===========================================================
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

                        FOR ANNUAL AND TRANSITION REPORTS
                     PURSUANT TO SECTIONS 13 OR 15(d) OF THE
                          SECURITIES EXCHANGE ACT OF 1934

The Registrant meets the conditions set forth in General Instruction I (1)

(a) and (b) of Form 10-K and is  therefore  filing  this  Form with the  reduced
disclosure format.

    (Mark One)
[X] Annual report pursuant to section 13 or 15(d) of the Securities Exchange Act
of 1934 [No Fee Required] For the fiscal year ended December 31, 2001.

[ ]  Transition  report  pursuant  to  sections  13 or 15(d)  of the  Securities
Exchange Act of 1934 [Fee Required] For the transition period from __________ to
__________

                        Commission file number 333-8163

                            RIVIERA BLACK HAWK, INC.
             (Exact name of Registrant as specified in its charter)

           Colorado                                            88-0886265
--------------------------------                     ---------------------------
(State of Incorporation)                               (IRS. Employer ID Number)

2901 Las Vegas Boulevard South
Las Vegas, Nevada                                                 89109
-------------------------------------------------             -----------
(Address of principal executive offices)                      (Zip Code)

Registrant's telephone number, including area code:  (702) 794-9527
                                                     --------------

Securities registered pursuant to Section 12(b) of the Act:  None
                                                             ----

Securities registered pursuant to Section 12(g) of the Act:  None
                                                             ----

           Indicate  by check  mark  whether  the  Registrant  (1) has filed all
reports  required to be filed by Section 13 or 15(d) of the Securities  Exchange
Act of 1934 during the preceding 12 months (or for such shorter  period that the
Registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.
YES   X    NO
    -----     ------

         Indicate by check mark if disclosure of delinquent  filers  pursuant to
Item 405 of Regulation S-K is not contained  herein,  and will not be contained,
to the best of  Registrant's  knowledge,  in  definitive  proxy  or  information
statements  incorporated by reference in Part III of this Form 10-K or amendment
to this Form 10-K.

         The Registrant's  Common Stock is owned 100% indirectly by its ultimate
parent Riviera Holdings  Corporation,  a reporting company. As of March 16, 2002
the number of outstanding shares of the Registrant's Common Stock was 1,000.

Documents incorporated by reference:

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                               Page 1 of 23 Pages
                    Exhibit Index Appears on Page 22 hereof.


<PAGE>
<TABLE>
<CAPTION>


                            RIVIERA BLACK HAWK, INC.
                    ANNUAL REPORT ON FORM 10-K FOR THE FISCAL
                          YEAR ENDED DECEMBER 31, 2001

                                TABLE OF CONTENTS



<S>          <C>                                                                                                 <C>
Item 1.    Business...............................................................................................3
           General................................................................................................3
           The Riviera Black Hawk Casino..........................................................................3
           Geographical Markets...................................................................................4
           Competition............................................................................................5
           Employees and Labor Relations..........................................................................6
           Regulation and Licensing...............................................................................6
           Federal Registration..................................................................................11

Item 2.    Property..............................................................................................11

Item 3.    Legal Proceedings.....................................................................................11

Item 4.    Submission of Matters to a Vote of Security Holders...................................................11

Item 5.    Market for the Registrant's Common Stock and Related Security Holder Matters..........................12

Item 6.    Selected Financial Data...............................................................................12

Item 7.    Management's Discussion and Analysis of Financial Condition and Results of Operations.................12
           Results of Operations.................................................................................12
           Liquidity and Capital Resources.......................................................................15
           Recently Adopted Accounting Standards.................................................................16
           Recently Issued Accounting Standards..................................................................16
           Forward Looking Statements............................................................................18

Item 7a.   Quantitative and Qualitative Market Risk Disclosure...................................................18

Item 8.    Financial Statements .................................................................................19

Item 9.    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure..................19

Item 10.   Directors and Executive Officers of the Registrant (not applicable....................................19

Item 11.   Executive Compensation (not applicable)...............................................................19

Item 12.   Security Ownership of certain Beneficial Owners and Management (not applicable).......................19

Item 13.   Certain Relationships and Related Transactions .......................................................19

Item 14.   Exhibits, Financial Statement Schedules and Reports on Form 8K........................................19
</TABLE>


                                                2
<PAGE>


         PART I

General

         Riviera Black Hawk, Inc., a Colorado corporation,  was formed on August
18,  1997  and is  wholly-owned  by  Riviera  Operating  Corporation,  a  Nevada
corporation,  which is, in turn, wholly-owned by Riviera Holdings Corporation, a
Nevada  corporation.  Riviera  Holdings  Corporation,  through its  wholly-owned
subsidiary,  Riviera Operating  Corporation,  also owns and operates the Riviera
Hotel &  Casino  ("Riviera  Las  Vegas")  located  on  "The  Strip,"  Las  Vegas
Boulevard, in Las Vegas, Nevada. Opened in 1955, Riviera Las Vegas has developed
a  long-standing  reputation  for  delivering  high  quality,   traditional  Las
Vegas-style gaming, entertainment and other amenities.

