<PAGE>

                     SECURED PROMISSORY NOTE
                                
$2,351,705.00 (U.S)                             Las Vegas, Nevada
                                                 December 3, 1998


          For  value  received,  Casinovations  Incorporated,   a
Washington corporation (together with its successors and assigns,
"Borrower"), promises to pay to the order of Steven L. Forte  and
Cheryl  Forte  (together with their successors  and  assigns  who
become  holders of this Note, "Lender"), the principal amount  of
Two  Million Three Hundred Fifty One Thousand Seven Hundred  Five
and no/100ths Dollars ($2,351,705.00 U.S.).

     1.   INTEREST.

          Borrower  also promises to pay to the order  of  Lender
interest  on the outstanding principal amount of this  Promissory
Note  ("Note") at a fixed rate of interest equal to six and  one-
half percent (6 1/2%) percent per annum during the first year this
Note  remains  outstanding,  and eight  percent  (8%)  per  annum
thereafter.   Interest  hereunder shall  be  calculated  for  the
actual  number  of days elapsed on the basis of a  360-day  year.
This Note shall be amortized over a ten (10) year period from the
date hereof.

     2.   SCHEDULED PAYMENTS.

          Throughout the first year this Note is outstanding, and
without  prior demand therefor, Borrower shall make  payments  of
interest  only, payable on the six month and one year anniversary
dates  of this Note, in the amounts of $76,430.41 and $76,430.41,
respectively.   Thereafter, Borrower shall make monthly  payments
without  prior demand therefor of principal and interest  on  the
amount  outstanding hereunder, on the first  day  of  each  month
beginning  on  January 1, 2000, in the amount of  $28,532.67  for
each  such  payment and continuing thereafter until  December  3,
2003  ("Maturity Date"), at which time all unpaid  principal  and
all  accrued and unpaid interest under this Note shall be due and
payable in full.

     3.   SECURITY.

          This  Note  is  secured by (i) 848,682  shares  of  the
common stock ("Common Stock") of Borrower, in accordance with the
terms  of  a certain Stock Pledge Agreement dated as of the  date
hereof  between  Borrower and Lender and (ii)  a  first  priority
security  interest  in  Borrower's patents  ("Patents")  for  the
Random Ejection Shuffler and Fantasy 21 table game, in accordance
with  the terms of a certain Security Agreement dated as  of  the
date hereof between Borrower and Lender ("Security Agreement").

     4.   EARLY PAYMENT DISCOUNT.

          In  the  event this Note is repaid in full  within  180
days  of  the date hereof, Borrower shall be entitled to  a  five
percent (5%) discount (the "Discount") on the outstanding balance
of  principal  and interest hereunder at the time  of  repayment;
PROVIDED, HOWEVER, that the entitlement to the Discount  is  non-
transferable and is available to Borrower only to the extent that
a  Change of Control (as hereinafter defined) has not occurred at
any  time during such 180 day period.  For purposes of this Note,
"Change  of  Control" means the acquisition of  more  than  fifty
percent  (50%) of the voting power of Borrower by a person  other
than Richard S. Huson or his affiliates.

                                1
                                
<PAGE>

     5.   MANDATORY PRINCIPAL REDUCTIONS.

          In  the  event that Borrower completes its offering  of
1,500,000 shares of Common Stock (the "Offering") pending  as  of
the  date  hereof pursuant to that certain Registration Statement
Form  SB-2/A  (Commission  File No. 333-31373),  Borrower  shall,
pursuant  to the payment schedule set forth in the following  two
paragraphs, make payments to reduce the outstanding principal  of
this  Note  by  no  more than the amount of Seven  Hundred  Fifty
Thousand and no/100ths Dollars ($750,000.00 U.S.).

          (a)    Borrower  shall  make  payments  to  reduce  the
outstanding principal of this Note as follows:  (i) upon the sale
of  500,000  shares  of Common Stock for cash  in  the  Offering,
Borrower shall reduce the outstanding principal of this  Note  in
the  amount  of Two Hundred Fifty Thousand and no/100ths  Dollars
($250,000.00  U.S.) within fifteen (15) calendar days  after  the
receipt by Borrower of the proceeds from such sale; and (ii) upon
completion of the Offering and if Borrower sells 1,500,000 shares
of  Common  Stock  in  the  Offering,  Borrower  shall  repay  an
additional   Five   Hundred  Thousand   and   no/100ths   Dollars
($500,000.00 U.S.) within forty-five (45) calendar days after the
close of the Offering.

