EX 10.16


    EXHIBIT
      10.16

    


    


    WHEREVER
      CONFIDENTIAL INFORMATION IS OMITTED HEREIN (SUCH DELETIONS ARE DENOTED BY AN
      ASTERISK), SUCH CONFIDENTIAL INFORMATION HAS BEEN SUBMITTED SEPARATELY TO THE
      SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL
      TREATMENT 

    


    GUARANTEE
      OF CREDIT FACILITY

    


    THIS
      Guarantee of Credit Facility is entered into among Nevada Gold and Casinos,
      Inc., (referred to below as “Borrower”); Black Hawk Gold, LTD (referred to below
      as “Guarantor”); and * (referred to below as "Lender').

    


    GUARANTEE
      of Credit Facility.
      For
      valuable consideration, Guarantor does hereby unconditionally guarantee the
      performance by Borrower of all of the terms, conditions and duties of Borrower,
      or any Guarantor, under the terms of that certain document entitled, “Amended
      and Restated Credit Facility” (“Credit Facility”) providing for a Fifty Five
      Million Dollar ($55,000,000.00) line of credit executed January 19, 2006,
      together with all such other and further documents, Notes, undertakings,
      Security Agreements, Commercial Pledge Agreements, Schedules and other
      instruments executed pursuant thereto. There are no conditions precedent,
      doctrines of marshalling, or other legal or equitable duties enforceable against
      the Lender or in favor of the Borrower or Guarantor which require the Lender
      to
      take any action against the Borrower or any other party or person prior to
      exercising her rights under this guarantee and any other instrument executed
      pursuant to the Credit Facility. This guarantee shall be interpreted to the
      broadest scope possible in favor of the Lender and shall be interpreted, if
      necessary to carry out the foregoing, as though Guarantor were the
      Borrower.

    


    This
      guarantee is secured by a commercial pledge agreement entered into
      contemporaneously with this guarantee. 

    


    This
      guarantee shall extend to all future advances, modifications, extensions and/or
      amendments of the terms of the Credit Facility and any instruments executed
      pursuant to the Credit Facility. Lender shall be under no obligation to inform
      Guarantor of any such future advances, modifications, extensions and/or
      amendments of the terms of the Credit Facility and any instruments executed
      pursuant to the Credit Facility and all such events shall give rise to guarantee
      liability hereunder as though existing on the date of the execution of this
      guarantee. 

    


    All
      terms
      of the Credit Facility and Commercial Pledge Agreement are incorporated herein
      by reference as though set forth at length herein. Guarantor acknowledges that
      it has had the opportunity to fully and completely review the Credit Facility
      and all instruments executed thereunder.

    


    


    Executed
      this 19th day of January, 2006.

    


    Guarantor:

    


    Black
      Hawk Gold, Ltd.

    


    By:  
      /s/
      H.
      Thomas Winn 
      
        

      

    

    Its
      President