<PAGE>


                               ASSET PURCHASE AGREEMENT

DATED:   September 20, 1996

PARTIES: New Palace Casino, L.L.C.
         a Mississippi Limited Liability Company      "Buyer",
    
         Maritime Group, Ltd.,
         a Mississippi corporation                          "Company"


                                       RECITALS


    A.   The Company, a wholly owned subsidiary of Palace Casinos, Inc., a 
Utah corporation ("Palace"), owns and operates a dockside gaming casino known 
as the Palace Casino (the "Casino") in Biloxi, Mississippi.

    B.   On December 1, 1994, Palace and the Company each filed petitions for 
reorganization under Chapter 11 of the United States Bankruptcy Code, 11 
U.S.C. Section 101 et seq., as amended, (the "Code") with the United States 
Bankruptcy Court for the District of Utah.  Venue of the bankruptcy cases was 
subsequently transferred to the United States Bankruptcy Court for the 
Southern District of Mississippi (the "Bankruptcy Court").

    C.   The Buyer desires to acquire the Casino and substantially all of the 
assets of the Company relating to the Casino, and the Company desires to sell 
the Casino and substantially all of the assets of the Company relating to the 
Casino to Buyer.

    D.   The purchase and sale of the Casino will be accomplished by a sale 
pursuant to Section 363 of the Code (the "Section 363 Sale") in accordance 
with the Bidding Procedures described in Section 9.

<PAGE>

                                      Section I

                                 INDEX TO DEFINITIONS

    The definitions of the following terms used In this Agreement can be 
found in the following Sections:

<TABLE>
<CAPTION>
DEFINED TERMS                                                                 SECTION
<S>                                                                     <C>
Annual Earn Out Payments                                                3. 1 (iii)(a)
Approval to Participate Period                                                   13.4
Assumed Obligations                                                               2.2
Bankruptcy Court                                                            Recital B
Bidding Procedures Motion                                                         9.3
Bidding Procedures Order  9.3
Breakup Fee                                                              9.3 (b) (11)
Business                                                                          2.2
Business Records                                                                  7.2
Buyer's Deposit                                                                   9.2
Cash                                                                              3.1
Casino                                                                      Recital A
Closing Date                                                                     13.1
Code                                                                        Recital B
Contracts                                                                         2.2
CRC                                                                           3.1(11)
Debenture                                                                     3.1(11)
Deposit                                                                        9.3(b)
Earn Out Payment                                                             3.1(111)
Escrow Agent                                                                      3.3
Escrow Agreement                                                                  2.2
Excluded Assets                                                                   2.3
Final Order                                                                      10.2
Financed Property                                                                 2.2
Gross Gaming Revenues                                                        3.1(111)
HSR Act                                                                           8.3
IGT Order                                                                        10.6
IGT Motion                                                                       10.6
Leases                                                                            5.5
Liquidated Damages                                                               12.4
Outstanding Chips and Tokens                                                   2.3(e)
Palace                                                                      Recital A
Permitted Encumbrances                                                            5.2
Purchase Price                                                                    3.1
Sale Assets                                                                 2.1 & 5.3
Sale Motion                                                                       9.1
Section 363 Sale                                                            Recital D


                                       2


<PAGE>

Slot Club                                                                     2.1 (c)
Software Licenses                                                             2.1 (d)
</TABLE>

                                      Section 2

                             PURCHASE AND SALE OF ASSETS

    2.1  PURCHASE AND Sale.  Subject to all the terms and conditions of this 
Agreement and for the consideration herein stated, on the Closing Date, the 
Company agrees to sell, convey, assign, transfer and deliver to Buyer, and 
Buyer agrees to purchase and accept from the Company, the Casino and all its 
related assets, properties and rights (other than the Excluded Assets 
specified in Section 2.3), tangible and intangible, relating thereto (the 
"Sale Assets") free and clear of all liens, claims and encumbrances, except 
Permitted Encumbrances, which Sale Assets include but are not limited to, the 
following:

    (a)  the Casino, the barges and all items of tangible personal property 
of the Company comprising or relating to the Casino, such as furniture,, 
fixtures, equipment, materials, inventory and spare and replacement items 
therefor, including without limitation all such items listed on SCHEDULE 2.1 
(a), and all such items acquired by the Company after the date September 22, 
1995, and on or before the Closing Date, other than to the extent such items 
(x) are disposed of by Company prior to the Closing Date without breach of 
this Agreement or (y) are Excluded Assets;

    (b)  the real property described on SCHEDULE 2.1 (b);

    (c)  all software licenses ("Software Licenses") granted to the Company 
with respect to the computer programs used in the operation of the Casino as 
a gaming establishment (the "Business") which Buyer elects to assume pursuant 
to Section 2.2;

    (d)  to the extent transferable, all approvals, authorizations, consents, 
licenses, permits and other registrations of any federal, state or local 
court or other governmental department, commission, board, bureau, agency or 
instrumentality held by the Company and related to the Business, which are 
listed on SCHEDULE 2.1 (d), other than to the extent such items (x) have 
terminated, expired or been disposed of by the Company prior to the Closing 
Date without breach of this Agreement or (y) are related to the Excluded 
Assets;

    (e)  all operating data and records relating to the Business other than 
to the extent such items relate to the Excluded Assets;

    (f)  all assignable rights, if any, to all telephone lines and numbers 
used in the Business, including without limitation those lines and numbers 
listed on SCHEDULE 2.1 (f), other than those lines and numbers that relate 
solely to the Excluded Assets;

    (g)  the Leases which Buyer, in its sole discretion, elects to assume 
pursuant to Section 2.2;



                                       3


<PAGE>

    (h)  the Contracts which Buyer, in its sole discretion, elects to assume 
pursuant to Section 2.2;

    (i)  The Financed Property and related financing agreements which Buyer, 
in its sole discretion, elects to purchase and assume pursuant to Section 2.2.
    
    (j)  The tradenames Palace and Palace Casino and related logos, 
trademarks and servicemarks, if any and. without warranty, to the extent of 
Company's ownership of said tradenames and related logos, trademarks and 
servicemarks.

    2.2  ASSUMPTION OF LEASES AND CONTRACTS.  At least two days prior to the 
hearing on the Sale Motion (as defined in Section 9.1 below), Buyer will 
provide a list of obligations it will assume of the Company, and at least 
twenty days prior to closing, Buyer will provide a list of any additional 
obligations it-will assume of the Company (together, the "Assumed 
Obligations") in respect of (a) the personal property leases relating to the 
equipment located at the Casino and any or all land and ground leases listed 
on Schedule 2.2(a) (the "Leases"); (b) the contracts, agreements, including 
Software Licenses and insurance policies listed on Schedule 2.2(b) (the 
"Contracts"); and (c) the items of personal property listed on Schedule 
2.2(c) (the "Financed Property").  The Company will secure, prior to the 
Closing Date, Bankruptcy Court approval of Company's assumption of the Leases 
and Contracts listed by Buyer and the assignment of those Leases and 
Contracts to Buyer.  If Buyer provides a list of additional Leases and 
Contracts after the hearing on the Sale Motion but prior to a date at least 
twenty (20) days prior to Closing, the Company will secure Bankruptcy Court 
approval of Company's designated Leases and Contracts and assignment thereof 
to Buyer.  The Company will cooperate with Buyer in seeking necessary 
approval for transfer of Financed Property to Buyer.  The Company will cure 
defaults on the Leases and Contracts except those listed In Section 5.5 
below, provided, however,, that if a non-current payment default is in excess 
of $50,000, the Company need not cure such a default in excess of said amount 
and, in such instance, Buyer can (i) withdraw its request that that Lease or 
Contract be assumed by the Company and assigned to Buyer, (ii) cure the 
default, in excess of $50,000, or (iii) terminate this Agreement.  With 
respect to any Financed Property assumed by Buyer, Buyer will use its best 
efforts to secure for the Company a release of all of the Company's 
obligations and liabilities relating to such Financed Property.  Buyer will 
not assume any of the Company's Accounts Payable Claims unless specifically 
addressed in the Assumed Obligations.

    2.3  EXCLUDED ASSETS.  The Sale Assets shall not include the following 
(the "Excluded Assets"):

         (a)  all cash (including cage cash), operating accounts and 
long-term investments of the Company;

         (b)  the corporate seal, minute books, charter documents., corporate 
stock record books and stock certificates of the Company;

         (c)  all claims, demands, causes of action and other rights which 
the Company has or may have against third parties;


                                       4


<PAGE>

         (d)  the Leases, Contracts and Financed Property that Buyer does not 
assume pursuant to Section 2.2;

         (e)  all of the Company's obligations with respect to outstanding 
Slot Club points and except as provided in Section 2.4(a), the Slot Club.

         (f)  such of the Company's rights under any insurance policies which 
are not assigned to Buyer pursuant to Section 2.2, hereof; and

         (g)  the Company's rights under this Agreement.

         (h)  Insurance policies listed on Schedule 2.3(h).

    2.4  ASSUMED LIABILITIES.  Buyer shall assume ONLY those liabilities 
listed below (the "Assumed Liabilities"):

         (a)  Such of the Company's obligations with respect to the Crown 
Jewel Slot Club (the "Slot Club") as are accepted by Buyer at the closing, in 
its sole discretion after Buyer's review and audit of the Company's Slot Club 
obligations.

         (b)  Subject to the adjustment provided in Section 3.3(b), the 
Company's obligations with respect to outstanding chips and tokens (the 
"Outstanding Chips and Tokens").

         (c)  Those liabilities as specifically agreed to in terms and 
conditions with regard to those Leases, Contracts and Financed Property 
assumed by Buyer pursuant to Section 2. 1 (g), 2.1(h), 2.1(i) and 2.2 hereof.

    Buyer agrees to assume and become responsible for all of the Assumed 
Liabilities as specifically detailed and agreed to at Closing.  Except for 
Permitted Encumbrances, the Buyer will not assume or have any responsibility, 
however, with respect to any other obligation, liability or claim against the 
Company or Sale Assets.  The Purchase Price was determined and agreed to by 
Company and Buyer on the basis of Buyer assuming only the Assumed Liabilities 
and having no responsibility for any other obligation, liability or claim 
against the Company.  Company- acknowledges that the Purchase Price would be 
substantially reduced in the absence of a Final Order which does not 
authorize and direct the sale of the Sale Assets to Buyer free and clear of 
all liens, claims and encumbrances (except Permitted Encumbrances).

    Company agrees that subsequent to the execution of this Agreement by 
Buyer and Company that it will not, without Buyer's prior written approval,. 
renegotiate or modify, or attempt to renegotiate any Lease, Contract or 
agreement affecting or governing the Financed Property.


                                      Section 3

                                    PURCHASE PRICE


                                       5


<PAGE>

    3.1  PURCHASE PRICE.  The total consideration (the "Purchase Price") for 
the Sale Assets shall be Fourteen Million Two Hundred Fifty Thousand Dollars 
($14,250,000), (which sum is an addition to the Assumed Liabilities) payable:

    (i)  Eleven Million Five Hundred Thousand Dollars ($11,500,000) cash (the 
"Cash") at the Closing;

    (ii) One Million Five Hundred Thousand Dollars ($1,500,000) in the form 
of a convertible debenture of Casino Resource Corporation, a Minnesota 
Corporation ("CRC") (the "Debenture").  The Debenture shall bear interest at 
the rate of six percent (6%) per annum, with principal and interest being due 
and payable upon the earlier to occur of (x) twenty-four months after the 
Closing Date, or (y) Buyer's sale of the Casino prior to the expiration of 
twenty-four months after the Closing Date, and payable by CRC, in the sole 
discretion of CRC, in cash or in the fully registered and freely tradable 
common stock of CRC pursuant to the further provisions of this Section 3.1 
(II).  For the purposes of this Section 3.1 (11) Payment Date means the date 
the Debenture becomes due and payable hereunder.  If converted to CRC common 
stock, CRC must use its best efforts to insure that the stock is fully 
registered and tradeable at the Payment Date; however, if the common stock is 
not fully registered and tradeable at the payment date through no fault of 
CRC, there will be a thirty (30) day grace period after the Payment Date for 
the stock to become fully registered and tradeable (the "Grace Period").  If 
the common stock is not fully registered and tradeable after the expiration 
of the Grace Period, the Debenture must be immediately paid in cash by CRC.  
The number of shares into which the Debenture may be converted at the option 
of CRC shall be determined by dividing the total amount of unpaid principal 
and accrued interest of the Debenture by the average of the per share bid and 
asked prices of CRC stock for the ten (10) day period ending on and including 
the due date of the Debenture on the exchange where CRC shares are then 
listed; and

    (iii)     One Million Two Hundred Fifty Thousand Dollars ($1,250,000) 
subject to and payable pursuant to the further provisions of this Section 3.1 
(iii) (the "Earn Out Payment").

    The Earn Out Payment (which shall not exceed $1,250,000.00 in total 
Annual Earn Out Payments) shall be calculated and paid as follows:

    (a)(i) For each of the first through sixth twelve month periods following 
the Closing Date, Buyer shall make annual payments ("Annual Earn Out 
Payments") to Company of a sum equal to (x) Three Percent (3%) of the excess, 
IF ANY, by which an amount equal to the total of Gross Gaming Revenues from 
Buyer's operation of the Casino from the Closing Date to the then applicable 
Payment Date exceeds the total of $2,666,667 multiplied by the number of 
months from the Closing Date to the then applicable Payment Date reduced by 
(y) the total of Annual Earn Out Payments previously made to Company by Buyer 
hereunder.
    
         (ii) For each of the seventh through twelfth twelve month periods 
following the Closing Date, Buyer shall make Annual Earn Out Payments to 
Company of a sum equal to (x) Two Percent (2%) of the excess, IF ANY, by 
which an amount equal to the total of Gross Gaming Revenues from Buyer's 
Operation of the Casino from the Closing Date to the



                                       6


<PAGE>

then applicable payment date exceeds the total of $2,666,667 multiplied by 
the number of months from the Closing Date to the then applicable Payment 
Date reduced by (y) the total of Annual Earn Out Payments previously made to 
Company by Buyer under this Section 3. 1 (iii) (a)(i) and (ii), hereof.

