EXHIBIT 10.10.3  THE LIENS GRANTED PURSUANT
TO THIS INSTRUMENT ARE SUBJECT AND SUBORDINATE TO THE LIENS GRANTED TO BANK OF
AMERICA, N.A., AS ADMINISTRATIVE AGENT, PURSUANT TO AN INTERCREDITOR AGREEMENT
DATED AS OF MARCH 5, 2002 WITH BANK OF AMERICA, N.A., AS ADMINISTRATIVE AGENT
(THE INTERCREDITOR AGREEMENT).  SECURITY AGREEMENT  This SECURITY AGREEMENT
(this Agreement) is dated as of
March 5, 2002 and entered into by and between CIRCUS
AND ELDORADO JOINT VENTURE, a Nevada general partnership (Partnership and in its capacity hereunder
Grantor), SILVER LEGACY CAPITAL CORP., a Nevada
corporation (Capital and in its
capacity hereunder Grantor and
together with Partnership Grantors),
for the benefit of THE BANK OF NEW YORK,as trustee (in such capacity herein
called Secured Party) under that
certain Indenture dated as of March 5, 2002 (the Indenture) with respect to the 10 1/8% Mortgage Notes due
2012 (the Notes) issued and to
be issued by Grantors.  PRELIMINARY
STATEMENTS  1.             Grantors and Secured Party have entered into the
Indenture.  2.             It is a condition to the issuance and sale of the Notes
pursuant to the Indenture and the Purchase Agreement dated as of February 22,
2002 by and among the Grantors and the Representative for the Initial Purchasers
named therein that the Grantors shall have executed this Agreement, and that
Grantors shall have granted the security interests and undertaken the
obligations contemplated by this Agreement.  NOW, THEREFORE, in consideration of the premises and for
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, Grantors hereby agree with Secured Party as follows:  SECTION 1.  Grant of Security. 
Each Grantor hereby grants to Secured Party a security interest in all of
such Grantors right, title and interest in and to the following, in each case
whether now or hereafter existing or in which such Grantor now has or hereafter
acquires an interest and wherever the same may be located (the Collateral):  (a)           all present and
future chattels, furniture, furnishings, goods, equipment, fixtures and all
other tangible personal property, of whatever kind and nature, including,
without limitation, any building or structure that is now or that may hereafter
be erected on the  
   Premises (as defined below),
and including any of the foregoing owned by Grantor and placed or located in
the Skyways (as defined below), further including, but not limited to,
machinery, materials, goods and equipment now or hereafter used in the construction
or operation of the Hotel (as defined below) (including, without limitation,
air conditioning, heating, electrical, lighting, fire fighting and fire
prevention, food and beverage service, laundry, plumbing, refrigeration,
security, sound, signaling, telephone, television, window washing and other
equipment and fixtures, of whatever kind or nature, including generators,
transformers, switching gear, boilers, burners, furnaces, piping, sprinklers,
sinks, tubs, valves, compressors, motors, carts, dumb waiters, elevators and
other lifts, floor coverings, hardware, keys, locks, organs, pianos, planters,
railings, scales, shelving, signs, tools, machinery, molds, dies, drills,
presses, planers, saws, furniture, business fixtures, trade fixtures, electric,
gas and other motor vehicles, uniforms, vacuum cleaners, hotel furniture,
furnishings and equipment, bathroom furniture and furnishings (including
towels, bathmats, hamperettes, shower curtains and other bath linens), beds and
bedding (including mattresses, springs, pillows, bed pads, sheets, blankets,
comforters, spreads and other bed linens and furnishings), bric-a-brac, chairs,
chests, vanities, secretaries, bureaus, chiffonniers, love seats, benches,
costumers, smoking stands, sand jars, desks, dressers, hangings, paintings,
pictures, frames, sculptures, lamps, light bulbs, mirrors, night stands,
ornaments, radios, stereo equipment, sofas, statuary, tables, telephones,
televisions, vases, window coverings, foodstuffs, beverages (including beer,
wine, liquor and other alcoholic beverages), and other consumables (including
soap, shampoo, cleaning supplies and paper goods), cutlery, cooking, baking and
other kitchen utensils and apparatus (including crockery, fryers, grills,
kettles, mixers, pots, pans, pails, racks, steamers and toasters), china and
other dishes, flatware, glassware, hollowware, serving pieces, trays, table
linens, washers, dryers, irons, ironing boards and other ironing equipment,
cables, outlets, plugs, wiring and related apparatus and fixtures, card
readers, cash registers, adding machines, calculators, computers, keyboards,
monitors, printers, printing equipment, envelopes, stationary, posting
machines, blank forms, typewriters, typewriter stands, other office and
accounting equipment and supplies, time stamps, time recorders, bookkeeping
machines, checking machines, payroll machines, computer reservations systems,
equipment used in the operation of casinos on the Premises (including but not
limited to, gaming devices and associated equipment (as defined in Nevada
Revised Statutes Chapter 463), including but not limited to, slot
machines, cards, poker chips and gaming tables) and all other goods, equipment,
furnishings, apparatus and fixtures that are now or may hereafter be located at
or used at or in connection with the Premises and all other tangible personal
property used or to be used at or in connection with, or placed or to be placed
in, rooms, halls, lounges, offices, lobbies, lavatories, basements, cellars,
vaults or other portions of the Hotel or of any other building or buildings
hereafter constructed or erected thereon, whether herein enumerated or not, and
whether or not contained in any such building, and which are used or to be used
or useful in the operation and maintenance thereof, or in any bar, casino,
hotel, restaurant, store, health spa, salon or other business conducted
thereon, together with all replacements and substitutions for any and all
personal property in which such Grantor has an interest, including without limitation
such goods and equipment as shall from time to time be located, placed,
installed or used in or upon, or procured for use, or to be used or useful in
connection with the operation of the whole, or any part of, the Hotel and all
parts thereof and all accessions thereto  2 
   (any and all such equipment,
replacements, substitutions, parts and accessions being the Equipment);  (b)           all present and
future inventory and merchandise in all of its forms including, but not limited
to, (i) all goods held by such Grantor for sale or lease or to be
furnished under contracts of service or so leased or furnished, (ii) all
raw materials, work in process, finished goods, and materials used or consumed
in the manufacture, packing, shipping, advertising, selling, leasing,
furnishing or production of such inventory or otherwise used or consumed in
such Grantors business, (iii) all goods in which such Grantor has an
interest in mass or a joint or other interest or right of any kind,
(iv) all goods that are returned to or repossessed by such Grantor, and
(v) all packing materials, supplies and containers relating to or used in
connection with any of the foregoing, and all accessions thereto and products
thereof (all such inventory, accessions and products being the Inventory) and all negotiable documents of
title:  (including without limitation
warehouse receipts, dock receipts and bills of lading) issued by any person
covering any of the foregoing (any such negotiable document of title being a Negotiable Document of Title);  (c)           all present and
future accounts, accounts receivable, rentals, revenues, receipts, payments,
and income of any nature whatsoever, including, without limitation, those
derived from or received with respect to hotel rooms, banquet facilities,
convention facilities, retail premises, bars, restaurants, casinos and any
other facilities on the Premises and any facilities in the Skyways leased by
such Grantor, agreements, contracts, leases, contract rights, payment
intangibles, rights to payment, instruments, documents, letter-of-credit
rights, chattel paper (whether tangible or electronic), security agreements,
guaranties, undertakings, surety bonds, insurance policies, condemnation
deposits and awards, notes and drafts, securities, certificates of deposit and
the right to receive all payments thereon or in respect thereof (whether
principal, interest, fees or otherwise), contract rights (other than rights
under contracts or governmental permits that may not be transferred by law),
including, without limitation, rights to all deposits from tenants and other
users of the Hotel or facilities in the Skyways leased by such Grantor, rights
under all contracts relating to the construction, renovation or restoration of
any of the improvements now or hereafter located on the Premises or the
financing thereof and all rights under payment or performance bonds,
warranties, and guaranties, and all rights to payment from any credit/charge
card organization or entity such as or similar to, and including, without
limitation, the organizations or entities that sponsor and administer,
respectively, the American Express Card, the Carte Blanche Card, the Diners
Club Card, the Discover Card, the MasterCard and the Visa Card, books of
account, and principal, interest and payments due on account of goods sold,
services rendered, loans made or credit extended, on or in connection with the
Hotel and all forms of obligations owing to and rights of such Grantor or in
which such Grantor may have any interest, however created or arising (any and
all such accounts, contract rights, payment intangibles, chattel paper,
documents, instruments, general intangibles and other obligations being the Accounts, and any and all such security
