EXHIBIT 10.40





                                           BI-LATERAL AGREEMENT



         THIS BI-LATERAL AGREEMENT (this "Agreement"), dated as of May 23, 1997,
by and between International  Thoroughbred Breeders, Inc. a Delaware corporation
("ITB"),  and Las Vegas  Entertainment  Network,  Inc.,  a Delaware  corporation
("LVEN") with reference to the following:



         (a) that certain Loan Agreement, dated as of even date herewith, by and
among ITB, certain of ITB's  subsidiaries  (together with ITB, the "Borrowers"),
and  Credit  Suisse  First  Boston  Mortgage  Capital  LLC  ("CSFB")  (the "Loan
Agreement"),



         (b) that certain Tri-Party  Agreement,  dated as of even date herewith,
by and among LVEN, ITB, and CSFB (the "Tri-Party Agreement"), and



         In order to induce ITB and LVEN to enter into the Tri-Party  Agreement,
ITB and LVEN each have agreed to set forth their further agreement as follows:



         1. In the event that the Permitted Acquisition (as that term is defined
in the Tri-Party  Agreement) is not  consummated  for any reason the  respective
rights and obligations of LVEN, Casino- Co Corporation  ("Casino-Co"),  ITB, and
Orion Casino  Corporation  ("Orion")  with  respect to the profit  participation
payable to Casino-Co  pursuant to Section 2(c) of that certain Letter  Agreement
dated as of January 22, 1996, by and among such parties (the "Letter Agreement")
are hereby confirmed and/or clarified, and restated as follows:



         For  purposes  of  computing  the  Adjusted  Cash Flow (as that term is
defined  in the Letter  Agreement)  amounts of which  Casino-Co  initially  will
receive  a  fifty  percent  (50%)  interest,   and  thereafter  will  receive  a
twenty-five percent (25%) interest, subject to the other terms and conditions of
the Letter  Agreement,  (i) the term  Adjusted Cash Flow shall mean and refer to
adjusted  cash flow from the  operation of the Property (as that term is defined
in the Letter  Agreement),  before any  provision  for  federal or state  income
taxes,  depreciation  and/or  amortization,  and (ii)  without  the  consent  of
Casino-Co,  the  amount  of debt  service  to be netted  against  cash flow from
operations of the Property in computing Adjusted Cash Flow shall be limited to a
maximum of $65  Million.  At the time of the closing of the $55 Million  loan by
CSFB under the Loan Agreement (the "CSFB Loan") the amount of debt service to be
netted against cash flow from  operations in computing  Adjusted Cash Flow shall
be $27 Million.  The parties agree that, as of the date hereof, the amount which
Orion is  entitled  to recoup  pursuant  to clause (i) of the third  sentence of
Section 2(c) of the Letter Agreement is $35 Million.

                                       er.
                                      -er-

<PAGE>



         2. ITB agrees that the CSFB Loan has been  arranged by Casino-Co as the
"Alternative  Financing"  contemplated  by, pursuant to, and in satisfaction of,
the provisions of Section 2(b)(z) of the Letter  Agreement;  provided,  however,
that LVEN (for itself and on behalf of Casino-Co)  acknowledges  and agrees that
no fee or commission is payable to anyone in connection therewith.



         3. If,  within 90 days of the date  hereof,  ITB has not  received  the
proceeds of a  construction  loan of $50  Million,  or more,  respecting  the El
Rancho Property,  or has not otherwise  arranged  alternative  financing for the
opening  of the hotel and casino at the El Rancho  Property,  and if and only if
the Permitted Conversion and Permitted Acquisition have not occurred,  then LVEN
shall have the right,  for a period of 180 days,  to make a $30 Million  loan to
Orion the  proceeds  of which would be used to repay a portion of the CSFB Loan.
If it were to make such a $30 Million  loan to Orion,  the loan would  mature on
the date that the CSFB Loan is  scheduled  to mature and would bear  interest at
the rate  applicable  to the CSFB  Loan.  ITB  agrees  with LVEN (for  their own
benefit and not for the benefit of CSFB) that, in such circumstances,  ITB would
be obligated to prepay the balance of the indebtedness owed to CSFB with respect
to the CSFB Loan  (including  principal,  interest,  premium,  exit fees,  fees,
costs,  and expenses).  Any financing  arranged by ITB for the prepayment of the
CSFB Loan would be entitled to obtain a first lien on ITB's subsidiary's  Garden
State Race Track and a second  lien  (junior to the lien of Mr. Ken  Fischer) on
ITB's  subsidiary's  Freehold  Race Track and a second  lien  (junior to the $30
Million loan made by LVEN) with respect to the El Rancho Property. If LVEN makes
the $30 Million loan to Orion and ITB prepays the balance of the CSFB Loan,  the
$30 Million loan by LVEN to Orion would be secured by a first  priority  lien on
the El Rancho Property,  and LVEN would thereafter have the right to oversee the
development  of the El Rancho  Property  (without  any  change in  ownership  or
economics).