          (b)   In the event that Borrower fails to complete  the
entire  Offering,  but sells at least 500,000  shares  of  Common
Stock  for cash in the Offering, Borrower shall make payments  to
reduce  the  outstanding principal of this  Note  (the  "Modified
Principal Reduction") as follows:

<TABLE>
<CAPTION>

<S>                   <C>             <C>
Modified Principal =  $750,000.00 x   NUMBER OF SHARES OF COMMON STOCK SOLD FOR CASH
                                      -----------------------------------------------
    Reduction                                 1,500,000 Shares of Common Stock

</TABLE>

          The  Modified  Principal Reduction  shall  be  paid  as
follows: (i) an initial principal reduction of up to Two  Hundred
Fifty Thousand and no/100ths Dollars ($250,000.00 U.S.) shall  be
paid  within  fifteen  (15) calendar days after  the  receipt  by
Borrower  of  the  proceeds from the sale of  500,000  shares  of
Common  Stock for cash (if and only if such sum has  not  already
been  paid pursuant to subparagraph 5(a)(i) hereof) and (ii)  the
balance  of  the Modified Principal Reduction, if any,  shall  be
repaid on or before forty-five (45) calendar days after the close
of the Offering.

     6.   SUBSEQUENT OFFERING PRINCIPAL REDUCTION.

          In  the event that Borrower issues and sells shares  of
Common  Stock in a registered public offering subsequent  to  the
Offering   (a   "Subsequent  Offering"),  Borrower   shall   make
additional  principal  reductions of this Note  pursuant  to  the
following   three  alternative  principal  reduction   schedules.
FIRST,  if  Borrower receives net cash proceeds, excluding  those
proceeds  received  by selling stockholders,  from  a  Subsequent
Offering less than or equal to $3,000,000, Borrower shall  reduce
the  then outstanding principal of this Note by 25%.  SECOND,  if
Borrower  receives  net cash proceeds, excluding  those  proceeds
received  by selling stockholders, from a Subsequent Offering  of
greater  than  $3,000,000 and less than or equal to  $10,000,000,
Borrower shall reduce the then outstanding principal of this Note
by 50%.  THIRD, if Borrower receives net cash proceeds, excluding
those   proceeds  received  by  selling  stockholders,   from   a
Subsequent  Offering of greater than $10,000,000, Borrower  shall
reduce  the  then  outstanding principal of this  Note  by  100%;
PROVIDED, HOWEVER, that the obligation of Borrower to reduce  the
outstanding principal of this Note upon the sale of shares  in  a
Subsequent  Offering  does not arise in the event  that  Borrower
registers shares of Common Stock with the Securities and Exchange
Commission on a (i) Registration Statement on Form S-8  or  other
applicable

                                2
                                
<PAGE>

form with respect to employee benefit plans, or (ii) Registration
Statement  on  Form S-4 or other applicable form  in  conjunction
with a reincorporation or reorganization of Borrower.

     7.   MANDATORY SECURITY RELEASE.

          Notwithstanding  any  other  provision  hereof,  Lender
shall  release its security interest in the Patents in accordance
with  Section 7 of the Security Agreement upon:  (a) the  request
of  the  Company  for release of the security  interest  for  the
purposes  of  future financing, either debt or  equity,  for  the
Company,  and  (b) the reduction of fifty percent  (50%)  of  the
outstanding  principal  of the Note by  the  Company.   Upon  the
occurrence  of  (a)  and  (b) of this Section  7,  the  following
actions  shall occur in the order as follows:  (y)  Lender  shall
release  its security interest in the Patents in accordance  with
Section  7 of the Security Agreement; and (z) the Note  shall  be
amended  to  reflect  the release of the aforementioned  security
interest  and  to  include a due-on-sale  provision  whereby  the
remaining balance of the Note will be due and owing upon a Change
of Control.

