Caesars Entertainment
Annual Report 2016

Plain-text annual report

CAESARS ENTERTAINMENT CORP FORM 10-K (Annual Report) Filed 02/15/17 for the Period Ending 12/31/16 Address ONE CAESARS PALACE DRIVE LAS VEGAS, NV 89109 7024076000 0000858339 Telephone CIK Symbol CZR SIC Code 7011 - Hotels and Motels Industry Casinos & Gaming Sector Consumer Cyclicals Fiscal Year 12/31 http://www.edgar-online.com © Copyright 2017, EDGAR Online, Inc. All Rights Reserved. Distribution and use of this document restricted under EDGAR Online, Inc. Terms of Use. SECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549 FORM 10-K (Mark One)xANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934FOR THE FISCAL YEAR ENDED December 31, 2016OR oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934Commission File No. 1-10410 CAESARS ENTERTAINMENT CORPORATION(Exact name of registrant as specified in its charter) Delaware 62-1411755(State of incorporation) (I.R.S. Employer Identification No.) One Caesars Palace Drive, Las Vegas, Nevada 89109(Address of principal executive offices) (Zip code)Registrant’s telephone number, including area code:(702) 407-6000SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:Title of each class Name of each exchange on which registered Common stock, $0.01 par value NASDAQ Global Select MarketSECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:NoneIndicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No xIndicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No xIndicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during thepreceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for thepast 90 days. Yes x No oIndicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to besubmitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that theregistrant was required to submit and post such files). Yes x No oIndicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best ofregistrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.oIndicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. Seedefinitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):Large accelerated filer oAccelerated filer xNon-accelerated filer oSmaller reporting company o (Do not check if a smallerreporting company) Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No xThe aggregate market value of common stock held by non-affiliates of the registrant as of June 30, 2016 was $444 million .As of February 1, 2017 , the registrant had 147,184,937 shares of Common Stock outstanding.DOCUMENTS INCORPORATED BY REFERENCEPortions of the Registrant’s definitive proxy statement for the Proxy Statement for our 2017 Annual Meeting of Stockholders, which we expect to file with theSecurities and Exchange Commission on or about April 5, 2017 , are incorporated by reference into Part III.CAESARS ENTERTAINMENT CORPORATIONINDEX TO CONSOLIDATED FINANCIAL STATEMENTS PagePart I Item 1 – Business1 Item 1A – Risk Factors7 Item 1B – Unresolved Staff Comments29 Item 2 – Properties30 Item 3 – Legal Proceedings31 Item 4 – Mine Safety Disclosures31Part II Item 5 – Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities32 Item 6 – Selected Financial Data34 Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations35 Item 7A – Quantitative and Qualitative Disclosures About Market Risk53 Item 8 – Financial Statements and Supplementary Data54 Report of Independent Registered Public Accounting Firm54 Consolidated Financial Statements55 Notes to Consolidated Financial Statements59 Item 9 – Changes in and Disagreements with Accountants on Accounting and Financial Disclosure112 Item 9A – Controls and Procedures112 Item 9B – Other Information114Part III Item 10 – Directors, Executive Officers and Corporate Governance115 Item 11 – Executive Compensation115 Item 12 – Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters115 Item 13 – Certain Relationships and Related Transactions, and Director Independence115 Item 14 – Principal Accounting Fees and Services115Part IV Item 15 – Exhibits, Financial Statement Schedules116 Signatures141PART IIn this filing, the name “CEC” refers to the parent holding company, Caesars Entertainment Corporation, exclusive of its consolidated subsidiaries and variableinterest entities, unless otherwise stated or the context otherwise requires. The words “Company,” “Caesars,” “Caesars Entertainment,” “we,” “our,” and “us”refer to Caesars Entertainment Corporation, inclusive of its consolidated subsidiaries and variable interest entities, unless otherwise stated or the contextotherwise requires.We also refer to (i) our Consolidated Financial Statements as our “Financial Statements,” (ii) our Consolidated Statements of Operations and ComprehensiveIncome as our “Statements of Operations,” and (iii) our Consolidated Balance Sheets as our “Balance Sheets.” References to numbered “Notes” refer to Notes toour Consolidated Financial Statements included in Item 8.ITEM 1.BusinessOverviewCaesars Entertainment is a casino-entertainment and hospitality services provider. CEC is primarily a holding company with no independent operations of its own.It owns Caesars Entertainment Resort Properties, LLC (“CERP”) and an interest in Caesars Growth Partners, LLC (“CGP”). CEC also holds a majority interest inCaesars Entertainment Operating Company, Inc. (“CEOC”); however, as described in Note 2 , the results of CEOC and its subsidiaries are no longer consolidatedwith Caesars subsequent to CEOC and certain of its United States subsidiaries (the “Debtors”) voluntarily filing for reorganization under Chapter 11 of the UnitedStates Bankruptcy Code (the “Bankruptcy Code”) on January 15, 2015 .The Caesars portfolio of properties, including the properties owned and operated by CEOC, represents the world’s most diversified casino-entertainment portfoliowith entertainment facilities in more areas throughout the United States than any other participant in the gaming industry. We have established a rich history ofindustry-leading growth and expansion since we commenced operations in 1937. Our facilities typically include gaming offerings, food and beverage outlets, hoteland convention space, and non-gaming entertainment options. In addition to our brick and mortar assets, we operate an online gaming business that provides realmoney games in certain jurisdictions.Announced Merger and CEOC Plan of ReorganizationIn 2014, CEC and Caesars Acquisition Company (“CAC”) entered into a merger agreement, which was amended and restated on July 9, 2016 (the “MergerAgreement”). Pursuant to the Merger Agreement, among other things, CAC will merge with and into CEC, with CEC as the surviving company (the “Merger”).See Note 1 .On January 13, 2017 , the Debtors filed an amended plan of reorganization (the “Third Amended Plan”) with the United States Bankruptcy Court for the NorthernDistrict of Illinois in Chicago (the “Bankruptcy Court”) that replaces all previously filed plans. CEC, CAC, the Debtors, and CEOC’s major creditor groups haveagreed to support the Third Amended Plan. The Bankruptcy Court confirmed the Third Amended Plan on January 17, 2017. Although the Third Amended Plan hasbeen confirmed by the Bankruptcy Court, we must still obtain regulatory approval in all of the jurisdictions in which we have gaming operations in order forCEOC to successfully emerge from bankruptcy, and we are unable to determine when all necessary requirements will be satisfied. In addition, the Third AmendedPlan remains subject to completion of the Merger, certain financing transactions, and various other closing conditions. See Note 1 .1Organizational StructureThe following diagram illustrates the key entities and subsidiaries in the Caesars Entertainment current organizational structure. This diagram does not include alllegal entities and subsidiaries. ___________________________(1) CEOC filed for bankruptcy protection under Chapter 11 of the US Bankruptcy Code on January 15, 2015 and was no longer consolidated within CEC as a result. See Note 2 .(2) CAC is party to the series of transactions that formed CGP and owns 100% of the voting membership units in CGP. Caesars owns 100% of the non-voting membership units in CGP andconsolidates CGP as a variable interest entity. See Note 2 . See information about Caesars’ announced merger with CAC in Note 1 .(3) Ownership held by Caesars Growth Properties Holding, LLC (“CGPH”), a subsidiary of CGP.(4) Caesars Enterprise Services, LLC (“CES”) is a services joint venture formed by CEOC, CERP, and CGPH (collectively, the “Members”). See Note 1 .(5) Our reportable segments currently include CERP and CGP. See Note 1 . CEOC remained a reportable segment until its deconsolidation effective January 15, 2015. See Note 2 .As of December 31, 2016 , through our consolidated entities, we owned 12 casinos in the United States, with over one million square feet of gaming space andapproximately 24,000 hotel rooms. Our properties are concentrated in Las Vegas, where eight of the twelve are located. See Item 2 for more information about ourproperties.CERP owns six casinos in the United States and The LINQ promenade along with leasing Octavius Tower at Caesars Palace Las Vegas (“Octavius Tower”) toCEOC and gaming space at The LINQ promenade to CGP.CGP owns six casinos in the United States and, through its subsidiary Caesars Interactive Entertainment, Inc. (“CIE”), owns and operates a regulated online realmoney gaming business and the World Series of Poker (“WSOP”) tournaments and brand. As discussed in Note 17 , on September 23, 2016 , CIE sold its socialand mobile games business (“SMG Business”) for approximately $4.4 billion in cash.CES provides certain corporate and administrative services for the Members’ casino properties, including substantially all of the casino properties owned by CEOCand casinos owned by unrelated third parties. CES also manages certain enterprise assets and the other assets it owns, licenses or controls, and employs certain ofthe corresponding employees. See Note 1 .2Business OperationsOur consolidated business is composed of four complementary businesses that reinforce, cross-promote, and build upon each other: casino entertainment, food andbeverage, rooms and hotel, and entertainment and other business operations.Casino Entertainment OperationsOur casino entertainment operations include revenues from approximately 15,000 slot machines and 1,200 table games, as well as other games such as keno, poker,and race and sports books, all of which comprised approximately 49% of our total net revenues in 2016 . Slot revenues generate the majority of our gamingrevenue and are a key driver of revenue, particularly in our properties located outside of the Las Vegas market. We are testing a number of skill-based games as weimplement product offerings intended to appeal to all demographics, and expect to expand these offerings as required regulatory approvals are obtained.Food and Beverage OperationsOur food and beverage operations generate revenues primarily from over 50 buffets, restaurants, bars, nightclubs, and lounges located throughout our casinos, aswell as banquets and room service, and represented approximately 18% of our total net revenues in 2016 . Many of our properties include several dining options,ranging from upscale dining experiences to moderately-priced restaurants and buffets.Rooms and Hotel OperationsRooms and hotel operations revenue comprised approximately 21% of our total net revenues in 2016 and is primarily generated from hotel stays at our casinoproperties and our approximately 24,000 guest rooms and suites.Our properties operate at various price and service points, allowing us to host a variety of casino guests who are visiting our properties for gaming and other casinoentertainment options and non-casino guests who are visiting our properties for other purposes, such as vacation travel or conventions.We have engaged in large capital reinvestment projects in recent years focusing primarily on room product across the United States. In the Las Vegas market,nearly 6,000 rooms have been renovated since 2014, across properties such as The LINQ Hotel & Casino, Planet Hollywood Resort & Casino, Paris Las Vegas,and Harrah’s Las Vegas. In addition, we plan to continue the roll out of self-check-in kiosks in Las Vegas in order to help reduce customer wait times and improvelabor efficiencies.Entertainment and Other Business OperationsWe provide a variety of retail and entertainment offerings in our casinos and The LINQ promenade. We operate several entertainment venues across the UnitedStates, including The AXIS at Planet Hollywood, which was ranked as one of the top theater venues in the United States in 2016 based on ticket sales. This awardwinning theater hosts several prominent headliners, such as Jennifer Lopez, Lionel Richie, and Britney Spears. We recently announced that the Backstreet Boyswill have performances starting in early 2017.The LINQ promenade and our retail stores offer guests a wide range of options from high-end brands and accessories to souvenirs and decorative items. The LINQpromenade is an open-air dining, entertainment, and retail development located between The LINQ Hotel and the Flamingo Las Vegas, and also features The HighRoller, our 550-foot observation wheel at The LINQ promenade.In addition, CIE operates a regulated online real money gaming business in Nevada and New Jersey and owns the WSOP tournaments and brand, and also licensesWSOP trademarks for a variety of products and businesses related to this brand.Sales and MarketingWe believe the Caesars portfolio of properties (including the CEOC properties) that operate under the Total Rewards program enable us to capture a larger share ofour customers’ entertainment spending when they travel among markets versus that of a standalone property, which is core to our cross-market strategy. Webelieve that our high concentration of properties in the center of the Las Vegas Strip generates increased revenues and enables us to capture more of our customers’gaming dollars than would be generated if the properties were operated separately.We believe the Total Rewards program, in conjunction with this distribution system, allows us to capture a growing share of our customers’ entertainmentspending and compete more effectively. Members earn Reward Credits at all Caesars-affiliated properties in the United States and Canada for on-propertyentertainment expenses, including gaming, hotel, dining, and retail shopping. Members may also earn Reward Credits through the Total Rewards Visa credit cardand can redeem Reward Credits with our many partners, including Atlantis Paradise Island Resort and Norwegian Cruise Line. Total Rewards members canredeem Reward Credits3for amenities or other items such as merchandise, gift cards, and travel. Total Rewards is structured in tiers (designated as Gold, Platinum, Diamond or SevenStars), each with increasing member benefits and privileges.Members are also provided promotional offers and rewards based on their engagement with Caesars-affiliated properties, aspects of their casino gaming play, andtheir preferred spending choices outside of gaming. Member information is also used for marketing promotions, including direct mail campaigns, electronic mail,our website, mobile devices, social media, and interactive slot machines.Intellectual PropertyThe development of intellectual property is part of our overall business strategy. We regard our intellectual property to be an important element of our success.While our business as a whole is not substantially dependent on any one patent, trademark, copyright or combination of several of our intellectual property rights,we seek to establish and maintain our proprietary rights in our business operations and technology through the use of patents, trademarks, copyrights, and tradesecret laws. We file applications for and obtain patents, trademarks, and copyrights in the United States and foreign countries where we believe filing for suchprotection is appropriate, including United States and foreign patent applications covering certain proprietary technology of CEOC. We also seek to maintain ourtrade secrets and confidential information by nondisclosure policies and through the use of appropriate confidentiality agreements. CEOC’s United States patentshave varying expiration dates, the last of which is 2031.We have not applied for the registration of all of our trademarks, copyrights, proprietary technology or other intellectual property rights, as the case may be, andmay not be successful in obtaining all intellectual property rights for which we have applied. Despite our efforts to protect our proprietary rights, parties mayinfringe upon our intellectual property and use information that we regard as proprietary, and our rights may be invalidated or unenforceable. The laws of someforeign countries do not protect proprietary rights or intellectual property to as great an extent as do the laws of the United States. In addition, others mayindependently develop substantially equivalent intellectual property.We own or have the right to use proprietary rights to a number of trademarks that we consider, along with the associated name recognition, to be valuable to ourbusiness, including the following:•CEOC’s marks include Caesars, Harrah’s, Horseshoe, Bally’s, and Total Rewards;•CERP’s marks include Rio, Flamingo, and Paris;•CIE’s marks include WSOP; and•CGP holds a license for the Planet Hollywood mark used in connection with the Planet Hollywood Resort & Casino in Las Vegas.Omnibus License and Enterprise Services AgreementThe Members of CES entered into an Omnibus License and Enterprise Services Agreement (the “Omnibus Agreement”) in 2014, which granted various licenses tothe Members through CES and allowed the Members to continue to use the intellectual property each of the properties owned or managed by the Members used intheir associated businesses, including Total Rewards. See Note 1 for a complete discussion of CES and the Omnibus Agreement. Under the terms of the CES jointventure and the Omnibus License and Enterprise Services Agreement, we believe that Caesars and its other operating subsidiaries will continue to have access tothe services historically provided to us by CEOC and its employees, trademarks, and programs despite the CEOC bankruptcy filing.CompetitionCasinosThe casino entertainment business is highly competitive. The industry is comprised of a diverse group of competitors that vary considerably in size and geographicdiversity, quality of facilities and amenities available, marketing and growth strategies, and financial condition. In most markets, we compete directly with othercasino facilities operating in the immediate and surrounding areas. Our Las Vegas Strip hotels and casinos also compete, in part, with each other. We also competewith other non-gaming resorts and vacation areas, various other entertainment businesses, and other forms of gaming, such as state lotteries, on-and off-trackwagering, video lottery terminals, and card parlors. Our non-gaming offerings also compete with other retail facilities, amusement attractions, food and beverageofferings, and entertainment venues.In recent years, many casino operators, including us, have been reinvesting in existing facilities, developing new casino or complementary facilities, and acquiringestablished facilities. These reinvestment and expansion efforts combined with aggressive marketing strategies by us and many of our competitors have resulted inincreased competition in many markets.4The expansion of casino properties and entertainment venues into new markets also presents competitive issues for us that have had a negative impact on ourfinancial results. Atlantic City, in particular, has seen a decline of more than 50% compared with 2006 levels primarily due to the addition of gaming capacityassociated with the expansion of gaming in Maryland, New York, and Pennsylvania. This has resulted in several casino closings in recent years, including CEOC’sShowboat Atlantic City casino and four competitor casinos since 2014. More recently, our property in Baltimore has also experienced competitive pressure.See Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” See also Exhibit 99.1, “Gaming Overview,” to this Form10-K. In addition, for a summary of key developments in 2016, see “ Summary of 2016 Events and Key Drivers of Annual Performance ” in Item 7,“Management’s Discussion and Analysis of Financial Condition and Results of Operations.”Governmental RegulationThe gaming industry is highly regulated, and we must maintain our licenses and pay gaming taxes to continue our operations. Each of our casinos is subject toextensive regulation under the laws, rules, and regulations of the jurisdiction in which it is located. These laws, rules, and regulations generally concern theresponsibility, financial stability, and character of the owners, managers, and persons with financial interests in the gaming operations. Violations of laws in onejurisdiction could result in disciplinary action in other jurisdictions. A more detailed description of the regulations to which we are subject is contained inExhibit 99.1, “Gaming Overview,” to this Form 10-K.Our businesses are subject to various foreign, federal, state, and local laws and regulations, in addition to gaming regulations. These laws and regulations include,but are not limited to, restrictions and conditions concerning alcoholic beverages, smoking, environmental matters, employees, currency transactions, taxation,zoning and building codes, construction, land use, and marketing and advertising. We also deal with significant amounts of cash in our operations and are subjectto various reporting and anti-money laundering regulations. Such laws and regulations could change or could be interpreted differently in the future, or new lawsand regulations could be enacted. Material changes, new laws or regulations, or material differences in interpretations by courts or governmental authorities couldadversely affect our operating results. See Item 1A, “Risk Factors” for additional discussion.Employee RelationsWe have approximately 31,000 employees throughout our organization. Approximately 17,000 of our employees are covered by collective bargaining agreementswith certain of our subsidiaries, relating to certain casino, hotel, and restaurant employees. The majority of these employees are covered by the followingagreements:Employee Group Approximate Number ofActive Employees Represented Union Date on which Collective BargainingAgreement Becomes AmendableLas Vegas Culinary Employees 8,700 Culinary Workers Union, Local 226 Various up to July 31, 2018Atlantic City Food & Beverage and Hotelemployees 1,600 UNITE HERE, Local 54 February 28, 2020Las Vegas Bartenders 1,200 Bartenders Union, Local 165 Various up to July 31, 2018Las Vegas Dealers 1,800 Transport Workers Union of Americaand UAW Various up to September 30, 2019Corporate Citizenship, Social Responsibility and SustainabilityCaesars Entertainment’s Board of Directors and senior executives are committed to maintaining our position as an industry leader in corporate citizenship,corporate social responsibility, and sustainability. In 2016, we continued to engage with our CEO-level external environmental sustainability advisory board withexperts representing non-governmental organizations, business strategy, academia, and investors and used their advice to modify our citizenship priority focus for2016 and 2017. In 2016, we published our seventh annual Citizenship Report in accordance with Global Reporting Initiative G4 framework.Code of CommitmentFor more than 15 years, our Code of Commitment has guided our approach to responsible and ethical business, compliance and anti-corruption. Training eventsreinforce our expectations of all employees.5For the second year running, we were recognized on the Civic 50, an initiative organized by Points of Light and Bloomberg that recognizes companies for theircommitment to improving the quality of life in their home communities. Caesars was the first company to develop responsible gaming programs informed byscience, evaluated objectively and created in conjunction with leading researchers. In 2016, we confirmed our support for the UN Sustainable Development Goalsand identified eight goals where we can make the most significant contribution and expand our impact in coming years.Environmental StewardshipSince 2007, we have advanced a strategy to contribute to global climate change and sustainability initiatives that reduce our impact on the environment. Ourstructured, data-driven CodeGreen program leverages the passion of our employees and engages our guests and suppliers. Between 2007 and 2015, we reducedenergy consumption across our properties by 23.4% per air-conditioned sq. ft. and greenhouse gas emissions by 28.3%. Since 2008, we have reduced waterconsumption by 20.4%. In 2015, 38% of our total waste was recycled in addition to an overall 28% reduction in waste across our operations.In 2016, Caesars surpassed its Green Key certification goal of having 90% of owned or managed North American hotel resort properties achieve a 4 Key rating orhigher. Including the properties owned and operated by CEOC, thirty of our hotel resort properties are rated 4 Keys - more than any other casino-entertainmentcompany in the world. Recently recognized by the Global Sustainable Tourism Council, Green Key is a rigorous program that ranks, certifies, and inspects hotelsand resorts based on their commitment to sustainable operations. Green Key uses a rating system of 1 to 5 Keys, with 5 being the highest possible attainment.For our work in 2016, Caesars Entertainment received “A” scores for carbon (A) and water (A-) impact and supplier engagement (A-) from the formerly namedCarbon Disclosure Project (“CDP”), the international not-for-profit that drives sustainable economies. Thousands of companies submit annual climate disclosuresto CDP for independent assessment against its scoring methodology. Caesars is one of 193 "A Listers" on its carbon disclosure, which has been produced at therequest of 827 investors with assets of $100 trillion. Just 9% of the corporations participating in CDP’s climate change program are awarded a position on theClimate “A List.”Diversity, Inclusion, and Employee WellbeingWe create a dynamic and innovative working culture where individual growth is rewarded, recognized, and celebrated. Caesars is the only company in the casinoentertainment industry to receive perfect scores on the Human Rights Campaign Corporate Equality Index for ten consecutive years, including 2016. We encouragediversity and the advancement of women, and in 2015, 34% of our managers belonged to minority groups and 42% of our managers were women. We continue tofund more than $15 million each year to support our Employee Wellness Program, including 29 nurses and coaches across our properties. The program provesitself year after year with improved health metrics for participating employees, more than $2,500 annual saving per employee on healthcare and insurance savingsfor Caesars due to lower health risk.Community InvestmentEstablished in 2002, the Caesars Foundation (the “Foundation”) is a private charitable foundation funded by a portion of operating income from our resorts. Sinceits inception, the Foundation has gifted more than $72 million to support vibrant communities. In 2015, our total community investment (including CaesarsFoundation, corporate, mandated and discretionary giving, and the value of employee volunteering hours) amounted to $67.2 million. Employee volunteering in2015 reached 260,000 hours - our highest annual level of volunteering on record.Available InformationOur Internet address is www.caesars.com. We make available free of charge, on or through our website, our annual reports on Form 10-K, quarterly reports onForm 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of1934, as amended (the “Exchange Act”), as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities andExchange Commission (the “SEC”). We also make available through our website all filings of our executive officers and directors on Forms 3, 4, and 5 underSection 16 of the Exchange Act. These filings are also available on the SEC’s website at www.sec.gov. Our Code of Business Conduct and Ethics is available onour website under the “Investor Relations” link. We will provide a copy of these documents without charge to any person upon receipt of a written requestaddressed to Caesars Entertainment Corporation, Attn: Corporate Secretary, One Caesars Palace Drive, Las Vegas, Nevada 89109. Reference in this document toour website address does not constitute incorporation by reference of the information contained on the website.6ITEM 1A. Risk FactorsRisk Related to CEC’s Ability to Continue as a Going ConcernThere is a stay of the Noteholder Disputes in the Bankruptcy Court. If the stay were lifted and a court were to find in favor of the claimants in the NoteholderDisputes, it would likely have a material adverse effect on our business, financial condition, results of operations and cash flows and, absent an interveningevent, a reorganization under Chapter 11 of the Bankruptcy Code would likely be necessary due to the limited resources available at CEC to resolve suchmatters. If the Third Amended Plan was not consummated, it would raise substantial doubt about CEC’s ability to continue as a going concern.We are subject to a number of Noteholder Disputes, as described in Note 3 , all of which are currently stayed consensually or by order of the Bankruptcy Court,related to various transactions that CEOC has completed since 2010. Plaintiffs in certain of these actions raise allegations of breach of contract, intentional andconstructive fraudulent transfer, and breach of fiduciary duty, among other claims. Although the Delaware First Lien Lawsuit has been subject to a consensual staypursuant to the First Lien Bond RSA since CEOC’s filing for Chapter 11, and the Delaware Second Lien Lawsuit is not proceeding with respect to fraud or breachof fiduciary duty claims, should a court find in favor of the plaintiffs on such claims in any of the Noteholder Disputes, including the New York First Lien Lawsuit,the New York Second Lien Lawsuit or the Senior Unsecured Lawsuits, the transactions at issue in those lawsuits may be subject to rescission and/or the Companymay be required to pay damages to the plaintiffs. In the event of an adverse outcome on one or all of these matters, it is likely that a reorganization under Chapter11 of the Bankruptcy Code would be necessary due to the limited resources available at CEC to resolve such matters. See Note 3 .A number of the Noteholder Disputes also involve claims that CEC is liable for all amounts due and owing on certain notes issued by CEOC, based on allegationsthat provisions in the governing indentures pursuant to which CEC guaranteed CEOC’s obligations under those notes remain in effect (the “Guarantee Claims”).Such Guarantee Claims were most recently raised against Caesars Entertainment in a lawsuit filed on October 20, 2015 by Wilmington Trust, National Associationin the United States District Court for the Southern District of New York (the “SDNY Court”). Adverse rulings on the Guarantee Claims in this action or any of theother Noteholder Disputes could negatively affect our position on such Guarantee Claims in other Noteholder Disputes, or with respect to potential claims by otherholders of certain other notes issued by CEOC. If the court in any of these Noteholder Disputes were to find in favor of the plaintiffs on the Guarantee Claims,CEC may become obligated to pay all principal, interest, and other amounts due and owing on the notes at issue. If CEC became obligated to pay amounts owed onCEOC’s indebtedness as a result of the Guarantee Claims, it is likely that a reorganization under Chapter 11 of the Bankruptcy Code would be necessary due to thelimited resources available at CEC to resolve such matters.On October 4, 2016, the Debtors, along with CEC, entered into, or amended and restated, restructuring support agreements with the Debtors’ major creditorgroups. Under these agreements, the parties agreed to support the Third Amended Plan that will, if all conditions precedent to the effectiveness of the ThirdAmended Plan are satisfied or waived, result in a release of all claims against CEC relating to CEOC, including the claims in Parent Guarantee Lawsuits (asdefined in Note 3 ), and all claims asserted by or on behalf of the Debtors’ estate or their representative creditors.The Parent Guarantee Lawsuits are still enjoined, but in the event that the stay is lifted, the Third Amended Plan does not become effective, or the restructuringagreement with the official committee of second priority noteholders is terminated, and the Parent Guarantee Lawsuits proceed to judgment, given the inherentuncertainties of litigation, we have concluded that these matters raise substantial doubt about the Company’s ability to continue as a going concern. In the event ofan adverse outcome on such matters, CEC would likely seek reorganization under Chapter 11 of the Bankruptcy Code soon thereafter.If the Third Amended Plan is not consummated, we estimate that we would require additional sources of funding to meet our ongoing financial commitmentsprimarily resulting from significant expenditures made to defend the Company against the matters disclosed in Note 1 under “Litigation.” As a result of theforegoing, there is substantial doubt about CEC's ability to continue as a going concern. See Note 1 .7Risks Related to the Bankruptcy ProceedingsThe consummation of the Third Amended Plan is subject to a number of significant conditions.Although the Debtors believe that the effective date of the Third Amended Plan will occur in 2017, there can be no assurance as to such timing or that allconditions precedent will be satisfied. The consummation of the Third Amended Plan is subject to certain conditions precedent as described in the Third AmendedPlan, including, among others, the completion of the Merger (as defined below) and conditions relating to the exit financing facilities, the receipt or filing of allapplicable approvals or applications with applicable government entities, certain agreements with unions having been executed and ratified and regulations forfunding relief in respect of certain of CEOC’s pension plans will have been adopted to CEOC’s satisfaction.CEOC and a substantial majority of its wholly owned subsidiaries filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code, and we andthey are subject to the risks and uncertainties associated with bankruptcy proceedings.As a result of CEOC’s highly-leveraged capital structure and the general decline in its gaming results between 2007 and 2014, on January 15, 2015, CEOC and theDebtors voluntarily filed for reorganization under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court. Due to the commencement of the Chapter 11proceedings, the operations and affairs of the Debtors are subject to the supervision and jurisdiction of the Bankruptcy Court.We and CEOC are subject to a number of risks and uncertainties associated with the Chapter 11 proceedings, which may lead to potential adverse effects on ourliquidity, results of operations, or business prospects. We cannot assure you of the outcome of the Chapter 11 proceedings. Risks associated with the Chapter 11proceedings include the following:•the ability of the Debtors to continue as a going concern;•the ability of the Debtors to obtain Bankruptcy Court approval with respect to motions in the Chapter 11 proceedings and the outcomes of BankruptcyCourt rulings of the proceedings and appeals of such rulings in general;•the ability of the Debtors to comply with and to operate under the cash collateral order and any cash management orders entered by the Bankruptcy Courtfrom time to time;•the length of time the Debtors will operate under the Chapter 11 proceedings and their ability to successfully emerge, including with respect to obtainingany necessary regulatory approvals;•the ability of the Debtors to complete the Third Amended Plan and Caesars Entertainment’s role in such plan of reorganization;•the likelihood of Caesars Entertainment losing control over the operation of the Debtors as a result of the restructuring process;•risks associated with third party motions, proceedings and litigation in the Chapter 11 proceedings, which may interfere with the Third Amended Plan;•our and the Debtors’ ability to maintain sufficient liquidity throughout the Chapter 11 proceedings;•increased costs being incurred by Caesars Entertainment and the Debtors related to the bankruptcy proceeding, other litigation, and any appeals of anyrulings in such proceeding or other litigation;•our and the Debtors’ ability to manage contracts that are critical to our operation, and to obtain and maintain appropriate credit and other terms withcustomers, suppliers and service providers;•our and the Debtors’ ability to attract, retain and motivate key employees;•our ability to fund and execute our business plan;•whether our non-Debtor subsidiaries continue to operate their business in the normal course;•the disposition or resolution of all pre-petition claims against us and the Debtors; and•our ability to maintain existing customers and vendor relationships and expand sales to new customers.8The Chapter 11 proceedings may disrupt our business and may materially and adversely affect our operations.We have attempted to minimize the adverse effect of the Debtors’ Chapter 11 proceedings on our relationships with our employees, suppliers, customers and otherparties. Nonetheless, our relationships with our customers, suppliers, and employees may be adversely impacted by negative publicity or otherwise and ouroperations could be materially and adversely affected. In addition, the Chapter 11 proceedings could negatively affect our ability to attract new employees andretain existing high performing employees or executives, which could materially and adversely affect our operations.The Chapter 11 proceedings limit the flexibility of our management team in running the Debtors’ business.While the Debtors’ operate their businesses as debtors-in-possession under supervision by the Bankruptcy Court, the Bankruptcy Court approval is required withrespect to certain aspects of the Debtors’ business, and in some cases certain holders of claims against CEOC who have entered into the RSAs, prior to engaging inactivities or transactions outside the ordinary course of business. Bankruptcy Court approval of non-ordinary course activities entails preparation and filing ofappropriate motions with the Bankruptcy Court, negotiation with various parties-in-interest, including the statutory committees appointed in the Chapter 11proceedings, and one or more hearings. Such committees and parties-in-interest may be heard at any Bankruptcy Court hearing and may raise objections withrespect to these motions. This process could delay major transactions and limit the Debtors ability to respond quickly to opportunities and events in themarketplace. Furthermore, in the event the Bankruptcy Court does not approve a proposed activity or transaction, the Debtors could be prevented from engaging innon-ordinary course activities and transactions that they believe are beneficial to them.Additionally, the terms of the final cash collateral order entered by the Bankruptcy Court will limit the Debtors’ ability to undertake certain business initiatives.These limitations may include, among other things, the Debtors’ ability to:•sell assets outside the normal course of business;•consolidate, merge, sell or otherwise dispose of all or substantially all of the Debtors’ assets;•grant liens;•incur debt for borrowed money outside the ordinary course of business;•prepay prepetition obligations; and•finance the Debtors’ operations, investments or other capital needs or to engage in other business activities that would be in the Debtors’ interests.We will require significant liquidity to fund the Third Amended Plan, which may negatively affect our liquidity and ability to sustain operations.As described in Note 1 , we have made material commitments to support for Restructuring. As a result of the Bankruptcy Court’s confirmation of the ThirdAmended Plan, we believe it is probable that certain obligations described in the Third Amended Plan and the RSAs will ultimately be settled, and therefore, wehave accrued the items described in Note 1 that are estimable. We estimated the total consideration we expect to provide in support of the Restructuring, whichincludes a combination of cash, CEC common stock, and CEC Convertible Notes. Our estimated accrual does not include certain consideration that will be issuedas part of the acquisition of New CEOC (as defined below), which will be recorded when the transaction is consummated, or other amounts that either do notcurrently represent obligations or that cannot be estimated at this time.CEC does not currently have sufficient cash to meet its financial commitments to support the Restructuring that are due when the Debtors ultimately emerge frombankruptcy. The completion of the Merger (as defined below) is expected to allow CEC to fulfill its financial commitments in support of the Restructuring.As a result of these payments and investments, less cash may be available in future periods for investments and operating expenses and, as a result, theimplementation of the Third Amended Plan may have a negative impact on our liquidity and on our ability to sustain our operations.Pursuant to the Third Amended Plan, CEOC will be divided into OpCo and PropCo, with certain of CEOC’s domestic real property interests being divested toPropCo, which may present large cash outflows, transaction costs and execution risk.Pursuant to the Third Amended Plan, CEOC will be divided into two companies: OpCo and PropCo. OpCo, as CEOC’s successor (the “New CEOC”) and a whollyowned subsidiary of CEC, will operate CEOC’s properties and facilities. PropCo, as a subsidiary of a real estate investment trust to be wholly separate from CEC,will hold certain of CEOC’s domestic real property assets and9related non-gaming fixtures and will lease those assets back to OpCo. As part of the Third Amended Plan, CEC and its subsidiaries will be entering into the certainagreements in connection the restructuring of CEOC, including management and lease support agreements, which will create certain material commitments for andimpose ongoing obligations on the business of the Company after the effective date of the Third Amended Plan. This restructuring of CEOC will involvesignificant cash outflows, transaction costs and expenses, which may result in us having less cash available in future periods for investments and operatingexpenses.Additionally, the implementation and execution of the Third Amended Plan, and the completion of the restructuring of CEOC contemplated thereunder, will be acomplex, costly and time-consuming process. We will be required to devote management attention and resources and engage outside advisors and consultants toimplement the Third Amended Plan and complete the restructuring. The failure to meet the challenges involved in implementing of the Third Amended Plan andcompleting the restructuring could cause an interruption of, or a loss of momentum in, the activities of the Company and could adversely affect our results ofoperations after the Debtors’ emergence from bankruptcy. The unsuccessful implementation of the Third Amended Plan and the failure to complete therestructuring could lead to additional litigation, bankruptcy proceedings and negotiations with creditors and other third parties, with increasing transaction costsand legal and financial liabilities. The overall implementation of the Third Amended Plan and the completion of the restructuring may also result in materialunanticipated problems, expenses, liabilities, competitive responses, loss of customer and other business relationships and diversion of our management’s attention.Under the Third Amended Plan, CEC and New CEOC will be required to enter into certain leasing and financial commitments, which may have a negativeimpact on our business and operating condition.Pursuant to the Third Amended Plan, CEC and New CEOC will be entering into the certain restructuring documents, including the two Master Lease Agreementsand the management and lease support agreements. Pursuant to the Master Lease Agreements, certain subsidiaries of PropCo will lease properties to New CEOCand New CEOC will be responsible for lease payments and other monetary obligations: (1) for the Caesars Palace Las Vegas property and (2) for certain domesticproperties currently owned by CEOC other than Caesars Palace Las Vegas. CEC will guarantee all monetary obligations of New CEOC under the Master LeaseAgreements pursuant to the terms of the management and lease support agreements. Under the call right agreements among PropCo, CEC, CERP, CGP and theirrespective applicable subsidiaries entered into pursuant to the Third Amended Plan, PropCo will have the right to purchase and leaseback interests in the realproperty and the related fixtures associated with Harrah’s Laughlin, Harrah’s Atlantic City and Harrah’s New Orleans properties, which could also imposeadditional lease payments and other obligations. CEC and PropCo will also enter into a right of first refusal agreement that will provide, among other things, (a) agrant by CEC (by and on behalf of itself and all of its majority owned subsidiaries) to PropCo (by and on behalf of itself and all of its majority owned subsidiaries)of a right of first refusal to own and lease to an affiliate of CEC certain non-Las Vegas domestic real estate that CEC or its affiliates may have the opportunity toacquire or develop and (b) a grant by PropCo to CEC of a right of first refusal to lease and manage certain non-Las Vegas domestic real estate that PropCo mayhave the opportunity to acquire or develop.CEC and New CEOC also anticipate entering into certain proposed credit documents. Under the indenture that will govern the CEC Convertible Notes, CEC willissue approximately $1.1 billion of Convertible Notes at 5.00% per annum that will mature in 2024. Additionally, New CEOC will have funded debt obligations ofapproximately $1.2 billion (“New CEOC Debt”). The Third Amended Plan requires New CEOC to issue the New CEOC Debt to third parties, but if the NewCEOC Debt is not fully syndicated, then the New CEOC Debt may be comprised of up to $917 million in first lien term loans and $318 million of first lien notesissued to the Debtors’ creditors under the Third Amended Plan (the “New CEOC Take-Back Debt”), subject to the consent of the applicable creditor groups. CECwill be required to guarantee the New CEOC Take-Back Debt. Under the terms of the guarantees of the New CEOC Take-Back Debt, CEC will provide a modifiedcollection guarantee of the New CEOC Take-Back Debt, secured by a first-priority pledge of substantially all of the material assets of CEC, subject to certainexceptions.After the Debtors’ emergence from bankruptcy, CEC will have certain obligations arising from the restructuring documents. If our businesses and properties fail togenerate sufficient earnings, the payments required to service these leasing and financial commitments may materially and adversely limit our ability to makeinvestments to maintain and grow our portfolio of businesses and properties. Additionally, we may be subject to other significant obligations under our guaranteesif New CEOC is unable to satisfy its lease payments and monetary obligations under these arrangements, which could materially and adversely affect our businessand operating results.The restructuring documents will require us to comply with covenants on the conduct of business and generally impose restrictions on our business activities,including restrictions relating to the incurrence of debt, sales or dispositions of assets, acquisitions, the granting of liens, dividends and distributions and affiliatetransactions. Compliance with the covenants and restrictions in the restructuring documents may constrain our ability to implement any growth plans as well as itsflexibility to react and adapt to unexpected operational challenges and adverse changes in economic and legal conditions. 10The merger with CAC is subject to various closing conditions, including governmental approvals, and other uncertainties and there can be no assurances as towhether and when it may be completed.In 2014, CEC and CAC entered into a merger agreement, which was amended and restated on July 9, 2016 (the “Merger Agreement”), under which CAC willmerge with and into Caesars Entertainment, with Caesars Entertainment continuing as the surviving corporation (the “Merger”). The consummation of the Mergeris subject to a number of closing conditions, many of which are not within Caesars Entertainment’s control, and failure to satisfy such conditions may prevent,delay or otherwise materially adversely affect the completion of the transaction. These conditions include, among other things, obtaining (1) the required votes forthe adoption of the Merger Agreement and the approval of the Merger by the our stockholders and the stockholders of CAC, (2) any necessary licenses, consents orother approvals required by gaming authorities to effect the Merger, (3) the authorization of NASDAQ for the listing of the shares of our common stock to beissued in connection with the Merger, (4) confirmation of the Third Amended Plan by the Bankruptcy Court, which was obtained on January 17, 2017, (5) receiptof certain tax opinions or rulings regarding certain tax aspects of the restructuring of CEOC, which rulings were received on January 5, 2017 and (6) receipt byeach of CEC and CAC of the opinion of its respective counsel regarding the intended tax treatment of the Merger. It also is possible that a change, event, fact,effect or circumstance that could lead to a material adverse effect on Caesars Entertainment may occur, which may result in CAC not being obligated to completethe Merger. We cannot predict with certainty whether and when any of the required closing conditions will be satisfied or if an uncertainty resulting in a materialadverse effect on Caesars Entertainment may arise. If the Merger does not receive, or timely receive, the required regulatory approvals and clearances, or if anotherevent occurs delaying or preventing the Merger, such delay or failure to complete the Merger may cause uncertainty or other negative consequences that maymaterially and adversely affect Caesars Entertainment’s business, financial performance and operating results and the price per share for Caesar Entertainment’scommon stock. There can be no assurance that the conditions to the Merger will be satisfied in a timely manner or at all. If conditions are not met or are incapableof being met, we and/or CAC may be entitled to terminate the Merger Agreement. In no event can the Merger be completed later than December 31, 2017, unlesswe and CAC otherwise mutually agree.Additionally, we are subject to litigation which, if decided adversely, may increase the risk the conditions to completion of the Merger are not satisfied. Adverserulings may result in reinstatement of our guarantee of certain CEOC debt which could increase the risk that conditions to completion of the Merger are notsatisfied.In the event that the pending Merger is not completed, the trading price of our common stock and our future business and financial results may be negativelyimpacted.As noted above, the conditions to the completion of the Merger may not be satisfied. If the Merger is not completed for any reason, we may be subject to a numberof risks, including:•the failure of the contemplated Third Amended Plan, for which completing the Merger is a condition, which failure will lead to further bankruptcyproceedings and negotiations with creditors as well as additional costs, litigation and legal liabilities;•the inability to achieve the global settlement of claims and comprehensive releases in favor of us and our affiliates provided for in the Third AmendedPlan;•we would still being liable for significant transaction costs;•the focus of our management having been diverted from seeking other potential opportunities without realizing any benefits of the completed merger;•experiencing negative reactions from our customers, suppliers, regulators and employees;•certain litigation against us remaining outstanding and not being released; and•the price of our common stock declining significantly from current market price, which may reflect a market assumption that the Merger will becompleted.If the Merger is not completed, the risks described above may materialize and adversely affect our business, financial condition, financial results and stock price.Following the Merger and the Third Amended Plan, the composition of our directors and officers will be different.Upon completion of the Merger, the composition of our directors and officers will be different than the current composition. Our board of directors currentlyconsists of eleven directors. The Merger Agreement provides that prior to the effective time of the11Merger, that the directors and officers of CEC be mutually and reasonably agreed between us and CAC. Additionally, the Third Amended Plan requires that acertain number of independent directors be appointed to our board and that same director appointments be subject to the consent of some of the Debtors’ creditors.With a different composition of our directors and officers, the management and direction of the Company following the Merger may be different than the currentmanagement and direction of the Company, and accordingly, may also result in new business plans and growth strategies as well as divergences from or alterationsto existing ones. Any new business plans or growth strategies implemented by the new composition of our directors and officers or any divergences from oralternations to existing business plans and strategies, if unsuccessful, may lead to material unanticipated problems, expenses, liabilities, competitive responses, lossof customer and other business relationships, and an adverse impact on our operations and financial results.As a result of the Chapter 11 proceedings, our historical financial information will not be indicative of our future financial performance.Our capital structure and our corporate structure will be significantly altered under any plan of reorganization. As of January 15, 2015, CEOC was deconsolidatedfrom our financial statements. Consequently, our results of operations following the deconsolidation will not be comparable to the financial condition and results ofoperations reflected in our historical financial statements for periods prior to the deconsolidation.The Third Amended Plan will be based in large part upon assumptions and analyses developed by CEOC. If these assumptions and analyses prove to beincorrect, the Third Amended Plan may be unsuccessful in its execution, which could adversely affect Caesars Entertainment.The Third Amended Plan to be implemented could affect both the Debtors’ capital structure and the ownership, structure and operation of the Debtors’ businessesand will reflect assumptions and analyses based on CEOC’s experience and perception of historical trends, current conditions and expected future developments, aswell as other factors that CEOC considers appropriate under the circumstances. Whether actual future results and developments will be consistent with CEOC’sexpectations and assumptions depends on a number of factors, including but not limited to (i) CEOC’s ability to substantially change the Debtors’ capital structure;(ii) CEOC’s ability to restructure the Debtors as a separate operating company and property company, with a real estate investment trust directly or indirectlyowning and controlling the property company, (iii) the ability of the Debtors to obtain adequate liquidity and financing sources; (iv) our ability to maintaincustomers’ confidence in our viability as a continuing entity and to attract and retain sufficient business from them; (v) the Debtors’ ability to retain keyemployees; and (vi) the overall strength and stability of general economic conditions in the U.S. and in global markets. The failure of any of these factors couldmaterially adversely affect the successful reorganization of the Debtors’ businesses.In addition, the Third Amended Plan will rely upon financial projections, including with respect to revenues, capital expenditures, debt service, and cash flow aswell as earnings before interest, taxes, depreciation and amortization (“EBITDA”). Financial forecasts are necessarily speculative, and it is likely that one or moreof the assumptions and estimates that are the basis of these financial forecasts will not be accurate. The forecasts for the Debtors will be even more speculative thannormal, because they may involve fundamental changes in the nature of the Debtors’ capital structure and corporate structure. Accordingly, CEOC expects that itsactual financial condition and results of operations will differ, perhaps materially, from what CEOC has anticipated. Consequently, there can be no assurance thatthe results or developments contemplated by the Third Amended Plan to be implemented by the Debtors will occur or, even if they do occur, that they will have theanticipated effects on the Debtors and their subsidiaries’ businesses or operations. The failure of any such results or developments to materialize as anticipatedcould materially adversely affect us.Risks Related to Our BusinessOur substantial indebtedness and the fact that a significant portion of our cash flow is used to make interest payments could adversely affect our ability to raiseadditional capital to fund our operations, limit our ability to react to changes in the economy or our industry and prevent us from making debt servicepayments.Caesars Entertainment is a highly-leveraged company and had $6.9 billion in debt outstanding as of December 31, 2016 . As a result, a significant portion of ourliquidity needs are for debt service, including significant interest payments. Our estimated debt service (including principal and interest) is $659 million for 2017and $8.8 billion thereafter to maturity. See Note 11 for details of our debt outstanding and related restrictive covenants.Our substantial indebtedness and the restrictive covenants under the agreements governing such indebtedness could:•limit our ability to borrow money for our working capital, capital expenditures, development projects, debt service requirements, strategic initiatives orother purposes;12•make it more difficult for us to satisfy our obligations with respect to our indebtedness, and any failure to comply with the obligations of any of our debtinstruments, including restrictive covenants and borrowing conditions, could result in an event of default under the agreements governing ourindebtedness;•require that a substantial portion of our cash flow from operations be dedicated to the payment of interest and repayment of our indebtedness, therebyreducing funds available to us for other purposes;•limit our flexibility in planning for, or reacting to, changes in our operations or business;•make us more highly-leveraged than certain of our competitors, which may place us at a competitive disadvantage;•make us more vulnerable to downturns in our business or the economy;•restrict the availability for us to make strategic acquisitions, develop new gaming facilities, introduce new technologies or exploit business opportunities;•affect our ability to renew certain gaming and other licenses;•limit, along with the financial and other restrictive covenants in our indebtedness, among other things, our ability to borrow additional funds or dispose ofassets; and•expose us to the risk of increased interest rates as certain of our borrowings are at variable rates of interest.Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations, prospects and ability to satisfy our outstandingdebt obligations.We may be unable to generate sufficient cash to service all of our indebtedness, and may be forced to take other actions to satisfy our obligations under ourindebtedness that may not be successful.We may be unable to generate sufficient cash flow from operations, or may be unable to draw under our senior secured credit facilities or otherwise, in an amountsufficient to fund our liquidity needs. Our operating cash inflows are typically used for operating expenses, debt service costs, working capital needs, and capitalexpenditures in the normal course of business. Our operating cash flow was negative $57 million in 2015 and $308 million in 2016 . Our estimated debt service(including principal and interest) is $659 million for 2017 and $8.8 billion thereafter to maturity. See Note 11 for details of our debt outstanding.We may incur additional indebtedness, which could adversely affect our ability to pursue certain business opportunities.We and our subsidiaries may incur additional indebtedness. Although the terms of the agreements governing our indebtedness contain restrictions on our ability toincur additional indebtedness, these restrictions are subject to a number of important qualifications and exceptions, and the indebtedness incurred in compliancewith these restrictions could be substantial.For example, as of December 31, 2016 , CERP had $230 million of additional borrowing capacity available under its senior secured revolving credit facility, andCGP had a total of $160 million of additional borrowing capacity available under its senior secured revolving credit facilities.Our subsidiary debt agreements allow for limited future issuances of additional secured notes or loans, which may include, in each case, indebtedness secured on apari passu basis with the obligations under CGP’s or CERP's credit facilities and first lien notes. This indebtedness could be used for a variety of purposes,including financing capital expenditures, refinancing or repurchasing our outstanding indebtedness, including existing unsecured indebtedness, or for generalcorporate purposes. We have raised and expect to continue to raise debt, including secured debt, to directly or indirectly refinance our outstanding unsecured debton an opportunistic basis, as well as development and acquisition opportunities. Additional indebtedness would require greater servicing payments, andaccordingly, may affect our future liquidity and limit our ability to pursue certain opportunities and implement any growth plans in the future.Our debt agreements contain restrictions that limit our flexibility in operating our business.Our debt agreements contain, and any future indebtedness of ours would likely contain, a number of covenants that impose significant operating and financialrestrictions, including restrictions on the issuer of the debt’s ability to, among other things:•incur additional debt or issue certain preferred shares;•pay dividends on or make distributions in respect of our capital stock or make other restricted payments;13•make certain investments;•sell certain assets;•create liens on certain assets;•consolidate, merge, sell or otherwise dispose of all or substantially all of our assets;•enter into certain transactions with our affiliates; and•designate our subsidiaries as unrestricted subsidiaries.As a result of these covenants, we are limited in the manner in which we conduct our business, and we may be unable to engage in favorable business activities orfinance future operations or capital needs.We have pledged and will pledge a significant portion of our assets as collateral under our subsidiaries’ debt agreements. If any of our lenders accelerate therepayment of borrowings, there can be no assurance that we will have sufficient assets to repay our indebtedness.We are required to satisfy and maintain specified financial ratios under our debt agreements. See Note 11 for further information. Our ability to meet the financialratios under our debt agreements can be affected by events beyond our control, and there can be no assurance that we will be able to continue to meet those ratios.A failure to comply with the covenants contained in the agreements that govern our indebtedness could result in an event of default under the facilities or theexisting agreements, which, if not cured or waived, could have a material adverse effect on our business, financial condition and results of operations. In the eventof any default under the indebtedness of CERP or CGP, the lenders thereunder:•will not be required to lend any additional amounts to such borrowers;•could elect to declare all borrowings outstanding, together with accrued and unpaid interest and fees, to be due and payable and terminate allcommitments to extend further credit; or•require such borrowers to apply all of our available cash to repay these borrowings.Such actions by the lenders under CERP’s or CGP’s indebtedness could cause cross defaults under the other indebtedness of CERP and CGP, respectively. Forinstance, if CERP were unable to repay those amounts, the lenders under CERP’s credit facilities and the holders of CERP’s secured notes could proceed againstthe collateral granted to them to secure that indebtedness.If the indebtedness under CERP’s or CGP’s credit facilities, or other indebtedness were to be accelerated, there can be no assurance that their assets would besufficient to repay such indebtedness in full.Repayment of our subsidiaries’ debt is dependent on cash flow generated by our subsidiaries.Our subsidiaries currently own a significant portion of our assets and conduct a significant portion of our operations. Accordingly, repayment of our subsidiaries’indebtedness is dependent, to a significant extent, on the generation of cash flow by our subsidiaries and their ability to make such cash available by dividend, debtrepayment or otherwise. Our subsidiaries do not have any obligation to pay amounts due on our other subsidiaries’ indebtedness or to make funds available for thatpurpose. Our subsidiaries may not be able to, or may not be permitted to, make distributions to enable us to make payments in respect of our other subsidiaries’indebtedness. Each subsidiary is a distinct legal entity and, under certain circumstances, legal and contractual restrictions may limit our ability to obtain cash fromour subsidiaries.We are or may become involved in legal proceedings that, if adversely adjudicated or settled, could have a material adverse effect on our business, financialcondition, results of operations, and prospects.In addition to the Noteholder Disputes discussed above, we are also a defendant from time to time in various lawsuits or other legal proceedings relating to mattersincidental to our business. The nature of our business subjects us to the risk of lawsuits filed by customers, past and present employees, competitors, businesspartners, Indian tribes and others in the ordinary course of business. As with all legal proceedings, no assurance can be provided as to the outcome of these mattersand in general, legal proceedings can be expensive and time consuming. We may not be successful in the defense or prosecution of these lawsuits, which couldresult in settlements or damages that could significantly impact our business, financial condition and results of operations.14The loss of the services of key personnel could have a material adverse effect on our business.We believe that the leadership of our executive officers has been a critical element of our success. Any unforeseen loss of our chief executive officer’s services, orany negative market or industry perception with respect to him or arising from his loss, could have a material adverse effect on our businesses. Our other executiveofficers and other members of senior management have substantial experience and expertise in our businesses that we believe will make significant contributions toour growth and success. The unexpected loss of services of one or more of these individuals could also adversely affect us. We do not have key man or similar lifeinsurance policies covering members of our senior management. We have employment agreements with our executive officers, but these agreements do notguarantee that any given executive will remain with us, and there can be no assurance that any such officers will remain with us.If we cannot attract, retain and motivate employees, we may be unable to compete effectively, and lose the ability to improve and expand our businesses.Our success and ability to grow depend, in part, on our ability to hire, retain, and motivate sufficient numbers of talented people with the increasingly diverse skillsneeded to serve clients and expand our business, in many locations around the world. We face intense competition for highly qualified, specialized technical,managerial, and consulting personnel. Recruiting, training, retention and benefit costs place significant demands on our resources. Additionally, our substantialindebtedness and CEOC’s Chapter 11 proceedings have made recruiting executives to our businesses more difficult, which may become even more difficult as theCEOC Chapter 11 proceedings progress. The inability to attract qualified employees in sufficient numbers to meet particular demands or the loss of a significantnumber of our employees could have an adverse effect on us.We may sell or divest different properties or assets as a result of our evaluation of our portfolio of businesses. Such sales or divestitures could affect our costs,revenues, profitability and financial position.From time to time, we evaluate our properties and our portfolio of businesses and may, as a result, sell or attempt to sell, divest or spin-off different properties orassets. These sales or divestitures affect our costs, revenues, profitability, financial position, liquidity and our ability to comply with our debt covenants.Divestitures have inherent risks, including possible delays in closing transactions (including potential difficulties in obtaining regulatory approvals), the risk oflower-than-expected sales proceeds for the divested businesses, and potential post-closing claims for indemnification. In addition, current economic conditions andrelatively illiquid real estate markets may result in fewer potential bidders and unsuccessful sales efforts. Expected costs savings, which are offset by revenuelosses from divested properties, may also be difficult to achieve or maximize due to our fixed cost structure.Reduction in discretionary consumer spending resulting from a downturn in the national economy, the volatility and disruption of the capital and creditmarkets, adverse changes in the global economy and other factors could negatively impact our financial performance and our ability to access financing.Changes in discretionary consumer spending or consumer preferences are driven by factors beyond our control, such as perceived or actual general economicconditions; high energy, fuel and other commodity costs; the cost of travel; the potential for bank failures; a soft job market; an actual or perceived decrease indisposable consumer income and wealth; increases in payroll taxes; increases in gaming taxes or fees; fears of recession and changes in consumer confidence in theeconomy; and terrorist attacks or other global events. Our business is susceptible to any such changes because our casino properties offer a highly discretionary setof entertainment and leisure activities and amenities. Gaming and other leisure activities we offer represent discretionary expenditures and participation in suchactivities may decline if discretionary consumer spending declines, including during economic downturns, during which consumers generally earn less disposableincome. Particularly, we have business concentrations in gaming offerings and in Las Vegas, which are sensitive to declines in discretionary consumer spendingand changes in consumer preferences. The economic downturn that began in 2008 and adverse conditions in the local, regional, national and global marketsnegatively affected our business and results of operations and may negatively affect our operations in the future. During periods of economic contraction, ourrevenues may decrease while most of our costs remain fixed and some costs even increase, resulting in decreased earnings. While economic conditions haveimproved and the gaming industry has partially recovered, there are no assurances that the gaming industry will continue to grow.15Additionally, key determinants of our revenues and operating performance include hotel average daily rate (“ADR”), number of gaming trips and average spendper trip by our customers. Given that 2007 was the peak year for our financial performance and the gaming industry in the United States in general, we may notattain those financial levels in the near term, or at all. If we fail to increase ADR or any other similar metric in the near term, our revenues may not increase and, asa result, we may not be able to pay down our existing debt, fund our operations, fund planned capital expenditures or achieve expected growth rates, all of whichcould have a material adverse effect on our business, financial condition, results of operations and cash flow. Even an uncertain economic outlook may adverselyaffect consumer spending in our gaming operations and related facilities, as consumers spend less in anticipation of a potential economic downturn. Furthermore,other uncertainties, including national and global economic conditions, terrorist attacks or other global events, could adversely affect consumer spending andadversely affect our operations.Growth in consumer demand for non-gaming offerings could negatively impact our gaming revenue.Although recent trends have indicated a growing shift in customer demand for gambling over non-gaming offerings when visiting Las Vegas, there are noassurances that this trend will continue and that demand for non-gaming offerings will not increase. According to Las Vegas Convention and Visitors Authority,47% of Las Vegas visitors in 2015 indicated that their primary reason to visit was for vacation or pleasure as opposed to solely for gambling as the main attraction,up from 41% of visitors in 2013, but down from 50% of visitors in 2011. To the extent the demand for non-gaming offerings replaces demand for gambling, ourgaming revenues will decrease, which could have an adverse impact on our business and results of operations.We are subject to extensive governmental regulation, which, under certain circumstances, could adversely impact our business, financial condition, and resultsof operations.We are subject to extensive gaming regulations and political and regulatory uncertainty. Regulatory authorities in the jurisdictions where we operate have broadpowers with respect to the licensing of casino operations and may revoke, suspend, condition or limit our gaming or other licenses, impose substantial fines andtake other actions, any one of which could adversely impact our business, financial condition and results of operations. For example, revenues and income fromoperations were negatively impacted during July 2006 in Atlantic City by a three-day government-imposed casino shutdown. Furthermore, in many jurisdictionswhere we operate, licenses are granted for limited durations and require renewal from time to time. For example, in Iowa, our ability to continue our gamingoperations is subject to a referendum every eight years or at any time upon petition of the voters in the county in which we operate; the most recent referendumwhich approved our ability to continue to operate our casinos occurred in November 2010. There can be no assurance that continued gaming activity will beapproved in any referendum in the future. If we do not obtain the requisite approval in any future referendum, we will not be able to operate our gaming operationsin Iowa, which would negatively impact our future performance.From time to time, individual jurisdictions have also considered legislation or referendums, such as bans on smoking in casinos and other entertainment and diningfacilities, which could adversely impact our operations. For example, the City Council of Atlantic City passed an ordinance in 2007 requiring that we segregate atleast 75% of the casino gaming floor as a nonsmoking area, leaving no more than 25% of the casino gaming floor as a smoking area. Illinois also passed the SmokeFree Illinois Act which became effective January 1, 2008, and bans smoking in nearly all public places, including bars, restaurants, work places, schools andcasinos. The Smoke Free Illinois Act also bans smoking within 15 feet of any entrance, window or air intake area of these public places. In January 2015, the Cityof New Orleans passed a ban on indoor smoking and use of electronic cigarettes, which became effective in April 2015. These smoking bans have adverselyaffected revenues and operating results at our properties. The likelihood or outcome of similar legislation in other jurisdictions and referendums in the futurecannot be predicted, though any smoking ban would be expected to negatively impact our financial performance.Furthermore, because we are subject to regulation in each jurisdiction in which we operate, and because regulatory agencies within each jurisdiction review ourcompliance with gaming laws in other jurisdictions, it is possible that gaming compliance issues in one jurisdiction may lead to reviews and compliance issues inother jurisdictions.Our stockholders are subject to extensive governmental regulation and if a stockholder is found unsuitable by the gaming authority, that stockholder would notbe able to beneficially own our common stock directly or indirectly.In many jurisdictions, gaming laws can require any of our stockholders to file an application, be investigated, and qualify or have his, her or its suitabilitydetermined by gaming authorities. Gaming authorities have very broad discretion in determining whether an applicant should be deemed suitable. Subject tocertain administrative proceeding requirements, the gaming regulators have the authority to deny any application or limit, condition, restrict, revoke or suspend anylicense, registration, finding of suitability or approval, or fine any person licensed, registered or found suitable or approved, for any cause deemed reasonable bythe gaming authorities. For additional information on the criteria used in making determinations regarding suitability, see “Governmental Regulation.”16For example, under Nevada gaming laws, each person who acquires, directly or indirectly, beneficial ownership of any voting security, or beneficial or recordownership of any non-voting security or any debt security, in a public corporation which is registered with the Nevada Gaming Commission, or the GamingCommission, may be required to be found suitable if the Gaming Commission has reason to believe that his or her acquisition of that ownership, or his or hercontinued ownership in general, would be inconsistent with the declared public policy of Nevada, in the sole discretion of the Gaming Commission. Any personrequired by the Gaming Commission to be found suitable must apply for a finding of suitability within 30 days after the Gaming Commission's request that he orshe should do so and, together with his or her application for suitability, deposit with the Nevada Gaming Control Board, or the Control Board, a sum of moneywhich, in the sole discretion of the Control Board, will be adequate to pay the anticipated costs and charges incurred in the investigation and processing of thatapplication for suitability, and deposit such additional sums as are required by the Control Board to pay final costs and charges.Furthermore, any person required by a gaming authority to be found suitable, who is found unsuitable by the gaming authority, may not hold directly or indirectlythe beneficial ownership of any voting security or the beneficial or record ownership of any nonvoting security or any debt security of any public corporationwhich is registered with the gaming authority beyond the time prescribed by the gaming authority. A violation of the foregoing may constitute a criminal offense.A finding of unsuitability by a particular gaming authority impacts that person's ability to associate or affiliate with gaming licensees in that particular jurisdictionand could impact the person's ability to associate or affiliate with gaming licensees in other jurisdictions.Many jurisdictions also require any person who acquires beneficial ownership of more than a certain percentage of voting securities of a gaming company and, insome jurisdictions, non-voting securities, typically 5%, to report the acquisition to gaming authorities, and gaming authorities may require such holders to apply forqualification or a finding of suitability, subject to limited exceptions for “institutional investors” that hold a company's voting securities for investment purposesonly. Under Maryland gaming laws, we may not sell or otherwise transfer more than 5% of the legal or beneficial interest in Horseshoe Baltimore without theapproval of the Maryland Lottery and Gaming Control Commission, or the Maryland Commission, after the Maryland Commission determines that the transfereeis qualified or grants the transferee an institutional investor waiver.Some jurisdictions may also limit the number of gaming licenses in which a person may hold an ownership or a controlling interest. In Indiana, for example, aperson may not have an ownership interest in more than two Indiana riverboat owner's licenses, and in Maryland an individual or business entity may not own aninterest in more than one video lottery facility.If we are unable to effectively compete against our competitors, our profits will decline.The gaming industry is highly competitive and our competitors vary considerably in size, quality of facilities, number of operations, brand identities, marketingand growth strategies, financial strength and capabilities, and geographic diversity. We also compete with other non-gaming resorts and vacation areas, and withvarious other entertainment businesses. Our competitors in each market that we participate may have greater financial, marketing, or other resources than we do,and there can be no assurance that they will not engage in aggressive pricing action to compete with us. Although we believe we are currently able to competeeffectively in each of the various markets in which we participate, we cannot ensure that we will be able to continue to do so or that we will be capable ofmaintaining or further increasing our current market share. Our failure to compete successfully in our various markets could adversely affect our business, financialcondition, results of operations, and cash flow.In recent years, many casino operators, including us, have been reinvesting in existing markets to attract new customers or to gain market share, thereby increasingcompetition in those markets. As companies have completed new expansion projects, supply has typically grown at a faster pace than demand in some markets,including Las Vegas, our largest market, and competition has increased significantly. For example, SLS Las Vegas opened in August 2014 on the northern end ofthe Strip, and the Genting Group has announced plans to develop a casino and hotel called Resorts World Las Vegas, which is expected to open in 2019 on thenorthern end of the Strip. Also, in response to changing trends, Las Vegas operators have been focused on expanding their non-gaming offerings, includingupgrades to hotel rooms, new food and beverage offerings, and new entertainment offerings. MGM's The Park and joint venture with AEG, T-Mobile Arena,located between New York-New York and Monte Carlo, opened in April 2016 and includes retail and dining options and a 20,000 seat indoor arena for sportingevents and concerts. In addition, in June 2016, MGM announced that the Monte Carlo Resort and Casino will undergo $450 million in non-gaming renovationsfocused on room, food and beverage and entertainment enhancements and is expected to re-open in late 2018 as two newly branded hotels. The expansion ofexisting casino entertainment properties, the increase in the number of properties and the aggressive marketing strategies of many of our competitors haveincreased competition in many markets in which we operate, and this intense competition is expected to continue. These competitive pressures have and areexpected to continue to adversely affect our financial performance in certain markets, including Atlantic City.In particular, our business may be adversely impacted by the additional gaming and room capacity in Nevada. In addition, our operations located in New Jerseymay be adversely impacted by the expansion of gaming in Maryland, New York and Pennsylvania, and our operations located in Nevada may be adverselyimpacted by the expansion of gaming in California.17Theoretical win rates for our casino operations depend on a variety of factors, some of which are beyond our control.The gaming industry is characterized by an element of chance. Accordingly, we employ theoretical win rates to estimate what a certain type of game, on average,will win or lose in the long run. In addition to the element of chance, theoretical win rates are also affected by the spread of table limits and factors that are beyondour control, such as a player's skill and experience and behavior, the mix of games played, the financial resources of players, the volume of bets placed and theamount of time players spend gambling. As a result of the variability in these factors, the actual win rates at the casino may differ from theoretical win rates andcould result in the winnings of our gaming customers exceeding those anticipated. The variability of these factors, alone or in combination, have the potential tonegatively impact our actual win rates, which may adversely affect our business, financial condition, results of operations and cash flows.We face the risk of fraud, theft, and cheating.We face the risk that gaming customers may attempt or commit fraud or theft or cheat in order to increase winnings. Such acts of fraud, theft, or cheating couldinvolve the use of counterfeit chips or other tactics, possibly in collusion with our employees. Internal acts of cheating could also be conducted by employeesthrough collusion with dealers, surveillance staff, floor managers or other casino or gaming area staff. Additionally, we also face the risk that customers mayattempt or commit fraud or theft with respect to our non-gaming offerings or against other customers. Such risks include stolen credit or charge cards or cash,falsified checks, theft of retail inventory and purchased goods, and unpaid or counterfeit receipts. Failure to discover such acts or schemes in a timely manner couldresult in losses in our gaming operations. Negative publicity related to such acts or schemes could have an adverse effect on our reputation, potentially causing amaterial adverse effect on our business, financial condition, results of operations and cash flows.Use of the “Caesars” brand name, or any of our other brands, by entities other than us could damage the brands and our operations and adversely affect ourbusiness and results of operations.The “Caesars” brand remains one of the most recognized casino brands in the world and our operations benefit from the global recognition and reputationgenerated by our brands. Generally, we are actively pursuing gaming and non-gaming management, branding, and development opportunities in Asia and otherparts of the world where our brands and reputation are already well-recognized assets. In addition, we will continue to expand our World Series of Pokertournaments to international jurisdictions where we believe there is a likelihood of legalization of online gaming, in order to grow the brand’s awareness. Inconnection with such opportunities, we intend to grant third parties licenses to use our brands. Our business and results of operations may be adversely affected bythe management or the enforcement of the “Caesars” and the “World Series of Poker” brand names, or any of our other brands, by third parties outside of ourexclusive control.Any failure to protect our trademarks could have a negative impact on the value of our brand names and adversely affect our business.The development of intellectual property is part of our overall business strategy, and we regard our intellectual property to be an important element of our success.While our business as a whole is not substantially dependent on any one trademark or combination of several of our trademarks or other intellectual property, weseek to establish and maintain our proprietary rights in our business operations and technology through the use of patents, copyrights, trademarks and trade secretlaws. Despite our efforts to protect our proprietary rights, parties may infringe our trademarks and use information that we regard as proprietary and our rights maybe invalidated or unenforceable. The unauthorized use or reproduction of our trademarks could diminish the value of our brand and our market acceptance,competitive advantages or goodwill, which could adversely affect our business.Additionally, we have not applied for the registration of all of our trademarks, copyrights, proprietary technology or other intellectual property rights, as the casemay be, and may not be successful in obtaining all intellectual property rights for which we have applied. Despite our efforts to protect our proprietary rights,parties may infringe upon our intellectual property and use information that we regard as proprietary, and our rights may be invalidated or unenforceable. The lawsof some foreign countries may not protect proprietary rights or intellectual property to as great an extent as do the laws of the United States. In addition, others mayindependently develop substantially equivalent intellectual property.18We extend credit to a portion of our customers and we may not be able to collect gaming receivables from our credit players.We conduct our gaming activities on a credit and cash basis at many of our properties. Any such credit we extend is unsecured. Table games players typically areextended more credit than slot players, and high-stakes players typically are extended more credit than customers who tend to wager lower amounts. High-endgaming is more volatile than other forms of gaming, and variances in win-loss results attributable to high-end gaming may have a significant positive or negativeimpact on cash flow and earnings in a particular quarter. We extend credit to those customers whose level of play and financial resources warrant, in the opinion ofmanagement, an extension of credit. These large receivables could have a significant impact on our results of operations if deemed uncollectible. While gamingdebts evidenced by a credit instrument, including what is commonly referred to as a “marker,” and judgments on gaming debts are enforceable under the currentlaws of the jurisdictions in which we allow play on a credit basis and judgments in such jurisdictions on gaming debts are enforceable in all states under the FullFaith and Credit Clause of the U.S. Constitution, other jurisdictions may determine that enforcement of gaming debts is against public policy. Although courts ofsome foreign nations will enforce gaming debts directly and the assets in the U.S. of foreign debtors may be reached to satisfy a judgment, judgments on gamingdebts from U.S. courts are not binding on the courts of many foreign nations.The development and construction of new hotels, casinos and gaming and non-gaming venues and the expansion of existing ones could have an adverse effecton our business, financial condition and results of operations due to various factors including delays, cost overruns and other uncertainties.We intend to develop, construct and open new hotels, casinos and other gaming venues, and develop and manage non-gaming venues, in response to opportunitiesthat may arise. Future development projects may require significant capital commitments, the incurrence of additional debt, guarantees of third party debt, theincurrence of contingent liabilities and an increase in depreciation and amortization expense, which could have an adverse effect upon our business, financialcondition, results of operations and cash flow. The development and construction of new hotels, casinos and gaming venues and the expansion of existing ones issusceptible to various risks and uncertainties, such as:•the existence of acceptable market conditions and demand for the completed project;•general construction risks, including cost overruns, change orders and plan or specification modification, shortages of construction resources, labordisputes, unforeseen environmental, engineering or geological problems, work stoppages, fire and other natural disasters, construction schedulingproblems, and weather interferences;•changes and concessions required by governmental or regulatory authorities;•the ability to finance the projects, especially in light of our substantial indebtedness;•delays in obtaining, or inability to obtain, all licenses, permits and authorizations required to complete and/or operate the project; and•disruption of our existing operations and facilities.Moreover, our development and expansion projects are sometimes jointly pursued with third parties or by licensing our brands to third parties. These jointdevelopment, expansion projects or license agreements are subject to risks, in addition to those disclosed above, as they are dependent on our ability to reach andmaintain agreements with third parties.Our failure to complete any new development or expansion project, or complete any joint development, expansion projects or projects where we license ourbrands, as planned, on schedule, within budget or in a manner that generates anticipated profits, could have an adverse effect on our business, financial condition,results of operations and cash flow.We may pursue strategic acquisitions of third-party assets and businesses as a complement to our future growth strategy, which could raise materialinvestment risk and affect our businesses and operations if integration is unsuccessful or the acquired assets and businesses perform poorly.We intend to implement a growth plan centered on an organic growth strategy for our non-gaming entertainment, hospitality and leisure offerings. We also intendto pursue strategic acquisitions as a complement to the extent such acquisitions present attractive opportunities that would bolster our organic growth strategy.Additionally, we will also look to become a more active participant in certain high-growth social and mobile gaming opportunities in order to leverage ourextensive experience and management expertise in the gaming industry and build an enhanced high growth portfolio.19Our ability to realize the anticipated benefits of acquisitions will depend, in part, on our ability to integrate the businesses of such acquired company with ourbusinesses. The combination of two independent companies is a complex, costly and time consuming process. This process may disrupt the business of either orboth of the companies, and may not result in the full benefits expected. The difficulties of combining the operations of the companies include, among others:•coordinating marketing functions;•undisclosed liabilities; unanticipated issues in integrating information, communications and other systems;•unanticipated incompatibility of purchasing, logistics, marketing and administration methods;•retaining key employees;•consolidating corporate and administrative infrastructures;•the diversion of management's attention from ongoing business concerns; and•coordinating geographically separate organizations.Additionally, even if integration is successful, the overall integration of acquired assets and businesses may result in material unanticipated problems, expenses,liabilities, competitive responses, loss of customer and other business relationships and diversion of management attention. There is also no guarantee that theacquired assets or businesses will generate any of the projected synergies and earnings growth, and the failure to realize such projected synergies and earningsgrowth may adversely affect our operating and financial results and derail any growth plans.The risks associated with our existing and potential future international operations could reduce our profits.Some of our properties are located outside the United States, and we are currently pursuing additional international opportunities. International operations aresubject to inherent risks including:•political and economic instability;•variation in local economies;•currency fluctuation;•greater difficulty in accounts receivable collection;•trade barriers; and•burden of complying with a variety of international laws.For example, the political instability in Egypt due to the uprising in January 2011 has negatively affected our properties there.Any violation of the Foreign Corrupt Practices Act or other similar laws and regulations could have a negative impact on us.We are subject to risks associated with doing business outside of the United States, which exposes us to complex foreign and U.S. regulations inherent in doingbusiness cross-border and in each of the countries in which it transacts business. We are subject to requirements imposed by the Foreign Corrupt Practices Act(“FCPA”) and other anti-corruption laws that generally prohibit U.S. companies and their affiliates from offering, promising, authorizing or making improperpayments to foreign government officials for the purpose of obtaining or retaining business. Violations of the FCPA and other anti-corruption laws may result insevere criminal and civil sanctions and other penalties and the SEC and U.S. Department of Justice have increased their enforcement activities with respect to theFCPA. Policies and procedures and employee training and compliance programs that we have implemented to deter prohibited practices may not be effective inprohibiting our employees, contractors or agents from violating or circumventing our policies and the law. If our employees or agents fail to comply withapplicable laws or company policies governing our international operations, we may face investigations, prosecutions and other legal proceedings and actionswhich could result in civil penalties, administrative remedies and criminal sanctions. Any determination that we have violated any anti-corruption laws could havea material adverse effect on our financial condition. Compliance with international and U.S. laws and regulations that apply to our international operationsincreases our cost of doing business in foreign jurisdictions. We also deal with significant amounts of cash in our operations and are subject to various reportingand anti-money laundering regulations. Any violation of anti-money laundering laws (“AML”) or regulations, on which in recent years, governmental authoritieshave been increasingly focused, with a particular focus on the gaming industry, by any of our resorts could have a negative effect on our results of operations.20Acts of terrorism, war, natural disasters, severe weather and political, economic and military conditions may impede our ability to operate or may negativelyimpact our financial results.Terrorist attacks and other acts of war or hostility have created many economic and political uncertainties. For example, a substantial number of the customers ofour properties in Las Vegas use air travel. As a result of terrorist acts that occurred on September 11, 2001, domestic and international travel was severelydisrupted, which resulted in a decrease in customer visits to our properties in Las Vegas. We cannot predict the extent to which disruptions in air or other forms oftravel as a result of any further terrorist act, security alerts or war, uprisings, or hostilities in places such as Iraq, Afghanistan and/or Syria or other countriesthroughout the world, and governmental responses to those acts or hostilities, will directly or indirectly impact our business and operating results. For example, ouroperations in Cairo, Egypt were negatively affected from the uprising there in January 2011. As a consequence of the threat of terrorist attacks and other acts ofwar or hostility in the future, premiums for a variety of insurance products have increased, and some types of insurance are no longer available. If any such eventwere to affect our properties, we would likely be adversely impacted.In addition, natural and man-made disasters such as major fires, floods, hurricanes, earthquakes and oil spills could also adversely impact our business andoperating results. Such events could lead to the loss of use of one or more of our properties for an extended period of time and disrupt our ability to attractcustomers to certain of our gaming facilities. If any such event were to affect our properties, we would likely be adversely impacted.In most cases, we have insurance that covers portions of any losses from a natural disaster, but it is subject to deductibles and maximum payouts in many cases.Although we may be covered by insurance from a natural disaster, the timing of our receipt of insurance proceeds, if any, is out of our control. In some cases,however, we may receive no proceeds from insurance.Additionally, a natural disaster affecting one or more of our properties may affect the level and cost of insurance coverage we may be able to obtain in the future,which may adversely affect our financial position.As our operations depend in part on our customers' ability to travel, severe or inclement weather can also have a negative impact on our results of operations.We may incur impairments to goodwill, indefinite-lived intangible assets, or long-lived assets, which could negatively affect our future profits.We perform our annual impairment assessment of goodwill as of October 1, or more frequently if impairment indicators exist. We determine the estimated fairvalue of each reporting unit based on a combination of EBITDA and estimated future cash flows discounted at rates commensurate with the capital structure andcost of capital of comparable market participants, giving appropriate consideration to the prevailing borrowing rates within the casino industry in general. We alsoevaluate the aggregate fair value of all of our reporting units and other non-operating assets in comparison to our aggregate debt and equity market capitalization atthe test date. Both EBITDA multiples and discounted cash flows are common measures used to value and buy or sell businesses in our industry.We also perform an annual impairment assessment of other non-amortizing intangible assets as of October 1, or more frequently if impairment indicators exist. Wedetermine the estimated fair value of our non-amortizing intangible assets by primarily using the Relief From Royalty Method and Excess Earnings Method underthe income approach.We review the carrying value of our long-lived assets whenever events and circumstances indicate that the carrying value of an asset may not be recoverable fromthe estimated future cash flows expected to result from its use and eventual disposition. When performing this assessment, we consider current operating results,trends and prospects, as well as the effect of obsolescence, demand, competition, and other economic, legal, and regulatory factors.Significant negative industry or economic trends, reduced estimates of future cash flows, disruptions to our business, slower growth rates or lack of growth in ourbusiness have resulted in impairment charges during the year ended December 31, 2014. If one or more of such events occurs in the future, additional impairmentcharges may be required in future periods. If we are required to record additional impairment charges, this could have a material adverse impact on ourconsolidated financial statements.Our business is particularly sensitive to energy prices and a rise in energy prices could harm our operating results.We are a large consumer of electricity and other energy and, therefore, higher energy prices may have an adverse effect on our results of operations. Accordingly,increases in energy costs may have a negative impact on our operating results. Additionally, higher electricity and gasoline prices which affect our customers mayresult in reduced visitation to our resorts and a reduction in our revenues. We may be indirectly impacted by regulatory requirements aimed at reducing the impactsof climate change directed at up-stream utility providers, as we could experience potentially higher utility, fuel, and transportation costs.21CGP’s interests may conflict with our interests.The interests of CGP could conflict with our interests. CGP is in a similar business to us and is required to first provide any potential development opportunities tous. However, we may decide to decline the opportunity for the Company’s business and permit CGP to pursue the development opportunity. A committee of ourboard of directors comprised of disinterested directors will consider potential development opportunities provided to us by CGP. If the committee declines anopportunity, that opportunity will be available to CGP and will not be available to our businesses. As a result, our business and growth prospects could benegatively impacted. Furthermore, the consideration of business opportunities may create potential or perceived conflicts of interests between our and CGP'sbusinesses. While we may retain a portion of the financial stake in any management fee to be received in connection with an opportunity provided to CGP, therecan be no assurances that such opportunity will be successful or that we will receive the expected fees from any opportunity.Although certain employees of affiliates of Apollo Global Management, LLC (together with such affiliates, “Apollo”) and affiliates of TPG Capital, LP (togetherwith such affiliates, “TPG” and, together with Apollo, the “Sponsors”) are on the boards of directors of Caesars Entertainment and CAC, the certificates ofincorporation of both companies provide that neither the Sponsors nor directors have any obligation to present any corporate opportunity to Caesars Entertainmentor CAC. Accordingly, the Sponsors may pursue gaming, entertainment or other activities outside of Caesars Entertainment or CAC and have no obligation topresent such opportunity to Caesars Entertainment or CAC.Work stoppages and other labor problems could negatively impact our future profits.Some of our employees are represented by labor unions and, accordingly, we are subject to the risk of work stoppages or other labor disruptions from time to time.We currently have five collective bargaining agreements covering various employees in Las Vegas expiring in 2017 , as well as three others that will expire in2017 .All agreements are subject to automatic extension unless one party gives 30 days’ prior notice of intent to terminate. No such notice has been given. We intend tonegotiate renewal agreements for all collective bargaining agreements expiring and are hopeful that we will be able to reach agreements with the respective unionswithout any work stoppage. Work stoppages and other labor disruptions could have a material adverse impact on our operations. From time to time, we haveexperienced attempts by labor organizations to organize certain of our non-union employees. These efforts have achieved some success to date. We cannot provideany assurance that we will not experience additional and successful union activity in the future. The impact of this union activity is undetermined and couldnegatively impact our profits.We may be subject to material environmental liability, including as a result of unknown environmental contamination.The casino properties business is subject to certain federal, state and local environmental laws, regulations and ordinances which govern activities or operationsthat may have adverse environmental effects, such as emissions to air, discharges to streams and rivers and releases of hazardous substances and pollutants into theenvironment, as well as handling and disposal from municipal/non-hazardous waste, and which also apply to current and previous owners or operators of realestate generally. Federal examples of these laws include the Clean Air Act, the Clean Water Act, the Resource Conservation Recovery Act, the ComprehensiveEnvironmental Response, Compensation and Liability Act and the Oil Pollution Act of 1990. Certain of these environmental laws may impose cleanupresponsibility and liability without regard to whether the owner or operator knew of or caused particular contamination or release of hazardous substances. Shouldunknown contamination be discovered on our property, or should a release of hazardous substances occur on our property, we could be required to investigate andremediate the contamination and could also be held responsible to a governmental entity or third parties for property damage, personal injury or investigation andremediation costs incurred in connection with the contamination or release, which may be substantial. Moreover, such contamination may also impair our ability touse the affected property. Such liability could be joint and several in nature, regardless of fault, and could affect us even if such property is vacated. The potentialfor substantial costs and an inability to use the property could adversely affect our business.22Our insurance coverage may not be adequate to cover all possible losses we could suffer, and, in the future, our insurance costs may increase significantly orwe may be unable to obtain the same level of insurance coverage.We may suffer damage to our property caused by a casualty loss (such as fire, natural disasters and acts of war or terrorism) that could severely disrupt ourbusiness or subject it to claims by third parties who are injured or harmed. Although we maintain insurance (including property, casualty, terrorism and businessinterruption), it may be inadequate or unavailable to cover all of the risks to which our business and assets may be exposed. In several cases we maintain extremelyhigh deductibles or self-insure against specific losses. Should an uninsured loss (including a loss which is less than our deductible) or loss in excess of insuredlimits occur, it could have a significant adverse impact on our operations and revenues.We generally renew our insurance policies on an annual basis. If the cost of coverage becomes too high, we may need to reduce our policy limits or agree to certainexclusions from our coverage in order to reduce the premiums to an acceptable amount. Among other factors, homeland security concerns, other catastrophicevents or any change in the current U.S. statutory requirement that insurance carriers offer coverage for certain acts of terrorism could adversely affect availableinsurance coverage and result in increased premiums on available coverage (which may cause us to elect to reduce our policy limits) and additional exclusionsfrom coverage. Among other potential future adverse changes, in the future we may elect to not, or may be unable to, obtain any coverage for losses due to acts ofterrorism.The success of third parties adjacent to our properties is important to our ability to generate revenue and operate our business and any deterioration to theirsuccess could materially adversely affect our revenue and result of operations.In certain cases, we do not own the businesses and amenities adjacent to our properties. However, the adjacent third-party businesses and amenities stimulateadditional traffic through our complexes, including the casinos, which are our largest generators of revenue. Any decrease in the popularity of, or the number ofcustomers visiting, these adjacent businesses and amenities may lead to a corresponding decrease in the traffic through our complexes, which would negativelyaffect our business and operating results. Further, if newly opened properties are not as popular as expected, we will not realize the increase in traffic through ourproperties that we expect as a result of their opening, which would negatively affect our business projections.Compromises of our information systems or unauthorized access to confidential information or our customers' personal information could materially harmour reputation and business.We collect and store confidential, personal information relating to our customers for various business purposes, including marketing and financial purposes, andcredit card information for processing payments. For example, we handle, collect and store personal information in connection with our customers staying at ourhotels and enrolling in our Total Rewards program. We may share this personal and confidential information with vendors or other third parties in connection withprocessing of transactions, operating certain aspects of our business or for marketing purposes. Our collection and use of personal data are governed by state andfederal privacy laws and regulations as well as the applicable laws and regulations in other countries in which we operate. Privacy law is an area that changes oftenand varies significantly by jurisdiction. We may incur significant costs in order to ensure compliance with the various applicable privacy requirements. In addition,privacy laws and regulations may limit our ability to market to our customers.We assess and monitor the security of collection, storage and transmission of customer information on an ongoing basis. We utilize commercially availablesoftware and technologies to monitor, assess and secure our network. Further, the systems currently used for transmission and approval of payment cardtransactions, and the technology utilized in payment cards themselves, all of which can put payment card data at risk, are determined and controlled by the paymentcard industry, not us. Although we have taken steps designed to safeguard our customers' confidential personal information and important internal company data,our network and other systems and those of third parties, such as service providers, could be compromised, damaged, or disrupted by a third party breach of oursystem security or that of a third-party provider or as a result of purposeful or accidental actions of third parties, our employees or those employees of a third party,power outages, computer viruses, system failures, natural disasters or other catastrophic events. Our third-party information system service providers face risksrelating to cybersecurity similar to ours, and we do not directly control any of such parties’ information security operations. Advances in computer and softwarecapabilities and encryption technology, new tools and other developments may increase the risk of a security breach. As a result of any security breach, customerinformation or other proprietary data may be accessed or transmitted by or to a third party. Despite these measures, there can be no assurance that we areadequately protecting our information.Any loss, disclosure or misappropriation of, or access to, customers' or other proprietary information, or other breach of our information security could result inlegal claims or legal proceedings, including regulatory investigations and actions, or liability for failure to comply with privacy and information security laws,including for failure to protect personal information or for misusing personal information, which could disrupt our operations, damage our reputation and expose usto claims from customers,23financial institutions, regulators, payment card associations, employees and other persons, any of which could have an adverse effect on our financial condition,results of operations and cash flow.Our obligation to contribute to multi-employer pension plans, or discontinuance of such obligations, may have an adverse impact on us.We contribute to and participate in various multi-employer pension plans for employees represented by certain unions. We are required to make contributions tothese plans in amounts established under collective bargaining agreements. We do not administer these plans and, generally, are not represented on the boards oftrustees of these plans. The Pension Protection Act enacted in 2006, or the PPA, requires under-funded pension plans to improve their funding ratios. Based on theinformation available to us, some of the multi-employer plans to which we contribute are either “critical” or “endangered” as those terms are defined in the PPA.Specifically, the Pension Plan of the UNITE HERE National Retirement Fund is less than 65% funded. We cannot determine at this time the amount of additionalfunding, if any, we may be required to make to these plans. However, plan assessments could have an adverse impact on our results of operations or cash flows fora given period. Furthermore, under current law, upon the termination of a multi-employer pension plan, due to the withdrawal of all its contributing employers (amass withdrawal), or in the event of a withdrawal by us, which we consider from time to time, we would be required to make payments to the plan for ourproportionate share of the plan's unfunded vested liabilities, that would have a material adverse impact on our consolidated financial condition, results ofoperations and cash flows.In January 2015, the Trustees of the National Retirement Fund (“NRF”), a multi-employer defined benefit pension plan, voted to expel the CEC controlled group(“CEC Group”) from NRF’s Legacy Plan. NRF claims that CEOC’s bankruptcy presents an “actuarial risk” to the Legacy Plan purportedly permitting suchexpulsion. The CEC affiliates that are included in the NRF Legacy Plan are Caesars Atlantic City, Bally’s Atlantic City, and Harrah’s Philadelphia (all of whichare owned by CEOC and are not included in CEC’s results), as well as Harrah’s Atlantic City and the Las Vegas laundry. NRF has advised the CEC Group that itsexpulsion has triggered withdrawal liability with a present value of approximately $360 million , payable in 80 quarterly payments of about $6 million , and hascommenced litigation against CEC and CERP seeking payment of this withdrawal liability, which remains ongoing.The CEC Group disputes NRF’s authority to take such action. Prior to NRF’s vote, the CEC Group reiterated its commitment to remain in the plan and not seekrejection of any collective bargaining agreement in which the obligation to contribute to NRF exists. CEOC is current with respect to pension contributions. TheCEC Group is pursuing several litigation strategies to challenge NRF’s action, and CEC and CERP are vigorously opposing the litigation commenced by NRF.There can be no assurance that our strategies will have a successful outcome, and the CEC Group may become liable for the withdrawal liability, which wouldhave an adverse impact on us.Due to the participation of CEOC, CGPH, and CERP in CES, we may not control CES and our interests may not align with the interests of the other membersof CES.CEOC, CGPH, and CERP are members of CES, and each relies on CES to provide it and its subsidiaries with intellectual property licenses and propertymanagement services, among other services. CEOC, CGPH and CERP are each required to contribute as necessary to fund CES’ operating costs and capitalrequirements in proportion to their respective ownership interest in CES. The members of CES are required to fund its capital expenditures in agreed portions on anannual basis. The amount each member will be required to fund in future years will be subject to the review and approval of the CES steering committee. CEOC,CGPH and CERP, together, control CES through the CES steering committee, which is comprised of one representative from each of CEOC, CGPH and CERP.Conflicts of interest may arise between Caesars Entertainments’ subsidiaries. Most decisions by CES require the consent of two of the three steering committeemembers. To the extent we are unable to control the consent of at least two of the three steering committee members, we may be unable to cause CES to takeactions that our in our interest. In addition, certain decisions by CES may not be made without unanimous consent of the members. These actions include anydecision with respect to liquidation or dissolution of CES, merger, consolidation or sale of all or substantially all the assets of CES, usage of CES assets in amanner inconsistent with the purposes of CES, material amendment to CES’ operating agreement, admission of new investors to CES and filing of any bankruptcyor similar action by CES. Thus, the members may block certain actions by CES that are in our interest.24We are controlled by the Sponsors, whose interests may not be aligned with ours.The members of Hamlet Holdings LLC (“Hamlet Holdings”) are comprised of individuals affiliated with Apollo Global Management, LLC (“Apollo”) andaffiliates of TPG Capital LP (“TPG”) (collectively, the “Sponsors”). As of December 31, 2016 , Hamlet Holdings beneficially owned a majority of our commonstock pursuant to an irrevocable proxy providing Hamlet Holdings with sole voting and sole dispositive power over those shares, and, as a result, the Sponsors havethe power to elect all of our directors. Moreover, Hamlet Holdings has the ability to vote on any transaction that requires the approval of our board of directors orour stockholders, including the approval of significant corporate transactions such as mergers and the sale of all or substantially all of our assets. As a result,Hamlet Holdings is in a position to exert a significant influence over us, and the direction of our business and results of operations. The interests of the Sponsorscould conflict with or differ from the interests of other holders of our securities. For example, the concentration of ownership held by the Sponsors could delay,defer or prevent a change of control of us or impede a merger, takeover or other business combination which another stockholder may otherwise view favorably.Additionally, the Sponsors are in the business of making or advising on investments in companies they hold, and may from time to time in the future acquireinterests in or provide advice to businesses that directly or indirectly compete with certain portions of our business or are suppliers or customers of ours. One orboth of the Sponsors may also pursue acquisitions that may be complementary to our business, and, as a result, those acquisition opportunities may not be availableto us. A sale of a substantial number of shares of stock in the future by funds affiliated with the Sponsors or their co-investors could cause our stock price todecline. So long as Hamlet Holdings continues to hold the irrevocable proxy, they will continue to be able to strongly influence or effectively control our decisions.In addition, we have an executive committee that serves at the discretion of our board of directors and is authorized to take such actions as it reasonably determinesappropriate. Currently, the executive committee may act by a majority of its members, provided that at least one member affiliated with TPG and Apollo mustapprove any action of the executive committee.Future sales or the possibility of future sales of a substantial amount of our common stock, including in connection with the Merger or the restructuring ofCEOC, may depress the price of shares of our common stock.Future sales or the availability for sale of substantial amounts of our common stock in the public market could adversely affect the prevailing market price of ourcommon stock and could impair our ability to raise capital through future sales of equity securities.As of December 31, 2016 , there were 147 million shares outstanding, all of which are the same class of voting common stock. All of the outstanding shares of ourcommon stock will be eligible for resale under Rule 144 or Rule 701 of the Securities Act of 1933, as amended (“Securities Act”), subject to volume limitations,applicable holding period requirements or other contractual restrictions. The Sponsors have the ability to cause us to register the resale of its shares, and ourmanagement members who hold shares will have the ability to include their shares in such registration.We sold 7 million shares of our common stock in 2014. In connection with the Merger, we expect to issue a significant number of shares of our common stock and,in connection with the Third Amended Plan, we expect to issue a significant number of shares of our common stock and a significant amount of notes that will beconvertible into shares of our common stock. In addition, we may issue shares of common stock or other securities from time to time as consideration for futureacquisitions and investments or for any other reason that our board of directors deems advisable. If any such acquisition or investment is significant, the number ofshares of our common stock, or the number or aggregate principal amount, as the case may be, of other securities that we may issue may in turn be substantial. Wemay also grant registration rights covering those shares of common stock or other securities in connection with any such acquisitions and investments.We cannot predict the size of future issuances of our common stock or other securities or the effect, if any, that future issuances and sales of our common stock orother securities, including future sales by the Sponsors, will have on the market price of our common stock. Sales of substantial amounts of common stock(including shares of common stock issued in connection with an acquisition), or the perception that such sales could occur, may adversely affect prevailing marketprices for our common stock.The price and trading volume of our common stock may fluctuate significantly.The market price of our common stock may be highly volatile and could be subject to wide fluctuations. In addition, the trading volume of our common stock mayfluctuate and cause significant price variations to occur. Volatility in the market price of our common stock may prevent a holder of our common stock from beingable to sell their shares. The market price for our common stock could fluctuate significantly for various reasons, including:•our operating and financial performance and prospects;•our quarterly or annual earnings or those of other companies in our industry;25•news or developments related to CEOC's ongoing Bankruptcy proceedings and negotiations with its creditors;•conditions that impact demand for our products and services;•the public's reaction to our press releases, other public announcements and filings with the SEC;•changes in earnings estimates or recommendations by securities analysts who track our common stock;•market and industry perception of our success, or lack thereof, in pursuing our growth strategy;•strategic actions by us or our competitors, such as acquisitions or restructurings;•changes in government and environmental regulation, including gaming taxes;•changes in accounting standards, policies, guidance, interpretations or principles;•arrival and departure of key personnel;•changes in our capital structure;•sales of common stock by us or members of our management team;•issuance of common stock in connection with the Merger;•the expiration of contractual lockup agreements; and•changes in general market, economic and political conditions in the United States and global economies or financial markets, including those resultingfrom natural disasters, terrorist attacks, acts of war and responses to such events.In addition, the stock market experiences significant price and volume fluctuations. This volatility has had a significant impact on the market price of securitiesissued by many companies, including companies in the gaming, lodging, hospitality and entertainment industries. The changes frequently appear to occur withoutregard to the operating performance of the affected companies. Hence, the price of our common stock could fluctuate based upon factors that have little or nothingto do with us, and these fluctuations could materially reduce our share price.Because we have not paid dividends since being acquired by the Sponsors in 2008 and do not anticipate paying dividends on our common stock in theforeseeable future, holders of our common stock should not expect to receive dividends on shares of our common stock.We have no present plans to pay cash dividends to our stockholders and, for the foreseeable future, intend to retain all of our earnings for use in our business. Thedeclaration of any future dividends by us is within the discretion of our Board and will be dependent on our earnings, financial condition and capital requirements,as well as any other factors deemed relevant by our board of directors.We are a “controlled company” within the meaning of the NASDAQ rules and, as a result, will qualify for, and intend to rely on, exemptions from certaincorporate governance requirements.Hamlet Holdings currently controls a majority of our voting common stock. As a result, we are a “controlled company” within the meaning of NASDAQ corporategovernance standards. Under the NASDAQ rules, a company of which more than 50% of the voting power is held by an individual, group or another company is a“controlled company” and we have elected not to comply with certain NASDAQ corporate governance requirements, including:•a majority of the board of directors consists of independent directors;•a nominating/corporate governance committee that is composed entirely of independent directors;•a compensation committee that is composed entirely of independent directors; and•an annual performance evaluation of the nominating/corporate governance and compensation committees.26As a result of these exemptions, we do not have a majority of independent directors nor do our nominating/corporate governance and compensation committeesconsist entirely of independent directors and we are not required to have an annual performance evaluation of the nominating/corporate governance andcompensation committees. Accordingly, a holder of our common stock will not have the same protections afforded to stockholders of companies that are subject toall of the NASDAQ corporate governance requirements.Our bylaws and certificate of incorporation contain provisions that could discourage another company from acquiring us and may prevent attempts by ourstockholders to replace or remove our current management.Provisions of our bylaws and our certificate of incorporation may delay or prevent a merger or acquisition that stockholders may consider favorable, includingtransactions in which you might otherwise receive a premium for your shares. In addition, these provisions may frustrate or prevent any attempts by ourstockholders to replace or remove our current management by making it more difficult for stockholders to replace or remove our directors. These provisionsinclude:•establishing a classified board of directors;•establishing limitations on the removal of directors;•permitting only an affirmative vote of at least two-thirds of the Board to fix the number of directors;•prohibiting cumulative voting in the election of directors;•empowering only the board of directors to fill any vacancy on the board of directors, whether such vacancy occurs as a result of an increase in the numberof directors or otherwise;•authorizing the issuance of “blank check” preferred stock without any need for action by stockholders;•eliminating the ability of stockholders to call special meetings of stockholders;•prohibiting stockholders from acting by written consent if less than 50.1% of our outstanding common stock is controlled by the Sponsors;•prohibiting amendments to the bylaws without the affirmative vote of at least two-thirds of the board of directors or the affirmative vote of at least two-thirds of the total voting power of the outstanding shares entitled to vote;•prohibiting amendments to the certificate of incorporation relating to stockholder meetings, amendments to the bylaws or certificate of incorporation, orthe election or classification of the board of directors without the affirmative vote of two-thirds of the shares entitled to vote on any matter; and•establishing advance notice requirements for nominations for election to the board of directors or for proposing matters that can be acted on bystockholders at stockholder meetings.Our issuance of shares of preferred stock could delay or prevent a change of control of us. Our board of directors has the authority to cause us to issue, without anyfurther vote or action by the stockholders, shares of preferred stock, par value $0.01 per share, in one or more series, to designate the number of shares constitutingany series, and to fix the rights, preferences, privileges and restrictions thereof, including dividend rights, voting rights, rights and terms of redemption, redemptionprice or prices and liquidation preferences of such series. The issuance of shares of preferred stock may have the effect of delaying, deferring or preventing achange in control of our company without further action by the stockholders, even where stockholders are offered a premium for their shares.Together, these charter and statutory provisions could make the removal of management more difficult and may discourage transactions that otherwise couldinvolve payment of a premium over prevailing market prices for our common stock. Furthermore, the existence of the foregoing provisions, as well as thesignificant common stock controlled by Hamlet Holdings, could limit the price that investors might be willing to pay in the future for shares of our common stock.They could also deter potential acquirers of our company, thereby reducing the likelihood that you could receive a premium for your common stock in anacquisition.27PRIVATE SECURITIES LITIGATION REFORM ACTThis Form 10-K contains or may contain “forward-looking statements” intended to qualify for the safe harbor from liability established by the Private SecuritiesLitigation Reform Act of 1995. These statements can be identified by the fact that they do not relate strictly to historical or current facts. We have based theseforward-looking statements on our current expectations about future events. Further, statements that include words such as “may,” “will,” “project,” “might,”“expect,” “believe,” “anticipate,” “intend,” “could,” “would,” “estimate,” “continue,” “present,” “preserve,” or “pursue,” or the negative of these words or otherwords or expressions of similar meaning may identify forward-looking statements. These forward-looking statements are found at various places throughout thisreport. These forward-looking statements, including, without limitation, those relating to future actions, new projects, strategies, future performance, the outcomeof contingencies such as legal proceedings, the restructuring of CEOC and future financial results, wherever they occur in this report, are necessarily estimatesreflecting the best judgment of our management and involve a number of risks and uncertainties that could cause actual results to differ materially from thosesuggested by the forward-looking statements. These forward-looking statements should, therefore, be considered in light of various important factors set forthabove and from time to time in our filings with the Securities and Exchange Commission.In addition to the risk factors set forth above, important factors that could cause actual results to differ materially from estimates or projections contained in theforward-looking statements include without limitation:•the outcome of currently pending or threatened litigation and demands for payment by certain creditors and by the NRF against CEC;•the effects of CEOC’s bankruptcy on CEOC and its subsidiaries and affiliates, including Caesars Entertainment, and the interest of various creditors,equity holders and other constituents;•the ability to retain key employees during the restructuring of CEOC;•risks associated with third party motions in the Chapter 11 Case, which may hinder or delay CEOC's ability to consummate the Third Amended Plan;•the ability (or inability) of CEC and CEOC to satisfy the conditions to the effectiveness of the Third Amended Plan;•adverse effects of the Chapter 11 proceedings and related litigation on Caesars Entertainment’s liquidity or results of operations;•the effects of local and national economic, credit and capital market conditions on the economy, in general, and on the gaming industry, in particular;•the financial results of our consolidated businesses;•the impact of our substantial indebtedness and the restrictions in our debt agreements;•access to available and reasonable financing on a timely basis, including the ability of the Company to refinance its indebtedness on acceptable terms;•the ability of our customer tracking, customer loyalty, and yield management programs to continue to increase customer loyalty and same-store or hotelsales;•changes in laws, including increased tax rates, smoking bans, regulations or accounting standards, third-party relations and approvals, and decisions,disciplines and fines of courts, regulators and governmental bodies;•our ability to recoup costs of capital investments through higher revenues;•abnormal gaming holds (“gaming hold” is the amount of money that is retained by the casino from wagers by customers);•the effects of competition, including locations of competitors, competition for new licenses, and operating and market competition;•the ability to timely and cost-effectively integrate companies that we acquire into our operations;•the potential difficulties in employee retention and recruitment as a result of our substantial indebtedness or any other factor;28•construction factors, including delays, increased costs of labor and materials, availability of labor and materials, zoning issues, environmental restrictions,soil and water conditions, weather and other hazards, site access matters, and building permit issues;•litigation outcomes and judicial and governmental body actions, including gaming legislative action, referenda, regulatory disciplinary actions, and finesand taxation;•acts of war or terrorist incidents, severe weather conditions, uprisings or natural disasters, including losses therefrom, losses in revenues and damage toproperty, and the impact of severe weather conditions on our ability to attract customers to certain of our facilities;•the effects of environmental and structural building conditions relating to our properties;•access to insurance on reasonable terms for our assets; and•the impact, if any, of unfunded pension benefits under multi-employer pension plans.You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this Annual Report on Form 10-K. Weundertake no obligation to publicly update or release any revisions to these forward-looking statements to reflect events or circumstances after the date of thisForm 10-K or to reflect the occurrence of unanticipated events, except as required by law.ITEM 1B.Unresolved Staff CommentsNone.29ITEM 2.PropertiesAs of December 31, 2016 , we owned the following casino properties. All amounts are approximations.PropertyLocationCasinoSpace–Sq. Ft. SlotMachines TableGames Hotel Rooms and Suites Bally’s Las VegasLas Vegas, NV68,400 990 70 2,810The CromwellLas Vegas, NV40,000 390 50 190Flamingo Las VegasLas Vegas, NV72,300 1,090 110 3,460Harrah’s Atlantic CityAtlantic City, NJ155,200 2,180 180 2,590Harrah’s Las VegasLas Vegas, NV90,600 1,250 90 2,530Harrah’s LaughlinLaughlin, NV56,000 910 40 1,510Harrah’s New OrleansNew Orleans, LA125,100 1,580 150 450Horseshoe BaltimoreBaltimore, MD122,000 2,200 180 —The LINQ Hotel & CasinoLas Vegas, NV31,900 760 70 2,250Paris Las VegasLas Vegas, NV95,300 1,020 100 2,920Planet Hollywood Resort & CasinoLas Vegas, NV64,500 1,080 100 2,500Rio All-Suites Hotel & CasinoLas Vegas, NV117,300 1,060 70 2,520 30ITEM 3.Legal ProceedingsWe are subject to a number of Noteholder Disputes, all of which are currently stayed consensually or by order of the Bankruptcy Court, related to varioustransactions that CEOC has completed since 2010, as well as certain other litigation. See Note 3 for fu ll details of the matters outlined below.Noteholder Disputes•Litigation commenced by Wilmington Savings Fund Society, FSB on August 4, 2014 (the “Delaware Second Lien Lawsuit”)•Litigation commenced by parties on September 3, 2014 and October 2, 2014 (the “Senior Unsecured Lawsuits”)•Litigation commenced by UMB Bank on November 25, 2014 (the “Delaware First Lien Lawsuit”)•Demands for payment made by Wilmington Savings Fund Society, FSB on February 13, 2015 (the “February 13 Notice”)•Demands for payment made by BOKF, N.A., on February 18, 2015 (the “February 18 Notice”)•Litigation commenced by BOKF, N.A. on March 3, 2015 (the “New York Second Lien Lawsuit”)•Litigation commenced by UMB Bank on June 15, 2015 (the “New York First Lien Lawsuit”)•Litigation commenced by Wilmington Trust, National Association on October 20, 2015 (the “New York Senior Notes Lawsuit”)Other LitigationLitigation commenced by Nicholas Koskie on December 30, 2014 (the “Merger Lawsuit”)Litigation commenced by Hilton on December 24, 2014 (the “Hilton Lawsuit”)Litigation commenced by Trustees of the National Retirement Fund in January 2015 (“NRF Litigation”)ITEM 4.Mine Safety DisclosuresNot applicable.31PART IIITEM 5.Market for the Company’s Common Equity, Related Stockholder Matters and Issuer Purchases of EquitySecuritiesOur common stock trades on the NASDAQ under the ticker symbol “CZR.” The following table sets forth the high and low sales prices for our common stock onthe NASDAQ for each quarter during 2016 and 2015 . 