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                                                                    EXHIBIT 10.1

                    FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
                    ---------------------------------------

     THIS FIRST AMENDMENT TO EMPLOYMENT AGREEMENT (the "First Amendment") is
made and entered into to be effective as of the 1/st/ day of May, 2001 between
HOLLYWOOD CASINO-AURORA, INC., an Illinois corporation (the "Employer"), and
GEORGE PATT MEDCHILL (the "Employee") with reference to the foregoing.

                                    RECITALS
                                    --------

     A.   Employer and Employee entered into that certain Employment Agreement
dated as of July 1, 1999 (the "Existing Employment Agreement"); and

     B.   Employer and Employee now desire to amend the Existing Employment
Agreement as provided below.

                                   AGREEMENTS
                                   ----------

          NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

1.   Paragraph 6 of the Existing Employment Agreement is hereby amended by
deleting the reference therein to "July 1, 2002" and replacing it with a
reference to "July 1, 2003."

2.   Paragraph 4 of the Existing Employment Agreement is hereby amended and
restated to read in its entirety as follows:

          "4.   DUTIES OF EMPLOYEE.  Employee shall perform such duties assigned
                ------------------
          to Employee by Hollywood Casino Corporation, a Delaware corporation
          and the parent of Employer ("HCC"), as are generally associated with
          the duties of Executive Vice President-Operations of HCC, including
          but not limited to (i) the efficient and continuous operation of the
          operating units of its Affiliates; (ii) the preparation of relevant
          budgets and allocation of relevant funds; (iii) the selection and
          delegation of duties and responsibilities of subordinates; (iv) the
          direction, review and oversight of all operations and programs under
          Employee's supervision; and (v) such other and further duties
          specifically related to such duties as assigned by HCC to Employee.
          The foregoing notwithstanding, Employee shall devote such time to
          HCC's Affiliates as required by HCC, provided such duties are not
          inconsistent with Employee's primary duties to Employer and HCC
          hereunder."

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3.   Paragraph 8(a) of the Existing Employment Agreement is hereby amended and
restated to read in its entirety as follows:

          "(a)   Base Salary.  Employer hereby covenants and agrees to pay to
                 -----------
          Employee, and Employee hereby covenants and agrees to accept from
          Employer, a base salary of (i) Two Hundred Eight-Five Thousand and
          No/100 Dollars ($285,000) per annum through April 30, 2001 and (ii)
          Three Hundred Thirty Thousand and No/100 Dollars ($330,000) per annum
          through the remainder of the Term.  Such base salary shall be payable
          in such equal regular installments as is Employer's custom and usage.
          Such base salary shall be exclusive of and in addition to any other
          benefits which Employer, in its sole discretion, may make available to
          Employee, including, but not limited to, any pension plans, bonus
          plans, retirements plans, company life insurance plans or medical
          and/or hospitalization plans."

4.   Paragraph 8(c) of the Existing Employment Agreement is hereby amended by
adding at the end thereof a new sentence which shall read in its entirety as
follows:

          "The aforementioned incentive compensation plan shall provide for a
          separate "target bonus" for Employee attributable to the operating
          results of each of the Hollywood Casino in Aurora and the Hollywood
          Casino in Shreveport.  Notwithstanding the foregoing, the bonus to be
          paid to Employee pursuant to such incentive compensation plan
          attributable to the operating results of the Hollywood Casino in
          Shreveport shall be no less than Twenty-Five Thousand and No/100
          Dollars ($25,000) for the calendar year 2001."

