<PAGE>

                 RELEASE AND ASSIGNMENT AGREEMENT
                                 

     THIS  RELEASE  AND ASSIGNMENT AGREEMENT (this "Agreement")  is
made  and  entered  into as of the 15th day of  January  1999  (the
"Effective  Date"), by and between Steven L. Forte, an  individual,
and  Cheryl Forte, an individual (collectively, the "Fortes"),  and
Casinovations   Incorporated,   a   Washington   corporation   (the
"Company", collectively with the Fortes, the "Parties").

                             RECITALS
                                 
     WHEREAS, the Company executed a certain replacement promissory
note  in the principal amount of $135,047.46 dated August 31,  1998
in favor of Steven and Cheryl Forte (the "Replacement Note");

     WHEREAS,  the  Fortes  agreed to sell,  transfer,  assign  and
deliver  to  the  Company and the Company agreed  to  purchase  and
acquire  from  the Fortes all rights, titles and interests  of  the
Fortes  in  and  to the certain assets and rights  (contractual  or
otherwise)  of  the  Fortes, wherever  located,  as  follows:   (a)
848,682  shares  of the Company's common stock (the  "Shares")  for
$2.50  per share of common stock; (b) an option to purchase  20,000
shares  of  Company's  common stock (the "Option")  for  $1.50  per
underlying  share of common stock; and (c) the right to  receive  a
royalty on sales of the Random Ejection Shuffler, Fantasy 21  table
game and the Safety-Peek playing card (the "Royalty) (collectively,
the "Forte Transaction").

     WHEREAS,  the  Forte Transaction was evidenced by  a  purchase
agreement  (the  "Purchase Agreement"), a promissory  note  in  the
principal  amount of Two Million Three Hundred Fifty  One  Thousand
Seven Hundred Five and no/100ths Dollars ($2,351,705.00 U.S.)  (the
"Note"),  a  security agreement (the "Security Agreement"),  and  a
stock  pledge agreement (the "Pledge Agreement, collectively,  with
the  Replacement  Note, the Purchase Agreement, the  Note  and  the
Security Agreement, the Forte Documents").

     WHEREAS,  the  execution and delivery of the  Forte  Documents
were  contingent  upon  the approval by  the  Nevada  State  Gaming
Control Board (the "Board") of the Random Ejection Shuffler and the
terms  and  conditions of the Forte Transaction with such  approval
granted by the Board on December 3, 1998.

     WHEREAS,  the  Parties  executed  a  letter  agreement   dated
December  4,  1998  in  which the Parties agreed  to,  among  other
things,  cancel  the Forte Documents in exchange for  a  series  of
three payments by the Company to the Fortes of $500,000 on December
7,  1998, $500,000 on December 28, 1998 and $250,000 on January 15,
1998 (the "Payments").

     WHEREAS, the Company has provided the Fortes with the  payment
of  $500,000 on December 7, 1998, $500,000 on December 28, 1998 and
$250,000 on January 15, 1999.

     WHEREAS,  the Parties desire to enter into this Agreement  for
the  purposes  of  acknowledging the delivery of the  Payments  and
releasing  the Company from any of its obligations under the  Forte
Transaction,  the  Forte  Documents and any  other  matter  related
thereto.

      NOW,  THEREFORE, for and in consideration of the several  and
mutual    promises,    agreements,    covenants,    understandings,
undertakings, representations and warranties hereinafter set forth,
and  for  other  good and valuable consideration, the  receipt  and
sufficiency of which is hereby acknowledged, the Parties agree that
the   Recitals   are  true  and  correct  and  by  this   reference
incorporated herein as if fully set forth and further covenant  and
agree as follows:

                             ARTICLE I
                      RELEASE AND ASSIGNMENT
                                 
1.1  ASSIGNMENT OF RIGHTS, TITLES, BENEFITS AND INTERESTS

     In  acknowledging the delivery of the Payments by the  Company
to  the  Fortes, the Fortes hereby (a) deliver to the  Company  the
original   Forte  Documents;  (b)  absolutely  and  unconditionally
transfer, set over and

<PAGE>

assign  to the Company the Forte Documents such that such documents
shall  be  of  no  further  force and effect;  (c)  absolutely  and
unconditionally transfer, set over and assign to the Company all of
the   Fortes'  acquired  rights,  titles,  benefits  and  interests
currently  owned or hereinafter acquired, as a result of the  Forte
Transaction; and (d) forever relinquish to the Company any and  all
past,  present  and future interests, rights or claims,  direct  or
indirect,  in the Forte Documents, the Shares, the Option  and  the
Royalty.

