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                                                                   Exhibit 10.24
 
                             EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT (this "Employment Agreement") entered into as of 
January __, 1999, by and between Horseshoe Gaming, Inc., a Nevada Corporation 
("Employer"), and Peter A. Ferro, Jr. ("Employee").

                                   RECITALS

     WHEREAS, Employer is the Manager of Horseshoe Gaming, LLC, a Delaware
limited liability company (the "LLC), whose subsidiaries and affiliates have
developed and are currently operating casino and hotel facilities in Tunica,
Mississippi (the "Tunica Facility") and in Bossier City, Louisiana (the "Bossier
City Facility" and, together with the Tunica Facility, referred to as the
"Existing Facilities"), and who is party to an agreement to acquire additional
casino and hotel facilities in Hammond, Indiana (the "Hammond Facility") and
Joliet, Illinois (the "Joliet Facility" and, together with the Hammond Facility,
referred to as the "To be Acquired Facilities"); and

     WHEREAS, on the Acquisition Date (as defined below) Employer desires to
employ Employee, and Employee desires to accept such employment, pursuant to the
terms of this Employment Agreement.

     NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, and in consideration of the mutual
covenants, promises and agreements herein contained, the parties hereto agree as
follows:

                                   AGREEMENT

     1. Definitions. All capitalized words referenced or used in this Employment
Agreement and not specifically defined herein shall have the meaning set forth
on Exhibit A, which is attached hereto and by this reference made a part hereof.

     2. Term. This Employment Agreement shall become effective on the
Acquisition Date (the "Commencement Date") and shall continue in effect for a
period terminating December 31, 2001, unless terminated sooner by Employer or
Employee pursuant to the terms set forth herein.

     3. Position to be Held by Employee. Employee is hereby employed and hired
by Employer to serve and act as the Executive Vice President of Employer, and
shall perform each and all of the duties and shall have all of the
responsibilities described here. Employee shall at all times report directly to
and take directives from the President and Chief Executive Officer of Employer
(the "CEO"). Any and all directives of the CEO will take precedence over and
override any directives of the President which directly or indirectly conflict
with those of the CEO.

     4. Duties and Responsibilities.

          A. General Duties. In his capacity as Executive Vice President of
Employer, Employee shall have the responsibility for (1) overseeing the
operations of the Existing Facilities and


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the To Be Acquired Facilities and assisting in the opening of any casino and
hotel facilities to be developed and/or acquired by subsidiaries or affiliates
of the LLC (together with the Existing Facilities and the To Be Acquired
Facilities each referred to individually as a "Facility" and collectively as the
"Facilities") in a manner so as to maximize, to the best of his ability, the
profitability of each Facility, for and on behalf of the LLC in accordance with
applicable laws and regulations and (2) to work with the President and CEO and
perform such duties as may be assigned to him from time to time by them. The
authority of Employee to bind Employer shall be as broad or as limited as may be
determined from time to time by the CEO or the Board of Directors of Employer
(the "Board").

          B. Specific Duties. Employee's specific duties shall include, but not
be limited to, strategic planning and development, overseeing capital
management, directing development and construction for new and existing
operations and oversight for capital budgeting, financial planning, regulatory
and legislative affairs of the Employer and its related and affiliated
companies. Employee acknowledges and agrees, however, that in connection with
his employment he may be required to travel on behalf of Employer.