agreements, leases and other contracts being the Related Contracts);  (d)           the agreements
listed in Schedule I annexed hereto, as each such agreement may be
amended, supplemented or otherwise modified from time to time (said  3 
   agreements, as so amended,
supplemented or otherwise modified, being referred to herein individually as an
Assigned Agreement and
collectively as the Assigned Agreements),
including without limitation (i) all rights of such Grantor to receive
moneys due or to become due under or pursuant to the Assigned Agreements,
(ii) all rights of such Grantor to receive proceeds of any insurance,
indemnity, warranty or guaranty with respect to the Assigned Agreements,
(iii) all claims of such Grantor for damages arising out of any breach of
or default under the Assigned Agreements, and (iv) all rights of such
Grantor to terminate, amend, supplement, modify or exercise rights or options
under the Assigned Agreements, to perform thereunder and to compel performance
and otherwise exercise all remedies thereunder;  (e)           all present and
future right, title and interest of such Grantor in and to all leases,
subleases, licenses, concessions, franchises and other use or occupancy
agreements (collectively, Leases)
(except, however, agreements made by such Grantor in the ordinary course of
business for short-term use by members of the public of guest rooms and public
rooms, including banquet and meeting facilities, located in the Improvements
(as defined below)), and any amendments, modifications, extensions or renewals
thereof, whether or not specifically herein described, and all amendments to
the same, including, but not limited to, the following:  (i) all payments due and to become due
under such Leases, whether as rent, damages, insurance payments, condemnation
awards, or otherwise; (ii) all claims, rights, powers, privileges and
remedies under such Leases; and (iii) all rights of such Grantor under
such Leases to exercise any election or option, or to give or receive any
notice, consent, waiver or approval, or to accept any surrender of the premises
or any part thereof, together with full power and authority in the name of such
Grantor, or otherwise, to demand and receive, enforce, collect, and receipt for
any or all of the foregoing, to endorse or execute any checks or any
instruments or orders, to file any claims, and to take any other action that
Secured Party may deem necessary or advisable in connection therewith;  (f)            all present and
future deposit accounts of such Grantor, including, without limitation, the
Circus and Eldorado Joint Venture Account maintained at the office of Bank of
America N.A., any demand, time, savings, passbook or like account maintained by
such Grantor with any bank, savings and loan association, credit union or like
organization. and all money, cash and cash equivalents of such Grantor, whether
or not deposited in any such deposit account;  (g)           all shares of, and
all securities convertible into and warrants, options and other rights to
purchase or otherwise acquire, stock of any Person that, after the date of this
Agreement, becomes, as a result of any occurrence, a direct Subsidiary of such
Grantor (the Pledged Shares),
the certificates or other instruments representing such shares, securities,
warrants, options or other rights and any interest of such Grantor in the
entries on the books of any financial intermediary pertaining to such shares,
and all dividends, cash, warrants, rights, instruments and other property or
proceeds from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of such shares, securities, warrants,
options or other rights;  4 
   (h)           all indebtedness
from time to time owed to such Grantor by any Person that, after the date of
this Agreement, becomes, as a result of any occurrence, an Affiliate or a
direct or indirect Subsidiary of such Grantor, and all interest, cash,
instruments and other property or proceeds from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or all
of such indebtedness (the Pledged Debt);  (i)            all present and
future general intangibles (including but not limited to all governmental
permits relating to construction or other activities on the premises), all tax
refunds of every kind and nature to which such Grantor now or hereafter may
become entitled, however arising, all other refunds, and all deposits,
goodwill, chooses in action, rights to payment or performance, gambling debts
or gaining debts owed to such Grantor by such Grantors patrons (whether or not
evidenced by a note), judgments taken on any rights or claims included in the
Collateral, trade secrets, computer programs, software, customer lists,
business names, trademarks, trade names and service marks (including, but not
limited to: Silver Legacy Hotel Casino and any derivation thereof, including
any and all state and federal applications and registrations thereof), patents,
patent applications, licenses, copyrights, technology, processes, proprietary
information and insurance proceeds;  (j)            all present and
future books and records, including, without limitation, books of account and
ledgers of every kind and nature, ledger cards, computer programs, tapes, disks
and other information storage devices, all related data processing software,
and all electronically recorded data relating to such Grantor or its business
or the Hotel, all receptacles and containers for such records, and all files
and correspondence;  (k)           all present and
future maps, plans, specifications, surveys, studies, reports, data and
drawings (including, without limitation architectural, structural, mechanical
and engineering plans and specifications, studies, data and drawings) prepared
for or relating to the development of the Hotel or the construction, renovation
or restoration of any improvements on the Premises and the Skyways or the
extraction of minerals, sand, gravel or other valuable substances from the
Premises, together with all amendments and modifications thereto;  (l)            all present and
future licenses, permits, variances, special permits, franchises, certificates,
rulings, certifications, validations, exemptions, filings, registrations,
authorizations, consents, approvals, waivers, orders, rights and agreements
(including options, option rights and contract rights), other than those
(including non-transferrable gaming permits) that may not be transferred by
law, now or hereafter obtained by such Grantor from any governmental authority
having or claiming jurisdiction over the Hotel, the Premises or the Skyways or
any other element of the Collateral or providing access thereto, or the
operation of any business on, at, or from the Hotel or the Skyways;  (m)          all present and
future goods, including, without limitation, all consumer goods, inventory,
equipment, and other supplies, of whatever kind or nature, and any and all
other goods (including without limitation embedded software), wherever located,
used or to be used in connection with or in the conduct of such Grantors
business;  5 
   (n)           all present and
future investment property, stocks, bonds, debentures, securities, subscription
rights, options, warrants, puts, calls, certificates, partnership interests,
joint venture interests, investments, brokerage accounts and all rights,
preferences, privileges, dividends, distributions, redemption payments and
liquidation payments received or receivable with respect thereto;  (o)           all present and
future accessions, appurtenances, components, repairs, repair parts, spare
parts, replacements, substitutions, additions, issue and improvements to or of
or with respect to any of the foregoing;  (p)           all other fixtures
and storage and office facilities, and all accessions thereto and products
thereof and all water stock relating to the Premises;  (q)           all other tangible
and intangible personal property of such Grantor;  (r)            all rights,
remedies, powers and privileges of such Grantor with respect to any of the
foregoing; and  (s)           any and all
proceeds, products, rents, income and profits of any of the foregoing,
including, without limitation, all money, accounts, payment intangibles,
general intangibles, deposit accounts, documents, instruments, chattel paper,
investment property, letter of credit rights, goods, insurance proceeds
(whether or not the Secured Party is the loss payee), and any other tangible or
intangible property received upon the sale or disposition of any of the
foregoing (it being agreed, for purposes hereof, that the term proceeds includes whatever is receivable
or received when any of the Collateral is sold, collected, exchanged or
otherwise disposed of, whether such disposition is voluntary or involuntary).  Notwithstanding anything to the contrary contained herein, Secured
Party acknowledges that it has no security interest in (i) any Equipment
securing Indebtedness permitted to be incurred under the terms of the Indenture
(and that is permitted to be so secured under the Indenture), (ii) any
cash of Grantors described in clauses (f), (i) and (n) above, to the extent
such a security interest is prohibited by any Gaming Laws (as defined below) or
(iii) any deposit account described in clause (f) above to the extent such
a security interest is prohibited by applicable law.  SECTION 2.  Security
for Obligations.
This Agreement secures, and the Collateral is collateral security for, the
prompt payment or performance in full when due, whether at stated maturity, by
required prepayment, declaration, acceleration, demand or otherwise (including
the payment of amounts that would become due but for the operation of the
automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C.
