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                      SHAREHOLDER AGREEMENT

      THIS SHAREHOLDER AGREEMENT (this "Agreement") is made as of
this  14th  day  of  December 1998 by and  between  Casinovations
Incorporated,  a Washington corporation (the "Company"),  Richard
Huson,   an   individual  ("Huson"),  Bob  Smith,  an  individual
("Smith") and Ron Keil, an individual ("Keil", collectively  with
Huson and Smith, the "Shareholders").

                            RECITALS

     WHEREAS,  the  Department of Corporations of  the  State  of
California  has  stated  that, as a condition  precedent  to  the
qualification  of the Company's common stock for offer,  sale  or
issuance  in  the State of California, certain shareholders  must
agree   for   themselves,  their  successors,   assigns,   heirs,
administrators or executors that certain shares of the  Company's
common  stock  shall  be  subject to  certain  disabilities  (the
"Disabilities")  until  such  disabilities  are  removed  by  the
Commissioner  of the Department of Corporations of the  State  of
California.

     WHEREAS, Huson and Randy Sines ("Sines") have executed  that
certain Shareholder Agreement dated August 27, 1998 whereby Huson
and  Sines  agreed to subject a certain number of  their  shares,
1,363,551  shares  (the "Huson Restricted  Shares")  and  470,851
shares  (the  "Sines  Restricted Shares"), respectively,  to  the
Disabilities;

     WHEREAS,  subject  to  the Disabilities,  Sines  desires  to
transfer,  sell  and assign the Sines Restricted  Shares  to  the
Shareholders  and the Shareholders desire to purchase  the  Sines
Restricted Shares from Sines;

     WHEREAS,  the  Shareholders and Sines  have  submitted  that
certain  Application for Consent to Transfer Securities  Pursuant
to  Section  25121 of the Corporate Securities Law of  1968  (the
"Application") to the Department of Corporations of the State  of
California  in order to obtain prior approval to the transfer  of
the  Sines  Restricted Shares by Sines to the  Shareholders  (the
"Trasnfer");

     WHEREAS, upon the approval of the Transfer by the Department
of  Corporations  of  the State of California,  the  Shareholders
desire to subject a certain portion of their respective shares to
the  aforementioned disabilities and desire to  enter  into  this
Agreement  for  the  purposes of subjecting such  shares  to  the
Disabilities;

      NOW,  THEREFORE, 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  the  parties
further covenant and agree as follows:

     1.    APPLICABLE SHARES.  The Shareholders hereby agree that
the following shares shall be restricted pursuant to the terms of
this Agreement:

          a.   181,788 shares of the Company's common stock to be
     held  of  record by Huson upon consummation of the  Transfer
     (the "Huson Shares");

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          b.   173,438 shares of the Company's common stock to be
     held  of  record by Smith upon consummation of the  Transfer
     (the "Smith Shares"); and

          c.   115,625 shares of the Company's common stock to be
     held  of  record by Keil upon consummation of  the  Transfer
     (the  "Keil Shares", collectively with the Huson Shares  and
     the Smith Shares, the "Shareholder Shares").

     The shares of the Company's common stock to be designated as
the  Shareholder  Shares shall be selected at the  discretion  of
Huson,   Smith  and  Keil  as  long  as  the  stock  certificates
evidencing  the respective shares of Huson, Smith  and  Keil  are
surrendered  to  the  Company  as of  or  immediately  after  the
Effective  Date (as defined herein) to comply with the  terms  of
this Agreement.

     2.    DISABILITIES.  Subject to Section 3 of this Agreement,
the  Shareholders hereby agree that the Shareholder Shares  shall
be  subject  to  the Disabilities as described below  until  such
Disabilities are removed by the Commissioner of the Department of
Corporations of the State of California:

          a.    The  Shareholder Shares shall not participate  in
     cash or property dividends paid by the Company;

          b.   The Shareholder Shares shall not participate in or
     be entitled to any distribution of assets in the event of  a
     liquidation of the Company;

          c.   All certificates evidencing the Shareholder Shares
     shall   bear  upon  their  face  a  legend   (the  "Legend")
     prominently  stamped  or  printed  thereon  and  in  capital
     letters of not less than ten-point type, as follows:

               THE    SHARES   REPRESENTED   BY    THIS
               CERTIFICATE  ARE  SUBJECT   TO   CERTAIN
               RESTRICTIONS,   INCLUDING   WAIVERS   OF
               DIVIDENDS AND ASSETS; AND IT IS UNLAWFUL
               TO  CONSUMMATE  A SALE  OR  TRANSFER  OF
               THEM,  OR ANY INTEREST THEREIN,  WITHOUT
               THE   PRIOR  WRITTEN  CONSENT   OF   THE
               COMMISSIONER  OF  CORPORATIONS  OR   THE
               STATE OF CALIFORNIA.

          d.     The   holders  or  persons  entitled   to   said
     Shareholder  Shares shall not consummate a sale or  transfer
     of  such  Shareholder  Shares, or any interest  therein,  or
     receive  any  consideration  therefor,  without  the   prior
     written  consent  of the Commissioner of the  Department  of
     Corporations  of  the  State  of  California;  except   that
     transfers  may be effected without such consent pursuant  to
     the  order  or  process of any court on condition  that  any
     certificates  evidencing the Shareholder  Shares  issued  to
     such transferee shall contain the Legend.

     3.    EFFECTIVE DATE.  This Agreement shall become effective
immediately upon the date (the "Effective Date") of the  approval
of  the  Department  of Corporations of the State  of  California
authorizing the Transfer.

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     4.    TERMINATION.   This  Agreement  shall  terminate  upon
written  order or direction of the Commissioner of the Department
of  Corporations  of the State of California  thus  removing  the
Disabilities.  In the event that the Disabilities are removed  as
to   a  portion  of  the  Shares,  the  shares  from  which   the
Disabilities have been removed will be allocated pro rate between
the Huson Shares and the Sines Shares.

     5.   COOPERATION.  The Company and the Shareholders agree to
cooperate fully with one another in order to achieve the purposes
of this Agreement and to take all actions and execute and deliver
all documents. whether or not specifically described herein, that
may  be  required to carry out the purposes and  intent  of  this
Agreement.

     6.   GOVERNING LAW.  This Agreement shall be governed by and
construed in accordance with the laws of the State of Nevada.

     7.    AMENDMENTS  AND MODIFICATIONS.  The  Company  and  the
Shareholders  agree  that no amendment or  modification  of  this
Agreement  shall be deemed effective unless and until  it  is  an
express   writing   executed  by  both  the   Company   and   the
Shareholders, and notification of such amendment or  modification
is  provided  to the Department of Corporations of the  State  of
California.

     8.    COUNTERPARTS.  This Agreement may be executed  in  any
number  of  counterparts,  each  of  which  shall  be  deemed  an
original,  but  all  of  which  together  shall  constitute   one
instrument.

     9.    BINDING EFFECT.  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 claiming rights  by,  through  or
under them.

     IN WITNESS WHEREOF, the Company and Shareholders have signed
this Agreement as of the date first written above.

             "HUSON"                             "SMITH"


RICHARD HUSON                        BOB SMITH
                                          
                                     
By: /s/ Richard Huson                By: /s/ Bob Smith
   -----------------------------        ----------------------------
    Richard Huson, an individual         Bob Smith, an individual
                                                    
                                                    
             "KEIL"                           THE "COMPANY"

RON KEIL                             CASINOVATIONS INCORPORATED
                                          
                                     
By: /s/ Ron Keil                     By: /s/ Steven J. Blad
   -----------------------------        ----------------------------
    Ron Keil, an individual               Steven J. Blad, President