    (b)  Upon the earlier to occur of (x) the twelfth anniversary of the 
Closing Date; or (y) the payment to Company of $1,250,000 in cumulative 
Annual Earn Out Payments, Buyer's obligation to make Annual Earn Out Payments 
to Company cease and Buyer shall have no further obligation to Company 
hereunder.

    (c)  Company shall have no obligation to repay to Buyer any portion of 
the Earn Out Payment previously paid to it by Buyer.

    (d)  For the purposes of this Section 3.1 (iii), Gross Gaming Revenues 
from Buyer's operation of the Casino shall be calculated the same as 
calculated for the purpose of the payment of license fees under the 
Mississippi Gaming Control Act, as now or hereafter amended., and the 
regulations now or hereafter promulgated under such Act.

    (e)  Each Annual Earn Out Payment required to be made to Company 
hereunder shall be made no later than forty-five (45) days after the 
applicable Payment Date and shall be accompanied by (x) Buyer's calculation 
of the Annual Earn Out Payment required to be made to Company in connection 
with the then applicable Payment Date; (y) Buyer's calculation of Gross 
Gaming Revenues from the Closing Date to the then applicable Payment Date; 
and (z) financial reports and returns filed by Buyer with the Mississippi 
Gaming Commission for the applicable Annual Earn Out Payment period.

    (F)  In the event Buyer sells the Casino prior to the twelfth anniversary 
of the Closing Date, or in the event of a Change of Ownership of Buyer, and 
at the time of said Change of Ownership or sale (1) the Company has earned at 
least one Annual Earn Out Payment, or (11) the total of Gross Gaming Revenues 
from Buyer's operation of the Casino from the Closing Date to the date of the 
sale of the Casino or Change of Ownership of Buyer exceeds the total of 
$2,666,667 multiplied by the number of months from the Closing Date to the 
date of the sale of the Casino or Change of Ownership of Buyer, Buyer shall 
pay to the Company the then remaining unpaid portion of the Earn Out Payment 
equal to $11,250,000 reduced by the total of Annual Earn Out Payments 
previously made to Company by Buyer under this Section 3.1 (iii).  If at the 
time of any sale of the Casino or Change of Ownership of Buyer, (x) Company 
has earned no Annual Earn Out Payment, or (y) the total of Gross Gaming 
Revenues from Buyer's Operation of the Casino from the Closing Date to the 
date of the sale of the Casino or Change of Ownership of Buyer. does not 
exceed the total of $2.,666.,667 multiplied by the number of months from the 
Closing Date to the date of sale of the Casino or Change of Ownership of 
Buyer, Buyer shall have no obligation to pay the Earn Out Payment to Company; 
in either case, Buyer shall have no further obligations to Company under this 
Section 3.1(iii).  For the purposes of this Agreement, Change of Ownership of 
Buyer means the sale or transfer, in one or more transactions, of more than 
fifty percent (50%) of the membership Interest in Buyer to persons or 
entities who, on the date hereof are not related or affiliated with Buyer's 
present members. In the event of the sale or transfer, in one or more 
transactions, of more than fifty percent (50%) of the membership interest in 
Buyer to persons or entities who are related or affiliated with Buyer's 
present members, Buyer shall remain obligated to Company for the Earn Out 
Payment under the provisions of this Section 3.1(iii).



                                       7


<PAGE>

    3.2  PAYMENT OF PURCHASE PRICE.  The Purchase Price shall be paid by the 
delivery at closing by Buyer of (a) the cash specified in Section 3.1 (1) 
(reduced by any sum deposited by Buyer with Escrow Agent and payable to 
Company in accordance with the terms of the Escrow Agreement) by wire 
transfer of immediately available funds and (b) delivery of CRC's convertible 
debenture as specified in Section 3.1 (11).  Company shall instruct Buyer in 
writing regarding the wire transfer at least two business days before the 
Closing Date.

    3.3  REDUCTION OF PURCHASE PRICE.

    (a)(i) In the event any of the representations and warranties of the 
Company specified in Section 5.3(b) are not true as of the Closing and such 
condition is not waived by Buyer, and except for the items listed on Schedule 
3.3(a), and as otherwise provided in 3.3(a)(Iv) and (v), the Purchase Price 
shall be reduced to the extent the cost to repair or replace any defective, 
damaged, malfunctioning or missing items included in the Sale Assets exceeds, 
in the aggregate, $50,000.  Provided however that in no event shall the 
reduction in purchase price hereunder exceed $250,000, unless otherwise 
agreed to in writing by Company and Buyer.

    (ii) No later than sixty (60) days after the execution of this Agreement 
by Company and Buyer, Buyer shall complete its due diligence inspection and 
review of the Sale Assets.  Upon completion of its due diligence review, 
Buyer shall provide Company with its list of defective, damaged 
malfunctioning or missing items for the purposes of this Section 3.3 
("List"). If within three (3) business days after Buyer provides the List to 
Company, Company and Buyer do not agree to the items included on the List and 
the cost to repair or replace said items, Company shall immediately provide 
said list to Moran & Seymour, Engineers, who shall determine the cost 
necessary to repair or, if necessary, replace said items to the extent 
necessary to make Company's representations and warranties in Section 5.3(b) 
true and correct as of the Closing.

    (iii) For the purposes of this Section 3.3,  the cost to repair or 
replace any such items shall be determined by Moran & Seymour, Engineers, who 
may secure and rely on, in its sole discretion, such bids, estimates or 
quotes as it deems necessary. The determination of Moran & Seymour as to the 
cost to repair or replace any such items, shall be final and binding on the 
Buyer and Company.  Moran & Seymour, Engineers, shall furnish its detailed 
written report to Company and Buyer of the cost to repair or replace the 
items fifteen (15) days after its receipt of the list referenced in Section 
3.3(a)(ii).

    (iv) In the event the cost to repair or replace said items as determined 
by Moran &  Seymour, Engineers, exceeds .$300,000 and Company and Buyer have 
not otherwise agreed to a reduction of purchase price in excess of $250,000, 
Buyer may at its option (x) close with the purchase price being reduced by 
$250,000, as provided by Section 3.3(a), or (y) terminate this Agreement.

    (v)  In lieu of the reduction in purchase price provided by Section 
3.3(a)(1), Company may, at its option and cost, and prior to the Closing, 
repair or replace any such defective, damaged, malfunctioning or missing item 
of the Sale Assets.  The Company's repair or replacement of any such item 
shall be subject to Buyer's approval, which shall not be unreasonably 
withheld.


                                       8


<PAGE>

    (vi) Company and Buyer agree that the Purchase Price shall not be reduced 
because of the  items listed on Schedule 3.3(a).

    (b)  The Purchase Price shall also be reduced by the sum of (1) one-half 
(1/2) of the Outstanding Chips and Tokens assumed by Buyer (pursuant to 
2.4(b)) to the extent the total of Outstanding Chips and Tokens does not 
exceed $ 72,066.00; (ii) by the amount of Outstanding Chips and Tokens in 
excess of $72,066.00 assumed by Buyer (pursuant to Section 2.4(a)); and (iii) 
by the amount of any lien or claim which results in a lien against the Sale 
Assets after closing and which is not a Permitted Encumbrance and results 
from a liability accruing prior to the Closing Date.

    3.4  ASSUMED LIABILITIES.  Company and Buyer acknowledge that no part of 
the Purchase Price is allocable to the Leases, Contracts and Financed 
Property assumed by Buyer pursuant to Section 2.2 or to Assumed Liabilities 
assumed by Buyer pursuant to Section 2.4.

    3.5  ALLOCATION OF PURCHASE PRICE.  The Purchase Price shall be allocated 
among the Sale Assets as provided on Schedule 3.5.

                                      Section 4

                       REPRESENTATIONS AND WARRANTIES OF BUYER

    Buyer represents and warrants to the Company as follows:

    4.1  AUTHORIZATION AND ENFORCEABILITY.  Buyer is a limited liability 
company, duly organized, validly existing and in good standing under the laws 
of the State of Mississippi, and has full power and authority to own, lease 
and operate its properties and to carry on its business as now conducted and 
as proposed to be conducted.  Buyer has taken all action necessary to 
authorize its execution, delivery and performance of this Agreement.  Buyer 
has duly executed and delivered this Agreement, and this Agreement is, and, 
upon execution and delivery thereof, will be, the valid and binding 
obligation of Buyer enforceable in accordance with its terms, except as 
enforceability may be limited by or subject to any bankruptcy, insolvency, 
reorganization, moratorium or other similar laws, now or hereafter in effect, 
relating to creditors, rights generally or by the availability of equitable 
remedies.

    4.2  COMPLIANCE.  The execution, delivery and performance of this 
Agreement by Buyer, the compliance by Buyer with the provisions of this 
Agreement, and the consummation of the transactions described herein will not 
conflict with or result in the breach of any of the terms or provisions of or 
constitute a default under:- (a) the. certificate of formation .or operating 
agreement of Buyer; (b) any note, indenture, mortgage,, deed of trust, loan 
agreement, lease or other agreement or instrument to which Buyer is a party 
or by which Buyer is bound; or (c) any statute or any order, rule or 
regulation or any decision of any court or regulatory authority or government 
body applicable to Buyer.

    4.3  LEGAL PROCEEDINGS.  There are no claims, actions, suits, inquiries, 
investigations or proceedings pending against Buyer relating to the 
transactions contemplated hereby before any federal, state or local court or 
other governmental or regulatory body, United States or foreign.


                                       9


<PAGE>

    4.4  BROKERS.  Buyer has no obligation to pay any fees or commissions to 
any broker, finder, agent or other intermediary in connection with the 
negotiation or consummation of the transactions contemplated hereby.  Neither 
the Company nor Palace shall be responsible for any such obligations of Buyer.

    4.5  CONSENTS.  No consent, approval, authorization, order, designation 
or declaration of any court or regulatory authority or governmental body, 
federal or other or third person is required to be obtained by Buyer nor is 
any filing or registration required to be made therewith by Buyer for the 
consummation of the transactions described in this Agreement and all other 
agreements and instruments reasonably necessary to complete the transactions 
contemplated by this Agreement.

                                      Section 5

                    REPRESENTATIONS AND WARRANTIES OF THE COMPANY

    The Company represents and warrants to Buyer as of the date hereof and as 
of the Closing Date as follows:

    5.1  AUTHORIZATION.  The Company is a corporation, duly organized, 
validly existing and in good standing under the laws of the State of 
Mississippi and has all requisite corporate power and authority to own and 
operate its properties and to carry on its business as now conducted.  The 
Company has taken all corporate action necessary to authorize its execution,, 
delivery and performance of this Agreement. The Company is a debtor in 
possession under Chapter 11 of the Code and, subject to the provisions of the 
Code, has full corporate power and authority to enter into this Agreement and 
to carry out the terms hereof.  The Company has duly executed and delivered 
this Agreement, and by virtue of the Final Order this Agreement will be its 
valid and binding obligation enforceable in accordance with its terms.

    5.2  NO ENCUMBRANCES.  As of the Closing and by virtue of the conveyance 
of the Sale Assets to the Buyer pursuant to the Final Order, there will be no 
mortgages, pledges, encumbrances or liens (including for real and personal 
property taxes) against any of the Sale Assets, except for items listed on 
Schedule 5.2 (the "Permitted Encumbrances")..

    5.3  SALE ASSETS.

    (a)  Except for Permitted Encumbrances, the Company will on the Closing 
Date have, good and marketable title to all of the Sale Assets free and clear 
of all mortgages, pledges, liens, conditional sales agreements, leases or 
other encumbrances of any kind or nature, except for Permitted Encumbrances 
or liens from which the Sale Assets will be sold free and clear pursuant to 
the Final Order.

    (b)  Except for the items listed on Schedule 3.3 (a) and the damaged, 
malfunctioning or missing items of personal property for which the purchase 
price may be reduced pursuant to Section 3.3 (a), all of the personal 
property included in the Sale Assets, whether owned or leased by Company, is, 
and will be on the Closing Date, in good operating condition and repair, 
reasonable wear and tear excepted, free from all defect or damage, 
functioning in the manner and for the


                                       10


<PAGE>


purpose intended and located at or on the Casino, including any and all 
mechanical and electrical equipment or systems.

    (c)  The Sale Assets including, but not limited to the Leases, Contracts 
and Financed Property, which Buyer elects to assume pursuant to Section 2.2, 
are assignable and transferable to Buyer without the consent of any other 
person or entity (or, if consent Is required such consent shall be given 
prior to entry of the Final Order), except for those items identified on 
Schedule 5.3 which Buyer may not assume without the consent of the secured 
party.

    5.4  BROKERS.  The Company has no obligation to pay any fees or 
commissions to any broker, finder, agent or other intermediary in connection 
with the negotiation or consummation of the transactions contemplated hereby. 
 Company will hold Buyer harmless from any fees, liabilities, cost or 
expenses in connection therewith.

    5.5  REAL PROPERTY AND TIDELANDS LEASES.  The Company warrants that it is 
not in arrears or will become current at closing if in arrears on any real 
property leases or on the tidelands lease with the State of Mississippi with 
following exceptions:

    (a)  Tidelands Lease - It is understood by Buyer that Company has been 
making monthly payments on lease instead of a yearly payment as designated 
therein.

    (b)  Gollott's Lease - It is understood by Buyer that the six month 
payments on Lease for future rent is in arrears in an amount of approximately 
$42,000.00.

    5.6  EMPLOYMENT CONTRACTS AND BENEFIT Plans.  Except as set forth on 
Schedule 5.6., the Company is not a party to any employment contract and has 
not adopted any employee benefit, retirement, pension, medical insurance, 
life insurance or other plan.  Buyer shall not assume nor shall it be 
responsible for any liability of Company with respect to any employment 
contract, employee benefit, retirement, pension, medical insurance, life 
insurance or other plan.