         The Riviera Black Hawk Casino  (Riviera  Black Hawk) opened on February
4, 2000. Located in Black Hawk, Colorado, approximately forty (40) miles west of
Denver,  our casino is one of the first three  encountered  when  traveling from
Denver to the  adjacent  gaming  cities of Black Hawk and  Central  City.  It is
located on the  corner of Mill and Main  Streets,  across  from both the Isle of
Capri casino and the Colorado Central Station casino.  Riviera Black Hawk offers
parking for 520 vehicles,  of which ninety-two  percent (92%) are covered,  with
convenient and free self-park and valet options.

Gaming

         Our casino  features the fourth largest number of gaming devices in the
Black Hawk / Central City market with 986 slot machines and 12 blackjack tables.
In Colorado,  each slot machine  and each table  game is  considered one  gaming
device.

Restaurants

         The  quality,  value  and  variety  of  food  served  are  critical  to
attracting Black Hawk visitors.  Riviera Black Hawk offers two restaurants,  the
World's Fare Buffet,  a casual  buffet  style  restaurant  located on the second
floor of the  facility  with a seating  capacity of up to 252 people and a Pizza
Hut. In  addition  to the  restaurant,  our casino also includes  two bars,  one
located in the  entertainment  area and the other one on the casino floor.

Entertainment

         Riviera   Black  Hawk   includes  a  7,000   square   feet,   multi-use
entertainment  center  located  on the  second  level of the  facility  with the
capacity to seat approximately 440 people. This is one of the largest facilities
in the Black Hawk market enabling us to feature  entertainment  performances and
special  events.  When not in use, the  entertainment  center is  available  for
meetings, parties and other promotional events.

Marketing Strategy

           The initial  participants  in this market were small,  privately held
gaming  facilities whose inability to offer convenient  parking and a full range
of traditional casino amenities limited the growth of this market. Subsequently,
larger  casinos  offering such  amenities  have entered the market and have been
gaining  market  share,  contributing  to the  consistent  growth in the overall
market. As of December 31, 2001, there were 25 casinos in the Black Hawk market,
with eleven casinos each offering more than 400 gaming  devices.  Isle of Capri,
located  across  the street  from our casino  with  approximately  1,145  gaming
machines and 1,000 covered parking  spaces,  has been the market leader in terms
of win per gaming  device.  The Hyatt Casino with 1,332  gaming  machines and 22
table games opened on December 20, 2001.


                                                3
<PAGE>

           We  attract  customers  to  our  casino  by  implementing   marketing
strategies and promotions designed specifically for this market. In so doing, we
hope to create customer loyalty and benefit from repeat visits by our customers.
Specific  marketing  programs to support this strategy include the Riviera Black
Hawk Player's Club and "Elite" services offered to repeat gaming customers.  The
Riviera  Black Hawk Player's  Club is a promotion  that rewards  casino play and
repeat visits to the casino with various  privileges  and amenities such as cash
bonuses,  logo gift  items and  invitations to special  events, such as parties,
professional sporting  events and concerts. "Elite" services  are  available  to
the highest  level  of  players  and  include  special  valet  and  self-parking
services,  complimentary  food  and entertainment  offerings and  special events
specifically designed for this group of customers.

           We benefit from strong "walk-in"  traffic due to the proximity of our
casino to the Colorado Central Station and the Isle of Capri Casino. We have and
continue  to develop  specific  marketing  programs  designed  to attract  these
"walk-in"  customers.  We emphasize  quality food and  beverage  amenities  with
customer  friendly  service  as  a  marketing  tool.  In  addition,  we  provide
entertainment  programs  designed  to meet the tastes of the Black  Hawk/Central
City market,  such as live music  performances by popular  regional and national
groups, comedians and boxing.

           We rely on  database  marketing  in  order  to best  identify  target
customer  segments of the population  and to tailor the casino's  promotions and
amenities  to our core  group  of  customers.  We use the  current  database  to
identify and stratify slot players living  primarily in Colorado for appropriate
incentives.  Approximately 150,000 of these slot players have been identified as
of December  31,  2001.  In addition,  we promote our casino by  advertising  in
newspapers, on billboards and on the radio in the local areas.

Geographical Markets

The Black Hawk Market

         Gaming was first  introduced to the Black  Hawk/Central  City market in
October 1991 following a state-wide  referendum  where Colorado  voters approved
limited stakes gaming for three historic mining towns - Black Hawk, Central City
and Cripple  Creek.  Limited stakes gaming is defined as a maximum single bet of
$5. Black Hawk and Central City are contiguous  cities located  approximately 40
miles west of Denver and about ten miles  north of  Interstate  Highway  70, the
main  east-west  artery  from  Denver.  Historically,   these  two  gold  mining
communities were popular tourist towns.  However,  since the inception of casino
gaming in October 1991, many of the former tourist-related  businesses have been
displaced by gaming establishments.

         The first  casino in the Black  Hawk/Central  City market was opened in
October 1991 with 14 casinos open by the end of that year. The pace of expansion
increased further in 1992 with the number of casinos in the market peaking at 42
casinos.  However,  due to a  trend  of  consolidation  in the  market  and  the
displacement  of small  casinos  by the  entry  of  larger,  better  capitalized
operators, the number of casinos has declined to 25 as of December 31, 2001.

         The Black  Hawk/Central  City  market  primarily  caters to  "day-trip"
customers  from  Denver,  Boulder,  Fort Collins and Golden as well as Cheyenne,
Wyoming.  We believe an estimated adult population  exceeding 2.4 million people
resides within this 100-mile radius of Black Hawk. In addition,  we believe that
residents  within a 100-mile  radius of the City of Black Hawk had an  estimated
average household income in excess of $50,000 per annum in 2001.