          C. Fiduciary Duty. In every instance, Employee shall carry out his
various duties and responsibilities in a fiduciary capacity on behalf of
Employer, in an effort to maximize the profitability of Employer. Except for the
manner provided in Subsection 4(C)(i) and (ii), in no event whatsoever shall
Employee enter into any commitments or obligations, written or verbal, or take
or omit to take any other action, the result of which would be to create a
conflict of interest between Employer and Employee, or the result of which would
(directly or indirectly) benefit Employee, any person or entity associated with
or affiliated with Employee, or any person or entity in any manner involved in
the gaming industry to the detriment of Employer. In all instances, Employee
shall perform his services and oversee his department(s) in a thorough,
competent, efficient and professional manner. Employer acknowledges and agrees
that Employee presently serves and may continue to serve as director, officer
of, and is an investor in Empress Entertainment, Inc. and certain subsidiaries
and affiliates of Empress Entertainment, Inc. (collectively, "Empress").
Employee represents and warrants that his position and involvement in Empress
does not, in any way, breach or violate the terms of this Employment Agreement
in any way. Employer is aware of and acknowledges that Employee is currently
pursuing certain gaming opportunities in Wyandotte County, Kansas and in Jackson
County, Missouri ("Kansas Opportunity") and that pursuit of the Kansas
Opportunity is not a breach or violation of Employee's duties under this
Employment Agreement. Employee covenants and agrees that in the event that
Employee's involvement in Empress would, in the sole discretion of Employer,
breach this Employment Agreement in any way, Employee would upon notice from
Employer of such a breach, immediately resign from any and all positions with
Empress and divest himself of any interest, equity or otherwise, or any
relationship with Empress or resign from his employment with Employer.

               i Gaming Opportunity. Employee shall, upon learning, other than
from Empress or its board officers or directors, of a gaming opportunity which
includes, but is not limited to, any opportunity to open a casino style gaming
facility, the operation of slot machines or the operation of video poker
machines (each, an "Opportunity"), submit a written report to the Employer

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evaluating the feasibility and profitability of the Opportunity (the "Report"). 
Within sixty (60) days of Employer's receipt of the Report Employer shall 
express, in writing, Employer's intent to pursue the Opportunities (such 
opportunity being an "Accepted Opportunity"). In the event that the Employer 
fails to indicate its intent to pursue the Opportunity within sixty (60) days of
receipt of the Report, the Employer shall be deemed to have waived, in writing, 
its intent to pursue this Opportunity. In the event that the Employer indicates,
in writing, as required herein, an intent to pursue the Opportunity, the 
Opportunity shall be subject to the provisions of Subsection 11(A) hereof.

               ii.  Rejection of a Gaming Opportunity. In the event that
Employer declines an Opportunity properly presented to it by Employee as
described in Subsection 4(C)(i) ("Declined Opportunity"), Employee may invest in
such Opportunity and serve as a member of the Board of Directors or in a similar
capacity in any entity formed to pursue such Opportunity and such action shall
not be deemed a violation of Subsections 4(C), 4(D) or Section 11 of this
Employment Agreement, provided however, that such entity, its subsidiary or
affiliates does not expand or venture into any other Opportunities at a new
location without Employee first offering such Opportunity to Employer in the
manner described in Section 4(C)(i).

          D. Full-time Effort. Employee acknowledges and agrees that the duties 
and responsibilities to be discharged by Employee require a full-time effort on 
the part of Employee, and accordingly, Employee agrees to devote his full-time 
effort and resources for and on behalf of Employer, and agrees that he will not,
during the term hereof, enter into (directly or indirectly) any other business
activities or ventures, other than (a) an investment which is passive in nature 
and does not otherwise violate any of the terms of this Employment Agreement; 
(b) the activity permitted in Subsections 4(C)(i) and (ii) herein; or (c) the 
act of serving as a Member of the Board of Directors or in a similar capacity of
any entity not involved either directly or indirectly in casino gaming 
including, but not limited to, the operation of slot machines and video poker.

          E. Directives from the President and CEO. In all instances, Employee
agrees to carry out all of his duties and responsibilities as set forth herein
pursuant to the guidance, directives and instructions of the President and CEO
and agrees that at all times his authority shall be subordinate to that of the
President and CEO. The wishes and directives of the President and CEO shall
prevail in all matters and decisions as to which there is a disagreement between
Employee and either the President or CEO, and Employee shall carry out any and
all lawful directives from the President and CEO to the best of his ability. In
the event that wishes or directives of the President and CEO directly or
indirectly conflict, the wishes and directives of the CEO will take precedent
over and override any and all directives of the President.