    5.7  FOOD AND BEVERAGE LICENSES.  Company's food and beverage licenses 
and permits are current, in good standing and Company is in compliance with 
all requirements of said licenses and permits.

    5.8  OUTSTANDING CHIPS AND TOKENS.  As of September 5, 1996, the 
Company's obligations with respect to Outstanding Chips and Tokens did not 
exceed $72,066.00.

                                      Section 6

                               COVENANTS OF THE COMPANY

    6.1  BANKRUPTCY COURT ORDER.  The Company shall, within five (5) business 
days, after the execution of this Agreement by Buyer and the Company, seek 
(i) an order by the Bankruptcy Court authorizing a Section 363 Sale of the 
Sale Assets to Buyer free and clear of all liens, claims and encumbrances 
(except Permitted Encumbrances) in accordance with the terms and provisions 


                                       11


<PAGE>

hereof ("Final Order"); and (ii) an order approving the Bidding Procedures 
described in Section 9.3 of this Agreement ("Bidding Procedures Order").

    6.2  ACCESS TO SALE ASSETS, PROPERTIES AND DOCUMENTS . Prior to the 
Closing Date, the Company shall, at Buyer's request, afford or cause to be 
afforded to Buyer and its authorized representatives reasonable access during 
normal business hours to the Casino for the purpose of inspecting the Sale 
Assets and all of Company's properties, documents, contracts, books and 
records pertaining to Company as Buyer may request.

    6.3  PRESERVATION OF SALE ASSETS.

    (a)  Except as otherwise required by law or expressly permitted or 
contemplated by this. Agreement, without the prior written consent of Buyer 
(which may not be unreasonably withheld), the Company SHALL NOT prior to 
Closing:.

    (i)  mortgage, pledge, otherwise encumber or subject to lien any of the 
Sale Assets or commit itself to do any of the foregoing, except for Permitted 
Encumbrances;

    (ii) Dispose of, or agree to dispose of any of the Sale Assets or lease 
or license to others (including officers and directors), or agree so to lease 
or license, any of the Sale Assets outside the ordinary course of business; or

    (iii)     cancel, fall to maintain in force or change any policy of 
insurance (including self-insurance) relating to the Sale Assets or any 
policy or bond providing substantially the same coverage, unless such 
cancellation or change is effective only on or, after the Closing.

    (b)  Except as otherwise required by law, permitted by this Agreement or 
an, order of the Bankruptcy Court, or where Buyer consents in writing to 
noncompliance with this subsection (b), the Company SHALL after the date of 
this Agreement and until the Closing use reasonable efforts to maintain all 
of the tangible Sale Assets in good operating condition, reasonable wear and 
tear excepted, consistent with past practices, and take all steps reasonably 
necessary to maintain the intangible Sale Assets.

                                      Section 7

                                   JOINT COVENANTS

    Buyer and the Company covenant and agree that they will act in accordance 
with the following:

    7.1  FURTHER ASSURANCES.  After the Closing, each of the parties will 
take such actions and execute and deliver to the other party such further 
documents, instruments of assignment, conveyance and transfer as, in the 
reasonable opinion of counsel to the requesting party, may be necessary (a) 
to ensure, complete and evidence the full and effective transfer of the Sale 
Assets to and assumption of the Assumed Obligations by Buyer pursuant to this 
Agreement and (b) to fully and completely consummate the transactions and 
agreements contemplated by this Agreement.


                                       12

<PAGE>

    7.2  ACCESS TO BOOKS AND Records.  After the closing, Buyer shall make 
available to the Company, Palace and Roy Anderson Corp and their respective 
attorneys, accountants and agents., during regular business hours, all 
business records, books of account, flies, invoices, and other materials 
relating to the Business prior to the Closing ("Business Records") that any 
such person reasonably requires in connection with any litigation, tax, 
insurance, employee, accounts, claims and other business matters relating to 
the Business prior to Closing or for the purpose of winding up the business 
and affairs of the Company.  Buyer and Company agree that Company and Roy 
Anderson Corp may make and keep copies of any or all of such Business 
Records.  Buyer agrees to maintain, or release to the Company or Palace, or 
to their respective successors or assigns, all Business Records until all 
proceedings in the Bankruptcy Court with respect to the Company and Palace 
are final.  Buyer agrees that it shall make available to the Company those 
former employees of the Company employed by Buyer after the Closing to assist 
in the winding up of the business and affairs each of the Company and Palace 
and resolving any disputed matters relating to periods prior to the Closing, 
so long as the requests made of such persons do not unreasonably interfere 
with the performance of the duties of such persons as employees of Buyer.  
The Company, Palace and Roy Anderson Corp shall bear all out-of-pocket costs 
and expenses associated with their requests under the terms of this Section 
7.2.

                                      Section 8

               ADDITIONAL AGREEMENTS BETWEEN BUYER AND THE COMPANY

    8.1  EMPLOYMENT MATTERS.  Company shall prepare and furnish to its 
employees any and all notices of the sale of the Sale Assets required by 
applicable federal or state law, including but not limited to the Workers 
Adjustment and Retraining Notification Act.  Company acknowledges that Buyer 
is under no obligation to hire as an employee or to offer to hire AS an 
employee any of Company's employees after the Closing.  Buyer may, in its 
sole discretion, after the date hereof, enter into discussions with any 
employee of the Company regarding potential employment arrangements between 
Buyer and such employee after the Closing Date.

    8.2  TAXES, TRANSFER OR SALES TAXES.  Company shall pay, or cause to be 
paid, all transfer, sales or similar taxes relating to or arising out of the 
sale and transfer of the Sale Assets to Buyer.  All property taxes shall be 
prorated at the time of closing.  No tax liability of Company will be assumed 
or charged to Buyer.

    8.3  REAL AND PERSONAL PROPERTY TAXES.

    (a)  All 1996 real and personal property taxes shall be prorated as of 
the Closing Date.  The Final Order shall provide that (x) the Sale Assets are 
purchased by Buyer free and clear of any lien or claim for Pre-Closing Date 
prorated real and personal property taxes ("Pre-Closing Date Prorated 
Taxes"), and (y) that the lien for the Pre-Closing Date prorated taxes shall 
attach to the Purchase Price paid by Buyer for the Sale Assets.  Company and 
Buyer agree that Buyer shall receive the benefit of any refund OR REDUCTION 
of 1 996 real and personal property taxes attributable to the period 
subsequent to the Closing Date resulting from any reduction in 1996 real and 
personal property taxes because of Company's protest or objection to the 
appropriate taxing authorities., or

                                       13


<PAGE>

otherwise, and that Company shall receive the benefit of any refund or 
reduction of Pre-Closing Date Prorated Taxes.

    (b)  Prior to the Closing, Company, to the extent required by the laws of 
the State of Mississippi, shall timely file a protest and objection to the 
assessed valuation of the Sale Assets as shown by the 1996 and 1997 real and 
personal property tax rolls published by Harrison County, Mississippi or 
other taxing authorities and/or shall file a motion with the Bankruptcy Court 
pursuant to the Code to reduce the 1996 and 1997 real and personal property 
taxes.  Buyer shall provide reasonable assistance to the Company, prior to 
the Closing, in the filing and prosecution of such protest and objection.  At 
Closing, Company shall execute such documents or assignments as may be 
necessary or reasonably requested by Buyer so that Buyer, in its name, may 
continue the prosecution of such protest and objection after the Closing.  
After the Closing and as Buyer may request, Company shall provide reasonable 
assistance to Buyer in the filing and prosecution of such protest and 
objection.

    8.4  HART-SCOTT-RODINO.  Buyer shall prepare and file with the Antitrust 
Division of the Federal Trade Commission all reports, if any, required to be 
flied in connection with the transactions contemplated hereby pursuant to the 
Hart-Scott-Rodino Antitrust Act of 1978 ("HSR Act").  Company shall cooperate 
with Buyer in the preparation of any report or filing required by the HSR Act 
and to the extent required by the HSR Act shall execute any such report or 
filing.

    8.5  MISSISSIPPI GAMING CONTROL ACT.  Buyer agrees that within fifteen 
(15) days after the execution of this Agreement by Buyer and the Company, 
Buyer will make application with the Mississippi Gaming Commission for all 
necessary approvals and licenses for Buyer's ownership and operation of the 
Casino required to consummate the transactions contemplated by this 
Agreement.  Buyer shall, unless otherwise provided by the terms and 
provisions of this Agreement, be obligated to close purchase of the Sale 
Assets no later than sixty (60) days after entry of the Final Order.  The 
time periods set forth in this section may be extended by mutual agreement of 
Buyer and Company.

    8.6  CONFIDENTIALITY.  Until the Closing of the Section 363 Sale, Buyer 
and Company shall keep confidential all information obtained from the other 
pursuant to this Agreement except that the provision of this Section 8.5 
shall not apply in respect of any information which (v) was already known to 
either of the parties at the time of receipt thereof from the other or (w) 
was readily available to the general public at the time of receipt thereof 
from the other or (x) subsequently becomes known to the general public 
through no fault or omission on the part of such party or (y) is subsequently 
disclosed by a third party, or (z)  is required to be disclosed by law or a 
governmental agency.  Company and Buyer shall require their respective 
officers, directors, employees, agents and representatives having access to 
confidential information to execute confidentiality agreements in the form 
mutually agreed to by the parties.

                                      Section 9

                               BIDDING/SALE PROCEDURES

    9.1  SALE PROCEDURES.  No later than five (5) business days after the 
execution of this Asset Purchase Agreement by Company, Company shall file a 
motion with the Bankruptcy Court to


                                       14


<PAGE>


approve the sale under this Agreement in accordance with its terms and 
provisions, including the Bidding/Sales Procedures described in this Section 
9, and shall further provide all notices to parties in interest required by 
the Bankruptcy Code and Bankruptcy Rules (the "Sale Motion").  Company shall 
also request the Bankruptcy Court to reduce the notice period to parties in 
interest to fifteen (15) days.

    9.2  BUYER'S DEPOSIT.  Upon execution of this Agreement by Buyer and 
Company and the Escrow Agreement by Buyer, Company and Escrow Agent, Buyer 
shall deposit the sum of $2,000,000.00 with the Escrow Agent ("Buyer's 
Deposit"), which sum shall be held by the Escrow Agent pursuant to the terms 
of the Escrow Agreement.

    9.3  BIDDING PROCEDURES.  No later than five (5) business days after the 
execution of this Asset Purchase Agreement by Buyer and Company, Company 
shall file a motion with the Bankruptcy Court to establish the bidding 
procedures set forth in this Section 9.3 and shall further provide all 
notices to parties in interest required by the Bankruptcy Code and Bankruptcy 
Rules of Court ("Bidding Procedures Motion").  Company shall also request the 
Bankruptcy Court to reduce the notice period to parties in interest to 
fifteen (15) days.  The order of the Bankruptcy Court approving the Bidding 
Procedures Motion shall provide ("Bidding Procedures Order"):

    (a)  Any competing bid must be for the Sale Assets only and must be flied 
with the Company, with a copy to Buyer, no later than seven (7) business days 
after entry of the Bidding Procedures Order.

    (b)  (i) Any competing bid ("Competing Bid") must be in the minimum 
amount of $14,000,000 and must be accompanied by a cashier's check in no less 
than $2,000,000.00 payable to the Escrow Agent (the "Deposit"), which sum 
shall be held by the Escrow Agent pursuant to the terms of the Escrow 
Agreement.  Any party submitting a Competing Bid shall execute the Escrow 
Agreement and be bound by its terms.  Any Competing Bid shall include a cash 
payment in the minimum amount of $14,000,000.  The Competing Bid shall be in 
writing, and shall be delivered to counsel for the Company with copies to 
counsel for the Buyer, along with the Deposit to the Escrow Agent.

          (ii)     Buyer may, by giving written notice to the Company, match 
the Highest Competing Bid ("Highest Competing Bid").  For the purposes of 
computing any match by Buyer of the Highest Competing Bid, the Purchase Price 
under Section 3.1 shall be considered as having a cash value of $ 1 3,000,000 
(the sum of the Cash and the Debenture., which sum shall be included in any 
match of the Highest Competing Bid by Buyer.  The Earn Out Payment under 
Section 3.1 (ill) above shall not be included in any match of the Highest 
Competing Bid by Buyer.  If the Buyer matches the Highest Competing Bid, the 
bidding procedure or process shall be terminated and no additional bids or 
offers from any entity, including the entity submitting the Highest Competing 
Bid, shall be accepted or considered by the Bankruptcy Court, the Company or 
any other party in interest.  In such event,.the Purchase Price set forth in 
Section 3.1 shall be amended to an amount equal to the Highest Competing Bid 
matched by Buyer and the respective rights, obligations and duties of Company 
and Buyer for Buyer's purchase of the Sale Assets shall be as otherwise set 
forth in this Agreement subject to the amendment of the Purchase Price as 
above provided.  If the Buyer does not match the Highest Competing Bid (which 
must include a minimum cash payment of $14,000.,000),, 



                                       15
<PAGE>

then upon a final order by the Bankruptcy Court approving the sale of the 
Sale Assets to the Highest Competing Bidder (x) $500,000 of the Deposit made 
by the Highest Competing Bidder shall become non-refundable and shall be 
applied by the Escrow Agent to the payment to Buyer of the sum of $500,000 as 
a Breakup Fee, and (y) Company shall pay to Buyer the Breakup Fee of 
$500,000, which sum shall be paid by the Escrow Agent from the Deposit of the 
Highest Competing Bidder as provided by this Section 9.3(b)(ii)(x).

    (c)  Buyer's Deposit shall be returned to Buyer (i) no later than one 
business day after a final order by the Bankruptcy Court denying the Sale 
Motion in favor of Buyer or which approves the sale of the Sale Assets to a 
competing bidder or (ii) unless waived by Buyer,. by November 4, 1996, if the 
Bankruptcy Court has not entered its Final Order approving the Sale Motion in 
favor of Buyer.