1.2  RELEASE

     For valuable consideration, the sufficiency of which is hereby
acknowledged,  the  Fortes, each jointly  and/or  individually,  on
behalf  of  themselves,  their  respective  affiliates,  employees,
attorneys,  heirs,  executors  and administrators,  hereby  remise,
acquit   and  forever  release  the  Company,  and  its  respective
successors,   predecessors,   parents,  affiliates,   subsidiaries,
divisions, including, but not limited to their respective officers,
directors,    shareholders,    managers,    employees,    advisors,
consultants,  insurers, attorneys, heirs, executors, administrators
and  authorized  representatives from any and all claims,  demands,
damages, debts, liabilities, actions, causes of action or suits  of
whatsoever  kind or nature, presently known or unknown,  actual  or
contingent,  asserted or unasserted, foreseeable or  unforeseeable,
unanticipated or unsuspected, which any of them has or may have now
or  in  the  future,  arising directly  or  indirectly  out  of  or
involving   the  Shares,  the  Option,  the  Royalty,   the   Forte
Transaction,  the  Forte Documents and/or this  Agreement  and  any
other matter related thereto, save and except for those matters for
addressed  in  Section  1.3,  the  representations  and  warranties
contained  in  Article II hereof and, as described  in  the  Letter
Agreement,  the  mutually acceptable termination  of  that  certain
employment and non-compete agreement by and between the Company and
Steven Forte dated March 15, 1996, and as amended June 15, 1996.

1.3  FUTURE LITIGATION

     The  Parties, jointly and/or individually, covenant and  agree
to  forever refrain from instituting, prosecuting, maintaining,  or
assisting with any claims, suits and actions, which arise  out  of,
or  is  or may be, in whole or in part, based upon, related  to  or
connected with this Agreement, the Shares, the Option, the Royalty,
the  Forte  Transaction, the Forte Documents and any  other  matter
related thereto as they relate to the Parties.

1.4  FURTHER ASSURANCES

     The  Parties hereby acknowledge that they will use their  best
efforts to take, or cause to be taken, all appropriate action,  and
to  do,  or  cause  to  be done, all things  necessary,  proper  or
advisable  under applicable laws and regulations to consummate  and
make effective the transactions contemplated by this Agreement.

                            ARTICLE II
             REPRESENTATIONS AND WARRANTIES OF SELLERS
                                 
     The  Fortes  hereby  make  the following  representations  and
warranties to the Company and warrant that the following  are  true
and accurate on the date hereof:

2.1  AUTHORITY

     The  Fortes  have  the full right, power, legal  capacity  and
authority  to  enter into, and perform its obligations  under  this
Agreement,  including the execution and delivery of this  Agreement
and  the  transfer,  assignment, delivery and cancellation  of  the
Forte Documents in favor of the Company.

2.2  NO ASSIGNMENT

     The  Fortes hereby represent and warrant that they  have  not,
either  directly or indirectly, transferred, assigned,  granted  or
otherwise  forfeited  any interest, claim,  lien,  pledge,  option,
encumbrance,  charge, agreement, or other arrangement with  respect
to the Forte Documents.

                                -2-
                                 
<PAGE>

2.3  DIFFERENCE IN FACTS

     The Fortes fully understand that the facts presently known  to
them  may later be found to be different, and expressly accept  and
assume  the risk that the facts may be found to be different.   The
release and indemnification contained herein shall be effective  in
all  respects and shall not be subject to termination or rescission
because of any such difference in facts.

2.4  NO VIOLATION

     Neither  the  execution and delivery of  this  Agreement,  the
consummation  of  the  transactions contemplated  hereby,  nor  the
fulfillment  of the terms hereof by the Fortes will conflict  with,
or  result  in  a breach of or default under, any of the  terms  or
provisions  of  any agreement, note, indenture, mortgage,  deed  of
trust,  instrument lease, franchise or any other  understanding  to
which  Sellers are a party or by which it or any of its  assets  or
properties are bound.