Since 1992, the number of gaming devices in the Black  Hawk/Central  City market
has grown  approximately  78% from 7,252  devices  in 1992 to 12,907  devices in
2001.  Win per gaming  device per day has continued to grow despite the increase
in the number of gaming devices.  Gaming revenues in the Black Hawk/Central City


                                                4
<PAGE>

market grew by 8.2% in 2001 over 2000. The City of Black Hawk itself experienced
a 10.3% increase in gaming revenue in 2001.

           The City of Black Hawk has  experienced  more  significant  growth in
gaming  revenues than Central City since 1992.  The  popularity of Black Hawk in
comparison to Central City is due primarily to Black Hawk's  superior  access to
major highways,  as patrons must first pass through Black Hawk to access Central
City from Denver.  Due to this superior  location,  larger casino operators have
focused on  building in the City of Black  Hawk.  As a result,  casinos in Black
Hawk now generally  feature a larger average number of gaming  devices,  a wider
variety of amenities and convenient free parking for patrons. These factors have
contributed to growth in Black Hawk gaming  revenues of 783% since 1992 compared
to a negative growth for Central City of 16% over the same period. The number of
gaming  devices in the City of Black Hawk has increased  242% since 1992,  while
the  number of gaming  devices in Central  City has  declined  43% over the same
period.

Competition

The  Black   Hawk/Central   City  gaming  market  is  characterized  by  intense
competition.  The  primary  competitive  factors  in the  market  are  location,
availability  and  convenience  of parking,  number of slot  machines and gaming
tables,  promotional  incentives,  hotel rooms,  types and pricing of non-gaming
amenities, name recognition and overall atmosphere. Our main competitors are the
larger gaming facilities, particularly those with considerable on-site or nearby
parking and established reputations in the local market. As of December 31, 2001
there were 25 gaming  facilities  in the Black Hawk / Central City  market  with
11 casinos  each  offering  more  than  400 gaming positions.  The Hyatt Casino,
which features 1,335 slot machines, opened on December 20, 2001.  Other projects
have also been announced,  proposed,  discussed  or rumored  for the Black Hawk/
Central City market.

           The gaming  facilities near the intersection of Main and Mill Streets
provide significant  competition to our casino.  Colorado Central Station, which
has been one of the most successful  casinos in Colorado,  is located across the
street from our casino and has approximately 700 slot machines, 20 gaming tables
and approximately 700 valet parking spaces.  The Isle of Capri Casino,  the most
successful  casino in  Colorado, which  opened  in  December  1998,  is  located
directly  across  the  street  from our casino and features approximately  1,145
slot  machines,  14 table  games,  1,000  parking spaces, and 235 hotel rooms.

           The number of hotel rooms  currently in the Black  Hawk/Central  City
market is approximately  450, with only three gaming facilities  providing hotel
accommodations to patrons.  These include Harvey's Wagon Wheel Casino Hotel with
approximately 120 rooms, the Lodge at Black Hawk with approximately 50 rooms and
the Isle of Capri Casino with 235 rooms.  Casinos offering hotel  accommodations
for overnight stay may have a competitive advantage over our casino. However, we
believe that self-parking is a more effective utilization of our available space
and that providing hotel  accommodations  will not be a significant  factor, but
instead will contribute to growth in the overall market.

           Historically,  the city of Black Hawk has enjoyed an  advantage  over
Central City because customers have to drive through Black Hawk to reach Central
City.  Central City has received approval for the development of a road directly
connecting  Central  City and Black Hawk with  Interstate  70, which would allow
customers to reach Central City without driving by or through Black Hawk.  There
remain significant financial obstacles to the development of this road and it is
uncertain  whether it will be developed over the near to  intermediate  term, or
developed at all.

           Currently,  limited  stakes  gaming in Colorado  is  constitutionally
authorized in Central City,  Black Hawk,  Cripple Creek and two Native  American
reservations in southwest Colorado.  However,  gaming could be approved in other
Colorado  communities in the future. The legalization of gaming closer to Denver
would likely have a material adverse effect on our future results of operations.
We also  compete  with  other  forms of gaming in  Colorado,  including  lottery
gaming, and horse and dog racing as well as other forms of entertainment.


                                                5
<PAGE>

           It is also  possible  that new forms of gaming could compete with our
casino.  Currently,  Colorado law does not authorize  video  lottery  terminals.
However,  Colorado law permits the  legislature,  with  executive  approval,  to
authorize new types of lottery gaming,  such as video lottery  terminals.  Video
lottery  terminals are games of chance,  similar to slot machines,  in which the
player  pushes a button that causes a random set of numbers or  characters to be
displayed on a video  screen.  The player may be awarded a ticket,  which can be
exchanged  for cash or credit play.  This form of gaming could compete with slot
machine gaming.

           Pursuant to a license  agreement,  Riviera Las Vegas licenses the use
at the Black Hawk casino of all of the trademarks,  service marks and logos used
by  Riviera  Las  Vegas.  In  addition,  the  license  agreement  provides  that
additional  trademarks,  service marks and logos acquired or developed by us and
used at our other facilities will be subject to the license agreement.