     5.   Compensation. As compensation for the services to be rendered by 
Employee pursuant to the terms of this Employment Agreement, Employee shall be 
entitled to receive the following:

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          A.    a base salary of Four Hundred Thousand Dollars ($400,000.00) per
year, which may be adjusted annually by a merit increase based upon Employer's 
existing policy and an annual performance appraisal of Employee and Employer and
the LLC (the "Base Compensation") which appraisals shall be performed in a 
manner suitable to Employer in all respects, and which shall be payable in equal
semi-monthly installments;


          B.    a discretionary bonus in an amount determined in accordance with
Employer's bonus plan, as may be amended from time to time by Employer in 
Employer's sole discretion, (the "Bonus"), which shall not exceed 50% of 
Employee's Base Compensation at the time such Bonus is awarded; and


          C.    the right to participate in any employee stock option or stock
purchase plan that may be adopted by Employer for its executive level employees
and the executive level employees of its gaming subsidiaries (and, at Employer's
sole discretion, for executive level employees of other gaming operations
principally owned or controlled by Jack B. Binion), such participation to be at
a level commensurate with that of other executives performing similar duties and
at a similar compensation level as that of Employee.


     6.    Fringe Benefits.  It is understood and agreed that the Base 
Compensation to be received by Employee is to be all-inclusive of other typical 
fringe benefits provided to executives in a similar position as Employee; 
provided, however, that Employee shall be entitled to the following benefits:


          A.    reimbursement, on an on-going basis, for all reasonable
entertainment, traveling and other similar expenses incurred in the performance
of his duties and responsibilities hereunder, such expenses to be subject to
budgets established for such purpose and the Employer's reimbursement
procedures;


          B.    participation in Employer's health coverage plan for Employee 
and all members of his immediate family, with such plan and the terms of 
Employee's participation in such plan to be on terms and conditions determined 
solely by Employer;


          C.    participation in such pension plans as Employer shall adopt for 
all of its employees; it being understood and agreed that the only pension plan 
that Employer has adopted at this time is a Section 401(k) form of pension plan;


          D.    business and personal use of a company vehicle;


          E.    participation in Employer's "Paid Days Off/Vacation" policy;


          F.    reimbursement for the cost of maintaining and carrying
Employee's portable disability insurance policy Employee previously received
from Empress; and

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          G.    reimbursement for the cost of maintaining a Two Million Dollar 
($2,000,000) term life insurance policy insuring the life of Employee provided 
that Employee remains insurable at the rate generally established by major life 
insurance companies for term life insurance policies for persons in good health 
and the same age as Employee; and provided further that if Employee is rated in 
a higher risk category said policy shall nevertheless be made available but 
Employer shall only be obligated to pay the premium payable by a person in good 
health and all premiums in excess of such amount shall be paid Employee.


     7.    Indemnification.


          A.    Indemnification of Employee by Employer. In addition to all
indemnities available under Employer's Articles of Incorporation and Bylaws, the
Employer hereby further agrees to hold harmless and indemnify Employee: (i)
against any and all expenses (including attorney's fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by Employee in
connection with any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (including an action by
or in the right of Employer) to which Employee is, was or at any time becomes
a party or is threatened to be made a party, by reason of fact that Employee
is, was or at any time becomes a director, officer, employee or agent of
Employer, or is or was serving or any time serves at the request of Employer as
a director, officer, employee or agent of any of Employer's direct or indirect
subsidiaries, another corporation, partnership, joint venture, trust or other
enterprise, and (ii) to the fullest extent as may be required under applicable
law. Employer shall cause Employee to be covered by the current policies of
directors' and officers' liability insurance covering directors and officers of
Employer in accordance with their terms, to the maximum extent of the coverage
available for any director or officer of Employer. Employer shall use
commercially reasonably efforts to cause the policies of directors' and
officers' liability insurance covering directors and officers of Employer to be
maintained throughout the term of Employee's employment with Employer.