                            ARTICLE III
                        GENERAL PROVISIONS
                                 
3.1  ENTIRE AGREEMENT

     This   Agreement  (together  with  all  exhibits,   documents,
agreements  and  instruments executed or  furnished  in  connection
herewith)  constitutes  the entire agreement  between  the  parties
pertaining to the subject matter hereof, and supersedes any and all
prior  or contemporaneous written or oral negotiations, agreements,
representations, and understandings of the parties with respect  to
such subject matter.

3.2  EXPENSES

     If  any legal action or any arbitration or other proceeding is
brought  for  the enforcement of this Agreement, or because  of  an
alleged   dispute,   breach,  default,  or   misrepresentation   in
connection  with  any  of  the provisions of  this  Agreement,  the
successful  or  prevailing party or parties shall  be  entitled  to
recover reasonable attorneys' fees and other costs incurred in that
action  or proceeding, in addition to any other relief to which  it
may be entitled.

3.3  MODIFICATION, AMENDMENT OR WAIVER

     This  Agreement may not be amended, supplemented or  otherwise
modified,  and  none  of  its  terms may  be  waived,  unless  such
amendment,  supplement, modification or waiver  is  in  an  express
writing  and executed by the party or parties to be bound  thereby.
The  failure  of  any  party  at  any  time  or  times  to  require
performance of any provision hereof shall not affect the  right  of
such  party at a later time to enforce the same, and no  waiver  of
any term or provision hereof on any one occasion shall be deemed to
be  a  waiver  of  the same or any other provision  hereof  at  any
subsequent time or times.

3.4  BINDING EFFECT; ASSIGNMENT

     This  Agreement shall be binding upon and inure to the benefit
of  the  parties  and  their  respective successors,  predecessors,
parents,  affiliates, subsidiaries, divisions, officers, directors,
shareholders,    employees,   advisors,   consultants,    insurers,
attorneys,  heirs, executors, administrators and any persons  claim
ing  rights by, through or under them; provided, however,  that  no
assignment of any rights or delegation of any obligations  provided
for  herein  may be made by either party to this Agreement  without
the prior written consent of the other party.

3.5  CONSTRUCTION

     This  Agreement  shall  be construed in  accordance  with  its
intent  and  without regard to any presumption or  any  other  rule
requiring  construction against the party causing the  same  to  be
drafted.

                                -3-
                                 
<PAGE>

3.6  GOVERNING LAW

     This   Agreement  shall  be  governed  by  and  construed   in
accordance  with the laws of the State of Nevada in effect  on  the
date  of  this  Agreement without resort to any  conflict  of  laws
principles, and the courts of the State of Nevada shall  have  sole
and  exclusive jurisdiction over any matter brought  under,  or  by
reason of, this Agreement.

3.7  SEVERABILITY

     If   any  term,  provision,  covenant  or  condition  of  this
Agreement, or any application thereof, should be held by a court of
competent  jurisdiction to be invalid, void or  unenforceable,  all
terms, provisions, covenants and conditions of this Agreement,  and
all  applications thereof, not held invalid, void or unenforceable,
shall  continue in full force and effect and shall  in  no  way  be
affected,  impaired  or  invalidated  thereby,  provided  that  the
invalidity,  voidness  or enforceability of such  term,  provision,
covenant or condition does not materially impair the ability of the
parties to consummate the transactions contemplated hereby.

3.8  NEUTRAL INTERPRETATION

     The  provisions  contained herein shall not  be  construed  in
favor  of  or  against any party because that party or its  counsel
drafted  this Agreement, but shall be construed as if  all  parties
prepared  this  Agreement, and any rules  of  construction  to  the
contrary  are  hereby  specifically  waived.   The  terms  of  this
Agreement were negotiated at arm's length by the parties hereto.

3.9  COUNTERPARTS

     This  Agreement  may  be executed at different  times  and  in
multiple  counterparts, each of which shall be deemed an  original,
but  all  of  which  together shall constitute  one  and  the  same
instrument.

     IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement on the date first set forth above.

     
     
          "FORTES"                        THE "COMPANY"
                                                 
STEVEN L. FORTE, an                CASINOVATIONS INCORPORATED,
individual                         a Washington corporation
                                   

/s/ Steven L. Forte                By: /s/ Steven J. Blad
-------------------------             ----------------------------
Steven L. Forte                        Steven J. Blad
                                   Its:  Chief Executive
                                   Officer and President
     
CHERYL FORTE,                      
 an individual
                                   

                                      
/s/ Cheryl Forte
-------------------------
Cheryl Forte