§ 362(a)), of all obligations and liabilities of every nature of Grantors
now or hereafter existing under or arising out of or in connection with the
Indenture and Notes and all extensions or renewals thereof, including, without
limitation, any obligation incurred by Grantors with respect to the execution
of any Assigned Agreement executed as provided hereunder and fees, expenses,  6 
   indemnities or otherwise,
whether voluntary or involuntary, direct or indirect, absolute or contingent,
liquidated or unliquidated, whether or not jointly owed with others, and
whether or not from time to time decreased or extinguished and later increased,
created or incurred, and all or any portion of such obligations or liabilities
that are paid, to the extent all or any part of such payment is avoided or
recovered directly or indirectly from Secured Party or any holder of Notes as a
preference, fraudulent transfer or otherwise (all such obligations and
liabilities being the Underlying Debt),
and all obligations of every nature of Grantors now or hereafter existing under
this Agreement (all such obligations of Grantors, together with the Underlying
Debt, being the Secured Obligations).  SECTION 3.  Grantors
Remains Liable.  Anything contained herein to the contrary
notwithstanding, (a) Grantors shall remain liable under any contracts and
agreements included in the Collateral, to the extent set forth therein, to
perform all of their respective duties and obligations thereunder to the same
extent as if this Agreement had not been executed, (b) the exercise by
Secured Party of any of its rights hereunder shall not release Grantors from
any of their respective duties or obligations under the contracts and
agreements included in the Collateral, and (c) Secured Party shall not have
any obligation or liability under any contracts and agreements included in the
Collateral by reason of this Agreement or otherwise, nor shall Secured Party be
obligated to perform any of the obligations or duties of Grantors thereunder or
to take any action to collect or enforce any claim for payment assigned
hereunder.  SECTION 4.  Representations
and Warranties.  Each Grantor, jointly and severally
represents and warrants as follows:  (a)           Ownership of
Collateral.  Except for the security
interest created by this Agreement and any Liens permitted pursuant to the
Indenture, Grantors own the Collateral free and clear of any Lien.  Except such as may have been filed in favor
of Secured Party relating to this Agreement and Bank of America, N.A. relating
to that certain Second Amended and Restated Credit Agreement dated as of
February     , 2002, by and among the
Partnership, the lenders described therein and Bank of America, N.A., as
administrative agent (the Credit Agreement),
no effective financing statement or other instrument similar in effect covering
all or any part of the Collateral is on file in any filing or recording office.  (b)           Location of
Equipment and Inventory.  All of the
Equipment and Inventory is, as of the date hereof, located at the places
specified in Schedule II annexed hereto.  (c)           Office
Locations:  Other Names.  The chief place of business, the chief
executive office and the office where each Grantor keeps its records regarding
the Accounts and all originals of all chattel paper that evidence Accounts is,
and has been for the four month period preceding the date hereof, located at
430 North Virginia Street, Reno, Nevada. 
Grantors have not in the past done, and do not now do, business under
any other name (including any trade-name or fictitious business name) except
Silver Legacy Hotel & Casino.  7 
   (d)           Governmental
Authorizations.  No authorization,
approval or other action by, and no notice to or filing with, any governmental
authority or regulatory body is required for either (i) the grant by
Grantors of the security interest granted hereby, (ii) the execution,
delivery or performance of this Agreement by Grantors, or (iii) the
perfection of or the exercise by Secured Party of its rights and remedies
hereunder (except (i) authorization from any Gaming Authority for the
exercise by Secured Party of certain of its rights and remedies hereunder;
(ii) the filing of Uniform Commercial Code financing statements with the
office of the Secretary of State of the State of Nevada and (iii) as has
been previously taken by or at the direction of Grantors).  (e)           Perfection.  This Agreement, together with the filing of
a UCC-1 financing statement describing the Collateral with the Secretary of
State of Nevada and the filing and recording of the Deed of Trust (as defined
below) with the Washoe County Recorder, which filings and recordings have been
made, create a valid, perfected and enforceable security interest (subject only
to Permitted Liens) in, and lien on, the Collateral, to the fullest extent that
such security interest may be perfected by the filing of such financing
statement under the Uniform Commercial Code in effect in the State of Nevada,
securing the payment of the Secured Obligations, and all filings and other
actions necessary or desirable to perfect and protect such security interest
have been duly made or taken provided that it is acknowledged that continuation
statements must be filed in a timely manner in order to continue the perfection
of such security interest and additional filings may have to be made in the
event Grantor changes its name, principal place of business, chief executive
officer or form of organization.  (f)            Other
Information.  All information
heretofore, herein or hereafter supplied to Secured Party by or on behalf of
Grantors with respect to the Collateral is accurate and complete in all
material respectsor omits to state a material fact necessary in order
to make the statements herein or therein, in the light of the circumstances
under which they were made, not misleading.  SECTION 5.  Further
Assurances.  (a)           Each Grantor agrees
that from time to time, at the expense of such Grantors, such Grantor will
promptly execute and deliver all further instruments and documents, and take
all further action, that may be necessary or desirable, or that Secured Party
reasonably may request, in order to perfect and protect any security interest
granted or purported to be granted hereby or to enable Secured Party to
exercise and enforce its rights and remedies hereunder with respect to any
Collateral.  Without limiting the
generality of the foregoing, each Grantor will: (i) at the request of
Secured Party mark conspicuously each item of chattel paper included in the
Accounts, each Related Contract and, at the request of Secured Party, each of
its records pertaining to the Collateral, with a legend, in form and substance
satisfactory to Secured Party, indicating that such Collateral is subject to
the security interest granted hereby, (ii) at the request of Secured
Party, deliver and pledge to Secured Party hereunder all promissory notes and
other instruments (including checks) and all original counterparts of chattel
paper constituting Collateral, duly endorsed and accompanied by duly  8 
   executed instruments of
transfer or assignment, all in form and substance satisfactory to Secured
Party, (iii) file such financing or continuation statements, or amendments
thereto, and such other instruments or notices, as may be necessary or
desirable, or as Secured Party may request, in order to perfect and preserve
the security interests granted or purported to be granted hereby, (iv) at
any reasonable time, upon request by Secured Party, exhibit the Collateral to
and allow inspection of the Collateral by Secured Party, or persons designated
by Secured Party, and (v) at Secured Partys request, appear in and defend
any action or proceeding that may affect such Grantors title to or Secured
Partys security interest in all or any significant part of the Collateral.  (b)           Each Grantor hereby
authorizes Secured Party to file one or more financing or continuation
statements, and amendments thereto, relative to all or any part of the
Collateral without the signature of such Grantor.  Each Grantor agrees that a carbon, photographic or other
reproduction of this Agreement or of a financing statement signed by such
Grantor shall be sufficient as a financing statement and may be filed as a
financing statement in any and all jurisdictions.  Nothing contained herein shall impose any obligation onSecured Party to file any such financing or
continuation statements, or to make any determination or judgment as to the
necessity of making any such filings.  (c)           Each Grantor will
furnish to Secured Party from time to time statements and schedules further
identifying and describing the Collateral and such other reports in connection
with the Collateral as Secured Party may reasonably request, all in reasonable
detail.  (d)           Each Grantor agrees,
after the occurrence and during the continuation of an Event of Default, in the
event that Secured Party shall apply for or appoint an agent to apply for a
gaming or liquor license with any Gaming Authority or any governmental authority
or seek to obtain consent from any Gaming Authority to foreclose on the
Collateral (including all gaming permits) and operate the Premises or otherwise
seek to enforce its rights hereunder, such Grantor shall provide such
cooperation as is necessary in order for Secured Party to obtain the full
benefits of this Agreement.  Without
limiting the generality of the foregoing, if any Gaming Authority or any
governmental authority shall require any amendments to the Collateral Documents
or require such Grantor to execute such other documents as a condition to or as
a part of such approval process, such Grantor shall consent to such amendments
and/or execute such documents promptly.  SECTION 6.  Certain
Covenants of Grantor.  Grantors shall:  (a)           not use or permit any
Collateral to be used unlawfully or in violation of any provision of this
Agreement or any applicable statute, regulation or ordinance or any policy of
insurance covering the Collateral;  (b)           notify Secured Party
of any change in either Grantors name, identity, corporate, general
partnership or other organizational structure within 15 days of such change,
and file such additional UCC-1 financing statements or other documents or
amendments  9 
   thereto with such governmental
agencies as may be appropriate to continue the perfection of the security
interests granted hereby;  (c)           give Secured Party
30 days prior written notice of any change in either Grantors jurisdiction of
organization, place of business, chief executive office or residence or the
office where either Grantor keeps its records regarding the Accounts and all
originals of all chattel paper that evidence Accounts, and file such additional