    (d)  Any sale of Sale Assets to a competing bidder shall include a 
minimum cash payment of $14,000,000.

    (e)  In the event the Buyer does not match the Highest Competing Bid and 
the sale of the Sale Assets to the party submitting the Highest Competing Bid 
does not close, this Agreement shall be reinstated, at Buyer's option, upon 
written notice to the Company.  In such event, no competing bids shall be 
accepted by Company and the sale of the Sale Assets to Buyer shall be upon 
the terms and conditions hereof with the closing to occur no later than sixty 
(60) days after Company's receipt of Buyer's notice hereunder.  In such 
event, Buyer shall pay the Buyer's Deposit to Escrow Agent to be held and 
distributed according to the terms hereof and the Escrow Agreement. In the 
event Buyer elects to reinstate this Agreement, Buyer may in its sole 
discretion apply the Breakup Fee to the Buyer's Deposit and the Cash portion 
of the Purchase Price.

    (f)  Upon execution of this Agreement, Company and Buyer shall confer 
with the Bankruptcy Court for the purposes of scheduling the notice periods 
to parties in interest and the hearings in connection with the Bidding 
Procedures Motion and Sales Motion.

    (g)  Within five business days after (x) Buyer determines that the 
Bankruptcy Court is unable, in accordance with the provisions of this Section 
9, to schedule the notice periods to parties in interest and the hearings in 
connection with the Bidding Procedures Motion and Sales Motion ("Notices and 
Hearings"), or (y) the Bankruptcy Court does not enter the Bidding Procedures 
Order or the Final Order as provided herein, Buyer may, in its sole 
discretion, terminate this Agreement upon written notice to the Company.  In 
either event Buyer's Deposit shall be paid to the Buyer by Escrow Agent 
within seventy-two (72) hours of Escrow Agent's receipt of Buyer's written 
notice requesting payment of Buyer's Deposit to it.  If Buyer does not 
terminate this Agreement as provided in this Section 9.3(g), Company and 
Buyer shall amend this Agreement in writing to extend the Notices and 
Hearings and the dates for entry of the Bidding Procedures Order and Final 
Order.

    9.4  ENTRY OF BIDDING PROCEDURES ORDER.  Unless waived by Buyer, the 
Bidding Procedures Order shall be entered by the Bankruptcy Court no later 
than two (2) days after the expiration of the fifteen (15) day notice period 
to parties in interest described in Section 9.3 of this Agreement.



                                       16


<PAGE>

    9.5  COMPANY SUPPORT OF MOTIONS.  Company shall actively support and seek 
-the approval of the Bidding Procedure Motion and Sale Motion by the 
Bankruptcy Court and parties in interest to whom notice is required by the 
Bankruptcy Code and Bankruptcy Rules.

                                      Section 10

                          CONDITIONS TO OBLIGATIONS OF BUYER

    The obligations of Buyer under Sections 2.1 and 3.1 are, at its option, 
subject to satisfaction, at or prior to Closing, of each of the following 
conditions:

    10.1 REPRESENTATIONS, WARRANTIES AND COVENANTS.  All representations and 
warranties of the Company made in this Agreement shall in all material 
respects be true and correct on and as of the Closing Date with the same 
force and effect as if made on and as of that date, except for changes 
permitted or required by this Agreement.  All of the terms, covenants, 
conditions and agreements set forth in this Agreement to be compiled with and 
performed by the Company at or prior to the Closing shall in all material 
respects have been complied with or performed thereby.

    10.2 FINAL ORDER.  An order, which has not been stayed, vacated or 
materially modified for a period of ten (10) days after its entry, in form 
acceptable to Counsel for Buyer, shall have been entered by the Bankruptcy 
Court (a) authorizing and directing a Section 363 Sale of the Sale Assets, in 
accordance with the terms of this Agreement, to Buyer free and clear, except 
for Permitted Encumbrances, of all liens, claims and encumbrances, including 
any lien for real and/or personal property taxes assessed or claimed by any 
taxing authority against the Sale Assets including, but not limited to, the 
City of Biloxi, Mississippi, Harrison County, Mississippi and the State of 
Mississippi ("Tax Lien"); (b) providing that an amount equal to the total of 
the Tax Liens shall be held separately by the Company and disbursed only by 
order of the Bankruptcy Court to the appropriate taxing authorities, in 
satisfaction of any such Tax Lien; (c) approving the assignment and 
assumption of the Assumed Obligations to be assumed by Buyer, in accordance 
with the terms of this Agreement; and (d)(1) finding that the Section 363 
Sale would not have been consummated by Buyer if Buyer or the Sale Assets 
were to be responsible for, or subject to, any liens, claims or encumbrances 
other than Permitted Encumbrances and (ii) that there will be no successor 
liability to Buyer or any lien or encumbrance affecting the Sale Assets 
(except Permitted Encumbrances) of the Company ("Final Order").  Unless 
waived by Buyer, the Final Order shall be entered no later than forty-five 
(45) days after the execution of this Agreement by Buyer and the Company.

    10.3 INSTRUMENTS OF CONVEYANCE.  The Company shall have delivered deeds, 
bills of sale, assignments and other instruments of conveyance with respect 
to the Sale Assets effecting the sale, transfer, assignment and conveyance of 
the Sale Assets, without warranty and without recourse to the Company, to 
Buyer or to such other person who is to receive the Sale Assets pursuant to 
the Final Order.

    10.4 ENVIRONMENTAL REPORT.  Company will provide an Environmental Update 
Report ("Report") on the Sea Products and Gulf Central Properties and the 4.5 
acre fee simple property owned by Company no later than thirty (30) days from 
the Company's execution of this Agreement, at the Company's sole cost, which 
environmental update report shall be subject to the approval of


                                       17


<PAGE>

the Buyer at its sole discretion.  Buyer may, in its sole discretion, require 
the Company to cure any environmental exceptions listed in said report to the 
extent the cost to cure said exceptions does not exceed $50,000.  To the 
extent the cost to cure any environmental exceptions listed in the Report 
exceeds $50,000, Buyer may, in its sole discretion, cancel its obligations 
hereunder or waive such costs in excess of $50,000.

    10.5 TITLE INSURANCE.  Title to Company's real property (referenced in 
2.1 (b)) and Company leasehold interests in the Leases (referenced in Section 
2.2(g) conveyed to Buyer hereunder shall be insurable by a title insurance 
company licensed in the State of Mississippi and acceptable to Buyer at 
standard rates on its standard form of title policy, subject only to such 
matters as may be waived in writing by Buyer at or prior to the Closing.  
Buyer shall be responsible for the premiums of any such title insurance 
policy.

    10.6 IGT ORDER.  The October 31, 1996, date referenced in Paragraph B of 
the Order Approving Partial Agreement of Debtor and IGT North America 
Regarding Slot Machines Subject to a Security Interest of IGT North America 
entered on August 21, 1 996, shall be extended to the earlier to occur of the 
Closing Date or the termination of this Agreement.

                                      Section 11

                       CONDITIONS TO OBLIGATIONS OF THE COMPANY

    The obligations of the Company under Section 2.1 are, at its option, 
subject to satisfaction, at or prior to the Closing, of each of the following 
conditions:

    11.1 REPRESENTATIONS, WARRANTIES AND Covenants.  All representations and 
warranties of Buyer made in this Agreement shall in all material respects be 
true and correct on and as of the Closing Date with the same force and effect 
as if made on and as of that date, except for changes contemplated, permitted 
or required by this Agreement.  All of the terms, covenants, conditions and 
agreements to be complied with and performed by Buyer on or prior to the 
Closing shall in all material respects have been complied with or performed 
thereby.

    11.2 ADVERSE PROCEEDINGS.  There shall not be in effect any injunction or 
restraining order issued by a court of competent jurisdiction against the 
consummation of the purchase and sale of the Sale Assets pursuant to this 
Agreement.

    11.3      FINAL ORDER.  A Final Order shall have been entered by the 
Bankruptcy Court.

    11.4 Purchase Price.  The Purchase Price required to be paid by Buyer 
under Section 3.1 shall have been delivered to the party or parties entitled 
thereto pursuant to the Final Order.

                                      Section 12

                                     TERMINATION


                                       18


<PAGE>

    12.1 RIGHT OF PARTIES TO TERMINATE.  In addition to either party's right 
to terminate as otherwise provided herein, this Agreement may be terminated: 
(a) by Buyer if the Company shall have breached any of its obligations 
hereunder in any material respect; or (b) by the Company if Buyer shall have 
breached any of its obligations hereunder in any material respect.  The Buyer 
shall have the right to terminate this Agreement or extend the Closing Date 
under this Agreement in the event that any of the Conditions to Obligations 
of the Buyer specified in Section 10 have not been fulfilled at or prior to 
the Closing Date unless waived by Buyer in its sole discretion.

    12.2 EFFECT OF TERMINATION.  If either Buyer or the Company decides to 
terminate this Agreement pursuant to Section 12. 1, or if Buyer decides to 
terminate this Agreement pursuant to Section 3.3 (a) (iv) or Section 9.3 (g), 
the terminating party shall promptly give written notice to the other party 
to this Agreement of such decision.  In the event of a termination pursuant 
to Section 1 2. 1, the parties shall be released from all liabilities and  
obligations arising under this Agreement (other than pursuant to Sections 
12.3 and 12.4 hereto with respect to the matters contemplated by this 
Agreement.

    12.3 BUYER'S REMEDIES.  If the Section 363 Sale falls to close as a 
consequence of a breach by the Company of any of its obligations under this 
Agreement, or in the event of any of the Conditions to Obligations of the 
Buyer specified in Section 10 have not been fulfilled at or prior to the 
Closing Date, the Escrow Agent shall deliver to Buyer, no later than seventy 
two (72) business hours after Buyer delivers its written request to Escrow 
Agent, the Buyer's Deposit and any amounts owing to Buyer pursuant to Section 
9.3. Buyer shall be entitled to specific performance by Company of the terms 
and provisions of the Agreement and its reasonable attorney fees and court 
costs.

    12.4 COMPANY'S REMEDIES.  In the event the Section 363 Sale falls to 
close as a consequence of a breach by the Buyer of its obligations under this 
Agreement, or in the event of any of the Conditions to Obligations of the 
Company specified in Sections 11.1 and 11.4 have not been fulfilled at the 
Closing Date, Buyer shall pay to Company as liquidated damages, and not as a 
penalty, the sum of $ 1 00,000 ("Liquidated Damages").  In such case, the 
Liquidated Damages shall be paid to Company by the Escrow Agent from the 
Buyer's Deposit no later than the tenth day following notice by either Buyer 
or Company of the termination of this Agreement resulting from the events 
described in this Section 12.4. The remainder of Buyer's Deposit, shall be 
paid to Buyer by Escrow Agent within twenty-four hours following such notice 
of termination.  Company's right to Liquidated Damages hereunder shall be 
Company's sole and exclusive remedy against Buyer for and breach or default 
by Buyer under this Agreement.

                                     Section 13

                                       CLOSING

    13.1 TIME AND PLACE OF CLOSING.   Except as may otherwise be provided 
herein or mutually agreed to in writing by Buyer and the Company, and 
provided this Agreement has not been terminated as provided by Section 12, 
the closing of the Section 363 Sale ("The Closing") shall take place at
such time as the parties mutually agrees but in no event earlier than thirty 
(30) days nor later than sixty (60) days after entry of the Final Order 
("Closing Date").  The Closing shall take place at



                                       19


<PAGE>

the offices of Hopkins, Crawley, Bagwell, Upshaw & Persons, 2701 24th Avenue, 
Gulfport, Mississippi 39501 or at such other location agreed to by the 
parties.
    
    13.2 OBLIGATIONS OF THE COMPANY AT CLOSING.  At the Closing, the Company 
shall deliver or cause to be delivered the following documents, and take such 
other actions as are identified below:

    (a)  the instruments of conveyance and transfer contemplated by Section 
10.3; and

    (b)  all other documents and instruments as may be necessary to 
consummate the transactions contemplated by this Agreement.

    13.3 OBLIGATIONS OF BUYER AT CLOSING.  At the Closing, Buyer shall 
deliver or cause to be delivered the following documents, and take such other 
actions as are identified below:

    (a)  the Purchase Price pursuant to Section 3.1; and

    (b)  all other documents and instruments as may be necessary to 
consummate the transactions contemplated by this Agreement, including the 
Security Agreement.

    13.4 APPROVAL TO PARTICIPATE.   If at the Closing, Buyer has not secured 
the necessary licenses or permits from the Mississippi Gaming Commission 
which are necessary to Buyer's ownership and operation of the Casino 
subsequent to the Closing Date, Company shall, provided Buyer has received an 
Approval to Participate or similar consent or permission from the Mississippi 
Gaming Commission, operate the Casino, pursuant to Company's existing gaming 
license, for a period not to exceed One Hundred Twenty (120) days after 
Closing ("Approval to Participate Period").  During the Approval to 
Participate Period, Company shall employ or contract with a general manager 
or managers selected from time to time by Buyer and who have been found 
suitable by the Mississippi Gaming Commission for such position.  Any such 
general manager selected by the Buyer shall have and exercise sole and 
exclusive management of the Casino and its operations during the Approval to 
Participate Period.

    During the Approval to Participate Period, Buyer shall be responsible for 
operating expenses, taxes, lease payments and losses incurred in the 
operation of the Casino.  All profits generated by the Casino during the 
Approval to Participate Period shall belong to and be the property of the 
Buyer.

                                      Section 14

                                       SURVIVAL

    Except as provided in the second sentence of this Section 14 all 
representations, warranties, covenants and agreements made in this Agreement 
or in any exhibit, schedule, certificate or agreement delivered in accordance 
with this Agreement shall survive the execution and delivery of this 
Agreement and the Closing Date.  The representations and warranties of the 
Company under


                                       20


<PAGE>

Section 5 and 6 hereof, and of the Buyer under Section 4 hereof, shall be 
extinguished and be of no further force or effect after the Closing Date.