     8.   DEFAULT.

          The occurrence of any of the following shall constitute
a  default  ("Default") under this Note, the Security  Agreement,
Stock  Pledge Agreement and that certain binding letter of intent
dated May 28, 1998 (the "Transaction Documents"):

          (a)   Failure of Borrower to make any payment under the
Transaction  Documents and the failure of Borrower, after  notice
of  such  failure, to cure such failure within ten (10)  calendar
days of such notice;

          (b)  Failure of Borrower to perform any other covenant,
agreement  or  other  obligations contained  in  the  Transaction
Documents  and  the  failure of Borrower, after  notice  of  such
failure,  to cure such failure to either:  (i) cure such  failure
within fifteen (15) calendar days (or within thirty (30) calendar
days  if  Borrower is not reasonably able to cure, to be extended
at  the  sole discretion of Lender); or (ii) (A) submit a written
plan  to Lender within fifteen (15) calendar days of such  notice
to  cure such failure, and (B) pursue such written plan with  due
diligence,  but  in  no event more than thirty  (30)  days  after
notice of such default is given;

          (c)   Falsity  of  any  warranty,  representation,   or
statement made or furnished to Lender by Borrower in any material
respect when made or furnished, unless Lender determines  in  its
sole discretion that the value of all or a substantial portion of
the Collateral, or Lender's security interest in such Collateral,
is not materially impaired;

          (d)   Voluntary filing of petition under the Bankruptcy
Code  of  1978,  as  amended, or any other similar  or  successor
federal  statute relating to bankruptcy, insolvency  arrangements
or   reorganizations,  or  any  state  bankruptcy  or  insolvency
statute;

          (e)   Filing  of  an  involuntary  petition  under  the
Bankruptcy  Code  of 1978, as amended, or any  other  similar  or
successor  federal  statute  relating to  bankruptcy,  insolvency
arrangements  or  reorganizations, or  any  state  bankruptcy  or
insolvency  statute, unless the same is discharged  within  sixty
(60) calendar days;

          (f)   Adjudication  of  bankruptcy  or  dissolution  of
Borrower;

          (g)   Appointment of a trustee or receiver for Borrower
or Borrower's assets;

                                3
                                
<PAGE>

          (h)   Seizure of any portion of Borrower's assets  that
is not discharged within ten (10) calendar days;

          (i)   Transfer or encumbrance of all or any portion  of
Borrower's interest in the Collateral without obtaining the prior
consent  of  Lender or as expressly permitted by the  Transaction
Documents.

          Upon  the  occurrence of a Default, Lender may  declare
any or all of Borrower's obligations immediately due and payable,
without notice to or demand upon Borrower.  In such event, Lender
shall  have  the  rights  and  remedies  to  the  fullest  extent
possible, all of which shall be cumulative and not exclusive,  of
a secured party under the Uniform Commercial Code of the State of
Nevada  and  any  applicable federal statute.   Where  additional
notice  or  cure  periods are required by law, said  periods  and
those  contained  in  this  Section  8  shall  run  concurrently.
Nothing  in  this Section 8 shall be construed as  extending  the
term of this Note or the date upon which a default occurs, and no
decision  to  forego any remedy for any given  default  shall  be
deemed  a  waiver on the part of Lender of any right relating  to
any  other  Default.  No failure to give notice  of  any  default
shall  constitute a waiver of such default for any  remedy  which
may  be available in connection therewith.  This Section 8  shall
be  strictly construed, and shall not impair the exercise of  any
remedy   not   referred  to  herein  immediately  upon   Default,
including,   without  limitation,  a  mandatory  or   prohibitive
injunction or restraining order or the appointment of a receiver.

     9.   GENERAL PROVISIONS.

          (a)   Both  principal and interest  shall  be  paid  by
Borrower  in  lawful money of the United States of  America  such
that  Lender shall have received immediately available funds  for
the  credit of Borrower by not later than 5:00 p.m. Pacific  time
on the date that such payment is due. Any payment made after 5:00
p.m.  Pacific time shall be deemed received on the next  Business
Day.  If  any  Payment becomes due on any  day  which  is  not  a
Business  Day, such Payment shall be made on the next  succeeding
Business Day. The term "Business Day" means those weekdays  which
are not local, state or national holidays.