UCC-1 financing statements or other documents or amendments thereto with such
governmental agencies as may be appropriate to continue the perfection of the
security interests granted hereby;  (d)           if Secured Party
gives value to enable either Grantor to acquire rights in or the use of any
Collateral, use such value for such purposes; and  (e)           pay promptly when
due all property and other taxes, assessments and governmental charges or
levies imposed upon, and all claims (including claims for labor, materials and
supplies) against, the Collateral, except to the extent the validity thereof is
being contested in good faith and for which adequate reserves have been
established; provided that Grantors shall in any event pay such taxes,
assessments, charges, levies or claims not later than five days prior to the
date of any proposed sale under any judgement, writ or warrant of attachment
entered or filed against either Grantor or any of the Collateral as a result of
the failure to make such payment.  SECTION 7.  Special
Covenants With Respect to Equipment and Inventory.  Subject
to the terms of the Intercreditor Agreement, Grantors shall:  (a)           keep the Equipment
and Inventory at the places therefor specified on Schedule II
annexed hereto or, upon 30 days prior written notice to Secured Party, at
such other places in jurisdictions where all action that may be necessary or
desirable, or that Secured Party may request, in order to perfect and protect
any security interest granted or purported to be granted hereby, or to enable
Secured Party to exercise and enforce its rights and remedies hereunder, with
respect to such Equipment and Inventory shall have been taken;  (b)           cause the Equipment
to be maintained and preserved in the same condition, repair and working order
as when new, ordinary wear and tear excepted, and shall forthwith, or, [in the case of any loss or damage to any
of the Equipment when subsection (c) of Section 8 is not applicable], as quickly as practicable after the
occurrence thereof, make or cause to be made all repairs, replacements and
other improvements in connection therewith that are necessary or desirable to
such end.  Grantors shall promptly
furnish to Secured Party a statement respecting any material loss or damage to
any of the Equipment;  (c)           provide prompt
written notice to Secured Party of any material breach or default by any party
to any Assigned Agreement;  (d)           notify Secured Party
of the establishment after the date hereof of any deposit accounts in which
Secured Party may take a security interest pursuant to applicable  10 
   law and take such steps as may
be necessary or appropriate, or requested by Secured Party, to perfect Secured
Partys lien therein and ensure the priority and enforceability thereof;  (e)           perform all acts
that are necessary or desirable to cause all licenses, permits, variances,
special permits, franchises, certificates, rulings, certifications,
validations, exemptions, filings, registrations, authorizations, consents,
approvals, waivers, orders, rights, and agreements in which a security interest
has been conveyed to Secured Party pursuant to subsection 1(h) to remain in
full force and effect;  (f)            keep correct and
accurate records of the Inventory, itemizing and describing the kind, type and
quantity of Inventory, Grantors cost therefor and (where applicable) the
current list prices for the Inventory substantially consistent with the
practice of other gaming institutions in connection with their gaming
operations in the State of Nevada;  (g)           upon the occurrence
of an Event of Default, if any Inventory is in possession or control of any of
either Grantors agents or processors, instruct such agent or processor to hold
all such Inventory for the account of Secured Party and subject to the
instructions of Secured Party; and  (h)           promptly upon the
issuance and delivery to Grantor of any Negotiable Document of Title, deliver
such Negotiable Document of Title to Secured Party.  SECTION 8.  Insurance.  (a)           Grantor shall, at
its own expense, maintain insurance with respect to the Equipment and Inventory
in accordance with the terms of the Indenture.  (b)           Reimbursement under
any liability insurance maintained by either Grantor pursuant to this Section 8
may be paid directly to the Person who shall have incurred liability covered by
such insurance.  In case of any loss
involving damage to Equipment or Inventory when subsection (c) of this
Section 8 is not applicable, Grantors shall make or cause to be made the
necessary repairs to or replacements of such Equipment or Inventory, and any
proceeds of insurance maintained by Grantors pursuant to this Section 8 shall
be paid to Grantors as reimbursement for the costs of such repairs or
replacements.  (c)           Upon (i) the
occurrence and during the continuation of any Event of Default or (ii) the
actual or constructive loss (in excess of $1,000,000 per occurrence) of any
Equipment or Inventory, all insurance payments in respect of such Equipment or
Inventory shall be paid to and applied by Secured Party as specified in
Section 19.  SECTION 9.  Special
Covenants With Respect to Accounts and Related Contracts.  (a)           Each Grantor shall
keep its chief place of business and chief executive office and the office
where it keeps its records concerning the Accounts and Related  11 
   Contracts, and all originals of
all chattel paper that evidence Accounts, at the location therefor specified in
Section 4 or, upon 30 days prior written notice to Secured Party, at
such other location in a jurisdiction where all action that may be necessary or
desirable, or that Secured Party may request, in order to perfect and protect
any security interest granted or purported to be granted hereby, or to enable
Secured Party to exercise and enforce its rights and remedies hereunder, with respect
to such Accounts and Related Contracts shall have been taken.  Each Grantor will hold and preserve such
records and chattel paper and will permit representatives of Secured Party at
any time during normal business hours to inspect and make abstracts from such
records and chattel paper, and each Grantor agrees to render to Secured Party,
at such Grantors cost and expense, such clerical and other assistance as may
be reasonably requested with regard thereto. 
Promptly upon the request of Secured Party, each Grantor shall deliver
to Secured Party complete and correct copies of each Related Contract.  (b)           Each Grantor shall,
for not less than 5 years from the date on which such Account arose,
maintain (i) complete records of each Account, including records of all
payments received, credits granted and merchandise returned, and (ii) all
documentation relating thereto.  (c)           Except as otherwise
provided in this subsection (c), each Grantor shall continue to collect,
at its own expense, all amounts due or to become due to such Grantors under the
Accounts (but, other than with respect to security deposits, in no event more
than one month in advance) and Related Contracts.  In connection with such collections, each Grantor may take (and,
at Secured Partys direction, shall take) such action as such Grantor or
Secured Party may deem necessary or advisable to enforce collection of amounts
due or to become due under the Accounts; provided, however, that subject
to the terms of the Intercreditor Agreement, Secured Party shall have the right
at any time, upon the occurrence and during the continuation of an Event of
Default and upon written notice to Grantor of its intention to do so, to notify
the account debtors or obligors under any Accounts of the assignment of such
Accounts to Secured Party and to direct such account debtors or obligors to
make payment of all amounts due or to become due to Grantors thereunder
directly to Secured Party, to notify each Person maintaining a lockbox or
similar arrangement to which account debtors or obligors under any Accounts
have been directed to make payment to remit all amounts representing
collections on checks and other payment items from time to time sent to or
deposited in such lockbox or other arrangement directly to Secured Party and,
upon such notification and at the expense of Grantors, to enforce collection of
any such Accounts and to adjust, settle or compromise the amount or payment
thereof, in the same manner and to the same extent as Grantors might have done.  After receipt by either Grantor of the
notice from Secured Party referred to in the proviso to the preceding
sentence, (i) all amounts and proceeds (including checks and other
instruments) received by such Grantor in respect of the Accounts and the
Related Contracts shall be received in trust for the benefit of Secured Party
hereunder, shall be segregated from other funds of such Grantor and shall be
forthwith paid over or delivered to Secured Party in the same form as so
received (with any necessary endorsement) to be held as cash Collateral and
applied as provided by Section 19, and (ii) such Grantor shall not adjust,
settle or compromise the amount or payment of any Account, or release wholly or
partly any account debtor or obligor thereof, or allow any credit  12 
   or discount thereon (other than
settlements in the ordinary course of business and substantially consistent
with the practice at other gaming institutions in connection with their gaming
operations in the State of Nevada with payors of such Accounts reached to
facilitate collection from such payors of such Accounts).  SECTION 10.  Special
Provisions With Respect to the Assigned Agreements.  (a)           Each Grantor shall
at its expense:  (i)            perform and observe
all terms and provisions of the Assigned Agreements, as permitted to be amended
or otherwise modified pursuant to clause (b)(ii) below, to be performed or
observed by it, maintain the Assigned Agreements in full force and effect,
enforce the Assigned Agreements in accordance with their terms, and take all
such action to such end as may be from time to time requested by Secured Party
except to the extent that failure to take any such action, either individually
or in the aggregate, would not result in a Material Adverse Effect (as defined
below); and  (ii)           furnish to Secured
Party, promptly upon receipt thereof, copies of all notices of default received
by such Grantor under or pursuant to the Assigned Agreements, and from time to
time (A) furnish to Secured Party such information and reports regarding
the Assigned Agreements as Secured Party may reasonably request and
(B) upon request of Secured Party make to the appropriate counterparty to
an Assigned Agreement such demands and requests for information and reports or
for action as such Grantor is entitled to make under the Assigned Agreements.  (b)           Neither Grantor