2016 2015 High Low High LowFirst Quarter$9.64 $5.65 $16.00 $8.78Second Quarter8.86 6.24 12.48 5.95Third Quarter10.84 5.39 10.61 3.30Fourth Quarter8.50 6.70 9.17 5.75As of February 1, 2017 , there were 147,184,937 shares of common stock issued and outstanding that were held by 121 stockholders of record.To date, we have not paid a cash dividend. Certain of our borrowings have covenants and requirements restricting or limiting the ability of CEC and its subsidiariesto, among other things, pay dividends on or make distributions in respect of their capital stock or make other restricted payments. See Note 11 for additionalinformation on our covenants and restrictions.There have not been any sales by CEC of equity securities during the years ended December 31, 2016 , 2015 , or 2014 , that have not been registered under theSecurities Act. In addition, CEC did not repurchase shares of its common stock during the three months ended December 31, 2016 .Performance GraphThe graph depicted below compares the cumulative total stockholder return on our common stock with the cumulative total return on the Standard & Poor's 500Stock Index (“S&P 500”) and the Dow Jones U.S. Gambling Total Stock Market Index (“Dow Jones U.S. Gambling”) for the period beginning on February 8,2012 (the date our common stock commenced trading on the NASDAQ Global Select Market) and ending on December 31, 2016 . NASDAQ OMX furnished thedata. The performance graph assumes a $100 investment in our stock and each of the two indices, respectively, on February 8, 2012, and that all dividends werereinvested. Stock price performance, presented for the period from February 8, 2012 to December 31, 2016 , is not necessarily indicative of future results.32 As of December 31, 2/8/2012 2012 2013 2014 2015 2016CZR$100.00 $44.96 $139.96 $101.95 $51.27 $55.23S&P 500 Index100.00 107.85 142.78 162.33 164.57 184.26Dow Jones U.S. Gambling100.00 98.69 168.43 139.72 116.41 147.66The performance graph should not be deemed filed or incorporated by reference into any other of our filings under the Securities Act or the Exchange Act, unlesswe specifically incorporate the performance graph by reference therein.Equity Compensation Plan InformationWe maintain various long-term incentive plans for management, other personnel, and key service providers. The plans allow for granting stock-basedcompensation awards, including time-based and performance-based stock options, restricted stock units, restricted stock awards, stock grants, or a combination ofawards. See Note 14 for a description of our stock-based compensation plans.Equity compensation plans approved by securityholders Number of securities to be issued upon exercise of outstanding options or vesting of restricted stock units Weighted-average exercise price of outstanding options Number of securities remaining available for future issuance under equity compensation plans (2)Stock options (1) 9,820,168 $11.69 8,331,449Restricted stock units 8,447,922 N/A N/A____________________(1) The weighted average remaining contractual life for the options set forth in this row is 6.2 years.(2) Under the 2012 Incentive Plan, the type and form of awards that can be granted includes, but is not limited to, stock options, stock appreciation rights, restricted stock awards, andrestricted stock units.33ITEM 6.Selected Financial DataThe following selected financial data should be read in conjunction with the consolidated financial statements and Item 7, “Management’s Discussion and Analysisof Financial Condition and Results of Operations,” of this Form 10-K.(In millions, except per share data)2016 2015 (1) 2014 2013 2012OPERATING DATA Net revenues$3,877 $3,929 $7,967 $7,917 $7,994Impairment of goodwill— — 695 104 195Impairment of tangible and other intangible assets (2)— 1 299 2,727 430Income/(loss) from operations257 346 (555) (2,047) 72Interest expense599 683 2,669 2,252 2,100Deconsolidation and restructuring of CEOC and other (3)(5,758) 6,115 (95) 28 161Income/(loss) from continuing operations, net of income taxes(6,127) 5,897 (2,723) (2,748) (1,150)Discontinued operations, net of income taxes (4)3,380 155 (143) (192) (353)Net income/(loss)(2,747) 6,052 (2,866) (2,940) (1,503)Net income/(loss) attributable to Caesars(3,569) 5,920 (2,783) (2,948) (1,508)COMMON STOCK DATA Basic earnings/(loss) per share from: Continuing operations$(47.52) $39.80 $(18.53) $(21.43) $(9.22)Discontinued operations (4)23.11 1.08 (1.00) (1.50) (2.82)Net income/(loss)$(24.41) $40.88 $(19.53) $(22.93) $(12.04)Diluted earnings/(loss) per share from: Continuing operations$(47.52) $39.20 $(18.53) $(21.43) $(9.22)Discontinued operations (4)23.11 1.06 (1.00) (1.50) (2.82)Net income/(loss)$(24.41) $40.26 $(19.53) $(22.93) $(12.04) FINANCIAL POSITION DATA Total assets$14,894 $12,206 $23,339 $24,492 $27,670Current portion of long-term debt89 187 15,779 197 880Long-term debt (5)6,749 6,777 7,230 20,715 20,305Noncontrolling interests (6)1,759 1,246 255 1,218 80Stockholders’ equity/(deficit)(3,177) 987 (4,997) (3,122) (412)____________________(1) 2015 reflects the deconsolidation of CEOC (see Note 2 ).(2) See Note 6 and Note 7 for information about impairments.(3) See Note 1 .(4) See Note 17 .(5) See Note 11 for information about debt.(6) The decrease in 2014 was primarily due to the sale and grant of CEOC shares in May 2014, which reduced CEC’s ownership to approximately 89%. The increase in 2013 was primarilydue to the formation of CGP (see Note 2 ).34ITEM 7.Management’s Discussion and Analysis of Financial Condition and Results of OperationsIn this filing, the name “CEC” refers to the parent holding company, Caesars Entertainment Corporation, exclusive of its consolidated subsidiaries and variableinterest entities, unless otherwise stated or the context otherwise requires. The words “Company,” “Caesars,” “Caesars Entertainment,” “we,” “our,” and “us”refer to Caesars Entertainment Corporation, inclusive of its consolidated subsidiaries and variable interest entities, unless otherwise stated or the contextotherwise requires.We also refer to (i) our Consolidated Financial Statements as our “Financial Statements,” (ii) our Consolidated Statements of Operations and ComprehensiveIncome as our “Statements of Operations,” and (iii) our Consolidated Balance Sheets as our “Balance Sheets.” Note references are to the notes to consolidatedfinancial statements included in Item 8.The following discussion should be read in conjunction with, and is qualified in its entirety by, the audited consolidated financial statements and the notes theretoand other financial information included elsewhere in this Form 10-K.The statements in this discussion regarding our expectations regarding our future performance, liquidity and capital resources, and other non-historical statementsare forward-looking statements. These forward-looking statements are subject to numerous risks and uncertainties. Our actual results may differ materially fromthose contained in or implied by any forward-looking statements. See Item 1A, “Risk Factors—PRIVATE SECURITIES LITIGATION REFORM ACT” of thisreport.OverviewOur business is operated through CEC, which is primarily a holding company with no independent operations of its own, and our two reportable segments.Through June 30, 2016, we aggregated the operating segments within Caesars Growth Partners (“CGP”) into two separate reportable segments: Caesars GrowthPartners Casino Properties and Developments (“CGP Casinos”) and Caesars Interactive Entertainment (“CIE”). Subsequent to CIE’s sale of its social and mobilegames business (the “SMG Business”) (see discussion under “Summary of 2016 Events” below), the remaining CIE business is not material, and we no longerconsider CIE to be a separate reportable segment from CGP Casinos. Therefore, CGP Casinos and CIE have been combined for all periods presented to form theCGP segment. In addition, we deconsolidated Caesars Entertainment Operating Company (“CEOC”) from our results following its bankruptcy filing in January2015, and therefore CEOC is not included in our financial results for the majority of 2015 and all of 2016, and is no longer a reportable segment. The CaesarsEntertainment Resort Properties (“CERP”) and CGP segments include the following properties: (1) CERP (2) CGP Flamingo Las Vegas Bally’s Las VegasHarrah’s Atlantic City The CromwellHarrah’s Las Vegas Harrah’s New OrleansHarrah’s Laughlin Horseshoe BaltimoreParis Las Vegas The LINQ Hotel & CasinoRio All-Suites Hotel & Casino Planet Hollywood Resort & Casino CIE Real-Money Online Gaming CIE World Series of Poker___________________(1) CEOC remained a reportable segment until its deconsolidation effective January 15, 2015 (see Note 2 ).(2) CERP also owns The LINQ promenade and Octavius Tower at Caesars Palace Las Vegas (“Octavius Tower”).35Summary of 2016 Events and Key Drivers of Annual PerformanceThe following are the significant events of 2016 and the key drivers of our performance. Accordingly, these key drivers are described here, and the remainder ofthe discussion and analysis of results should be read in conjunction with these explanations.CEC Going ConcernAs a result of the following circumstances, we have substantial doubt about CEC’s ability to continue as a going concern:•we have limited unrestricted cash available to meet the financial commitments of CEC, primarily resulting from significant expenditures made to (1)defend against the litigation matters disclosed below and (2) support a plan of reorganization for CEOC (the “Restructuring”);•we have made material future commitments to support the Restructuring described below; and•we are a defendant in litigation relating to certain CEOC transactions dating back to 2010 and other legal matters (see Note 3 ) that could result in one ormore adverse rulings against us if the Restructuring is not completed.In connection with the Restructuring and litigation noted above, during 2016 and 2015, CEC has incurred legal and professional fees and expenses at levelssignificantly higher than historical amounts. For example, as of December 31, 2016, we have accrued $6.6 billion of restructuring and support expenses, and during2016 and 2015, we incurred $70 million and $73 million , respectively, in legal and professional fees associated with reorganization efforts and ongoing litigation.We expect to continue to incur additional expenses until CEOC’s successful emergence from bankruptcy.The circumstances set forth above and described in more detail in Note 1 , individually and collectively, raise substantial doubt about CEC’s ability to continue as agoing concern between now and the Effective Date of the Restructuring. CEC does not currently have sufficient cash to meet its financial commitments to supportthe Third Amended Plan or to satisfy the potential obligations that would arise in the event of an adverse ruling on one or all of the litigation matters disclosedbelow. The completion of the merger with Caesars Acquisition Company (“CAC”) is expected to allow CEC to fulfill its financial commitments in support of theRestructuring. However, if the Merger is not completed for any reason, CEC would still be liable for many of these obligations. In addition, although under theterms of the Restructuring, all related litigation is expected to be resolved, there remain the outstanding litigation matters that are currently stayed pending CEOC’semergence from bankruptcy.CEC entered into the CIE Proceeds and Reservation Rights Agreement (as amended on October 7, 2016) with CIE, CEOC and CAC (the “CIE ProceedsAgreement”), which allows for up to $235 million of the proceeds from the SMG Business sale to be distributed to CEC in order to pay certain fees in support ofthe Restructuring (“CEC Expense Amounts”). After taking into account the cash available to pay the CEC Expense Amounts under the CIE Proceeds Agreementand other sources of liquidity, CEC expects to have sufficient cash to meet its ongoing obligations as they come due for at least 12 months beyond the issuancedate of these financial statements. However, there are restrictions governing when and how the cash designated for CEC Expense Amounts can be used (see Note 2). CEC also expects to gain access to the remaining proceeds from the sale of the SMG Business upon completion of the Merger, which will be used to fund itsother commitments in support of the Restructuring.If CEC is unable to access additional sources of cash when needed, in the event of a material adverse ruling on one or all of the litigation matters disclosed below,or if CEOC does not emerge from bankruptcy on a timely basis on terms and under circumstances satisfactory to CEC, it is likely that CEC would seekreorganization under Chapter 11 of the Bankruptcy Code.CEOC ReorganizationOn January 13, 2017 , the Debtors filed an amended plan of reorganization (the “Third Amended Plan”) with the United States Bankruptcy Court for the NorthernDistrict of Illinois in Chicago (the “Bankruptcy Court”) that replaces all previously filed plans. CEC, CAC, the Debtors and CEOC’s major creditor groups haveagreed to support the Third Amended Plan. The Bankruptcy Court confirmed the Third Amended Plan on January 17, 2017 .As part of the Third Amended Plan, it is anticipated that CEOC will be divided into two companies - OpCo and PropCo. OpCo will operate CEOC’s properties andfacilities. PropCo will hold certain of CEOC’s real property assets and related fixtures and will lease those assets to OpCo. It is anticipated that OpCo will be awholly owned consolidated subsidiary of CEC subsequent to the CEOC’s emergence, and that will contract with another subsidiary of CEC to manage the facilitiesto be leased from PropCo.Although the Third Amended Plan has been confirmed by the Bankruptcy Court, we must still obtain regulatory approval in all of the jurisdictions in which wehave gaming operations in order for CEOC to successfully emerge from bankruptcy, and we are36unable to determine when all necessary requirements will be satisfied. In addition, the Third Amended Plan remains subject to completion of the merger with CAC,certain financing transactions, and various other closing conditions.CIE’s Sale of the SMG BusinessOn September 23, 2016 , CIE sold the SMG Business for cash consideration of $4.4 billion , subject to customary purchase price adjustments, and retained only itsWorld Series of Poker and regulated online real money gaming businesses. This resulted in a pre-tax gain of approximately $4.2 billion . The SMG Businessrepresented the majority of CIE’s operations and was classified as discontinued operations for the year ended December 31, 2016 . Historical results of the SMGBusiness have been recast as discontinued operations for the years ended December 31, 2015 and 2014 , and the related assets and liabilities have been recast asheld for sale as of December 31, 2015 (see “Discontinued Operations” in the Discussion of Operating Results section below and Note 17 ).Upon closing the sale of the SMG Business, all outstanding CIE stock-based compensation awards were deemed fully vested and subsequently canceled in returnfor the right to receive a cash payment. CIE’s stock-based compensation expense directly identifiable with employees of the SMG Business was $264 million , $29million , and $38 million during the years ended December 31, 2016 , 2015 , and 2014 , respectively. These expense amounts were reclassified to discontinuedoperations for all periods presented in the Statements of Operations. Stock-based compensation expense not directly identifiable with employees of the SMGBusiness was $189 million , $31 million , and $49 million during the years ended December 31, 2016 , 2015 , and 2014 , respectively, and was included inproperty, general, administrative, and other in the Statements of Operations. For the year ended December 31, 2016, the majority of stock-based compensationexpense resulted from the acceleration of the vesting of CIE stock-based compensation awards.Discussion of Operating ResultsAs described above and in Note 1 , we deconsolidated CEOC effective January 15, 2015. Headings below labeled “CERP and CGP” represent the combined resultsof the entities that remain in the consolidated Caesars entity subsequent to the deconsolidation of CEOC, and do not include the results of CEOC or the SMGBusiness. Where we have presented an analysis of other factors affecting net income/(loss) and consolidated results by reportable segment, this informationincludes CEOC as a reportable segment for the first 15 days of 2015.Segment results in this MD&A are presented consistent with the way Caesars management assesses the results subsequent to the deconsolidation of CEOC, whichis a consolidated view that adjusts for the impact of certain transactions between reportable segments within Caesars for all periods presented. Therefore, theresults of certain reportable segments presented in this filing differ from the financial statement information presented in their separate filings. “Other” includesparent, consolidating, and other adjustments to reconcile to consolidated Caesars results.Consolidated Operating Results Years Ended December 31, 2016 2015 (A) (B) (A) vs. (B) CERP andCGP (1)CERP andCGP (1)CEOC (2)ConsolidatedCaesars Fav/(Unfav)(Dollars in millions) $ %Casino revenues$2,177 $2,168 $118 $2,286 $9 0.4 %Net revenues3,877 3,771 158 3,929 106 2.8 %Income from operations257 337 9 346 (80) (23.7)%Deconsolidation and restructuring of CEOC and other(5,758) 6,115 — 6,115 (11,873) *Income/(loss) from continuing operations, net of income taxes(6,127) 5,975 (78) 5,897 (12,102) *Discontinued operations, net of income taxes3,380 162 (7) 155 3,218 *Net income/(loss) attributable to Caesars(3,569) 6,005 (85) 5,920 (9,574) *Property EBITDA (3)1,140 1,047 31 1,078 93 8.9 %Operating Margin (4)6.6% 8.9% 5.7% 8.8% — (2.3) pts37 Year Ended December 31, 2014 (C) (B) vs. (C) CERP and CGP (1)CEOC (2)ConsolidatedCaesarsFav/(Unfav)(Dollars in millions)$ %Casino revenues$1,923 $3,495 $5,418 $245 12.7%Net revenues3,372 4,595 7,967 399 11.8%Loss from operations(245) (310) (555) 582 *Deconsolidation and restructuring of CEOC and other142 (237) (95) 5,973 *Loss from continuing operations, net of income taxes(382) (2,341) (2,723) 6,357 *Discontinued operations, net of income taxes34 (177) (143) 128 *Net loss attributable to Caesars(429) (2,354) (2,783) 6,434 *Property EBITDA (3)755 826 1,581 292 38.7%Operating Margin (4)(7.3)% (6.7)% (7.0)% — 16.2 pts___________________*Not meaningful.(1) Includes CERP and CGP segments and associated parent company and elimination adjustments.(2) Includes CEOC segment and associated eliminations of intercompany transactions and other consolidating adjustments.(3) See the “Reconciliation of Non-GAAP Financial Measures” section below.(4) Calculated as income/(loss) from operations divided by net revenues.Casino revenues, net revenues, income/(loss) from operations, and income/(loss) from continuing operations, net of income taxes for all periods presented in thetable above exclude the results of our discontinued operations disclosed in Note 17 .Analysis of Key Drivers of Revenue Performance for CERP and CGPNet Revenues - by Category Years Ended December 31, 2016 vs. 2015 2015 vs. 2014 Fav/(Unfav) Fav/(Unfav)(Dollars in millions)2016 2015 2014 $ % $ %Casino$2,177 $2,168 $1,923 $9 0.4 % $245 12.7%Food and beverage788 798 760 (10) (1.3)% 38 5.0%Rooms923 860 753 63 7.3 % 107 14.2%Other527 487 479 40 8.2 % 8 1.7%Less: casino promotional allowances(538) (542) (543) 4 0.7 % 1 0.2%Net revenues$3,877 $3,771 $3,372 $106 2.8 % $399 11.8%38Increase/(Decrease) in Net Revenues by CategoryYears Ended December 31, 2014 through December 31, 2016Net Revenues - Segment Years Ended December 31, 2016 vs. 2015 2015 vs. 2014 Fav/(Unfav) Fav/(Unfav)(Dollars in millions)2016 2015 2014 $ % $ %CERP$2,195 $2,154 $2,065 $41 1.9% $89 4.3%CGP1,697 1,620 1,319 77 4.8% 301 22.8%Other(15) (3) (12) (12) * 9 75.0%Total CERP and CGP3,877 3,771 3,372 106 2.8% 399 11.8%CEOC— 164 4,812 * * * *Other— (6) (217) * * * *Total CEOC— 158 4,595 * * * *Consolidated Caesars$3,877 $3,929 $7,967 * * * *Cash ADR (1) Years Ended December 31, 2014 , 2015 , and 2016____________________(1) Average cash daily rate (“cash ADR”) is a key indicator by which we evaluate the performance of our properties and is determined by room revenue and rooms occupied.39CERP PerformanceNet revenues increased $41 million , or 1.9% , in 2016 compared with 2015 primarily due to increases in rooms revenue and other revenues. Net revenuesincreased $89 million , or 4.3% , in 2015 compared with 2014 , primarily due to increases in casino revenues and rooms revenue. The increases were attributable tothe following:•Rooms revenue increased $25 million in 2016 and $42 million in 2015 . The expansion of resort fees to all CERP properties during 2015, improved hotelyield as result of newly renovated rooms becoming available during 2016 at Harrah’s Las Vegas, and the opening of the Harrah’s Atlantic CityWaterfront Conference Center (the “Atlantic City Conference Center”) in the third quarter 2015 drove an increase in CERP’s cash ADR from $102 in2014 to $114 in 2015 and $124 in 2016 .•Scheduled room renovations caused a reduction of approximately 2% of room nights available during 2016 compared with 2015 , primarily at Paris LasVegas and Harrah’s Las Vegas, which partially offset the 2016 increase in rooms revenue.•Casino revenues increased $32 million in 2015 compared with 2014 , due to a reduction in costs related to variable marketing programs, such as REELREWARDS, discounts, and free play, that are treated as a reduction in revenue.•Other revenues increased $18 million in 2016 compared with 2015 , primarily due to new performers and additional scheduled performances at the RioLas Vegas, which contributed to higher entertainment revenue in 2016.CGP PerformanceNet revenues increased $77 million , or 4.8% , in 2016 compared with 2015 primarily due to increases in rooms revenue and other revenues. Net revenuesincreased $301 million , or 22.8% , in 2015 compared with 2014 , primarily due to increases in casino revenues as well as improved food and beverage revenuesand rooms revenues. The increases were attributable to the following:•Rooms revenue increased $38 million in 2016 and $65 million in 2015 . Room renovations at The LINQ Hotel & Casino (“The LINQ Hotel”) weresubstantially completed and available to guests in early May 2015, which resulted in increases in room nights available of approximately 14% in 2016 and24% in 2015 compared with the corresponding prior year periods. In addition, the expansion of resort fees and improved hotel yield drove an increase inCGP’s cash ADR from $108 in 2014 to $123 in 2015 and $132 in 2016 .•Other revenues increased $35 million in 2016 compared with 2015 , primarily due to new performers at Planet Hollywood Resort & Casino, whichcontributed to higher entertainment revenue in 2016.•Casino revenues and food and beverage revenues increased $214 million and $28 million , respectively, in 2015 compared with 2014 , primarily due tohigher volume at The LINQ Hotel after the completion of renovations, and the benefit of The Cromwell and Horseshoe Baltimore operating for the fullyear in 2015 after opening during 2014.•Partially offsetting the 2015 increase in casino revenues was a decline at Harrah’s New Orleans, which was mostly due to the New Orleans smoking banthat was enacted in April 2015.Analysis of Key Drivers of Income/(Loss) from Operations Performance for CERP and CGPIncome from operations was $257 million in 2016 compared with $337 million in 2015 and a loss from operations of $245 million in 2014 . After net revenues, thekey drivers of income/(loss) from operations during 2016 and 2015 were primarily property, administrative, general and other (including CIE stock-basedcompensation expense); impairments; corporate expense; and depreciation and amortization.40Income/(Loss) from Operations by Category - CERP and CGP Years Ended December 31, 2016 vs. 2015 2015 vs. 2014 Fav/(Unfav) Fav/(Unfav)(Dollars in millions)2016 2015 2014 $ % $ %Net revenues$3,877 $3,771 $3,372 $106 2.8 % $399 11.8 % Operating expenses Casino expense1,128 1,122 1,071 (6) (0.5)% (51) (4.8)%Food and beverage383 388 386 5 1.3 % (2) (0.5)%Rooms249 223 209 (26) (11.7)% (14) (6.7)%Property, general, administrative, and other (“PGA& O”)1,166 1,022 1,000 (144) (14.1)% (22) (2.2)%Depreciation and amortization439 361 315 (78) (21.6)% (46) (14.6)%Impairments— 1 435 1 100.0 % 434 99.8 %Corporate expense166 169 95 3 1.8 % (74) (77.9)%Other operating costs89 148 106 59 39.9 % (42) (39.6)%Total operating expenses3,620 3,434 3,617 (186) (5.4)% 183 5.1 %Income/(loss) from operations$257 $337 $(245) $(80) (23.7)% $582 *____________________*Not meaningful.Increase/(Decrease) in Income/(Loss) from OperationsYears Ended December 31, 2014 through December 31, 201641Income/(Loss) from Operations - by Segment Years Ended December 31, 2016 vs. 2015 2015 vs. 2014 Fav/(Unfav) Fav/(Unfav)(Dollars in millions)2016 2015 2014 $ % $ %CERP$389 $411 $(32) $(22) (5.4)% $443 *CGP20 253 (221) (233) (92.1)% 474 *Other(152) (327) 8 175 53.5 % (335) *Total CERP and CGP257 337 (245) (80) (23.7)%582 *CEOC— 9 (323) * * * *Other— — 13 * * * *Total CEOC— 9 (310) * * * *Consolidated Caesars$257 $346 $(555) * * * *____________________* Not meaningful.Impairments - by Segment (1) Years Ended December 31,(In millions)2016 2015 2014CERP$— $— $277CGP— 1 158CEOC— — 559Total$— $1 $994____________________(1) See Notes 6 and 7 for additional information.CERP PerformanceIncome from operations decreased $22 million in 2016 compared with 2015 primarily due to increases in direct rooms expenses and depreciation and amortization.Income from operations improved $443 million in 2015 compared with 2014 , primarily due to increased revenue combined with a reduction in impairmentcharges and direct operating expenses. The fluctuations were attributable to the following:•In 2016 , direct rooms expenses increased consistently with the increase in rooms revenues, and depreciation and amortization increased due to theremoval and replacement of certain assets related to ongoing property renovation projects primarily at Harrah’s Las Vegas, Paris Las Vegas, andFlamingo Las Vegas, as well as depreciation expense related to the Atlantic City Conference Center, which opened during 2015. The increase in operatingexpenses more than offset the increase in net revenues described above.•In 2015 , the improvement was primarily attributable to the increase in net revenues and because there were no impairment charges during 2015 comparedwith $277 million during 2014 (see Note 7 ). In addition, cost savings initiatives implemented in the fourth quarter of 2014 also contributed to thereduction in operating expenses.42CGP PerformanceIncome from operations decreased $233 million in 2016 compared with 2015 and increased $474 million in 2015 compared with 2014 . CGP’s income fromoperations includes the effect of the change in the liability associated with CGP’s contingently issuable non-voting membership units due to CEC, which decreasedCGP’s income from operations $117 million in 2016 and increased CGP’s income from operations $156 million in 2015 compared with the corresponding prioryear periods. The units were issued to CEC during 2016, and no liability was outstanding for CGP as of December 31, 2016 (see Note 2 ). The effect of thesechanges is eliminated in consolidation with the offsetting amounts being reflected in “Other” in the “Income/(Loss) from Operations - by Segment” table above.Excluding the effect of CGP’s contingently issuable non-voting membership units from both periods, CGP’s income/(loss) from operations decreased $116 millionin 2016 and increased $318 million in 2015 compared with the corresponding prior year periods.•In 2016 , the decrease was primarily due to the accelerated vesting of CIE equity awards resulting in increases in CIE stock-based compensation expense.Stock-based compensation expense was $189 million in 2016 compared with $31 million in 2015. In addition, CIE incurred costs related to the sale of theSMG Business. Upon the closing of the SMG Business sale, all outstanding CIE stock-based compensation awards were deemed fully vested and weresubsequently paid in cash in connection with the closing of the SMG Business sale, as described in Note 17 .•The portion of CIE’s stock-based compensation expense directly identifiable with employees of the SMG Business was reclassified to discontinuedoperations for all periods presented in the Statements of Operations (see Note 17 ). The portion of CIE’s stock-based compensation expense not directlyidentifiable with employees of the SMG Business was included in property, general, administrative, and other in the Statements of Operations. For theyear ended December 31, 2016 , the majority of stock-based compensation expense resulted from the acceleration of the vesting of CIE stock-basedcompensation awards.•In 2015 , the improvement was primarily attributable to the increase in net revenues and because there were no material impairment charges during 2015compared with $158 million during 2014 (see Note 7 ). In addition, cost savings initiatives also contributed to the reduction in operating expenses.Other PerformanceAs described above, “Other” in the “Income/(Loss) from Operations - by Segment” table above includes the intercompany elimination that offsets the change inliability associated with CGP’s contingently issuable non-voting membership units. Excluding the effect of contingently issuable non-voting membership units,other loss from operations was $152 million in 2016 , $210 million in 2015 , and $31 million in 2014 .During 2016 and 2015 , as described above and in Note 1 , CEC (the parent holding company) incurred expenses related to CEOC’s bankruptcy activity and theRSAs and incurred other legal expenses related to ongoing litigation. During 2015, CEC also accrued $35 million for a payment due to CEOC (see Note 1 ).Interest Expense and Other Factors that Affect Net Income/(Loss)Interest Expense 2016 vs. 2015 2015 vs. 2014 Years Ended December 31, Fav/(Unfav) Fav/(Unfav)(Dollars in millions)2016 2015 2014 $ % $ %CEOC$— $87 $2,184 $87 * $2,097 *CERP 396 399 389 3 0.8 % (10) (2.6)%CGP198 195 169 (3) (1.5)% (26) (15.4)%Other (1)5 2 (73) (3) (150.0)% (75) *Total$599 $683 $2,669 84 * $1,986 *____________________* Not meaningful.(1) Activity in 2014 primarily consisted of the elimination of intercompany interest paid by CEOC for debt instruments held by CGP.43Other Factors Affecting Net Income/(Loss) (including CEOC) 2016 vs. 2015 2015 vs. 2014 Years Ended December 31, Fav/(Unfav) Fav/(Unfav)(Dollars in millions)2016 2015 2014 $ % $ %Interest expense$599 $683 $2,669 $84 * $1,986 *Deconsolidation and restructuring of CEOC and other(5,758) 6,115 (95) (11,873) * 6,210 *Income tax benefit/(provision)(27) 119 596 (146) * (477) (80.0)%Discontinued operations3,380 155 (143) 3,225 * 298 *____________________* Not meaningful.Interest expense is primarily attributable to the outstanding debt described in Note 11 . Interest expense decreased $84 million in 2016 compared with 2015 and$2.0 billion in 2015 compared with 2014 , both of which were primarily due to the deconsolidation of CEOC. Excluding the effect of the CEOC deconsolidation,interest expense increased $3 million in 2016 and $38 million in 2015 . The increase in 2015 was primarily due to:•a $26 million increase in interest associated with the CGPH Term Loan and CGPH Notes, which provided funding for the four properties CGP acquiredfrom CEOC in May 2014, and the Horseshoe Baltimore Credit and FF&E Facilities after Horseshoe Baltimore construction was completed in the secondquarter of 2014;•a $27 million reduction in capitalized interest due to CERP completing The LINQ promenade in the first quarter of 2014 and CGP completing TheCromwell in the second quarter of 2014 and Horseshoe Baltimore in the third quarter; and•a partially offsetting $15 million reduction related to the Planet Hollywood debt that was repaid in the second quarter of 2014 with proceeds from theCGPH Term Loan.Deconsolidation and Restructuring of CEOC and OtherAs described in Note 1 , we recognized certain obligations that we believe will ultimately be settled under the Third Amended Plan or the RSAs. As a result, during2016 , we accrued $5.7 billion of expenses associated with the CEOC restructuring. A portion of the obligations we recognized reflect our estimates of the fairvalue of the consideration CEC has agreed to provide in exchange for the settlement of litigation claims and potential claims against CEC and its affiliates. Asdescribed in Note 8 , these obligations will be accounted for at fair value each period until they are ultimately settled as part of the Restructuring, and a fluctuationin the value of one or more of the inputs to our fair value estimates could result in a significant adjustment to the fair value of these obligations.As described in Note 2 , effective January 15, 2015, we deconsolidated CEOC and recognized a gain of $7.1 billion during 2015 .We recognized losses on extinguishment of debt of $96 million in 2014 , of which $67 million related to CEOC debt transactions and $28 million related to CGP.Income TaxesThe effective tax rate was negative 0.4% for 2016 , negative 2.1% for 2015 , and 18.0% for 2014 . See Note 16 for a detailed discussion of income taxes and theeffective tax rate.Discontinued OperationsDiscontinued operations primarily represent CIE’s SMG Business, which was sold on September 23, 2016, as well as activity for certain properties owned byCEOC that occurred prior to its deconsolidation in January 2015. See Note 17 for additional information.44Reconciliation of Non-GAAP Financial MeasuresProperty earnings before interest, taxes, depreciation and amortization (“EBITDA”) is presented as a measure of the Company’s performance. Property EBITDA isdefined as revenues less property operating expenses and is comprised of net income/(loss) before (i) interest expense, net of interest capitalized and interestincome, (ii) income tax (benefit)/provision, (iii) depreciation and amortization, (iv) corporate expenses, and (v) certain items that we do not consider indicative ofits ongoing operating performance at an operating property level. As a result of the sale of the SMG Business (see Note 17 ), we have determined that CIE stock-based compensation expense should be excluded from Property EBITDA as management no longer considers such expense to be indicative of CaesarsEntertainment’s ongoing consolidated or segment operating performance. Therefore, Property EBITDA has been recast for prior periods to be consistent to thecurrent year presentation.In the future, we may incur expenses that are the same or similar to some of the adjustments in this presentation. The presentation of Property EBITDA should notbe construed as an inference that future results will be unaffected by unusual or unexpected items.Property EBITDA is a non-GAAP financial measure commonly used in our industry and should not be construed as an alternative to net income/(loss) as anindicator of operating performance or as an alternative to cash flow provided by operating activities as a measure of liquidity (as determined in accordance withaccounting principles generally accepted in the United States (“GAAP”) ). Property EBITDA may not be comparable to similarly titled measures reported by othercompanies within the industry. Property EBITDA is included because management uses Property EBITDA to measure performance and allocate resources, andbelieves that Property EBITDA provides investors with additional information consistent with that used by management.Reconciliation of Property EBITDA Years Ended December 31,(In millions)2016 2015 2014Net income/(loss) attributable to Caesars$(3,569) $5,920 $(2,783)Net income/(loss) attributable to noncontrolling interests822 132 (83)Discontinued operations, net of income taxes(3,380) (155) 143Income tax (benefit)/provision27 (119) (596)Deconsolidation and restructuring of CEOC and other5,758 (6,115) 95Interest expense599 683 2,669Depreciation and amortization439 374 658Impairment of goodwill— — 695Impairment of tangible and other intangible assets— 1 299Corporate expense166 174 232Other operating costs89 152 203CIE stock-based compensation189 31 49Property EBITDA$1,140 $1,078 $1,581Segment Property EBITDA Years Ended December 31, 2016 vs. 2015 2015 vs. 2014 Increase/(Decrease) Increase/(Decrease)(Dollars in millions)2016 2015 2014 $ % $ %CERP$697 $672 $520 $25 3.7 % $152 29.2%CGP439 370 235 69 18.6 % 135 57.4%Other4 5 4 (1) (20.0)% 1 25.0%Total CERP and CGP1,140 1,047 759 93 8.9 % 288 37.9%CEOC— 31 822 (31) * (791) *Total Consolidated Caesars$1,140 $1,078 $1,581 62 * (503) *____________________* Not meaningful.45Liquidity and Capital ResourcesLiquidity Discussion and AnalysisAs described above, CEOC filed for reorganization under Chapter 11 of the Bankruptcy Code, and we deconsolidated CEOC effective January 15, 2015. As such,all amounts presented in the following analysis exclude the amounts related to CEOC as of December 31, 2016 and 2015 , and for periods subsequent to thedeconsolidation of CEOC.As stated previously, there is substantial doubt as to CEC’s ability to continue as a going concern as we have limited unrestricted cash available to meet thefinancial commitments of CEC, primarily resulting from significant expenditures made to (1) defend the Company in the litigation discussed in Note 3 and (2)support the Restructuring. In addition, we have made material future commitments to support the Restructuring, and we are a defendant in litigation, including theNoteholder Disputes, and other noteholder disputes relating to certain CEOC transactions dating back to 2010, that if resolved against us would raise substantialdoubt about CEC’s ability to continue as a going concern. See Note 1 for a full description.We are a highly-leveraged company and had $6.9 billion in face value of debt outstanding as of December 31, 2016 . As a result, a significant portion of ourliquidity needs are for debt service, including significant interest payments. As detailed in the table below, our estimated debt service (including principal andinterest) is $659 million for 2017 and $8.8 billion thereafter to maturity. See Note 11 for details of our debt outstanding and related restrictive covenants.CEC is primarily a holding company with no independent operations, employees, or debt issuances of its own. It has ownership interests in CEOC, CERP andCGP. CEC has no requirement to fund the operations of CEOC, CERP, CGP, or their subsidiaries. CEC cash outflows are primarily used for corporatedevelopment opportunities, other corporate-level activity, litigation, and restructuring expenses associated with CEOC’s bankruptcy. CEC does not receive anyfinancial benefit from CEOC during the bankruptcy, as all earnings and cash flows are retained by CEOC. In addition, because CEC has no operations of its ownand due to the restrictions under its subsidiaries’ lending arrangements, CEC has limited ability to raise additional capital.Consolidated cash and cash equivalents as of December 31, 2016 as shown in the table below, includes amounts held by CERP, CGP, and CES, which are notreadily available to CEC. “Other” reflects amounts held by CEC and certain of its direct subsidiaries, included $109 million related to its insurance captives.Summary of Cash and Revolver Capacity December 31, 2016(In millions)CERP CGP CES OtherCash and cash equivalents$168 $1,050 $107 $188Revolver capacity270 160 — —Revolver capacity drawn or committed to letters of credit(40) — — —Total$398 $1,210 $107 $188Annual Estimated Debt Service Requirements Years ended December 31,(In millions)2017 2018 2019 2020 2021 Thereafter TotalCERP$458 $415 $425 $3,710 $1,280 $— $6,288CGP201 215 388 460 1,189 727 3,180Total principal and interest$659 $630 $813 $4,170 $2,469 $727 $9,468We generated consolidated operating cash inflows of $308 million for the year ended December 31, 2016 , including operating cash inflows of $227 million and$238 million from CERP and CGP, respectively. Our cash flows from operations include outflows by CEC related to the Restructuring of CEOC and by CESrelated to cash payments on behalf of its members for expenses accrued but not paid during 2015.CERP and CGP’s sources of liquidity are independent of one another and primarily include currently available cash and cash equivalents, cash flows generatedfrom their operations, and borrowings under their separate revolving credit facilities (see Note 11 ). Operating cash inflows are typically used for operatingexpenses, debt service costs, and working capital needs. CERP and CGP are highly leveraged, and a significant portion of their liquidity needs are for debt service,as summarized above.46CERP generated a net loss of $3 million during the year ended December 31, 2016 , which includes the effect of non-cash items, including depreciation andamortization expense, of $279 million during the year. Other than additional depreciation and amortization expense compared with the prior year (describedabove), CERP’s operating activities were relatively stable and yielded operating cash flows of $227 million , a decrease of 5.8% from the prior year. The decreasewas primarily due to the timing of interest payments, partially offset by the increase in net revenues discussed above.CERP’s capital expenditures were $127 million during 2016 in support of its ongoing property renovations, a decrease of only 1.6% compared with the prior year.In 2016 , CERP paid $426 million in interest, of which $396 million was incurred in 2016 , and repaid $76 million , net, of debt primarily on its revolving creditfacility ( $181 million in payments less $105 million in revolver draws).CGP generated a net loss from continuing operations of $175 million during the year ended December 31, 2016 , which includes the effect of non-cash items, suchas depreciation and amortization expense of $180 million , and elevated stock-based compensation expense of $189 million associated with acceleration of awardsin advance of the sale of the SMG Business. CGP’s operating cash flows increased to $238 million , which is an improvement of $129 million compared with theprior year, primarily due to the improved operating results described above for CGP.CGP’s capital expenditures were $71 million during the year, which was down $99 million compared with the prior year. For the year ended December 31, 2015 ,CGP’s capital expenditures were primarily related to The LINQ Hotel renovation. In addition to acquisitions of property and equipment, CGP paid $208 million ininterest, of which $198 million was incurred in 2016 , and repaid $72 million , net, of debt primarily on its revolving credit facility ( $87 million in payments less$15 million in revolver draws).CERP and CGP’s ability to fund operations, pay debt obligations, and fund planned capital expenditures depends, in part, upon economic and other factors that arebeyond their control, and disruptions in capital markets and restrictive covenants related to their existing debt could impact their ability to fund liquidity needs, payindebtedness, and secure additional funds through financing activities.We believe that CERP and CGP’s cash flows from operations are sufficient to cover planned capital expenditures for ongoing property renovations during 2017and estimated interest and principal payments due on long-term debt totaling $659 million . However, if needed, their existing cash and cash equivalents andavailability under their revolving credit facilities are available to further support operations during the next 12 months and the foreseeable future. In addition,restrictions under their lending arrangements generally prevent the distribution of cash to CEC, except for certain restricted payments.The foregoing liquidity discussions are forward-looking statements based on assumptions as of the date of this filing that may or may not prove to be correct.Actual results may differ materially from CEC’s present expectations. Factors that may cause actual results to differ materially from present expectations include,without limitation, the results of ongoing bankruptcy proceedings of CEOC and the positive or negative changes in the operational and other matters assumed inpreparing the CEC forecasts.Capital Spending and DevelopmentWe incur capital expenditures in the normal course of business, and we perform ongoing refurbishment and maintenance at our existing casino entertainmentfacilities to maintain our quality standards. We also continue to pursue development and acquisition opportunities for additional casino entertainment and otherhospitality facilities, and online businesses that meet our strategic and return on investment criteria. Cash used for capital expenditures in the normal course ofbusiness is typically made available from cash flows generated by our operating activities and established debt programs, while cash used for development projectsis typically funded from established debt programs, specific project financing, and additional debt offerings.47Summary of Consolidated Capital Expenditures Years Ended December 31, Increase/(Decrease)(In millions)2016 2015 20142016 vs 2015 2015 vs 2014Development$3 $96 $360 $(93) $(264)Renovation/refurbishment189 207 573 (18) (366)Other28 38 58 (10) (20)Total capital expenditures$220 $341 $991 $(121) $(650) Included in capital expenditures: Capitalized payroll costs$5 $5 $11 Capitalized interest2 12 45 Summary of Capital Expenditures by Entity Years Ended December 31,(In millions)2016 2015 2014CEOC$— $4 $249CERP127 129 179CGP71 170 558CES22 38 5Total$220 $341 $991For the year ended December 31, 2016 , capital expenditures were primarily related to hotel renovation projects at Harrah’s Las Vegas, Paris Las Vegas, and PlanetHollywood. During the year ended December 31, 2015 , capital expenditures were primarily related to The LINQ Hotel renovation and the Atlantic CityConference Center, which was still under construction in the first quarter of 2015. Capital expenditures decreased in 2015 compared with 2014 primarily due toexpenditures in 2014 associated with the Horseshoe Baltimore development and renovations for The Cromwell, combined with the decline due to thedeconsolidation of CEOC effective January 15, 2015.Projected Capital Expenditures for 2017(In millions)Low HighCERP$180 $230CGP150 195CES40 50Total$370 $475We expect to fund these capital expenditures from cash flows generated by our operating activities. CES capital expenditures will be funded by its Members. Ourprojected capital expenditures for 2017 include estimates for:•Hotel remodeling projects at CGP’s Planet Hollywood, Bally’s Las Vegas, and Harrah’s New Orleans;•Hotel remodeling projects at CERP’s Flamingo Las Vegas, Harrah’s Atlantic City, Paris Las Vegas, and Harrah’s Las Vegas;•Hospitality and maintenance projects; and•IT, marketing, analytics, accounting, payroll, and other projects that benefit the operating structures.Our planned development projects, if they proceed, will require, individually and in the aggregate, significant capital commitments and, if completed, may result insignificant additional revenues. The commitment of capital, the timing of completion, and the commencement of operations of development projects are contingentupon, among other things, negotiation of final agreements and receipt of approvals from the appropriate political and regulatory bodies. We must also comply withcovenants and restrictions set forth in our debt agreements.48There are various risks and uncertainties and the expected capital expenditures set forth above may change for various reasons, including our financialperformance, market conditions and the CEOC bankruptcy process.Summary of Debt and Revolving Credit Facility Cash Flows from Financing Activities December 31, 2016 December 31, 2015(In millions)Proceeds Repayments Proceeds RepaymentsCERP Term Loan$— $(25) $— $(25)CERP Senior Secured Revolving Credit Facility105 (145) 230 (330)CGPH Senior Secured Term Loan— (12) — (12)CGPH Senior Secured Revolving Credit Facility15 (60) 80 (35)Horseshoe Baltimore Credit Facility— (3) — —Horseshoe Baltimore FF&E Facility— (5) — (3)Cromwell Credit Facility— (3) — (10)Other Debt Activity— (10) — (25)Capital Lease Payments— (5) — (10)Total$120 $(268) $310 $(450)Related-Party TransactionsWe participate with our subsidiaries including CEOC in marketing, purchasing, insurance, employee benefit, and other programs that are defined, negotiated andmanaged by CES. The Company believes that participating in these consolidated programs is beneficial in comparison to the cost and terms for similar programsthat it could negotiate on a standalone basis. For a more complete description of the nature and extent of these transactions, see Note 18 .Critical Accounting Policies and EstimatesWe prepare our financial statements in conformity with GAAP. In preparing our financial statements, we have made our best estimates and judgments of theamounts and disclosures included in the financial statements, giving regard to materiality. When more than one accounting principle, or method of its application,is generally accepted, we select the principle or method that we consider to be the most appropriate under specific circumstances. Application of these accountingprinciples requires us to make estimates about the future resolution of existing uncertainties. Certain of our accounting policies, including the estimated livesassigned to our assets, the determination of bad debt, asset impairments, self-insurance reserves, the purchase price allocations made in connection with ouracquisitions/mergers, the calculation of our income tax liabilities, and the determination of whether to consolidate a variable interest entity require that we applysignificant judgment in defining the appropriate assumptions for calculating financial estimates.We consider accounting estimates to be critical accounting policies when:•the estimates involve matters that are highly uncertain at the time the accounting estimate is made; and•different estimates or changes to estimates could have a material impact on the reported financial position, changes in financial position, or results ofoperations.By their nature, these judgments and estimates are subject to an inherent degree of uncertainty. Our judgments and estimates are based on our historical experience,terms of existing contracts, observance of trends in the industry, information gathered from customer behavior, and information available from other outsidesources, as appropriate. Due to the inherent uncertainty involving judgments and estimates, actual results may differ from those estimates.The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern and do not include anyadjustments that might result from the outcome of any uncertainties related to our going concern assessment. As described in Notes 1 and 3 , we are a defendant inlitigation and other Noteholder Disputes relating to certain CEOC related transactions dating back to 2010. These matters raise substantial doubt about CEC’sability to continue as a going concern. Management's plans concerning these matters are discussed in Note 1 .49Long-Lived AssetsWe have significant capital invested in our long-lived assets, and judgments are made in determining the estimated useful lives of assets, salvage values to beassigned to assets, and if or when an asset has been impaired. The accuracy of these estimates affects the amount of depreciation and amortization expenserecognized in our financial results and whether we have a gain or loss on the disposal of an asset. We assign lives to our assets based on our standard policy, whichis established by management as representative of the useful life of each category of asset. We review the carrying value of our long-lived assets whenever eventsand circumstances indicate that the carrying value of an asset may not be recoverable from the estimated future cash flows expected to result from its use andeventual disposition. The factors considered by management in performing this assessment include current operating results, trends and prospects, as well as theeffect of obsolescence, demand, competition, and other economic, legal, and regulatory factors. In estimating expected future cash flows for determining whetheran asset is impaired, assets are grouped at the lowest level of identifiable cash flows, which, for most of our assets, is the individual property. See Note 6 foradditional information.Goodwill and Other Non-Amortizing Intangible AssetsThe evaluation of goodwill and other non-amortizing intangible assets requires the use of estimates about future revenues and EBITDA, valuation multiples, anddiscount rates to determine their estimated fair value. Our future revenues and EBITDA assumptions are determined based upon actual results giving effect toexpected changes in operating results in future years. Our valuation multiples and discount rates are based upon market participant assumptions using a definedgaming peer group. Changes in these assumptions can materially affect these estimates. Thus, to the extent the gaming volumes deteriorate further in the nearfuture, discount rates increase significantly, or we do not meet our projected performance, we could recognize impairments, and such impairments could bematerial. This is especially true for any of our properties where goodwill and other non-amortizing intangible assets have been partially impaired as a result of arecent impairment analysis, and for our Las Vegas properties, which comprise a significant portion of our remaining goodwill balance.As of December 31, 2016 , we had approximately $1.6 billion in goodwill and $148 million of other non-amortizing intangible assets. As of December 31, 2016 ,all reporting units with goodwill and/or other non-amortizing intangible assets have estimated fair values that exceed their carrying values. See Note 7 foradditional information.Allowance for Doubtful Accounts - GamingWe reserve an estimated amount for gaming receivables that may not be collected to reduce the Company’s receivables to their net carrying amount.Methodologies for estimating the allowance for doubtful accounts range from specific reserves to various percentages applied to aged receivables. Historicalcollection rates are considered, as are customer relationships, in determining specific reserves. As with many estimates, management must make judgments aboutpotential actions by third parties in establishing and evaluating our reserves for allowance for doubtful accounts. As of December 31, 2016 , a 5% increase ordecrease to the allowance determined based on a percentage of aged receivables would change the reserve by approximately $4 million .Self-Insurance AccrualsWe repay CEOC for estimated employee medical insurance claims with residual differences between estimated and actual claims being reported in due to/fromaffiliates. We continue to be self-insured for workers’ compensation and other risk products through our captive insurance subsidiaries and provide insurancecoverage to CEOC. We receive insurance premiums from CEOC on an installment basis, which are intended to cover claims processed on CEOC’s behalf.Our insurance claims and reserves include accruals of estimated settlements for known claims, as well as accruals of actuarial estimates of incurred but notreported claims. In estimating these reserves, historical loss experience and judgments about the expected levels of costs per claim are considered. We also utilizeconsultants to assist in the determination of certain estimated accruals. These claims are accounted for based on actuarial estimates of the undiscounted claims,including those claims incurred but not yet reported. We believe the use of actuarial methods to account for these liabilities provides a consistent and effective wayto measure these highly judgmental accruals; however, changes in health care costs, accident frequency and severity, and other factors can materially affect theestimates for these liabilities. We regularly monitor the potential for changes in estimates, evaluate our insurance accruals, and adjust our recorded provisions.Accrued Restructuring and Support ExpensesAs described in Notes 1 and 8 , CEC has made material future commitments to support the Restructuring, and as a result of the Bankruptcy Court’s confirmation ofthe Third Amended Plan, we believe it is probable that certain obligations in the Third Amended Plan and the RSAs will ultimately be settled. Therefore, we haveaccrued the items described in Note 1 that are estimable in accrued50restructuring and support expenses on the Balance Sheets. The accrual represents an estimate of the total consideration we expect to provide in support of theRestructuring, which includes a combination of cash, CEC common stock, and CEC Convertible Notes.A portion of the obligations we recognized reflect our estimates of the fair value of the consideration CEC has agreed to provide in the form of CEC CommonStock, CEC Convertible Notes, and the PropCo Call Right in exchange for the settlement of litigation claims and potential claims against CEC and its affiliates.These obligations will be accounted for at fair value each period until they are ultimately settled as part of the Restructuring.Some of the key assumptions used in the valuation models include (see Note 8 for more details regarding fair value measurements):•CEC Convertible Notes – CEC’s current estimated incremental cost of borrowing and the estimated volatility of CEC’s common stock;•CEC Common Stock – the value and estimated volatility of CEC common stock and the risk-free rate; and•PropCo Call Right – EBITDAR volatility, the ratio of EBITDAR to initial rent under the property lease, and the enterprise value to revenue volatility.Should these assumptions fluctuate over time, it could result in an increase or decrease in the fair value of the CEC Convertible Notes, the CEC Common Stock,and the PropCo Call Right and the corresponding restructuring accrual. Specifically, an increase in the volatility assumptions would result in an increase in therestructuring accrual.Income TaxesWe are subject to income taxes in the United States (including federal and state) and numerous foreign jurisdictions in which we operate. We record income taxesunder the asset and liability method, whereby deferred tax assets and liabilities are recognized based on the expected future tax consequences of temporarydifferences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and as attributable to operating lossand tax credit carryforwards. We reduce the carrying amounts of deferred tax assets by a valuation allowance if, based on the available evidence, it is more likelythan not that such assets will not be realized. Accordingly, the need to establish valuation allowances for deferred tax assets is assessed periodically based on the“more likely than not” realization threshold. This assessment considers, among other matters, the nature, frequency, and severity of current and cumulative losses,forecasts of future profitability, the duration of statutory carryforward periods, our experience with operating loss and tax credit carryforwards not expiring unused,and tax planning alternatives.The effect on the income tax provision and deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes theenactment date. We have provided a valuation allowance on certain foreign and state net operating losses (“NOLs”), and other federal, state, and foreign deferredtax assets. NOLs and other federal, state, and foreign deferred tax assets were not deemed realizable based upon near term estimates of future taxable income.We report unrecognized tax benefits within accrued expenses and deferred credits and other in our balance sheets, separate from any related income tax payable,which is also reported within accrued expenses, or deferred income taxes. Reserve amounts relate to any potential income tax liabilities resulting from uncertaintax positions, as well as potential interest or penalties associated with those liabilities.We file income tax returns, including returns for our subsidiaries, with federal, state, and foreign jurisdictions. We are under regular and recurring audit by theInternal Revenue Service and various state taxing authorities on open tax positions, and in general, it is possible that the amount of the liability for unrecognizedtax benefits could change during the next 12 months.ConsolidationWe consolidate all subsidiaries in which we have a controlling financial interest and variable interest entities (“VIEs”) for which we or one of our consolidatedsubsidiaries is the primary beneficiary. Control generally equates to ownership percentage, whereby (1) affiliates that are more than 50% owned are consolidated;(2) investments in affiliates of 50% or less but greater than 20% are generally accounted for using the equity method where we are have determined that we havesignificant influence over the entities; and (3) investments in affiliates of 20% or less are generally accounted for using the cost method.51We consolidate a VIE when we have both the power to direct the activities that most significantly impact the results of the VIE and the right to receive benefits orthe obligation to absorb losses of the entity that could be potentially significant to the VIE. For VIEs that are under common control with affiliates, in lieu of anassessment of the power to direct the activities that most significantly impact the results of the VIE, we may be required to assess a number of other factors todetermine the consolidating entity, including the following: (i) the closeness of the association that the VIE has with the businesses of the affiliated entities, (ii) theentity from which the VIE obtained its assets; (iii) the nature of ongoing management and other agreements; and (iv) the obligation to absorb losses and the right toreceive residual returns that could potentially be significant to the VIE.Along with the VIEs that are consolidated in accordance with the above guidelines, we also hold variable interests in other VIEs that are not consolidated becausewe are not the primary beneficiary. Despite a majority financial interest, we may only possess non-substantive voting rights that do not confer upon us the ability tocontrol key activities of the entity, such as determining operating budgets, payment of obligations, management of assets, and/or other activities necessary for theordinary course of business.We continually monitor both consolidated and unconsolidated VIEs to determine if any events have occurred that could cause the primary beneficiary to change. Achange in determination could have a material impact on our financial statements, see Note 2 .Recently Issued and Proposed Accounting StandardsSee Note 5 for discussions of the adoption and potential impact of recently issued accounting standards.Contractual Obligations and CommitmentsThe table below summarizes Caesars Entertainment’s contractual obligations and other commitments through their respective maturity or ending dates as ofDecember 31, 2016 . Payments due by Period (1)(In millions)Total Less than1 year 1-3years 4-5years After5 yearsDebt, face value$6,946 $87 $273 $5,899 $687Capital lease obligations2 2 — — —Estimated interest payments (2)2,520 570 1,170 740 40Operating lease obligations1,139 43 76 76 944Purchase order obligations378 230 112 24 12Community reinvestment47 6 12 12 17Construction commitments50 50 — — —Entertainment obligations (3)2 2 — — —Other contractual obligations (4)84 25 25 17 17Total contractual obligations$11,168 $1,015 $1,668 $6,768 $1,717____________________(1) In addition to the contractual obligations disclosed in this table, we have unrecognized tax benefits for which, based on uncertainties associated with the items, we are unable to makereasonably reliable estimates of the period of potential cash settlements, if any, with taxing authorities.