Employees and Labor Relations

         Riviera  Black Hawk opened on February 4, 2000 with  approximately  450
full time equivalent employees.  As of  December 31, 2001,  the  total number of
full time equivalent employees was 371. The Black Hawk/Central City labor market
is  very  competitive.  Riviera  Black  Hawk  believes  that  it will be able to
maintain its current employee level.  There  can be no assurance,  however, that
new  and  existing  casinos  will  not affect  Riviera  Black  Hawk's ability to
maintain its current employee level.

         There are currently no collective  bargaining  agreements in Black Hawk
casinos.

Regulation and Licensing

Colorado Gaming and Liquor Regulation

Summary


         In general we, Riviera Black Hawk, our principal executive officers and
those of Riviera  Holdings,  and any of our  employees  who are  involved in our
gaming  operations,  are  required to be found  suitable  for  licensure  by the
Colorado Gaming Commission. Colorado also requires that significant stockholders
of 5% or more of our stock be certified as suitable for licensure. Riviera Black
Hawk's  original  retail  gaming  license was  approved by the  Colorado  Gaming
Commission  on  November  18,  1999,  and has  been  successfully  renewed  each
subsequent year.

Background

           Pursuant to an amendment to the Colorado Constitution, limited stakes
gaming became lawful in the cities of Central City, Black Hawk and Cripple Creek
on October 1, 1991.  Limited  stakes  gaming means a maximum  single bet of five
dollars on slot machines and in the card games of blackjack and poker.

           Limited  stakes  gaming is confined to the  commercial  districts  of
these cities as defined by Central City on October 7, 1981, by Black Hawk on May
4, 1978,  and by Cripple  Creek on December 3, 1973.  In addition,  the Colorado
Amendment  restricts  limited  stakes gaming to  structures  that conform to the
architectural  styles and  designs  that were common to the areas prior to World
War I, and which  conform to the  requirements  of  applicable  city  ordinances
regardless of the age of the structures.  Under the Colorado Amendment,  no more
than 35% of the square  footage of any  building and no more than 50% of any one
floor of any building may be used for limited stakes  gaming.  Persons under the


                                                6
<PAGE>

age of 21 cannot  participate in limited stakes gaming.  The Colorado  Amendment
also  prohibits  limited  stakes gaming  between the hours of 2:00 a.m. and 8:00
a.m., and allows limited  stakes gaming to occur in  establishments  licensed to
sell alcoholic beverages.

           Further,  the Colorado Act  provides  that,  in addition to any other
applicable  license fees,  up to a maximum of 40% of the total  amounts  wagered
less  payouts to players  may be payable  by a  licensee  for the  privilege  of
conducting  limited stakes gaming.  Such  percentage is to be established by the
Colorado Commission annually.

           The Colorado Act declares  public policy on limited  stakes gaming to
be that:  (1) the  success of limited  stakes  gaming is  dependent  upon public
confidence and trust that licensed  limited stakes gaming is conducted  honestly
and  competitively;  the rights of the  creditors  of licensees  are  protected;
gaming is free from criminal and corruptive elements;  (2) public confidence and
trust can be maintained  only by strict  regulation  of all persons,  locations,
practices,  associations  and  activities  related to the  operation of licensed
gaming  establishments and the manufacture or distribution of gaming devices and
equipment;  (3) all  establishments  where limited gaming is conducted and where
gambling devices are operated,  and all manufacturers,  sellers and distributors
of certain gambling devices and equipment must therefore be licensed, controlled
and assisted to protect the public  health,  safety,  good order and the general
welfare of the  inhabitants  of the state to foster the stability and success of
limited stakes gaming and to preserve the economy, policies and free competition
in Colorado;  and (4) no applicant for a license or other affirmative commission
approval has any right to a license or to the  granting of the approval  sought.
Any  license  issued  or  other  commission  approval  granted  pursuant  to the
provisions of this Article is a revocable privilege,  and no holder acquires any
vested rights therein.

Regulatory Structure

           The  Colorado Act subjects  the  ownership  and  operation of limited
stakes gaming  facilities in Colorado to extensive  licensing and  regulation by
the  Colorado  Commission.  The  Colorado  Commission  has  full  and  exclusive
authority to promulgate,  and has promulgated,  rules and regulations  governing
the licensing,  conducting and operating of limited stakes gaming.  The Colorado
Act also created the  Colorado  Division of Gaming  within the Colorado  Revenue
Department  to license,  regulate and  supervise  the conduct of limited  stakes
gaming in Colorado.  The division is supervised and administered by the Director
of the Division of Gaming.

Gaming licenses

The Colorado Commission may issue:

     o slot machine manufacturer or distributor,

     o operator,

     o retail gaming,

     o support, and

     o key employee gaming licenses.

           The first  three  licenses  require  annual  renewal by the  Colorado
Commission.  Support and key employee  licenses are issued for two-year  periods
and are renewable by the Division  Director.  The Colorado  Commission has broad
discretion to condition, suspend for up to six months, revoke, limit or restrict
a license at any time and also has the authority to impose fines.

                                                7
<PAGE>

           An  applicant  for  a  gaming  license  must  complete  comprehensive
application forms, pay required fees and provide all information required by the
Colorado Commission and the Division of Gaming.  Prior to licensure,  applicants
must satisfy the  Colorado  Commission  that they are  suitable  for  licensing.
Applicants have the burden of proving their qualifications and must pay the full
cost of any  background  investigations.  There  is no limit on the cost of such
background investigations.