shall:  (i)            cancel or terminate
any of the Assigned Agreements or consent to or accept any cancellation or
termination thereof in any case with respect to the General Contractors
Contract and, with respect to the other Assigned Agreements, if such
cancellation or termination, together with all other such cancellations or
terminations, could reasonably be expected to result in a Material Adverse
Effect;  (ii)           amend or otherwise
modify the Assigned Agreements or give any consent, waiver or approval, or
approve or enter into any change order thereunder if the effect of such
amendment or modification, together with all other amendments, modifications,
consents, waivers or approvals made or consents, waivers or approvals given or
change orders approved or entered into, is to increase materially the
obligations of Partnership thereunder or to confer any additional rights on the
counterparties to such Assigned Agreements which could reasonably be expected
to be materially adverse to Partnership or holders of the Notes;  (iii)          waive any default
under or breach of the Assigned Agreements if such waiver, together with all
other such waivers could reasonably be expected to result in a Material Adverse
Effect;  13 
   (iv)          consent to or permit
or accept any prepayment of amounts to become due under or in connection with
the Assigned Agreements, except as expressly provided therein; or  (v)           take any other
action in connection with the Assigned Agreements that would impair the value
of the interest or rights of such Grantor thereunder or that would impair the
interest or rights of Secured Party in any case with respect to the General
Contractors Contract and, with respect to the other Assigned Agreements if
such impairment could reasonably be expected, to result in a Material Adverse
Effect.  SECTION 11.  Voting
Rights; Dividends; Etc.  (a)           So long as no Event
of Default shall have occurred and be continuing:  (i)            Grantors shall be
entitled to exercise any and all voting and other consensual rights pertaining
to the Pledged Shares or Pledged Debt or any part thereof for any purpose not
inconsistent with the terms of this Agreement; provided, however, that
Grantors shall not exercise or refrain from exercising any such right if
Secured Party shall have notified either Grantor that, in Secured Partys
judgment, such action would have a material adverse effect on the value of the Pledged
Shares or Pledged Debt or any part thereof; and provided, further, that
Grantors shall give Secured Party at least five Business Days prior written
notice of the manner in which it intends to exercise, or the reasons for
refraining from exercising, any such right. 
It is understood, however, that neither (A) the voting by either
Grantor of any Pledged Shares for or either Grantors consent to the election
of directors at a regularly scheduled annual or other meeting of stockholders
or with respect to incidental matters at any such meeting nor (B) either
Grantors consent to or approval of any action otherwise permitted under this
Agreement shall be deemed inconsistent with the terms of this Agreement within
the meaning of this subsection 11(a)(i), and no notice of any such voting
or consent need be given to Secured Party.  (ii)           Grantors shall be
entitled to receive and retain and to utilize free and clear of the lien of
this Agreement, any and all dividends and interest paid in respect of the
Pledged Shares or Pledged Debt; provided, however, that, subject to the
terms of the Intercreditor Agreement, any and all  (A)          dividends and
interest paid or payable other than in cash in respect of, and instruments and
other property received, receivable or otherwise distributed in respect of, or
in exchange for, any Pledged Shares or Pledged Debt,  (B)           dividends and other
distributions paid or payable in cash in respect of any Pledged Shares or
Pledged Debt in connection with a partial or total liquidation or dissolution
or in connection with a reduction of capital, capital surplus or
paid-in-surplus, and  14 
   (C)           cash paid, payable
or otherwise distributed in respect of principal or in redemption of or in
exchange for any Pledged Shares or Pledged Debt,  shall be, and shall forthwith be delivered to Secured Party to hold as,
Collateral and shall, if received by either Grantor, be received in trust for
the benefit of Secured Party, be segregated from the other property or funds of
such Grantor and be forthwith delivered to Secured Party as Pledged Shares or
Pledged Debt, as the case may be, in the same form as so received (with all
necessary endorsements).  (iii)          Secured Party shall
promptly execute and deliver (or cause to be executed and delivered) to
Grantors all such proxies, dividend payment orders and other instruments as
Grantors may from time to time reasonably request for the purpose of enabling
Grantors to exercise the voting and other consensual rights which they are
entitled to exercise pursuant to paragraph (i) above and to receive the
dividends, principal or interest payments which it is authorized to receive and
retain pursuant to paragraph (ii) above.  (b)           Subject to the terms
of the Intercreditor Agreement, upon the occurrence and during the continuation
of an Event of Default:  (i)            Upon written notice
from Secured Party to Grantors, all rights of Grantors to exercise the voting
and other consensual rights which they would otherwise be entitled to exercise
pursuant to subsection 11(a)(i) shall cease, and all such rights shall
thereupon become vested in Secured Party who shall thereupon have the sole
right to exercise such voting and other consensual rights.  (ii)           All rights of
Grantors to receive the dividends and interest payments which they would
otherwise be authorized to receive and retain pursuant to
subsection 11(a)(ii) shall automatically cease, and all such rights shall
thereupon become vested in Secured Party who shall thereupon have the sole right
to receive and hold as Collateral such dividends and interest payments. (iii)          All dividends,
principal and interest payments which are received by Grantors contrary to the
provisions of paragraph (ii) of this subsection 11(b) shall be
received in trust for the benefit of Secured Party, shall be segregated from
other funds of Grantors and shall forthwith be paid over to Secured Party as
Collateral in the same form as so received (with any necessary endorsements).  (c)           In order to permit
Secured Party to exercise the voting and other consensual rights which it may
be entitled to exercise pursuant to subsection 11(b)(i) and to receive all
dividends and other distributions which it may be entitled to receive under
subsection 11(a)(ii) or subsection 11(b)(ii), (i) Grantors shall
promptly execute and deliver (or cause to be executed and delivered) to Secured
Party all such proxies, dividend payment orders and other instruments as
Secured Party may from time to time reasonably request and (ii) without
limiting the effect of the immediately preceding clause (i), Grantors
hereby grant to Secured Party an irrevocable proxy to vote the Pledged Shares
and to exercise all other  15 
   rights, powers, privileges and
remedies to which a holder of the Pledged Shares would be entitled (including,
without limitation, giving or withholding written consents of shareholders,
calling special meetings of shareholders and voting at such meetings), which
proxy shall be effective, automatically and without the necessity of any action
(including any transfer of any Pledged Shares on the record books of the issuer
thereof) by any other Person (including the issuer of the Pledged Shares or any
officer or agent thereof), upon the occurrence and during the continuance of an
Event of Default and which proxy shall only terminate upon the payment in full
of the Secured Obligations.  SECTION 12.  Deposit
Accounts.  Upon the occurrence and during the
continuation of an Event of Default, Secured Party and each Lender may exercise
dominion and control over, and refuse to permit further withdrawals (whether of
money, securities, instruments or other property) from any deposit accounts
maintained with Secured Party or such Lender constituting part of the
Collateral.  SECTION 13.  License
of Patents, Trademarks, Copyrights, etc.  Grantors hereby assign,
transfer and convey to Secured Party, effective upon the occurrence and during
the continuance of any Event of Default, the nonexclusive right and license to
use all trademarks, tradenames, copyrights, customers lists, patents or
technical processes owned or used by Grantors that relate to the Collateral and
any other collateral granted by Grantors as security for the Secured
Obligations, together with any goodwill associated therewith, all to the extent
necessary to enable Secured Party to use, possess and realize on the Collateral
and to enable any successor or assign to enjoy the benefits of the
Collateral.  This right and license
shall inure to the benefit of all successors, assigns and transferees of
Secured Party and its successors, assigns and transferees, whether by voluntary
conveyance, operation of law, assignment, transfer, foreclosure, deed in lieu
of foreclosure or otherwise.  Such right
and license is granted free of charge, without requirement that any monetary
payment whatsoever be made to Grantors.  SECTION 14.  Transfers
and Other Liens.  Neither Grantor shall:  (a)           sell, assign (by
operation of law or otherwise) or otherwise dispose of any of the Collateral,
except as permitted by the Indenture; or  (b)           except for the
security interest created by this Agreement or as permitted by the Credit
Agreement, create or suffer to exist any Lien upon or with respect to any of
the Collateral to secure the indebtedness or other obligations of any Person.  SECTION 15.  Secured
Party Appointed Attorney-in-Fact.  Each Grantor hereby
irrevocably appoints Secured Party as such Grantors attorney-in-fact, with
full authority in the place and stead of Grantor and in the name of such
Grantor, Secured Party or otherwise, from time to time, to do all acts and
things and to execute any instrument which Secured Party may deem necessary or
advisable to perfect and continue the perfection of the security interests created
by this Agreement and upon the occurrence and during the continuation of an
Event of Default, to take any other action not prohibited by the Indenture  16 
   and to execute any instrument
that Secured Party may deem necessary or advisable to accomplish the purposes
of this Agreement, including without limitation:  (a)           to obtain and adjust
insurance required to be maintained by such Grantor or paid to Secured Party