(2) Estimated interest for variable-rate debt included in this table is based on the 1-month and 3-month LIBOR curve available as of December 31, 2016 . Estimated interest includes interestrelated to capital leases.(3) Entertainment obligations represent obligations to pay performers that have contracts for future performances. This amount does not include estimated obligations for future performanceswhere payment is only guaranteed when the performances occur and/or is based on factors contingent upon the profitability of the performances.(4) Primarily includes licensing, management, and other fees.52ITEM 7A.Quantitative and Qualitative Disclosure About Market RiskMarket risk is the risk of loss arising from adverse changes in market rates and prices, such as interest rates, foreign currency exchange rates and commodityprices. Our primary exposure to market risk is interest rate risk associated with our debt. As of December 31, 2016 , the face value of long term debt was $6.9billion , including $4.1 billion of variable-rate obligations. Assuming a constant outstanding balance for our variable-rate long term debt, a hypothetical 1%decrease in interest rates would not have a material impact on interest expense, while a hypothetical 1% increase in interest rates would increase interest expenseapproximately $39 million .Historically, we have attempted to limit our exposure to interest rate risk by using interest rate caps to mitigate interest rate risk associated with our variable ratedebt instruments, but we did not have any active swaps or caps as of December 31, 2016 . We did not purchase or hold any derivative financial instruments fortrading purposes. While we may enter into agreements limiting our exposure to higher interest rates, any such agreements may not offer complete protection fromthis risk.53ITEM 8 .Financial Statements and Supplementary DataREPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMTo the Board of Directors and Stockholders ofCaesars Entertainment Corporation:We have audited the accompanying consolidated balance sheets of Caesars Entertainment Corporation and subsidiaries (the "Company") as of December 31, 2016and 2015, and the related consolidated statements of operations and comprehensive income/(loss), stockholders' equity/(deficit), and cash flows for each of thethree years in the period ended December 31, 2016. Our audits also included the financial statement schedule listed in the Index at Item 15. These financialstatements and the financial statement schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on the financialstatements and financial statement schedule based on our audits.We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that weplan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining,on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used andsignificant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basisfor our opinion.In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Caesars Entertainment Corporation andsubsidiaries as of December 31, 2016 and 2015, and the results of their operations and their cash flows for each of the three years in the period ended December 31,2016, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, such financial statement schedule, whenconsidered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein.As discussed in Note 1 to the consolidated financial statements, on January 15, 2015, the Company’s majority owned subsidiary, Caesars Entertainment OperatingCompany, Inc. (CEOC) and certain of its U.S. subsidiaries voluntarily filed for reorganization under Chapter 11 of the Bankruptcy Code, which resulted in thedeconsolidation of CEOC effective January 15, 2015.The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Notes 1 and3 to the consolidated financial statements, the Company is a defendant in litigation and other noteholder disputes concerning certain transactions related to CEOC.Additionally, as described in Note 1 to the consolidated financial statements, pursuant to CEOC’s plan of reorganization and related restructuring supportagreements the Company has agreed to provide significant cash and non-cash consideration to the CEOC creditors. In order to meet its ongoing obligations whenthey come due and its commitments under the CEOC plan of reorganization, the Company will need to secure additional sources of funding, complete thepreviously announced merger with Caesars Acquisition Company, and obtain regulatory approvals for the CEOC plan of reorganization. The uncertainty of theoutcome of these matters raises substantial doubt about the Company’s ability to continue as a going concern. Management's plans concerning these matters arediscussed in Notes 1 and 3 to the consolidated financial statements. The consolidated financial statements do not include any adjustments that might result from theoutcome of these uncertainties.We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Company's internal control overfinancial reporting as of December 31, 2016, based on the criteria established in Internal Control - Integrated Framework (2013) issued by the Committee ofSponsoring Organizations of the Treadway Commission and our report dated February 14, 2017 expressed an unqualified opinion on the Company's internalcontrol over financial reporting./s/ DELOITTE & TOUCHE LLPLas Vegas, NevadaFebruary 14, 201754CAESARS ENTERTAINMENT CORPORATIONCONSOLIDATED BALANCE SHEETS As of December 31,(In millions, except par value)2016 2015Assets Current assets Cash and cash equivalents ($1,157 and $948 attributable to our VIEs)$1,513 $1,227Restricted cash ($3,040 and $3 attributable to our VIEs)3,113 58Receivables, net ($76 and $63 attributable to our VIEs)160 134Due from affiliates, net ($64 and $33 attributable to our VIEs)64 34Prepayments and other current assets ($61 and $46 attributable to our VIEs)118 121Inventories ($7 and $7 attributable to our VIEs)20 21Current assets held for sale ($0 and $364 attributable to our VIEs)— 364Total current assets4,988 1,959Property and equipment, net ($2,537 and $2,607 attributable to our VIEs)7,446 7,584Goodwill ($206 and $206 attributable to our VIEs)1,608 1,608Intangible assets other than goodwill ($191 and $206 attributable to our VIEs)433 498Restricted cash ($5 and $9 attributable to our VIEs)5 109Deferred charges and other assets ($240 and $253 attributable to our VIEs)414 448Total assets$14,894 $12,206 Liabilities and Stockholders’ Equity/(Deficit) Current liabilities Accounts payable ($143 and $124 attributable to our VIEs)$215 $161Due to affiliates ($94 and $15 attributable to our VIEs)112 16Accrued expenses and other current liabilities ($312 and $232 attributable to our VIEs)664 550Accrued restructuring and support expenses6,601 905Interest payable ($14 and $37 attributable to our VIEs)67 131Current portion of long-term debt ($21 and $70 attributable to our VIEs)89 187Current liabilities held for sale ($0 and $66 attributable to our VIEs)— 66Total current liabilities7,748 2,016Long-term debt ($2,254 and $2,267 attributable to our VIEs)6,749 6,777Deferred income taxes ($0 and $13 attributable to our VIEs)1,722 1,000Deferred credits and other liabilities ($33 and $125 attributable to our VIEs)93 180Total liabilities16,312 9,973Commitments and contingencies (Note 3) Stockholders’ equity/(deficit) Common stock: voting, $0.01 par value, 150 and 147 shares issued, respectively1 1Treasury stock: 3 and 2 shares, respectively(29) (21)Additional paid-in capital7,605 8,190Accumulated deficit(10,753) (7,184)Accumulated other comprehensive income/(loss)(1) 1Total Caesars stockholders’ equity/(deficit)(3,177) 987Noncontrolling interests1,759 1,246Total stockholders’ equity/(deficit)(1,418) 2,233Total liabilities and stockholders’ equity/(deficit)$14,894 $12,206See accompanying Notes to Consolidated Financial Statements.55CAESARS ENTERTAINMENT CORPORATIONCONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME/(LOSS) Years Ended December 31,(In millions, except per share data)2016 2015 2014Revenues Casino$2,177 $2,286 $5,418Food and beverage788 823 1,495Rooms923 878 1,207Other revenue527 495 742Reimbursed management costs— 10 243Less: casino promotional allowances(538) (563) (1,138)Net revenues3,877 3,929 7,967 Operating expenses Direct Casino1,128 1,194 3,253Food and beverage383 399 694Rooms249 227 315Property, general, administrative, and other1,166 1,052 1,930Reimbursable management costs— 10 243Depreciation and amortization439 374 658Impairment of goodwill— — 695Impairment of tangible and other intangible assets— 1 299Corporate expense166 174 232Other operating costs89 152 203Total operating expenses3,620 3,583 8,522Income/(loss) from operations257 346 (555)Interest expense(599) (683) (2,669)Deconsolidation and restructuring of CEOC and other(5,758) 6,115 (95)Income/(loss) from continuing operations before income taxes(6,100) 5,778 (3,319)Income tax benefit/(provision)(27) 119 596Income/(loss) from continuing operations, net of income taxes(6,127) 5,897 (2,723)Discontinued operations, net of income taxes3,380 155 (143)Net income/(loss)(2,747) 6,052 (2,866)Net (income)/loss attributable to noncontrolling interests(822) (132) 83Net income/(loss) attributable to Caesars$(3,569) $5,920 $(2,783) Earnings/(loss) per share - basic and diluted Basic earnings/(loss) per share from continuing operations$(47.52) $39.80 $(18.53)Basic earnings/(loss) per share from discontinued operations23.11 1.08 (1.00)Basic earnings/(loss) per share$(24.41) $40.88 $(19.53)Diluted earnings/(loss) per share from continuing operations$(47.52) $39.20 $(18.53)Diluted earnings/(loss) per share from discontinued operations23.11 1.06 (1.00)Diluted earnings/(loss) per share$(24.41) $40.26 $(19.53)Weighted-average common shares outstanding - basic146 145 142Weighted-average common shares outstanding - diluted146 147 142 Comprehensive income/(loss): Other comprehensive loss, net of income taxes$(2) $— $(2)Comprehensive income/(loss)(2,749)6,052(2,868)Comprehensive (income)/loss attributable to noncontrolling interests(822)(132)83Comprehensive income/(loss) attributable to Caesars$(3,571)$5,920$(2,785)See accompanying Notes to Consolidated Financial Statements.56CAESARS ENTERTAINMENT CORPORATIONCONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY/(DEFICIT) Caesars Stockholders’ Equity/(Deficit) AdditionalPaid-in- Capital AccumulatedDeficit Accumulated Other Comprehensive Income/(Loss) Total CaesarsStockholders’Equity/(Deficit) NoncontrollingInterests TotalEquity/(Deficit)(In millions)CommonStock TreasuryStock Balance as of December 31, 2013$1 $(16) $7,231 $(10,321) $(17) $(3,122) $1,218 $(1,904)Net loss— — — (2,783) — (2,783) (83) (2,866)Share-based compensation— (3) 32 — — 29 — 29Common stock issuances (1)— — 136 — — 136 — 136Other comprehensive loss, net oftax— — — — (2) (2) — (2)Allocation of minority interestresulting from sales andconveyances of subsidiary stock (2)— — 754 — 4 758 (744) 14Bond distribution to noncontrollinginterest owners (3)— — — — — — (160) (160)Other— — (13) — — (13) 24 11Balance as of December 31, 20141 (19) 8,140 (13,104) (15) (4,997) 255 (4,742)Net income— — — 5,920 — 5,920 132 6,052Share-based compensation— (2) 50 — — 48 — 48Elimination of CEOCnoncontrolling interest anddeconsolidation (3)— — — — 16 16 854 870Decrease in noncontrollinginterests, net of distributions andcontributions— — — — — — (10) (10)Other— — — — — — 15 15Balance as of December 31, 20151 (21) 8,190 (7,184) 1 987 1,246 2,233Cumulative effect adjustmentshare-based compensation (4)— — 1 (1) — — — —Net income— — — (3,569) — (3,569) 822 (2,747)Share-based compensation— — 40 — — 40 — 40CIE stock transactions, net— — (626) — — (626) — (626)Other comprehensive loss, net oftax— — — — (2) (2) — (2)Change in noncontrolling interest,net of distributions andcontributions— — — — — — (309) (309)Other— (8) — 1 — (7) — (7)Balance as of December 31, 2016$1 $(29) $7,605 $(10,753) $(1) $(3,177) $1,759 $(1,418)____________________(1) We issued and sold 7 million shares in 2014.(2) In 2014, we sold 68,100 of CEC’s shares of CEOC’s common stock to qualified institutional buyers and CEOC granted 86,936 shares of its common stock to employees. We allocated $869million of accumulated stockholders’ deficit to the noncontrolling interests’ ownership in CEOC based upon the noncontrolling interests’ ownership share as of December 31, 2014, whichincluded $744 million for the allocation of noncontrolling interest resulting from sales and conveyances of CEOC stock.(3) See Note 2 .(4) Adoption of Accounting Standards Update No. 2016-09, Compensation-Stock Compensation. See Note 14 .See accompanying Notes to Consolidated Financial Statements.57CAESARS ENTERTAINMENT CORPORATIONCONSOLIDATED STATEMENTS OF CASH FLOWSYears Ended December 31,(In millions)2016 2015 2014Cash flows from operating activities Net income/(loss)$(2,747) $6,052 $(2,866)Adjustments to reconcile net income/(loss) to cash flows from operating activities: Loss/(income) from discontinued operations(3,380) (155) 143Gain on deconsolidation of CEOC— (7,125) —Loss on extinguishment of debt— — 96Depreciation and amortization439 374 651Amortization of deferred finance costs and debt discount/premium24 38 438Provision for doubtful accounts11 11 50Impairment of intangible and tangible assets— 1 994Share-based compensation expense228 94 94Deferred income taxes2 (113) (440)Other non-cash adjustments to net income/(loss)14 1 50Net changes in: Accounts receivable(22) (51) 12Due to/due from affiliates, net19 (28) 3Inventories, prepayments and other current assets(11) 1 (21)Deferred charges and other— (17) 1Accounts payable39 (47) (47)Interest payable(64) (41) 342Accrued expenses50 45 (155)Restructuring accruals5,696 905 —Deferred credits and other10 (5) (201)Other— 3 35Cash flows provided by/(used in) operating activities308 (57) (821)Cash flows from investing activities Acquisitions of property and equipment, net of change in related payables(220) (341) (991)Deconsolidation of CEOC cash— (985) —Return of investment from discontinued operations132 142 87Contributions to discontinued operations(56) (15) (89)Proceeds from the sale and maturity of investments46 29 24Payments to acquire investments(23) (27) —Other— (3) 69Cash flows used in investing activities(121) (1,200) (900)Cash flows from financing activities Proceeds from long-term debt and revolving credit facilities120 310 4,436Debt issuance and extension costs and fees— — (196)Repayments of long-term debt and revolving credit facilities(268) (450) (2,833)Payment of contingent consideration— (1) —Repurchase of CIE shares and distribution of sale proceeds(1,126) (65) —Proceeds from sale of interest in subsidiary— — 8Issuance of common stock, net of fees— — 136Distributions to noncontrolling interest owners(270) (36) —Other11 25 (30)Cash flows provided by/(used in) financing activities(1,533) (217) 1,521Cash flows from discontinued operations Cash flows from operating activities168 159 26Cash flows from investing activities4,379 (12) (26)Cash flows from financing activities(76) (158) (5)Net cash from discontinued operations4,471 (11) (5) Change in cash, cash equivalents, and restricted cash classified as assets held for sale112 (8) (52) Net increase/(decrease) in cash, cash equivalents, and restricted cash3,237 (1,493) (257)Cash, cash equivalents, and restricted cash, beginning of period1,394 2,887 3,144Cash, cash equivalents, and restricted cash, end of period$4,631 $1,394 $2,887 Supplemental Cash Flow Information Cash paid for interest$634 $696 $2,070Cash paid for income taxes65 80 50Non-cash investing and financing activities: Change in accrued capital expenditures14 (35) 46Change in assets acquired through financing activities and capital leases— — 30See accompanying Notes to Consolidated Financial Statements.58CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTSIn this filing, the name “CEC” refers to the parent holding company, Caesars Entertainment Corporation, exclusive of its consolidated subsidiaries and variableinterest entities, unless otherwise stated or the context otherwise requires. The words “Company,” “Caesars,” “Caesars Entertainment,” “we,” “our,” and “us”refer to Caesars Entertainment Corporation, inclusive of its consolidated subsidiaries and variable interest entities, unless otherwise stated or the contextotherwise requires.We also refer to (i) our Consolidated Financial Statements as our “Financial Statements,” (ii) our Consolidated Statements of Operations and ComprehensiveIncome/(Loss) as our “Statements of Operations,” and (iii) our Consolidated Balance Sheets as our “Balance Sheets.”Note 1 - Description of BusinessOrganizationCEC is primarily a holding company with no independent operations of its own. CEC owns 100% of Caesars Entertainment Resort Properties, LLC (“CERP”) andan interest in Caesars Growth Partners, LLC (“CGP”). We also consolidate the results of Caesars Interactive Entertainment, LLC (formerly Caesars InteractiveEntertainment, Inc.) (“CIE”), a wholly owned subsidiary of CGP that operates an online games business and owns the World Series of Poker (“WSOP”)tournaments and brand. CIE sold its social and mobile games business (the “SMG Business”) on September 23, 2016 , as discussed below. As ofDecember 31, 2016 , CERP and CGP owned a total of 12 casino properties in the United States, eight of which are in Las Vegas. These eight casino propertiesrepresented 65% of consolidated net revenues for the year ended December 31, 2016 .CEC also holds a majority interest in Caesars Entertainment Operating Company, Inc. (“CEOC”). The results of CEOC and its subsidiaries are no longerconsolidated with Caesars subsequent to CEOC and certain of its United States subsidiaries (the “Debtors”) voluntarily filing for reorganization under Chapter 11of the United States Bankruptcy Code (the “Bankruptcy Code”) on January 15, 2015 .Caesars Enterprise Services, LLCCaesars Enterprise Services, LLC (“CES”) is a services joint venture formed by CERP, CEOC, and a subsidiary of CGP (Caesars Growth Properties Holdings,LLC, or “CGPH”) (collectively, the “Members”). CES provides certain corporate and administrative services for the Members’ casino properties and relatedentities, including substantially all of the casino properties owned by CEOC and casinos owned by unrelated third parties. CES manages certain assets for thecasinos to which it provides services and the other assets it owns, licenses or controls, and employs certain of the corresponding employees. Under the terms of thejoint venture and the Omnibus License and Enterprise Services Agreement, CEC and its operating subsidiaries continue to have access to the services historicallyprovided to us by CEOC and its employees, its trademarks, and its programs despite the CEOC bankruptcy filing.Reportable SegmentsWe view each casino property as an operating segment and currently aggregate all such casino properties into two reportable segments based on management’sview, which aligns with their ownership and underlying credit structures: CERP and CGP.Through June 30, 2016, we aggregated the operating segments within CGP into two separate reportable segments: Caesars Growth Partners Casino Properties andDevelopments (“CGP Casinos”) and CIE. On September 23, 2016 , CIE sold the SMG Business for cash consideration of $4.4 billion (the “CIE Proceeds”) andretained only its WSOP and regulated online real money gaming businesses. The SMG Business represented the majority of CIE’s operations and was classified asdiscontinued operations for the year ended December 31, 2016 and all historical periods presented while the related assets and liabilities have been recast as heldfor sale as of December 31, 2015 (see Note 17 ). After excluding the SMG Business from CIE’s continuing operations, the remaining CIE business is not material,and we no longer consider CIE to be a separate reportable segment from CGP Casinos. Therefore, CGP Casinos and the remaining operations of CIE have beencombined for all periods presented to form the CGP segment. Additionally, CEOC remained a reportable segment until its deconsolidation effectiveJanuary 15, 2015 .Announced Merger with Caesars Acquisition CompanyIn 2014, CEC and Caesars Acquisition Company (“CAC”) entered into a merger agreement, which was amended and restated on July 9, 2016 (the “MergerAgreement”). Pursuant to the Merger Agreement, among other things, CAC will merge with and into59CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)CEC, with CEC as the surviving company (the “Merger”). Subject to the terms and conditions of the Merger Agreement, upon consummation of the Merger, eachshare of CAC common stock issued and outstanding immediately prior to the effective date of the Merger will be converted into, and become exchangeable for,shares of CEC common stock in a ratio to ensure that holders of CAC common stock receive shares equal to 27.5% of the outstanding CEC common stock on afully diluted basis (prior to the conversion of the CEC Convertible Notes being issued as part of the Restructuring, as defined below (the “Exchange Ratio”). TheExchange Ratio may be subject to change, and CEC or CAC may terminate the Merger Agreement under certain circumstances.We expect the Merger to be accounted for as a transaction among entities under common control, which will result in CAC being consolidated into Caesars at bookvalue as an equity transaction.Going ConcernAs of December 31, 2016, we adopted ASU No. 2014-15, Presentation: Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern .This guidance amended the existing requirements for disclosing information about an entity’s ability to continue as a going concern and explicitly requiresmanagement to assess an entity’s ability to continue as a going concern and to provide related footnote disclosure in certain circumstances. This guidance waseffective for annual reporting periods ending after December 15, 2016, and for annual and interim reporting periods thereafter. The following information reflectsthe results of management’s assessment of CEC’s ability to continue as a going concern.OverviewAs a result of the following circumstances, we have substantial doubt about CEC’s ability to continue as a going concern:•we have limited unrestricted cash available to meet the financial commitments of CEC, primarily resulting from significant expenditures made to (1)defend against the litigation matters disclosed below and (2) support a plan of reorganization for CEOC (the “Restructuring”);•we have made material future commitments to support the Restructuring described below; and•we are a defendant in litigation relating to certain CEOC transactions dating back to 2010 and other legal matters (see Note 2 ) that could result in one ormore adverse rulings against us if the Restructuring is not completed.CEC does not currently have sufficient cash to meet its financial commitments to support the Restructuring that are due when CEOC ultimately emerges frombankruptcy or to satisfy the potential obligations that would arise in the event of an adverse ruling on one or all of the litigation matters disclosed below. Thecompletion of the Merger is expected to allow CEC to fulfill its financial commitments in support of the Restructuring. However, if the Merger is not completedfor any reason, CEC would still be liable for many of these obligations. In addition, although under the terms of the Restructuring, all related litigation is expectedto be resolved, there remain the outstanding litigation matters that are currently stayed pending CEOC’s emergence from bankruptcy.CEC entered into the CIE Proceeds and Reservation Rights Agreement (as amended on October 7, 2016) with CIE, CEOC and CAC (the “CIE ProceedsAgreement”), which allows for up to $235 million of the proceeds from the SMG Business sale to be distributed to CEC in order to pay certain fees in support ofthe Restructuring (“CEC Expense Amounts”). After taking into account the cash available to pay the CEC Expense Amounts under the CIE Proceeds Agreementand other sources of liquidity, CEC expects to have sufficient cash to meet its ongoing obligations as they come due for at least 12 months beyond the issuancedate of these financial statements. However, there are restrictions governing when and how the cash designated for CEC Expense Amounts can be used, pursuantto the terms of the Second Lien RSA (defined below) (see Note 2 ). CEC also expects to gain access to the remaining proceeds from the sale of the SMG Businessupon completion of the Merger, which will be used to fund its other commitments in support of the Restructuring.If CEC is unable to access additional sources of cash when needed, in the event of a material adverse ruling on one or all of the litigation matters disclosed below,or if CEOC does not emerge from bankruptcy on a timely basis on terms and under circumstances satisfactory to CEC, it is likely that CEC would seekreorganization under Chapter 11 of the Bankruptcy Code.We believe that CERP and CGP’s cash and cash equivalents, their cash flows from operations, and/or financing available under their separate revolving creditfacilities will be sufficient to meet their normal operating requirements, to fund planned capital expenditures, and to fund debt service during the next 12 monthsand the foreseeable future.60CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)CEOC ReorganizationOn January 13, 2017 , the Debtors filed an amended plan of reorganization (the “Third Amended Plan”) with the United States Bankruptcy Court for the NorthernDistrict of Illinois in Chicago (the “Bankruptcy Court”) that replaces all previously filed plans. CEC, CAC, the Debtors and CEOC’s major creditor groups haveagreed to support the Third Amended Plan. The Bankruptcy Court confirmed the Third Amended Plan on January 17, 2017 .As part of the Third Amended Plan, it is anticipated that CEOC will be divided into two companies - OpCo and PropCo. OpCo will operate CEOC’s properties andfacilities. PropCo will hold certain of CEOC’s real property assets and related fixtures and will lease those assets to OpCo. It is anticipated that OpCo will be awholly owned consolidated subsidiary of CEC subsequent to the CEOC’s emergence, and that will contract with another subsidiary of CEC to manage the facilitiesto be leased from PropCo. PropCo will be a separate entity and will not be consolidated by CEC.Although the Third Amended Plan has been confirmed by the Bankruptcy Court, we must still obtain regulatory approval in all of the jurisdictions in which wehave gaming operations in order for CEOC to successfully emerge from bankruptcy, and we are unable to determine when all necessary requirements will besatisfied. In addition, the Third Amended Plan remains subject to completion of the Merger, certain financing transactions, and various other closing conditions.In connection with the Third Amended Plan, the following agreements with respect to the CEOC reorganization were either entered into or amended, as needed(collectively, the “RSAs”):(a)Sixth Amended and Restated Restructuring Support and Forbearance Agreement, dated October 4, 2016, with certain parties holding claims underCEOC’s first lien notes (the “First Lien Bond RSA”);(b)Second Amended Restructuring Support and Forbearance Agreement, dated October 4, 2016, with certain parties holding claims under CEOC’s first liencredit agreement (the “First Lien Bank RSA”);(c)Restructuring Support, Forbearance and Settlement Agreement, dated October 4, 2016, with certain parties holding claims under CEOC’s second lien noteagreements (the “Second Lien RSA”);(d)Amendment No. 1 to First Amended and Restated Restructuring Support and Forbearance Agreement, dated October 4, 2016, with certain parties holdingclaims under CEOC’s subsidiary guaranteed notes (the “SGN RSA”);(e)First Amended and Restated Restructuring Support, Settlement, and Contribution Agreement, dated July 9, 2016, with CEOC (the “CEC RSA”);(f)Amended and Restated Restructuring Support Agreement, dated July 9, 2016, with CAC and CEOC (the “CAC RSA”); and(g)Restructuring Support and Settlement Agreement, dated June 22, 2016, with the unsecured claimholders’ committee in the Chapter 11 cases (the “UCCRSA”).The “Effective Date” of the Restructuring (the material terms of which are contained in the RSAs and the Third Amended Plan) is the date upon which all requiredconditions of the Restructuring have been satisfied or waived and on which the CEOC reorganization and related transactions become effective.As a result of the Bankruptcy Court’s confirmation of the Third Amended Plan, we believe it is probable that certain obligations described in the Third AmendedPlan and the RSAs will ultimately be settled, and therefore, we have accrued the items described in the table below that are estimable in accrued restructuring andsupport expenses on the Balance Sheets. During 2016 , we updated our accruals based on the terms of the Third Amended Plan and the RSAs and recorded anadditional $5.7 billion in deconsolidation and restructuring of CEOC and other in the statement of operations, which included $426 million recorded in the fourthquarter of 2016 .We estimated the total consideration we expect to provide in support of the Restructuring, which includes a combination of cash, CEC common stock, and CECConvertible Notes. Accrued restructuring and support expenses does not include the consideration that will be issued as part of the acquisition of OpCo (as definedbelow), which will be recorded when the transaction is consummated.61CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Accrued Restructuring and Support Expenses Accrued as of(In millions)December 31, 2016 December 31, 2015Forbearance fees and other payments to creditors$970 $484Bank Guaranty Settlement734 386Issuance of CEC common shares2,936 —Issuance of CEC convertible notes1,600 —PropCo call right agreement131 —Payment of creditor expenses, settlement charges, and other fees195 —Payment to CEOC35 35Total accrued$6,601 $905The amounts disclosed above are reported net of payments totaling $34 million and $148 million during the year ended December 31, 2016 and 2015, respectively.Forbearance Fees and Other Payments to Creditors. CEC has agreed to pay certain fees in exchange for CEOC’s major creditors agreeing to forebear fromexercising their rights and remedies under certain of CEOC’s credit agreements and to stay all pending litigation.Bank Guaranty Settlement. In 2014, CEOC amended its senior secured credit facilities (the “Bank Amendment”) resulting in, among other things, a modification ofCEC’s guarantee under the senior secured credit facilities such that CEC’s guarantee was limited to a guarantee of collection (“CEC Collection Guarantee”) withrespect to obligations owed to the lenders who consented to the Bank Amendment. The CEC Collection Guarantee requires the creditors to exhaust all rights andremedies at law and in equity that the creditors or their agents may have against CEOC or any of its subsidiaries and its and their respective property to collect, orobtain payment of, the guaranteed amounts. Pursuant to the Third Amended Plan, the CEOC creditors have agreed to eliminate the CEC Collection Guarantee, andwe recorded $734 million as an estimate of the liability based on the terms of the Bank Guaranty Settlement agreement.Issuance of CEC Common Shares. CEC will issue CEC common shares for the settlement of claims and potential claims and is obligated to repurchase at least $1.0billion worth of the issued shares at a fixed price. As of December 31, 2016 , our accrual includes the $1.0 billion repurchase obligation plus the estimated fairvalue of $1.9 billion for the net shares that we expect to issue after satisfying the repurchase obligation, which is subject to remeasurement on a quarterly basis.Additionally, we have accrued a liability for the fair value associated with the creditors’ right to require CEC to repurchase up to $200 million worth of the newly-issued CEC common shares.CEC’s majority shareholders, the Sponsors (as defined in Note 18 ), have agreed that their CEC common shares shall be included as consideration in support of theRestructuring and for the settlement of claims and potential claims. Therefore, our accrual also includes the fair value of the shares held by the Sponsors. We willreduce the estimate of our obligation upon receipt of the shares from the Sponsors, with an offsetting amount recorded to equity, which is expected to occur on theEffective Date. See Note 8 for additional information on fair value measurements and how this value was determined.Issuance of CEC Convertible Notes. CEC will issue approximately $1.1 billion in face value of convertible notes (the “CEC Convertible Notes”) to the CEOCcreditors for the settlement of claims and potential claims, and our accrual represents the estimated fair value of the notes to be issued. See Note 8 .PropCo Call Right Agreement. PropCo will have a call right for up to five years to purchase the real property assets associated with Harrah’s Atlantic City andHarrah’s Laughlin from CERP and Harrah’s New Orleans from CGP (subject to the terms of the CERP and CGPH credit agreements). Our accrual represents theestimated fair value of the call right related to Harrah's Atlantic City and Harrah's Laughlin. See Note 8 . We are unable to estimate the range of loss related to theHarrah's New Orleans call right due to uncertainty regarding the negotiation of certain terms that would allow the call right to be exercised for this property.Payment of Creditor Expenses, Settlement Charges, and Other Fees. Pursuant to the Third Amended Plan, CEC has agreed to pay certain professional feesincurred by CEOC’s creditors and has agreed to pay other ancillary fees and settlement amounts.62CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Payment to CEOC . In addition, and separate from the transactions and agreements described above, because there was not a comprehensive out-of-courtrestructuring of CEOC's debt securities or a prepackaged or prearranged in-court restructuring with requisite voting support from each of the first and second liensecured creditor classes by February 15, 2016, a debt agreement entered into by CEOC in 2014 contemplates an additional payment to CEOC of $35 million fromCEC. During the first quarter of 2015, we accrued this liability in accrued restructuring and support expenses on the Balance Sheet, and this amount is currentlydue and payable. The CIE Proceeds Agreement designates a portion of the proceeds from the sale of the SMG Business for the purpose of paying this obligationupon CEOC’s emergence from bankruptcy (see Note 20 ).Other Commitments Under the Third Amended PlanThe following represents other commitments or potential obligations to which CEC has agreed as part of the Third Amended Plan and certain of the RSAs, none ofwhich have been accrued as of December 31, 2016 .Purchase 100% of OpCo common stock for $700 millionIssuance of CEC common shares in exchange for OpCo preferred stockPropCo has right of first refusal on the real property assets associated with all new domestic non-Las Vegas gaming facility opportunities, with CEC or OpColeasing such propertiesGuarantee of OpCo’s payment obligations to PropCo under the leases of the CEOC PropertiesGuarantee of OpCo debt received by the First Lien Bank Lenders and First Lien NoteholdersThe acquisitions of OpCo equity represent future investment transactions and will be recorded when (or if) the transactions are consummated. The PropCo right offirst refusal is not a financial obligation that would require accrual. The guarantees of OpCo’s payment and debt obligations relate to OpCo commitments that donot yet exist, and thus do not give rise to any obligations for CEC as of December 31, 2016 .LiquidityCaesars Entertainment is a highly-leveraged company and had $6.9 billion in consolidated debt outstanding as of December 31, 2016 . As a result, a significantportion of our liquidity needs are for debt service, including significant interest payments. As detailed in Note 11 , our consolidated estimated debt service(including principal and interest) for 2017 is $659 million and $8.8 billion thereafter to maturity. See Note 11 for details of our debt outstanding and relatedrestrictive covenants. This includes, among other information, details of our individual borrowings outstanding and each subsidiary’s annual maturities of long-term debt as of December 31, 2016 .Cash and Available Revolver Capacity December 31, 2016(In millions)CERP CGP CES OtherCash and cash equivalents$168 $1,050 $107 $188Revolver capacity270 160 — —Revolver capacity drawn or committed to letters of credit(40) — — —Total$398 $1,210 $107 $188Consolidated cash and cash equivalents, excluding restricted cash, as shown in the table above include amounts held by CERP, CGP, and CES, which are notreadily available to CEC. “Other” reflects CEC and certain of its direct subsidiaries, including its insurance captives.CEC is primarily a holding company with no independent operations, employees, or material debt issuances of its own. Its primary assets as of December 31, 2016, consist of $188 million in cash and cash equivalents and its ownership interests in CEOC, CERP and CGP. CEC’s cash includes $109 million held by itsinsurance captives. Provisions included in certain debt arrangements entered into by CERP and CGP (and/or their respective subsidiaries) substantially restrict theability of CERP, CGP, and their subsidiaries to provide dividends to CEC. In addition, CEC does not receive any financial benefit from CEOC during CEOC’sbankruptcy, as all earnings and cash flows are retained by CEOC for the benefit of its creditors.63CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)CEC has no requirement to fund the operations of CERP, CGP, or their subsidiaries. Accordingly, CEC cash outflows are primarily used for corporatedevelopment opportunities and other corporate-level activity, including defending itself in the litigation in which it has been named as a defendant (see Note 3 ). Inthe first quarter of 2016, $100 million in cash that had previously been restricted by management for use in a casino development project became available forCEC’s use in operations. In addition, as described previously, CEC is able to fund certain eligible CEC Expense Amounts from $235 million of the proceeds fromthe sale of the SMG Business. Otherwise, CEC is generally limited to raising additional capital through borrowings or equity transactions because it has nooperations of its own and the restrictions on its subsidiaries under lending arrangements generally prevent the distribution of cash from the subsidiaries to CEC,except for certain restricted payments that CERP and CGPH are authorized to make in accordance with their lending arrangements.LitigationIn addition to financial commitments described above, we have the following outstanding uncertainties for which we have not accrued any amounts, all of whichare described in Note 3 :•Litigation commenced by Wilmington Savings Fund Society, FSB on August 4, 2014 (the “Delaware Second Lien Lawsuit”);•Litigation commenced by parties on September 3, 2014 and October 2, 2014 (the “Senior Unsecured Lawsuits”);•Litigation commenced by UMB Bank on November 25, 2014 (the “Delaware First Lien Lawsuit”);•Demands for payment made by Wilmington Savings Fund Society, FSB on February 13, 2015 (the “February 13 Notice”);•Demands for payment made by BOKF, N.A., on February 18, 2015 (the “February 18 Notice”);•Litigation commenced by BOKF, N.A. on March 3, 2015 (the “New York Second Lien Lawsuit”);•Litigation commenced by UMB Bank on June 15, 2015 (the “New York First Lien Lawsuit”);•Litigation commenced by Wilmington Trust, National Association on October 20, 2015 (the “New York Senior Notes Lawsuit”); and•Litigation commenced by Trustees of the National Retirement Fund in January 2015 (the “NRF Litigation”).Report of Bankruptcy ExaminerThe Bankruptcy Court engaged an examiner to investigate possible claims CEOC might have against CEC and/or other entities and individuals. On March 15,2016, the examiner released his report, which identifies a variety of potential claims against CEC and certain individuals related to a number of transactions datingback to 2009. Most of the examiner’s findings are premised on his view that CEOC was “insolvent” at the time of the applicable transactions and that CEOC didnot receive fair value for assets transferred. The examiner’s report includes his conclusions on the relative strengths of these possible claims, many of which aredescribed in Note 3 . The examiner calculates an estimated range of potential damages for these potential claims from $3.6 billion to $5.1 billion , and suchcalculation does not account for probability of success, likelihood of collection, or the time or cost of litigation.While this report was prepared at the request of the Bankruptcy Court, none of the findings included therein are legally binding on the Bankruptcy Court or anyparty. CEC contests many of the examiner’s findings, including his findings that CEOC was insolvent at relevant times, that there were breaches of fiduciary duty,that CEOC did not receive fair value for assets transferred, that there were fraudulent transfers, and as to the calculation of damages. CEC believes that each of thechallenged transactions was undertaken to provide CEOC with the liquidity and resources required to sustain it and provide time to recover from significant marketchallenges.CEC believes that the conclusion of the examination and the release of the report was a necessary step to facilitate the settlement discussions in the CEOCbankruptcy proceedings. The Third Amended Plan and the related RSAs reflect the current status of the ongoing effort to arrive at a consensual plan providing forthe timely emergence of CEOC from bankruptcy.64CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Employee RelationsWe have approximately 31,000 employees throughout our organization. Approximately 17,000 of our employees are covered by collective bargaining agreementswith certain of our subsidiaries, relating to certain casino, hotel, and restaurant employees. The majority of these employees are covered by the followingagreements:Employee Group Approximate Number of ActiveEmployees Represented Union Date on which Collective BargainingAgreement Becomes AmendableLas Vegas Culinary Employees 8,700 Culinary Workers Union, Local 226 Various up to July 31, 2018Atlantic City Food & Beverage and Hotelemployees 1,600 UNITE HERE, Local 54 February 28, 2020Las Vegas Bartenders 1,200 Bartenders Union, Local 165 Various up to July 31, 2018Las Vegas Dealers 1,800 Transport Workers Union of Americaand UAW Various up to September 30, 2019Note 2 — Basis of Presentation and Principles of ConsolidationBasis of Presentation and Use of EstimatesOur consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), which require theuse of estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities.Actual amounts could differ from those estimates.Certain prior year amounts have been reclassified to conform to the current year’s presentation. For the years ended December 31, 2015 and 2014 , $17 million and$27 million , respectively, was reclassified from food and beverage revenues to other revenue, and $2 million and $50 million , respectively, was reclassified fromcorporate expense to depreciation and amortization.As disclosed in Note 1 , the financial results related to the SMG Business were classified as discontinued operations for all periods presented (see also Note 17 ).Consolidation of Subsidiaries and Variable Interest EntitiesOur consolidated financial statements include the accounts of Caesars Entertainment and its subsidiaries after elimination of all intercompany accounts andtransactions.We consolidate all subsidiaries in which we have a controlling financial interest and variable interest entities (“VIEs”) for which we or one of our consolidatedsubsidiaries is the primary beneficiary. Control generally equates to ownership percentage, whereby (1) affiliates that are more than 50% owned are consolidated;(2) investments in affiliates of 50% or less but greater than 20% are generally accounted for using the equity method where we have determined that we havesignificant influence over the entities; and (3) investments in affiliates of 20% or less are generally accounted for using the cost method.We consolidate a VIE when we have both the power to direct the activities that most significantly impact the results of the VIE and the right to receive benefits orthe obligation to absorb losses of the entity that could be potentially significant to the VIE. For VIEs that are under common control with affiliates, in lieu of anassessment of the power to direct the activities that most significantly impact the results of the VIE, we may be required to assess a number of other factors todetermine the consolidating entity, including the following: (i) the closeness of the association that the VIE has with the businesses of the affiliated entities, (ii) theentity from which the VIE obtained its assets; (iii) the nature of ongoing management and other agreements; and (iv) the obligation to absorb losses and the right toreceive residual returns that could potentially be significant to the VIE. Along with the VIEs that are consolidated in accordance with the above guidelines, we alsohold variable interests in other VIEs that are not consolidated because we are not the primary beneficiary. We continually monitor both consolidated andunconsolidated VIEs to determine if any events65CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)have occurred that could cause the primary beneficiary to change. A change in determination could have a material impact on our financial statements.Despite a majority financial interest, we may only possess non-substantive voting rights that do not confer upon us the ability to control key activities of the entity,such as determining operating budgets, payment of obligations, management of assets, and/or other activities necessary for the ordinary course of business. Wecontinually monitor both consolidated and unconsolidated VIEs to determine if any events have occurred that could cause the primary beneficiary to change.Consolidation of CGPBecause the equity holders in CGP receive returns disproportionate to their voting interests and substantially all the activities of CGP are related to Caesars, CGPhas been determined to be a VIE. CAC is the sole voting member of CGP. Common control exists between CAC and Caesars through the majority beneficialownership of both by Hamlet Holdings (as defined in Note 18 ). The assets held by CGP originally came from Caesars and continue to be intrinsically closelyassociated with Caesars through the nature of the business, as well as ongoing service and management agreements. Additionally, Caesars is expected to receivethe majority of the benefits or absorb the majority of the losses from its higher economic participation in CGP. We have determined that Caesars is the primarybeneficiary of CGP as a result of the close association with Caesars and other factors such as the fact that all of the assets and businesses owned by CGP wereacquired from Caesars, and therefore, we are required to consolidate them. Neither CAC nor CGP guarantees any of CEC’s debt, and the creditors or beneficialholders of CGP have no recourse to the general credit of CEC.We account for the noncontrolling interest in CGP using the hypothetical liquidation at book value (“HLBV”) method to attribute the earnings and losses of CGPbetween the controlling and noncontrolling interest. Under this method, the noncontrolling interest in the CGP entity is based upon the noncontrolling interestholders’ contractual claims on CGP’s accounting balance sheet pursuant to the mandatory liquidation provisions of the operating agreement, adjusted for certaincommon control tax distributions and the Notes Distribution described in Note 11 . Caesars’ resulting net income from the controlling interest is the residual netincome from the consolidation of the VIE less the HLBV calculated net income attributable to the noncontrolling interest holder. Due to certain mandatoryliquidation provisions of the operating agreement, this could result in a net loss to Caesars consolidated results in periods in which CGP reports net income.Subject to the terms and conditions described in the certificate of incorporation of CAC and the operating agreement of CGP, after October 21, 2016, CaesarsEntertainment has the right to acquire all or a portion of the voting units of CGP (or, at the election of CAC, shares of CAC’s Class A common stock) nototherwise owned by Caesars Entertainment at such time. The purchase consideration may be, at Caesars Entertainment’s option, cash or shares of CaesarsEntertainment’s common stock valued at market value, net of customary market discount and expenses, provided that the cash portion will not exceed 50% of thetotal consideration in any exercise of the call right. The purchase price will be the greater of (i) the fair market value of the voting units of CGP (or shares ofCAC’s Class A common stock) at such time based on an independent appraisal or (ii) the initial capital contribution in respect of such units plus a 10.5% perannum return on such capital contribution, subject to a maximum return on such capital contribution of 25% per annum, taking into account prior distributions withrespect to such units.CGP generated net revenues of $1.7 billion , $1.6 billion and $1.3 billion for the years ended December 31, 2016 , 2015 and 2014 , respectively. Net incomeattributable to Caesars related to CGP was $3.1 billion for the year ended December 31, 2016 , which was primarily related to sale of the SMG Business (seeNote 17 ). Net loss attributable to Caesars related to CGP was $18 million and $405 million for the years ended December 31, 2015 and 2014 , respectively.CGP was obligated to issue non-voting membership units to CEC in 2016 to the extent that the earnings from CIE’s social and mobile games business exceeded aspecified threshold amount as of December 31, 2015 . In April 2016, CGP issued 32 million Class B non-voting units to CEC, resulting in CEC’s economicownership in CGP increasing from 57.4% to 61.2% . However, there was no effect on our financial statements from this transaction. CEC’s economic ownership ofCGP is 61.0% as of December 31, 2016 .Our consolidated restricted cash includes amounts held by CGP of $3.0 billion and $12 million as of December 31, 2016 and 2015 , respectively. As ofDecember 31, 2016 , the majority of the balance is restricted under the terms of the CIE Proceeds Agreement, which requires a portion of the CIE Proceeds bedeposited into the CIE escrow account (the "CIE Escrow Account"). Up to $235 million may be distributed from the CIE Escrow Account only: (i) pursuant to theterms of the term sheet included in the CIE Proceeds Agreement and the agreement entered into among Wilmington Trust, National Association, CIE and CEOC,governing66CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)the CIE Escrow Account, (ii) with the joint written consent of CIE and CEOC, or (iii) pursuant to an order of a court of competent jurisdiction.CGP consolidates into its financial statements the accounts of any variable interest entity for which it is determined to be the primary beneficiary. CaesarsBaltimore Investment Company, LLC (“CBIC”) is wholly-owned and consolidated by CGP. CBIC indirectly holds interests in the CBAC Borrower, LLC(“CBAC”), owner of the Horseshoe Baltimore Casino, through its ownership interest in CR Baltimore Holdings (“CRBH”), a variable interest entity. Thecounterparty that owns the minority interest in CRBH is restricted from transferring its interest in CRBH without prior consent from CBIC. As a result, CBIC hasbeen determined to be the primary beneficiary of CRBH, and therefore, consolidates CRBH into its financial statements. Under the existing terms of theagreement, the transfer restrictions will expire in the third quarter of 2017, at which time CBIC would no longer be considered the primarily beneficiary and woulddeconsolidate CRBH. CRBH would then be accounted for as an equity method investment from that point forward.In addition to CGP, we also hold immaterial variable interests in other VIEs that are not consolidated because we are not the primary beneficiary. We continuallymonitor both consolidated and non-consolidated VIEs to determine if any events have occurred that could cause the primary beneficiary to change.Distribution of CEOC NotesIn August 2014, CGP effectuated a distribution of 100% of its remaining investment in certain CEOC notes as a dividend to its members, CEC and CAC, pro ratabased upon each member’s ownership percentage in CGP (the "Notes Distribution"). In connection with the Notes Distribution, CEC received $187 million inaggregate principal amount of CEOC’s 6.50% senior notes and $206 million in aggregate principal amount of CEOC’s 5.75% senior notes, and CAC received$138 million in aggregate principal amount of CEOC’s 6.50% senior notes and $151 million in aggregate principal amount of CEOC’s 5.75% senior notes.Because CGP is a consolidated VIE, the CEOC notes held by CGP prior to the Notes Distribution were eliminated in consolidation. The CEOC notes received byCEC were subsequently contributed to CEOC for cancellation, which resulted in no impact on the consolidated financial statements of CEC. In addition, the NotesDistribution resulted in a $160 million decrease in noncontrolling interest, which represented CGP's reported fair value of the CEOC notes at the time of the NotesDistribution.Consolidation of CESA steering committee acts in the role of a board of managers for CES with each Member entitled to appoint one representative to the steering committee. EachMember, through its representative, is entitled to a single vote on the steering committee; accordingly, the voting power of the Members does not equate to theirownership percentages. Therefore, w hen CES was formed, we determined that it was a VIE, and we concluded that CERP was required to consolidate it.Effective January 1, 2016, we implemented the Financial Accounting Standard Board’s (the “FASB”) Accounting Standard Update (“ASU”) No. 2015-02, whichamended Topic 810, Consolidations . Applying the amended guidance had no effect on our consolidated financial statements.Under the guidance in effect prior to ASU No. 2015-02, CERP was determined to be the primary beneficiary of CES, and we consolidated CES through ourconsolidation of CERP. Under the amended guidance, in determining whether an entity is the primary beneficiary of a VIE, the entity must evaluate whether it hasthe power to direct the activities of the VIE that most significantly impact the VIE’s economic performance through both its direct economic interests in the VIEand its indirect economic interests in the VIE held through related parties. Under the new criteria, when a decision maker exists that holds both power and benefitsthrough its related parties and neither related party holds such power and benefits on their own, the decision maker is determined to be the primary beneficiary.Therefore, we concluded that CEC is the primary beneficiary because our combined economic interest in CES, through our subsidiaries, represents a controllingfinancial interest.Expenses incurred by CES are allocated to the casino properties directly or to the Members according to their allocation percentages, subject to annual review.Therefore, CES is a "pass-through" entity that serves as an agent on behalf of the Members at a cost-basis, and is contractually required to fully allocate its costs.CES is designed to have no operating cash flows of its own, and any net income or loss is generally immaterial and is typically subject to allocation to theMembers in the subsequent period.67CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Consolidation Considerations for CEOCCEOC’s filing for reorganization was a reconsideration event for Caesars Entertainment to reevaluate whether consolidation of CEOC continued to be appropriate.We concluded that CEOC is a VIE and that we are not the primary beneficiary of CEOC; therefore, we no longer consolidate CEOC, but account for ourinvestment in CEOC as a cost method investment subsequent to the deconsolidation. CEOC’s ownership interest in CES was $33 million and $23 million as ofDecember 31, 2016 and December 31, 2015 , respectively, and is accounted for as noncontrolling interest.Transactions with CEOC are treated as related party transactions for Caesars Entertainment. These transactions include items such as casino management fees paidto CEOC, insurance expenses related to insurance coverage provided to CEOC by Caesars Entertainment, and rent payments by CEOC to CERP under theOctavius Tower lease agreement. See Note 18 for additional information on related party transactions and on the carrying amounts and classification of assets andliabilities that relate to our variable interest in CEOC.During the year ended December 31, 2015 , Caesars Entertainment recognized a $7.1 billion gain associated with the deconsolidation of CEOC and recorded a costmethod investment in CEOC of zero due to the negative equity associated with CEOC’s underlying financial position. For the 2015 period prior to thedeconsolidation, CEOC segment net revenues totaled $158 million , net loss attributable to Caesars totaled $76 million , and negative cash flow from operatingactivities totaled $220 million .Note 3 — LitigationLitigationNoteholder DisputesOn August 4, 2014 , Wilmington Savings Fund Society, FSB, solely in its capacity as successor Indenture Trustee for the 10.00% Second-Priority Senior SecuredNotes due 2018 (the “10.00% Second-Priority Notes”), on behalf of itself and, it alleges, derivatively on behalf of CEOC , filed a lawsuit (the “Delaware SecondLien Lawsuit”) in the Court of Chancery in the State of Delaware against CEC and CEOC, CGP, CAC,CERP, CES, Eric Hession, Gary Loveman, Jeffrey D.Benjamin, David Bonderman, Kelvin L. Davis, Marc C. Rowan, David B. Sambur, and Eric Press . The lawsuit alleges claims for breach of contract, intentionaland constructive fraudulent transfer, breach of fiduciary duty, aiding and abetting breach of fiduciary duty, and corporate waste. The lawsuit seeks (1) an award ofmoney damages; (2) to void certain transfers, the earliest of which dates back to 2010; (3) an injunction directing the recipients of the assets in these transactions toreturn them to CEOC; (4) a declaration that CEC remains liable under the parent guarantee formerly applicable to the 10.00% Second-Priority Notes; (5) to imposea constructive trust or equitable lien on the transferred assets; and (6) an award to plaintiffs for their attorneys’ fees and costs. CEC believes this lawsuit is withoutmerit and is defending itself vigorously. A motion to dismiss this action was filed by CEC and other defendants in September 2014, and the motion was argued inDecember 2014. During the pendency of its Chapter 11 bankruptcy proceedings, the action has been automatically stayed with respect to CEOC. The motion todismiss with respect to CEC was denied on March 18, 2015. In a Verified Supplemental Complaint filed on August 3, 2015, the plaintiff stated that due to CEOC’sbankruptcy filing, the continuation of all claims was stayed pursuant to the bankruptcy except for Claims II, III, and X. These are claims against CEC only, forbreach of contract in respect of the release of the parent guarantee formerly applicable to the CEOC 10.00% Second-Priority Notes, for declaratory relief in respectof the release of this guarantee, and for violations of the Trust Indenture Act in respect of the release of this guarantee. Fact discovery in the case is complete, andcross-motions for summary judgment have been filed by the parties. On January 26, 2017, the Bankruptcy Court entered an agreed order staying this proceeding(and others). The stay will remain in effect until the earlier of (a) the Effective Date, (b) the termination of the restructuring support agreement with the OfficialCommittee of Second Priority Noteholders or (c) further order of the Bankruptcy Court.On September 3, 2014 , holders of approximately $21 million of CEOC 6.50% Senior Unsecured Notes due 2016 and 5.75% Senior Unsecured Noted due 2017(collectively, the “Senior Unsecured Notes”) filed suit in federal district court in Manhattan against CEC and CEOC , claiming broadly that an August 12, 2014Note Purchase and Support Agreement between CEC and CEOC (on the one hand) and certain other holders of the Senior Unsecured Notes (on the other hand)impaired their own rights under the Trust Indenture Act of 1939 and the indentures governing the Senior Unsecured Notes. The lawsuit seeks both declaratory andmonetary relief. On October 2, 2014, a holder of CEOC’s 6.50% Senior Unsecured Notes due 2016 purporting to represent a class of all persons who held theseNotes from August 11, 2014 to the present filed a substantially similar suit in the same court, against the same defendants, relating to the same transactions. Bothlawsuits (the “Senior Unsecured Lawsuits”) were assigned to the same judge. The claims against CEOC have been automatically stayed during its Chapter 11bankruptcy proceedings. The court denied68CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)a motion to dismiss both lawsuits with respect to CEC. The parties have completed fact discovery with respect to both plaintiffs' claims against CEC. On October23, 2015, plaintiffs in the Senior Unsecured Lawsuits moved for partial summary judgment, and on December 29, 2015, those motions were denied. On December4, 2015, plaintiff in the action brought on behalf of holders of CEOC’s 6.50% Senior Unsecured Notes moved for class certification and briefing has beencompleted. The judge presiding over these cases thereafter retired, and a new judge was appointed to preside over these lawsuits. That judge set a new summaryjudgment briefing schedule, and the parties filed cross-motions for summary judgment, which remain pending. On January 26, 2017, the Bankruptcy Court enteredan agreed order staying this proceeding (and others). The stay will remain in effect until the earlier of (a) the Effective Date, (b) the termination of the restructuringsupport agreement with the Official Committee of Second Priority Noteholders or (c) further order of the Bankruptcy Court.On November 25, 2014 , UMB Bank (“UMB”), as successor indenture trustee for CEOC's 8.50% Senior Secured Notes due 2020 (the “8.50% Senior SecuredNotes”) , filed a verified complaint (the “Delaware First Lien Lawsuit”) in Delaware Chancery Court against CEC, CEOC, CERP, CAC, CGP, CES, and againstindividual past and present Board members Loveman, Benjamin, Bonderman, Davis, Press, Rowan, Sambur, Hession, Colvin, Kleisner, Swann, Williams,Housenbold, Cohen, Stauber, and Winograd , alleging generally that defendants improperly stripped CEOC of certain assets, wrongfully effected a release ofCEC’s parent guarantee of the 8.50% Senior Secured Notes and committed other wrongs . Among other things, UMB asked the court to appoint a receiver overCEOC. In addition, the suit pleads claims for fraudulent conveyances/transfers, insider preferences, illegal dividends, declaratory judgment (for breach of contractas regards to the parent guarantee and also as to certain covenants in the bond indenture), tortious interference with contract, breach of fiduciary duty, usurpation ofcorporate opportunities, and unjust enrichment, and seeks monetary, equitable and declaratory relief. The lawsuit has been automatically stayed with respect toCEOC during its Chapter 11 bankruptcy process. Pursuant to the First Lien Bond RSA, the lawsuit also has been stayed in its entirety, with the consent of all of theparties to it.On February 13, 2015, Caesars Entertainment received a Demand For Payment of Guaranteed Obligations (the “February 13 Notice”) from Wilmington SavingsFund Society, FSB, in its capacity as successor Trustee for CEOC’s 10.00% Second-Priority Notes. The February 13 Notice alleges that CEOC’s commencementof its voluntary Chapter 11 bankruptcy case constituted an event of default under the indenture governing the 10.00% Second-Priority Notes; that all amounts dueand owing on the 10.00% Second-Priority Notes therefore immediately became payable; and that Caesars Entertainment is responsible for paying CEOC’sobligations on the 10.00% Second-Priority Notes, including CEOC’s obligation to timely pay all principal, interest, and any premium due on these notes, as a resultof a parent guarantee provision contained in the indenture governing the notes that the February 13 Notice alleges is still binding. The February 13 Noticeaccordingly demands that Caesars Entertainment immediately pay Wilmington Savings Fund Society, FSB, cash in an amount of not less than $3.7 billion, plusaccrued and unpaid interest (including without limitation the $184 million interest payment due December 15, 2014 that CEOC elected not to pay) and accrued andunpaid attorneys’ fees and other expenses. The February 13 Notice also alleges that the interest, fees and expenses continue to accrue.On February 18, 2015, Caesars Entertainment received a Demand For Payment of Guaranteed Obligations (the “February 18 Notice”) from BOKF, N.A.