                                      Section 15

                                   OTHER PROVISIONS

    15.1 SURVEY.  No later than thirty (30) days after Company's execution 
hereof., Company shall provide an updated survey of the Sea Products, Gulf 
Central and Gollott properties and the 4.5 acre fee simple parcel.

    15.2  BENEFIT AND ASSIGNMENT; THIRD PARTY BENEFICIARIES.  This Agreement 
shall be binding upon and shall inure to the benefit of the parties hereto 
and their respective successors and assigns.  Buyer may not assign its rights 
and obligations hereunder without the prior written approval of Company, 
which will not be unreasonably withheld.

    15.3      ENTIRE AGREEMENT.  This Agreement and the Schedules and 
Exhibits referred to herein constitute the entire agreement and understanding 
of the parties and supersede any and all prior agreements, arrangements and 
understandings relating to matters provided for herein.

    15.4 RISK OF LOSS.  The risk of loss or destruction of or damage of the 
Sale Assets, or .any of them, from any cause whatsoever at all times on or 
subsequent to execution of this Agreement and prior to the Closing Date shall 
be borne by the Company.

    15.5      FEES AND EXPENSES.  Each party shall be solely responsible for 
all costs and expenses incurred by it in connection with the negotiation, 
preparation and performance of and compliance with the terms of this 
Agreement.

    15.6 AMENDMENT, WAIVER.  Except in the case of either Company or Buyer 
reserving the unilateral right to waive a provision or a right reserved 
hereunder, the provisions of this Agreement, or any of them, may be amended 
or waived by an instrument in writing signed by the party against which 
enforcement of such amendment or waiver is sought.  Any waiver of any term or 
condition of this Agreement or any breach hereof shall not operate as a 
waiver of any other such term, condition or breach, and no failure to enforce 
any provision hereof shall operate as a waiver of such provision or of any 
other provision hereof.

    15.7 HEADINGS.  The headings are for convenience only and will not 
control or affect the meaning or construction of the provisions of this 
Agreement.

    15.8 GOVERNING LAW, JURISDICTION.   The construction and performance of 
this Agreement ill be governed by the laws of the State of Mississippi.  The 
Bankruptcy Court shall have exclusive jurisdiction with regard to all matters 
relating to the interpretation and enforcement of this Agreement for a period 
of one year following the Closing.  Thereafter, jurisdiction shall fie in any 
court of competent jurisdiction. 


                                       21


<PAGE>

    15.9 NOTICES.  Any notice, demand or request required or permitted to be 
given under the provisions of this Agreement (a) shall be in writing; (b) 
shall be delivered personally, Including by means of facsimile, overnight 
express delivery, -or- mailed by registered or certified mail, postage 
prepaid, and return receipt requested; (c) shall be deemed given"on the date 
of personal delivery, the date sent via facsimile, or on the date set forth 
on the return receipt or the overnight express delivery receipt; and (d) 
shall be delivered or mailed, to the addresses or facsimile numbers set forth 
below or to such other address as any party may from time to time direct:

    (a)  IF TO BUYER:

         New Palace Casino, L.L.C.
         Attn: Jack Pilger, President and CEO
         Casino Resource Corporation
         1719 Beach Blvd., Room 306
         Executive Place.  Building
         Biloxi, Mississippi 39531


         with copies to

         James B. Persons
         Hopkins, Crawley, Bagwell, Upshaw & Persons
         Attorneys at Law
         Post Office Box 1510
         2701 24th Avenue
         Gulfport, Mississippi 39501-4941 (601) 864-2200

         Arthur Curtis
         Greene & Curtis, L.L.P.
         Attorneys at Law
         1340 East Woodhurst
         Springfield, Missouri 65804
         (417)883-7678

     (b) IF TO THE COMPANY: 

         Maritime Group, Ltd.
         Attn: Dual Cooper
         158 Howard Avenue
         Biloxi Mississippi 39530
         (601) 432-8888

         with a copy to:

         LeBoeuf, Lamb, Greene & MacRae,, L.L.P.
         Attn: Kenneth L. Cannon., 11


                                       22


<PAGE>

         1000 Kearns Building 
         136 South Main Street
         Salt Lake City, Utah 84101
         Telephone No.: (801) 320-6700
         Facsimile No.: (801) 359-8256

    15.10     ATTORNEYS' FEES.   If suit or action is filed by any party to 
enforce the provisions of this Agreement or otherwise with respect to the 
subject matter of this Agreement, or otherwise with respect to the subject 
matter, of this Agreement the, prevailing party shall be entitled to recover 
from the other party reasonable attorneys' fees as fixed by the trial court 
and, if any appeal is taken from the decision of the trial court, reasonable 
attorneys' fees as fixed by the appellate court. . For purposes of this 
Agreement, the term "prevailing party" shall be deemed to include a party 
that successfully opposes a petition for review flied with an appellate court.

    15.11     ATTORNEYS' FEES.  Company and Buyer acknowledge that schedules 
2.1 (a), 2.1 (b); 2.2(b) and 2.2(c) attached hereto have been prepared as of 
September 22, 1995.  Company and Buyer agree to supplement this Agreement to 
amend each of the schedules hereto to reflect the current status of the 
matters and items listed on each of said schedules.  Said amended schedules 
shall be subject to the approval of Buyer.  The remaining schedules have been 
prepared as of the date hereof.

    15.2 COUNTERPARTS.  This Agreement may be executed in one or more 
counterparts, each of which will be deemed an original but all of which 
together will constitute one and the same instrument.

    IN WITNESS WHEREOF, the parties have executed this Asset Purchase 
Agreement as of the day and year first written above.

"Buyer"

New Palace Casino, L.L.C.          /s/ John J. Pilger
                             --------------------------------------------------
                             Name:       JOHN R. PILGER
                                  ---------------------------------------------
                             Title
                                  ---------------------------------------------

"Seller"

Maritime Group, Ltd.               /s/ Dual B. Cooper, Jr.
                             --------------------------------------------------
                             Name     DUAL B. COOPER, JR.
                                 ----------------------------------------------
                             Title       PRESIDENT & CEO
                                  ---------------------------------------------


                                       23


<PAGE>

                                       Form of

                                   ESCROW AGREEMENT

     THIS ESCROW AGREEMENT is entered into as of the 20th day of September, 
1996, by and among New Palace Casino, L.L.C., a Mississippi Limited Liability 
Company (the "Buyer"), Maritime Group, Ltd., a Mississippi Corporation (the 
"Company") and Hancock Bank, Gulfport, Mississippi (the "Escrow Agent"), 
pursuant to an Asset Purchase Agreement dated September 20th, 1996, (the 
"Agreement") between the Buyer and the Company.

     WHEREAS, Buyer and Company have entered into the Agreement whereby Buyer 
is acquiring substantially all of the assets of Company relating to the 
dockside gaming casino known as the Palace Casino; and

     WHEREAS, the Agreement contemplates the deposit of certain sums with the 
Escrow Agent ("Deposit") by Buyer or by an entity submitting a "Competing 
Bid" as provided by Section 9 of the Agreement; and

     WHEREAS, Buyer and the Company have agreed to the terms of this Escrow 
Agreement for the Escrow Agent to hold any Deposit made pursuant to Section 9 
of the Agreement in accordance with the following terms, conditions and 
instructions:

     1.   DEFINITIONS. The capitalized terms in this Escrow Agreement shall 
have the same definition ascribed to them in the Agreement unless otherwise 
defined herein.

                                      EXHIBIT A

    2.   ESCROW DEPOSIT. In the even Buyer, pursuant to Section 9.2 of the 
Agreement, makes a Deposit (the "Buyer's Escrow Funds") said sum shall be 
held by the Escrow Agent in accordance with the terms and provisions of this 
Escrow Agreement.  Immediately upon the receipt of the Buyer's Escrow Funds, 
the Escrow Agent shall deposit the Buyer's Escrow Funds in one or more

                                       1


<PAGE>

federally insured interest bearing accounts at Hancock Bank, Gulfport, 
Mississippi, to be held and disbursed by the Escrow Agent pursuant to the 
terms hereof.

     3.   ESCROW DEPOSIT BY OTHERS THAN BUYER. In the event a Competing Bid 
is made pursuant to Section 9.3(b) of the Agreement, the deposit made by any 
Competing Bidder shall be held by the Escrow Agent pursuant to the terms 
hereof ("Overbid Escrow Funds").  Immediately upon receipt of the Overbid 
Escrow Funds, the Escrow Agent shall deposit the Overbid Escrow Funds in one 
or more federally insured interest bearing accounts at Hancock Bank, 
Gulfport, Mississippi.  The Overbid Escrow Funds shall be held in account 
separate and distinct from those of the Buyer's Escrow Funds, shall be 
accounted for separately by the Escrow Agent and shall be disbursed by the 
Escrow Agent pursuant to the terms hereof.  Any Competing Bidder shall 
execute this Escrow Agreement and be bound by its terms.

     4.   BUYER'S ESCROW FUNDS. Escrow Agent shall disburse the Buyer's 
Escrow Funds as follows:

          a)   If by October 14, 1996, (unless waived by Buyer pursuant to 
the Agreement) the Bankruptcy Court does not enter the Bidding Procedures 
Order approving the Bidding Procedures set forth in Section 9.3 of the 
Agreement, the Escrow Agent shall, upon receipt of written notice from Buyer 
requesting payment of Buyer's Escrow Funds to it, pay over and deliver the 
Buyer's Escrow Funds to the Buyer within one business day of Escrow Agent's 
receipt of Buyer's written notice.

          b)   If the Bankruptcy Court enters its Final Order approving the 
Sale Motion in favor of Buyer, and, at the Closing, Buyer provides Escrow 
Agent and Company with written notice that all conditions to obligations of 
Buyer provided for in Section 10 of the Agreement have been satisfied or 
waived in writing by Buyer, the Escrow Agent shall pay over and deliver the 
Buyer's Escrow 


                                       2


<PAGE>

Funds to the Company (at the Closing), to be applied to the Purchase Price.  
If at the Closing, Buyer provides Escrow Agent and Company with written 
notice that all conditions to obligations of the Buyer provided for in 
Section 10 of the Agreement have not been satisfied and have not been waived 
in writing by Buyer, the Escrow Agent shall pay over and deliver the Buyer's 
Escrow Funds to the Buyer within seventy-two (72) hours of Escrow Agent's 
receipt of Buyer's written notice.

          c)   If by November 4, 1996, (unless waived by Buyer pursuant to 
the Agreement) the Bankruptcy Court does not enter its Final Order approving 
the Sale Motion in favor of Buyer in accordance with the terms of the 
Agreement, the Escrow Agent shall, upon receipt of written notice from Buyer 
requesting payment of Buyer's Escrow funds to it, pay over and deliver the 
Buyer's Escrow Funds to the Buyer within one business day of Escrow Agent's 
receipt of Buyer's written notice.

          d)   Buyer's Escrow Funds shall be returned to Buyer by Escrow 
Agent no later than one business day after the entry of an order by the 
Bankruptcy Court denying the Section 363 Sale in favor of Buyer or which 
approves the sale of the Sale Assets to a competing bidder.

          e)   Company and Escrow Agent acknowledge that Buyer's right and 
entitlement to return of the Buyer's Escrow Funds under paragraphs 4(a), 4(c) 
or 4(d), is absolute and that Company has no right to object to the payment 
and delivery to Buyer of the Buyer's Escrow Funds by Escrow Agent under 
paragraphs 4(a), 4(c) or 4(d), hereof.

          f)   If the Section 363 Sale does not close and Company is entitled 
to recover Liquidated Damages from Buyer as provided in Section 12.4 of the 
Agreement, Escrow Agent shall pay and deliver, from Buyer's Deposit, the sum 
of $100,000 to Company as to Liquidated Damages.  Payment of Liquidated 
Damages to company shall be made by the Escrow Agent no later than the tenth 
day following notice by either Buyer or Company of the termination of the 
Agreement as a

                                       3


<PAGE>

result of any of the events described in Section 12.4 of the Agreement.  The 
remainder of Buyer's Deposit shall be paid to Buyer by Escrow Agent within 
twenty-four (24) hours following such notice of termination.

     5.   OVERBID ESCROW FUNDS.

          a)   If the Buyer does not match the Highest Competing Bid, as 
provided by Section 9.3(b) of the Agreement, the Escrow Agent shall pay over 
and deliver to Buyer from the Overbid Escrow Funds the sum of $500,000 
("Breakup Fee") which sum shall be paid to Buyer by Escrow Agent no later 
than one business day after a final order by the Bankruptcy Court  approving 
the sale of the Sale Assets to the Highest Competing Bidder.

          b)   The Overbid Escrow Funds deposited by any Competing Bidder, 
other than the Highest Competing Bidder, shall be paid over and returned to 
each such Competing Bidder by the Escrow Agent no later than one business day 
after Final Order by the Bankruptcy Court approving the Section 363 Sale in 
favor of Buyer or the Highest Competing Bidder, as the case may be.

          c)   If the Buyer elects to match the Highest Competing Bid, as 
provided by Section 9.3(b) of the Agreement, the Escrow Agent shall pay over 
and deliver to the Highest Competing Bidder, the Overbid Escrow Funds 
deposited by it which sum shall be paid to the said Highest Competing Bidder 
no later than one business day after the Final Order by the Bankruptcy Court 
approving the Section 363 Sale in favor of Buyer.

     6.   NON-DISBURSEMENT OF LIQUIDATED DAMAGES. If at any time Escrow Agent 
receives written notification or instructions from Buyer to not disburse the 
Liquidated Damages ($100,000) portion of Buyer's Escrow Funds to Company, 
Escrow Agent shall continue to hold the Liquidated

                                       4


<PAGE>

Damages until Buyer and Company jointly agree to the disbursement of the 
Liquidated Damages or unless otherwise ordered by a Court of competent 
jurisdiction pursuant to a final order.