pursuant to Section 8;  (b)           to ask for, demand,
collect, sue for, recover, compound, receive and give acquittance and receipts
for moneys due and to become due under or in respect of any of the Collateral;  (c)           to receive, endorse
and collect any drafts or other instruments, documents and chattel paper in
connection with clauses (a) and (b) above;  (d)           to file any claims
or take any action or institute any proceedings (including, without limitation,
any proceeding before any Gaming Authority) that Secured Party may deem
necessary or desirable for the collection of any of the Collateral or otherwise
to enforce the rights of Secured Party with respect to any of the Collateral;  (e)           to pay or discharge
taxes or Liens (other than Liens permitted under this Agreement or the
Indenture) levied or placed upon or threatened against the Collateral, the
legality or validity thereof and the amounts necessary to discharge the same to
be determined by Secured Party in its sole discretion, any such payments made
by Secured Party to become obligations of Grantors to Secured Party, due and
payable immediately without demand;  (f)            to sign and endorse
any invoices, freight or express bills, bills of lading, storage or warehouse
receipts, drafts against debtors, assignments, verifications and notices in
connection with Accounts and other documents relating to the Collateral; and  (g)           subject to the terms
of the Intercreditor Agreement, generally to sell, transfer, pledge, make any
agreement with respect to or otherwise deal with any of the Collateral as fully
and completely as though Secured Party were the absolute owner thereof for all
purposes, and to do, at Secured Partys option and Grantors expense, at any
time or from time to time, all acts and things that Secured Party deems
necessary to protect, preserve or realize upon the Collateral and Secured
Partys security interest therein in order to effect the intent of this
Agreement, all as fully and effectively as such Grantor might do.  SECTION 16.  Secured
Party May Perform.  If either Grantor fails to perform any
agreement contained herein, Secured Party may itself perform, or cause
performance of, such agreement, and the expenses of Secured Party incurred in
connection therewith shall be payable by Grantors under Section 20.  Nothing contained herein shall obligate Secured
Party to take any such action.  SECTION 17.  Standard
of Care.  The powers conferred on Secured Party
hereunder are solely to protect its interest in the Collateral and shall not
impose any duty upon it to exercise any such powers.  Except for the exercise of reasonable care in the custody of  17 
   any Collateral in its
possession and the accounting for moneys actually received by it hereunder,
Secured Party shall have no duty as to any Collateral or as to the taking of
any necessary steps to preserve rights against any third parties or any other
rights pertaining to any Collateral. 
Secured Party shall be deemed to have exercised reasonable care in the
custody and preservation of Collateral in its possession if such Collateral is
accorded treatment substantially equal to that which Secured Party accords its
own property or similar property held in Secured Partys possession.  SECTION 18.  Remedies.  (a)           Notwithstanding any
other provision hereof, if Secured Party elects, upon any Event of Default, to
sell real property and any of the Collateral together under the Deed of Trust
and applicable law, then the terms of the Deed of Trust shall, with respect to
such sale and Collateral, control and supersede any terms in this Agreement
with respect to such sale and Collateral; provided that Secured Partys
election to exercise remedies under the Deed of Trust shall have no effect on
the terms contained in this Agreement with respect to any Collateral as to
which Secured Party has not so elected.  (b)           If any Event of
Default shall have occurred and be continuing Secured Party may, subject to the
terms of the Intercreditor Agreement, exercise in respect of the Collateral, in
addition to all other rights and remedies provided for herein or otherwise
available to it, all the rights and remedies of a secured party on default
under the Uniform Commercial Code as in effect in any relevant jurisdiction
(the Code) (whether or not the
Code applies to the affected Collateral), and also may (i) require
Grantors to, and Grantors hereby agree that they will at their expense and upon
request of Secured Party forthwith, assemble all or part of the Collateral as
directed by Secured Party and make it available to Secured Party at a place to
be designated by Secured Party that is reasonably convenient to both parties,
(ii) enter onto the property where any Collateral is located and take
possession thereof with or without judicial process, (iii) prior to the
disposition of the Collateral, store, process, repair or recondition the
Collateral or otherwise prepare the Collateral for disposition in any manner to
the extent Secured Party deems appropriate, (iv) take possession of
Grantors premises or place custodians in exclusive control thereof, remain on
such premises and use the same and any of Grantors equipment for the purpose
of completing any work in process, taking any actions described in the
preceding clause (iii) and collecting any Secured Obligation, and
(v) without notice except as specified below, sell the Collateral or any
part thereof in one or more parcels at public or private sale, at any of
Secured Partys offices or elsewhere, for cash, on credit or for future
delivery, at such time or times and at such price or prices and upon such other
terms as Secured Party may deem commercially reasonable.  Secured Party or any holder of Notes may be
the purchaser of any or all of the Collateral at any such sale and Secured
Party, shall be entitled, for the purpose of bidding and making settlement or
payment of the purchase price for all or any portion of the Collateral sold at
any such public sale, to use and apply any of the Secured Obligations as a
credit on account of the purchase price for any Collateral payable by Secured
Party at such sale.  Each purchaser at
any such sale shall hold the property sold absolutely free from any claim or
right on the part of Grantors, and Grantors hereby waive (to the extent
permitted by applicable law) all rights of  18 
   redemption, stay and/or
appraisal which they now have or may at any time in the future have under any
rule of law or statute now existing or hereafter enacted.  Each Grantor agrees that, to the extent
notice of sale shall be required by law, at least ten days notice to such
Grantor of the time and place of any public sale or the time after which any
private sale is to be made shall constitute reasonable notification.  Secured Party shall not be obligated to make
any sale of Collateral regardless of notice of sale having been given.  Secured Party may adjourn any public or
private sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the time and
place to which it was so adjourned. 
Each Grantor hereby waives any claims against Secured Party arising by
reason of the fact that the price at which any Collateral may have been sold at
such a private sale was less than the price which might have been obtained at a
public sale, even if Secured Party accepts the first offer received and does
not offer such Collateral to more than one offeree.  If the proceeds of any sale or other disposition of the
Collateral are insufficient to pay all the Secured Obligations, Grantors shall
be liable for the deficiency and the reasonable fees of any attorneys employed
by Secured Party to collect such deficiency.  Notwithstanding anything to the contrary contained herein, if, upon an
Event of Default hereunder or under the Indenture and foreclosure upon any
gaming permits pledged and assigned herein, Secured Party is not qualified
under the Gaming Laws to hold such gaming permits, then Secured Party shall
designate an appropriately qualified third party to which an assignment of such
gaming permits can be made in compliance with the Gaming Laws.  SECTION 19.  Application
of Proceeds.  Except as expressly provided elsewhere in
this Agreement, all proceeds received by Secured Party in respect of any sale
of, collection from, or other realization upon all or any part of the
Collateral may, in the discretion of Secured Party, be held by Secured Party as
Collateral for, and/or then, or at any other time thereafter, applied in full
or in part by Secured Party against, the Secured Obligations in the following
order of priority:  FIRST:  To the payment of all
reasonable costs and expenses of such sale, collection or other realization,
including costs and expenses of Secured Party and its agents and counsel, and
all other expenses, liabilities and advances made or incurred by Secured Party
in connection therewith, and all amounts for which Secured Party is entitled to
indemnification hereunder and all advances made by Secured Party hereunder for
the account of Grantor, and to the payment of all costs and expenses paid or
incurred by Secured Party in connection with the exercise of any right or
remedy hereunder, all in accordance with Section 20;  SECOND:  To the payment of all
other Secured Obligations (for the ratable benefit of the holders thereof) in
such order as Secured Party shall elect; and  THIRD:  To the payment to or
upon the order of Grantors, or to whomsoever may be lawfully entitled to
receive the same or as a court of competent jurisdiction may direct, of any
surplus then remaining from such proceeds.  19 
   SECTION 20.  Indemnity
and Expenses.  (a)           Each Grantor,
jointly and severally, agrees to indemnify Secured Party from and against any
and all claims, losses and liabilities in any way relating to, growing out of
or resulting from this Agreement and the transactions contemplated hereby
(including, without limitation, enforcement of this Agreement), except to the
extent such claims, losses or liabilities result solely from Secured Partys
gross negligence or willful misconduct as finally determined by a court of
competent jurisdiction.  (b)           Each Grantor,
jointly and severally, shall pay to Secured Party upon demand the amount of any
and all costs and expenses, including the reasonable fees and expenses of its
counsel and of any experts and agents, that Secured Party may incur in
connection with (i) the administration of this Agreement, (ii) the
custody, preservation, use or operation of, or the sale of, collection from, or
other realization upon, any of the Collateral, (iii) the exercise or
enforcement of any of the rights of Secured Party hereunder, or (iv) the
failure by either Grantor to perform or observe any of the provisions hereof.  SECTION 21.  Continuing
Security Interest; Successors and Assigns. 
