Laws, and
as a requirement for submitting a bid to lease such parcel, a bidder must have
received a License for the operation of a riverboat on Lake Michigan from
Hammond, Indiana. The Redevelopment Commission shall commence proceedings for
the lease of the portion of the Option Area as to which the Option has been
exercised as soon as is practical after the Developer exercises the Option with
respect to all or a portion of the Option Area. In the event that the Developer
is the successful bidder and to the extent permitted by Applicable Laws, that
certain Lease dated June 19, 1996 by and between Redevelopment Commission and
the Developer shall be amended to add to the leased premises thereunder that
portion of the Option Area subject to such exercise for the balance of the term
thereof and without the payment of additional rent or other consideration.

               5. Cooperation. Subject to Section 11.09 of the Agreement and to
the extent permitted by Applicable Laws, the City, Port Authority, Redevelopment
Authority and Redevelopment Commission will cooperate with the Developer in
connection with, and will support the Developer's application for, zoning
changes, permits and other regulatory approvals required in connection with the
Developer's proposed use and development of the Option Area in accordance with
the terms hereof. Any cost associated therewith shall be the responsibility of
the Developer. The Developer acknowledges that various federal, state or local
approvals may be required by the Developer and that there is no assurance that
such approvals can be obtained. The obligations of the Developer to pay the Cash
Consideration hereunder are not conditioned upon the Developer obtaining any
required approvals. The Developer shall cause its architects, engineers and
other professionals to furnish such plans, specifications and drawings to the
City and Redevelopment Commission in such detail as required to permit review
thereof for purposes of obtaining such approvals as herein required.

               6. Obligations. Section 5.13(c) of the Agreement, as added by the
First Amendment and previously amended by the Third Amendment, is hereby amended
to reflect the following: First, that the Developer has purchased the BANs (as
defined in the First Amendment) and the City has repaid the BANs in full, and
that the Developer has purchased the Obligations (as defined in the First
Amendment) and that the City has repaid the Obligations in full; and Second,
that new Sections 5.13(c)(iv) and (v) be added to the Agreement as follows:

               (iv)     Upon repayment of the Obligations in full by the City,
                        the City, or any agency or instrumentality thereof or
                        other corporation or entity that issues obligations on
                        behalf of the City or any agency or instrumentality
                        thereof (an "Issuer"), may borrow or reborrow amounts
                        from the Developer, and the Developer hereby agrees to
                        loan such funds to the City. The Issuer



                                      -9-
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                        agrees to provide the Developer with not less than ten
                        (10) business days written notice of its request for the
                        Developer to borrow or reborrow such funds. The terms of
                        any such borrowing shall be as follows:

               (v)      the borrowing shall be evidenced by one or more notes
                        issued by an Issuer (the "Notes") which Notes shall
                        authorize the Issuer to borrow funds from time to time
                        (each such borrowing, a "Draw"), to repay outstanding
                        amounts from time to time and to reborrow funds pursuant
                        to a Draw, up to the amount authorized to be outstanding
                        pursuant to subsection (w);

               (w)      the total principal amount of all such Notes outstanding
                        at any one time shall not exceed the amounts, as of the
                        dates, set forth below:

<TABLE>
<CAPTION>
                                                                   Maximum Principal
                             Date                                  Amount Outstanding
                             ----                                  ------------------
<S>                                                                <C>
                             January 15, 2002                           2,900,000
                             January 15, 2003                           2,700,000
                             January 15, 2004                           2,500,000
                             January 15, 2005                           2,300,000
                             January 15, 2006                           2,100,000
                             January 15, 2007                           1,800,000
                             January 15, 2008                                0
</TABLE>

               (x)      the Notes shall bear interest from the date of any Draw
                        at a taxable rate of five percent (5%) per annum,
                        payable semi-annually on January 15 and July 15 of each
                        year, commencing on the first interest payment date
                        after the Draw;

               (y)      principal of the outstanding Notes shall be repaid in
                        such a manner that the principal amount of Notes
                        outstanding at any time does not exceed the amounts set
                        forth in subsection (w); and

               (z)      the Notes shall be issued in denominations of not less
                        than $100,000, and at the time of delivery of such
                        Notes, The Developer shall deliver to the Issuer a
                        "sophisticated investor letter" in form and content
                        similar to those rendered in other private placements of
                        municipal obligations, and acknowledging, among other
                        things, that the Developer intends to hold the Notes for
                        its own account


                                      -10-
<PAGE>
                        and has no present intention to re-offer, sell or
                        otherwise distribute such Notes.

               (v)      The City acknowledges and agrees upon the non-payment of
                        any amount of principal and/or interest on the Notes
                        purchased by the Developer pursuant to subsection (iv)
                        when due, the Developer shall have the right to credit
                        the unpaid principal balance of such Notes, and the
                        interest accrued thereon against the obligations of the
                        Developer to make the Annual Payment pursuant to Section
                        5.01 of this Agreement; provided, that, the amount
                        credited against the obligations of the Developer to
                        make the Annual Payment shall not exceed fifty percent
                        (50%) of any such monthly installment without prior
                        written approval of the City.