     7.   INTERPLEADER. In the event of a disagreement or presentation of 
adverse claims or demands or instructions to the Escrow Agent, the Escrow 
Agent may at its option, file a Complaint in the Interpleader for the purpose 
of having the respective rights of the Buyer and Company adjudicated, may 
deposit with the Court all documents and property held by it pursuant to its 
Escrow Agreement and Buyer and Company hereto agree to pay all costs, 
expenses and attorney's fees incurred by the Escrow Agent in such action, and 
said costs, expenses and fees may be included in any judgment rendered in any 
such interpleader action.  Any such action shall be filed in a federal or 
state court of competent jurisdiction located in Harrison County, Mississippi.

     8.   NOTICES, ETC.  Any notice provided for in this Escrow Agreement 
shall be in writing, deemed effective upon receipt and shall be personally 
delivered, or mailed registered or certified mail-return receipt requested, 
as follows:

                    (a)  To the Escrow Agent:
                         Hancock Bank
                         Attn:                    
                         One Hancock Plaza
                         Gulfport, Mississippi 39501

                    (b)  To Buyer:

                         New Palace Casino, L.L.C.
                         C/O Casino Resource Corporation
                         Attn: Jack Pilger, CEO
                         1719 Beach Boulevard, Suite 306
                         Biloxi, Mississippi 39531-5396
                         (601) 435-1976

                    with copies to:


                                       5


<PAGE>

                         James B. Persons
                         Hopkins, Crawley, Bagwell,
                         Upshaw & Persons
                         Attorneys at Law
                         Post Office Box 1510
                         2710 24th Avenue
                         Gulfport, Mississippi 39501-4941
                         (601) 864-2200

                         Arthur Curtis
                         Greene & Curtis, L.L.P.
                         Attorneys at Law
                         1340 East Woodhurst
                         Springfield, Missouri 65804
                         (417) 883-7678

                    (c)  To Company:

                         Maritime Group, Ltd.
                         Attn: Dual Cooper
                         158 Howard Avenue
                         Biloxi, Mississippi 39530
                         (601) 432-8888

                    with a copy to:

                         LeBoeuf, Lamb, Greene & MacRae, L.L.P.
                         Attn: Kenneth L. Cannon, II
                         1000 Kearns Building
                         136 South Main Street
                         Salt Lake City, Utah 84101
                         Telephone No.: (801) 320-6700
                         Facsimile No.: (801) 359-8256

                    (d)  To Competing Bidder
                         (as shown on signature page)

or to such other address or to such other persons as any of the parties 
hereto shall have last designated to the other parties hereto by like notice.

     9.   AMENDMENT; BINDING EFFECT; CONSTRUCTION. This Escrow Agreement: (a) 
may not be amended or modified except by an instrument in writing signed by 
each of Buyer and Company, (b) shall be binding upon and inure to the benefit 
of the parties hereto and their respective successors


                                       6


<PAGE>

and assigns, and (c) shall be governed by and construed in accordance with 
the laws of the State of Mississippi.

                              BUYER:
                              NEW PALACE CASINO, L.L.C.


                              BY:--------------------------------------------
                                   Its---------------------------------------



                              COMPANY:
                              MARITIME GROUP INC.


                              BY:--------------------------------------------
                                   Its---------------------------------------



                              ESCROW AGENT:
                              HANCOCK BANK


                              BY:--------------------------------------------
                                   Its---------------------------------------



                              COMPETING BIDDER:



                              BY:--------------------------------------------
                                   Its---------------------------------------

                              Address ---------------------------------------
                              Telephone -------------------------------------

Hancock Bank
Attn: Mr. William A. Abbott
Associate General Counsel
One Hancock Plaza
Gulfport, Mississippi 39501


                                       7


<PAGE>

     RE:  Escrow Agreement dated as of September 20, 1996, among News Palace
          Casino, L.L.C. ("Buyer"), Maritime Group, Ltd. ("Company"), and
          Hancock Bank ("Escrow Agent").

Dear Mr. Abbott:

     This letter confirms the agreement of New Palace Casino, L.L.C., to pay 
the fee of Hancock Bank for its services as Escrow Agent pursuant to the 
captioned Escrow Agreement in the amount of $750.00.

     At the time of any disbursement required by the terms of the Escrow 
Agreement, the Escrow Agent will be provided instructions as to the manner of 
payment, e.g., wire or bank check, by the party making the disbursement 
instruction.

                              New Palace Casino, L.L.C.



                              BY: /s/ John J. Pilger
                                  ----------------------------
                                   JOHN J. PILGER

                                       8


<PAGE>











                                  SCHEDULE 2.1(a)





<PAGE>






                               SCHEDULE 2.1(b)







<PAGE>


                              BILOXI, MISSISSIPPI
                               REAL ESTATE OWNED


                                OWEN               LOFTON        TRIPLETT
                         ----------------------------------------------------

Purchase Price                $300,000          $182,017          $131,942

Outstanding Loan                NONE             123,200            NONE

Payment                          N/A               2,505             N/A

Term                             N/A              5 YEAR             N/A

Interest Rate                    N/A                8%               N/A

Use                          PARKING LOT       RESIDENTIAL        RESIDENTIAL

Other                     OFF-SITE PARKING    NEXT TO CASINO    NEXT TO CASINO
                                                 PARKING           PARKING


<PAGE>







                               SCHEDULE 2.1 (d)






<PAGE>

                                  MISSISSIPPI
                             STATE TAX COMMISSION

                      Alcoholic Beverage Control Division
                              Post Office Box 540
                        Madison, Mississippi 39130-0540

                           Ph number (601) 856-1301
                           Fax Number (601) 856-1300

Ed Buelow, Jr., Chairman       William W. Tann, CPA      Harvey Johnson, Jr.
and Commissioner of Revenue    Associate Commissioner    Associate Commissioner

       Maritime Group, Ltd.                             Biloxi, MS Harrison

Your application for a Mississippi Alcoholic Beverage  ON PREMISES RETAILER 
Permit Located at 158 Howard Avenue and doing business as PALACE CASINO has 
been approved by the A.B.C. Division effective April 6, 1994 and will expire 
on April, 5, 1995 Permit Number 7319 must appear on  all of your 
correspondence and orders.

     The enclosed permit must at all times be prominently displayed on the 
designated premises in order to keep this permit in force.  You must file an 
application with the A.B.C. Division for renewal before the stated permit 
expiration date.

     Authorized members of the Alcoholic Beverage Control Division will at 
various intervals be inspecting your premises and examining your books and 
records.  Information concerning the ordering and distribution of beverages 
will be obtained from the Warehouse Department of the A.B.C. Division.

     Each permittee shall operate under the provisions of the Alcoholic 
Beverage Control Laws and the Rules and Regulations of the Commission.  It 
is, therefore, recommended that eh permittee review all of the Alcoholic 
Beverage Control Law and the Rules and Regulations of the Mississippi Code of 
1972, which list the causes for which permits must be revoked or suspended.  
In addition, you should take special notice of the following Sections of 
Mississippi Code 1972, which relate to the operation of retail establishments:

General Sections 67-1-37, 51,59, 71, 77, 81,    General Sections 27-71-23
 83, 35

Enforcement Sections 67-1-31, 91                Records Sections 27-71-25, 23

Distribution Sections 67-1-31,91                Enforcement Section 27

Package Section 67-1-75                         Taxes--27-71-5, 7, 9, 23, 29

Transfer of Permit Section 67-1-67

Permit Display & Renewal Section 67-1-55, 63


<PAGE>

     Please call or write the Alcoholic Beverage Control Division office for 
further information or advise.  We would prefer to help you avoid mistakes 
rather than penalize you after you have committed a violation.

                              Very truly yours,

                          /s/ JAMES K. SULLIVAN

                          James K. Sullivan, Director

<PAGE>

                 UNITED STATES FIDELITY AND GUARANTY COMPANY
                             BALTIMORE, MARYLAND
                              (A STOCK COMPANY)

                                                 BOND NUMBER: 32-0130-19710-94

KNOW ALL MEN BY THESE PRESENTS: THAT Maritime Group, Ltd. City of Biloxi 
State of Mississippi, as Principal and UNITED STATES FIDELITY AND GUARANTY 
COMPANY, of Baltimore, Maryland, as Surety, are held and firmly bound unto 
City of Biloxi as Obligee in the aggregate sum of One Thousand Dollars and 
no/100 Dollars ($1,000.00), lawful money of the United States, for the 
payment of which, well and truly to be made, we bind ourselves, our heirs, 
executers and administrators, successors and assigns, jointly, severally, and 
firmly by these presents.

     Signed, sealed and dated March 8, 1994.

     WHEREAS, the above bounden Principal has applied for License as General 
Contractor for the term beginning March 8, 1994.  This Bond is to cover the 
term said License.

     NOW, THEREFORE, if a license is granted to the said Principal, and if 
such LICENSEE shall during the life of said License faithfully observe all 
the Ordinances of said Obligee, and faithfully perform the duties required by 
Ordinance, rules or regulations and will save and keep harmless and indemnify 
said Obligee, form all actions, suits, costs, damages and expenses, including 
Attorney's Fees which shall or may at any time happen to come to it or for or 
on account of any injury or damage received or sustained by any person, then 
the above obligation shall be void; otherwise to be and remain in full force 
and effect.

     IT IS FURTHER UNDERSTOOD AND AGREED that this bond my be terminated by 
either party hereto delivering written notice of termination by Registered or 
Certified Mail to the other parities at least 30 days prior to the effective 
date of such termination; the surety, however, remaining liable fro any 
defaults under this Bond, committed prior to the expiration of such 30 day 
period.

                                                                        (Seal)
                         -----------------------------------------------------
                              UNITED STATES FIDELITY AND GUARANTY COMPANY

COUNTERSIGNED            /S/ T. HARTLEY MARSHALL
                         -----------------------------------------------------
                         Assistant Vice President
By       /S/
  -----------------      By /S/ THOMAS FITZGERALD
   Resident Agent          ---------------------------------------------------
                            Assistant Secretary


                          ACKNOWLEDGMENT OF SURETY
                            (Corporate Officer)

State of Maryland

On the 1st day of September, 1993, before me the undersigned officers, 
personally appeared T. Hartley Marshall and Thomas Fitzgerald, who 
acknowledged themselves to be the aforesaid officers of UNITED STATES 
FIDELITY AND GUARANTY COMPANY, a corporation, and that they as such officers, 
being authorized so to do, executed the foregoing instrument for the purposes 
therein contained, by signing the name of the corporation by themselves as 
such officers.

IN WITNESS WHEREOF, I have hereunto set my hand and official seal.

     /S/


<PAGE>

                                  MISSISSIPPI

                             STATE DEPARTMENT OF
                                   HEALTH

                               Hereby Grants A

                             Food Service Permit
                                     To

                             MARITIME GROUP LTD

            To Maintain and Operate A Food Service Establishment


Under The Name Of                       PALACE CASINO
                 -------------------------------------------------------------
                                         SHOWROOM BAR

Located At  103 HOWARD AVENUE   BILOXI, HARRISON
           -------------------------------------------------------------------

     This permit signifies compliance on the date of issue with the Food 
Service Sanitation Regulation of the Mississippi State Department of Health 
and is valid for a period of 12 months from the date of issue unless 
suspended or revoked.

         /S/                                        March 16, 1994
------------------------------                  ------------------------------
Issuing Official                                                          Date

         /S/                                        24F-C0894
------------------------------                  ------------------------------
State Health Officer                                                    Permit


Revised 12/92         Display For Public View-Non Transferable    Form No. 307





<PAGE>

                                  MISSISSIPPI

                             STATE DEPARTMENT OF
                                   HEALTH

                               Hereby Grants A

                             Food Service Permit
                                     To

                             MARITIME GROUP LTD

            To Maintain and Operate A Food Service Establishment


Under The Name Of                       PALACE CASINO
                 -------------------------------------------------------------
                                       RUBY SERVICE BAR

Located At  103 HOWARD AVENUE   BILOXI, HARRISON
           -------------------------------------------------------------------

     This permit signifies compliance on the date of issue with the Food 
Service Sanitation Regulation of the Mississippi State Department of Health 
and is valid for a period of 12 months from the date of issue unless 
suspended or revoked.

         /S/                                        March 16, 1994
------------------------------                  ------------------------------
Issuing Official                                                          Date

         /S/                                        24F-C0891
------------------------------                  ------------------------------
State Health Officer                                                    Permit


Revised 12/92         Display For Public View-Non Transferable    Form No. 307




<PAGE>

                                  MISSISSIPPI
                             STATE DEPARTMENT OF
                                   HEALTH

                               Hereby Grants A

                             Food Service Permit
                                     To

                             MARITIME GROUP LTD

            To Maintain and Operate A Food Service Establishment


Under The Name Of                       PALACE CASINO
                 -------------------------------------------------------------
                                     DIAMOND SERVICE BAR

Located At  103 HOWARD AVENUE   BILOXI, HARRISON
           -------------------------------------------------------------------

     This permit signifies compliance on the date of issue with the Food 
Service Sanitation Regulation of the Mississippi State Department of Health 
and is valid for a period of 12 months from the date of issue unless 
suspended or revoked.

         /S/                                        March 16, 1994
------------------------------                  ------------------------------
Issuing Official                                                          Date

         /S/                                        24F-C0890
------------------------------                  ------------------------------
State Health Officer                                                    Permit


Revised 12/92         Display For Public View-Non Transferable    Form No. 307




<PAGE>

                                  MISSISSIPPI
                             STATE DEPARTMENT OF
                                   HEALTH

                               Hereby Grants A

                             Food Service Permit
                                     To

                             MARITIME GROUP LTD

            To Maintain and Operate A Food Service Establishment


Under The Name Of                       PALACE CASINO
                 -------------------------------------------------------------
                                          CROWN BAR

Located At  103 HOWARD AVENUE   BILOXI, HARRISON
           -------------------------------------------------------------------

     This permit signifies compliance on the date of issue with the Food 
Service Sanitation Regulation of the Mississippi State Department of Health 
and is valid for a period of 12 months from the date of issue unless 
suspended or revoked.