This Agreement shall create a continuing security interest in the
Collateral and shall (a) remain in full force and effect until the
indefeasible payment in full of the Secured Obligations, (b) be binding
upon Grantors, their respective successors and assigns, and (c) inure,
together with the rights and remedies of Secured Party hereunder, to the
benefit of Secured Party and its successors, transferees and assigns. Upon the
indefeasible payment in full of all Secured Obligations, the security interest
granted hereby shall terminate and all rights to the Collateral shall revert to
Grantors.  Upon any such termination
Secured Party will, at Grantors expense, execute and deliver to Grantors such
documents as Grantors shall reasonably request to evidence such termination.  SECTION 22.  Definitions. 
Terms used herein without definitions shall have the meanings ascribed
thereto in the Indenture.  The following
terms used in this Agreement shall have the following meanings:  Circus Bridge means the elevated building structure that spans
Fifth Street and connects the Improvements with the buildings located on the
adjacent real property owned by Circus Circus Casinos, Inc, a Nevada
corporation which is a wholly owned Subsidiary of Mandalay.  Deed of Trust means the Deed of Trust, Fixture Filing With
Security Agreement and Assignment of Rents dated as of the date hereof executed
by the Partnership in favor of the Secured Party, as it may hereafter be
amended, supplemented or otherwise modified from time to time.  20 
   Eldorado Bridge means the elevated building structure that
spans Fourth Street and connects the Improvements with the buildings located on
the adjacent real property owned by Eldorado Resorts.  Eldorado LLC means Eldorado Limited Liability Company, a
Nevada limited liability company.  Eldorado Resorts means Eldorado Resorts, LLC, .a Nevada
limited liability company, and a member of Eldorado LLC.  Gaming Laws means all statutes, rules, regulations,
ordinances, codes and administrative or judicial precedents (including, without
limitation, the Nevada Gaming Control Act (N.R.S. Ch. 463)) pursuant to which
any Gaming Authority possesses regulatory, licensing or permit authority over
gambling, gaming or casino activities conducted by Partnership or its
subsidiaries within its jurisdiction.  Hotel means the Silver Legacy Hotel and Casino in Reno,
Nevada, including, without limitation, the Premises; the Improvements
(including, without limitation, the Silver Legacy Bridge and the Tunnel (as
defined below)); the Skyways, all street work; drainage; plantings;
signalization; and other installations, equipment and facilities located on or
off of the Premises and required of the Partnership by governmental authorities
in connection with development of the Premises.  Improvements means all buildings, structures, facilities and
other improvements of every kind and description now or hereafter located on
the Premises, including all parking areas, roads, driveways, walks, fences,
walls, beams, recreation facilities, drainage facilities, lighting facilities
and other site improvements, all water, sanitary and storm sewer, drainage,
electricity, steam, gas, telephone and other utility equipment and facilities,
all plumbing, lighting, heating, ventilating, air-conditioning, refrigeration,
incinerating, compacting, fire protection and sprinkler, surveillance and
security, vacuum cleaning, public address and communications equipment and
systems, all screens, awnings, floor coverings, partitions, elevators,
escalators, motors, machinery, pips, fittings and other items of equipment and
personal property of every kind and description now or hereafter located on the
Premises or attached to the improvements (excluding the Skyways but including
any support structures attached to the improvements with respect to the Skyways
and including the Silver Legacy Bridge and the Tunnel) that by the nature of
their location thereon or attachment thereto are real property under applicable
law.  Mandalay means Mandalay Resort Group, a Nevada corporation,
its successors and permitted assigns.  Material Adverse Effect means (i) a material adverse effect
upon (a) the business, operations, properties, assets, condition (financial or
otherwise) or prospects of the Partnership and its subsidiaries taken as a
whole, (b) the validity, priority or enforceability of any of the Indenture,
the Notes, the Collateral Documents or any Lien created or intended to  21 
   be created thereby, or (c) the
use, occupancy or operation of all or any material part of the Hotel or (ii)
the impairment of the ability of the Issuers and any Subsidiary Guarantor
materially to perform, or of Trustee or Noteholder to enforce the obligations
of the Issuers and Subsidiary Guarantors under the Indenture, the Notes and the
Subsidiary Guarantees.  Premises means the real property situated in Reno, Nevada, and
more particularly described in the Deed of Trust.  Skyway Easements means those two certain Bridge Easements
recorded in the Official Records of Washoe County, Nevada, one by and between
the Partnership and Eldorado Resorts and the other by and between the
Partnership and Circus Circus Casinos, Inc., pursuant to which, among other
things, Partnership was granted perpetual easements for pedestrian access to
and from the Improvements via the Eldorado Bridge and the Circus Bridge,
respectively.  Skyways means the Circus Circus Bridge and the Eldorado
Bridge; the Skyways are owned by Mandalay and Eldorado Resorts, respectively,
and are subject to the terms and provisions of the Skyway Easements.  The Skyways do not include the Silver Legacy
Bridge.  Tunnel means the tunnel beneath Sierra Street that connects
the casino portion of the Hotel to the hotel portion of the Hotel.  SECTION 23.  Secured
Party as Agent.  (a)           Secured Party shall
be obligated, and shall have the right hereunder, to make demands, to give
notices, to exercise or refrain from exercising any rights, and to take or
refrain from taking any action (including, without limitation, the release or
substitution of Collateral), solely in accordance with this Agreement and the
Indenture.  Notwithstanding any other
provisions hereof, Secured Party shall have no responsibility other than
pursuant to its obligations under the Indenture and the Trust Indenture Act of
1939, as amended, for filing financing statements, continuation statements, or
other documents, or taking any other action, to preserve any of the Collateral
or the validity, perfection, priority or enforceability of the security
interests granted hereby.  (b)           Secured Party shall
at all times be the same Person that is Trustee under the Indenture and shall
be entitled to all of the rights of Trustee specified in the Indenture,
including Section 7.02 thereof, in carrying out its duties hereunder.  Written notice of resignation by Trustee
pursuant to subsection 7.08 of the Indenture shall also constitute notice
of resignation as Secured Party under this Agreement; removal of Trustee
pursuant to subsection 7.08 of the Indenture shall also constitute removal
as Secured Party under this Agreement; and appointment of a successor Trustee
pursuant to subsection 7.08 of the Indenture shall also constitute appointment
of a successor Secured Party under this Agreement.  Upon the acceptance of any appointment as Trustee under
subsection 7.08 of the Indenture by a successor Trustee, that successor
Trustee shall thereupon succeed to and  22 
   become vested with all the
rights, powers, privileges and duties of the retiring or removed Secured Party
under this Agreement, and the retiring or removed Secured Party under this
Agreement shall promptly (i) transfer to such successor Secured Party all
sums, securities and other items of Collateral held hereunder, together with
all records and other documents necessary or appropriate in connection with the
performance of the duties of the successor Secured Party under this Agreement,
and (ii) execute and deliver to such successor Secured Party (at Grantors
expense) such amendments to financing statements, and take such other actions,
as may be necessary or appropriate in connection with the assignment to such
successor Secured Party of the security interests created hereunder, whereupon
such retiring, or removed Secured Party shall be discharged from its duties and
obligations under this Agreement.  After
any retiring or removed Trustees resignation or removal hereunder as Secured
Party, the provisions of this Agreement shall inure to its benefit as to any
actions taken or omitted to be taken by it under this Agreement while it was
Secured Party hereunder.  SECTION 24.  Amendments;
Etc.  No amendment or waiver of any provision of
this Agreement, or consent to any departure by either Grantor herefrom, shall
in any event be effective unless the same shall be in writing and signed by
Secured Party and Grantor, and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which it was
given.  SECTION 25. Notices.  Any
notice or other communication herein required or permitted to be given shall be
in writing and may be personally served, telexed or sent by telefacsimile or
United States mail or courier service and shall be deemed to have been given
when delivered in person or by courier service, upon receipt of telefacsimile
or telex prior to 5:00 p.m. on a Business Day, or three Business Days
after depositing it in the United States mail with postage prepaid and properly
addressed; provided that notices to Secured Party shall only be
effective upon receipt.  For the
purposes hereof, the address of each party hereto shall be as set forth under
such partys name on the signature pages hereof or, as to either party, such
other address as shall be designated by such party in a written notice
delivered to the other party hereto.  SECTION 26.  Failure
or Indulgence Not Waiver; Remedies Cumulative.  No
failure or delay on the part of Secured Party in the exercise of any power,
right or privilege hereunder shall impair such power, right or privilege or be
construed to he a waiver of any default or acquiescence therein. nor shall any
single or partial exercise of any such power, right or privilege preclude any
other or further exercise thereof or of any other power, right or
privilege.  All rights and remedies
existing under this Agreement are cumulative to, and not exclusive of, any
rights or remedies otherwise available.  SECTION 27.  Severability.  In
case any provision in or obligation under this Agreement shall be invalid,
illegal or unenforceable in any jurisdiction, the validity, legality and
enforceability of the remaining provisions or obligations, or of such provision
or obligation in any other jurisdiction, shall not in any way be affected or
impaired thereby.  23 
   SECTION 28.  Headings. 