          B.    Indemnification of Employer by Employee. Employee shall
indemnify Employer against any and all expenses, costs (including attorney's
fees), judgments, losses, fines and amounts paid in settlement actually and
reasonably incurred by Employer in connection with arising out of or in any way
related to any threatened, pending or completed action, suit or proceeding
pursued by or on behalf of Empress, its subsidiaries or any entity in which the
Employee is an owner or investor (all such entities referred to as the "Empress
Entities"), whether civil, criminal, administrative or investigative to which
Employer is, was or at any time becomes a party, or is threatened to be made a
party, as a result of, arising out of or in any way related to (i) events which
occurred during the term of this Employment Agreement or are in any way related
to the period of time comprising the term of this Employment Agreement, and (ii)
are in any way related to Employee's employment, board or officer position with,
ownership interest in or duties and obligations to any of the Empress Entities;
provided, however, this indemnification shall not obligate Employee to indemnify
Employer for any obligation of Employer stemming from Employer's written
agreement creating an obligation or a duty of Employer to the Empress Entities.

                                      -5-
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     8.    Gaming License. Employer and Employee understand that it shall be
necessary for Employee to obtain and maintain in full force and effect at all
times, gaming licenses required by each of the various jurisdictions in which
subsidiaries or affiliates of the LLC are conducting gaming operations.
Accordingly, during the course of his employment, Employee agrees to use his
best efforts to obtain and maintain such licenses, to fully cooperate in the
investigation or investigations to be conducted in connection therewith and
otherwise to fully comply with all requirements of applicable Gaming Authorities
and Governmental Authorities.


     9.    Termination.

          A.    Termination With Cause. Employer may terminate Employee for
"cause" as provided in this Section 9. For purposes of this Employment Agreement
"cause" means the occurrence of one or more of the following events:


               i    The failure of Employee to obtain any of the gaming licenses
required pursuant to Section 8 within a reasonable period of time following
employment or the revocation, suspension or failure to renew for a period in
excess of ninety (90) days, of any such gaming license due to an act or omission
of Employee (or such alleged act or omission) upon which the Gaming Authorities
or Governmental Authorities have based their determination to revoke, suspend or
fail to renew any gaming license;

               ii   failure or refusal by Employee to observe or perform any of 
the provisions of this Employment Agreement or any other written agreement with 
Employer, or to perform in a reasonably satisfactory manner all of the duties 
required of Employee under this Employment Agreement or any other written 
agreement with Employer;


               iii  commission of fraud, misappropriation, embezzlement or other
acts of dishonesty, or conviction for any crime punishable as a felony or a
gross misdemeanor involving dishonesty or moral turpitude;


               iv   the use of illegal drugs while on duty for Employer or on 
premises of any Facility;


               v    unreasonable refusal or failure to comply with the proper 
and lawful directives of and/or procedures established by the CEO or the Board 
of Directors of Employer (or persons of comparable position); and/or


               vi   the death of Employee or the mental or physical disability 
of Employee to such a degree that Employee, in the reasonable judgment of a 
licensed physician retained by Employer, is unable to carry out all of his 
obligations, duties and responsibilities set forth herein for a period in excess
of sixty (60) days.


 

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     Termination of Employee's employment for cause under Subsections 9(A)(i),
9(A)(iii), 9(A)(iv) or 9(A)(vi) above shall be effective immediately upon notice
thereof by Employer to Employee. Termination of Employee's employment for cause
under Subsections 9(A)(ii) or 9(A)(v) above shall be effective upon fourteen
(14) days' prior notice thereof by Employer to Employee, provided, however, that
Employee shall have fourteen (14) days from the date of the notice of a
violation of subsection 9(A)(ii) or 9(A)(v) in which to cure any default, unless
such act is also a basis for termination under any of subsections 9(A)(i),
(iii), (iv) or (vi) in which case termination shall be immediate. The factual
basis for termination for cause shall be included within such notice of
termination.

          B.   Termination for Cause, Resignation or Expiration of Term. Upon
termination of Employee's employment with Employer (i) by Employer for cause
(ii) upon the resignation of Employee or (iii) upon the expiration of the term
of this Employment Agreement, employee shall be paid his Base Compensation
through the effective date of the earliest to occur of termination, resignation
or expiration of the term.