               7. No Default. The Developer and City hereby acknowledge that, to
the best of their respective knowledge, no material default exists by either
party to the Agreement as of the date hereof. The Developer and City further
acknowledge that neither party has given the other party a written notice that
the other party is in default under the terms or conditions of the Agreement.

               8. Defined Terms. All terms used in this Fourth Amendment with
initial capital letters (and not otherwise defined in this Fourth Amendment)
shall have the respective meanings ascribed to them in the Agreement for
purposes of this Fourth Amendment. All terms defined in this Fourth Amendment
shall have the respective meaning specified herein for purposes of this Fourth
Amendment and the Agreement.

               9. Authority. Each of the parties represents and warrants to all
other parties to this Fourth Amendment that it has all requisite corporate power
and authority to enter into this Fourth Amendment and to perform its obligations
hereunder and that all acts and other proceedings required to be taken by it to
authorize the execution, delivery and performance of this Fourth Amendment have
been duly and properly taken.

               10. Execution. This Fourth Amendment shall be binding upon the
Developer and City upon their execution hereof. The City agrees to use
reasonable efforts to cause this Fourth Amendment to be executed by the
Redevelopment Commission, Port Authority and Redevelopment Authority on or
before April 30, 2002. In the event that this Fourth Amendment has not been
executed by the Redevelopment Commission, Port Authority and Redevelopment
Authority on or before April 30, 2002, the Developer shall have the right to
notify the City in writing (the "Developer's Notice") of the Developer's
intention to terminate this Fourth Amendment as of a date specified by the
Developer in the Developer's Notice, which date shall be at least thirty (30)
days after the effective date of the Developer's Notice, if the Fourth Amendment
has not been executed by the Redevelopment Commission, Port Authority and
Redevelopment Authority on or before such date. In the event this Fourth
Amendment is not executed by the Redevelopment Commission, Port authority and
Redevelopment Authority on or before the date specified in the Developer's
Notice, this Fourth Amendment may be terminated by the Developer, in which case,
the City shall cause the Cash Consideration to be refunded or otherwise repaid
to the Developer.



                                      -11-
<PAGE>
               11. Bond. Under the terms of the Agreement, the Developer is
obligated to construct certain improvements, and the Units hereby acknowledge
and agree that, except with respect to any obligations expressly provided in
this Fourth Amendment, including but not limited to the EJ&E Obligations (as
defined and described in this Section 11), the Developer has satisfied each and
every one of the obligations in connection with the construction of such
improvements contemplated in the Agreement and in the First Amendment, the
Second Amendment and the Third Amendment. Accordingly, (i) Developer intends to
request that the IGC reduce the amount of the Developer's bond on deposit with
the IGC to One Million Dollars ($1,000,000), and, subject to clause (ii) of this
Section 11, the Units hereby agree to cooperate with and support the Developer
in connection with such request to the IGC; (ii) the Developer hereby agrees to
provide a bond, furnished in one or a combination of the forms described for
bonds on deposit with the IGC under I.C. 4-33-6-9(b), held by and payable to the
City and maintained in the amount of Three Million Dollars ($3,000,000) for
purposes of securing the execution and delivery of the EJ&E Agreement, as
defined in the Agreement, and the completion of the construction of the railroad
crossing contemplated thereby (collectively, the "EJ&E Obligations") and the
Developer's obligations under Section 3.03 of the Agreement; and (iii) upon
satisfaction of the EJ&J Obligations, the bond referenced in clause (ii) of this
Section 11 will be reduced to One Million Dollars ($1,000,000.00) and shall
continue to secure the Developer's Obligations under Section 3.03 of the
Agreement.

               12. Force Majeure. The parties acknowledge that the dates and
deadlines set forth in this Fourth Amendment (other than for the payment of
money) are subject to the provisions of Section 18.04 of the Agreement.


                                     HORSESHOE HAMMOND, INC.,
                                     f/k/a EMPRESS CASINO HAMMOND CORPORATION




                                     By:
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                                       CITY OF HAMMOND, INDIANA



                                       By:
                                           -------------------------------------
                                           Duane W. Dedelow, Jr., Mayor


               The City of Hammond, Department of Redevelopment hereby executes
this Fourth Amendment as of the day and year first written above solely for the
purpose of such authorizations as may be required by it.

                                     CITY OF HAMMOND, DEPARTMENT
                                     OF REDEVELOPMENT


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               The City of Hammond Port Authority hereby executes this Fourth
Amendment as of the day and year first written above solely for the purpose of
such authorizations as may be required by it.