         4. If LVEN is  unsatisfied  with the fair market  value of Casino-Co as
established  by the greater of the ITB Value or the LVEN Value,  LVEN shall have
the  right,  within  180  days of the date  hereof,  to make a loan to ITB in an
amount sufficient to repay in full the CSFB Loan and the proceeds of which would
be used to repay the CSFB  Loan in full.  If it were to make such a loan to ITB,
the loan would  mature on the date that the CSFB Loan is scheduled to mature and
would bear  interest at the rate  applicable  to the CSFB Loan.  ITB agrees with
LVEN (for  their own  benefit  and not for the  benefit of CSFB)  that,  in such
circumstances, ITB would be obligated to use such loan proceeds to prepay all of
the  indebtedness  owed  to  CSFB  with  respect  to the  CSFB  Loan  (including
principal,  interest,  premium, exit fees, fees, costs, and expenses).  Any such
loan  made by LVEN to ITB  would be  entitled  to  obtain a first  lien on ITB's
subsidiary's  Garden State Race Track,  a second lien (junior to the lien of Mr.
Ken  Fischer)  on ITB's  subsidiary's  Freehold  Race  Track,  and a first  lien
(assuming the Conversion has occurred) with respect to the El Rancho Property.

                                       er.
                                      -er-

<PAGE>



         5. As a result of  changes in the  development  plans for the El Rancho
Property,  and as a material inducement to LVEN to enter into this Agreement and
the  Subordination   Agreement,   LVEN  and  ITB  have  agreed  to  cause  their
subsidiaries  to amend and restate the  Entertainment  Management  Agreement (as
defined  in the  Letter  Agreement)  to  reflect  the scope  and  nature of such
changes,  it being the  intention of such parties to effect,  upon  commercially
reasonable  terms and  conditions,  the leasing by Orion to LVCC of space within
the El Rancho  Property of space on or from which all food,  beverage and retail
activities will be conducted  (exclusive of certain  mezzanine space, the rights
to which will be  retained  by Orion.  LVEN and ITB hereby  agree to cause their
subsidiaries to embody such  modifications  in definitive  documentation  at the
earliest practicable time.



         6. If any legal action or  proceeding is brought by any party hereto to
enforce or construe a provision of this  Agreement,  the  unsuccessful  party in
such action or proceeding,  irrespective  of whether such actin or proceeding is
settled  or  prosecuted  to  final  judgment,  shall  pay all of the  reasonable
attorneys fees and costs incurred by the prevailing party.



         7. No amendment,  modification,  supplement,  termination,  consent, or
waiver of or to any provision of this Agreement nor any consent to any departure
therefrom  shall in any event be  effective  unless the same shall be in writing
and signed by or on behalf of each of the parties hereto.



         8. This  Agreement is intended by the parties as a final  expression of
their  agreement and is intended as a complete and  integrated  statement of the
terms and conditions of their agreement.



         9. This Agreement may be executed in any number of  counterparts,  each
of which shall be deemed to be an original, admissible into evidence, and all of
which  together  shall be  deemed  to be a  single  instrument.  Delivery  of an
executed counterpart of this Agreement by telefacsimile shall be as effective as
delivery of a manually  executed  counterpart.  Any party delivering an executed
counterpart  of this  Agreement by  telefacsimile  also shall deliver a manually
executed  counterpart of this  Agreement,  but the failure to deliver a manually
executed counterpart shall not affect the validity,  enforceability, and binding
effect of this Agreement.

                                       er.
                                      -er-

<PAGE>



                  IN WITNESS  WHEREOF,  the parties have  executed and delivered
this Agreement as of the date first written above.





          LAS VEGAS
          ENTERTAINMENT

          NETWORK, INC.





       By: /s/JOSEPH A. CORAZZI



       Title: Chairman/CEO







             INTERNATIONAL
             THOROUGHBRED BREEDERS,
             INC.







             By: /s/Nunzio DeSantis
               Title: CEO


           

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