          C.   Termination Without Cause. Employer in its discretion may
terminate Employee at any time without cause upon thirty (30) days' prior
written notice to the Employee. If Employee is terminated by Employer without
cause, Employee shall continue to receive for a period of time equal to the
balance of the term of this Employment Agreement: (1) the Base Compensation
(payable as provided in Subsection 5(A)), provided, however, all Fringe Benefits
(other than the health insurance coverage described in Subsection 9(C)(2))
described herein, or otherwise provided to Employee shall terminate immediately
and Employee shall be entitled to a pro rata Bonus and (2) health insurance
provided to the Employee and members of his immediate family under the health
insurance program provided by Employer to its senior executive officers so long
as Employee makes any required employee contributions therefor.

               i    Employee Option Upon Termination Without Cause. In the event
of termination without cause, Employee may, at his sole discretion, refuse the
receipt of his Base Compensation which would be paid to him as described in
Section 9(C) above. This option must be exercised in writing and delivered to
the Employer during the thirty (30) day period immediately following the receipt
of written notice by the Employee of termination without cause. Upon exercise of
this option, the one (1) year period of time during which Employee is prohibited
from soliciting other employees or competing with Employer, as more fully
described herein, shall begin immediately.

     10.  Survival of Certain Covenants. The covenants not to compete, solicit
or hire and the confidentiality agreements set forth in Sections 11 and 12
herein below shall continue to apply beyond termination in the manner and to the
extent set forth herein.

     11.  Covenants Not to Compete, Solicit or Hire.

          A.   Covenant Not to Compete. For so long as the Employee is receiving
Base Compensation and for a period of one (1) year from and after the last date
on which any amount

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constituting Base Compensation is paid to Employee, Employee agrees that he will
not directly or indirectly, whether as principal, manager, agent, consultant,
officer, director, stockholder, partner, investor, lender or employee, or in any
other capacity, carry on, be engaged in or employed by or be a consultant to or
to have any financial interest in any other casino operation conducting business
within one hundred (100) miles of (i) any gaming facility principally owned or
controlled by Jack B. Binion, Employer, or Employer's subsidiaries or related
companies, including, but not limited to, the Existing Facilities or the To Be
Acquired Facilities, or (ii) any Accepted Opportunity (a) such gaming facility
or Accepted Opportunity is or would be located in any of Las Vegas, Reno, Lake
Tahoe, Atlantic City, Jackson County, Missouri or Wyandotte County, Kansas; (b)
such interest is not more than 2% passive interest in any publicly traded
entity; (c) such interest is an ownership interest in any gaming facility owned
wholly or in part by Jack B. Binion, Employer or Employer's subsidiaries or
related companies; or (d) operated by Jack B. Binion, Employer or Employer's
subsidiaries or related companies. Employer and Employee agree that such
covenant not to compete is a condition of Employee's employment and that the
covenant not to compete has been given by Employee to Employer for full and
adequate consideration.

          B.   Covenant Not to Solicit or Hire. For so long as the Employee is
receiving Base Compensation and for a period of one (1) year from and after the
last date on which any amount constituting Base Compensation is paid to
Employee, Employee agrees that he will not, directly or indirectly, hire, retain
or solicit, or cause any other employer of his or any other person who has
retained Employee as a consultant or independent contractor to hire, retain or
solicit, as an employee, consultant, independent contractor in a supervisory
capacity or otherwise any person who was at any time during the period
commencing on the date three (3) months prior to the Commencement Date and
ending on the date of the termination of Employee's employment hereunder an
employee of or consultant or independent contractor to Employer, the LLC or any
other gaming operations principally owned or controlled by Jack B. Binion,
Employer, or Employer's subsidiaries or related companies, including, but not
limited to, the Existing Facilities or the To Be Acquired Facilities.