(“BOKF”), in its capacity as successor Trustee for CEOC’s 12.75% Second-Priority Senior Secured Notes due 2018 (the “12.75% Second-Priority Notes”). TheFebruary 18 Notice alleges that CEOC’s commencement of its voluntary Chapter 11 bankruptcy case constituted an event of default under the indenture governingthe 12.75% Second-Priority Notes; that all amounts due and owing on the 12.75% Second-Priority Notes therefore immediately became payable; and that CEC isresponsible for paying CEOC’s obligations on the 12.75% Second-Priority Notes, including CEOC’s obligation to timely pay all principal, interest and anypremium due on these notes, as a result of a parent guarantee provision contained in the indenture governing the notes that the February 18 Notice alleges is stillbinding. The February 18 Notice therefore demands that CEC immediately pay BOKF cash in an amount of not less than $750 million, plus accrued and unpaidinterest, accrued and unpaid attorneys’ fees, and other expenses. The February 18 Notice also alleges that the interest, fees and expenses continue to accrue.In accordance with the terms of the applicable indentures, CEC is not subject to the above-described guarantees. As a result, we believe the demands for paymentare meritless.On March 3, 2015, BOKF filed a lawsuit (the “New York Second Lien Lawsuit”) against CEC in federal district court in Manhattan, in its capacity as successortrustee for CEOC’s 12.75% Second-Priority Notes. On June 15, 2015, UMB filed a lawsuit (the “New York First Lien Lawsuit”) against CEC, also in federaldistrict court in Manhattan, in its capacity as successor trustee for CEOC’s 11.25% Senior Secured Notes due 2017, 8.50% Senior Secured Notes due 2020, and9.00% Senior Secured Notes due 2020. Plaintiffs in these actions allege that CEOC’s filing of its voluntary Chapter 11 bankruptcy case constitutes an event ofdefault69CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)under the indentures governing these notes, causing all principal and interest to become immediately due and payable, and that CEC is obligated to make thosepayments pursuant to parent guarantee provisions in the indentures governing these notes that plaintiffs allege are still binding. Both plaintiffs bring claims forviolation of the Trust Indenture Act of 1939, breach of contract, breach of duty of good faith and fair dealing and for declaratory relief and BOKF brings anadditional claim for intentional interference with contractual relations. The cases were both assigned to the same judge presiding over the other Parent GuaranteeLawsuits (as defined below) that are taking place in Manhattan. CEC filed its answer to the BOKF complaint on March 25, 2015, and to the UMB complaint onAugust 10, 2015. On June 25, 2015, and June 26, 2015, BOKF and UMB, respectively, moved for partial summary judgment, specifically on their claims alleginga violation of the Trust Indenture Act of 1939, seeking both declaratory relief and damages. On August 27, 2015, those motions were denied. The court, on its ownmotion, certified its order with respect to the interpretation of the Trust Indenture Act for interlocutory appeal to the United States Court of Appeals for the SecondCircuit, and on December 22, 2015, the appellate court denied our motion for leave to appeal. On November 20, 2015, BOKF and UMB again moved for partialsummary judgment. These motions likewise were denied. The judge presiding over these cases thereafter retired, and a new judge was appointed to preside overthese lawsuits. That judge set a new summary judgment briefing schedule, and the parties submitted cross-motions for summary judgment, which remain pending.On January 26, 2017, the Bankruptcy Court entered an agreed order staying this proceeding (and others). The stay will remain in effect until the earlier of (a) theEffective Date, (b) the termination of the restructuring support agreement with the Official Committee of Second Priority Noteholders or (c) further order of theBankruptcy Court.On October 20, 2015, Wilmington Trust, National Association (“Wilmington Trust”), filed a lawsuit (the “New York Senior Notes Lawsuit” and, together with theDelaware Second Lien Lawsuit, the Delaware First Lien Lawsuit, the Senior Unsecured Lawsuits, the New York Second Lien Lawsuit, and the New York FirstLien Lawsuit, the “Parent Guarantee Lawsuits”) against CEC in federal district court in Manhattan in its capacity as successor indenture trustee for CEOC’s10.75% Senior Notes due 2016 (the “10.75% Senior Notes”). Plaintiff alleges that CEC is obligated to make payment of amounts due on the 10.75% Senior Notespursuant to a parent guarantee provision in the indenture governing those notes that plaintiff alleges is still in effect. Plaintiff raises claims for violations of theTrust Indenture Act of 1939, breach of contract, breach of the implied duty of good faith and fair dealing, and for declaratory judgment, and seeks monetary anddeclaratory relief. CEC filed its answer to the complaint on November 23, 2015. As with the other parent guaranty lawsuits taking place in Manhattan, the judgepresiding over these cases thereafter retired, and a new judge was appointed to preside over these lawsuits. That judge set a new summary judgment briefingschedule, and the parties submitted cross-motions for summary judgment, which remain pending. On January 26, 2017, the Bankruptcy Court entered an agreedorder staying this proceeding (and others). The stay will remain in effect until the earlier of (a) the Effective Date, (b) the termination of the restructuring supportagreement with the Official Committee of Second Priority Noteholders or (c) further order of the Bankruptcy Court.We believe that the claims and demands described above against CEC are without merit and we intend to defend the Company vigorously. The claims againstCEOC have been stayed due to the Chapter 11 process and, as described above, the actions against CEC have now also been stayed. See additional disclosurerelating to CEOC’s Chapter 11 filing in Note 1. In the event that the litigation stays are ever lifted, we believe that the Noteholder Disputes and the ParentGuarantee Lawsuits present a reasonably possible likelihood of an adverse outcome. Should these matters ultimately be resolved through litigation outside of thefinancial restructuring of CEOC (the “Financial Restructuring”), and should a court find in favor of the claimants in some or all of the Noteholder Disputes, suchdetermination would likely lead to a CEC reorganization under Chapter 11 of the Bankruptcy Code (see Note 1). We are not able to estimate a range of reasonablypossible losses should any of the Noteholder Disputes ultimately be resolved against us, although they could potentially exceed $11 billion.70CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)CEC-CAC Merger LitigationOn December 30, 2014 , Nicholas Koskie, on behalf of himself and, he alleges, all others similarly situated , filed a lawsuit (the “Merger Lawsuit”) in the ClarkCounty District Court in the State of Nevada (the “Court”) against CAC, CEC and members of the CAC board of directors Marc Beilinson, Philip Erlanger, DhirenFonseca, Don Kornstein, Karl Peterson, Marc Rowan, and David Sambur (the individual defendants collectively, the “CAC Directors”) . The Merger Lawsuitalleges claims for breach of fiduciary duty against the CAC Directors and aiding and abetting breach of fiduciary duty against CAC and CEC . It seeks (1) an orderdirecting the CAC Directors to fulfill alleged fiduciary duties to CAC in connection with the proposed merger between CAC and CEC announced on December 22,2014, specifically by announcing their intention to (a) cooperate with bona fide interested parties proposing alternative transactions, (b) ensure that no conflictsexist between the CAC Directors’ personal interests and their fiduciary duties to maximize shareholder value in the Merger, or resolve all such conflicts in favor ofthe latter, and (c) act independently to protect the interests of the shareholders; (2) an order directing the CAC Directors to account for all damages suffered or tobe suffered by plaintiff and the putative class as a result of the Merger; and (3) an award to plaintiff for his costs and attorneys’ fees. On October 13, 2016, theCourt dismissed the case for lack of prosecution. Pursuant to local rule, the case could have been reinstated at the plaintiff’s written request, provided such requestwas filed within 30 days of the date of service of written notice of the dismissal. The 30-day time period has now expired.Employee Benefit ObligationsIn December 1998, Hilton Hotels Corporation (“Hilton”) spun-off its gaming operations as Park Place Entertainment Corporation (“Park Place”). In connectionwith the spin-off, Hilton and Park Place entered into various agreements, including an Employee Benefits and Other Employment Allocation Agreement datedDecember 31, 1998 (the “Allocation Agreement”) whereby Park Place assumed or retained, as applicable, certain liabilities and excess assets, if any, related to theHilton Hotels Retirement Plan (the “Hilton Plan”) based on the benefits of Hilton employees and Park Place employees. CEOC is the ultimate successor to ParkPlace under this Allocation Agreement. In 2013, a lawsuit was settled relating to the Hilton Plan, which retroactively and prospectively increased total benefits tobe paid under the Hilton Plan. In 2009, we received a letter from Hilton, notifying us of a lawsuit related to the Hilton Plan that alleged that CEC had a potentialliability for the additional claims under the terms of the Allocation Agreement.On December 24, 2014, Hilton, the Plan Administrator of the Hilton Plan, and a representative of the Plan Administrator (the “Hilton Parties”) sued CEC andCEOC in federal court in Virginia primarily under the Employee Retirement Income Security Act (“ERISA”), and also under state contract and unjust enrichmentlaw theories, for monetary and equitable relief in connection with this ongoing dispute. On April 14, 2015, the federal court dismissed the Hilton Parties’ unjustenrichment claim with prejudice and ordered that the remainder of the case be transferred to the Bankruptcy Court based upon its relationship to the CEOCbankruptcy case.On June 9, 2016, CEC, CEOC and the Hilton Parties entered into a settlement of the Hilton Parties’ claims (the “Settlement Agreement”). Under the settlement,Hilton will receive a general unsecured claim in CEOC’s bankruptcy case for an amount equal to $51 million plus 31.75% of amounts paid by Hilton to the HiltonPlan due after July 16, 2016. For periods following the effective date of CEOC’s plan of reorganization, CEC shall assume certain of CEOC’s obligations under theAllocation Agreement. In exchange, Hilton shall turn over to CEC the distributions on account of $24.5 million of Hilton’s claim in the CEOC bankruptcy. OnJune 21, 2016, the parties sought approval of the Settlement Agreement. The CEOC Bankruptcy Court approved the Settlement Agreement on July 19, 2016. Thesettlement amount is fully accrued in liabilities subject to compromise at CEOC, and the Settlement Agreement is subject to the effectiveness of CEOC’s plan ofreorganization.National Retirement FundIn January 2015, a majority of the Trustees of the National Retirement Fund (“NRF”), a multi-employer defined benefit pension plan, voted to expel the fiveindirect subsidiaries of CEC which were required to make contributions to the legacy plan of the NRF (the “Five Employers”). The NRF contended that thefinancial condition of the Five Employers’ controlled group (the “CEC Controlled Group”) and CEOC’s then-potential bankruptcy presented an “actuarial risk” tothe plan because, depending on the outcome of any CEOC bankruptcy proceedings, CEC might no longer be liable to the plan for any partial or completewithdrawal liability. As a result, the NRF claimed that the expulsion of the Five Employers constituted a complete withdrawal of the CEC Controlled Group fromthe plan. CEOC, in its bankruptcy proceedings, has to date not rejected the contribution obligations to the NRF of any of its subsidiary employers. The NRF hasadvised the CEC Controlled Group (which includes CERP) that the expulsion71CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)of the Five Employers has triggered a joint and several withdrawal liability with a present value of approximately $360 million, payable in 80 quarterly paymentsof about $6 million.Prior to the NRF’s vote to expel the Five Employers, the Five Employers reiterated their commitments to remain in the plan and not seek rejection of any collectivebargaining agreement in which the obligation to contribute to NRF exists. The Five Employers were current with respect to pension contributions at the time oftheir expulsion, and are current with respect to pension contributions as of today pursuant to the Standstill Agreement referred to below.We have opposed the various NRF expulsion actions.On January 8, 2015, prior to the NRF’s vote to expel the Five Employers, CEC filed an action in the United States District Court for the Southern District of NewYork (the “S.D.N.Y.”) against the NRF and its Board of Trustees, seeking a declaratory judgment that they did not have the authority to expel the Five Employersand thus allegedly trigger withdrawal liability for the CEC Controlled Group (the “CEC Action”). On December 25, 2015, the District Judge entered an orderdismissing the CEC Action on the ground that CEC’s claims in this action must first be arbitrated under ERISA. CEC has appealed this decision to the UnitedStates Court of Appeals for the Second Circuit. Oral argument on this appeal was heard on January 30, 2017, and the Second Circuit has reserved decision on thisappeal.On March 6 and March 27, 2015, CEOC and certain of its subsidiaries filed in the CEOC bankruptcy proceedings two motions to void (a) the purported expulsionof the Five Employers and based thereon the alleged triggering of withdrawal liability for the non-debtor members of the CEC Controlled Group, and (b) a noticeand payment demand for quarterly payments of withdrawal liability subsequently made by the NRF to certain non-debtor members of the CEC Controlled Group,respectively, on the ground that each of these actions violated the automatic stay (the “362 Motions”). On November 12, 2015, Bankruptcy Judge Goldgar issued adecision denying the 362 Motions on the ground that the NRF’s actions were directed at non-debtors and therefore did not violate the automatic stay. CEOC hasappealed this decision to the federal district court in Chicago.On March 6, 2015, CEOC commenced an adversary proceeding against the NRF and its Board of Trustees in the Bankruptcy Court (the “Adversary Proceeding”).On March 11, 2015, CEOC filed a motion in that Adversary Proceeding to extend the automatic stay in the CEOC bankruptcy proceedings to apply to the NRF’sexpulsion of the Five Employers (the “105 Motion”). Judge Goldgar has not yet decided the 105 Motion.On March 20, 2015, CEC, CEOC and CERP, on behalf of themselves and others, entered into a Standstill Agreement with the NRF and its Board of Trustees that,among other things, stayed each member of the CEC Controlled Group’s purported obligation to commence making quarterly payments of withdrawal liability andinstead required the Five Employers to continue making monthly contribution payments to the NRF, unless and until each of the 362 Motions and the 105 Motionhad been denied. As the 105 Motion has not yet been decided, the Standstill Agreement remains in effect.If both the 105 Motion and CEC’s appeal of the CEC Action are denied, then CEC could be required to pay to the NRF joint and several withdrawal liability with apresent value of approximately $360 million, payable in 80 quarterly payments of about $6 million each while CEC simultaneously arbitrates whether the NRF andits Board of Trustees had the authority to expel the Five Employers and trigger withdrawal liability for the CEC Controlled Group.On March 18, 2015, before the Standstill Agreement was executed, the NRF and its fund manager commenced a collection action in the S.D.N.Y. against CEC,CERP and all non-debtor members of the CEC Controlled Group for the payment of the first quarterly payment of withdrawal liability, which the NRF contendedwas due on March 15, 2015 (the “NRF Action”). On December 25, 2015, the District Judge entered an Order adopting the Magistrate Judge’s recommendation todeny defendants’ motion to dismiss over the defendants’ objections on the ground that the defendants’ arguments must first be arbitrated under ERISA. OnFebruary 26, 2016, the NRF and its fund manager filed a motion for summary judgment against CEC and CERP for payment of the first quarterly payment ofwithdrawal liability and for interest, liquidated damages, attorneys’ fees and costs. On November 7, 2016, the District Judge entered an Order adopting theMagistrate Judge’s recommendation to grant partial summary judgment to the NRF Action plaintiffs over CEC and CERP’s objections on the ground that CEC andCERP’s further arguments must also first be arbitrated under ERISA. CEC and CERP filed a Notice of Appeal to protect their rights in response to this Order.Subsequently, the District Judge determined that no final order or judgment was entered, and thus the Notice of Appeal was premature. Accordingly, the partiesstipulated to the dismissal of the appeal without prejudice to any party’s rights to appeal a final, appealable judgment that may later be entered in the case.72CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)On December 5, 2016, an interlocutory judgment was entered against CEC and CERP comprising the first quarterly payment of withdrawal liability referred toabove, interest and liquidated damages under ERISA‎. On December 19, 2016, a CEC and CERP filed a motion to certify a final judgment under Rule 54(b) of theFederal Rules of Civil Procedure for immediate appeal and to stay the NRF Action plaintiffs’ motions to amend and for summary judgment, as described below.On January 11, 2017, the District Court granted the motion to certify a final judgment under Rule 54(b) in the amount of $9 million , but denied the motion for astay, and a judgment in that amount was entered the next day. CEC has appealed this decision to the Second Circuit, and has bonded the judgment pending appeal.On December 23, 2016, the NRF Action plaintiffs filed a motion to amend their complaint to add claims for the second through eighth quarterly payments ofwithdrawal liability, which the NRF Action plaintiffs contended were past due, as well as for injunctive relief requiring the defendants to pay all further quarterlypayments as they purportedly became due. Also on December 23, 2016, the NRF Action plaintiffs simultaneously filed a motion for summary judgment againstCEC and CERP for payment of the second through eighth quarterly payments of withdrawal liability, for interest, liquidated damages, attorneys’ fees and costs,and for injunctive relief requiring the defendants to pay all further quarterly payments as they purportedly became due. These motions have not yet been fullysubmitted to the District Court.We believe our legal arguments against the actions undertaken by NRF are strong and will pursue them vigorously, and will defend vigorously against the claimsraised by the NRF in the NRF Action. Since settlement discussions with the NRF are continuing and no material discovery has yet been performed with respect toany of the above actions, we cannot currently provide assurance as to the ultimate outcome of the matters at issue.Other MattersIn recent years, governmental authorities have been increasingly focused on anti-money laundering (“AML”) policies and procedures, with a particular focus onthe gaming industry. In October 2013, CEOC’s subsidiary, Desert Palace, Inc. (the owner of and referred to herein as Caesars Palace), received a letter from theFinancial Crimes Enforcement Network of the United States Department of the Treasury (“FinCEN”), stating that FinCEN was investigating Caesars Palace foralleged violations of the Bank Secrecy Act to determine whether it is appropriate to assess a civil penalty and/or take additional enforcement action against CaesarsPalace. Caesars Palace responded to FinCEN’s letter in January 2014. Additionally, we were informed in October 2013 that a federal grand jury investigationregarding anti-money laundering practices of the Company and its subsidiaries had been initiated. CEC and Caesars Palace have been cooperating with FinCEN,the Department of Justice and the Nevada Gaming Control Board (the “GCB”) on this matter. On September 8, 2015, FinCEN announced a settlement pursuant towhich Caesars Palace agreed to an $8 million civil penalty for its violations of the Bank Secrecy Act, which penalty shall be treated as a general unsecured claim inCaesars Palace’s bankruptcy proceedings. In addition, Caesars Palace agreed to conduct periodic external audits and independent testing of its AML complianceprogram, report to FinCEN on mandated improvements, adopt a rigorous training regime, and engage in a “look-back” for suspicious transactions. The terms of theFinCEN settlement were approved by the Bankruptcy Court on October 19, 2015.CEOC and the GCB reached a settlement on the same facts as above, wherein CEC agreed to pay $1.5 million and provide to the GCB the same information that isreported to FinCEN and to resubmit its updated AML policies. On September 17, 2015, the settlement agreement was approved by the Nevada GamingCommission . CEOC continues to cooperate with the Department of Justice in its investigation of this matter.Caesars is party to other ordinary and routine litigation incidental to our business. We do not expect the outcome of any such litigation to have a material effect onour consolidated financial position, results of operations, or cash flows, as we do not believe it is reasonably possible that we will incur material losses as a resultof such litigation.73CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Note 4 — Summary of Significant Accounting PoliciesAdditional accounting policy disclosures are provided within the applicable notes to the consolidated financial statements.Cash, Cash Equivalents, and Restricted CashCash equivalents are highly liquid investments with original maturities of three months or less from the date of purchase and are stated at the lower of cost ormarket value. Our cash and cash equivalents as of December 31, 2016 and 2015 , includes $1.2 billion and $948 million , respectively, held by our consolidatedVIEs, which is not available for our use to fund operations or satisfy our obligations.As of December 31, 2016 and 2015 , we had $3.1 billion and $167 million of restricted cash, respectively, comprised of current and non-current portions. Asdescribed in Note 2 , the majority of the restricted cash as of December 31, 2016 , related to sale of the SMG Business (see Note 17 ) and is restricted under theterms of the CIE Proceeds Agreement. Restricted cash also includes cash reserved under loan agreements for (a) development projects and (b) certain expendituresincurred in the normal course of business, such as interest services, real estate taxes, casualty insurance, and capital improvements; and certain other cash depositsthat are designated by management for specific purpose.In November 2016, FASB issued ASU No. 2016-18, Statement of Cash Flows: Restricted Cash , requiring that a statement of cash flows explain the change duringthe period in the total of cash, cash equivalents, and amounts generally described as restricted cash and cash equivalents. The amendments in this update areeffective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted,including adoption in an interim period. We adopted ASU No. 2016-18 for the year ended December 31, 2016, and retrospectively applied the amendments asrequired.Prior to the adopting ASU No. 2016-18, our consolidated statements of cash flows reported changes in restricted cash as investing activities and excluded restrictedcash from the beginning and ending balances of cash and cash equivalents. The effect on prior periods of adopting the new guidance includes: (i) increases in cash,cash equivalents, and restricted cash balances as of December 31, 2015, 2014, and 2013 to $1.4 billion , $2.9 billion , and $3.1 billion , respectively; and (ii)increases of $6 million and $240 million in cash flows used in investing activities for the years ended December 31, 2015 and 2014, respectively.The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported on the balance sheets that sum to amounts reported on theconsolidated statements of cash flows.(In millions)December 31, 2016 December 31, 2015Cash and cash equivalents$1,513 $1,227Restricted cash, current portion3,113 58Restricted cash, non-current portion5 109Total cash, cash equivalents, and restricted cash$4,631 $1,394ReceivablesWe issue credit to approved casino customers following investigations of creditworthiness. Business or economic conditions or other significant events could affectthe collectibility of these receivables. Accounts receivable are typically non-interest bearing and are initially recorded at cost.Marker play represents a significant portion of our overall table games volume. We maintain strict controls over the issuance of markers and aggressively pursuecollection from those customers who fail to pay their marker balances timely. These collection efforts include the mailing of statements and delinquency notices,personal contacts, the use of outside collection agencies and civil litigation. Markers are generally legally enforceable instruments in the United States. Markers arenot legally enforceable instruments in some foreign countries, but the United States’ assets of foreign customers may be reached to satisfy judgments entered in theUnited States. We consider the likelihood and difficulty of enforceability, among other factors, when we issue credit to customers who are not residents of theUnited States.Due from affiliates represents the net receivable for each counterparty relating to shared services performed on their behalf.74CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Accounts are written off when management deems the account to be uncollectible. Recoveries of accounts previously written off are recorded when received. Wereserve an estimated amount for gaming receivables that may not be collected to reduce the Company’s receivables to their net carrying amount. Methodologies forestimating the allowance for doubtful accounts range from specific reserves to various percentages applied to aged receivables. Historical collection rates areconsidered, as are customer relationships, in determining specific reserves. As with many estimates, management must make judgments about potential actions bythird parties in establishing and evaluating our reserves for allowance for doubtful accounts. Receivables are reported net of the allowance for doubtful accounts.Allowance for Doubtful Accounts(In millions)2016 2015 2014Balance as of January 1$48 $196 $162Provision for doubtful accounts11 11 50Write-offs less recoveries(18) 3 (16)CEOC deconsolidation— (162) —Balance as of December 31$41 $48 $196Revenue RecognitionProperty RevenuesCasino revenues are measured by the aggregate net difference between gaming wins and losses. Funds deposited by customers in advance and chips in thecustomers’ possession are recognized as a liability before gaming play occurs. Food and beverage, rooms, and other operating revenues are recognized whenservices are performed. Advance deposits on rooms and advance ticket sales are recorded as a deposit liability until services are provided to the customer. Salestaxes and other taxes collected from customers on behalf of governmental authorities are accounted for on a net basis and are not included in net revenues oroperating expenses.The retail value of accommodations, food and beverage, and other services furnished to guests without charge is included in gross revenues and then deducted aspromotional allowances. See Note 13 .Other RevenueOther revenue primarily includes revenue from third-party real estate leasing arrangements at our casino properties, revenue from company-operated retail stores,revenue from our entertainment venues and The High Roller observation wheel, and management fee revenue earned by CEOC through its management of third-party casino properties, until its deconsolidation in January 2015.AdvertisingThe Company expenses the production costs of advertising the first time the advertising takes place. Advertising expense was $55 million , $65 million , and $176million for the years ended December 31, 2016 , 2015 , and 2014 , respectively.Other Operating CostsOther operating costs primarily includes write-downs, reserves, and project opening costs, net of recoveries and acquisition and integration costs.75CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Note 5 — Recently Issued Accounting PronouncementsDuring 2016, we adopted the following ASUs:•No. 2014-15, Presentation: Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern ( Note 1 );•No. 2015-02, Consolidation: Amendments to the Consolidation Analysis ( Note 2 );•No. 2016-18, Statement of Cash Flows: Restricted Cash ( Note 4 ); and•No. 2016-09, Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting ( Note 14 ).The following amendments to the FASB Accounting Standards Codification are not yet effective.New DevelopmentsIntangibles - Goodwill and Other - January 2017 : Amendments in this update intend to simplify how an entity is required to test goodwill for impairment byeliminating Step 2 from the goodwill impairment test. Step 2 measures goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwillwith the carrying amount of goodwill. Under the amended guidance, an entity should perform its annual, or interim, goodwill impairment test by comparing the fairvalue of a reporting unit with its carrying amount. The elimination of Step 2 from the goodwill impairment test should reduce the cost and complexity of evaluatinggoodwill for impairment. Amendments should be applied on a prospective basis disclosing the nature of and reason for the change in accounting principle upontransition. Disclosure should be provided in the first annual period and in the interim period in which the entity initially adopts the amendments. Updatedamendments are effective for fiscal years beginning after December 15, 2019, and interim period within those fiscal years. Early adoption is permitted for interimor annual goodwill impairment tests performed on testing dates after January 1, 2017. We are currently assessing the effect the adoption of this standard will haveon our financial statements.Business Combinations - January 2017 : Updated amendments intend to clarify the definition of a business with the objective of adding guidance to assist entitieswith evaluating whether transactions should be accounted for as acquisition (or disposals) of assets or businesses. Amendments in this update provide a morerobust framework to use in determining when a set of assets and activities is a business and to provide more consistency in applying the guidance, reduce the costsof application, and make the definition of a business more operable. The amendments are effective to annual periods beginning after December 15, 2017, includinginterim periods within those periods. Early adoption is allowed as follows: (1) Transactions for which acquisition date occurs before the issuance date or effectivedate of the amendments, only when the transaction has not been reported in financial statements that have been issued or made available for issuance and (2)transactions in which a subsidiary is deconsolidated or a group of assets is derecognized that occur before the issuance date or effective date of the amendments,only when the transaction has not been reported in financial statements that have been issued or made available for issuance. We are currently assessing the effectthe adoption of this standard will have on our financial statements.Statement of Cash Flows - August 2016 : Amended guidance addresses eight specific cash flow issues with the objective of reducing diversity in how certain cashreceipts and cash payments are presented and classified in the statement of cash flows. The amendments should be applied retrospectively to each period presented.The amendments are effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted. Weare currently assessing the effect the adoption of this standard will have on our financial statements.Income Taxes - October 2016 : Amended guidance addresses intra-entity transfers of assets other than inventory, which requires the recognition of any relatedincome tax consequences when such transfers occur. The amendments should be applied on a modified retrospective basis through a cumulative-effect adjustmentdirectly to retained earnings as of the beginning of the period of adoption. Amendments are effective for fiscal years beginning after December 15, 2017, andinterim reporting periods within those years. Early adoption is permitted. We are currently assessing the impact the adoption of this standard will have on ourfinancial statements.Previously DisclosedRevenue Recognition - May 2014 (amended January 2017) : Created a new Topic 606, Revenue from Contracts with Customers. The new guidance is intended toclarify the principles for recognizing revenue and to develop a common revenue standard for United States GAAP applicable to revenue transactions. Existingindustry guidance will be eliminated, including revenue recognition guidance specific to the gaming industry. The FASB has recently issued several amendmentsto the standard, including clarification on accounting for and identifying performance obligations. This guidance is effective for annual reporting periods76CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)beginning after December 15, 2017, including interim periods within those reporting periods. The guidance should be applied using the full retrospective methodor retrospectively with the cumulative effect initially applying the guidance recognized at the date of initial application. We anticipate adopting this standardeffective January 1, 2018. We are currently in the process of our analysis and anticipate this standard will have a material effect on our consolidated financialstatements. As described below, we expect the most significant effect will be related to the accounting for the Total Rewards customer loyalty program and casinopromotional allowances. However, the quantitative effects of these changes have not yet been determined and are still being analyzed. We are currently assessingthe full effect the adoption of this standard will have on our financial statements.The Total Rewards customer loyalty program effects revenues from our four core businesses: casino entertainment, food and beverage, rooms and hotel, andentertainment and other business operations. Currently, CEC estimates the cost of fulfilling the redemption of Reward Credits, after consideration of estimatedforfeitures (referred to as “breakage”), based upon the cost of historical redemptions. Upon adoption of the new guidance, Reward Credits will no longer berecorded at cost, and a deferred revenue model will be used to account for the classification and timing of revenue recognized as well as the classification of relatedexpenses when Reward Credits are redeemed.Additionally, we expect to see a significant decrease in gaming revenues. The presentation of goods and services provided to customers without charge in grossrevenue with a corresponding reduction in promotional allowances will no longer be reported. Revenue will be recognized based on relative standalone sellingprices for transactions with more than one performance obligation.Recognition and Measurement of Financial Instruments - January 2016 : Amended certain aspects of recognition, measurement, presentation, and disclosure offinancial instruments. Among other things, they require equity investments (except those accounted for under the equity method of accounting or those that resultin consolidation) to be measured at fair value with any changes in fair value recognized in net income and simplify the impairment assessment of equityinvestments without readily determinable fair values by requiring a qualitative assessment to identify impairment. The new guidance is effective for fiscal years,and interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted on certain provisions. We are currently assessing theeffect the adoption of this standard will have on our financial statements, but do not expect the effect to be material.Leases - February 2016 (amended January 2017) : The amended guidance requires most lease obligations to be recognized as a right-of-use (“ROU”) asset with acorresponding liability on the balance sheet. The guidance also requires additional qualitative and quantitative disclosures to assess the amount, timing, anduncertainty of cash flows arising from leases. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15,2018. The guidance should be implemented for the earliest period presented using a modified retrospective approach, which includes optional practical expedientsprimarily focused on leases that commenced before the effective date, including continuing to account for leases that commenced before the effective date inaccordance with previous guidance, unless the lease is modified.Currently, all of our capital leases are set to expire before the initial effective date and will not require any accounting adjustments. Accounting for our operatingleases where we are the lessor, including leases for the Octavius Tower at Caesars Palace Las Vegas and gaming space at The LINQ promenade, will remainunchanged. Operating leases, including agreements relating to slot machines, will be recorded on the balance sheet as an ROU asset with a corresponding leaseliability, which will be amortized using the effective interest rate method as payments are made. The ROU asset will be depreciated on a straight-line basis andrecognized as lease expense. The qualitative and quantitative effects of adoption are still being analyzed. We are in the process of evaluating the full effect the newguidance will have on our financial statements.Financial Instruments-Credit Losses - June 2016 (amended January 2017) : Amended guidance replaces the incurred loss impairment methodology with amethodology that reflects expected credit losses and requires consideration of broader range of reasonable and supportable information to inform credit lossestimates. Amendments affect entities holding financial assets and net investment in leases that are not accounted for at fair value through net income. Theamendments affect loans, debt securities, trade receivables, net investments in leases, off-balance-sheet credit exposures, reinsurance receivables and any otherfinancial assets not excluded from the scope that have the contractual right to receive cash. Amendments are effective for fiscal years beginning afterDecember 15, 2019, including interim periods within those fiscal years. Early adoption is permitted. We are currently assessing the effect the adoption of thisstandard will have on our financial statements.77CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Note 6 — Property and EquipmentWe have significant capital invested in our long-lived assets, and judgments are made in determining their estimated useful lives and salvage values and if or whenan asset (or asset group) has been impaired. The accuracy of these estimates affects the amount of depreciation and amortization expense recognized in ourfinancial results and whether we have a gain or loss on the disposal of an asset. We assign lives to our assets based on our standard policy, which is established bymanagement as representative of the useful life of each category of asset.We review the carrying value of our long-lived assets whenever events and circumstances indicate that the carrying value of an asset may not be recoverable fromthe estimated future cash flows expected to result from its use and eventual disposition. As necessary, we typically estimate the fair value of assets starting with a“Replacement Cost New” approach and then deduct appropriate amounts for both functional and economic obsolescence to arrive at the fair value estimates. Otherfactors considered by management in performing this assessment may include current operating results, trends, prospects, and third-party appraisals, as well as theeffect of demand, competition, and other economic, legal, and regulatory factors. In estimating expected future cash flows for determining whether an asset isimpaired, assets are grouped at the lowest level of identifiable cash flows, which, for most of our assets, is the individual property. These analyses are sensitive tomanagement assumptions and the estimates of the obsolescence factors. Changes in these assumptions and estimates could have a material impact on the analysesand the consolidated financial statements.Additions to property and equipment are stated at cost. We capitalize the costs of improvements that extend the life of the asset. We expense maintenance andrepair costs as incurred. Gains or losses on the dispositions of property and equipment are recognized in the period of disposal. Interest expense is capitalized oninternally constructed assets at the applicable weighted-average borrowing rates of interest. Capitalization of interest ceases when the project is substantiallycomplete or construction activity is suspended for more than a brief period of time. Interest capitalized was $2 million , $12 million , and $45 million , for the yearsended December 31, 2016 , 2015 , and 2014 , respectively.Useful LivesLand improvements 12yearsBuildings20to40yearsBuilding and leasehold improvements5to20yearsFurniture, fixtures, and equipment2.5to20yearsProperty and Equipment, Net As of December 31,(In millions)2016 2015Land and land improvements$3,584 $3,584Buildings and leasehold improvements4,149 4,128Furniture, fixtures, and equipment1,346 1,307Construction in progress55 59Total property and equipment9,134 9,078Less: accumulated depreciation(1,688) (1,494)Total property and equipment, net$7,446 $7,584Depreciation Expense Years Ended December 31,(In millions)2016 2015 2014Depreciation expense$369 $301 $538Depreciation is calculated using the straight-line method over the shorter of the estimated useful life of the asset or the related lease.78CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Tangible Asset Impairments Years Ended December 31,(In millions)2016 2015 2014Continuing operations$— $1 $60In 2014, due to a decline in recent performance and downward adjustments to expectations of future performance, we performed an impairment assessment forcertain of our properties resulting in an impairment charge primarily related to a property in Reno, Nevada.Note 7 — Goodwill and Other Intangible AssetsThe purchase price of an acquisition is allocated to the underlying assets acquired and liabilities assumed based upon their estimated fair values at the date ofacquisition. We determine the estimated fair values after review and consideration of relevant information including discounted cash flows, quoted market prices,and estimates made by management. To the extent the purchase price exceeds the fair value of the net identifiable tangible and intangible assets acquired andliabilities assumed, such excess is recorded as goodwill.We perform our annual goodwill impairment assessment as of October 1. We perform this assessment more frequently if impairment indicators exist. Wedetermine the estimated fair value of each reporting unit based on a combination of earnings before interest, taxes, depreciation and amortization (“EBITDA”),valuation multiples, and estimated future cash flows discounted at rates commensurate with the capital structure and cost of capital of comparable marketparticipants, giving appropriate consideration to the prevailing borrowing rates within the casino industry in general. We also evaluate the aggregate fair value ofall of our reporting units and other non-operating assets in comparison to our aggregate debt and equity market capitalization at the test date. EBITDA multiplesand discounted cash flows are common measures used to value businesses in our industry.We perform our annual impairment assessment of other non-amortizing intangible assets as of October 1. We perform this assessment more frequently ifimpairment indicators exist. We determine the estimated fair value of our non-amortizing intangible assets by primarily using the “Relief from Royalty Method”and “Excess Earnings Method” under the income approach.The annual evaluation of goodwill and other non-amortizing intangible assets requires the use of estimates about future operating results, valuation multiples, anddiscount rates to determine their estimated fair value. Changes in these assumptions can materially affect these estimates. Thus, to the extent gaming volumesdeteriorate in the near future, discount rates increase significantly, or we do not meet our projected performance, we could have impairments to record in the futureand such impairments could be material.79CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Changes in Carrying Value of Goodwill by Segment(In millions)CEOC CERP CGP CEC TotalGross Goodwill Balance as of January 1, 2015$4,294 $3,894 $1,266 $9,454CEOC Deconsolidation(4,294) — — (4,294)SMG discontinued operation (1)— — (100) (100)Balance as of December 31, 2015— 3,894 1,166 5,060Accumulated Impairment Balance as of January 1, 2015(3,621) (2,492) (975) (7,088)CEOC Deconsolidation3,621 — — 3,621SMG discontinued operation (1)— — 15 15Balance as of December 31, 2015— (2,492) (960) (3,452)Net Carrying Value, December 31, 2015$— $1,402 $206 $1,608 Gross Goodwill Balance as of January 1, 2016$— $3,894 $1,166 $5,060Balance as of December 31, 2016— 3,894 1,166 5,060Accumulated Impairment Balance as of January 1, 2016— (2,492) (960) (3,452)Balance as of December 31, 2016— (2,492) (960) (3,452)Net Carrying Value, December 31, 2016$— $1,402 $206 $1,608____________________(1) Assets and liabilities related to the SMG Business were reclassified to assets held for sale (see Note 17 ).Changes in Carrying Value of Intangible Assets Other Than Goodwill Amortizing Non-Amortizing Total(In millions)2016 2015 2016 2015 2016 2015Balance as of January 1$350 $636 $148 $2,514 $498 $3,150Amortization expense(65) (65) — — (65) (65)CEOC Deconsolidation— (152) — (2,366) — (2,518)SMG discontinued operation (1)— (69) — — — (69)Balance as of December 31$285 $350 $148 $148 $433 $498____________________(1) Assets and liabilities related to the SMG Business were reclassified to assets held for sale (see Note 17 ).During 2014, as a result of a decline in recent performance and downward adjustments to expectations of future performance in certain of our markets, werecognized impairment charges related to goodwill, trademarks, and gaming rights for certain of our properties.80CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Intangible Asset Impairment Charges - Continuing Operations Years Ended December 31,(In millions)2016 2015 2014Goodwill$— $— $695Trademarks— — 13Gaming Rights and other— — 226Total impairment charges$— $— $934Gross Carrying Value and Accumulated Amortization of Intangible Assets Other Than Goodwill December 31, 2016 December 31, 2015(Dollars in millions)Weighted Average Remaining Useful Life (in years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying AmountAmortizing intangible assets Customer relationships4.5 $893 $(630) $263 $894 $(568) $326Contract rights8.0 3 (1) 2 3 (1) 2Gaming rights and other7.5 43 (23) 20 43 (21) 22 $939 $(654) 285 $940 $(590) 350Non-amortizing intangible assets Trademarks 126 126Gaming rights 22 22 148 148Total intangible assets other than goodwill $433 $498The aggregate amortization expense for intangible assets that continue to be amortized was $65 million in 2016 , $65 million in 2015 , and $109 million in 2014 .Estimated Five-Year Amortization Years Ended December 31,(In millions)2017 2018 2019 2020 2021Estimated annual amortization expense$65 $55 $54 $54 $48Note 8 — Fair Value MeasurementsOur assessment of goodwill and other intangible assets for impairment includes an assessment using various Level 2 (EBITDA multiples and discount rate) andLevel 3 (forecasted cash flows) inputs. See Note 7 for more information on the application of the use of fair value to measure goodwill and other intangible assets.We have not elected the fair value measurement option available under GAAP for any of our assets or liabilities that meet the criteria for this option. The followingfinancial and non-financial assets and liabilities of the Company are measured at fair value on a recurring basis.81CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Investments(In millions)Balance Level 1 Level 2 Level 3December 31, 2016 Assets: Government bonds$47 $— $47 $— December 31, 2015 Assets: Equity securities$4 $4 $— $—Government bonds67 — 67 —Total assets at fair value$71 $4 $67 $—Investments primarily consist of equity and debt securities held by our captive insurance entities that are traded in active markets, have readily determined marketvalues and have maturity dates of greater than three months from the date of purchase. These investments primarily represent collateral for several escrow and trustagreements with third-party beneficiaries and are recorded in deferred charges and other in our balance sheets while a portion is included in prepayments and othercurrent assets. As of December 31, 2016 and 2015 , gross unrealized gains and losses on marketable securities were not material.Restructuring CommitmentsEstimated Fair Value(In millions)Balance Level 1 Level 2 Level 3December 31, 2016 Accrual for consider to be issued associated with theRestructuring: CEC convertible notes$1,600 $— $— $1,600CEC common shares (1)1,936 — 1,936 —PropCo Call Right131 — — 131Total liabilities at fair value$3,667 $— $1,936 $1,731____________________(1) Includes $23 million related to the $200 million equity buyback that was reclassified from level 3 to level 2 during 2016.Changes in Level 3 Fair Value Measurements December 31, 2016(In millions) CEC ConvertibleNotes PropCo Call OptionBalance as of beginning of period $— $—Loss in deconsolidation and restructuring of CEOC and other 1,600 131Balance as of end of period $1,600 $131As described in Note 1 , we recognized certain obligations that we believe will ultimately be settled under the Third Amended Plan or the RSAs. A portion of theobligations we recognized reflect our estimates of the fair value of the consideration CEC has agreed to provide in the form of CEC Common Stock, CECConvertible Notes, and the PropCo Call Right in exchange for the settlement of litigation claims and potential claims against CEC and its affiliates. Theseobligations are recorded in accrued restructuring and support expenses on the Balance Sheets and will be accounted for at fair value each period until they areultimately settled as part of the Restructuring.82CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Valuation MethodologiesCEC Convertible Notes - We estimated the fair value of the CEC Convertible Notes to be issued using a binomial lattice valuation model that incorporates thevalue of both the straight debt and conversion features of the notes. In the Third Amended Plan, the CEC Convertible Notes have a face value of $1.1 billion , aterm of 7 years, a coupon rate of 5% , and are convertible into 13.714% of fully-diluted CEC equity. The valuation model incorporates assumptions regarding theincremental post-emergence cost of borrowing for CEC, the value of CEC’s equity into which these notes could convert, the expected volatility of such equity, andthe risk-free rate.Key Assumptions -◦Incremental cost of borrowing - 4.5%◦Expected volatility - 35%◦Risk-free rate - 2.3%Since the key assumptions used in the valuation model, including CEC’s estimated incremental post-emergence cost of borrowing and the implied volatility ofCEC’s equity, are significant unobservable inputs, the fair value for the CEC Convertible Notes is classified as Level 3. Should CEC’s estimated incremental costof borrowing or equity value fluctuate over time, it could result in an increase or decrease in the fair value of the notes and the corresponding restructuring accrual.Specifically, a decrease in the incremental borrowing rate or an increase in the implied volatility of CEC’s common stock would result in an increase in therestructuring accrual.CEC Common Stock - CEC will issue CEC common shares for the settlement of claims and potential claims and is obligated to repurchase at least $1.0 billionworth of the issued shares at a fixed price. The value of the purchase obligation is not subject to change; therefore, the estimated fair value primarily represents thenet shares that we expect to issue after satisfying the repurchase obligation. We have used the fair value of CEC’s common stock to estimate this portion of therestructuring accrual.Additionally, a portion of our accrued liability represents the fair value associated with the creditors’ right to require CEC to repurchase up to $200 million worthof the newly-issued CEC common shares. We determined the estimate fair value of this potential obligation using the Black-Scholes Option Valuation Model,which incorporates assumptions regarding the value of CEC’s equity, estimated volatility of CEC common equity, and the risk-free rate.The CEC common equity value is subject to market fluctuations and does not necessarily reflect the final value of completing the transactions contemplated in theThird Amended Plan and the related RSAs. The valuation models used to estimate the fair value of CEC’s common stock expected to be issued do not requiresignificant judgment and inputs can be observed in a liquid market, such as the current trading price and expected volatility of CEC common stock (as observedthrough the pricing of publicly-traded options of CEC’s shares). However, the valuation model includes inputs other than quoted prices in active markets, such asadjustments related to the dilutive effects of other transactions, including equity issuances in connection with the Restructuring and the Merger; therefore, thisportion of the restructuring accrual is classified as Level 2.PropCo Call Right Agreement - After the Restructuring, PropCo will have a call right for up to five years to purchase and leaseback the real property assetsassociated with Harrah’s Atlantic City and Harrah’s Laughlin from CERP and Harrah’s New Orleans from CGP for a cash purchase price of ten times the agreedupon annual rent for each property (subject to the terms of the CERP and CGPH credit agreements). The initial rent for each property under the agreement will bedetermined based on a rent-to-earnings before interest, taxes, depreciation, amortization, and rent (“EBITDAR”) ratio of 1.00-to-1.67. PropCo’s purchase price willbe determined by multiplying each property’s initial rent by 10.The valuation model used to estimate the fair value of the PropCo Call Right is a Monte Carlo simulation and utilized the following key assumptions:Key Assumptions -•Ratio of EBITDAR to Initial Rent under Property Lease - 1.67 to 1.00•EBITDAR volatility - 25%83CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)•Enterprise value to revenue volatility - 15%•Ratio of initial purchase price to property lease rent - 12.00 to 1.00•EBITDAR to multiple correlation - 0.0%•Composite projected revenue growth rate - 2.4%•Composite projected EBITDAR margin growth rate - 23.2%Since the key assumptions used in the valuation model are significant unobservable inputs, the fair value for the call right is classified as Level 3. Should theseassumptions fluctuate over time, it could result in an increase or decrease in the fair value of the call right and the corresponding restructuring accrual. Specifically,an increase in the volatility assumptions would result in an increase in the restructuring accrual. We are unable to estimate the range of loss related to the Harrah'sNew Orleans call right due to uncertainty regarding the negotiation of certain terms that would allow the call right to be exercised for this property.Derivative InstrumentsCEOC had eight interest rate swap agreements that expired, which we settled for $17 million during the first quarter of 2015. Interest expense related to thederivatives was $7 million in the first quarter of 2015. We have not entered into any additional derivative transactions since these swaps expired.Note 9 — Accrued Expenses and Other Current LiabilitiesSelf-Insurance AccrualsWe prepay CEOC for estimated employee medical insurance claims (health, dental and vision) with residual differences between estimated and actual claims beingreported in due to/from affiliates. We are self-insured for workers’ compensation and other risk products through our captive insurance subsidiaries and provideinsurance coverage to CEOC through these captives. We receive insurance premiums from CEOC on an installment basis, which are intended to cover claimsprocessed on CEOC’s behalf.Our insurance claims and reserves include accruals of estimated settlements for known claims, as well as accruals of actuarial estimates of incurred but notreported claims. In estimating these reserves, historical loss experience and judgments about the expected levels of costs per claim are considered. These claims areaccounted for based on actuarial estimates of the undiscounted claims, including those claims incurred but not reported. We believe the use of actuarial methods toaccount for these liabilities provides a consistent and effective way to measure these highly judgmental accruals. We regularly monitor the potential for changes inestimates, evaluate our insurance accruals, and adjust our recorded provisions. Self-insurance accruals are included in the table below.Detail of Accrued Expenses and Other Current Liabilities As of December 31,(In millions)2016 2015Payroll and other compensation$155 $156Self-insurance claims and reserves179 179Advance deposits87 76Payable to former Minority Investors and holders of CIE equity awards (See Note 17)63 —Accrued taxes28 30Chip and token liability20 17Other accruals132 92Total accrued expenses and other current liabilities$664 $55084CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Note 10 — LeasesWe lease both real estate and equipment used in our operations. As of December 31, 2016 , the remaining lives of our operating leases ranged from 1 to 81 years .For the years ended December 31, 2016 , 2015 , and 2014 , rent expense for operating leases was $74 million , $72 million , and $137 million , respectively. Inaddition to minimum rental commitments, certain of our operating leases provide for contingent rentals based on a percentage of revenues in excess of specifiedamounts.Future Minimum Rental Commitments(In millions)CapitalLeases OperatingLeases2017$2 $432018— 382019— 382020— 382021— 382022 and thereafter— 944Total minimum rental commitments2 $1,139Less amounts representing interest— Present value of net minimum lease payments$2 Note 11 — Debt As of December 31, 2016 2015(In millions)Face Value Book Value Book ValueCERP$4,618 $4,563 $4,627CGP2,330 2,275 2,337Total debt6,948 6,838 6,964Current portion of long-term debt(89) (89) (187)Long-term debt$6,859 $6,749 $6,777 Fair value of debt$7,190 85CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Estimated Debt Service Payments (1) Years Ended December 31,(In millions)2017 2018 2019 2020 2021 Thereafter TotalPrincipal CERP$68 $25 $25 $3,350 $1,150 $— $4,618CGP21 25 198 300 1,099 687 2,330Total principal89 50 223 3,650 2,249 687 6,948 Estimated Interest CERP390 390 400 360 130 — 1,670CGP180 190 190 160 90 40 850Total interest570 580 590 520 220 40 2,520 Principal and Interest CERP458 415 425 3,710 1,280 — 6,288CGP201 215 388 460 1,189 727 3,180Total principal and interest$659 $630 $813 $4,170 $2,469 $727 $9,468____________________(1) Debt principal payments are estimated amounts based on maturity dates and potential borrowings under our revolving credit facility. Interest payments are estimated based on theforward-looking LIBOR curve. Actual payments may differ from these estimates.Summary of Debt and Revolving Credit Facility Cash Flows from Financing Activities December 31, 2016 December 31, 2015(In millions)Proceeds Repayments Proceeds RepaymentsCERP Term Loan$— $(25) $— $(25)CERP Senior Secured Revolver105 (145) 230 (330)CGPH Term Loan— (12) — (12)CGPH Senior Secured Revolving Credit Facility15 (60) 80 (35)Horseshoe Baltimore Credit Facility— (3) — —Horseshoe Baltimore FF&E Facility— (5) — (3)Cromwell Credit Facility— (3) — (10)Other debt activity— (10) — (25)Capital lease payments— (5) — (10)Total$120 $(268) $310 $(450)Current Portion of Long-Term DebtThe current portion of long-term debt is $89 million as of December 31, 2016 . For CERP, the current portion of long-term debt is $68 million , which includes the$40 million outstanding under CERP’s revolving credit facility as well as scheduled principal payments on its senior secured loan, other unsecured borrowings, andcapitalized lease obligations that are expected to be paid within twelve months. For CGP, the current portion of long-term debt is $21 million , which includesscheduled principal payments on term loans, special improvement district bonds, and various capitalized lease obligations that are expected to be paid within 12months. There was no amount outstanding under CGP’s revolving credit facility.86CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Borrowings under the revolving credit facilities are each subject to separate note agreements executed based on the provisions of the applicable credit facilityagreements, and each note has a contractual maturity of less than one year. The applicable credit facility agreements each have a contractual maturity of greaterthan one year, and we have the ability to rollover the outstanding principal balances on a long-term basis; however, we currently intend to repay the principalbalances within the following 12 months. Amounts borrowed under the revolving credit facilities are intended to satisfy short term liquidity needs and areclassified as current.Debt Discounts and Deferred Finance ChargesDebt discounts and deferred finance charges incurred in connection with the issuance of debt are amortized to interest expense based on the related debtagreements primarily using the effective interest method. Unamortized discounts are written off and included in our gain or loss calculations to the extent weextinguish debt prior to its original maturity date.As of December 31, 2016 and 2015 , book values of debt are presented net of unamortized discounts and deferred finance charges of $110 million and $132million , respectively.Fair ValueWe calculate the fair value of debt based on borrowing rates available as of December 31, 2016 , for debt with similar terms and maturities, and based on marketquotes of our publicly traded debt. We classify the fair value of debt within level 1 and level 2 in the fair value hierarchy.CERP Debt As of December 31, 2016 2015Detail of Debt (Dollars in millions)Final Maturity Rate(s) (1) Face Value Book Value Book ValueCERP Credit Facility CERP Revolving Credit Facility (2)2018 variable $40 $40 $80CERP Term Loan (3)2020 7.00% 2,425 2,387 2,403CERP Notes CERP First Lien Notes2020 8.00% 1,000 993 992CERP Second Lien Notes2021 11.00% 1,150 1,140 1,138Capital lease obligations and otherto 2017 various 3 3 14Total CERP Debt 4,618 4,563 4,627Current portion of CERP Long-Term Debt (68) (68) (117)CERP Long-Term Debt $4,550 $4,495 $4,510____________________(1) Interest rate is fixed, except where noted.