                                     CITY OF HAMMOND PORT AUTHORITY



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               The City of Hammond Redevelopment Authority hereby executes the
Fourth Amendment as of the day and year first written above solely for the
purpose of such authorizations as may be required by it.

                                     CITY OF HAMMOND REDEVELOPMENT AUTHORITY




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                                      -14-
<PAGE>
EXHIBIT "D"

                                HORSESHOE HAMMOND

                              PROPOSED PARKING PLAN



                                      -15-
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I.      IMMEDIATELY AFTER EXECUTION OF THE FOURTH AMENDMENT.

        A.      Area A as shown on Exhibit E ("Area A"): Area A shall be
                reserved exclusively for (i) the patrons of the Hammond Marina
                ("Marina") during boating season (March 15 to October 31),
                except if during this period patrons of the Marina are not
                utilizing all of the available spaces, the Hammond Port
                Authority shall, in its reasonable judgment, allow the Developer
                to occupy the unused portion of Area A for its patrons and
                employees, and (ii) patrons or employees of the Developer at all
                other times.

        B.      Area B as shown on Exhibit F ("Area B"): Area B shall be
                reserved exclusively for valet parking for the Developer's
                patrons and for the Developer's patrons and employees when not
                needed for valet patrons.

        C.      Area C as shown on Exhibit G ("Area C"): Area C shall be
                reserved for the exclusive use of the beach patrons and members
                of the general public (excluding patrons and employees of
                Developer) between Memorial Day and Labor Day and for the
                general public (including patrons and employees of Developer) at
                all other times; provided that after the second full season
                (i.e. 2001) that the public beach is open, the parties shall
                determine in good faith the extent to which Area C is reasonably
                required for parking of beach patrons and members of the general
                public (excluding patrons and employees of the Developer) and
                shall identify in writing that portion of Area C, if any, which
                is not so required, which area shall then be treated for all
                purposes as part of Area B.

II.     AFTER THE LATER OF: (a) THIRTY (30) DAYS AFTER THE EXERCISE OF THE
        OPTION FOR THE VALET PARKING AREA, AND (b) THE OPENING OF THE PERMANENT
        RAMP, BUT IN EITHER CASE, PRIOR TO CONSTRUCTION OF ANY PARKING STRUCTURE
        ON THE VALET PARKING AREA.

        A.      Area A : Area A shall be reserved exclusively for the patrons of
                the Marina and members of the general public (excluding patrons
                and employees of the Developer) at all times.

        B.      Area B : The northern 262 spaces as shown on Exhibit B ("Area
                B-1"): Area B-1 shall be reserved exclusively for the patrons of
                the Marina and members of the general public (excluding patrons
                or employees of the Developer) at all times.

                B2 -- The southern 100 spaces as shown on Exhibit B ("Area B-2):
                Area B-2 shall be reserved exclusively for the patrons and
                employees of the Developer at all times.




                                      -16-
<PAGE>
        C.      Area C : Area C shall be reserved exclusively for the patrons of
                the Marina and members of the general public (excluding patrons
                and employees of the Developer), at all times.

        D. The Developer shall restripe the Option Area to add the twenty-two
(22) additional parking spaces depicted on the site plan attached hereto as
Schedule III and construct the additional thirty-two (32) parking spaces in
accordance with and as depicted on the site plan attached hereto as Schedule
III.

III.    AFTER CONSTRUCTION OF A PARKING STRUCTURE ON THE VALET PARKING AREA.

        A.      Area A: Area A shall be reserved exclusively for the patrons of
                the Marina and members of the general public (excluding patrons
                and employees of the Developer) at all times.

        B.      Area B: Area B-1 : Area B-1 shall be reserved exclusively for
                the patrons of the Marina and members of the general public
                (excluding patrons or employees of the Developer) at all times.

                Area B-2: Area B-2 shall be reserved exclusively for the patrons
                and employees of the Developer at all times.

        C.      Area C: Area C shall be reserved exclusively for the patrons of
                the Marina and members of the general public (excluding patrons
                and employees of the Developer) at all times.


D. PARKING GARAGE: 262 SPACES SHALL BE RESERVED ON THE 1ST FLOOR OF THE PARKING
STRUCTURE FOR THE PORT AUTHORITY FROM MARCH 15 TO OCTOBER 31 FOR ALLOCATION TO
MARINA PATRONS; THE SPACES RESERVED FOR MARINA PATRONS SHALL BE LOCATED IN AN
AREA SEGREGATED FROM ALL OTHER PARKING SPACES IN THE PARKING STRUCTURE; AND ANY
PARTIES USING SUCH SPACES SHALL BE ADMITTED BY WAY OF A SEPARATE DESIGNATED
VEHICLE ENTRANCE ON THE WEST SIDE OF THE STRUCTURE AND VIA PARKING PERMITS OR
PASSES.



                                      -17-