     12.  Nondisclosure of Confidential Information.

          A.   Definition of Confidential Information. For purposes of this
Employment Agreement, "Confidential Information" means any information that is
not generally known to the public that relates to the existing or reasonably
foreseeable business of Employer. Confidential Information includes, but is not
limited to, information contained in or relating to the customer lists, account
lists, price lists, product designs, marketing plans or proposals, acquisition
or growth plans or proposals, customer information, merchandising, selling,
accounting, finances, knowhow, trademarks, trade names, trade practices, trade
secrets and other proprietary information of Employer.

          B.   Employee Shall Not Disclose Confidential Information. Employee
shall not, during the term of Employee's employment and following the
termination of this Employment Agreement until such time as the confidential
information becomes generally known to, or readily ascertainable by proper means
by, the public, use, show, display, release, discuss, communicate,

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divulge or otherwise disclose Confidential Information to any unauthorized
person, firm, corporation, association or other entity for any reason or purpose
whatsoever, without the prior written consent or authorization of Employer.
Nothing contained herein shall be interpreted or construed as restraining or
preventing Employee from using Confidential Information in the proper conduct of
services to be rendered by Employee on behalf of Employer pursuant to this
Employment Agreement. Mistake or lack of knowledge as to the status of
information wrongly disclosed or used by Employer shall not serve as a defense
to breach of this Employment Agreement.


          C.    Scope.  Employee's covenant in Subsection 12(B) above not to
disclose Confidential Information shall not apply to information which, at the
time of such disclosure, may be obtained from sources other than from Employer,
or its agents, lawyers or accountants, provided however, that such information
which may be obtained from sources other than from Employer, or its agents,
lawyers or accountants is not obtained from sources which received the
information in an improper manner or against the wishes of Employer.


          D.    Title.  All documents and other tangible or intangible property
relating in any way to the business of Employer which are conceived or generated
by Employee or come into Employee's possession during the employment period
shall be and remain the exclusive property of Employer, and Employee agrees to
return immediately to Employer, upon its request, all such documents and
tangible and intangible property, including but not limited to, all records,
manuals, books, blank forms, documents, letters, memoranda, notes, notebooks,
reports, data, tables, magnetic tapes, computer disks, calculations or copies
thereof, which are the property of Employer and which relate in any way to the
business, customers, products, practices or techniques of Employer, as well as
all other property of Employer, including but not limited to, all documents
which in whole or in part contain any Confidential Information of Employer which
in any of these cases are in Employee's possession or under Employee's control.


          E.    Compelled Disclosure.  In the event a third party seeks to
compel disclosure of Confidential Information by Employee by judicial or
administrative process, Employee shall promptly notify Employer of such
occurrence and furnish to Employer a copy of the demand, summons, subpoena or
other process served upon Employee to compel such disclosure, and will permit
Employer to assume, at its expense, but with Employee's full cooperation,
defense of such disclosure demand. In the event that Employer refuses to contest
such a third party disclosure demand under judicial or administrative process,
or a final non-appealable judicial judgment is issued compelling Employee to
disclose Confidential Information, Employee shall be entitled to disclose such
information in compliance with the terms of such administrative or judicial
process or order.


     13.    Reasonableness of Terms.  The Employer and the Employee stipulate
and agree that the terms and covenants contained in Section 11 and Section 12
herein are fair and reasonable in all respects, including the time period and
geographical coverage in Section 11, and that these restrictions are designed
for the reasonable protection of the Employer's business and Employer's
legitimate interests therein. In the event that these restrictions are found to
be overly broad or unreasonable, the Employer and the Employee agree that such
restrictions shall be severable and


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enforceable on such modified terms as may be deemed reasonable and enforceable
by a court of competent jurisdiction.