(2) Variable interest rate for amounts currently borrowed is calculated by adding LIBOR to a base rate of 6.00%.(3) Variable interest rate calculated as a fixed rate plus the greater of LIBOR or a 1% floor. The rate is set at the 1% floor as of December 31, 2016 .CERP Credit FacilityThe CERP senior secured revolving credit facility allows for borrowings in an aggregate principal amount of up to $270 million . The CERP Term Loans requirescheduled quarterly payments of $6 million , with the balance due at maturity. As of December 31, 2016 , no amounts were committed to outstanding letters ofcredit.Borrowings under the CERP revolving credit facility bear interest at the same rate elections as the CERP Term Loans. On a quarterly basis, we are required to payeach lender (i) a commitment fee in respect of any unborrowed amounts under the senior secured revolving credit facility and (ii) a letter of credit fee in respect ofthe aggregate face amount of outstanding letters of credit under the senior secured revolving credit facility. As of December 31, 2016 , the senior secured revolvingcredit facility bore a commitment fee for unborrowed amounts of 50 basis points.87CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)CGP Debt As of December 31, 2016 2015(Dollars in millions)Final Maturity Rate(s) (1) Face Value Book Value Book ValueCGPH Credit Facilities CGPH Senior Secured Revolving Credit Facility (2)2019 variable $— $— $45CGPH Senior Secured Term Loan (3)2021 6.25% 1,146 1,119 1,126CGPH Notes2022 9.38% 675 662 660Cromwell Credit Facility (4)2019 11.00% 171 167 169Horseshoe Baltimore Credit and FF&E Facilities Horseshoe Baltimore Revolving Facility Loan (5)2018 variable — — —Horseshoe Baltimore Credit Facility (4)2020 8.25% 297 287 288Horseshoe Baltimore FF&E Facility (4)(6)2019 8.75% 22 22 27Other Secured Debt2018 8.00% 5 4 4Special Improvement District Bonds2037 5.30% 14 14 14Capital lease obligations and other2016 various — — 4Total CGP Debt 2,330 2,275 2,337Current Portion of CGP Long-Term Debt (21) (21) (70)CGP Long-Term Debt $2,309 $2,254 $2,267____________________(1) Interest rate is fixed, except where noted.(2) Variable interest rate calculated as LIBOR plus 5.00%.(3) Variable interest rate calculated as a fixed rate plus the greater of LIBOR or a 1% floor. The rate is set at the 1% floor as of December 31, 2016.(4) Variable interest rate calculated as a fixed rate plus the greater of LIBOR or a 1.25% floor. The rate is set at the 1.25% floor as of December 31, 2016.(5) Variable interest rate calculated as LIBOR plus 7.00%.(6) This represents an equipment financing term loan facility.CGPH Credit FacilitiesThe CGPH senior secured revolving credit facility provides for an aggregate principal amount of up to $150 million . As of December 31, 2016 , no materialamounts were committed to outstanding letters of credit. In addition, CGPH is a holding company that owns no operating assets and has no significant operationsindependent of its subsidiaries.Horseshoe Baltimore Credit and FF&E FacilitiesAs of December 31, 2016 , the Horseshoe Baltimore Credit Facility included a senior secured revolving facility loan for an aggregate principal amount of up to $10million .The Horseshoe Baltimore FF&E Facility was used to finance or reimburse the purchase price and certain related costs of furniture, furnishings and equipment(referred to as “FF&E”) or refinance the purchase price of FF&E purchased with other funds as part of the development of the Horseshoe Baltimore casino.Terms of Outstanding DebtRestrictive CovenantsThe CERP Notes, CERP Credit Facility, CGPH Senior Secured Term Loan, CGPH Notes, Horseshoe Baltimore Credit and FF&E Facilities, and Cromwell CreditFacility all include negative covenants, subject to certain exceptions, and contain affirmative covenants and events of default, subject to exceptions, baskets andthresholds (including equity cure provisions in the case of the88CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)CERP Credit Facilities, Horseshoe Baltimore Credit and FF&E Facilities, and the Cromwell Credit Facility), all of the preceding being customary in nature.The restrictive covenants also require that we maintain Senior Secured Leverage Ratios (“SSLR”) as shown in the table below. SSLR is defined as the ratio of firstlien senior secured net debt to earnings before interest, taxes, depreciation and amortization, adjusted as defined (“Adjusted EBITDA”).Credit Facility Covenant Type Effective Period RequirementCERP Credit Facility CERP Maximum SSLR From inception 8.00to 1.00CGPH Senior Secured Term Loan CGPH Maximum SSLR From inception 6.00to 1.00Horseshoe Baltimore Credit and FF&E Facilities CBAC Maximum SSLR Q1 - Q4 2016 7.50to 1.00 CBAC Maximum SSLR Q1 - Q4 2017 6.00to 1.00 CBAC Maximum SSLR Q1 2018 and thereafter 4.75to 1.00Cromwell Credit Facility Cromwell Maximum SSLR Q2 2015 - Q1 2016 5.25to 1.00 Cromwell Maximum SSLR Q2 2016 - Q1 2017 5.00to 1.00 Cromwell Maximum SSLR Q2 2017 and thereafter 4.75to 1.00GuaranteesCERP has pledged a significant portion of its assets as collateral under the notes and facilities. The CERP Notes are co-issued, as well as fully and unconditionallyguaranteed, jointly and severally, by Caesars Entertainment Resort Properties, LLC (parent entity) and each of its wholly-owned subsidiaries on a senior securedbasis.The CGPH Senior Secured Term Loan is guaranteed by the direct parent of CGPH and certain subsidiaries of CGPH, and is secured by the direct parent’s equityinterest in CGPH and substantially all of the existing and future assets of CGPH and the subsidiary guarantors.The CGPH Notes are secured by substantially all of the existing and future property and assets of CGPH and the subsidiary guarantors (subject to exceptions), andare guaranteed by CGPH and certain subsidiaries (subject to exceptions).The Horseshoe Baltimore Credit Facility is secured by substantially all material assets of CBAC and its wholly-owned domestic subsidiaries.The Horseshoe Baltimore FF&E Facility is secured by the FF&E that was purchased with the proceeds.The Cromwell Credit Facility is secured by the assets of the Cromwell.Restricted Net AssetsBecause of the restrictions in our borrowings and other arrangements, the amount of net assets at consolidated subsidiaries not available to be remitted to CEC viadividend, loan or transfer was $4.0 billion and $2.1 billion , as of December 31, 2016 and 2015 , respectively.89CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Note 12 — Earnings Per ShareBasic earnings per share is computed by dividing the applicable income amounts by the weighted-average number of common shares outstanding. Diluted earningsper share is computed by dividing the applicable income amounts by the sum of weighted-average number of shares of common shares outstanding and dilutivepotential common shares.For periods in which Caesars generated net losses, the weighted-average basic shares outstanding was used in calculating diluted loss per share because includingdiluted shares would be anti-dilutive to loss per share.Basic and Dilutive Net Earnings Per Share Reconciliation Years Ended December 31,(In millions, except per share data)2016 2015 2014Income/(loss) from continuing operations attributable to Caesars, net of income taxes$(6,949) $5,765 $(2,640)Income/(loss) from discontinued operations attributable to Caesars, net of income taxes3,380 155 (143)Net income/(loss) attributable to Caesars$(3,569) $5,920 $(2,783) Weighted average common share outstanding146 145 142Dilutive potential common shares: Stock options— 2 —Weighted average common shares and dilutive potential common shares146 147 142 Basic earnings/(loss) per share from continuing operations$(47.52) $39.80 $(18.53)Basic earnings/(loss) per share from discontinued operations23.11 1.08 (1.00)Basic earnings/(loss) per share$(24.41) $40.88 $(19.53) Diluted earnings/(loss) per share from continuing operations$(47.52) $39.20 $(18.53)Diluted earnings/(loss) per share from discontinued operations23.11 1.06 (1.00)Diluted earnings/(loss) per share$(24.41) $40.26 $(19.53)Weighted-Average Number of Anti-Dilutive Shares Excluded from Calculation of EPS Years Ended December 31,(In millions)2016 2015 2014Stock options10 4 6Restricted stock units and awards9 1 2Total anti-dilutive common shares19 5 890CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Note 13 — Casino Promotional AllowancesThe retail value of accommodations, food and beverage, and other services furnished to guests without charge is included in gross revenues and then deducted ascasino promotional allowances. The estimated cost of providing such casino promotional allowances is included in casino expenses.Estimated Retail Value of Casino Promotional Allowances Years Ended December 31,(In millions)2016 2015 2014Food and Beverage$277 $281 $622Rooms234 234 422Other27 48 94 $538 $563 $1,138Estimated Cost of Providing Casino Promotional Allowances Years Ended December 31,(In millions)2016 2015 2014Food and Beverage$170 $169 $463Rooms82 83 168Other17 17 60 $269 $269 $691Note 14 — Stock-Based CompensationCaesars Entertainment Stock-Based Compensation PlansDuring the second quarter 2016, we implemented FASB ASU No. 2016-09, which amended Topic 718, Compensation - Stock Compensation . This updatedguidance amended the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity orliabilities, and classification on the statement of cash flows. We applied the amended guidance using a modified retrospective transition method of a cumulative-effect adjustment to beginning equity of $1 million .We maintain long-term incentive plans for management, other personnel, and key service providers. The plans allow for granting stock-based compensationawards, based on CEC common stock (NASDAQ symbol “CZR”), including time-based and performance-based stock options, restricted stock units, restrictedstock awards, stock grants, or a combination of awards.Management Equity Incentive PlanThe Harrah’s Entertainment, Inc. Management Equity Incentive Plan, as amended, (the “2008 Incentive Plan”) allowed for the granting of performance-basedoptions. The options vest and become exercisable if the return on investment in the Company of TPG Capital LP (“TPG”), Apollo Global Management, LLC(“Apollo”), and their affiliates (the “Majority Stockholders”) achieves a 2.0X return. The options vest on a pro-rata basis from zero to 100% if the MajorityStockholders achieve a return of less than 2.0 X but greater than or equal to 1.75 X. Upon the adoption of the 2012 Performance Incentive Plan, as amended, (the“2012 Incentive Plan”) options may no longer be granted under the 2008 Incentive Plan. As of December 31, 2016 , 23,755 options were outstanding under the2008 Incentive Plan and will expire between years 2018 - 2021.Performance Incentive PlanWe adopted the 2012 Incentive Plan for directors, employees, officers and consultants or advisers who render services to Caesars Entertainment or its subsidiaries.As of December 31, 2016 , a total of 30,949,468 shares of our common stock had been authorized, which is an increase of 7.5 million shares compared with theprior year end. The number of unissued common shares reserved for future grants under the long-term incentive plans was 8,331,449 as of that date.91CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)The 2012 Incentive Plan provided for a one-time stock option exchange program (the “Option Exchange”) to permit Caesars Entertainment to cancel certain stockoptions held by certain of its employees, service providers and directors in exchange for new, replacement options to purchase an equal number of shares of ourcommon stock (the “Replacement Options”).Options eligible for the Option Exchange (the “Eligible Options”) were granted on or prior to February 9, 2012, and had an exercise price equal to or greater than$20.09 per share. Replacement Options have an exercise price of $8.22 per share, a 10 -year term and a new vesting schedule determined on a grant-by-grant basis,as follows:Time-Based Options : 20% of the time-based Replacement Options were immediately vested, with the remainder vesting annually in equal amounts overfour years. All options have vested as of December 31, 2016.Performance-Based Options :•For options replacing the Eligible Options subject to vesting if funds affiliated with the Sponsors achieve at least a 1.5X return, the ReplacementOptions will vest on the date that the Caesars Entertainment’s 30-day trailing average closing common stock price equals or exceeds $35.00 pershare.•For options replacing the Eligible Options subject to vesting if funds affiliated with the Sponsors achieve at least a 2.0X return, the ReplacementOptions vest on the earlier of the following: (i) 50% on March 15, 2014 and 50% on March 15, 2015 or (ii) Caesars Entertainment’s 30-day trailingaverage closing common stock price equals or exceeds $57.41 per share. All options have vested as of December 31, 2015.Loveman Performance-Based Options : We granted 290,334 options in November 2011 to Gary Loveman, the Company’s Chairman of the Board, andformer Chief Executive Officer and President. The options were eligible to vest if funds affiliated with the Sponsors achieve at least a 1.0X return (the“Loveman Performance-Based Options”). The Replacement Options granted in exchange for the Loveman Performance-Based Options will vest on thedate that Caesars Entertainment’s 30‑day trailing average closing common stock price equals or exceeds $57.41 per share.Composition of Caesars Entertainment Stock-Based Compensation Expense Years Ended December 31,(In millions)2016 2015 2014Corporate expense$33 $57 $36Property, general, administrative, and other5 5 9Total stock-based compensation expense$38 $62 $45Caesars Entertainment Stock Option Activity Shares WeightedAverage ExercisePrice WeightedAverageRemainingContractualTerm (years) Aggregate IntrinsicValue(in millions)Outstanding as of December 31, 201510,638,219 $12.90 6.8 Exercised(11,101) 5.17 Forfeited(334,184) 13.71 Expired(472,766) 12.45 Outstanding as of December 31, 20169,820,168 $11.69 6.2 $2Vested and expected to vest as of December 31, 20169,820,168 $11.69 6.2 $2Exercisable as of December 31, 20167,361,410 $9.70 5.9 $292CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Caesars Entertainment Stock Option Grants and Exercises Years Ended December 31,(Dollars in millions, except per share data)2016 2015 2014Options Granted: Number of options granted— 1,844,332 1,500,770Weighted Average Grant-Date Fair Value per share (1)$— $3.38 $10.27Weighted Average Exercise Price per Share (1)$— $10.04 $21.18 Option Exercises: Number of options exercised11,101 58,700 317,703Cash received for options exercised (2)$— $— $3Aggregate intrinsic value of options exercised (2)$— $— $2____________________(1) Represents the weighted-average grant date fair value per option, using the Monte Carlo simulation option-pricing model for performance-based options, and the Black-Scholes option-pricing model for time-based options.(2) 2016 and 2015 amounts are immaterial.Caesars Entertainment Assumptions Used to Estimate Option Values Years Ended December 31, 2016 2015 2014Expected volatility— 42.0% 52.1%Expected dividend yield— —% —%Expected term (in years)— 5.7 5.5Risk-free interest rate— 1.6% 1.7%We utilized historical optionee behavioral data to estimate the option exercise and termination rates used in the option-pricing models. The expected term of theoptions represents the period of time the options were expected to be outstanding based on historical trends and/or derived from a numerical pricing model, such asthe Monte Carlo simulation model. Expected volatility was based on the historical volatility of the common stock of Caesars Entertainment and its competitor peergroup for a period approximating the expected life. We do not expect to pay dividends on common stock. The risk-free interest rate within the expected term wasbased on the U.S. Treasury yield curve in effect at the time of grant.Caesars Entertainment Restricted Stock Unit ActivityDuring the year ended December 31, 2016 , we granted restricted stock units (the “RSUs”) to employees of Caesars Entertainment with an aggregate fair value of$39 million . Each RSU represents the right to receive payment in respect of one share of the Caesars Entertainment’s common stock. The majority of the RSUswill vest 25% annually. The following table summarizes the activity of RSUs during the year ended December 31, 2016 . Units Wtd Avg Fair ValueOutstanding as of December 31, 20156,329,435 $12.06Granted6,101,421 6.35Vested(3,075,606) 12.78Forfeited(907,328) 9.50Outstanding as of December 31, 20168,447,922 7.95As of December 31, 2016 , there was $53 million of total unrecognized compensation cost related to Caesars Entertainment stock-based compensation plans, whichis expected to be recognized over a remaining weighted-average period of 2 years.93CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)CIE Stock-Based Compensation PlanHistorically, CIE has granted stock-based compensation awards in CIE common stock to its employees, directors, service providers and consultants in accordancewith the Caesars Interactive Entertainment, Inc. Amended and Restated Management Equity Incentive Plan, which was intended to promote the interests of CIEand its shareholders by providing key employees, directors, service providers and consultants with an incentive to encourage their continued employment orservice and improve the growth and profitability of CIE. These awards were classified as liability-based instruments and were re-measured at their fair value ateach reporting date.As described in Note 17 , in September 2016, CIE sold its SMG Business, which represented the majority of CIE’s operations, and the SMG Business is nowpresented as discontinued operations. Upon the closing of the SMG Business sale, all outstanding CIE stock-based compensation awards were deemed fully vestedand were subsequently paid in cash in connection with the closing of the SMG Business sale, as described in Note 17 . As of December 31, 2015 , the liabilityrelated to CIE’s stock-based compensation awards was $107 million , which was reported within liabilities held for sale on the Balance Sheets.The portion of CIE’s stock-based compensation expense directly identifiable with employees of the SMG Business was reclassified to discontinued operations forall periods presented in the Statements of Operations (see Note 17 ). The portion of CIE’s stock-based compensation expense not directly identifiable withemployees of the SMG Business was included in property, general, administrative, and other in the Statements of Operations. For the year endedDecember 31, 2016 , the majority of stock-based compensation expense resulted from the acceleration of the vesting of CIE stock-based compensation awards.Composition of CIE Stock-Based Compensation Expense Years Ended December 31,(In millions)2016 2015 2014Property, general, administrative, and other$189 $31 $49CIE Stock Option Activity Shares WeightedAverage ExercisePrice WeightedAverageRemainingContractualTerm (years) Aggregate IntrinsicValue(in millions)Outstanding as of December 31, 201521,057 $9,584.64 7.8 Granted377 19,166.18 Exercised(909) 2,456.64 Forfeited(248) 11,723.63 Canceled concurrent with closing of the SMG Business sale(20,277) 10,056.24 Outstanding as of December 31, 2016— $— — $—94CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)CIE Stock Option Grants and Exercises Years Ended December 31,(Dollars in millions, except per share data)2016 2015 2014Options Granted: Number of options granted377 10,350 1,135Weighted Average Grant-Date Fair Value per share (1)$5,404.93 $4,670.27 $4,717.02Weighted Average Exercise Price per Share$19,166.18 $15,352.49 $9,976.43 Option Exercises: Number of options exercised909 1,984 3,822Cash received for options exercised$2 $5 $6Aggregate intrinsic value of options exercised$13 $21 $27____________________(1) Represents the weighted-average grant date fair value per option, using the Monte Carlo simulation option-pricing model for performance-based options, and the Black-Scholes option-pricing model for time-based options. Assumptions Used to Estimate CIE Option Value Years Ended December 31, 2016 2015 2014Expected range of volatility40.5% - 44.6% 42.9% - 49.4% 46.5% - 56.8%Expected dividend yield—% —% —%Expected range of term (in years)0.8 - 4.2 1.5 - 4.7 2.4 - 7.1Risk-free interest rate range0.5% - 1.2% 0.7% - 1.7% 0.7% - 2.3%CIE Restricted Stock Unit Activity Units Wtd Avg Fair ValueOutstanding as of December 31, 20154,539 $7,827.24Granted103 16,452.14Vested(277) 11,371.30Forfeited(119) 9,543.11Canceled concurrent with closing of the SMG Business sale(4,246) 7,757.19Outstanding as of December 31, 2016— —CAC Stock-Based Compensation PlanIn April 2014, the CAC Board of Directors approved the CAC Equity-Based Compensation Plan for officers, employees, directors, individual consultants andadvisers of the Company and its subsidiaries (the “CAC Equity Plan”). Under the CAC Equity Plan, CEC is authorized to grant stock-based instruments in theform of or with a value related to CAC Class A Common Stock, par value $0.001 per share (the “CAC Common Stock”) to officers, employees, directors,individual consultants and advisers of CEC and its subsidiaries. The CAC Equity Plan will terminate ten years after approval by the Board. Subject to adjustmentsin connection with certain changes in capitalization, the maximum value of the shares of CAC Common Stock that may be delivered pursuant to awards under theCAC Equity Plan is $25 million . Upon issuance of shares pursuant to this plan, such shares will be contributed by CAC to CGP as additional investment into thatentity, at which time CGP will settle its management fee obligation with CEC and its subsidiaries through a distribution of such shares.In May 2014, CEC granted awards to officers, employees, directors, individual consultants, and advisers of CEC and its subsidiaries in accordance with the CACEquity Plan to reward and provide incentive for services provided in their capacity, promote the success of CGP, and more closely align the interests of suchindividuals with those of the stockholders of the CAC. Awards under95CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)this plan vested one-third in October 2014 with the remaining two-thirds vesting in equal portions in October 2015 and October 2016. During the years endedDecember 31, 2016 and 2015, expense associated with the vesting of such awards is recorded as stock-based compensation expense by CEC totaling $2 millionand $12 million , respectively.Note 15 — Deferred Compensation and Employee Benefit PlansDeferred CompensationDeferred Compensation PlansAs of December 31, 2016 , certain current and former employees of Caesars, and our subsidiaries and affiliates, have balances under the Harrah’s Entertainment,Inc. Executive Supplemental Savings Plan (“ESSP”), the Harrah’s Entertainment, Inc. Executive Supplemental Savings Plan II (“ESSP II”), the Park PlaceEntertainment Corporation Executive Deferred Compensation Plan, the Harrah’s Entertainment, Inc. Deferred Compensation Plan, and the Harrah’s Entertainment,Inc. Executive Deferred Compensation Plan (“EDCP”). These plans are deferred compensation plans that allow certain employees an opportunity to save forretirement and other purposes.Each of the plans is now frozen and is no longer accepting contributions. However, participants may still earn returns on existing plan balances based upon theirselected investment alternatives, which are reflected in their deferral accounts.Plan obligations in respect of all of these plans were included in Caesars’ financial statements as liabilities prior to the deconsolidation of CEOC. Caesars hasrecorded in the accompanying financial statements $40 million and $44 million in liabilities as of December 31, 2016 and December 31, 2015 , respectively,representing the estimate of its obligations under the ESSP and ESSP II and for certain former Directors and employees who had employment agreements withHarrah's Entertainment, Inc., (the predecessor to CEC) and participated in the EDCP. The additional liability in respect of the CEDCP and DCP that Caesars hasnot recorded is approximately $32 million , and $29 million as of December 31, 2016 and 2015 , respectively, as we determined that this portion of the liability wasattributable to CEOC pending the effectiveness of the settlement described below.Trust AssetsCEC is a party to a trust agreement (the “Trust Agreement”) and an escrow agreement (the “Escrow Agreement”), each structured as so-called “rabbi trust”arrangements, which hold assets that may be used to satisfy obligations under the deferred compensation plans above. Amounts held pursuant to the TrustAgreement and the Escrow Agreement were approximately $62 million and $57 million , respectively, as of December 31, 2016 , and $64 million and $49 million ,respectively, as of December 31, 2015 .The assets held pursuant to the Trust Agreement have been reflected as long-term restricted assets on the Balance Sheets. The assets held pursuant to the EscrowAgreement were not reflected on the Balance Sheets as we continued to assess the Escrow Agreement and the propriety of the funds that were contributed inaccordance with the agreement prior to reaching the settlement described below, which was not yet effective as of September 30, 2016.Settlement AgreementOn September 14, 2016, CEC entered into a settlement agreement with CEOC related to the liabilities and assets associated with the above deferredcompensation plans, which was approved by the Bankruptcy Court on October 17, 2016. Pursuant to the settlement agreement, contemporaneously with theEffective Date of the Restructuring, CEC will assume all obligations to plan participants under or with respect to all five of the deferred compensation plans, andthe Debtors will have no further obligations to the deferred compensation plan participants. At that time, CEOC and the other Debtors will relinquish and releaseany claim or right that any of them may have in respect of the assets held under either the Trust Agreement or the Escrow Agreement. Upon the effectiveness of theRestructuring and CEC’s receipt of the assets held pursuant to the Escrow Agreement, CEC will record the additional assets and liabilities in respect of the CEDCPand DCP and Escrow Agreement, which are $57 million and $32 million , respectively, as of December 31, 2016 .96CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Savings and Retirement PlansWe maintain a defined contribution savings and retirement plan that allows employees to make pre-tax and after-tax contributions. Under the plan, participatingemployees may elect to contribute up to 50% of their eligible earnings (subject to IRS rules and regulations) and are eligible to receive a company match of up to$600 . Participating employees become vested in matching contributions on a pro-rata basis over five years of credited service. Our contribution expense for thisplan was $6 million , $6 million , and $13 million for the years ended December 31, 2016 , 2015 , and 2014 , respectively.Multiemployer Pension PlanThe Company contributes to a number of multiemployer defined benefit pension plans under the terms of collective-bargaining agreements that cover its union-represented employees. The risks of participating in these multiemployer plans are different from a single-employer plan in the following aspects:a.Assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers.b.If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers.c.If the Company chooses to stop participating in some of its multiemployer plans, the Company may be required to pay those plans an amount based on theunderfunding of the plan, referred to as a “withdrawal liability.”Multi-employer Pension Plan Participation Pension Protection ActZone Status (1) Contributions(In millions) Pension Fund EIN/Pension PlanNumber 2016 2015 FIP/RPStatus (2) 2016 2015 2014 SurchargeImposed Expiration Date ofCollective-BargainingAgreement (6)Southern Nevada Culinary andBartenders Pension Plan (5) 88-6016617/001 Green Green No $16 $16 $18 No Various up to July 31, 2018Pension Plan of the UNITE HERENational Retirement Fund (3)(5) 13-6130178/001 Red Red Yes 5 6 14 No Various up to February 29, 2020Local 68 Engineers Union PensionPlan (4)(5) 51-0176618/001 Yellow Green No — — 1 No April 30, 2017NJ Carpenters Pension Fund 22-6174423/001 Yellow Yellow Yes — — — No April 30, 2017Painters IUPAT 52-6073909/001 Yellow Yellow Yes 1 1 1 No Various up to June 30, 2021 Other Funds 11 9 12 Total Contributions $33 $32 $46 ____________________(1) Represents the Pension Protection Act zone status for applicable plan year beginning January 1, except where noted otherwise. The zone status is based on information that the Companyreceived from the plan administrator and is certified by the plan’s actuary. Among other factors, plans in the red zone are generally less than 65% funded, plans in the yellow zone arebetween 65% and less than 80% funded, and plans in the green zone are at least 80% funded. All plans detailed in the table above utilized extended amortization provisions to calculatezone status.(2) Indicates plans for which a financial improvement plan (“FIP”) or a rehabilitation plan (“RP”) is either pending or has been implemented.(3) As described in Note 3 , in January 2015, the Pension Plan of the UNITE HERE National Retirement Fund voted to expel Caesars Entertainment and its participating subsidiaries from theplan.(4) Plan years begin July 1.(5) Plan was listed in the pension plans’ Forms 5500 as providing more than 5% of the total contributions for the plan years ended 2015 and 2014 . At the date the financial statements wereissued, Forms 5500 were not available for the 2016 plan year ending.(6) The terms of the current agreement continue indefinitely until either party provides appropriate notice of intent to terminate the contract.97CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Note 16 — Income TaxesThe effect on the income tax provision and deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes theenactment date. We have provided a valuation allowance on certain federal, foreign, and state net operating losses (“NOLs”), and other federal, state, and foreigndeferred tax assets. NOLs and other federal, state, and foreign deferred tax assets were not deemed realizable based upon near term estimates of future taxableincome.We classify reserves for tax uncertainties within accrued expenses and deferred credits and other in our balance sheets, separate from any related income taxpayable, which is also reported within accrued expenses, or deferred income taxes. Reserve amounts relate to any potential income tax liabilities resulting fromuncertain tax positions, as well as potential interest or penalties associated with those liabilities.We file income tax returns, including returns for our subsidiaries, with federal, state, and foreign jurisdictions, except for CGP, which is filed as part of a separatetax filing group. We are under regular and recurring audit by the Internal Revenue Service (“IRS”) and various state taxing authorities on open tax positions, and itis possible that the amount of the liability for unrecognized tax benefits could change during the next 12 months.Components of Income/(Loss) Before Income Taxes from Continuing OperationsYears Ended December 31,(In millions)2016 2015 2014United States$(6,098) $5,780 $(3,331)Outside of the U.S.(2) (2) 12 $(6,100) $5,778 $(3,319)Income Tax Benefit/(Provision) Years Ended December 31,(In millions)2016 2015 2014United States Current Federal$(2) $— $—State— — 110Deferred Federal(33) 128 601State7 (10) (109)Outside of the U.S. Current1 1 (5)Deferred— — (1) $(27) $119 $596Allocation of Income Tax Benefit/(Provision) Years Ended December 31,(In millions)2016 2015 2014Income tax benefit/(provision) applicable to: Income/(loss) from continuing operations$(27) $119 $596Discontinued operations(730) (64) (32)Accumulated other comprehensive income/(loss)— — (16)Deconsolidation and restructuring of CEOC and other— 1,176 —Additional paid-in capital— — (15)98CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Effective Income Tax Rate Reconciliation Years Ended December 31, 2016 2015 2014Statutory tax rate35.0 % 35.0 % 35.0 %Increases/(decreases) in tax resulting from: State taxes, net of federal tax benefit— — 1.6Valuation allowance(22.5) 3.5 (5.7)Foreign income taxes— — 0.1Goodwill— — (9.1)Deconsolidation of CEOC— (40.1) —Stock-based compensation(0.8) 0.2 (0.5)Acquisition and integration costs— — (0.4)Reserves for uncertain tax positions— — 0.3Sale of stock of subsidiary— — (0.5)Disallowed losses on sale to related party— — (3.8)Nondeductible restructuring expenses(16.8) — —Noncontrolling interests4.8 (0.7) 0.9Other(0.1) — 0.1Effective tax rate(0.4)% (2.1)% 18.0 %99CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Temporary Differences Resulting in Deferred Tax Assets and Liabilities As of December 31,(In millions)2016 2015Deferred tax assets: State net operating losses$3 $5Federal net operating loss51 44Compensation programs42 52Allowance for doubtful accounts17 10Self-insurance reserves7 7Accrued restructuring and support expenses1,278 317Accrued expenses27 6Federal tax credits17 13Federal indirect tax benefits of uncertain state tax positions4 —Investment in CGP LLC— 115Capital loss carryover— 15Deferred revenue1 1Other8 7Subtotal1,455 592Less: valuation allowance949 205Total deferred tax assets$506 $387Deferred tax liabilities: Depreciation and other property-related items914 921Deferred cancellation of debt income and other debt-related items98 152Investment in CGP LLC211 —Investment in non-consolidated affiliates909 170Intangibles87 134Prepaid expenses9 10Total deferred tax liabilities2,228 1,387Net deferred tax liability$1,722 $1,000As of December 31, 2016 and 2015 , we had federal NOL carryforwards of $152 million and $134 million , respectively. These net operating losses are differentfrom the net operating losses that are reflected in our federal and certain state tax returns as they do not include net operating losses that are attributable to ourdeconsolidated subsidiary, CEOC. These NOLs will begin to expire in 2031. In addition, we had federal general business tax credits and research tax creditcarryforwards of $17 million , which will begin to expire in 2029. We believe that it is more likely than not that the benefit from the federal NOL and tax creditcarryforwards for the CEC tax consolidated group will not be realized. As a result, a valuation allowance has been established for our federal NOL carryforwardsand tax credits carryforwards deferred tax assets as of December 31, 2016 .NOL carryforwards for our domestic subsidiaries for state income taxes were $70 million and $85 million as of December 31, 2016 and 2015 , respectively. Webelieve that it is more likely than not that the benefit from certain state NOL carryforwards will not be realized. Accordingly, we have provided a full valuationallowance on the deferred tax assets relating to these NOL carryforwards which will not more likely than not be realized. These state NOLs will begin to expire in2034.100CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Reconciliation of Unrecognized Tax Benefits Years Ended December 31,(In millions)2016 2015 2014Balance as of beginning of year$3 $81 $142Additions based on tax positions related to the current year19 — 20Additions for tax positions of prior years— — —Reductions for tax positions for prior years(1) — (1)Deconsolidation of CEOC— (78) —Settlements— — —Expiration of statutes— — (80)Balance as of end of year$21 $3 $81We classify reserves for tax uncertainties within accrued expenses and deferred credits and other in our balance sheets, separate from any related income taxpayable or deferred income taxes. Reserve amounts relate to any potential income tax liabilities resulting from uncertain tax positions as well as potential interestor penalties associated with those liabilities.We accrue interest and penalties related to unrecognized tax benefits in income tax expense. During 2016, we increased our accrual by $3 million . There was nochange to our accrual during 2015 . We reduced our accrual by $62 million during 2014 . There was an accrual for the payment of interest and penalties of $3million as of December 31, 2016 . There was no accrual for the payment of interest and penalties as of December 31, 2015 , and $1 million was accrued as ofDecember 31, 2014 . Included in the balances of unrecognized tax benefits as of December 31, 2016 and 2014 , was approximately $15 million and $48 million ,respectively, of unrecognized tax benefits that, if recognized, would impact the effective tax rate. There were no unrecognized tax benefits as of December 31, 2015 that, if recognized, would impact the effective tax rate.We file income tax returns, including returns for our subsidiaries, with federal, state, and foreign jurisdictions. We are subject to exam by various state and foreigntax authorities. As of December 31, 2016 , the tax years prior to 2012 are not subject to examination for U.S. tax purposes. As of December 31, 2016 , the tax yearsprior to 2012 are no longer subject to examination for most of the foreign and state income tax jurisdictions as the statutes of limitations have lapsed.We believe that it is reasonably possible that the unrecognized tax benefits liability will not materially change within the next 12 months. Audit outcomes and thetiming of audit settlements are subject to significant uncertainty. Although we believe that adequate provision has been made for such issues, there is the possibilitythat the ultimate resolution of such issues could have an adverse effect on our earnings. Conversely, if these issues are resolved favorably in the future, the relatedprovision would be reduced, thus having a favorable impact on earnings.Note 17 — Discontinued OperationsSale of SMG BusinessOn September 23, 2016 , CIE sold its SMG Business to Alpha Frontier Limited (“Alpha Frontier”) for cash consideration of $4.4 billion , subject to customarypurchase price adjustments, pursuant to the Stock Purchase Agreement dated as of July 30, 2016 (the "Purchase Agreement"), which resulted in a pre-tax gain ofapproximately $4.2 billion .As a result of the sale, CAC incurred estimated current income tax expense of approximately $285 million on the gain. Under the terms of its operating agreement,CGP is required to distribute $285 million to CAC, which CAC will use to pay its tax obligation resulting from the sale of the SMG Business (see Note 18 ).Additionally, $264 million was deposited into an escrow account to fund potential indemnity claims of Alpha Frontier under the Purchase Agreement (the"Indemnity Escrow"), of which $5 million was paid to Alpha Frontier during the fourth quarter of 2016 upon finalization of the purchase price adjustment pursuantto the Purchase Agreement, leaving a remaining balance of $259 million as of December 31, 2016 . There were no indemnity claims made.The majority of the proceeds from the sale of the SMG Business is restricted under the terms of the Purchase Agreement and the CIE Proceeds Agreement and wastherefore classified as restricted cash as of December 31, 2016 . As a result of the sale, the results of operations and cash flows related to the SMG Business wereclassified as discontinued operations for the year ended101CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)December 31, 2016 , and the historical results have been recast as discontinued operations for the years ended December 31, 2015 and 2014 . The related assetsand liabilities have been recast as held for sale as of December 31, 2015 .In connection with the closing of the SMG Business sale (“Closing”), CIE completed the following transactions, which were funded from the proceeds of the sale:•Repurchased all of the shares of CIE common stock held by Rock Gaming Interactive LLC, and its other minority investors (collectively, the "MinorityInvestors") in exchange for the right to receive cash payments representing the fair market value of the shares of CIE common stock at Closing.•Accelerated the vesting of all of the outstanding options, restricted stock units and warrants of CIE (collectively, "CIE equity awards") and canceled allsuch CIE equity awards in exchange for the right to receive cash payments equal to the intrinsic value of such awards.The total amount distributed to the Minority Investors and former holders of CIE equity awards in connection with Closing was approximately $1.1 billion , whichis subject to any purchase price adjustments pursuant to the Purchase Agreement. As of December 31, 2016 , CGP has accrued $63 million for the estimatedportion of the balance remaining in the Indemnity Escrow that is due to the Minority Investors and former holders of CIE equity awards. The balance is included inaccrued expenses and other current liabilities on the Balance Sheets. The remaining CIE Proceeds will be released from the Indemnity Escrow at the end of theescrow period, which is 12 months from the date of the Closing.Assets and liabilities held for sale in the Balance Sheets are related to the SMG Business.Carrying Amount of Major Classes of Assets and Liabilities of Discontinued Operations(In millions)December 31, 2015Cash, cash equivalents, and restricted cash$112Receivables, prepayments, and other current assets64Property and equipment, net14Goodwill and other intangible assets133Deferred taxes, deferred charges, and other long-term assets41Total assets held for sale$364 Accounts payable$17Accrued expenses and other current liabilities40Deferred taxes, deferred credits, and other long-term liabilities9Total liabilities held for sale$66102CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)The Statements of Operations for each year in the three-year period ended December 31, 2016 also includes discontinued operations related to certain propertiesowned by CEOC, which was deconsolidated effective January 15, 2015 (see Note 2 ).Effect on Statements of Operations of Discontinued Operations Years Ended December 31,(In millions)2016 2015 2014Net revenues SMG Business$678 $725 $549Showboat Atlantic City— — 115Harrah’s Tunica— — 46Other— — 2Total net revenues678 725 712 Operating expenses SMG Business (1)748 499 447Showboat Atlantic City— 6 174Harrah’s Tunica— — 166Other— 1 36Total operating expenses748 506 823 Gain from discontinued operations SMG Business4,180 — — Pre-tax income/(loss) from operations SMG Business4,110 226 102Showboat Atlantic City— (6) (59)Harrah’s Tunica— — (120)Other— (1) (34)Total pre-tax income/(loss) from discontinued operations$4,110 $219 $(111) Income/(loss), net of income taxes SMG Business$3,380 $162 $49Showboat Atlantic City— (6) (38)Harrah’s Tunica— — (120)Other— (1) (34)Total income/(loss) from discontinued operations, net of income taxes$3,380 $155 $(143) Tangible and intangible asset impairments Showboat Atlantic City$— $— $10Harrah’s Tunica— — 68Other— — 17Total impairments from discontinued operations$— $— $95____________________(1) Operating expenses primarily consist of platform fees and property, general, administrative, and other expenses, including stock-based compensation expense directly identifiable withemployees of the SMG Business of $264 million , $29 million , and $38 million for the years ended December 31, 2016 , 2015 , and 2014 , respectively.103CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Showboat Atlantic CityCEOC closed its Showboat Atlantic City casino permanently effective in 2014 and subsequently sold it in 2015 for $18 million . In 2014, we accrued severanceand other exit costs totaling $26 million and recognized a tangible asset impairment of $10 million . The liability for exit costs was derecognized when CEOC wasdeconsolidated in 2015.Harrah’s TunicaCEOC closed its Harrah’s Tunica casino permanently effective in 2014 and recorded intangible and tangible asset impairment charges totaling $68 million andaccrued exit costs of $16 million associated with the closure of this casino. The liability for exit costs was derecognized when CEOC was deconsolidated in 2015.Note 18 — Related Party Transactions Years ended December 31,(In millions)2016 2015 2014Transactions with Sponsors and their affiliates Reimbursements and expenses$6 $20 $2Expenses paid to Sponsors’ portfolio companies2 3 9Expenses paid on behalf of CAC315 36 32Transactions with CEOC Shared services allocated expenses to CEOC368 355 —Shared services allocated expenses from CEOC148 117 —Management fees incurred45 40 —Octavius Tower lease revenue35 34 —Other expenses incurred14 12 —Transactions Related to the CEOC ReorganizationThe Debtors filed the Third Amended Plan on January 13, 2017 , and CEC, CAC, the Debtors, and CEOC’s major creditor groups have agreed to support the ThirdAmended Plan and have entered into various RSAs with respect to the CEOC reorganization. See detailed discussion of the Third Amended Plan and the RSAs inNote 1 .Transactions with Sponsors and their AffiliatesThe members of Hamlet Holdings LLC (“Hamlet Holdings”) are comprised of individuals affiliated with Apollo and affiliates of TPG (collectively, the“Sponsors”). As of December 31, 2016 , Hamlet Holdings beneficially owned a majority of CEC’s common stock pursuant to an irrevocable proxy providingHamlet Holdings with sole voting and sole dispositive power over those shares, and, as a result, the Sponsors have the power to elect all of CEC’s directors.Reimbursements and ExpensesCEC has a services agreement with the Sponsors relating to the provision of financial and strategic advisory services and consulting services. The Sponsors havegranted an ongoing waiver of the monitoring fees for management services; however, we reimburse the Sponsors for expenses they incur related to thesemanagement services and certain legal expenses. The reimbursed expenses are included in corporate expense and are included in the table above.Sponsors’ Portfolio CompaniesWe have entered into agreements with a number of companies that are portfolio companies of our Sponsors. The following are the Sponsor portfolio companieswith which we have business relationships:•XOJet, Inc. - provides access to aircraft at contractually agreed upon hourly rates.104CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)•SunGard Availability Service LP - provides enterprise cloud services and solutions for managed information technology.•Sabre, Inc. - provides technology to assist our customers with booking hotel rooms.•Avaya Inc. - supplies technology products and services and related software licenses and support.•Norwegian Cruise Line Holdings Ltd. - a cruise ship operations company with which we have a marketing agreement pursuant to which, among otherthings, NCL pays Caesars Entertainment a percentage of its gaming revenue.•Classic Party Rentals - provides party rental supplies.•Creative Artists Agency LLC , - we have entered into multiple entertainment agreements in connection with artists’ performances at Caesars’ properties.•Fleet Pride, Inc. - provides aftermarket heavy-duty truck and trailer parts.•Sutherland Global Services - technology and analytics enabled business process enterprise that provides end-to-end business process transformation.•Sbarro, LLC, - pizzeria chain that specializes in New York style pizza by the slice and other Italian-American cuisine.•Protection One - full service security provider.•ADT Security Services, Inc. - provides electronic security, fire protection, and other related alarm monitoring services.Amounts paid to the Sponsors’ portfolio companies are included in the table above and we believe such transactions are conducted at fair value.In addition, certain entities affiliated with or under the control of our Sponsors may from time to time transact in and hold our debt securities, and participate in anymodifications of such instruments on terms available to any other holder of our debt.Caesars Acquisition CompanyAs described in Note 2 , CAC is the sole voting member of CGP, our consolidated VIE, and common control exists between CAC and Caesars through themajority beneficial ownership of both by Hamlet Holdings. Pursuant to the operating agreement of CGP, CGP pays certain expenses on behalf of CAC. Theseexpenses, which are included in the table above, commenced in 2013 and are reflected as distributions to a noncontrolling interest holder in the consolidatedstatements of equity. The year ended December 31, 2016 includes $285 million related to CAC’s estimated current income tax expense on the gain on sale of theSMG Business. Under its operating agreement, CGP is required to distribute funds to CAC that will be used to pay CAC’s tax obligation resulting from the sale.During the fourth quarter of 2016, CGP made tax payments of $240 million related to the sale of the SMG Business.Transactions with CEOCAs described in Note 2 , upon its filing for reorganization under Chapter 11 of the Bankruptcy Code and its subsequent deconsolidation, transactions with CEOCare no longer eliminated in consolidation and are considered related party transactions for Caesars. A summary of these transactions is provided in the table above.CEOC Shared Services AgreementPursuant to a shared services agreement, CEOC provides Caesars with certain corporate and administrative services, and the costs of these services are allocated toCaesars. Certain services are now provided by CES (see Note 1 ).Prior to the deconsolidation of CEOC, we were self-insured for employee medical (health, dental, and vision) and risk products, including workers compensationand surety bonds, and our insurance claims and reserves included accruals of estimated settlements for known claims, as well as accruals of actuarial estimates ofincurred but not reported claims.105CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)We continue to be self-insured for workers compensation and other risk insurance as of December 31, 2016 . Caesars Entertainment provides insurance coverage toCEOC and receives insurance premiums on an installment basis, which are intended to cover claims processed on CEOC’s behalf. We prepay CEOC for estimatedemployee medical insurance claims.Services Joint VentureCES provides certain corporate and administrative services to its Members, and the costs of these services are allocated among the Members. Accordingly, CERPand CGP are allocated 21.8% and 12.8% , respectively, and CEOC reimburses CES for its allocated costs. The CES allocated costs include amounts for insurancecoverage (see Note 1 ).Management FeesIn 2014, CEOC sold to CGP, among other things, four properties (The Cromwell, The LINQ Hotel, Bally’s Las Vegas, and Harrah’s New Orleans), relatedintellectual property, and 50% of certain ongoing management fees. Under the terms of the agreements governing this transaction, each property remained undermanagement by CEOC, until CEOC assigned the management agreements to CES. CEOC continues to receive ongoing management fees during the term of therelated property management agreement consisting of a (i) base management fee of 2% of monthly net operating revenues and (ii) an incentive management fee inan amount equal to 5% of EBITDA for each operating year. Each property also licenses enterprise-wide intellectual property from CLC. The agreements governingthis transaction also provide that CEC and CEOC will indemnify CGP LLC for the failure of CEC and CEOC to perform or fulfill any of their covenants or breachany of their representations and warranties under the agreements among other agreed upon matters.Octavius Tower Lease AgreementUnder the Octavius Tower lease agreement, CEOC leases the Octavius Tower at Caesars Palace Las Vegas from CERP and pays rent totaling $35 million annuallythrough expiration in April 2026.LINQ Access and Parking Easement Lease AgreementUnder the LINQ Access and Parking Easement lease agreement, CEOC leases the parking lot behind The LINQ promenade and The LINQ Hotel to CERP andCGP. Together, CERP and CGP pay approximately $2 million annually, subject to a 3% annual increase through expiration in April 2028. Amounts are includedwithin other expenses incurred in the table above.Service Provider FeeCEOC, CERP and CGP have a shared services agreement under which CERP and CGP pay for certain indirect corporate support costs. CEOC is authorized tocharge CERP and CGP for an amount equal to 21.8% and 12.8% , respectively, of unallocated corporate support costs. Amounts are included within otherexpenses incurred in the table above.Cross Marketing and Trademark License AgreementCIE and CEOC have a Cross Marketing and Trademark License Agreement in effect until December 31, 2026, unless terminated earlier pursuant to the terms ofthe agreement. The agreement grants CIE the exclusive right to use various brands of Caesars Entertainment in connection with social and mobile games andonline real money gaming in exchange for a 3% royalty. This agreement also provides for cross-marketing and promotional activities between CIE and CEOC,including participation by CIE in Caesars’ Total Rewards loyalty program. CEOC also receives a revenue share from CIE for customer referrals. Amounts areincluded within other expenses incurred in the table above.Effective upon Closing, CIE and Playtika, formerly a wholly-owned subsidiary of CIE and now a wholly-owned subsidiary of the buyer of the SMG Business,executed a separate sub-license agreement extending substantially the same rights and obligations to both parties beyond the sale through December 31, 2026.Equity Incentive AwardsCaesars maintains an equity incentive awards plan under which CEC may issue time-based and performance-based stock options, restricted stock units andrestricted stock awards to CEOC employees. Although awards under the plan result in the issuance of shares of CEC, because CEOC is no longer a consolidatedsubsidiary of CEC, we have accounted for these awards as nonemployee awards subsequent to the date of deconsolidation.106CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Employee Benefit PlansCEC maintains a defined contribution savings and retirement plan in which employees of CEOC may participate. The plan provides for, among other things, pre-tax and after-tax contributions by employees. Under the plan, participating employees may elect to contribute up to 50% of their eligible earnings (subject tocertain IRS and plan limits). In addition, employees subject to collective bargaining agreements receive benefits through the multi-employer pension planssponsored by the organization in which they are a member. The expenses related to contributions made to the plans on their behalf are allocated to the properties atwhich they are employed.Total Rewards Loyalty ProgramCEOC’s customer loyalty program, Total Rewards, offers incentives to customers from their spending related to on-property entertainment expenses, includinggaming, hotel, dining, and retail shopping at our and CEOC’s resort properties located in the U.S. and Canada. Under the program, customers are able toaccumulate, or bank, Reward Credits over time that they may redeem at their discretion under the terms of the program. The Reward Credit balance will beforfeited if the customer does not earn a Reward Credit over the prior six-month period. As a result of the ability of the customer to bank the Reward Credits,CEOC estimates the cost of fulfilling the redemption of Reward Credits, after consideration of estimated forfeitures (referred to as “breakage”) based upon the costof historical redemptions. The estimated value of Reward Credits is expensed as the Reward Credits are earned by customers and is included in direct casinoexpense. The total estimated cost is accrued by CEOC, with the incremental charges related to our casino properties included in due to affiliates, net in the BalanceSheets.Due from/to AffiliatesAmounts due to or from affiliates for each counterparty represent the net receivable or payable as of the end of the reporting period primarily resulting from thetransactions described above and are settled on a net basis by each counterparty in accordance with the legal and contractual restrictions governing transactions byand among Caesars’ consolidated entities and CEOC. The amount due from CEOC represents the maximum exposure to loss as a result of Caesars’ involvementwith CEOC, and the amount is reported net of an allowance for doubtful accounts of $12 million .As of December 31, 2016 and 2015 , due from affiliates was $64 million and $34 million , respectively, and represented a receivable due to CES from CEOC forshared services performed on behalf of CEOC.As of December 31, 2016 and 2015 , due to affiliates was $112 million and $16 million , respectively, and represented a payable due to CEOC primarily from CGPfor shared services performed on their behalf.Note 19 — Segment ReportingWe view each casino property and CIE as operating segments and currently aggregate all such casino properties into two reportable segments based onmanagement’s view of these properties, which aligns with their ownership and underlying credit structures: CERP and CGP. Through June 30, 2016, we presentedCGP as two separate reportable segments: CGP Casinos and CIE. Subsequent to the sale of the SMG Business (see Note 1) the remaining CIE business is notmaterial. Therefore, we no longer consider CIE to be a separate reportable segment, and CGP Casinos and CIE have been combined for all periods presented as theCGP segment. Additionally, CEOC was a reportable segment until its deconsolidation effective January 15, 2015.The results of each reportable segment presented below are consistent with the way Caesars management assesses these results and allocates resources, which is aconsolidated view that adjusts for the impact of certain transactions between reportable segments within Caesars, as described below. Accordingly, the results ofcertain reportable segments presented in this filing differ from the financial statement information presented in their standalone filings.