5.   Paragraph 9 of the Existing Employment Agreement is hereby amended and
restated to read in its entirety as follows:

     "9.   LICENSING REQUIREMENTS.
           ----------------------

          (a)      Employer and Employee hereby covenant and agree that this
          Agreement may be subject to the approval of the Illinois Gaming Board,
          the Mississippi Gaming Commission, the Louisiana Gaming Control Board
          and any other jurisdiction in which Employer or Employer's Affiliates
          conducts business (collectively, the "Gaming Authorities") pursuant to
          the provisions of the Illinois Riverboat Gambling Act, the Mississippi
          Gaming Control Act, the Louisiana Riverboat Economic Development and
          Gaming Control Act and any other applicable law and the regulations
          promulgated thereunder (collectively, the "Gaming Acts"). In the event
          this Agreement is required to be approved by any of the Gaming
          Authorities and is not so approved by the Gaming Authorities, this
          Agreement shall immediately terminate and be null and void and of no
          further force or effect; provided, however, should this Agreement not
          be approved by the Gaming Authorities, Employer and Employee shall
          hereby covenant and agree that, with the exception of the provisions

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          of Paragraph 8 of this Agreement, this Agreement shall be deemed
          modified and amended so as to receive the appropriate approval from
          the Gaming Authorities.

          (b)      Employer and Employee hereby covenant and agree that, in
          order for Employee to discharge the duties required under this
          Agreement, Employee may be required to continue to hold casino key
          employee licenses (the "Licenses") as issued by one or more Gaming
          Authorities pursuant to the terms of the Gaming Acts and as otherwise
          required by this Agreement. In the event that any of the Gaming
          Authorities objects to the renewal of Employee's License, or any of
          the Gaming Authorities refuses to renew Employee's applicable License,
          Employer, at Employer's sole cost and expense, shall promptly defend
          such action and shall take such reasonable steps as may be required to
          attempt to secure such Gaming Authority's approval. The foregoing
          notwithstanding, if such Gaming Authority's refusal to renew
          Employee's License arises as a result of any of the events described
          in Paragraph 1(a) of this Agreement, Employer's obligations under this
          Paragraph 9 shall not be operative and Employee shall promptly
          reimburse Employer upon demand for any expenses incurred by Employer
          pursuant to this Paragraph 9. "

6.   A new Paragraph 23 is hereby added to the Existing Employment Agreement,
which Paragraph 23 shall to read in its entirety as follows:

     "23.   TERMINATION BY EMPLOYEE.  Notwithstanding anything to the contrary
     contained in this Agreement, in the event that Employee shall be instructed
     to report to any individual other than Edward T. Pratt III, Employee may,
     on or prior to the date thirty (30) days from notice of such instruction,
     terminate this Agreement by providing thirty (30) days prior written notice
     to Employer.  Notwithstanding the termination of this Agreement by the
     Employee in accordance with this Paragraph 23, Employer shall continue to
     pay Employee's base salary set forth in Paragraph 8(a) through the date
     upon which this Agreement would have expired but for termination by the
     Employee."

7.   This First Amendment may be executed in multiple counterparts, each of
which shall be deemed an original but all of which together shall constitute one
and the same instrument.

8.   If any provision of this First Amendment or the application hereof to any
person or circumstances shall to any extent be held void, unenforceable or
invalid, then the remainder of this First Amendment or the application of such
provision to persons or circumstances other than those as to which it is held
void, unenforceable or invalid shall not be affected thereby, and each provision
of this First Amendment shall be valid and enforced to the fullest extent
permitted by law.

9.     THIS FIRST AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY THE LAWS OF THE STATE OF ILLINOIS, WITHOUT REGARD
TO ANY OF SUCH STATE'S DOCTRINES REGARD CONFLICTS OF LAWS.

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10.  Except as amended hereby, the Existing Employment Agreement shall continue
in full force and effect without any further action by the parties thereto.  On
or after the effective date of this First Amendment, references to the
"Agreement" in the Existing Employment Agreement, as amended hereby, shall be
deemed to mean, for purposes of determining the rights, remedies, obligations
and liabilities of the parties thereto and all other purposes, the Existing
Employment Agreement, as amended by this First Amendment.

                               *       *       *

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     IN WITNESS WHEREOF, the parties to this First Amendment have executed such
First Amendment effective as of the date first set forth above.