           Gaming employees must hold either a support or key employee  license.
Every retail gaming licensee must have a key employee  licensee in charge of all
limited stakes gaming  activities when limited stakes gaming is being conducted.
The Colorado  Commission may determine that a gaming  employee is a key employee
and, require that such person apply for a key employee license.

           A retail  gaming  license  is  required  for all  persons  conducting
limited stakes gaming on their  premises.  In addition,  an operator  license is
required  for all  persons who engage in the  business of placing and  operating
slot machines on the premises of a retailer. However, a retailer is not required
to hold an operator  license.  No person may have an ownership  interest in more
than three retail gaming  licenses.  A slot machine  manufacturer or distributor
license is required for all persons who manufacture,  import and distribute slot
machines in Colorado.

           The Colorado  Regulations require that every officer,  director,  and
stockholder of private  corporations or equivalent  office or ownership  holders
for non-corporate applicants, and every officer, director or stockholder holding
either a 5% or greater  interest or  controlling  interest of a publicly  traded
corporation  or owners of an  applicant  or  licensee  shall be a person of good
moral character and submit to a full background  investigation  conducted by the
Division of Gaming and the  Colorado  Commission.  The Colorado  Commission  may
require any person having an interest in a license to undergo a full  background
investigation  and pay the  cost  of  investigation  in the  same  manner  as an
applicant.

           Persons found  unsuitable by the Colorado  Commission may be required
immediately  to  terminate  any  interest,  association,  or  agreement  with or
relationship  to a  licensee.  A finding of  unsuitability  with  respect to any
officer, director, employee, associate, lender or beneficial owner of a licensee
or applicant  also may  jeopardize  the  licensee's  license or the  applicant's
application.  A license  approval may be conditioned upon the termination of any
relationship with unsuitable  persons.  A person may be found unsuitable because
of prior acts,  associations or financial conditions.  Acts that would lead to a
finding of  unsuitability  are those that would  violate the Colorado Act or the
Colorado  Regulations or that contravene the legislative purpose of the Colorado
Act.

Duties of licensees

           An  applicant  or licensee  must report to the  Division of Gaming or
Colorado  Commission  all leases not later than 30 days after the effective date
of the lease. Also, an applicant or a licensee, upon the request of the Colorado
Commission or the Division  Director,  must submit copies of all written  gaming
contracts and  summaries of all oral gaming  contracts to which it is or intends
to become a party. The Division Director or the Colorado  Commission may require
changes in the lease or gaming  contract  before an  applicant  is  approved  or
participation  in such  agreement is allowed or may require  termination  of the
lease or gaming contract.

           The Colorado Act and the Colorado  Regulations  require  licensees to
maintain  detailed records that account for all business  transactions.  Records
must be furnished upon demand to the Colorado Commission, the Division of Gaming
and other law enforcement  authorities.  The Colorado Regulations also establish
extensive  playing  procedures  and rules of play for poker,  blackjack and slot
machines.  Retail gaming  licenses  must adopt  comprehensive  internal  control
procedures.  Such  procedures  must be  approved  in advance by the  Division of
Gaming and  include the areas of  accounting,  surveillance,  security,  cashier
operations,  key control and fill and drop procedures,  among others.  No gaming
devices  may be used in  limited  stakes  gaming  without  the  approval  of the
Division Director or the Colorado Commission.

           Licensees  have  a  continuing  duty  to  immediately  report  to the
Division  of Gaming the name,  date of birth and social  security  number of all
persons who obtain an ownership, financial or equity interest in the licensee of


                                                8
<PAGE>

5% or  greater,  who have the  ability to  control  the  licensee,  who have the
ability to  exercise  significant  influence  over the  licensee or who loan any
money or other  thing of value to the  licensee.  Licensees  must  report to the
Division  of  Gaming  all  gaming  licenses,  and all  applications  for  gaming
licenses, in foreign jurisdictions.

           With limited  exceptions  applicable  to licensees  that are publicly
traded  entities,  no person may sell,  lease,  purchase,  convey or acquire any
interest in a retail  gaming or operator  license or business  without the prior
approval of the Colorado Commission.

           All agreements,  contracts,  leases,  or arrangements in violation of
the Colorado  Amendment,  the Colorado Act or the Colorado  Regulations are void
and unenforceable.

Taxes, fees and fines

           The  Colorado  Amendment  requires  an annual tax of up to 40% on the
total  amount  wagered  less all  payouts to players.  With  respect to games of
poker, the tax is calculated based on the sums wagered which are retained by the
licensee as  compensation.  Annually  during April,  May and June,  the Colorado
Commission,  as mandated by the Colorado Regulations,  shall conduct rule-making
hearings  concerning  the gaming tax rate and device fee rate for the subsequent
gaming year.  However,  rigid  compliance  with the Colorado  Regulations is not
mandatory  and shall in no way be construed to limit the time periods or subject
matters which the Colorado  Commission may consider in  determining  the various
tax rates. Currently, the gaming tax is:

    o  .25% on the first $2 million of these amounts;

    o   2% on amounts from $2 million to $4 million;

    o   4% on amounts from $4 million to $5 million;

    o   11% on amounts from $5 million to $10 million;

    o   16% on amounts from $10 million to $15 million; and

    o   20% on amounts over $15 million.