Section and subsection headings in this Agreement are included herein
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.  SECTION 29.  GOVERNING
LAW; TERMS.  THIS
AGREEMENT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEVADA, WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES. 
Terms defined in Articles 8 and 9 of the Uniform Commercial
Code as in effect from time to time in the State of Nevada shall, unless
otherwise defined herein, have the meanings set forth in such Articles 8
and 9 of the Uniform Commercial Code.  SECTION 30.  Consent
to Jurisdiction and Service of Process.  ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST EITHER
GRANTORS ARISING OUT OF OR RELATING TO THIS AGREEMENT MAY BE BROUGHT IN ANY
STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE OF NEVADA, AND BY
EXECUTION AND DELIVERY OF THIS AGREEMENT EACH GRANTOR ACCEPTS FOR ITSELF AND IN
CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE EXCLUSIVE
JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON
CONVENIENS AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY
IN CONNECTION WITH THIS AGREEMENT. 
Each Grantor hereby agrees that service of all process in any such
proceeding in any such court may be made by registered or certified mail,
return receipt requested, to such Grantor at its address provided in
Section 24, such service being hereby acknowledged by such Grantor to be
sufficient for personal jurisdiction in any action against such Grantor in any
such court and to be otherwise effective and binding service in every
respect.  Nothing herein shall affect
the right to serve process in any other manner permitted by law.  SECTION 31.  Waiver
of Jury Trial.  EACH
GRANTOR AND SECURED PARTY HEREBY AGREE TO WAIVE THEIR RESPECTIVE RIGHTS TO A
JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
AGREEMENT.  The scope of this
waiver is intended to be all-encompassing of any and all disputes that may be
filed in any court and that relate to the subject matter of this transaction,
including without limitation contract claims, tort claims, breach of duty
claims, and all other common law and statutory claims.  Grantors and Secured Party each acknowledge
that this waiver is a material inducement for Grantors and Secured Party to
enter into a business relationship, that Grantors and Secured Party have
already relied on this waiver in entering into this Agreement and that each
will continue to rely on this waiver in their related future dealings.  Grantors and Secured Party further warrant
and represent that each has reviewed this waiver with its legal counsel, and
that each knowingly and voluntarily waives its jury trial rights following
consultation with legal counsel.  THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE
MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY  24 
   SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.  In the event of litigation, this Agreement
may be filed as a written consent to a trial by the court.  SECTION 32.  Financing
Statement Property Description.  To perfect the security
interests granted under this Agreement, Grantors expressly authorize Secured
Party to file financing statements naming each Grantor as debtor with the
Collateral Description all assets of the debtor, all personal property of
the debtor or words to that effect.  SECTION 33.  Release. Upon any sale, lease, transfer or other
disposition of any item of Collateral provided such transaction is not
prohibited under the terms of the Indenture, Secured Party will, at Grantors
expense, execute and deliver to Grantors such documents as Grantors may
reasonably request to release such item of Collateral from the security
interest granted hereby provided (i) at the time of such request an Event of
Default shall not have occurred and be continuing ,(ii) Grantors shall have
provided Secured Party at least ten business days prior to the proposed release
date a written request for release describing the item of Collateral and the
material terms of the sale together with the form of release and a certificate
of an officer of each Grantor certifying such transaction is in accordance with
and is permitted under the Indenture and (iii) the proceeds of any such
transaction shall be applied in accordance with the provisions of the
Indenture.  SECTION 34.  Intercreditor
Agreement.In the
event of any conflict or inconsistency between this Agreement and the Intercreditor
Agreement the provisions of the Intercreditor Agreement shall control.  SECTION 35.  Counterparts. 
This Agreement may be executed in one or more counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document.  25 
   IN WITNESS WHEREOF, Grantors and Secured Party have caused this
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.  CIRCUS AND ELDORADO JOINT VENTURE,a Nevada
  general partnershipBy:
  /s/Bruce
  SextonBruce
  SextonChief
  Accounting and Financial OfficerNotice
  Address:
  c/o
  Circus and Eldroado Joint Venture407
  North Virginia StreetReno,
  Nevada 89501Attn:  Bruce SextonSILVER LEGACY CAPITAL CORP.,A
  Nevada corporationBy:
  /s/Bruce
  SextonBruce
  SextonChief
  Accounting and Financial OfficerNotice
  Address:
  c/o
  Circus and Eldroado Joint Venture407
  North Virginia StreetReno,
  Nevada 89501Attn:  Bruce Sexton  26 
   SCHEDULE I TO SECURITY AGREEMENT  Assigned Agreements  1Contract for Construction, dated as of
February 7, 1994, by and between Perini Building Company and Circus and
Eldorado Joint Venture as amended by Change Order Nos. 1-10, as amended,
supplemented or otherwise modified from time to time.  2Agreement Between Owner and Architect, dated
as of February 1994, by and between Mitchell Cohen Architects, Inc. and Circus
and Eldorado Joint Venture, as assigned to Urban Design Group, P.C. pursuant to
that undated Assignment by and among Circus and Eldorado Joint Venture,
Mitchell Cohan Architects, Inc.. UDG, Inc. d/b/a Urban Design Group, Inc. and
Urban Design Group, P.C. as it may be amended, supplemented or otherwise
modified from time to time.  3Letter agreement, dated November 18,
1993, by and between Smith-Casino Advisory and Circus and Eldorado Joint
Venture as amended by Addendum One to Letter Agreement for Project C dated
as of January 24, 1995, as amended by Addendum Two to Letter Agreement for
Silver Legacy dated as of March 10, 1995, as it may be amended, supplemented
or otherwise modified from time to time.  27 
   SCHEDULE II TO SECURITY AGREEMENT  Locations of Equipment:  407 North Virginia Street, Reno, Nevada 89501  1975 Timber Way, Reno, Nevada 89512  50 East 4th Street, Reno, Nevada 89501  Locations of Inventory:  407 North Virginia Street, Reno, Nevada 89501  1975 Timber Way, Reno, Nevada 89512  50 East 4th Street, Reno, Nevada 89501  28