         /S/                                        March 16, 1994
------------------------------                  ------------------------------
Issuing Official                                                          Date

         /S/                                        24F-C0893
------------------------------                  ------------------------------
State Health Officer                                                    Permit


Revised 12/92         Display For Public View-Non Transferable    Form No. 307





<PAGE>

                                  MISSISSIPPI
                             STATE DEPARTMENT OF
                                   HEALTH

                               Hereby Grants A

                             Food Service Permit
                                     To

                             MARITIME GROUP LTD

            To Maintain and Operate A Food Service Establishment


Under The Name Of                       PALACE CASINO
                 -------------------------------------------------------------
                                       GOLDEN WELL BAR

Located At  103 HOWARD AVENUE   BILOXI, HARRISON
           -------------------------------------------------------------------

     This permit signifies compliance on the date of issue with the Food 
Service Sanitation Regulation of the Mississippi State Department of Health 
and is valid for a period of 12 months from the date of issue unless 
suspended or revoked.

         /S/                                        March 16, 1994
------------------------------                  ------------------------------
Issuing Official                                                          Date

         /S/                                        24F-C0892
------------------------------                  ------------------------------
State Health Officer                                                    Permit


Revised 12/92         Display For Public View-Non Transferable    Form No. 307





<PAGE>

                                  MISSISSIPPI
                             STATE DEPARTMENT OF
                                   HEALTH

                               Hereby Grants A

                             Food Service Permit
                                     To

                             MARITIME GROUP LTD

            To Maintain and Operate A Food Service Establishment


Under The Name Of                       PALACE CASINO
                 -------------------------------------------------------------
                                         CROWN ROOM

Located At  103 HOWARD AVENUE   BILOXI, HARRISON
           -------------------------------------------------------------------

     This permit signifies compliance on the date of issue with the Food 
Service Sanitation Regulation of the Mississippi State Department of Health 
and is valid for a period of 12 months from the date of issue unless 
suspended or revoked.

         /S/                                        March 16, 1994
------------------------------                  ------------------------------
Issuing Official                                                          Date

         /S/                                        24F-A0442
------------------------------                  ------------------------------
State Health Officer                                                    Permit


Revised 12/92         Display For Public View-Non Transferable    Form No. 307


<PAGE>

                           ALCOHOLIC BEVERAGE PERMIT

Permit No.     7319 24 122
Date Issued    April 6, 1994
Date Expired   April 5, 1995
Issue          New

Class          ON PREMISES RETAILER

Issued To:

Maritime Group, Ltd.
Palace Casino
158 Howard Avenue
Biloxi, MS 39530    Harrison

Issued By:

             /S/
--------------------------------
Director

             /S/
--------------------------------
Commissioner

NO: 2638

<PAGE>

                                HARRISON COUNTY
                          WASTEWATER AND SOLID WASTE
                              MANAGEMENT DISTRICT
                              14108 AIRPORT ROAD
                                 P.. BOX 2409
                          GULFPORT, MISSISSIPPI 39505


                      PERMIT APPLICATION AND REGISTRATION

                            GREASE WASTE GENERATOR


Date   3-28-94
Applicant's Business Name             Maritime Resorts d/b/a Palace Casino
Mailing Address                       182 Howard Ave, Biloxi, Mississippi 39530
Physical Address of food
  preparation establishment           182 Howard Ave, Biloxi, Mississippi 39530
Number of grease traps                1
Approximate size in Gallons of each   253.2 Compactor #1 Interceptor


This is to certify that the information given above is correct to the best of 
my knowledge and belief. By my signature I hereby agree to the conditions 
stated n the Harrison County Wastewater and Solid Waste Management District 
Grease Trap Waste Regulation, Dated April 2, 1992.

Signature
Printed Name   Leonard Pizzetta
Title          Chief Engineer

Information verified by   /S/
Permit Number             T-081
Entered Date              4-6-94
Expiration Date           7-1-94
Fee paid                  30.00
Check #                   0632
Received by               /S/
Approval Signature        /S/


<PAGE>

                                HARRISON COUNTY
                          WASTEWATER AND SOLID WASTE
                              MANAGEMENT DISTRICT
                              14108 AIRPORT ROAD
                                 P.. BOX 2409
                          GULFPORT, MISSISSIPPI 39505


                      PERMIT APPLICATION AND REGISTRATION

                            GREASE WASTE GENERATOR


Date   3-28-94
Applicant's Business Name             Maritime Resorts d/b/a Palace Casino
Mailing Address                       182 Howard Ave, Biloxi, Mississippi 39530
Physical Address of food
  preparation establishment           182 Howard Ave, Biloxi, Mississippi 39530
Number of grease traps                1
Approximate size in Gallons of each   525.2 Main #8 Interceptor


This is to certify that the information given above is correct to the best of 
my knowledge and belief. By my signature I hereby agree to the conditions 
stated n the Harrison County Wastewater and Solid Waste Management District 
Grease Trap Waste Regulation, Dated April 2, 1992.

Signature      /S/ LEONARD PIZZETTA
Printed Name   Leonard Pizzetta
Title          Chief Engineer

Information verified by   /S/
Permit Number             T-088
Entered Date              4-6-94
Expiration Date           7-1-94
Fee paid                  30.00
Check #                   06371
Received by               /S/
Approval Signature        /S/



<PAGE>

                                HARRISON COUNTY
                          WASTEWATER AND SOLID WASTE
                              MANAGEMENT DISTRICT
                              14108 AIRPORT ROAD
                                 P.. BOX 2409
                          GULFPORT, MISSISSIPPI 39505


                      PERMIT APPLICATION AND REGISTRATION

                            GREASE WASTE GENERATOR


Date   3-28-94
Applicant's Business Name             Maritime Resorts d/b/a Palace Casino
Mailing Address                       182 Howard Ave, Biloxi, Mississippi 39530
Physical Address of food
  preparation establishment           182 Howard Ave, Biloxi, Mississippi 39530
Number of grease traps                1
Approximate size in Gallons of each   17.3 Sink #5 Interceptor


This is to certify that the information given above is correct to the best of 
my knowledge and belief. By my signature I hereby agree to the conditions 
stated n the Harrison County Wastewater and Solid Waste Management District 
Grease Trap Waste Regulation, Dated April 2, 1992.

Signature      /S/ LEONARD PIZZETTA
Printed Name   Leonard Pizzetta
Title          Chief Engineer

Information verified by   /S/
Permit Number             T-085
Entered Date              4-6-94
Expiration Date           7-1-94
Fee paid                  30.00
Check #                   06371
Received by               /S/
Approval Signature        /S/
<PAGE>

                                HARRISON COUNTY
                          WASTEWATER AND SOLID WASTE
                              MANAGEMENT DISTRICT
                              14108 AIRPORT ROAD
                                 P.. BOX 2409
                          GULFPORT, MISSISSIPPI 39505


                      PERMIT APPLICATION AND REGISTRATION

                            GREASE WASTE GENERATOR


Date   3-28-94
Applicant's Business Name             Maritime Resorts d/b/a Palace Casino
Mailing Address                       182 Howard Ave, Biloxi, Mississippi 39530
Physical Address of food
  preparation establishment           182 Howard Ave, Biloxi, Mississippi 39530
Number of grease traps                1
Approximate size in Gallons of each   17.3 Sink #6 Interceptor

This is to certify that the information given above is correct to the best of 
my knowledge and belief. By my signature I hereby agree to the conditions 
stated n the Harrison County Wastewater and Solid Waste Management District 
Grease Trap Waste Regulation, Dated April 2, 1992.

Signature      /S/ LEONARD PIZZETTA
Printed Name   Leonard Pizzetta
Title          Chief Engineer

Information verified by   /S/
Permit Number             T-086
Entered Date              4-6-94
Expiration Date           7-1-94
Fee paid                  30.00
Check #                   06371
Received by               /S/
Approval Signature        /S/


<PAGE>

                                HARRISON COUNTY
                          WASTEWATER AND SOLID WASTE
                              MANAGEMENT DISTRICT
                              14108 AIRPORT ROAD
                                 P.. BOX 2409
                          GULFPORT, MISSISSIPPI 39505


                      PERMIT APPLICATION AND REGISTRATION

                            GREASE WASTE GENERATOR


Date   3-28-94
Applicant's Business Name             Maritime Resorts d/b/a Palace Casino
Mailing Address                       182 Howard Ave, Biloxi, Mississippi 39530
Physical Address of food
  preparation establishment           182 Howard Ave, Biloxi, Mississippi 39530
Number of grease traps                1
Approximate size in Gallons of each   168 Diswasher #4 Interceptor


This is to certify that the information given above is correct to the best of 
my knowledge and belief. By my signature I hereby agree to the conditions 
stated n the Harrison County Wastewater and Solid Waste Management District 
Grease Trap Waste Regulation, Dated April 2, 1992.


Signature      /S/ LEONARD PIZZETTA
Printed Name   Leonard Pizzetta
Title          Chief Engineer

Information verified by   /S/
Permit Number             T-084
Entered Date              4-6-94
Expiration Date           7-1-94
Fee paid                  30.00
Check #                   06371
Received by               /S/
Approval Signature        /S/



<PAGE>

                                HARRISON COUNTY
                          WASTEWATER AND SOLID WASTE
                              MANAGEMENT DISTRICT
                              14108 AIRPORT ROAD
                                 P.. BOX 2409
                          GULFPORT, MISSISSIPPI 39505


                      PERMIT APPLICATION AND REGISTRATION

                            GREASE WASTE GENERATOR


Date   3-28-94
Applicant's Business Name             Maritime Resorts d/b/a Palace Casino
Mailing Address                       182 Howard Ave, Biloxi, Mississippi 39530
Physical Address of food
  preparation establishment           182 Howard Ave, Biloxi, Mississippi 39530
Number of grease traps                1
Approximate size in Gallons of each   168 Dishwasher #2 Interceptor


This is to certify that the information given above is correct to the best of 
my knowledge and belief. By my signature I hereby agree to the conditions 
stated n the Harrison County Wastewater and Solid Waste Management District 
Grease Trap Waste Regulation, Dated April 2, 1992.


Signature      /S/ LEONARD PIZZETTA
Printed Name   Leonard Pizzetta
Title          Chief Engineer

Information verified by   /S/
Permit Number             T-082
Entered Date              4-6-94
Expiration Date           7-1-94
Fee paid                  30.00
Check #                   06371
Received by               /S/
Approval Signature        /S/



<PAGE>

                                HARRISON COUNTY
                          WASTEWATER AND SOLID WASTE
                              MANAGEMENT DISTRICT
                              14108 AIRPORT ROAD
                                 P.. BOX 2409
                          GULFPORT, MISSISSIPPI 39505


                      PERMIT APPLICATION AND REGISTRATION

                            GREASE WASTE GENERATOR


Date   3-28-94
Applicant's Business Name             Maritime Resorts d/b/a Palace Casino
Mailing Address                       182 Howard Ave, Biloxi, Mississippi 39530
Physical Address of food
  preparation establishment           182 Howard Ave, Biloxi, Mississippi 39530
Number of grease traps                1
Approximate size in Gallons of each   168 Dishwasher #3 Interceptor


This is to certify that the information given above is correct to the best of 
my knowledge and belief. By my signature I hereby agree to the conditions 
stated n the Harrison County Wastewater and Solid Waste Management District 
Grease Trap Waste Regulation, Dated April 2, 1992.


Signature      /S/ LEONARD PIZZETTA
Printed Name   Leonard Pizzetta
Title          Chief Engineer

Information verified by   /S/
Permit Number             T-083
Entered Date              4-6-94
Expiration Date           7-1-94
Fee paid                  30.00
Check #                   06371
Received by               /S/
Approval Signature        /S/



<PAGE>

                                HARRISON COUNTY
                          WASTEWATER AND SOLID WASTE
                              MANAGEMENT DISTRICT
                              14108 AIRPORT ROAD
                                 P.. BOX 2409
                          GULFPORT, MISSISSIPPI 39505


                      PERMIT APPLICATION AND REGISTRATION

                            GREASE WASTE GENERATOR


Date   3-28-94
Applicant's Business Name             Maritime Resorts d/b/a Palace Casino
Mailing Address                       182 Howard Ave, Biloxi, Mississippi 39530
Physical Address of food
  preparation establishment           182 Howard Ave, Biloxi, Mississippi 39530
Number of grease traps                1
Approximate size in Gallons of each   17.3 Sink #7 Interceptor


This is to certify that the information given above is correct to the best of 
my knowledge and belief. By my signature I hereby agree to the conditions 
stated n the Harrison County Wastewater and Solid Waste Management District 
Grease Trap Waste Regulation, Dated April 2, 1992.


Signature      /S/ LEONARD PIZZETTA
Printed Name   Leonard Pizzetta
Title          Chief Engineer

Information verified by   /S/
Permit Number             T-087
Entered Date              4-6-94
Expiration Date           7-1-94
Fee paid                  30.00
Check #                   06371
Received by               /S/
Approval Signature        /S/


<PAGE>

                             STATE OF MISSISSIPPI
                         MISSISSIPPI GAMING COMMISSION

                                                              License No.  056

                                GAMING LICENSE

This Gaming License entitles MARITIME GROUP, LTD., d/b/a PALACE CASINO, 
located at Howard Avenue, Biloxi, Mississippi, (Harrison Co.)  to engage as 
an OPERATOR.  This license is subject to the Mississippi Gaming Control Act 
and the Rules and Regulations adopted thereunder.  This authorizes the holder 
of the license to conduct gaming pursuant to the type of license issued by 
the Mississippi Gaming Commission.  The License is non-transferable or 
assignable and must be conspicuously displayed in an area visible to the 
public.