           The Colorado  Commission  has  eliminated  the annual  device fee for
gaming device machines, blackjack tables and poker tables.

           The  municipality  of Black  Hawk  assesses  an annual  device fee of
$62.50 per device on all devices  exceeding  50. There is no statutory  limit on
state or city device  fees,  which may be  increased  at the  discretion  of the
Colorado Commission or the city. In addition,  a business  improvement fee of as
much as $7.42 per device and a monthly  transportation  authority  device fee of
$8.84 per device also may apply  depending  upon the  location  of the  licensed
premises in Black Hawk.

           Black  Hawk  also  imposes  taxes  and fees on other  aspects  of the
businesses of gaming licensees, such as parking, alcoholic beverage licenses and
other municipal taxes and fees.  Significant  increases in these fees and taxes,
or the imposition of new taxes and fees, may occur.

           Violation  of the  Colorado  Gaming Act or the  Colorado  Regulations
constitutes  a class 1  misdemeanor  which may subject the  violator to fines or
incarceration  or both.  A licensee  who  violates  the  Colorado  Gaming Act or
Colorado  Regulations is subject to suspension of the license for a period of up
to six months, fines or both, or to license revocation.


                                                9
<PAGE>

Requirements for publicly traded corporations

           The  Colorado   Commission   has  enacted  Rule  4.5,  which  imposes
requirements on publicly traded corporations holding gaming licenses in Colorado
and on gaming  licenses  owned  directly  or  indirectly  by a  publicly  traded
corporation,  whether  through a subsidiary or  intermediary  company.  The term
"publicly traded corporation"  includes  corporations,  firms, limited liability
companies, trusts, partnerships and other forms of business organizations.  Such
requirements  automatically  apply to any ownership  interest held by a publicly
traded corporation,  holding company or intermediary company thereof,  where the
ownership  interest  directly or indirectly  is, or will be upon approval of the
Colorado  Commission,  5% or more of the entire  licensee.  In any event, if the
Colorado  Commission  determines  that  a  publicly  traded  corporation,  or  a
subsidiary,  intermediary  company or holding  company has the actual ability to
exercise  influence  over a licensee,  regardless of the percentage of ownership
possessed by said  entity,  the  Colorado  Commission  may require the entity to
comply with the disclosure regulations contained in Rule 4.5.

           Under  Rule  4.5,   gaming   licensees,   affiliated   companies  and
controlling  persons  commencing  a public  offering of voting  securities  must
notify the Colorado Commission no later than ten business days after the initial
filing of a registration  statement with the Securities and Exchange Commission.
Licensed publicly traded corporations are also required to send proxy statements
to the Division of Gaming within 5 days after their  distribution.  Licensees to
whom Rule 4.5 applies must include in their charter  documents  provisions that:
restrict the rights of the  licensees to issue  voting  interests or  securities
except in accordance with the Colorado Gaming Act and the Colorado  Regulations;
limit the  rights of persons to  transfer  voting  interests  or  securities  of
licensees  except in  accordance  with the Colorado  Gaming Act and the Colorado
Regulations;  and provide that  holders of voting  interests  or  securities  of
licensees  found  unsuitable by the Colorado  Commission  may, within 60 days of
such finding of unsuitability, be required to sell their interests or securities
back  to the  issuer  at the  lesser  of the  cash  equivalent  of the  holders'
investment  or the market price as of the date of the finding of  unsuitability.
Alternatively,   the  holders   may,   within  60  days  after  the  finding  of
unsuitability, transfer the voting interests or securities to a suitable person,
as  determined  by the  Colorado  Commission.  Until  the  voting  interests  or
securities  are held by suitable  persons,  the issuer may not pay  dividends or
interest,  the  securities  may not be voted,  they may not be  included  in the
voting or securities of the issuer,  and the issuer may not pay any remuneration
in any form to the holders of the securities.

         Pursuant to Rule 4.5, persons who acquire direct or indirect beneficial
         ownership of

      o      5% or more of any class of voting  securities of a publicly traded
             corporation  that  is  required  to  include  in its  articles  of
             organization the Rule 4.5 charter language provisions or

      o      5% or more of the beneficial interest in a gaming licensee directly
             or indirectly through any class of voting securities of any holding
             company  or  intermediary  company  of  a  licensee, referred to as
             qualifying persons, shall notify the Division of  Gaming  within 10
             days  of  such  acquisition,  are  required to submit all requested
             information and are subject to a finding of suitability as required
             by the Division of Gaming or  the  Colorado  Commission.  Licensees
             also must notify any qualifying persons of  these  requirements.  A
             qualifying  person  other  than  an  institutional  investor  whose
             interest equals 10% or more must apply to  the  Colorado Commission
             for a finding of suitability within 45 days  after  acquiring  such
             securities.  Licensees must also notify  any  qualifying persons of
             these requirements. Whether or not notified, qualifying persons are
             responsible for complying with these requirements.

           A qualifying  person who is an institutional  investor under Rule 4.5
and who,  individually  or in  association  with others,  acquires,  directly or
indirectly,  the  beneficial  ownership  of 15% or more of any  class of  voting
securities  must apply to the Colorado  Commission  for a finding of suitability
within 45 days after acquiring such interests.