“Other” includes parent, consolidating, and other adjustments to reconcile to consolidated Caesars results.107CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Condensed Statements of Operations - By Segment Year Ended December 31, 2016(In millions)CERP CGP Other Elimination CECOther revenues$325 $217 $4 $(19) $527Net revenues2,195 1,697 4 (19) 3,877Depreciation and amortization258 180 1 — 439Income/(loss) from operations389 20 (152) — 257Interest expense(396) (198) (5) — (599)Deconsolidation and restructuring of CEOC and other— 2 (5,760) — (5,758)Income tax benefit/(provision) from continuing operations4 1 (32) — (27) Year Ended December 31, 2015(In millions)CEOC CERP CGP Other Elimination CECOther revenues$12 $307 $182 $26 $(32) $495Net revenues164 2,154 1,620 26 (35) 3,929Depreciation and amortization13 210 151 — — 374Impairment of tangible and other intangible assets— — 1 — — 1Income/(loss) from operations9 411 253 (328) 1 346Interest expense(87) (399) (195) (4) 2 (683)Deconsolidation and restructuring of CEOC and other— — 4 6,113 (2) 6,115Income tax benefit/(provision) from continuing operations— (5) 2 122 — 119 Year Ended December 31, 2014(In millions)CEOC (1) CERP CGP Other Elimination CECOther revenues$337 $316 $175 $101 $(187) $742Net revenues4,812 2,065 1,319 101 (330) 7,967Depreciation and amortization341 200 115 3 (1) 658Impairment of goodwill251 289 155 — — 695Impairment of tangible and other intangible assets308 (12) 3 — — 299Income/(loss) from operations(323) (32) (221) 14 7 (555)Interest expense(2,184) (389) (169) (17) 90 (2,669)Deconsolidation and restructuring of CEOC and other(100) — 132 (30) (97) (95)Income tax benefit/(provision) from continuing operations264 28 231 73 — 596____________________(1) Includes foreign net revenues of $337 million .Property EBITDA - by SegmentProperty earnings before interest, taxes, depreciation and amortization (“EBITDA”) is presented as a measure of the Company’s performance. Property EBITDA isdefined as revenues less property operating expenses and is comprised of net income/(loss) before (i) interest expense, net of interest capitalized and interestincome, (ii) income tax (benefit)/provision, (iii) depreciation and amortization, (iv) corporate expenses, and (v) certain items that we do not consider indicative ofits ongoing operating performance at an operating property level. As a result of the sale of the SMG Business (see Note 17 ), we have determined that CIE stock-based compensation expense should be excluded from Property EBITDA as management no longer considers such expense to be indicative of CaesarsEntertainment’s ongoing consolidated or segment operating performance. Therefore, Property EBITDA has been recast for prior periods to be consistent to thecurrent year presentation.108CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)In the future, we may incur expenses that are the same or similar to some of the adjustments in this presentation. The presentation of Property EBITDA should notbe construed as an inference that future results will be unaffected by unusual or unexpected items.Property EBITDA is a non-GAAP financial measure commonly used in our industry and should not be construed as an alternative to net income/(loss) as anindicator of operating performance or as an alternative to cash flow provided by operating activities as a measure of liquidity (as determined in accordance withGAAP). Property EBITDA may not be comparable to similarly titled measures reported by other companies within the industry. Property EBITDA is includedbecause management uses Property EBITDA to measure performance and allocate resources, and believes that Property EBITDA provides investors withadditional information consistent with that used by management. Year Ended December 31, 2016(In millions)CERP CGP Other Elimination CECNet income/(loss) attributable to company$(3) $3,953 $(7,519) $— $(3,569)Net income/(loss) attributable to noncontrolling interests— (28) 850 — 822Discontinued operations, net of income taxes— (4,100) 720 — (3,380)Income tax (benefit)/provision(4) (1) 32 — 27Deconsolidation and restructuring of CEOC and other— (2) 5,760 — 5,758Interest expense396 198 5 — 599Depreciation and amortization258 180 1 — 439Corporate expense43 29 96 (2) 166Other operating costs7 21 61 — 89CIE stock-based compensation— 189 — — 189Property EBITDA$697 $439 $6 $(2) $1,140 Year Ended December 31, 2015(In millions)CEOC CERP CGP Other Elimination CECNet income/(loss) attributable to company$(85) $7 $220 $5,777 $1 $5,920Net income/(loss) attributable to noncontrolling interests— — 6 126 — 132Discontinued operations, net of income taxes7 — (162) — — (155)Income tax (benefit)/provision— 5 (2) (122) — (119)Deconsolidation and restructuring of CEOC and other— — (4) (6,113) 2 (6,115)Interest expense87 399 195 4 (2) 683Depreciation and amortization13 210 151 — — 374Impairment of tangible and other intangible assets— — 1 — — 1Corporate expense5 47 39 95 (12) 174Other operating costs4 4 (105) 249 — 152CIE stock-based compensation— — 31 — — 31Property EBITDA$31 $672 $370 $16 $(11) $1,078109CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Year Ended December 31, 2014(In millions)CEOC CERP CGP Other Elimination CECNet income/(loss) attributable to company$(2,524) $(393) $39 $95 $— $(2,783)Net income/(loss) attributable to noncontrolling interests8 — (33) (58) — (83)Discontinued operations, net of income taxes173 — (33) 3 — 143Income tax (benefit)/provision(264) (28) (231) (73) — (596)Deconsolidation and restructuring of CEOC and other100 — (132) 30 97 95Interest expense2,184 389 169 17 (90) 2,669Depreciation and amortization341 200 115 3 (1) 658Impairment of goodwill251 289 155 — — 695Impairment of tangible and other intangible assets308 (12) 3 — — 299Corporate expense139 60 23 13 (3) 232Other operating costs106 15 111 (24) (5) 203CIE stock-based compensation— — 49 — — 49Property EBITDA$822 $520 $235 $6 $(2) $1,581Condensed Balance Sheets - By Segment As of December 31, 2016(In millions)CERP CGP Other Elimination CECTotal assets$6,941 $7,353 $1,246 $(646) $14,894Total liabilities5,903 2,709 7,758 (58) 16,312 As of December 31, 2015(In millions)CERP CGP Other Elimination CECTotal assets$7,028 $4,518 $1,409 $(749) $12,206Total liabilities6,073 2,798 $1,157 (55) 9,973Note 20 — Subsequent EventsAmendment to the CGP Operating AgreementOn February 13, 2017 , CEC, CAC and certain subsidiaries of CEC (the "CEC Members") entered into the third amendment to the CGP Operating Agreement to,among other things, (a) provide for the tax treatment of the allocations of net profits and net losses of the capital accounts of CGP regarding certain non-pro ratadistributions made to CAC and the CEC Members pursuant to the CGP Operating Agreement, as amended on September 23, 2016 and October 7, 2016 and by thethird amendment referred to herein (together with such amendments, the "CGP Operating Agreement") and (b) permit a $35 million special distribution to the CECMembers to satisfy certain payment obligations as set forth in the CIE Proceeds Agreement (see “Payment to CEOC” in Note 1 ). The foregoing description of thethird amendment to the CGP Operating Agreement does not purport to be complete and is qualified in its entirety by reference to the third amendment to the CGPOperating Agreement, which is filed as Exhibit 10.93 hereto and incorporated herein by reference.110CAESARS ENTERTAINMENT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Note 21 — Quarterly Results of Operations (Unaudited)(In millions, except per share amounts)First Quarter Second Quarter Third Quarter Fourth Quarter Total2016 Net revenues$950 $992 $986 $949 $3,877Income/(loss) from operations88 111 (44) 102 257Net income/(loss)(274) (2,043) 5 (435) (2,747)Net loss attributable to Caesars(308) (2,077) (643) (541) (3,569)Basic loss per share(2.12) (14.25) (4.38) (3.68) (24.41)Diluted loss per share(2.12) (14.25) (4.38) (3.68) (24.41) 2015 Net revenues$1,085 $966 $957 $921 $3,929Income from operations93 128 84 41 346Net income/(loss)6,797 50 (756) (39) 6,052Net income/(loss) attributable to Caesars6,772 15 (791) (76) 5,920Basic earnings/(loss) per share46.81 0.10 (5.44) (0.54) 40.88Diluted earnings/(loss) per share46.12 0.10 (5.44) (0.54) 40.26As described in Note 1 , during 2016, we significantly increased our accrual for restructuring commitments beginning in the first quarter, and our accrual wasupdated quarterly. In addition, as described in Note 17 , during the third quarter of 2016, CIE sold its SMG Business, which resulted in a pre-tax gain ofapproximately $4.2 billion .During the year ended December 31, 2015 , Caesars Entertainment recognized a $7.1 billion gain associated with the deconsolidation of CEOC. See Note 2 .111ITEM 9.Changes in and Disagreements with Accountants on Accounting and Financial DisclosureNone.ITEM 9A.Controls and Proceduresa.Disclosure Controls and ProceduresWe maintain disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed in reports filed under theExchange Act is recorded, processed, summarized, and reported within the specified time periods and accumulated and communicated to our management,including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosures.Our management, with the participation of our CEO and CFO, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e)or 15d-15(e) promulgated under the Exchange Act) as of December 31, 2016. Based on these evaluations, our CEO and CFO concluded that our disclosure controlsand procedures required by paragraph (b) of Rules 13a-15 or 15d-15 were effective as of December 31, 2016, at a reasonable assurance level.b.Management’s Report on Internal Control Over Financial ReportingOur management is responsible for establishing and maintaining effective internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f)under the Exchange Act. This system is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidatedfinancial statements for external purposes in accordance with U.S. GAAP. Because of the inherent limitations of internal control over financial reporting, includingthe possibility of collusion or improper management override of controls, misstatements due to error or fraud may not be prevented or detected on a timely basis.Our management performed an assessment of the effectiveness of our internal control over financial reporting as of December 31, 2016, utilizing the criteriadiscussed in the “Internal Control - Integrated Framework (2013)” issued by the Committee of Sponsoring Organizations of the Treadway Commission. Theobjective of this assessment was to determine whether our internal control over financial reporting was effective as of December 31, 2016. Based on management'sassessment, we have concluded that our internal control over financial reporting was effective as of December 31, 2016.The effectiveness of our internal control over financial reporting has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, asstated in its report, which is included herein.c.Changes in Internal Control over Financial ReportingWe have commenced several transformation initiatives, including implementing new general ledger software to automate and simplify our business processes.These are long-term initiatives that we believe will enhance our internal control over financial reporting due to increased automation and integration of relatedprocesses. We will continue to monitor and evaluate our internal control over financial reporting throughout the transformation.There have not been any other changes in our internal control over financial reporting during the three months ended December 31, 2016, that have materiallyaffected, or are reasonably likely to materially affect, our internal control over financial reporting.112REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMTo the Board of Directors and Stockholders ofCaesars Entertainment Corporation:We have audited the internal control over financial reporting of Caesars Entertainment Corporation and subsidiaries (the "Company") as of December 31, 2016,based on the criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the TreadwayCommission. The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of theeffectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over FinancialReporting. Our responsibility is to express an opinion on the Company's internal control over financial reporting based on our audit.We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that weplan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in thecircumstances. We believe that our audit provides a reasonable basis for our opinion.A company's internal control over financial reporting is a process designed by, or under the supervision of, the company's principal executive and principalfinancial officers, or persons performing similar functions, and effected by the company's board of directors, management, and other personnel to providereasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receiptsand expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on thefinancial statements.Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls,material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of theinternal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or thatthe degree of compliance with the policies or procedures may deteriorate.In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2016, based on the criteriaestablished in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated financial statementsand financial statement schedule as of and for the year ended December 31, 2016 of the Company and our report dated February 14, 2017 expressed an unqualifiedopinion on those financial statements and financial statement schedule and included an emphasis of a matter paragraph regarding the Company’s majority ownedsubsidiary, Caesars Entertainment Operating Company, Inc. (CEOC) and certain of its U.S. subsidiaries filing for reorganization under Chapter 11 of theBankruptcy Code, which resulted in the Company deconsolidating CEOC effective January 15, 2015; and an explanatory paragraph regarding uncertainties thatraise substantial doubt about the ability of the Company to continue as a going concern./s/ DELOITTE & TOUCHE LLPLas Vegas, NevadaFebruary 14, 2017113ITEM 9B.Other InformationAmendment to the CGP Operating AgreementOn February 13, 2017 , CEC, CAC and certain subsidiaries of CEC (the "CEC Members") entered into the third amendment to the CGP Operating Agreement to,among other things, (a) provide for the tax treatment of the allocations of net profits and net losses of the capital accounts of CGP regarding certain non-pro ratadistributions made to CAC and the CEC Members pursuant to the CGP Operating Agreement, as amended on September 23, 2016 and October 7, 2016 and by thethird amendment referred to herein (together with such amendments, the "CGP Operating Agreement") and (b) permit a $35 million special distribution to the CECMembers to satisfy certain payment obligations as set forth in the CIE Proceeds Agreement (see “Payment to CEOC” in Note 1 ). The foregoing description of thethird amendment to the CGP Operating Agreement does not purport to be complete and is qualified in its entirety by reference to the third amendment to the CGPOperating Agreement, which is filed as Exhibit 10.93 hereto and incorporated herein by reference.114PART IIIITEM 10.Directors, Executive Officers, and Corporate Governance.We incorporate by reference the information regarding executive officers included in Item 1 of this report and appearing under the captions “Executive Officers,”“Corporate Governance - Section 16(a) Beneficial Ownership Reporting Compliance” and “Corporate Governance - Code of Ethics” in our definitive ProxyStatement for our 2017 Annual Meeting of Stockholders, which we expect to file with the Securities and Exchange Commission on or about April 5, 2017 (the“Proxy Statement”).ITEM 11.Executive Compensation.We incorporate by reference the information appearing under the captions “Executive Compensation” and “Corporate Governance - Human Resources CommitteeInterlocks and Insider Participation” in the Proxy Statement.ITEM 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.We incorporate by reference the information appearing under the caption “Security Ownership of Certain Beneficial Owners and Management” in the ProxyStatement. The information under Part II, Item 5. “Market for the Company’s Common Stock, Related Stockholder Matters and Issuer Purchases of EquitySecurities - Equity Compensation Plan Information” of this report is also incorporated herein by reference.ITEM 13.Certain Relationships and Related Transactions, and Director Independence.We incorporate by reference the information appearing under the captions “Certain Relationships and Related Party Transactions” and “Corporate Governance -Director Independence” in the Proxy Statement.ITEM 14.Principal Accountant Fees and Services.We incorporate by reference the information appearing under the caption “Proposal 4 - Ratification of Appointment of Independent Registered Public AccountingFirm” in the Proxy Statement.115PART IVITEM 15.Exhibits, Financial Statement Schedules.(a) 1.Financial statements of the Company (including related notes to consolidated financial statements) filed as part of this report are listed below (seeItem 8):Report of Independent Registered Public Accounting Firm.Consolidated Balance Sheets as of December 31, 2016 and 2015 .Consolidated Statements of Operations and Comprehensive Income/(Loss) for the Years Ended December 31, 2016 , 2015 , and 2014 .Consolidated Statements of Stockholders’ Equity/(Deficit) for the Years Ended December 31, 2016 , 2015 , and 2014 .Consolidated Statements of Cash Flows for the Years Ended December 31, 2016 , 2015 , and 2014 .2.Financial statement schedules of the Company as follows:Schedule I—Condensed Financial Information of Registrant Parent Company Only as of December 31, 2016 and 2015 and for the Years EndedDecember 31, 2016 , 2015 , and 2014 .We have omitted schedules other than the ones listed above because they are not required or are not applicable, or the required information is shownin the financial statements or notes to the financial statements.3.Exhibits Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 2.1 Transaction Agreement, dated March 1, 2014, by andamong the Caesars Entertainment Corporation, CaesarsEntertainment Operating Company, Inc., Caesars LicenseCompany, LLC, Harrah’s New Orleans ManagementCompany, Corner Investment Company, LLC, 3535 LVCorp., Parball Corporation, JCC Holding Company II,LLC, Caesars Acquisition Company and Caesars GrowthPartners, LLC. — 8-K — 2.1 3/3/2014 2.2 First Amendment to the Transaction Agreement, datedMay 5, 2014, by and among Caesars EntertainmentCorporation, Caesars Entertainment Operating Company,Inc., Caesars License Company, LLC, Harrah’s NewOrleans Management Company, Corner InvestmentCompany, LLC, 3535 LV Corp., Parball Corporation,JCC Holding Company II, LLC, Caesars AcquisitionCompany, Caesars Growth Partners, LLC — 8-K — 2.1 5/6/2014 2.3 Omnibus License and Enterprise Services Agreement,dated as of May 20, 2014, by and among CaesarsEnterprise Services, LLC, Caesars EntertainmentOperating Company, Inc., Caesars Entertainment ResortProperties LLC and Caesars Growth Properties Holdings,LLC. — 8-K — 2.1 5/21/2014116 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 2.4 Agreement and Plan of Merger, dated as of December 21,2014, between Caesars Acquisition Company andCaesars Entertainment Corporation.* — 8-K — 2.1 12/22/2014 2.5 Amended and Restated Agreement and Plan of Merger,dated as of July 9, 2016, between Caesars AcquisitionCompany and Caesars Entertainment Corporation. — 8-K — 2.1 7/11/2016 3.1 Second Amended and Restated Certificate ofIncorporation of Caesars Entertainment Corporation,dated February 8, 2012. — 10-K 12/31/2011 3.7 3/15/2012 3.2 Amended Bylaws of Caesars Entertainment Corporation,as amended, dated February 8, 2012. — 10-K 12/31/2011 3.8 3/15/2012 4.1 Indenture, dated as of October 11, 2013, among theCERP Entities, the Subsidiary Guarantors and U.S. BankNational Association, as trustee, relating to the 8% First-Priority Senior Secured Notes due 2020. — 8-K — 4.1 10/15/2013 4.2 Second Supplemental Indenture, dated as of October 15,2014, among the CERP Entities and U.S. Bank NationalAssociation, as trustee, relating to the 8% First-PrioritySenior Secured Notes due 2020. — ***S-4 — 4.2 10/16/2014 4.3 Indenture, dated as of October 11, 2013, among theCERP Entities, the Subsidiary Guarantors and U.S. BankNational Association, as trustee, relating to the 11%Second-Priority Senior Secured Notes due 2021. — 8-K — 4.2 10/15/2013 4.4 Registration Rights Agreement, dated as of October 11,2013, by and among the CERP Entities, the SubsidiaryGuarantors and Citigroup Global Markets Inc., asrepresentative of the initial purchasers. — 8-K — 4.3 10/15/2013 4.5 Second Supplemental Indenture, dated as of October 15,2014, among the CERP Entities and U.S. Bank NationalAssociation, as trustee, relating to the 11% Second-Priority Senior Secured Notes due 2021. — ***S-4 — 4.4 10/16/2014 10.1 Amendment Agreement, dated as of July 25, 2014,among Caesars Entertainment Corporation, CaesarsEntertainment Operating Company, Inc., the Lendersparty thereto, Bank of America, N.A., as FormerAdministrative Agent, and Credit Suisse AG, CaymanIslands Branch, as New Administrative Agent. — 8-K — 10.1 7/28/2014 117 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.2 Reaffirmation Agreement, dated as of July 25, 2014,among Caesars Entertainment Corporation, CaesarsEntertainment Operating Company, Inc. each SubsidiaryLoan Party party thereto, the lenders party thereto andCredit Suisse AG, Cayman Islands Branch, asadministrative agent under the Third Amended andRestated Credit Agreement dated as of July 25, 2014,among Caesars Entertainment Corporation, CaesarsEntertainment Operating Company, Inc., the lenders partythereto from time to time and the other parties partythereto. — **10-Q 6/30/2014 10.41 8/14/2014 10.3 Amended and Restated Collateral Agreement dated andeffective as of January 28, 2008 (as amended and restatedon June 10, 2009), among Harrah’s Operating Company,Inc., each Subsidiary Party that is party thereto and Bankof America, N.A., as Collateral Agent. — 8-K — 10.3 6/15/2009 10.4 Other First Lien Secured Party Consent to the CollateralAgreement, dated as of October 5, 2012, by U.S. BankNational Association, as agent or trustee for persons whoshall become “Secured Parties” under the CollateralAgreement dated as of January 28, 2008, as amended andrestated as of June 10, 2009. — 8-K — 10.3 10/10/2012 10.5 Amended and Restated Guaranty and Pledge Agreementdated and effective as of January 28, 2008 (as amendedand restated on June 10, 2009), made by Harrah’sEntertainment, Inc. (as successor to Hamlet Merger Inc.)in favor of Bank of America, N.A., as AdministrativeAgent and Collateral Agent. — 8-K — 10.4 6/15/2009 10.6 Other First Lien Secured Party Consent to the Guarantyand Pledge Agreement, dated as of October 5, 2012, byU.S. Bank National Association, as agent or trustee forpersons who shall become “Secured Parties” under theGuaranty and Pledge Agreement dated as of January 28,2008, as amended and restated as of June 10, 2009. — 8-K — 10.4 10/10/2012 10.7 Other First Lien Secured Party Consent to the CollateralAgreement, dated as of February 20, 2013, by U.S. BankNational Association, as agent or trustee for persons whoshall become “Secured Parties” under the CollateralAgreement dated as of January 28, 2008, as amended andrestated as of June 10, 2009. — 8-K — 10.2 2/20/2013 118 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.8 Other First Lien Secured Party Consent to the CollateralAgreement, dated as of March 27, 2013, by U.S. BankNational Association, as agent or trustee for persons whoshall become “Secured Parties” under the CollateralAgreement dated as of January 28, 2008, as amended andrestated as of June 10, 2009. — 8-K — 10.4 3/28/2013 10.9 Other First Lien Secured Party Consent to the Guarantyand Pledge Agreement, dated as of February 20, 2013, byU.S. Bank National Association, as agent or trustee forpersons who shall become “Secured Parties” under theGuaranty and Pledge Agreement dated as of January 28,2008, as amended and restated as of June 10, 2009. — 8-K — 10.3 2/20/2013 10.10 Other First Lien Secured Party Consent to the Guarantyand Pledge Agreement, dated as of March 27, 2013, byU.S. Bank National Association, as agent or trustee forpersons who shall become “Secured Parties” under theGuaranty and Pledge Agreement dated as of January 28,2008, as amended and restated as of June 10, 2009. — 8-K — 10.5 3/28/2013 10.11 Guaranty and Pledge Agreement, dated as of July 25,2014, made by Caesars Entertainment Corporation infavor of Credit Suisse AG, Cayman Islands Branch, asadministrative agent and collateral agent — 8-K — 10.2 7/28/2014 10.12 Amendment to Guaranty and Pledge Agreement, dated asof August 21, 2015, among Caesars EntertainmentCorporation, Credit Suisse AG, Cayman Islands Branchand the Requisite Lenders party thereto. — 8-K — 10.2 8/24/2015 10.13 Intercreditor Agreement, dated as of January 28, 2008 byand among Bank of America, N.A. as administrativeagent and collateral agent under the Credit Agreement,Citibank, N.A. as administrative agent under the Bridge-Loan Agreement and U.S. Bank National Association asTrustee under the Indenture. — 10-K 12/31/2008 10.3 3/17/2009 10.14 Intercreditor Agreement, dated as of December 24, 2008among Bank of America, N.A. as Credit AgreementAgent, each Other First Priority Lien Obligations Agentfrom time to time, U.S. Bank National Association asTrustee and each collateral agent for any Future SecondLien Indebtedness from time to time. — 10-K 12/31/2008 10.4 3/17/2009 119 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.15 Joinder and Supplement to the Intercreditor Agreement,dated as of April 15, 2009 (to the Agreement datedDecember 24, 2008) by and among U.S. Bank NationalAssociation, as new trustee, U.S. Bank NationalAssociation, as Trustee under the IntercreditorAgreement, Bank of America, N.A., as Credit AgreementAgent under the Intercreditor Agreement, and any otherFirst Lien Agent and Second Priority Agent from time totime party to the Intercreditor Agreement. — 8-K — 10.1 4/20/2009 10.16 First Lien Intercreditor Agreement, dated as of June 10,2009 (to the Agreement dated December 24, 2008), byand among Bank of America, N.A., as collateral agent forthe First Lien Secured Parties and as AuthorizedRepresentative for the Credit Agreement Secured Parties,U.S. Bank National Association, as AuthorizedRepresentative for the Initial Other First Lien SecuredParties, and each additional Authorized Representativefrom time to time party to the First Lien IntercreditorAgreement. — 8-K/A — 10.1 6/11/2009 10.17 Joinder and Supplement to Intercreditor Agreement,dated June 10, 2009 (to the Agreement dated December24, 2008) by and among U.S. Bank National Association,as new trustee, U.S. Bank National Association, asTrustee under the Intercreditor Agreement, Bank ofAmerica, N.A., as Credit Agreement Agent under theIntercreditor Agreement, U.S. Bank National Associationas a Second Priority Agent under the IntercreditorAgreement and any other First Lien Agent and SecondPriority Agent from time to time party to the IntercreditorAgreement. (Exhibit A thereto incorporated by referenceto exhibit 10.4 to the Registrant's Annual Report on Form10-K filed March 17, 2009). — 8-K — 10.2 6/15/2009 10.18 Joinder and Supplement to the Intercreditor Agreement,dated as of September 11, 2009 by and among U.S. BankNational Association, as new trustee, U.S. Bank NationalAssociation, as Trustee under the IntercreditorAgreement, Bank of America, N.A., as Credit AgreementAgent under the Intercreditor Agreement, and any otherFirst Lien Agent and Second Priority Agent from time totime party to the Intercreditor Agreement related to the11.25% Senior Secured Notes due 2017. — 8-K — 10.1 9/17/2009 120 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.19 Joinder and Supplement to the Intercreditor Agreement,dated as of March 1, 2012, by and among U.S. BankNational Association, as new trustee, U.S. Bank NationalAssociation, as second priority agent, Bank of America,N.A., as credit agreement agent and U.S. Bank NationalAssociation, as other first priority lien obligations agent,relating to the 8.5% Senior Secured Notes due 2020. — 8-K — 10.3 3/2/2012 10.20 Joinder and Supplement to the Intercreditor Agreement,dated as of October 5, 2012, by and among U.S. BankNational Association, as new trustee, U.S. Bank NationalAssociation, as second priority agent, Bank of America,N.A., as credit agreement agent and U.S. Bank NationalAssociation, as other first priority lien obligations agent. — 8-K — 10.2 10/10/2012 10.21 Joinder and Supplement to the Intercreditor Agreement,dated as of February 20, 2013 (the IntercreditorAgreement dated December 24, 2008) , by and amongU.S. Bank National Association, as new trustee, U.S.Bank National Association, as second priority agent,Bank of America, N.A., as credit agreement agent andU.S. Bank National Association, as other first priority.lien obligations agent. — 8-K — 10.1 2/20/2013 10.22 Other First Lien Secured Party Consent to the CollateralAgreement, dated as of March 1, 2012, by U.S. BankNational Association, as agent or trustee for persons whoshall become “Secured Parties” under the CollateralAgreement dated as of January 28, 2008, as amended andrestated as of June 10, 2009. — 8-K — 10.4 3/2/2012 10.23 Other First Lien Secured Party Consent to the Guarantyand Pledge Agreement, dated as of March 1, 2012, byU.S. Bank National Association, as agent or trustee forpersons who shall become “Secured Parties” under theGuaranty and Pledge Agreement dated as of January 28,2008, as amended and restated as of June 10, 2009. — 8-K — 10.5 3/2/2012 10.24 Other First Lien Secured Party Consent, dated as ofSeptember 11, 2009, by U.S. Bank National Association,as agent or trustee for persons who shall become“Secured Parties” under the Amended and RestatedCollateral Agreement dated and effective as of January28, 2008 (as amended and restated on June 10, 2009). — 8-K — 10.2 9/17/2009 121 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.25 Other First Lien Secured Party Consent, dated as ofSeptember 11, 2009, by U.S. Bank National Association,as agent or trustee for persons who shall become“Secured Parties” under the Amended and RestatedGuaranty and Pledge Agreement dated and effective as ofJanuary 28, 2008 (as amended and restated on June 10,2009). — 8-K — 10.3 9/17/2009 10.26† Trust Agreement dated June 20, 2001 by and betweenHarrah’s Entertainment, Inc. and Wells Fargo BankMinnesota, N.A. — 10-Q 9/30/2001 10.4 11/9/2001 10.27† Escrow Agreement, dated February 6, 1990, by andbetween The Promus Companies Incorporated, certainsubsidiaries thereof, and Sovran Bank, as escrow agent. — 10-K 12/29/1989 Unknown 3/28/1990 10.28† Amendment to Escrow Agreement dated as of October29, 1993 (to the Agreement dated February 6, 1990)among The Promus Companies Incorporated, certainsubsidiaries thereof, and NationsBank, formerly SovranBank. — 10-K 12/31/1993 10.66 3/28/1994 10.29† Amendment, dated as of June 7, 1995 (the Agreementdated February 6, 1990 and amended on October 29,1993), to Escrow Agreement among The PromusCompanies Incorporated, certain subsidiaries thereof andNationsBank. — 8-K — 10.12 6/15/1995 10.30† Amendment, dated as of July 18, 1996, to EscrowAgreement between Harrah’s Entertainment, Inc. andNationsBank. — 10-Q 9/30/1996 10.1 11/12/1996 10.31† Amendment, dated as of October 30, 1997, to EscrowAgreement between Harrah’s Entertainment, Inc.,Harrah’s Operating Company, Inc. and NationsBank. — 10-K 12/31/1997 10.82 3/10/1998 10.32† Amendment to Escrow Agreement, dated April 26, 2000,between Harrah’s Entertainment, Inc. and Wells FargoBank Minnesota, N.A., Successor to Bank of America,N.A. — 10-Q 9/30/2000 10.8 11/13/2000 10.33† Letter Agreement with Wells Fargo Bank Minnesota,N.A., dated August 31, 2000, concerning appointment asEscrow Agent under Escrow Agreement for deferredcompensation plans. — 10-Q 9/30/2000 10.7 11/13/2000 10.34† Amendment and Restatement of Harrah’s Entertainment,Inc. Executive Deferred Compensation Plan, effectiveAugust 3, 2007. — 10-Q 6/30/2007 10.69 8/9/2007 122 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.35† Amendment and Restatement of Harrah’s Entertainment,Inc. Deferred Compensation Plan, effective as of August3, 2007. — 10-Q 6/30/2007 10.70 8/9/2007 10.36† Amendment and Restatement of Park PlaceEntertainment Corporation Executive DeferredCompensation Plan, effective as of August 3, 2007. — 10-Q 6/30/2007 10.71 8/9/2007 10.37† Amendment and Restatement of Harrah’s Entertainment,Inc. Executive Supplemental Savings Plan, effective as ofAugust 3, 2007. — 10-Q 6/30/2007 10.72 8/9/2007 10.38† Amendment and Restatement of Harrah’s Entertainment,Inc. Executive Supplemental Savings Plan II, effective asof August 3, 2007. — 10-Q 6/30/2007 10.73 8/9/2007 10.39† First Amendment to the Amendment and Restatement ofHarrah’s Entertainment, Inc. Executive SupplementalSavings Plan II, effective as of February 9, 2009. — 8-K — 10.2 2/13/2009 10.40† Second Amendment to the Amendment and Restatementof the Caesars Entertainment Corporation ExecutiveSupplemental Savings Plan II (fka Harrah’sEntertainment, Inc. Executive Supplemental Savings PlanII), effective as of November 5, 2014. — 10-K 12/31/2014 10.48 3/16/2015 10.41† Harrah’s Entertainment, Inc. Amended and RestatedExecutive Deferred Compensation Trust Agreementdated January 11, 2006 by and between Harrah’sEntertainment, Inc. and Wells Fargo Bank, N.A. — 10-K 12/31/2007 10.41 2/29/2008 10.42† Amendment to the Harrah’s Entertainment, Inc. Amendedand Restated Executive Deferred Compensation TrustAgreement effective January 28, 2008 by and betweenHarrah’s Entertainment, Inc. and Wells Fargo Bank, N.A. — 10-K 12/31/2007 10.42 2/29/2008 10.43 Equity Interest Purchase Agreement with Exhibits A-Fwith Penn National Gaming, Inc., Caesars EntertainmentOperating Company, Inc., Harrah’s Maryland HeightsOperating Company, Players Maryland Heights Nevada,LLC and Harrah’s Maryland Heights, LLC, dated May 7,2012. — 10-Q 6/30/2012 10.102 8/8/2012 10.44 Share Purchase Agreement between CaesarsEntertainment Operating Company, Inc., and PearlDynasty Investments Limited dated August 6, 2013. — 10-Q 6/30/2013 10.73 8/9/2013 123 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.45 Services Agreement, dated as of January 28, 2008, by andamong Harrah’s Entertainment, Inc., Apollo ManagementVI, L.P., Apollo Alternative Assets, L.P. and TPGCapital, L.P. — 8-K/A — 10.15 2/7/2008 10.46 Stockholders’ Agreement, dated as of January 28, 2008,by and among Apollo Hamlet Holdings, LLC, ApolloHamlet Holdings B, LLC, TPG Hamlet Holdings, LLC,TPG Hamlet Holdings B, LLC, Co-Invest HamletHoldings, Series LLC, Co-Invest Hamlet Holdings B,LLC, Hamlet Holdings LLC and Harrah’s Entertainment,Inc., and, solely with respect to Sections 3.01 and 6.07,Apollo Investment Fund VI, L.P. and TPG V HamletAIV, L.P. — 8-K/A — 10.14 2/7/2008 10.47 Form of First Amendment to the Stockholders’Agreement by and among Apollo Hamlet Holdings, LLC,Apollo Hamlet Holdings B, LLC, TPG Hamlet Holdings,LLC, TPG Hamlet Holdings B, LLC, Co-Invest HamletHoldings, Series LLC, Co-Invest Hamlet Holdings B,LLC, Hamlet Holdings LLC and Caesars EntertainmentCorporation. — S-1/A — 10.91 2/2/2012 10.48 Form of Release and Contribution Agreement, dated as ofJanuary 25, 2012, by and among Caesars EntertainmentCorporation, Co-Invest Hamlet Holdings, Series LLC,Co-Invest Hamlet Holdings B, LLC and the ParticipatingCo-Investors listed on Schedule I. — S-1/A — 10.90 2/2/2012 10.49 Form of Acknowledgment to the Services Agreementamong Caesars Entertainment Corporation, ApolloManagement VI, L.P., Apollo Alternative Assets, L.P.and TPG Capital, L.P. — S-1/A — 10.92 2/2/2012 10.50 Irrevocable Proxy of Hamlet Holdings LLC, datedNovember 22, 2010. — 8-K — 10.1 11/24/2010 10.51† Amended and Restated Management Investors RightsAgreement, dated November 22, 2010. — 8-K — 10.2 11/24/2010 10.52† Consent and Acknowledgment, dated May 6, 2013, to theAmended and Restated Management Investors RightsAgreement. — 10-Q 3/31/2013 10.74 5/9/2013 10.53 Amended and Restated Credit Agreement, Dated as ofNovember 14, 2012, among Caesars EntertainmentOperating Company, Inc., as Borrower, and CaesarsEntertainment Corporation, as Lender. — 10-K/A 12/31/2012 10.72 3/15/2013 124 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.54 First Lien Credit Agreement, dated as of October 11,2013, by and among the CERP Entities, Citicorp NorthAmerica Inc., as administrative agent and the lendersparty thereto. — 8-K — 10.1 10/15/2013 10.55 First Lien Intercreditor Agreement, dated as of October11, 2013, by and among the First Lien Collateral Agent,Citicorp North America, Inc., as authorized representativeunder the credit agreement and U.S. Bank NationalAssociation, as the initial other authorized representative. — 8-K — 10.2 10/15/2013 10.56 Second Lien Intercreditor Agreement, dated as of October11, 2013, by and among Citicorp North America, Inc., ascredit agreement agent, U.S. Bank National Association,as other first priority lien obligations agent and U.S. BankNational Association, as second priority agent. — 8-K — 10.3 10/15/2013 10.57 Collateral Agreement (First Lien), dated as of October 11,2013, by and among the CERP Entities, the SubsidiaryGuarantors, and Citicorp North America, Inc., ascollateral agent. — 8-K — 10.4 10/15/2013 10.58 Collateral Agreement (Second Lien), dated as of October11, 2013, by and among the CERP Entities, theSubsidiary Guarantors, and U.S. Bank NationalAssociation, as collateral agent. — 8-K — 10.5 10/15/2013 10.59 Transaction Agreement, dated as of October 21, 2013,among Caesars Acquisition Company, Caesars GrowthPartners, LLC, Caesars Entertainment Corporation, HIEHoldings, Inc., Harrah’s BC, Inc., PHW Las Vegas, LLC,PHW Manager, LLC, Caesars Baltimore AcquisitionCompany, LLC and Caesars Baltimore ManagementCompany, LLC. — 8-K — 10.1 10/22/2013 10.60 Amended and Restated Limited Liability CompanyAgreement of Caesars Growth Partners, LLC, dated as ofOctober 21, 2013. — 8-K — 10.2 10/22/2013 10.61 Management Services Agreement, dated as of October21, 2013, among Caesars Acquisition Company, CaesarsGrowth Partners, LLC and Caesars EntertainmentOperating Company, Inc. — 8-K — 10.3 10/22/2013 10.62 Registration Rights Agreement, dated as of October 21,2013, among Caesars Acquisition Company, CaesarsGrowth Partners, LLC and certain subsidiaries of CaesarsEntertainment Corporation. — 8-K — 10.4 10/22/2013 125 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.63 Registration Rights Agreement, dated as of October 21,2013, between Caesars Entertainment Corporation andCaesars Acquisition Company. — 8-K — 10.5 10/22/2013 10.64 Omnibus Voting Agreement, dated as of October 21,2013, among Apollo Hamlet Holdings, LLC, ApolloHamlet Holdings B, LLC, TPG Hamlet Holdings, LLC,TPG Hamlet Holdings B, LLC, Co-Invest HamletHoldings, Series LLC, Co-Invest Hamlet Holdings B,LLC, Hamlet Holdings LLC, Caesars EntertainmentCorporation and Caesars Acquisition Company. — 8-K — 10.6 10/22/2013 10.65 Voting Agreement, dated as of July 9, 2016, amongCaesars Entertainment Corporation, Hamlet HoldingsLLC and the Holders party thereto. — 8-K — 10.1 7/11/2016 10.66 Amendment Agreement, dated as of July 25, 2014,among Caesars Entertainment Corporation, CaesarsEntertainment Operating Company, Inc., the Lendersparty thereto, Bank of America, N.A., as FormerAdministrative Agent, and Credit Suisse AG, CaymanIslands Branch, as New Administrative Agent. — 8-K — 10.1 7/28/2014 10.67 Guaranty and Pledge Agreement, dated as of July 25,2014, made by Caesars Entertainment Corporation infavor of Credit Suisse AG, Cayman Islands Branch, asadministrative agent and collateral agent. — 8-K — 10.2 7/28/2014 10.68 Note Purchase and Support Agreement, dated as ofAugust 12, 2014, among Caesars EntertainmentOperating Company, Inc., Caesars EntertainmentCorporation, and certain holders of CEOC’s 6.50%Senior Notes due 2016 and/or 5.75% Senior Notes due2017. — 10-Q** 6/30/2014 10.42 8/14/2014 10.69 Waiver Agreement dated as of August 12, 2014 byCaesars Entertainment Operating Company, Inc. andCaesars Entertainment Corporation for the exclusivebenefit of UMB Bank, National Association, as successortrustee and any successor trustee under each of theIndentures referenced therein, and the registered andbeneficial holders from time to time of the senior securednotes referenced therein. — 8-K** — 10.1 8/14/2014 10.70 Amended and Restated Limited Liability CompanyAgreement of Caesars Enterprise Services, LLC, datedMay 20, 2014. — 8-K — 99.1 5/21/2014 126 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.71 Amended and Restated Waiver Agreement dated as ofAugust 12, 2014 by Caesars Entertainment OperatingCompany, Inc. and Caesars Entertainment Corporationfor the exclusive benefit of UMB Bank, NationalAssociation, as successor trustee and any successortrustee under each of the Indentures referenced therein,and the registered and beneficial holders from time totime of the senior secured notes referenced therein. — 8-K** — 10.1 9/19/2014 10.72 Summary Term Sheet for Proposed Restructuring, datedJanuary 6, 2015, to Amended and Restated RestructuringSupport and Forbearance Agreement, dated as ofDecember 31, 2014, among Caesars EntertainmentOperating Company, Inc., on behalf of itself and thesubsidiary loan parties party thereto, CaesarsEntertainment Corporation, LeverageSource III (HHoldings), L.P., LeverageSource V, L.P. and each of theholders of First Lien Bond Claims party thereto. — 8-K — 10.1 1/6/2015 10.73 Amendment, dated as of June 3, 2014, to the Amendedand Restated Credit Agreement, dated as of November14, 2012, among Caesars Entertainment OperatingCompany, Inc., as Borrower, and Caesars EntertainmentCorporation, as Lender. — 10-Q 9/30/2014 — 11/14/2014 10.74 Fifth Amended and Restated Restructuring Support andForbearance Agreement, dated as of October 7, 2015,among Caesars Entertainment Operating Company, Inc.,on behalf of itself and the subsidiary loan parties partythereto, Caesars Entertainment Corporation,LeverageSource III (H Holdings), L.P., LeverageSourceV, L.P. and each of the holders of First Lien Bond Claimsparty thereto. — 8-K — 10.1 10/8/2015 10.75 Sixth Amended and Restated Restructuring Support andForbearance Agreement, dated as of October 4, 2016,among Caesars Entertainment Operating Company, Inc.,on behalf of itself and the subsidiary loan parties partythereto, Caesars Entertainment Corporation and each ofthe holders of First Lien Bond Claims party thereto. — 8-K/A — 10.2 10/6/2016 127 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.76 Sixth Amended and Restated Restructuring Support andForbearance Agreement, dated as of October 4, 2016,among Caesars Entertainment Operating Company, Inc.,on behalf of itself and the subsidiary loan parties partythereto, Caesars Entertainment Corporation and each ofthe holders of First Lien Bond Claims party thereto(conformed to reflect additional agreements among theparties as of November 14, 2016). — 8-K — 10.1 11/15/2016 10.77 Restructuring Support and Forbearance Agreement, datedas of August 21, 2015, among Caesars EntertainmentOperating Company, Inc., on behalf of itself and thesubsidiary loan parties party thereto, CaesarsEntertainment Corporation and each of the holders ofFirst Lien Bank Claims party thereto. — 8-K — 10.1 8/24/2015 10.78 Second Amended Restructuring Support and ForbearanceAgreement, dated as of October 4, 2016, among CaesarsEntertainment Operating Company, Inc., on behalf ofitself and the subsidiary loan parties party thereto,Caesars Entertainment Corporation and each of theholders of First Lien Bank Claims party thereto. — 8-K — 10.3 10/6/2016 10.79 Restructuring Support and Forbearance Agreement, datedas of July 20, 2015, among Caesars EntertainmentOperating Company, Inc., on behalf of itself and each ofthe debtors in the Chapter 11 Cases, CaesarsEntertainment Corporation, and each of the holders ofSecond Lien Bond Claims party thereto. — 8-K — 10.1 7/21/2015 10.80 Restructuring Support and Forbearance Agreement, datedas of June 6, 2016, among Caesars EntertainmentOperating Company, Inc., on behalf of itself and each ofthe debtors in the Chapter 11 Cases, CaesarsEntertainment Corporation and each of the holders ofSGN Claims party thereto. — 8-K — 10.1 6/8/2016 10.81 Restructuring Support, Settlement and ContributionAgreement, dated as of June 7, 2016, among CaesarsEntertainment Operating Company, Inc., on behalf ofitself, each of the debtors in the Chapter 11 Cases and itsother direct and indirect subsidiaries and CaesarsEntertainment Corporation. — 8-K — 10.2 6/8/2016 128 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.82 First Amended Restructuring Support and ForbearanceAgreement, dated as of June 20, 2016, among CaesarsEntertainment Operating Company, Inc., on behalf ofitself and the subsidiary loan parties party thereto,Caesars Entertainment Corporation and each of theholders of First Lien Bank Claims party thereto. — 8-K — 10.1 6/21/2016 10.83 Restructuring Support and Settlement Agreement, datedas of June 22, 2016, among Caesars EntertainmentOperating Company, Inc., on behalf of itself and each ofthe debtors in the Chapter 11 Cases, CaesarsEntertainment Corporation and the statutory unsecuredclaimholders’ committee in the Chapter 11 Cases. — 8-K — 10.1 6/22/2016 10.84 First Amended and Restated Restructuring Support,Settlement and Contribution Agreement, dated as of July9, 2016, between Caesars Entertainment Corporation andCaesars Entertainment Operating Company, Inc. — 8-K — 10.2 7/11/2016 10.85 Restructuring Support and Forbearance Agreement, datedas of July 31, 2016, among Caesars EntertainmentOperating Company, Inc., on behalf of itself and each ofthe debtors in the Chapter 11 Cases, CaesarsEntertainment Corporation, and each of the holders ofSecond Lien Bond Claims party thereto. — 8-K — 10.1 8/1/2016 10.86 Amendment No. 1 to First Amended and RestatedRestructuring Support and Forbearance Agreement, datedas of October 4, 2016, among Caesars EntertainmentOperating Company, Inc., on behalf of itself and each ofthe debtors in the Chapter 11 Cases, CaesarsEntertainment Corporation and each of the holders ofSGN Claims party thereto. — 8-K — 10.4 10/6/2016 10.87 Restructuring Support, Forbearance and SettlementAgreement, dated as of October 4, 2016, among CaesarsEntertainment Operating Company, Inc., on behalf ofitself and each of the debtors in the Chapter 11 Cases,Caesars Entertainment Corporation, Caesars AcquisitionCompany (solely for Sections 2(b)(vii), 5(g) and 30),each of the holders of Second Lien Bond Claims partythereto and the Second Lien Committee. — 8-K — 10.1 10/6/2016 10.88 Consent to CIE Sale Transaction, dated as of July 30,2016, by and between Caesars Acquisition Company andCaesars Entertainment Corporation. — 8-K — 10.1 8/1/2016 129 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.89 CIE Proceeds and Reservation of Rights Agreement,dated as of September 9, 2016 entered into by and amongCaesars Interactive Entertainment, Inc., CaesarsAcquisition Company, on behalf of itself and each of itsdirect and indirect subsidiaries, Caesars EntertainmentCorporation, on behalf of itself and each of its direct andindirect subsidiaries, other than Caesars EntertainmentOperating Company, Inc., and Caesars EntertainmentOperating Company, Inc. on behalf of itself and each ofthe debtors in the Chapter 11 Cases. — 8-K — 10.1 9/12/2016 10.90 Amendment No. 1 to CIE Proceeds and Reservation ofRights Agreement, dated as of October 7, 2016, by andamong Caesars Interactive Entertainment, LLC (formerlyknown as Caesars Interactive Entertainment, Inc.),Caesars Acquisition Company, on behalf of itself andeach of its direct and indirect subsidiaries, CaesarsEntertainment Corporation, on behalf of itself and each ofits direct and indirect subsidiaries, other than CaesarsEntertainment Operating Company, Inc., and CaesarsEntertainment Operating Company, Inc. on behalf ofitself and each of the debtors in the Chapter 11 Cases. — 8-K — 10.1 10/7/2016 10.91 First Amendment to the Amended and Restated LimitedLiability Company Agreement of Caesars GrowthPartners, LLC, dated as of October 21, 2013, dated as ofSeptember 23, 2016, entered into by and among CaesarsAcquisition Company, in its capacity as Caesars GrowthPartners, LLC’s managing member and as a member ofCaesars Growth Partners, LLC, HIE Holdings, Inc.,Harrah’s BC, Inc. and Caesars EntertainmentCorporation. — 8-K — 10.1 9/26/2016 10.92 Second Amendment to the Amended and RestatedLimited Liability Company Agreement of CaesarsGrowth Partners, LLC, dated as of October 21, 2013,dated as of October 7, 2016, entered into by and amongCaesars Acquisition Company, in its capacity as CaesarsGrowth Partners, LLC’s managing member and as amember of Caesars Growth Partners, LLC, HIE Holdings,Inc., Harrah’s BC, Inc. and Caesars EntertainmentCorporation. — 8-K — 10.2 10/7/2016 130 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.93 Third Amendment to the Amended and Restated LimitedLiability Company Agreement of Caesars GrowthPartners, LLC, dated as of February 13, 2017, enteredinto by and among Caesars Acquisition Company, in itscapacity as Caesars Growth Partners, LLC’s managingmember and as a member of Caesars Growth Partners,LLC, HIE Holdings, Inc., Harrah’s BC, Inc. and CaesarsEntertainment Corporation. X 10.94 Settlement and Forbearance Agreement, dated as ofAugust 15, 2016, among Caesars EntertainmentOperating Company, Inc., on behalf of itself and each ofthe debtors in the Chapter 11 Cases, CaesarsEntertainment Corporation and Frederick Barton Danner. — 8-K — 99.1 8/17/2016 10.95† Caesars Entertainment Corporation Management EquityIncentive Plan, as amended and restated on November 29,2011. — S-1/A — 10.78 12/28/2011 10.96† Caesars Entertainment Corporation 2012 PerformanceIncentive Plan. — S-1/A — 10.89 2/2/2012 10.97† Amendment No.1 to the Caesars EntertainmentCorporation 2012 Performance Incentive Plan. — 8-K — 10.1 7/25/2012 10.98† Amendment No. 2 to the Caesars EntertainmentCorporation 2012 Performance Incentive Plan. — 8-K — 10.1 5/20/2015 10.99† Amendment No. 3 to the Caesars EntertainmentCorporation 2012 Performance Incentive Plan. — 8-K — 10.1 5/20/2016 10.100† Amendment No. 4 to the Caesars EntertainmentCorporation 2012 Performance Incentive Plan. — 10-Q 6/30/2016 10.3 8/2/2016 10.101† Form of Caesars Entertainment Corporation 2012Performance Incentive Plan Nonqualified Option AwardAgreement. — SC-TO-I — (d)(3) 7/25/2012 10.102† Form of Caesars Entertainment Corporation 2012Performance Incentive Plan Nonqualified Option AwardAgreement (Replacement Options). — SC-TO-I — (d)(4) 7/25/2012 10.103† Form of Caesars Entertainment Corporation 2012Performance Incentive Plan Nonqualified Option AwardAgreement (Replacement Options Granted to Gary W.Loveman). — SC-TO-I — (d)(5) 7/25/2012 131 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.104† Form of Caesars Entertainment Corporation 2012Performance Incentive Plan Nonqualified Option AwardAgreement. — SC-TO-I — (d)(3) 7/25/2012 10.105† Form of Caesars Entertainment 2012 PerformanceIncentive Plan Restricted Share Award Agreement. — 10-K/A 12/31/2012 10.84 3/15/2013 10.106† Form of Caesars Entertainment Corporation 2012Performance Incentive Plan Restricted Stock Unit AwardAgreement. — 8-K — 10.1 7/2/2013 10.107† Form of Restricted Stock Unit Award Agreement(January 2015 Retention Grants). — 8-K — 10.1 1/9/2015 10.108† Form of Indemnification Agreement entered into byCaesars Entertainment Corporation and each of itsdirectors and executive officers. — S-1 — 10.75 11/16/2010 10.109† Form of Stock Option Grant Agreement dated April 16,2012 between Caesars Entertainment Corporation andGary W. Loveman. — 10-Q 3/31/2012 10.96 5/9/2012 10.110† Form of Caesars Entertainment Corporation ManagementEquity Incentive Plan Stock Option Grant Agreement. — SC-TO-I — (d)(7) 7/25/2012 10.111† Form of Amendment to Caesars EntertainmentCorporation Management Equity Incentive Plan StockOption Grant Agreement. — SC-TO-I — (d)(8) 7/25/2012 10.112† Financial Counseling Plan of Harrah'sEntertainment, Inc., as amended January 1996. — 10-K 12/31/1995 10.22 3/6/1996 10.113† Waiver of Financial Counseling Plan, effective as ofApril 29, 2013, by and between Gary W. Loveman andCaesars Entertainment Corporation. — 10-Q 3/31/2013 10.31 5/9/2013 10.114† 2009 Senior Executive Incentive Plan, amended andrestated December 7, 2012. — 10-K/A 12/31/2012 10.90 3/15/2013 10.115† Caesars Entertainment Corporation Omnibus IncentivePlan, dated November 14, 2012. — 10-K/A 12/31/2012 10.91 3/15/2013 10.116† Form of Cash Award Agreement under 2012Performance Incentive Plan. — 8-K — 10.1 5/27/2016 10.117† Form of Restricted Stock Unit Award Agreement (July2016 Retention Awards). — 8-K — 10.4 7/6/2016 10.118† Form of Cash Award Agreement (July 2016 RetentionAwards). — 8-K — 10.5 7/6/2016 132 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.119† Employment Agreement made as of December 21, 2014,between Caesars Entertainment Corporation, a Delawarecorporation, Caesars Enterprise Services, LLC, and, forcertain purposes specified herein, only, CaesarsAcquisition Company, and Gary W. Loveman. — 10-K 12/31/2014 10.99 3/16/2015 10.120† Amendment and Restatement, dated December 29, 2014,of that certain award agreement made by and betweenCaesars Entertainment Corporation, and Gary Loveman,dated September 20, 2012, relating to an award ofOptions under the Caesars Entertainment Corporation2012 Performance Incentive Plan. — 10-K 12/31/2014 10.100 3/16/2015 10.121† Amendment and Restatement, dated as of December 29,2014, of that certain award agreement made by andbetween Caesars Entertainment Corporation, and GaryLoveman, dated April 16, 2012, relating to an award ofOptions under the Caesars Entertainment Corporation2012 Performance Incentive Plan. — 10-K 12/31/2014 10.101 3/16/2015 10.122† Amendment and Restatement, dated as of December 29,2014, of that certain award agreement, made by andbetween Caesars Entertainment Corporation, and GaryLoveman, dated June 28, 2013, relating to an award ofOptions under the Caesars Entertainment Corporation2012 Performance Incentive Plan. — 10-K 12/31/2014 10.102 3/16/2015 10.123† Amendment and Restatement, dated December 29, 2014,of that certain award agreement made by and betweenCaesars Entertainment Corporation and Gary Loveman,dated June 28, 2013, relating to an award of RestrictedStock Units under the Caesars Entertainment Corporation2012 Performance Incentive Plan. — 10-K 12/31/2014 10.103 3/16/2015 10.124† Amendment and Restatement, dated December 29, 2014,of that certain award agreement made by and betweenCaesars Entertainment Corporation and Gary Loveman,dated May 7, 2014, relating to an award of Options underthe Caesars Entertainment Corporation 2012 PerformanceIncentive Plan. — 10-K 12/31/2014 10.104 3/16/2015 10.125† Amendment and Restatement, dated December 29, 2014,of that certain award agreement made by and betweenCaesars Entertainment Corporation, and Gary Loveman,dated May 7, 2014, relating to an award of RestrictedStock Units under the Caesars Entertainment Corporation2012 Performance Incentive Plan. — 10-K 12/31/2014 10.105 3/16/2015 133 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.126† Letter Agreement, dated February 4, 2015, amongCaesars Entertainment Corporation, Caesars EnterpriseServices, LLC, Caesars Acquisition Company and GaryLoveman. — 10-Q 6/30/2015 10.4 8/6/2015 10.127† Employment Agreement dated February 5, 2015, betweenCaesars Entertainment Corporation, Caesars EnterpriseServices, LLC, and Mark Frissora. — 10-K 12/31/2014 10.106 3/16/2015 10.128† Amendment No. 1 to Employment Agreement, made asof August 4, 2015, between Caesars EntertainmentCorporation, Caesars Enterprise Services, LLC and MarkFrissora. — 10-Q 6/30/2015 10.5 8/6/2015 10.129† Amendment No. 2 to Employment Agreement, made asof February 5, 2015, by and among CaesarsEntertainment Corporation, Caesars Enterprise Services,LLC, Caesars Acquisition Company and Mark Frissora. — 8-K — 10.1 7/6/2016 10.130† Restricted Stock Unit Award Agreement by and betweenMark Frissora and Caesars Entertainment Corporation,dated March 23, 2016. — 8-K — 10.2 7/6/2016 10.131† Restricted Stock Unit Award Agreement by and betweenMark Frissora and Caesars Acquisition Company, datedJune 29, 2016. — 8-K — 10.3 7/6/2016 10.132† Form of Employment Agreement between CaesarsEntertainment Operating Company, Inc., and Thomas M.Jenkin (assigned by Caesars Entertainment OperatingCompany, Inc. to Caesars Enterprise Services, LLC onOctober 1, 2014). — 8-K — 10.1 1/9/2012 10.133† Employment Agreement made as of April 2, 2009 by andbetween Caesars Entertainment Operating Company, Inc.and Timothy R. Donovan (assigned by CaesarsEntertainment Operating Company, Inc. to CaesarsEnterprise Services, LLC on October 1, 2014). — 10-K/A 12/31/2012 10.87 3/15/2013 10.134† Letter Agreement dated August 19, 2015, by and betweenTimothy Donovan and Caesars Enterprise Services, LLC — 8-K — 10.1 8/19/2015 10.135† Consulting Agreement dated November 10, 2014between Donald Colvin and Caesars Enterprise Services,LLC. — 8-K — 10.1 11/12/2014 10.136† Employment Agreement, made as of November 10, 2014,by and between Caesars Enterprise Services, LLC andEric Hession. — 8-K — 10.2 11/12/2014 134 Incorporated by ReferenceExhibit Number Exhibit Description FiledHerewith Form Period Ending Exhibit Filing Date 10.137† Caesars Acquisition Company Equity-BasedCompensation Plan — 8-K — 10.1 4/16/2014 10.138† Form Equity Compensation Grant Agreement under theCaesars Acquisition Company Equity-BasedCompensation Plan. — 8-K — 10.2 4/16/2014 14 Amended and Restated Code of Business Conduct andEthics, amended February 21, 2013 — 10-K/A 12/31/2013 14 3/15/2013 18.1 Preferability letter regarding changes in accountingprinciples — 10-K/A 12/31/2013 18.1 3/15/2013 21 List of Subsidiaries X 23 Consent of Deloitte & Touche, LLP, independentregistered public accounting firm. X 31.1 Certification of Principal Executive Officer Pursuant toSection 302 of the Sarbanes-Oxley Act of 2002. X 31.2 Certification of Principal Financial Officer Pursuant toSection 302 of the Sarbanes-Oxley Act of 2002. X 32.1‡ Certification of Principal Executive Officer Pursuant toSection 906 of the Sarbanes-Oxley Act of 2002. — 32.2‡ Certification of Principal Financial Officer Pursuant toSection 906 of the Sarbanes-Oxley Act of 2002. — 99.1 Gaming and Regulatory Overview X 99.2 Term Sheet for Proposed Restructuring, dated September26, 2016. — 8-K — 99.1 9/27/2016 101.INS XBRL Instance Document X 101.SCH XBRL Taxonomy Extension Schema Document X 101.CAL XBRL Taxonomy Extension Calculation LinkbaseDocument X 101.DEF XBRL Taxonomy Extension Definition LinkbaseDocument X 101.LAB XBRL Taxonomy Extension Label Linkbase Document X 101.PRE XBRL Taxonomy Extension Presentation LinkbaseDocument X 135† Denotes a management contract or compensatory plan or arrangement.‡ Furnished herewith.* Schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Registrant agrees to furnish supplementally to theSEC a copy of any omitted schedule or exhibit upon request.** Filed by Caesars Entertainment Operating Company, Inc.*** Filed by Caesars Entertainment Resort Properties, LLC.136Schedule ICONDENSED FINANCIAL INFORMATION OF REGISTRANT PARENT COMPANY ONLYCAESARS ENTERTAINMENT CORPORATIONCONDENSED BALANCE SHEETS As of December 31,(In millions)2016 2015Assets Current assets Cash and cash equivalents$78 $48Restricted cash16 —Prepayments and other current assets3 7Intercompany receivables— 18Total current assets97 73Restricted cash— 100Deferred charges and other assets89 94Investment in subsidiary3,846 1,871Total assets$4,032 $2,138 Liabilities and Stockholders’ Equity/(Deficit) Current liabilities Accounts payable$33 $4Accrued expenses56 35Intercompany payables20 —Accrued restructuring and support expenses6,601 905Total current liabilities6,710 944Deferred credits and other liabilities50 53Deferred income taxes449 154Total liabilities7,209 1,151Total stockholders’ equity/(deficit)(3,177) 987Total liabilities and stockholders’ equity/(deficit)$4,032 $2,138See accompanying Notes to Condensed Financial Information. 137Schedule ICONDENSED FINANCIAL INFORMATION OF REGISTRANT PARENT COMPANY ONLYCAESARS ENTERTAINMENT CORPORATIONCONDENSED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME/(LOSS) Years Ended December 31,(In millions)2016 2015 2014Net revenues$2 $12 $—Operating expenses Income on interests in non-consolidated affiliates— — (1)(Gain)/loss on interests in subsidiaries(2,083) (144) 2,765Corporate expense96 95 14Other operating costs55 111 10Total operating expenses(1,932) 62 2,788Income/(loss) from operations1,934 (50) (2,788)Interest expense(5) (4) (3)Deconsolidation and restructuring of CEOC and other(5,758) 6,110 15Income/(loss) from operations before income taxes(3,829) 6,056 (2,776)Income tax benefit/(provision)260 (136) (7)Net income/(loss)(3,569) 5,920 (2,783)Other comprehensive income, net of income taxes— — —Comprehensive income/(loss)$(3,569) $5,920 $(2,783)See accompanying Notes to Condensed Financial Information.138Schedule ICONDENSED FINANCIAL INFORMATION OF REGISTRANT PARENT COMPANY ONLYCAESARS ENTERTAINMENT CORPORATIONCONDENSED STATEMENT OF CASH FLOWS Years Ended December 31,(In millions)2016 2015 2014Cash flows provided by/(used in) operating activities$(47) $(287) $152Cash flows from investing activities Proceeds from long term receivable— 40 —Cash flows provided by investing activities— 40 —Cash flows from financing activities Issuance of common stock, net of fees— — 136Proceeds from the issuance of long-term debt— — 13Repayments of long-term debt— (68) —Other financing(7) (2) —Cash flows provided by/(used in) financing activities(7) (70) 149Net increase/(decrease) in cash, cash equivalents, and restricted cash(54) (317) 301Cash, cash equivalents, and restricted cash, beginning of period148 465 164Cash, cash equivalents, and restricted cash, end of period$94 $148 $465See accompanying Notes to Condensed Financial Information.139Schedule ICONDENSED FINANCIAL INFORMATION OF REGISTRANT PARENT COMPANY ONLYCAESARS ENTERTAINMENT CORPORATIONNOTES TO CONDENSED FINANCIAL INFORMATION1.Background and basis of presentationThese condensed parent company financial statements have been prepared in accordance with Rule 12-04, Schedule 1 of Regulation S-X, as the restricted netassets of Caesars Entertainment Corporation and its subsidiaries exceed 25% of the consolidated net assets of Caesars Entertainment Corporation and itssubsidiaries (the “Company”). This information should be read in conjunction with the company’s consolidated financial statements included elsewhere in thisfiling.2.Restricted net assets of subsidiariesCertain of the Company’s subsidiaries have restrictions on their ability to pay dividends or make intercompany loans and advances pursuant to financingarrangements and regulatory restrictions. The amount of restricted net assets the Company’s consolidated subsidiaries held as of December 31, 2016 and 2015 wasapproximately $4.0 billion and $2.1 billion , respectively. Such restrictions are on net assets of Caesars Entertainment Corporation and its subsidiaries. The amountof restricted net assets in the Company’s unconsolidated subsidiaries was not material to the financial statements.3.Commitments, contingencies, and long-term obligationsFor a discussion of the Company’s commitments, contingencies, and long-term obligations under its senior secured credit facilities, see Note 11 of the Company’sconsolidated financial statements.4.Impact of deconsolidation of Caesars Entertainment Operating Company, Inc. (“CEOC”)The accompanying financial statements are based upon the Company's current conclusions regarding ownership of assets and obligation to pay liabilities. OnJanuary 15, 2015, CEOC (the Company's largest subsidiary) and certain of its U.S. subsidiaries voluntarily filed for reorganization under Chapter 11 of the UnitedStates Bankruptcy Code in the United States Bankruptcy Court for the Northern District of Illinois in Chicago (the “Bankruptcy Court”). Because CEOC is underthe control of the Bankruptcy Court, CEC deconsolidated this subsidiary effective January 15, 2015.5.Going concernAs described more fully in Note 1 of the Company’s consolidated financial statements, the Company made material commitments under CEOC’s plan ofreorganization (the “Restructuring”) and is a defendant in litigation, including the Noteholder Disputes, and other noteholder disputes relating to certain CEOCtransactions dating back to 2010. The circumstances described in Note 1 under “ Going Concern ” raise substantial doubt as to the Company’s ability to continue asa going concern without securing additional funding to meet its ongoing obligations and its commitments under the Restructuring. Additionally, in each of thelitigation matters disclosed in Note 1 under “ Litigation ,” claims have been made or could be made against the Company that, if resolved against it, raisesubstantial doubt about the Company’s ability to continue as a going concern. Under the terms of the Restructuring, all such litigation should be resolved.However, in the event of a material adverse ruling on one or all of the litigation matters disclosed in Note 1 , it is likely that a reorganization under Chapter 11 ofthe Bankruptcy Code would be necessary.140SIGNATURESPursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf bythe undersigned, thereunto duly authorized. CAESARS ENTERTAINMENT CORPORATION February 14, 2017By: / S / MARK P. FRISSORA Mark P. Frissora President and Chief Executive OfficerPursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of theregistrant in the capacities and on the dates indicated.Signature Title Date /s/ JEFFREY BENJAMIN Director February 14, 2017Jeffrey Benjamin /s/ DAVID BONDERMAN Director February 14, 2017David Bonderman /s/ KELVIN DAVIS Director February 14, 2017Kelvin Davis /s/ FRED J. KLEISNER Director February 14, 2017Fred J. Kleisner /s/ GARY W. LOVEMAN Director and Chairman of the Board February 14, 2017Gary W. Loveman /s/ ERIC PRESS Director February 14, 2017Eric Press /s/ MARC ROWAN Director February 14, 2017Marc Rowan /s/ DAVID SAMBUR Director February 14, 2017David Sambur /s/ CHRISTOPHER J. WILLIAMS Director February 14, 2017Christopher J. Williams /s/ BERNARD L. ZUROFF Director February 14, 2017Bernard L. Zuroff /s/ MARK P. FRISSORA Director, President, and February 14, 2017Mark P. Frissora Chief Executive Officer /s/ ERIC HESSION Executive Vice President and February 14, 2017Eric Hession Chief Financial Officer /s/ KEITH A. CAUSEY Senior Vice President and February 14, 2017Keith A. Causey Chief Accounting Officer 141Execution VersionExhibit 10.93THIRD AMENDMENT TO THE AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF CAESARS GROWTH PARTNERS, LLCThis Third Amendment (this “ Amendment ”) to the Amended and Restated Limited Liability Company Agreement ofCaesars Growth Partners, LLC, a Delaware limited liability company (the “ Company ”), dated as of October 21, 2013, as amendedby the First Amendment to the Amended and Restated Limited Liability Company Agreement of the Company, dated as ofSeptember 23, 2016, and the Second Amendment to the Amended and Restated Limited Liability Company Agreement of theCompany, dated as of October 7, 2016, in each case, entered into by and among the parties hereto (as amended, restated, amendedand restated, supplemented or otherwise modified from time to time, the “ CGP Operating Agreement ”), is dated and effective asof February 13, 2017, is being entered into by and among Caesars Acquisition Company, a Delaware corporation (“ CAC ”), in itscapacity as the Company’s managing member and as a Member (as defined below), HIE Holdings, Inc., a Delaware corporation andHarrah’s BC, Inc., a Delaware corporation (each, a “ CEC Member ”, and together, the “ CEC Members ”, and collectively withCAC, the “ Members ”), and Caesars Entertainment Corporation, a Delaware corporation (“ CEC ”). Capitalized terms used in thisAmendment but not otherwise defined herein shall have the meanings given to such terms in the CGP Operating Agreement.WHEREAS , in accordance with Section 15.5 of the CGP Operating Agreement, the Managing Member, CEC and theMembers wish to amend the CGP Operating Agreement to increase the distributions to the CEC Members and permit its use foradditional purposes as set forth herein.NOW , THEREFORE , in consideration of the promises and the mutual agreements herein contained and for other goodand valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legallybound, agree as follows:Article I. AMENDMENTSSection 1.1 Section 1.1 of the CGP Operating Agreement . The following definitions shall be added to Exhibit A-1 of theCGP Operating Agreement in alphabetical order:US-DOCS\75051579.4“ CIE Proceeds Agreement ” has the meaning set forth in Section 6.9(a) .Section 1.2 Section 6.9 of the CGP Operating Agreement . Section 6.9 of the CGP Operating Agreement is herebyamended to read in its entirety as follows (bold, underlined text indicates an addition):“6.9. Special Distributions . Following the consummation of the CIE Sale Transaction, notwithstanding anything tothe contrary in this Agreement (including, without limitation, Sections 6.2 , 6.3 , 6.4 , 6.5 and 12.2) , the Company shallmake special distributions to the Members from the proceeds of the CIE Sale Transaction, as follows:(a) from time to time, upon the reasonable request of CEC and to the extent (i) permitted by that certain CIEProceeds and Reservation of Rights Agreement, dated as of September 9, 2016, by and among CIE, CAC, CEC and CEOC,as amended by the Amendment No. 1 to the CIE Proceeds and Reservation of Rights Agreement, dated as of October 7,2016, entered into by the parties thereto (the “ CIE Proceeds Agreement ”), and (ii) that there is no action, suit or proceedingpreventing such distribution, to the CEC Members, an aggregate cash amount not to exceed the sum of: (x) $235 million forthe payment of professional fees and certain other payments as provided in the CIE Proceeds Agreement and that certainRestructuring Support, Forbearance, and Settlement Agreement, dated as of October 4, 2016, entered into by and amongCEOC, CEC, CAC and the other parties thereto, (y) $50 million to replenish a deposit previously made by CEC for thesupport or advancement of a proposed casino project in South Korea and (z) $35 million to be paid to CEOC insatisfaction of the Recoverable Amount (as defined in the CIE Proceeds Agreement) in accordance with and as setforth in the CIE Proceeds Agreement ( clauses (x), (y) and (z) collectively, the “ CEC Special Distributions ”); and(b) from time to time, when and as determined by the Managing Member, to CAC, an aggregate cash amount not toexceed the CAC Tax Liability Amount (the “ CAC Special Distributions ”).In addition, notwithstanding anything to the contrary in this Agreement, the parties hereto agree that (i) the SpecialDistributions shall not be taken into account for purposes of determining the amounts that any Member is entitled to receiveunder Sections 6.3 or 12.2 , except to the extent provided in Section 12.2(c) ; (ii) without limiting the Special Distributions,no other distribution that constitutes a Tax Distribution shall be made to any Member as a result of any income or gainsarising out of the CIE Sale Transaction; (iii) the proceeds of the CIE Sale Transaction used to pay the Special Distributionsshall not be deemed proceeds of a Liquidation Event or a Partial Liquidation for purposes of this Agreement and theremaining proceeds of the CIE Sale Transaction shall be distributed at such time as the Managing Member shall determine asa Partial Liquidation in accordance with this Agreement; and (iv)2US-DOCS\75051579.4for purposes of Section 6.2 ( Allocations ), Net Profits (and to the extent necessary, individual items of income or gain)attributable to the CIE Sale Transaction shall be allocated among the Members in a manner such that, after giving effect tothe special allocations set forth in Section 6.2(b), the Capital Account (or sub-accounts as applicable) of each Member,immediately after making such allocation, is, as nearly as possible, equal (proportionately) to (i) the distributions thatwould be made to such Members pursuant to Section 12.2 if the Company were dissolved, its affairs wound up and itsassets sold for cash equal to their Gross Asset Value, all Company liabilities were satisfied (limited with respect toeach nonrecourse liability to the Gross Asset Value of the assets securing such liability), and the net assets of theCompany were distributed in accordance with Section 12.2 (Amounts and Priority of Distributions) to the Membersimmediately after making such allocation, minus (ii) such Member’s share of Company Minimum Gain and MemberNonrecourse Debt Minimum Gain, computed immediately prior to the hypothetical sale of assets .”Section 1.3 Amendment to Section 12.2 of the CGP Operating Agreement . Section 12.2(d) of the CGP OperatingAgreement is hereby amended to read in its entirety as follows (bold, underlined text indicates an addition):“(d) Fourth , 100% to the holders of Class B Units (pro rata based on the relative amounts distributable to each suchholder pursuant to this Section 12.2 (d) ) until the aggregate amount distributed in respect of each Class B Unit pursuant tothis clause (d) and Section 6.3 hereof (and in the case of a Class B Unit that was converted from a Class A Unit, pursuant toclause (b) of this Section 12.2 in respect of such Unit) (inclusive of any amounts previously received in respect of each suchClass B Unit pursuant to this clause (d) ) equals (i) with respect to any Class B Units held by any Member other than CAC,the Class B Member Unit Amount in respect of each such Class B Unit as of the date of such distribution, and (ii) withrespect to any Class B Units held by CAC, the Class B CAC Unit Amount in respect of each such Class B Unit as of the dateof such distribution; and”Article II. MISCELLANEOUSSection 2.1 Effect on Agreement . Except as expressly amended by this Amendment, the CGP Operating Agreement shallremain in full force and effect in accordance with its terms. As amended hereby, the CGP Operating Agreement is hereby ratifiedand confirmed in all respects.Section 2.2 Binding Effect . This Amendment shall be binding upon and shall inure to the benefit of CAC, as theCompany’s managing member, CEC and each Member and their respective heirs, permitted successors, permitted assigns, permitteddistributees, and legal representatives; and by their signatures hereto, CAC, as the Company’s managing member, CEC and eachMember intends to and does hereby become bound. Nothing expressed or mentioned in this Amendment is3US-DOCS\75051579.4intended or shall be construed to give any Person other than the parties hereto and their respective permitted successors and assignsany legal or equitable right, remedy or claim under, in or in respect of this Amendment or any provision herein contained. Forpurposes of this Amendment, “ Person ” means any natural person, corporation, limited partnership, general partnership, limitedliability company, joint stock company, joint venture, association, company, estate, trust, bank trust company, land trust, businesstrust, or other organization, whether or not a legal entity, custodian, trustee-executor, administrator, nominee or entity in arepresentative capacity and any government or agency or political subdivision thereof.Section 2.3 Merger Agreement . Each of CAC and CEC acknowledge and agree that nothing in this Amendment shallamend, alter or modify in any respect the terms of, or constitute a consent, approval or waiver of rights under, that certain Amendedand Restated Agreement and Plan of Merger, dated as of July 9, 2016, between CAC and CEC (the “ Merger Agreement ”),including, without limitation, in respect of each party’s covenants and obligations under Section 5.2 of the Merger Agreement (assuch covenants and obligations relate to the proposed casino project in South Korea or otherwise).Section 2.4 Governing Law; Severability . This Amendment, and all rights and remedies in connection therewith, will begoverned by, and construed under, the applicable laws of the State of Delaware, without regard to otherwise governing principles ofconflicts of law (whether of the State of Delaware or otherwise) that would result in the application of the laws of any otherjurisdiction. If any provision of this Amendment is held to be illegal, invalid or unenforceable under present or future applicablelaws effective during the term of this Amendment, such provision shall be fully severable; this Amendment shall be construed andenforced as if such illegal, invalid or unenforceable provision had never comprised a part of this Amendment; and the remainingprovisions of this Amendment shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceableprovision or by its severance from this Amendment. Furthermore, in lieu of each such illegal, invalid or unenforceable provision,there shall be added automatically as a part of this Amendment a provision as similar in terms to such illegal, invalid orunenforceable provision as may be possible and be legal, valid, and enforceable.Section 2.5 Counterparts . This Amendment may be executed in any number of counterparts (including facsimilecounterparts), all of which together shall constitute a single instrument.