/S/ STUART C. IRBY, JR.                          /S/
-----------------------------              -----------------------------------
Chairman, Stuart C. Irby, Jr.              Executive Director
                                           Mississippi Gaming Commission

Date Issued:   March 17, 1994              Expiration Date:  March 17, 1996



<PAGE>

                            STATE OF MISSISSIPPI
                      BEER PERMIT AND PRIVILEGE LICENSE

STATE TAX COMMISSION                                       NUMBER
JACKSON, MISSISSIPPI


Retailer License Fee: $30.00
                      $30.00
Issued:               01/06/94
Business
Location:             124 Lameuse Street
Issued To:            Maritime Group Ltd
                      124 Lameuse Street
                      Biloxi, MS 39530
Effective Date:       09/01/94
Expiration Date:      09/01/95


<PAGE>


             CITY OF BILOXI, MISSISSIPPI - PRIVILEGE TAX LICENSE


<TABLE>

<S>                         <C>                            <C>                         <C>
A-15734                     A-17171                        A-17354                      
September 13, 1994          September 13, 1994             September 13, 1994           September 13, 1994
Expires: Unreadable         Expires: Sept. 30. 1994        Expires: Sept. 30, 1994      Expires:  Sept.  30, 1994
Received Of:                Received Of:                   Received Of:                 Received Of:
Palace Casino               Maritime Group, Ltd.           Palace Casino                Palace Casino/Crown Room
Maritime Group, Ltd.        Jack C??                       Maritime Group, Ltd.         Maritime Group, Ltd.
124 Lameuse St              124 Lameuse St                 124 Lameuse St               124 Lameuse St
Biloxi, MN 39530            Biloxi, MN 39530               Biloxi, MN 39530             Biloxi, MN 39530
Business Office             Business Office/Investments    Business Office/Dockside     Restaurants 9696 159
Total Tax $150.00           Total Tax $20.00               Saving (unreadable?)         Total Tax $105.00
Deputy Tax Collector /S/    Deputy Tax Collector /S/       Total Tax $30.00             Deputy Tax Collector /S/
                                                           Deputy Tax Collector /S/
</TABLE>


<TABLE>

<S>                         <C>
September, unreadable       September, unreadable
Expires: Sept. 30, ???      Expires: Sept. 30,
Received Of:                Received Of:
Palace/Emerald Courtyard    Palace/Pearl Diver Oyster
Maritime Group, Ltd.        Oar/Maritime Group, Ltd.
124 Lameuse St              124 Lameuse St
Biloxi, MN 39530            Biloxi, MN 39530
Restaurants 9696 159        Beer Retail      15.00
Total Tax $150.00           Restaurants 9696 159
Deputy Tax Collector /S/                     42.00
                            Total Tax $57.00
                            Deputy Tax Collector /S/
</TABLE>

<PAGE>

                                SCHEDULE 3.3(a)

Buyer is aware of the following items that may jeopardize the integrity of 
the Palace Casino's assets and by signature hereby waive those conditions so 
as to eliminate them from consideration relative to Section 3.3(a):

     1.   Dredging under the barge should be completed to eliminate bottom
          touching and the possibility of damage to the hull and interior
          components.

     2.   New hatch covers should be redesigned and installed to further
          insure water-tight integrity of the hull compartments.

     3.   Internal areas of the barge should be further protected with a
          rust inhibitor paint which meets Maritime specifications.

     4.   Interior barge areas should be ventilated to insure removal of
          hazardous gases and reduce condensation.

     5.   Air cooled chillers #1 and #2 should be elevated above the roof
          line to insure proper ventilation and eliminating the use of water
          as a source of condenser cooling.

     6.   Additional Pre-heating coils need to be installed in the
          Dehumidfiers to further reduce the amount of humidity contained in
          the casino guest areas.

     7.   Environmental control system (Johnson Controls) should be
          checked out thoroughly and necessary components replaced as needed.

     8.   Roofing areas that necessitate repair should be performed to
          (Firestone) requirements and work pads need to be installed in
          appropriate walk paths to further reduce deterioration.

     9.   Dome area should be re-sealed and waterproofed to further prevent
          water intrusion into guest areas (Emerald Courtyard and Crown
          Room).

     10.  Exterior glass should be re-sealed and waterproofed to further
          prevent water intrusion into the exterior wall areas (Palladium
          Theater, Executive Offices, Slot Tech Room).

     11.  Dishwashing area should be reconfigured to meet Health
          Department standards on change of ownership.

     12.  Fire suppression systems in the main kitchen and Pearl Divers areas
          should be modernized to meet new fire code standards on change
          of ownership.


<PAGE>

     13.  Interior neon repair on first and second floors.

     14.  Exterior neon signage needs to be repaired to eliminate burned
          out sections including letters illuminating Palace Casino.


<PAGE>

                                 SCHEDULE 3.5

               Allocation of a Portion of the Purchase Price as
               ------------------------------------------------
                      to Certain Parcels of Real Property
                      -----------------------------------

Triplett Property:                                $    75,000
Off-Site 4.5 Acre Improved Parking Lot            $   300,000
Casino and related personal property              $13,875,000
 excluding Financed Property

Legal Description of Triplett Property:

THAT CERTAIN PARCEL OF LAND located in the City of Biloxi, Harrison County, 
Mississippi, being 74 feet North and South 65 feet East and West, and being 
bounded on the South by property now or formerly of Ewing; on the East by 
property of Cruso; on the North by property of Toche; and on the West by 
Seymour Lane; being part of Lot 4, Block 14, SUMMERVILLE ADDITION to the City 
of Biloxi, according to the official map or plat thereof on file and of 
record in Copy Plat Book 1, at page 11, in the office of the Chancery Clerk 
of Harrison County, Mississippi; said Lot is also described as Parcel No. 24, 
Block 14, Page 236 of the official Tax Records of Biloxi, Mississippi.

<PAGE>






                                 SCHEDULE 5.2




<PAGE>
                                 SCHEDULE 5.2

                            PERMITTED ENCUMBRANCES


1. Loftin property        Mortgage in favor of Peoples Bank, $123,000 principal
                          balance, five year term, 6% annum.


<PAGE>


                                 SCHEDULE 5.6

                    Employment Contracts and Benefit Plans
                    --------------------------------------

Employment Contracts:
---------------------

Between Maritime Group, Ltd.  And Palace Casinos, Inc. and Dual Cooper dated 
August 5, 1996.

Vacation Benefits:
------------------

Employees are entitled to vacation benefits under Maritime Group, Ltd.'s 
vacation policy on the following schedule:

     One year of service         -       five days paid vacation
     Two years of service        -       ten days paid vacation
     Three years of service      -       ten days paid vacation
     Four years of service       -       fifteen days paid vacation

As of September 1996, Maritime Group, Ltd.  Has $44,599 in accrued vacation 
pay.

Medical Insurance Benefits:
---------------------------

(through September 30, 1996)
Blue Cross & Blue Shield covering employees

(from October 1, 1996 on)
Self insured through Pomeroy & Pomeroy

<PAGE>

                      [Table of Miscellaneous Inventory]
<PAGE>







                               SCHEDULE 2.1(f)







<PAGE>


                               EXHIBIT 2(1)(h)

TELEPHONE NUMBERS USED:       (601) 432-8888
                              (601) 436-4200


<PAGE>






                                SCHEDULE 2.2(a)





<PAGE>

                              MARITIME GROUP LTD.
                               SUMMARY OF LEASES

-------------------------------------------------------------------------------
Thomas, Tyron & Gary Gollott     Land Lease - Visitor Center        $7,000.00
P.O. Box 468
Biloxi, MS 39533
-------------------------------------------------------------------------------
Fleuer De Lis Society            Building Lease - Support Services  $4,000.00
c/o Peoples Bank-Chevi Swetman
P.O. Box Drawer 529
Biloxi, MS 395533
-------------------------------------------------------------------------------
Gulf Central Seafoods, Inc.      Land Lease - Parking Lot           $28,500.00
P.O. Box 373
Biloxi, MS 39533
-------------------------------------------------------------------------------
Sea Products, Inc.               Land Lease - Parking Lot           $30,000.00
P.O. Box 1419
Biloxi, MS 39533
-------------------------------------------------------------------------------
Private Mini Storage             Storage                            289.00
3755 Airport Blvd.
Mobile, AL 36608
-------------------------------------------------------------------------------
Hancock Bank                     Copier Lease                       $370.00
P.O. Box 4019
Gulfport, MS 39502
-------------------------------------------------------------------------------
Taylor Properties                Warehouse                          $2,000.00
P.O. Box 1206
Biloxi, MS 39533
-------------------------------------------------------------------------------
Ford Motor Credit                Automotive Lease (2)               $1.147.72
P.O. Box 830339
Birmingham, AL 35283
-------------------------------------------------------------------------------
Pitney Bowes Credit Corporation  Postage Machine                    $156.00 (1)
P.O. Box 5151
Norwalk, CT 06856-5151
-------------------------------------------------------------------------------
Pitney Bowes Credit Corporation   Postage Machine                   $127.50 (1)
8375 Dix Ellis Trail - Ste 301
Jacksonville, FL 32256-1221
-------------------------------------------------------------------------------
                                                                    $80,042.22
-------------------------------------------------------------------------------
                                  (1) PAYMENTS ARE MADE
                                  QUARTERLY
-------------------------------------------------------------------------------


<PAGE>






                               SCHEDULE 2.2 (b)





<PAGE>

                              SOFTWARE INVENTORY

-------------------------------------------------------------------------------
NAME                                      USERS                 ??
-------------------------------------------------------------------------------
DOS                                       55                    8.2
-------------------------------------------------------------------------------
MSOFFICE                                  NETWORK               4.01
-------------------------------------------------------------------------------
MSWORD                                                          8
-------------------------------------------------------------------------------
EXCELL                                                          5
-------------------------------------------------------------------------------
MSPUB                                     2                     2
-------------------------------------------------------------------------------
MSWORKS                                   55
-------------------------------------------------------------------------------
HARVARD GRAPHICS                          1                     4
-------------------------------------------------------------------------------
NOVELL 3.12                               50                    3.12
-------------------------------------------------------------------------------
DAVINCHI MAIL                             60
-------------------------------------------------------------------------------
ACCESS                                                          1.1
-------------------------------------------------------------------------------
FOXPRO                                                          2.8
-------------------------------------------------------------------------------
DOS IBM                                   15                    8
-------------------------------------------------------------------------------
IGT                                       NETWORK
-------------------------------------------------------------------------------
LODGINGS                                  NETWORK
-------------------------------------------------------------------------------
MSPWRPOINT                                55
-------------------------------------------------------------------------------
MSMONEY                                   2
-------------------------------------------------------------------------------
LANTASTIC                                 15
-------------------------------------------------------------------------------
INFOGENESIS                               1
-------------------------------------------------------------------------------
ELITE400                                  30
-------------------------------------------------------------------------------
BACKUPEXEC                                1                     4.01
-------------------------------------------------------------------------------
OMNIPAGE                                  1
-------------------------------------------------------------------------------
COMMWORKS                                 1
-------------------------------------------------------------------------------
PCTOOLS                                   1
-------------------------------------------------------------------------------
FORMTOOL                                  11.0B
-------------------------------------------------------------------------------
SMARTLABE                                 2                     3
-------------------------------------------------------------------------------
PROBAR                                    1
-------------------------------------------------------------------------------
SHIVA                                     23.7.7
-------------------------------------------------------------------------------
SMARTCOM                                  1                     1
-------------------------------------------------------------------------------
ADP PC/PAYROLL                            2                     5.02
-------------------------------------------------------------------------------
PASSBOOK TICKETING SYSTEMS                1                     1
-------------------------------------------------------------------------------


<PAGE>







                               EXHIBIT 2(2) (c)





<PAGE>

                              MARITIME GROUP LTD.
                            FINANCING ARRANGEMENTS


Name & Address                                   Description
--------------                                   -------------

Bally Gaming Inc.
6601 South Bermuda Road
Las Vegas, Nevada 89110-3605                     Slot Machines

International Gaming Technology
P.O. Box 10580
Reno, Nevada 89510-0580                          Slot Machines

Mikhon Gaming Corporation
1045 Palms Airport Drive
Las Vegas, Nevada 89119                          Neon Signs

NEC America, Inc.
365 West Passaic Street
Rochelle Park, NJ 07662                          Phone Equipment

IBM Credit Corporation
290 Harbor Drive
Stamford, CT 06904                               Point of Sale System

Peoples Bank
P.O. Box Drawer 529
Biloxi, MS 39530                                 Mortgage on Property Adjacent
                                                 to the Casino

Ford Motor Credit Company
P.O. Box 830339
Birmingham, AL 35283-0339                        Van

                                                 Total Payments

(1) Estimate based upon pro rata number of machines remaining
(2) Includes payment of those machines removed from the floor (approx. 50)
(3) Includes a $1 purchase option at the end of the Agreement



                                Schedule 2.3(h)
                         Excluded Insurance Policies
                         ---------------------------


Insurance                          Type of                  Policy
Company                            Coverage                 Numbers
---------                          --------                 --------
Scottsdale Ins.  Co.               General Liability        CGS 012801
                                                            CAS 040831
                                                            CLS 0367962
Miss.  Windstorm
Underwriters Ass'n                  Wind                    CPF 757004

USF&G                               Property                CPR 300254460-01

Hartford Steam Boiler &
Inspection Co.                      EDP                     CSI 944368301

Fidelity & Deposit Ins.  Co.        Crime                   CCP 0007812-01

Westchester Fire Ins.  Co.          Umbrella                CUA 102877-0

Lloyds/St. Paul                     Hull/Equipment          Binder No. AGJ 1010
(includes the following:)
Reliance Ins.  Co.                  Equipment
William H. McGee & Co.              Equipment
Navigators Ins.  Co.                Equipment
John Plumer & Parnter Ltd.          Hull and P&I
St. Paul Fire & Marine Ins. Co.     Hull and P&I