     14. Representations and Warranties.

     Employee hereby represents and warrants to Employer, LLC and its affiliated
or related entities that:

          A. the execution, delivery and performance by Employee of this
Employment Agreement will not conflict with, violate the terms of or create a
default under any other agreement by which Employee is bound, including without
limitation Employee's present employment or similar agreements, whether oral or
written;

          B. no Gaming Authority or other Governmental Authority has ever denied
or otherwise declined to issue any gaming license or related authorization
applied for by Employee;

          C. Employee is not aware of any facts which, if known to any Gaming
Authority or other Governmental Authority, would cause the refusal of his
application for any gaming licenses required to be obtained by Employee pursuant
to Section 8;

          D. Employee is not aware of any mental, physical or emotional
condition which currently affects Employee, and which might result in Employee's
being unable to carry out all of his duties, obligations and responsibilities
set forth herein;

          E. Employee understands and agrees that Employer is entering into this
Employment Agreement in strict reliance upon the representations and warranties
of Employee set forth herein, and that a breach of any of said representations
and warranties by Employee would constitute a default hereunder, and

          F. Employee has received and reviewed Employer's "Paid Days
Off/Vacation" policy and understands and agrees to its terms.

     15. Entire Agreement. This Employment Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter set forth
herein, and supersedes any and all previous oral or written agreements,
understandings or discussions between the parties hereto with respect to the
subject matter set forth herein with respect to the employment of Employee.

     16. All Amendments in Writing. This Employment Agreement may be amended
only pursuant to a written instrument executed by Employer and Employee. It
shall not be reasonable for either Employer or Employee to rely on any oral
statements or representations by the other party that are in conflict with the
terms of this Employment Agreement.

     17. Arbitration. In the event of any dispute or controversy between
Employer and Employee with respect to any of the matters set forth herein, both
Employer and Employee agree to submit such dispute or controversy to binding
arbitration, to be conducted in Las Vegas, Nevada pursuant to the then
prevailing rules and regulations of the American Arbitration Association. In
such arbitration, the prevailing party shall be entitled, in addition to any
award made in such proceeding,

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to recover all of its costs and expenses incurred in connection therewith, 
including, without limitation, attorneys' fees.


     18.   Governing Law. This Employment Agreement shall be governed and
construed in accordance with the internal laws of the State of Nevada. The terms
of this Employment Agreement are intended to supplement but not displace, the
parties respective rights under the Nevada Uniform Trade Secrets Act, Nev. Rev.
Stat. Ann. 600A010 et seq., as amended, and any similar laws adopted in Indiana,
Illinois, Mississippi or Louisiana.


     19.   Notices. All notices required or desired to be given under this 
Employment Agreement shall be in writing and shall be deemed to have been duly 
given (i) on the date of service if served personally on the party to whom 
notice is to be given, (ii) on the date of receipt by the party to whom notice 
is to be given if transmitted to such party by telefax, provided a copy is 
mailed as set forth below on the date of transmission, or (iii) on the third day
after mailing if mailed to the party to whom notice is to be given by registered
or certified mail, return receipt requested, postage prepaid to the following 
addressed or to such other address as may be provided from time to time by one 
party to the other:


           If to Employer:            Horseshoe Gaming, Inc.
                                      4024 South Industrial Road
                                      Las Vegas, NV 89103
                                      Attn: Jack B. Binion


           If to Employee:            
                                      ----------------------

                                      ----------------------

                                      ----------------------

     20.   Assignment. This Employment Agreement shall be binding upon and 
inure to the benefit of the parties hereto and their respective heirs, 
successors, administrators and assigns. Notwithstanding the foregoing, Employee 
understands and agrees that the nature of this Employment Agreement is a 
personal services agreement, and that Employer is entering into this Employment 
Agreement based upon the specific services to be rendered personally by Employee
hereunder; and accordingly, Employee shall not assign, transfer or delegate in 
any manner any of his duties, responsibilities or obligations hereunder.


     21.   No Third Party Beneficiaries. This Employment Agreement is solely for
the benefit of Employer, the LLC, its subsidiaries and affiliates, and Employee,
and in no event shall any other person or entity by deemed or construed as a 
third party beneficiary of any of the provisions or conditions set forth herein.


     22.    Waiver. No waiver of any term, condition or covenant of this 
Employment Agreement by a party shall be deemed to be a waiver of any subsequent
breaches of the same or other terms, covenants or conditions hereof by such 
party.