                              HOLLYWOOD CASINO-AURORA, INC.

                              By:   /s/ Edward T. Pratt III
                                    ----------------------------------------
                                    Name: Edward T. Pratt III
                                    Title:   President

                              /s/ George Patt Medchill
                              -----------------------------------------
                              George Patt Medchill

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                                                                    EXHIBIT 10.1

                                     CHARTER
            AUDIT AND COMPLIANCE COMMITTEE OF THE BOARD OF DIRECTORS
                            KINDRED HEALTHCARE, INC.

Mission Statement

The Committee is appointed to assist the Board of Directors in monitoring (i)
the adequacy of the Company's system of internal controls, accounting policies,
financial reporting practices, and the quality and integrity of the Company's
financial reporting; and (ii) the Company's compliance with applicable laws,
regulations, and policies.

Organization

The Audit and Compliance Committee of the Board of Directors shall be comprised
of at least three directors who are independent of the management and the
Company and free of any relationship that would interfere with their exercise of
independent judgment. All Audit and Compliance Committee members will be
competent in understanding financial statements, and at least one member will
have accounting or related financial management expertise. The Committee shall
meet at least four times annually and shall report to the Board of Directors on
its findings and matters within the scope of its responsibility. The Committee
shall maintain minutes of all its meetings to document its activities and
recommendations. The Committee shall obtain the full Board of Directors'
approval of this Charter and review and reassess this Charter as conditions
dictate (at least annually) and recommend changes it considers appropriate to
the Board.

Roles And Responsibilities

Engagement and Relationships with Auditors
------------------------------------------

 .    Review and then, recommend to the directors engagement of the independent
     auditors to be selected to audit the financial statements of the Company
     and its subsidiaries.

 .    Communicate to the independent auditors that they are ultimately
     accountable to the Board of Directors and the Audit and Compliance
     Committee, as the shareholders' representatives, who have the ultimate
     authority in deciding to engage, evaluate, and if appropriate, terminate
     their services.

 .    Meet with the independent auditors and financial management of the Company
     to review the scope of the proposed audit and timely quarterly reviews for
     the current year and the procedures to be utilized, review such audit or
     review, including any comments or recommendations of the independent
     auditors, and review the independent auditors' compensation.

 .    Review with the independent auditors, the Company's internal auditor, and
     financial and accounting personnel, the adequacy and effectiveness of the
     accounting and financial controls of the Company, and elicit any
     recommendations for the improvement of such internal control procedures or
     particular areas where new or more detailed controls or procedures are

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     desirable. The Committee should review whether recommendations made have
     been implemented by management.

 .    Inquire of management, the internal auditor, and the independent auditors
     about significant financial risks or exposures and assess the steps
     management has taken to control such risks or exposure.

 .    Review and, concur with or reject, management's appointment, termination,
     or replacement of the Director of Internal Audit.

 .    Review the internal audit function of the Company including the
     independence and authority of the internal audit function's reporting
     obligations, the proposed internal audit plans for the coming year, and the
     coordination of such plans with the independent auditors.

 .    Review the significant reports from completed internal audits as well as
     management's responses.

 .    Receive prior to each meeting, a progress report on the proposed internal
     audit plan, with explanations for any deviations from the original plan.

Financial Reporting
-------------------

 .    Review the quarterly financial statements with financial management and the
     independent auditors prior to the filing of the Form 10-Q (or prior to the
     press release of results, if possible) to determine that the independent
     auditors do not take exception to the disclosure and content of the
     financial statements, and discuss any other matters required to be
     communicated to the Committee by the auditors. The chair and another member
     of the Committee may represent the entire Committee for purposes of this
     review.

 .    Review the financial statements contained in the annual report to
     shareholders with management and the independent auditors to determine that
     the independent auditors are satisfied with the disclosure and content of
     the financial statements to be presented to the shareholders. Any changes
     in accounting principles should be reviewed.

 .    Discuss with financial management and the independent auditors the quality
     of the accounting principles and judgments used in preparing the financial
     statements.