                                                10
<PAGE>

           The  Colorado   Regulations  also  provide  for  exemption  from  the
requirements  for a finding of suitability  when the Colorado  Commission  finds
such action to be consistent with the purposes of the Colorado Act.

           Pursuant  to Rule  4.5,  persons  found  unsuitable  by the  Colorado
Commission  must be  removed  from any  position  as an  officer,  director,  or
employee  of a  licensee,  or  from a  holding  or  intermediary  company.  Such
unsuitable  persons also are  prohibited  from any  beneficial  ownership of the
voting  securities of any such entities.  Licensees,  or affiliated  entities of
licensees,  are subject to sanctions for paying  dividends or  distributions  to
persons found unsuitable by the Colorado  Commission,  or for recognizing voting
rights of, or paying a salary or any  remuneration  for services to,  unsuitable
persons.  Licensees or their  affiliated  entities  also may be  sanctioned  for
failing to pursue  efforts to require  unsuitable  persons to  relinquish  their
interest.  The Colorado  Commission  may  determine  that anyone with a material
relationship  to, or material  involvement  with,  a licensee  or an  affiliated
company must apply for a finding of suitability or must apply for a key employee
license.

Alcoholic Beverage Licenses

           The sale of alcoholic  beverages in gaming  establishments is subject
to strict  licensing,  control and  regulation  by state and local  authorities.
Alcoholic beverage licenses are revocable and  nontransferable.  State and local
licensing authorities have full power to limit,  condition,  suspend for as long
as six months or revoke any such licenses. Violation of state alcoholic beverage
laws may constitute a criminal  offense  resulting in  incarceration,  fines, or
both.

           There are  various  classes of retail  liquor  licenses  which may be
issued under the Colorado Liquor Code. A gaming  licensee may sell malt,  vinous
or  spirituous  liquors  only by the  individual  drink for  consumption  on the
premises.  Even though a retail gaming licensee may be issued various classes of
retail liquor  licenses,  such gaming  licensee may only hold liquor licenses of
the same class.  An application  for an alcoholic  beverage  license in Colorado
requires notice,  posting and a public hearing before the local liquor licensing
authority  prior to approval of the same.  The Colorado  Department of Revenue's
Liquor  Enforcement  Division must also approve the  application.  Riviera Black
Hawk's  hotel  and  restaurant  license  has been  approved  by both  the  local
licensing authority and the State Division of Liquor Enforcement.


Item 2.  Property

           Riviera  Black  Hawk is  located  on 1.63  acres  of land at 400 Main
Street, Black Hawk, Colorado. The buildings include approximately 325,000 square
feet and comprise 32,000 square feet of gaming space,  parking for approximately
520 vehicles  (substantially  all of which are covered),  a 252-seat buffet, two
bars and an entertainment center with seating for approximately 440 people.

           The entire  Riviera  Black Hawk complex is encumbered by a first deed
of trust securing the 13% Notes.

           See "Management's Discussion and Analysis of Financial Condition and
Results of Operations."

Item 3.  Legal Proceedings

         We may be a party to several routine  lawsuits both as plaintiff and as
defendant arising from the normal operations of a casino. We do not believe that
the outcome of such litigation,  in the aggregate,  will have a material adverse
effect on the financial position or results of our operations.

Item 4.  Submission of Matters to a Vote of Security Holders

         Not applicable.

PART II

Item 5.  Market for the Registrant's Common Stock and Related Security Holder
         Matters

         Not applicable.


                                                11
<PAGE>
Item 6.  Selected Financial Data

         The following table sets forth a summary of selected financial data for
the Company for the years ended December 31, in thousands:
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------
                                    2001       2000       1999        1998
-------------------------------------------------------------------------------

<S>                              <C>        <C>            <C>        <C>
Net Operating  Revenue           $49,046    $35,261        (a)         (a)
Net Income (Loss)                    589     (2,946)     $(474)         $0
Total Assets                      83,477     81,884     72,950      28,128
Long-Term Debt                   $40,777    $45,777    $45,742        $687
-------------------------------------------------------------------------------
</TABLE>

     (1) The Company was in the  development  stage from its inception on August
     18, 1997 through February 4, 2000. During fiscal 2000 and 1999, the Company
     recognized  $1,222,000 and $595,000 in preopening  expenses,  respectively.
     There were no operations in 1999.

Item 7.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations  Results of Operations


2001 Compared to 2000

Special Factors Effecting Comparability of Results of Operations

         The Riviera  Black Hawk was in the  development  stage during the first
half of 2000 until February 4, 2000 when it opened the casino. Accordingly,  the
results of  operations  for the fiscal 2001 and fiscal  2000  results may not be
comparable.