     23.    Construction. Whenever possible, each provision of this Employment 
Agreement shall be interpreted in such manner as to be effective or valid under 
applicable law, but if any provision of 


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<PAGE>

this Employment Agreement shall be prohibited by or invalid under applicable
law, such provision shall be ineffective only to the extent of such prohibition
or invalidity without invalidating the remainder of such provision or the
remaining provisions of this Employment Agreement. Without limiting the
generality of the foregoing, if any court determines that the term or the
business or geographic scope of the covenants contained in Subsections 11(A) or
11(B) is impermissible due to the extent thereof, said covenant shall be
modified to reduce its term and/or business or geographic scope, as the case may
be, to the extent necessary to make such covenant valid, and said covenant shall
be enforced as modified.

     24. Withholding. Employer shall withhold from any payments due to Employee
hereunder, all taxes, FICA or other amounts required to be withheld pursuant to
any applicable law.

     25. Injunctive Relief. Employee and Employer each acknowledge that the
provisions of Sections 11 and 12 are reasonable and necessary, that the damages
that would be suffered as a result of a breach of threatened breach by Employee
of Sections 11 and/or 12 may not be calculable, and that the award of a money
judgment to Employer for such a breach or threatened breach thereof by Employee
would be an inadequate remedy. Consequently, Employee agrees that in addition to
any other remedy to which Employer may be entitled in law or in equity, the
provisions of Sections 11 and 12 may be enforced by Employer by injunctive or
other equitable relief, including a temporary and/or permanent injunction
(without proving a breach therefor), and Employer shall not be obligated to post
bond or other security in seeking such relief. Employee consents to the
jurisdiction of any state or federal court located in the State of Nevada,
Mississippi, Indiana or Illinois and hereby waives any and all objections to
venue.

     26. Counterparts. This Employment Agreement may be executed in any number
of counterparts, each of which shall be deemed an original but all of which
together shall constitute a single instrument.

                 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]




                                     -12-

<PAGE>
 
     IN WITNESS WHEREOF, the undersigned have executed this Employment Agreement
as of the date and year first above written.


                                  HORSESHOE GAMING, INC.
                                  A Nevada Corporation




                                  By:/s/ Jack B. Binion 
                                     -------------------------------------------
                                     Jack B. Binion, Chief Executive Officer


"EMPLOYEE"                           /s/ Peter A. Ferro, Jr.
                                     -------------------------------------------
                                     Peter A. Ferro, Jr.

                                     -13-
<PAGE>

                                   EXHIBIT A

                                  DEFINITIONS

     All capitalized terms referenced or used in this Employment Agreement and
not specifically defined therein shall have the meaning set forth below in this
Exhibit A, which is attached to and made a part of this Employment Agreement for
all purposes.

     Acquisition Date. The term "Acquisition Date" shall mean the date of
closing of the merger transactions as contemplated by that certain Agreement and
Plan of Merger by and among Horseshoe Gaming, L.L.C., Horseshoe Gaming
(Midwest), Inc., Empress Acquisition Illinois, Inc., Empress Acquisition
Indiana, Inc., Empress Casino Joliet Corporation, Empress Casino Hammond
Corporation and Empress Entertainment, Inc., dated as of September 2, 1998.

     Gaming Authority. The term "Gaming Authority" and "Gaming Authorities"
shall mean all agencies, authorities and instrumentalities of any state, nation
(including Native American nations) or other governmental entity or any
subdivision thereof, regulating gaming or related activities in the United
States or any state or political subdivision thereof, including, without
limitation, the Mississippi and Louisiana Gaming Commissions.

     Governmental Authority. The term "Governmental Authority" and "Governmental
Authorities" means the governments of (i) the United States of America, (ii) the
State of Mississippi, (iii) Tunica County, (iv) the State of Louisiana, (v)
Bossier City, Louisiana and (vi) any other political subdivision of any state of
the United States in which a casino Facility is located, and any court or
political subdivision, agency, commission, board or instrumentality or officer
thereof, whether federal, state or local, having or exercising jurisdiction over
Employer or a Facility, and including, without limitation, any Gaming Authority.

                                     -14-