 .    Discuss with the independent auditors the matters required to be discussed
     by Statement of Auditing Standards No. 61, as amended from time to time,
     relating to the conduct of the audit.

 .    Obtain from the independent auditors their report on compliance with
     Section 10A of the Securities Act of 1933, as amended.

 .    Review with the Company's General Counsel legal matters that may have a
     material impact on the Company's financial statements, compliance issues,
     and any material inquiries or reports from regulators or governmental
     agencies.

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 .    Review with financial management and the independent auditors the results
     of their timely analysis of significant financial reporting issues and
     practices, including changes in, or new adoptions of, accounting principles
     and disclosure practices and discuss any other matters required to be
     communicated to the Committee by the auditors.

 .    Provide sufficient opportunity for the internal and independent auditors to
     meet with the members of the Audit and Compliance Committee without members
     of management present. Among the items to be discussed in these meetings
     are the independent auditors' evaluation of the Company's financial,
     accounting, and auditing personnel, and the cooperation that the
     independent and internal auditors received during the course of their
     audits.

 .    On an annual basis, obtain from the independent auditors a written
     communication delineating all their relationships and professional services
     as required by Independence Standards Board Standard No. 1, Independence
     Discussions with Audit Committees. In addition, review with the independent
     auditors the nature and scope of any disclosed relationships or
     professional services and take, or recommend that the Board of Directors
     take, appropriate action to ensure the continuing independence of the
     auditors.

 .    Prepare a report of the Audit and Compliance Committee as required to be
     included in the Company's proxy statement.

 .    Report the results of the annual audit to the Board of Directors. If the
     Committee considers it advisable or if requested by the Board of Directors,
     invite the independent auditors to attend the full Board of Directors
     meeting to assist in reporting the results of the annual audit or to answer
     other directors' questions (alternatively, the other directors,
     particularly the other independent directors, may be invited to attend the
     Audit and Compliance Committee meeting during which the results of the
     annual audit are reviewed).

 .    Include a copy of this Charter in the annual report to shareholders or the
     proxy statement at least triennially or the year after any significant
     amendment to the Charter.

Corporate Compliance
--------------------

 .    Review and, concur with or reject, management's appointment, termination,
     or replacement of the Corporate Compliance Officer.

 .    Review the adequacy of the Company's system of internal controls,
     accounting policies, financial reporting practices, and the quality and
     integrity of financial reporting to Federal health care programs.

 .    Ensure that the Company adopts and implements policies and procedures
     designed to ensure compliance with all applicable statutes, regulations,
     policies and the Corporate Integrity Agreement.

 .    Ensure that the Company has a system in place to respond to Federal, state,
     internal, and external reports of quality of care issues and that such
     system functions adequately.

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 .    Ensure that the Company adopts and implements policies and procedures that
     are designed to ensure that each individual cared for in the Company's
     facilities receives the level of care required by law.

 .    Be available to the Compliance Officer, the External Monitors and the
     Independent Review Organization to respond to any issues or questions that
     might arise under the Corporate Integrity Agreement.

 .    Review with the Compliance Officer the steps the Company is taking to
     educate its employees regarding its Standards of Conduct and compliance
     issues.

 .    Review with the Compliance Officer the types of issues reported to the
     Company through its compliance hotline and the results of any internal
     investigations initiated by the Company in response to compliance issues
     reported through the hotline or otherwise brought to the Company's
     attention.

 .    Investigate, or ask the General Counsel to investigate, any matter brought
     to the attention of the Committee within the scope of its duties, and
     obtain legal advice for this purpose, if, in its judgment, that is
     appropriate.

Reporting Responsibilities
--------------------------

 .    Submit the minutes of all meetings of the Audit and Compliance Committee
     to, or discuss the matters discussed at each committee meeting with, the
     Board of Directors.

               Approved by the Audit and Compliance Committee and the Board of
               Directors on September 25, 2001.

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