          (b)  All payments hereunder shall be made to Lender  at
the  following  address: 315 Francisco Street, Henderson,  Nevada
89014, attn.:  Steven L. Forte (or such other place as Lender may
designate to Borrower in writing).  All payments hereunder  shall
be credited first to the interest then due and the balance of any
such  payment  (if  any)  shall be credited  to  the  outstanding
principal hereunder.

          (c)   Borrower  may prepay the entire unpaid  principal
balance  and  accrued interest under this Note  (or  any  portion
thereof) at any time without penalty.

          (d)   All  payments  hereunder shall  be  made  without
deduction  for  any  present or future  taxes,  levies,  imposts,
deductions,  charges or withholdings, and any such amounts  shall
be  paid  by Borrower.  Borrower shall pay the amounts  necessary
such  that  the  gross amount of principal and interest  payments
received  by Lender is not less than that required by this  Note.
All  stamp and documentary taxes shall be paid by Borrower.   If,
notwithstanding  the foregoing sentences, Lender  pays  any  such
taxes, Borrower shall reimburse Lender for the amount paid if, as
and  to  the extent such reimbursement is permitted by applicable
law.   Borrower shall furnish to Lender official tax receipts  or
other evidence of payment of all such taxes.

                                4
                                
<PAGE>

          (e)   If any attorney is engaged by Lender or if Lender
incurs any costs, expenses or losses because of any Default or to
enforce or defend any provision of this Note, then Borrower shall
pay,  upon demand, the reasonable attorneys' fees and all  costs,
expenses  and losses so incurred by Lender together with interest
thereon  until  paid as if such unpaid attorneys'  fees  and  all
costs, expenses and losses had been added to the principal  owing
hereunder.  Interest  on the amount of attorneys'  fees  and  all
costs,  expenses and losses so unpaid shall be compounded monthly
and shall be due and payable upon demand.

          (f)  No waiver of any Default shall be implied from any
failure of Lender to take or any delay by Lender in taking action
with  respect to any such Default or from any previous waiver  of
any  similar  or unrelated Default. A waiver of any  term  hereof
must  be  made  in writing and shall be limited  to  the  express
written terms of such waiver.

          (g)   Borrower  waives presentment, demand,  notice  of
dishonor,   notice   of   default  or  delinquency,   notice   of
acceleration, notice of protest and nonpayment, notice of  costs,
expenses  or  losses and interest thereon, notice of interest  on
interest  and late charges and diligence in taking any action  to
collect any sums owing under this Note.

          (h)   TIME  IS  OF  THE ESSENCE WITH RESPECT  TO  EVERY
PROVISION HEREOF.

          (i)   This  Note  shall be construed  and  enforced  in
accordance  with the laws of the State of Nevada, except  to  the
extent  that  Lender shall at any time have greater rights  under
Federal law; and all persons and entities in any manner obligated
under  this  Note consent to the jurisdiction of any  Federal  or
State  court  within the State of Nevada selected by  Lender  and
also  consent  to service of process by any means  authorized  by
Nevada or Federal law.

          (j)   This Note is hereby expressly limited so that  in
no  contingency  or event whatsoever, whether by acceleration  of
maturity  of  the debt evidenced hereby or otherwise,  shall  the
amount  paid  or  agreed  to  be paid  to  Lender  for  the  use,
forbearance or detention of the money advanced or to be  advanced
under  this Note exceed the highest lawful rate permissible under
the  laws  of the State of Nevada as applicable to Borrower.  If,
from  any  circumstances whatsoever, fulfillment of any provision
hereof  or  of  any other agreement, evidencing or  securing  the
debt,  at the time performance of such provisions shall  be  due,
shall  involve  the  payment  of  interest  in  excess  of   that
authorized  by  law,  the obligation to  be  fulfilled  shall  be
reduced  to  the  limit so authorized by law,  and  if  from  any
circumstances,  Lender shall ever receive as interest  an  amount
which  would  exceed the highest lawful rate  applicable  to  the
Borrower, such amount which would be excessive interest shall  be
applied to the reduction of the unpaid principal balance  of  the
debt evidenced hereby and not to the payment of interest.

                                   "BORROWER"

                                   CASINOVATIONS INCORPORATED, a
                                   Washington corporation
     
     
                                   By:/s/ Steven J. Blad
                                      ---------------------------
                                      Steven J. Blad
                                   Its: Chief Executive Officer

                                5