[REMAINDER OF THE PAGE INTENTIONALLY LEFT BLANK]4US-DOCS\75051579.4IN WITNESS WHEREOF, the Company, the Managing Member and the other Members, and CEC have executed thisAmendment as of the date first set forth above.MANAGING MEMBER:CAESARS ACQUISITION COMPANYBy:/s/Craig AbrahamsName: Craig Abrahams Title: Chief Financial OfficerCEC:CAESARS ENTERTAINMENT CORPORATIONBy:/s/Eric HessionName: Eric HessionTitle: Executive Vice President and Chief Financial Officer [ Signature Page to Third Amendment to CGP Operating Agreement ]MEMBERS:CAESARS ACQUISITION COMPANYBy:/s/Craig AbrahamsName: Craig Abrahams Title: Chief Financial OfficerHIE HOLDINGS, INC.By:/s/ Eric HessionName: Eric Hession Title: TreasurerHARRAH’S BC, INC.By:/s/ Eric HessionName: Eric Hession Title: Treasurer[ Signature Page to Third Amendment to CGP Operating Agreement ]Exhibit 21CAESARS ENTERTAINMENT CORPORATIONLIST OF SUBSIDIARIESAs of February 14, 2017Name Jurisdiction ofIncorporation190 Flamingo, LLC Nevada3535 LV Corp. Nevada3535 LV Parent, LLC DelawareAC Conference Holdco., LLC DelawareAC Conference Newco., LLC DelawareAJP Holdings, LLC DelawareAJP Parent, LLC DelawareAster Insurance Ltd. BermudaB I Gaming Corporation NevadaBally's Las Vegas Manager, LLC DelawareBally's Midwest Casino, Inc. DelawareBally's Park Place, Inc. New JerseyBaluma Cambio, S.A. UruguayBaluma Holdings S.A. 2 BahamasBaluma Ltda. BrazilBaluma S.A. 3 UruguayBenco, Inc. NevadaBiloxi Hammond, LLC DelawareBiloxi Village Walk Development, LLC DelawareBL Development Corp. MinnesotaBoardwalk Regency Corporation New JerseyBPP Providence Acquisition Company, LLC DelawareBrussels Casino S.A. BelgiumBurlington Street Services Limited England/WalesCA Hospitality Holding Company, Ltd. British Virgin IslandsCaesars Air, LLC DelawareCaesars Asia Limited Hong KongCaesars Bahamas Investment Corporation BahamasCaesars Bahamas Management Corporation BahamasCaesars Baltimore Acquisition Company, LLC DelawareCaesars Baltimore Development Company, LLC DelawareCaesars Baltimore Management Company, LLC DelawareCaesars Canada Marketing Services Corporation CanadaCaesars Casino Castilla La Mancha S.A. 4 SpainCaesars Enterprise Services, LLC 5 DelawareCaesars Entertainment Canada Holding, Inc. NevadaCaesars Entertainment Finance Corp. NevadaCaesars Entertainment Golf, Inc. NevadaCaesars Entertainment Operating Company, Inc. 6 DelawareCaesars Entertainment Resort Properties Finance, Inc. DelawareCaesars Entertainment Resort Properties Holdco, LLC DelawareCaesars Entertainment Resort Properties, LLC DelawareCaesars Entertainment Retail, Inc. NevadaCaesars Entertainment Services (UK) Ltd. United KingdomCaesars Entertainment UK Ltd. United KingdomCaesars Entertainment Windsor Limited CanadaCaesars Escrow Corporation DelawareCaesars Europe Development, LLC DelawareCaesars Florida Acquisition Company, LLC DelawareCaesars Hotel Castilla La Mancha, S.L. SpainCaesars India Sponsor Company, LLC Nevada1Name Jurisdiction ofIncorporationCaesars Growth Partners, LLC 7 DelawareCaesars Korea Holding Company, LLC DelawareCaesars Korea Services, LLC DelawareCaesars License Company, LLC NevadaCaesars Linq, LLC DelawareCaesars Marketing Services Corporation NevadaCaesars Massachusetts Acquisition Company, LLC DelawareCaesars Massachusetts Development Company, LLC DelawareCaesars Massachusetts Investment Company, LLC DelawareCaesars Massachusetts Management Company, LLC DelawareCaesars New Jersey, Inc. New JerseyCaesars Octavius, LLC DelawareCaesars Ohio Acquisition, LLC DelawareCaesars Ohio Investment, LLC DelawareCaesars Ontario Holding, Inc. CanadaCaesars Operating Escrow LLC DelawareCaesars Palace Corporation DelawareCaesars Palace Realty Corporation NevadaCaesars Palace Sports Promotions, Inc. NevadaCaesars Riverboat Casino, LLC IndianaCaesars Spain Holdings Limited England/WalesCaesars Tournament, LLC DelawareCaesars Trex, Inc. DelawareCaesars United Kingdom, Inc. NevadaCaesars World International Corporation PTE, Ltd. SingaporeCaesars World International Far East Limited Hong KongCaesars World Marketing Corporation New JerseyCaesars World Merchandising, Inc. NevadaCaesars World, LLC FloridaCalifornia Clearing Corporation CaliforniaCasanova Club Limited England/WalesCasino Computer Programming, Inc. IndianaCG Services, LLC DelawareCH Management Company, Ltd. Hong KongChester Downs and Marina LLC 8 PennsylvaniaChester Downs Finance Corp. DelawareChester Facility Holding Company, LLC DelawareChristian County Land Acquisition Company, LLC DelawareCinderlane, Inc. NevadaConsolidated Supplies, Services and Systems NevadaCorby Leisure Retail Development Limited England/WalesCorner Investment Company Newco, LLC NevadaCreator Capital Limited 9 BermudaCromwell Manager, LLC DelawareCulembourg Metropole Casino (Pty) Limited South AfricaCZL Development Company, LLC DelawareCZL Investment Company, LLC DelawareCZL Management Company, LLC DelawareDagger Holdings Limited England/WalesDCH Exchange, LLC NevadaDCH Lender, LLC NevadaDes Plaines Development Limited Partnership 10 DelawareDesert Palace, Inc. NevadaDurante Holdings, LLC NevadaEast Beach Development Corporation MississippiEmerald Safari Resort (Pty) Limited 11 South Africa2Name Jurisdiction ofIncorporationFHR Corporation NevadaFHR Parent, LLC DelawareFlamingo CERP Manager, LLC NevadaFlamingo Las Vegas Operating Company, LLC NevadaFlamingo-Laughlin, LLC NevadaFlamingo-Laughlin Parent, LLC DelawareGB Investor, LLC DelawareGCA Acquisition Subsidiary, Inc. MinnesotaGNOC, Corp. New JerseyGolden Nugget Club Limited England/WalesGrand Casinos of Biloxi, LLC MinnesotaGrand Casinos of Mississippi, LLC - Gulfport MississippiGrand Casinos, Inc. MinnesotaGrand Media Buying, Inc. MinnesotaHAC CERP Manager, LLC New JerseyHarrah South Shore Corporation CaliforniaHarrah's (Barbados) SRL BarbadosHarrah's Activity Limited England/WalesHarrah's Arizona Corporation NevadaHarrah's Atlantic City Mezz 1, LLC DelawareHarrah's Atlantic City Mezz 2, LLC DelawareHarrah's Atlantic City Mezz 3, LLC DelawareHarrah's Atlantic City Mezz 4, LLC DelawareHarrah's Atlantic City Mezz 5, LLC DelawareHarrah's Atlantic City Mezz 6, LLC DelawareHarrah's Atlantic City Mezz 7, LLC DelawareHarrah's Atlantic City Mezz 8, LLC DelawareHarrah's Atlantic City Mezz 9, LLC DelawareHarrah's Atlantic City Operating Company, LLC New JerseyHarrah's Atlantic City Propco, LLC DelawareHarrah's BC, Inc. DelawareHarrah's Bossier City Investment Company, LLC LouisianaHarrah's Bossier City Management Company, LLC NevadaHarrah's Chester Downs Investment Company, LLC DelawareHarrah's Chester Downs Management Company, LLC NevadaHarrah's Entertainment Limited England/WalesHarrah's Illinois Corporation NevadaHarrah's Interactive Investment Company NevadaHarrah's International C.V . The NetherlandsHarrah's International Holding Company, Inc. DelawareHarrah's Investments, Inc. NevadaHarrah's Iowa Arena Management, LLC DelawareHarrah's Las Vegas, LLC NevadaHarrah's Laughlin, LLC NevadaHarrah's Management Company NevadaHarrah's Maryland Heights Operating Company NevadaHarrah's MH Project, LLC DelawareHarrah's NC Casino Company, LLC North CarolinaHarrah's New Orleans Management Company NevadaHarrah's North Kansas City LLC MissouriHarrah's Operating Company Memphis, LLC DelawareHarrah's Pittsburgh Management Company NevadaHarrah's Reno Holding Company, Inc. NevadaHarrah's Shreveport Investment Company, LLC NevadaHarrah's Shreveport Management Company, LLC NevadaHarrah's Shreveport/Bossier City Holding Company, LLC Delaware3Name Jurisdiction ofIncorporationHarrah's Shreveport/Bossier City Investment Company, LLC DelawareHarrah's Southwest Michigan Casino Corporation NevadaHarrah's Travel, Inc. NevadaHarrah's West Warwick Gaming Company, LLC DelawareHarveys BR Management Company, Inc. NevadaHarveys C.C. Management Company, Inc. NevadaHarveys Iowa Management Company, Inc. NevadaHarveys Tahoe Management Company, Inc. NevadaH-BAY, LLC NevadaHBR Realty Company, Inc. NevadaHCAL, LLC NevadaHCR Services Company, Inc. NevadaHEI Holding C.V. The NetherlandsHEI Holding Company One, Inc. NevadaHEI Holding Company Two, Inc. NevadaHET International 1 B.V. The NetherlandsHET International 2 B.V. The NetherlandsHHLV Management Company, LLC NevadaHIE Holdings Topco, Inc. DelawareHIE Holdings, Inc. DelawareHLV CERP Manager, LLC NevadaHole in the Wall, LLC NevadaHorseshoe Cincinnati Management, LLC DelawareHorseshoe Cleveland Management, LLC DelawareHorseshoe Entertainment LouisianaHorseshoe Gaming Holding, LLC DelawareHorseshoe GP, LLC NevadaHorseshoe Hammond, LLC IndianaHorseshoe Ohio Development, LLC DelawareHorseshoe Shreveport, L.L.C. LouisianaHTM Holding, Inc. NevadaInter Casino Management (Egypt) Limited Isle of ManJCC Holding Company II Newco, LLC DelawareJGB Vegas Retail Lessee, LLC 12 NevadaKoval Holdings Company, LLC DelawareKoval Investment Company, LLC NevadaLAD Hotel Partners, LLC 13 LouisianaLas Vegas Golf Management, LLC NevadaLas Vegas Resort Development, Inc. NevadaLaughlin CERP Manager, LLC NevadaLaundry Parent, LLC DelawareLCI (Overseas) Investments Pty Ltd. South AfricaLCI plc England/WalesLifeboat, Inc. LouisianaLondon Clubs (Overseas) Limited England/WalesLondon Clubs Brighton Limited England/WalesLondon Clubs Glasgow Limited ScotlandLondon Clubs Holdings Limited England/WalesLondon Clubs International Limited England/WalesLondon Clubs Leeds Limited England/WalesLondon Clubs Limited England/WalesLondon Clubs LSQ Limited England/WalesLondon Clubs Management Limited England/WalesLondon Clubs Manchester Limited England/WalesLondon Clubs Nottingham Limited England/WalesLondon Clubs Poker Room Limited England/Wales4Name Jurisdiction ofIncorporationLondon Clubs South Africa Limited England/WalesLondon Clubs Southend Limited England/WalesLondon Clubs Trustee Limited England/WalesLVH Corporation NevadaLVH Parent, LLC DelawareMartial Development Corporation New JerseyNevada Marketing, LLC NevadaNew Gaming Capital Partnership NevadaOcean Showboat, Inc. New JerseyOctavius Linq Holding Co., LLC DelawareOctavius/Linq Intermediate Holding, LLC DelawareOCZ Holdings Pte. Ltd. 14 SingaporeParball LLC NevadaParball Parent, LLC DelawareParis CERP Manager, LLC NevadaParis Las Vegas Operating Company, LLC NevadaPark Place Finance, ULC Nova ScotiaPH Employees Parent, LLC DelawarePHW Investments, LLC DelawarePHW Las Vegas, LLC NevadaPHW Manager, LLC NevadaPlayboy Club (London) Limited England/WalesPlayers Bluegrass Downs, Inc. KentuckyPlayers Development, Inc. NevadaPlayers Holding, LLC NevadaPlayers International, LLC NevadaPlayers LC, LLC NevadaPlayers Maryland Heights Nevada, LLC NevadaPlayers Resources, Inc. NevadaPlayers Riverboat II, LLC LouisianaPlayers Riverboat Management, LLC NevadaPlayers Riverboat, LLC NevadaPlayers Services, Inc. New JerseyR Casino Limited England/WalesR Club (London) Limited England/WalesReno Crossroads, LLC DelawareReno Projects, Inc. NevadaRio CERP Manager, LLC NevadaRio Development Company, Inc. NevadaRio Properties, LLC NevadaRio Property Holding, LLC NevadaRobinson Property Group Corp. MississippiRoman Entertainment Corporation of Indiana IndianaRoman Holding Corporation of Indiana IndianaRomulus Risk and Insurance Company, Inc. NevadaShowboat Atlantic City Mezz 1, LLC DelawareShowboat Atlantic City Mezz 2, LLC DelawareShowboat Atlantic City Mezz 3, LLC DelawareShowboat Atlantic City Mezz 4, LLC DelawareShowboat Atlantic City Mezz 5, LLC DelawareShowboat Atlantic City Mezz 6, LLC DelawareShowboat Atlantic City Mezz 7, LLC DelawareShowboat Atlantic City Mezz 8, LLC DelawareShowboat Atlantic City Mezz 9, LLC DelawareShowboat Atlantic City Operating Company, LLC New JerseyShowboat Atlantic City Propco, LLC Delaware5Name Jurisdiction ofIncorporationShowboat Holding, LLC NevadaShowboat Nova Scotia ULC Nova ScotiaSouthern Illinois Riverboat/Casino Cruises, Inc. IllinoisSterling Suffolk Racecourse, LLC 15 MassachusettsTahoe Garage Propco, LLC DelawareThe Caesars Foundation NevadaThe Quad Manager, LLC DelawareThe Sportsman Club Limited England/WalesThistledown Management, LLC DelawareTRB Flamingo, LLC NevadaTrigger Real Estate Corporation NevadaTunica Roadhouse Corporation DelawareTwain Avenue, Inc. NevadaVillage Walk Construction, LLC DelawareWindsor Casino Limited CanadaWinnick Holdings, LLC DelawareWinnick Parent, LLC DelawareWoodbury Manager, LLC Delaware 1 11.46% B I Gaming Corporation; 83.77% Harrah's International Holding Company, Inc.; 4.77% third party shareholders2 55% Baluma Holdings S.A.; 45% non-affiliate3 60% Harrah's Entertainment Limited.; 40% non-affiliate4 69% Caesars Entertainment Operating Company, Inc.: 20.2% CERP; 10.8% CGPH 5 89% Caesars Entertainment Corporation; 6% Management shareholders; 5% non-affiliates6 38.99% Caesars Acquisition Company; 61.01 % affiliates of Caesars Entertainment Corporation 7 99.5% Harrah's Chester Downs Investment Company, LLC; 0.5% third party shareholders8 7.5% Harrah's Interactive Investment Company; 92.5% non-affiliate9 80% Harrah's Illinois Corporation; 20% non-affiliate10 70% LCI (Overseas) Investments Pty Ltd.; 30% non-affiliate11 16.25% GB Investor, LLC; 83.75% non- affiliate12 49% Harrah's Bossier City Investment Company, LLC; 51% non-affiliate13 50% Caesars Korea Holding Company, LLC; 50% non-affiliate14 4.2% Caesars Massachusetts Investment Company, LLC; 95.8% non-affiliate 6Exhibit 23CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMWe consent to the incorporation by reference in Registration Statement Nos. 333-182385 and 333-204343 on Form S-8 and Registration Statement No. 333-180116 on Form S-3 of Caesars Entertainment Corporation of our report dated February 14, 2017 , relating to the consolidated balance sheets of CaesarsEntertainment Corporation and subsidiaries (the “Company”) as of December 31, 2016 and 2015 , and the related consolidated statements of operations andcomprehensive income/(loss), stockholders' equity/(deficit) and cash flows for each of the three years in the period ended December 31, 2016 , and theconsolidated financial statement schedules included in Item 15, which expresses an unqualified opinion on those consolidated financial statements and financialstatement schedules and included an emphasis of a matter paragraph regarding the Company’s majority owned subsidiary, Caesars Entertainment OperatingCompany, Inc. (CEOC) and certain of its U.S. subsidiaries filing for reorganization under Chapter 11 of the Bankruptcy Code, which resulted in the Companydeconsolidating CEOC effective January 15, 2015 and an explanatory paragraph regarding uncertainties that raise substantial doubt about the ability of theCompany to continue as a going concern; and of our report dated February 14, 2017 , on the Company's internal control over financial reporting as ofDecember 31, 2016 , which expressed an unqualified opinion on the Company's internal control over financial reporting, both appearing in the Annual Report onForm 10-K of Caesars Entertainment Corporation for the year ended December 31, 2016 ./s/ DELOITTE & TOUCHE LLPLas Vegas, NevadaFebruary 14, 2017Exhibit 31.1I, Mark P. Frissora, certify that:1.I have reviewed this annual report on Form 10-K of Caesars Entertainment Corporation;2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4.The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in ExchangeAct Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for theregistrant and have:a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, toensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within thoseentities, particularly during the period in which this report is being prepared;b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;c)evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; andd)disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recentfiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely tomaterially affect, the registrant's internal control over financial reporting; and5.The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the registrant's ability to record, process, summarize and report financial information; andb)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controlover financial reporting. Date:February 14, 2017 By:/S/ MARK P. FRISSORA Mark P. Frissora President and Chief Executive Officer Exhibit 31.2I, Eric Hession, certify that:1.I have reviewed this annual report on Form 10-K of Caesars Entertainment Corporation;2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4.The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in ExchangeAct Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for theregistrant and have:a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, toensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within thoseentities, particularly during the period in which this report is being prepared;b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;c)evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; andd)disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recentfiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely tomaterially affect, the registrant's internal control over financial reporting; and5.The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the registrant's ability to record, process, summarize and report financial information; andb)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controlover financial reporting. Date:February 14, 2017 By:/ S / ERIC HESSION Eric Hession Executive Vice President and Chief Financial OfficerExhibit 32.1Certification of Principal Executive OfficerPursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Caesars Entertainment Corporation (the“Company”), hereby certifies, to such officer's knowledge, that:(i)the accompanying Annual Report on Form 10-K of the Company for the year ended December 31, 2016 (the “Report”) fully complies with the requirementsof Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and(ii)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.Date:February 14, 2017 By:/S/ MARK P. FRISSORA Mark P. Frissora President and Chief Executive Officer The foregoing certification is being furnished solely to accompany the Report pursuant to 18 U.S.C. § 1350, and is not being filed for purposes of Section 18 of theSecurities Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filing of the Company, whether made before or after the datehereof, regardless of any general incorporation language in such filing.Exhibit 32.2Certification of Principal Executive OfficerPursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Caesars Entertainment Corporation (the“Company”), hereby certifies, to such officer's knowledge, that:(i)the accompanying Annual Report on Form 10-K of the Company for the year ended December 31, 2016 (the “Report”) fully complies with the requirementsof Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and(ii)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.Date:February 14, 2017 By:/ S / ERIC HESSION Eric Hession Executive Vice President and Chief Financial OfficerThe foregoing certification is being furnished solely to accompany the Report pursuant to 18 U.S.C. § 1350, and is not being filed for purposes of Section 18 of theSecurities Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filing of the Company, whether made before or after the datehereof, regardless of any general incorporation language in such filing.Exhibit 99.1GAMING REGULATORY OVERVIEWGeneralThe ownership and operation of casino entertainment facilities are subject to pervasive regulation under the laws, rules and regulations of each of thejurisdictions in which we operate. Gaming laws are based upon declarations of public policy designed to ensure that gaming is conducted honestly, competitivelyand free of criminal and corruptive elements. Since the continued growth and success of gaming is dependent upon public confidence, gaming laws protect gamingconsumers and the viability and integrity of the gaming industry, including prevention of cheating and fraudulent practices. Gaming laws may also be designed toprotect and maximize state and local revenues derived through taxation and licensing fees imposed on gaming industry participants and enhance economicdevelopment and tourism. To accomplish these public policy goals, gaming laws establish procedures to ensure that participants in the gaming industry meetcertain standards of character and fitness, or suitability. In addition, gaming laws require gaming industry participants to:•Establish and maintain responsible accounting practices and procedures;•Maintain effective controls over their financial practices, including establishment of minimum procedures for internal fiscal affairs and the safeguardingof assets and revenues;•Maintain systems for reliable record keeping;•File periodic reports with gaming regulators; and•Maintain strict compliance with various laws, regulations and required minimum internal controlspertaining to gaming.Typically, regulatory environments in the jurisdictions in which we operate are established by statute and are administered by a regulatory agency oragencies with interpretive authority with respect to gaming laws and regulations and broad discretion to regulate the affairs of owners, managers, andpersons/entities with financial interests in gaming operations. Among other things, gaming authorities in the various jurisdictions in which we operate:•Adopt rules and regulations under the implementing statutes;•Make appropriate investigations to determine if there has been any violation of laws or regulations;•Enforce gaming laws and impose disciplinary sanctions for violations, including fines and penalties;•Review the character and fitness of participants in gaming operations and make determinations regarding their suitability or qualification for licensure;•Grant licenses for participation in gaming operations;•Collect and review reports and information submitted by participants in gaming operations;•Review and approve transactions, such as acquisitions or change-of-control transactions of gaming industry participants, securities offerings and debttransactions engaged in by such participants; and•Establish and collect fees and/or taxes. 1Licensing and Suitability DeterminationsGaming laws require us, each of our subsidiaries engaged in gaming operations, certain of our directors, officers and employees, and in some cases, ourstockholders and holders of our debt securities, to obtain licenses or findings of suitability from gaming authorities. Licenses or findings of suitability typicallyrequire a determination that the applicant qualifies or is suitable. Gaming authorities have very broad discretion in determining whether an applicant qualifies forlicensing or should be deemed suitable. Subject to certain administrative proceeding requirements, the gaming regulators have the authority to deny any applicationor limit, condition, restrict, revoke or suspend any license, registration, finding of suitability or approval, or fine any person licensed, registered or found suitable orapproved, for any cause deemed reasonable by the gaming authorities. Criteria used in determining whether to grant a license or finding of suitability, whilevarying between jurisdictions, generally include consideration of factors such as:•The financial stability, integrity and responsibility of the applicant, including whether the operation is adequately capitalized in the jurisdiction andexhibits the ability to maintain adequate insurance levels;•The quality of the applicant's casino facilities;•The amount of revenue to be derived by the applicable jurisdiction through operation of the applicant's gaming facility;•The applicant's practices with respect to minority hiring and training; and•The effect on competition and general impact on the community. In evaluating individual applicants, gaming authorities consider the individual's reputation for good character and criminal and financial history and the characterof those with whom the individual associates.Many jurisdictions limit the number of licenses granted to operate gaming facilities within the jurisdiction, and some jurisdictions limit the number oflicenses granted to any one gaming operator. For example, in Indiana, state law allows us to only hold two gaming licenses. Licenses under gaming laws aregenerally not transferable unless the transfer is approved by the requisite regulatory agency. Licenses in many of the jurisdictions in which we conduct gamingoperations are granted for limited durations and require renewal from time to time. In Iowa, our ability to continue our casino operations is subject to a referendumevery eight years or at any time upon petition of the voters in the county in which we operate; the most recent referendum occurred in 2010. Our New Orleanscasino operates under a contract with the Louisiana gaming authorities which extends until 2018, with a ten-year renewal period. There can be no assurance thatany of our licenses or any of the above mentioned contracts will be renewed, or with respect to our gaming operations in Iowa, that continued gaming activity willbe approved in any referendum.Most jurisdictions have statutory or regulatory provisions that govern the required action that must be taken in the event that a license is revoked or notrenewed. For example, under Indiana law, a trustee approved by gaming authorities will assume complete operational control of our riverboat in the event ourlicense is revoked or not renewed, and will be authorized to take any action necessary to sell the property if we are unable to find a suitable buyer within 180 days.In addition to us and our direct and indirect subsidiaries engaged in gaming operations, gaming authorities may investigate any individual or entity having amaterial relationship to, or material involvement with, any of these entities to determine whether such individual is suitable or should be licensed as a businessassociate of a gaming licensee. Certain jurisdictions require that any change in our directors or officers, including the directors or officers of our subsidiaries, mustbe approved by the requisite regulatory agency. Our officers, directors and certain key employees must also file applications with the gaming authorities and maybe required to be licensed, qualified or be found suitable in many jurisdictions. Gaming authorities may deny an application for licensing for any cause which theydeem reasonable. Qualification and suitability determinations require submission of detailed personal and financial information followed by a thoroughinvestigation. The burden of demonstrating suitability is on the applicant, who must pay all the costs of the investigation. Changes in licensed positions must bereported to gaming authorities and in addition to their authority to deny an application for licensure, qualification or a finding of suitability, gaming authoritieshave jurisdiction to condition, limit, or disapprove of a change in a corporate position.If gaming authorities were to find that an officer, director or key employee fails to qualify or is unsuitable for licensing or unsuitable to continue having arelationship with us, we would have to sever all relationships with such person. In addition, gaming authorities may require us to terminate the employment of anyperson who refuses to file appropriate applications.2Moreover, in many jurisdictions, any of our stockholders or holders of our debt securities may be required to file an application, be investigated, and qualifyor have his, her or its suitability determined. For example, under Nevada gaming laws, each person who acquires, directly or indirectly, beneficial ownership of anyvoting security, or beneficial or record ownership of any non-voting security or any debt security in a public corporation which is registered with the NevadaGaming Commission (the “Commission”), such as Caesars Entertainment Corporation, may be required to be found suitable if the Commission has reason tobelieve that his or her acquisition of that ownership, or his or her continued ownership in general, would be inconsistent with the declared public policy of Nevada,in the sole discretion of the Commission. Any person required by the Commission to be found suitable shall apply for a finding of suitability within 30 days afterthe Commission's request that he or she should do so and, together with his or her application for suitability, deposit with the Nevada Gaming Control Board (the“Board”) a sum of money which, in the sole discretion of the Board, will be adequate to pay the anticipated costs and charges incurred in the investigation andprocessing of that application for suitability, and deposit such additional sums as are required by the Board to pay final costs and charges.Furthermore, any person required by a gaming authority to be found suitable, who is found unsuitable by the gaming authority, shall not be able to holddirectly or indirectly the beneficial ownership of any voting security or the beneficial or record ownership of any nonvoting security or any debt security of anypublic corporation which is registered with the gaming authority, such as Caesars Entertainment Corporation, beyond the time prescribed by the gaming authority.A violation of the foregoing may constitute a criminal offense. A finding of unsuitability by a particular gaming authority impacts that person's ability to associateor affiliate with gaming licensees in that particular jurisdiction and could impact the person's ability to associate or affiliate with gaming licensees in otherjurisdictions.Many jurisdictions also require any person who acquires beneficial ownership of more than a certain percentage of our voting securities and, in somejurisdictions, our non-voting securities, typically 5%, to report the acquisition to gaming authorities, and gaming authorities may require such holders to apply forqualification or a finding of suitability. Most gaming authorities, however, allow an “institutional investor” to apply for a waiver that allows the “institutionalinvestor” to acquire, in most cases, up to 15% of our voting securities without applying for qualification or a finding of suitability. An “institutional investor” isgenerally defined as an investor acquiring and holding voting securities in the ordinary course of business as an institutional investor, and not for the purpose ofcausing, directly or indirectly, the election of a majority of the members of our board of directors, any change in our corporate charter, bylaws, management,policies or operations, or those of any of our gaming affiliates, or the taking of any other action which gaming authorities find to be inconsistent with holding ourvoting securities for investment purposes only. An application for a waiver as an institutional investor requires the submission of detailed information about thecompany and its regulatory filings, the name of each person that beneficially owns more than 5% of the institutional investor's voting securities or other equivalentand a certification made under oath or penalty for perjury, that the voting securities were acquired and are held for investment purposes only. Even if a waiver isgranted, an institutional investor generally may not take any action inconsistent with its status when the waiver was granted without once again becoming subjectto the foregoing reporting and application obligations. A change in the investment intent of an institutional investor must be reported to certain regulatoryauthorities immediately after its decision.Notwithstanding, each person who acquires directly or indirectly, beneficial ownership of any voting security, or beneficial or record ownership of anynonvoting security or any debt security in our company may be required to be found suitable if a gaming authority has reason to believe that such person'sacquisition of that ownership would otherwise be inconsistent with the declared policy of the jurisdiction.Generally, any person who fails or refuses to apply for a finding of suitability or a license within the prescribed period after being advised it is required bygaming authorities may be denied a license or found unsuitable, as applicable. The same restrictions may also apply to a record owner if the record owner, afterrequest, fails to identify the beneficial owner. Any person found unsuitable or denied a license and who holds, directly or indirectly, any beneficial ownership ofour securities beyond such period of time as may be prescribed by the applicable gaming authorities may be guilty of a criminal offense. Furthermore, we may besubject to disciplinary action if, after we receive notice that a person is unsuitable to be a stockholder or to have any other relationship with us or any of oursubsidiaries, we:•pay that person any dividend or interest upon our voting securities;•allow that person to exercise, directly or indirectly, any voting right conferred through securities held by that person;•pay remuneration in any form to that person for services rendered or otherwise; or•fail to pursue all lawful efforts to require such unsuitable person to relinquish his voting securities•including, if necessary, the immediate purchase of said voting securities for cash at fair market value.3Although many jurisdictions generally do not require the individual holders of debt securities such as notes to be investigated and found suitable, gamingauthorities may nevertheless retain the discretion to do so for any reason, including but not limited to, a default, or where the holder of the debt instrumentsexercises a material influence over the gaming operations of the entity in question. Any holder of debt securities required to apply for a finding of suitability orotherwise qualify must generally pay all investigative fees and costs of the gaming authority in connection with such an investigation. If the gaming authoritydetermines that a person is unsuitable to own a debt security, we may be subject to disciplinary action, including the loss of our approvals, if without the priorapproval of the gaming authority, we:•pay to the unsuitable person any dividend, interest or any distribution whatsoever;•recognize any voting right by the unsuitable person in connection with those securities;•pay the unsuitable person remuneration in any form; or•make any payment to the unsuitable person by way of principal, redemption, conversion, exchange, liquidation or similar transaction. Certain jurisdictions impose similar restrictions in connection with debt securities and retain the right to require holders of debt securities to apply for a license orotherwise be found suitable by the gaming authority.Under New Jersey gaming laws, if a holder of our debt or equity securities is required to qualify, the holder may be required to file an application forqualification or divest itself of the securities. If the holder files an application for qualification, it must place the securities in trust with an approved trustee. If thegaming regulatory authorities approve interim authorization, and while the application for plenary qualification is pending, such holder may, through the approvedtrustee, continue to exercise all rights incident to the ownership of the securities. If the gaming regulatory authorities deny interim authorization, the trust shallbecome operative and the trustee shall have the authority to exercise all the rights incident to ownership, including the authority to dispose of the securities and thesecurity holder shall have no right to participate in casino earnings and may only receive a return on its investment in an amount not to exceed the actual cost of theinvestment (as defined by New Jersey gaming laws). If the security holder obtains interim authorization but the gaming authorities later find reasonable cause tobelieve that the security holder may be found unqualified, the trust shall become operative and the trustee shall have the authority to exercise all rights incident toownership pending a determination on such holder's qualifications. However, during the period the securities remain in trust, the security holder may petition theNew Jersey gaming authorities to direct the trustee to dispose of the trust property and distribute proceeds of the trust to the security holder in an amount not toexceed the lower of the actual cost of the investment or the value of the securities on the date the trust became operative. If the security holder is ultimately foundunqualified, the trustee is required to sell the securities and to distribute the proceeds of the sale to the applicant in an amount not exceeding the lower of the actualcost of the investment or the value of the securities on the date the trust became operative and to distribute the remaining proceeds to the state. If the securityholder is found qualified, the trust agreement will be terminated.Additionally, following the Reclassification, the Certificates of Incorporation of CEC and CEOC contain provisions establishing the right to redeem thesecurities of disqualified holders if necessary to avoid any regulatory sanctions, to prevent the loss or to secure the reinstatement of any license or franchise, or ifsuch holder is determined by any gaming regulatory agency to be unsuitable, has an application for a license or permit denied or rejected, or has a previouslyissued license or permit rescinded, suspended, revoked or not renewed. The Certificates of Incorporation also contain provisions defining the redemption price andthe rights of a disqualified security holder. In the event a security holder is disqualified, the New Jersey gaming authorities are empowered to propose anynecessary action to protect the public interest, including the suspension or revocation of the licenses for the casinos we own in New Jersey.Many jurisdictions also require that manufacturers and distributors of gaming equipment and suppliers of certain goods and services to gaming industryparticipants be licensed and require us to purchase and lease gaming equipment, supplies and services only from licensed suppliers.Violations of Gaming LawsIf we or our subsidiaries violate applicable gaming laws, our gaming licenses could be limited, conditioned, suspended or revoked by gaming authorities, andwe and any other persons involved could be subject to substantial fines. Further, a supervisor or conservator can be appointed by gaming authorities to operate ourgaming properties, or in some jurisdictions, take title to our gaming assets in the jurisdiction, and under certain circumstances, earnings generated during suchappointment could be forfeited to the applicable jurisdictions. Furthermore, violations of laws in one jurisdiction could result in disciplinary action in otherjurisdictions. As a result, violations by us of applicable gaming laws could have a material adverse effect on our financial condition, prospects and results ofoperations.4Reporting and Recordkeeping RequirementsWe are required periodically to submit detailed financial and operating reports and furnish any other information about us and our subsidiaries which gamingauthorities may require. Under federal law, we are required to record and submit detailed reports of currency transactions involving greater than $10,000 at ourcasinos and Suspicious Activity Reports (“SARCs”) if the facts presented so warrant. Some jurisdictions require us to maintain a log that records aggregate cashtransactions in the amount of $3,000 or more. We are required to maintain a current stock ledger which may be examined by gaming authorities at any time. Wemay also be required to disclose to gaming authorities upon request the identities of the holders of our debt or other securities. If any securities are held in trust byan agent or by a nominee, the record holder may be required to disclose the identity of the beneficial owner to gaming authorities. Failure to make such disclosuremay be grounds for finding the record holder unsuitable. In Indiana, we are required to submit a quarterly report to gaming authorities disclosing the identity of allpersons holding interests of 1% or greater in a riverboat licensee or holding company. Gaming authorities may also require certificates for our stock to bear alegend indicating that the securities are subject to specified gaming laws. In certain jurisdictions, gaming authorities have the power to impose additionalrestrictions on the holders of our securities at any time.Review and Approval of TransactionsSubstantially all material loans, leases, sales of securities and similar financing transactions by us and our subsidiaries must be reported to, or approved by,gaming authorities. Neither we nor any of our subsidiaries may make a public offering of securities without the prior approval of certain gaming authorities if thesecurities or the proceeds therefrom are intended to be used to construct, acquire or finance gaming facilities in such jurisdictions, or to retire or extend obligationsincurred for such purposes. Such approval, if given, does not constitute a recommendation or approval of the investment merits of the securities subject to theoffering. Changes in control through merger, consolidation, stock or asset acquisitions, management or consulting agreements, or otherwise, require prior approvalof gaming authorities in certain jurisdictions. Entities seeking to acquire control of us or one of our subsidiaries must satisfy gaming authorities with respect to avariety of stringent standards prior to assuming control. Gaming authorities may also require controlling stockholders, officers, directors and other persons havinga material relationship or involvement with the entity proposing to acquire control, to be investigated and licensed as part of the approval process relating to thetransaction.Certain gaming laws and regulations in jurisdictions we operate in establish that certain corporate acquisitions opposed by management, repurchases ofvoting securities and corporate defense tactics affecting us or our subsidiaries may be injurious to stable and productive corporate gaming, and as a result, priorapproval may be required before we may make exceptional repurchases of voting securities (such as repurchases which treat holders differently) above the currentmarket price and before a corporate acquisition opposed by management can be consummated. In certain jurisdictions, the gaming authorities also require priorapproval of a plan of recapitalization proposed by the board of directors of a publicly traded corporation which is registered with the gaming authority in responseto a tender offer made directly to the registered corporation's stockholders for the purpose of acquiring control of the registered corporation.Because licenses under gaming laws are generally not transferable, our ability to grant a security interest in any of our gaming assets is limited and may besubject to receipt of prior approval from gaming authorities. A pledge of the stock of a subsidiary holding a gaming license and the foreclosure of such a pledgemay be ineffective without the prior approval of gaming authorities in certain jurisdictions. Moreover, our subsidiaries holding gaming licenses may be unable toguarantee a security issued by an affiliated or parent company pursuant to a public offering, or pledge their assets to secure payment of the obligations evidencedby the security issued by an affiliated or parent company, without the prior approval of certain gaming authorities. We are subject to extensive prior approvalrequirements relating to certain borrowings and security interests with respect to our New Orleans casino. If the holder of a security interest wishes operation of thecasino to continue during and after the filing of a suit to enforce the security interest, it may request the appointment of a receiver approved by Louisiana gamingauthorities, and under Louisiana gaming laws, the receiver is considered to have all our rights and obligations under our contract with Louisiana gamingauthorities.Some jurisdictions also require us to file a report with the gaming authority within a prescribed period of time following certain financial transactions and theoffering of debt securities. Were they to deem it appropriate, certain gaming authorities reserve the right to order such transactions rescinded.Certain jurisdictions require the implementation of a compliance review and reporting system created for the purpose of monitoring activities related to ourcontinuing qualification. These plans require periodic reports to senior management of our company and to the regulatory authorities.Certain jurisdictions require that an independent audit committee oversee the functions of surveillance and internal audit departments at our casinos.5License Fees and Gaming TaxesWe pay substantial license fees and taxes in many jurisdictions, including the counties, cities, and any related agencies, boards, commissions, or authorities,in which our operations are conducted, in connection with our casino gaming operations, computed in various ways depending on the type of gaming or activityinvolved. Depending upon the particular fee or tax involved, these fees and taxes are payable either daily, monthly, quarterly or annually. License fees and taxesare based upon such factors as:•a percentage of the gross revenues received;•the number of gaming devices and table games operated;•franchise fees for riverboat casinos operating on certain waterways; and•admission fees for customers boarding our riverboat casinos. In many jurisdictions, gaming tax rates are graduated with the effect of increasing as gross revenues increase. Furthermore, tax rates are subject to change,sometimes with little notice, and we have recently experienced tax rate increases in a number of jurisdictions in which we operate. A live entertainment tax is alsopaid in certain jurisdictions by casino operations where entertainment is furnished in connection with the selling or serving of food or refreshments or the selling ofmerchandise. Operational RequirementsIn many jurisdictions, we are subject to certain requirements and restrictions on how we must conduct our gaming operations. In many jurisdictions, we arerequired to give preference to local suppliers and include minority-owned and women-owned businesses in construction projects to the maximum extentpracticable.Some jurisdictions also require us to give preferences to minority-owned and women-owned businesses in the procurement of goods and services. Some ofour operations are subject to restrictions on the number of gaming positions we may have, the minimum or maximum wagers allowed by our customers, and themaximum loss a customer may incur within specified time periods.Our land-based casino in New Orleans operates under a casino operating contract (the "COC") with the State of Louisiana Gaming Control Board, assumingthe regulatory authority, control and jurisdiction of the Louisiana Economic Development Control Board pursuant to Louisiana Revised Statute 27:15.Pursuant to the terms and conditions of the COC, our New Orleans casino is subject to not only many of the foregoing operational requirements, but also torestrictions on our food and beverage operations, including with respect to the size, location and marketing of eating establishments at our casino entertainmentfacility. Furthermore, with respect to the hotel tower, we are subject to restrictions on the number of rooms within the hotel, the amount of meeting space withinthe hotel and how we may market and advertise the rates we charge for rooms.In Mississippi, we are required to include adequate parking facilities (generally 500 spaces or more) in close proximity to our existing casino complexes, aswell as infrastructure facilities, such as hotels, that will amount to at least 25% of the casino cost. The infrastructure requirement was increased to 100% of thecasino cost for any new casinos in Mississippi.To comply with requirements of Iowa gaming laws, we have entered into management agreements with Iowa West Racing Association, a non-profitorganization. The Iowa Racing and Gaming Commission has issued a joint license to Iowa West Racing Association and Harveys Iowa Management Company,Inc. for the operation of the Harrah's Council Bluffs Casino, which was an excursion gambling boat, but is now full-service, land-based casino. The companyoperates the casino pursuant to the management agreements.The United Kingdom Gambling Act of 2005 which became effective in September 2007, replaced the Gaming Act 1968, and removed most of therestrictions on adverting. Though the 2005 Act controls marketing, advertising gambling is now controlled by the Advertising Standards Authority through a seriesof codes of practice. Known as the CAP codes, the codes offer guidance on the content of print, television and radio advertisements.In Indiana, we are required to submit a quarterly report to gaming authorities disclosing the identity of all persons holding interests of 1% or greater in ariverboat licensee or holding company.” Under an omnibus update to its rules, publicly traded companies are now exempt from this requirement. The amendmentto 68 IAC 1-31-1 went into effect in early January 20136Indian GamingThe terms and conditions of management contracts and the operation of casinos and all gaming on Indian land in the United States are subject to the IndianGaming Regulatory Act of 1988, (the “IGRA”), which is administered by the National Indian Gaming Commission, (the “NIGC”), the gaming regulatory agenciesof tribal governments, and Class III gaming compacts between the tribes for which we manage casinos and the states in which those casinos are located. IGRAestablished three separate classes of tribal gaming-Class I, Class II and Class III. Class I includes all traditional or social games solely for prizes of minimal valueplayed by a tribe in connection with celebrations or ceremonies. Class II gaming includes games such as bingo, pulltabs, punchboards, instant bingo and non-banked card games (those that are not played against the house) such as poker. Class III gaming includes casino-style gaming such as banked table games likeblackjack, craps and roulette, and gaming machines such as slots and video poker, as well as lotteries and pari-mutuel wagering. Harrah's Ak-Chin and Harrah'sResort Southern California (Rincon) provide Class II gaming and, as limited by the tribal-state compacts, Class III gaming. Harrah's Cherokee currently providesonly Class III gaming. IGRA prohibits all forms of Class III gaming unless the tribe has entered into a written agreement or compact with the state that specifically authorizes thetypes of Class III gaming the tribe may offer. These compacts may address, among other things, the manner and extent to which each state will conductbackground investigations and certify the suitability of the manager, its officers, directors, and key employees to conduct gaming on tribal lands. We have receivedour permanent certification from the Arizona Department of Gaming as management contractor for the Ak-Chin Indian Community's casino, a Tribal-StateCompact Gaming Resource Supplier Finding of Suitability from the California Gambling Control Commission in connection with management of the Rincon SanLuiseno Band of Indians casino, and have been licensed by the relevant tribal gaming authorities to manage the Ak-Chin Indian Community's casino, the EasternBand of Cherokee Indians' casino and the Rincon San Luiseno Band of Indians' casino, respectively.IGRA requires NIGC approval of management contracts for Class II and Class III gaming as well as the review of all agreements collateral to themanagement contracts. Management contracts which are not so approved are void. The NIGC will not approve a management contract if a director or a 10%stockholder of the management company:•is an elected member of the Native American tribal government which owns the facility purchasing or leasing the games;•has been or is convicted of a felony gaming offense;•has knowingly and willfully provided materially false information to the NIGC or the tribe;•has refused to respond to questions from the NIGC; or•is a person whose prior history, reputation and associations pose a threat to the public interest or to effective gaming regulation and control, or create orenhance the chance of unsuitable activities in gaming or the business and financial arrangements incidental thereto. In addition, the NIGC will not approve a management contract if the management company or any of its agents have attempted to unduly influence anydecision or process of tribal government relating to gaming, or if the management company has materially breached the terms of the management contract or thetribe's gaming ordinance, or a trustee, exercising due diligence, would not approve such management contract. A management contract can be approved only afterthe NIGC determines that the contract provides, among other things, for:•adequate accounting procedures and verifiable financial reports, which must be furnished to the tribe;•tribal access to the daily operations of the gaming enterprise, including the right to verify daily gross revenues and income;•minimum guaranteed payments to the tribe, which must have priority over the retirement of development and construction costs;•a ceiling on the repayment of such development and construction costs; and•a contract term not exceeding five years and a management fee not exceeding 30% of net revenues (as determined by the NIGC); provided that the NIGCmay approve up to a seven year term and a management fee not to exceed 40% of net revenues if NIGC is satisfied that the capital investment required,and the income projections for the particular gaming activity require the larger fee and longer term.• 7Management contracts can be modified or canceled pursuant to an enforcement action taken by the NIGC based on a violation of the law or an issueaffecting suitability.Indian tribes are sovereign with their own governmental systems, which have primary regulatory authority over gaming on land within the tribes' jurisdiction.Therefore, persons engaged in gaming activities, including the company, are subject to the provisions of tribal ordinances and regulations on gaming. Theseordinances are subject to review by the NIGC under certain standards established by IGRA. The NIGC may determine that some or all of the ordinances requireamendment, and that additional requirements, including additional licensing requirements, may be imposed on the management company. The possession of validlicenses from the Ak-Chin Indian Community, the Eastern Band of Cherokee Indians and the Rincon San Luiseno Band of Indians, are ongoing conditions of ouragreements with these tribes.Riverboat CasinosIn addition to all other regulations applicable to the gaming industry generally, some of our riverboat casinos are also subject to regulations applicable tovessels operating on navigable waterways, including regulations of the U.S. Coast Guard. These requirements set limits on the operation of the vessel, mandate thatit must be operated by a minimum complement of licensed personnel, establish periodic inspections, including the physical inspection of the outside hull, andestablish other mechanical and operational rules.RacetracksWe own slot machines at a thoroughbred racetrack in Bossier City, Louisiana, and we own a combination harness racetrack and casino in southeasternPennsylvania in which the company, through various subsidiary entities, owns a 99.5% interest in the entity licensed by the Pennsylvania Gaming Control Board.In addition, regulations governing racetracks are typically administered separately from our other gaming operations, with separate licenses and license feestructures. For example, racing regulations may limit the number of days on which races may be held. In Kentucky, we own and operate Bluegrass Downs, aharness racetrack located in Paducah.In 2015, we divested our 20% interest in Rock Ohio Caesars, LLC, a venture with Rock Ohio Ventures, LLC (formerly Rock Gaming, LLC); however,certain company subsidiaries continued as the employers and managers of the Ohio properties during part of 2016. Between March and June 2016, themanagement agreements of the Ohio properties terminated, and the employees of the three Ohio properties were transferred to the owner of each respectiveproperty.InternetAn affiliate of the Company, Caesars Interactive Entertainment, Inc., engages in lawful real money online internet gaming activity in the United Kingdomthrough two outside third party operators. This internet gaming is offered to residents of the United Kingdom by the third party operators pursuant to remote casinooperating licenses issued to these operators by the Gambling Commission, following the implementation of the point of consumption licensing regime from 1November 2014. To date, the key gaming regulatory authorities governing online internet gaming are the UK Gambling Commission, the Gibraltar RegulatoryAuthority, the Alderney Gambling Control Commission and the Isle of Man Gambling Supervision Commission. Italy and France also legalized online internetgaming by private companies and, in June 2010, Denmark passed legislation legalizing online internet gaming. Caesars Interactive Entertainment, Inc., recentlyentered into agreements with third parties for the use of the World Series of Poker brand on online gaming websites in Italy and France. In addition, the State ofNevada legalized real money online internet poker within the State. The Nevada Gaming Commission adopted regulations and established licensing requirementsfor the operation of real money online internet poker in the State of Nevada. Caesars Interactive Entertainment, Inc., obtained the appropriate licenses in Nevadaand, pursuant to a relationship with a third party software provider, field trial operation of its real money website began in September 2013. The State of NewJersey also legalized real money online internet gaming within the State. The New Jersey regulators adopted regulations and established licensing requirements forthe operation of real money online internet gaming in the State of New Jersey. Caesars Interactive Entertainment New Jersey, LLC, a wholly owned subsidiary ofCaesars Interactive Entertainment, Inc., obtained a casino license and was issued an Internet Gaming Permit, pursuant to relationships with two third softwareproviders, operation of its real money websites began in November 2013.8

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