         The  following  table sets forth,  for the periods  indicated,  certain
operating  data for Riviera  Black Hawk.  EBITDA for the  purposes of this table
excludes,  pre-opening  expense and  inter-company  management  fees.  Operating
income is presented as shown on the Statement of Operations.
<TABLE>
<CAPTION>
                                                                    Change        % Change
                                        Year Ended December 31,    Incr/(Decr)    Incr/(Decr)
     (In thousands)                       2001          2000       ----------     ----------
                                          ----          ----
<S>                                      <C>           <C>            <C>              <C>
     Net revenues                      $49,046       $35,261        $13,785          39.1%
     Income(Loss) from operations       $7,622        $1,881         $5,741           305%
     EBITDA(2)                         $12,722        $6,597         $6,125          92.8%
     EBITDA Margin(3)                    25.9%         18.7%           9.3%

</TABLE>
   (2) EBITDA consists of Earnings Before Interest,  income Taxes, Depreciation,
       Amortization, preopening expenses, intercomany management fees and other,
       net. While EBITDA should not be construed as a  substitute  for operating
       income or a better indicator of liquidity than  cash flows from operating
       activities,  which are determined in accordance  with generally  accepted
       accounting  principles  ("GAAP"),  it  is  included  herein  to  provide
       additional  information with respect to the ability  of  the  Company  to
       meet  its  future debt service,  capital expenditures and working capital
       requirements.  Although  EBITDA  is  not  necessarily  a  measure  of the
       Company's  ability to  fund  its cash  needs,  management  believes  that
       certain investors  find EBITDA to  be a  useful  tool for  measuring  the
       ability of the  Company to service  its debt. EBITDA margin is EBITDA  as
       a percent of net revenues.  The Company's definition of EBITDA may not be
       comparable to other companies' definitions.

   (3) Shown as a percentage of net revenue.

                                                12
<PAGE>

Revenues

         Riviera  Black  Hawk net  revenues  increased  by  approximately  $13.8
million,  or 39.1%, from $35.3 million in the 11 months of 2000 to $49.0 million
in the 12 months ended  December 31, 2001 as the  operation  gained market share
and was  unaffected by the events of September 11.  Casino  revenues,  primarily

slot machines,  increased by approximately  $13.0 million,  or 38.7%, from $33.6
million  in the 11  months  of 2000 to  $46.7  million  in the 12  months  ended
December 31, 2001. Average slot machine win per unit increased from $114 per day
in 2000 to $148 in 2001. Food and beverage  revenues  increased by approximately
$1.5  million,  or  38.3%,  from $4.0  million  in the 11 months of 2000 to $5.6
million in the 12 months  ended  December  31, 2001.  The  remodeled  buffet and
related marketing efforts resulted in a 45.6% increase in covers (customers) and
a 26.4% increase in average check (price).

Income from Operations

Income from  operations  increased $5.7 million or 305% from $1.9 million in the
11 months of 2000 to $7.6 million in the 12 months  ended  December 31, 2001 due
to the  increase  in  revenues  and  better  margins  as  marketing  costs  were
stabilized.  Staffing was also optimized as full-time  equivalent employees were
reduced  from 450 at the  opening  in  February  2000 to 371 at the end of 2001.
Although  general and  administrative  costs  increased $1.7 million,  they were
23.5% of  revenues  in the current year  compared  with 27% in 2000.  Preopening
expense decreased $1.2 million and intercompany management fees based on revenue
and  EBITDA  increased $797,000. Depreciation  increased $809,000  or  27.5%  in
2001 compared with the 11 months of operations in 2000.

EBITDA

Riviera Black Hawk EBITDA, as defined,  increased by approximately $6.1 million,
or 92.8%,  from $6.6 million in the 11 months of 2000 to $12.7 million in the 12
months ended December 31, 2001. During the same periods, EBITDA margin increased
from 18.7% to 25.9% of net revenues.

Other Income (Expense)

           Interest expense  on the 13% First  Mortgage  Notes combined with its
interest on capital leases totaled $6.7 million in 2001 compared to $7.7 million
in 2000. Capitalized interest was $577,000 in 2000, which related to capitalized
amounts prior to the completion of the casino project.

Net Income

           Net income  increased  approximately $3.5 million from a loss of $2.9
million  in  2000  to  a  profit  of  $589,000  in 2001.  Income from operations
accounted  for  $5.9  million  of the  increase  and  interest  expense declined
$947,000 due to the repurchase of a portion  of  the 13%  first  Mortgage Notes.
These increases were partially offset by a $219,000 reduction of interest income
due  to  lower  interest  rates, $577,000  less  capitalized interest and a $2.4
million increase in income taxes due to the increase in pretax income.


2000 Compared to 1999

         Special Factors Effecting Comparability of Results of Operations

         Riviera Black Hawk was in the  development  stage during 1999 and until
February 4, 2000 when the casino opened.  Accordingly,  the consolidated results
of operations for fiscal 2000 and 1999 may not be comparable.


                                                13
<PAGE>

         The  following  table sets forth,  for the periods  indicated,  certain
operating  data for Riviera  Black Hawk.  EBITDA for the  purposes of this table
excludes,  pre-opening  expense and  inter-company  management  fees.  Operating
income is presented as shown on the Statement of Operations.
<TABLE>
<CAPTION>

                                                                      Change       % Change
                                          Year Ended December 31,   Incr/(Decr)   Incr/(Decr)
     (In thousands)                          2000        1999       ----------    ----------
                                             ----        ----

<S>                                         <C>           <C>          <C>           <C>
     Net revenues                         $35,261       $ n/a        $35,261         100%
     Income(Loss) from operations          $1,881      $(595)         $2,476         416%
     EBITDA                                $6,597          $1         $6,596          n/a
     EBITDA Margin                          18.7%         n/a            n/a          n/a


</TABLE>

Revenues

           Riviera Black Hawk opened on February 4, 2000. It had net revenues of
approximately  $35.3 million for the  approximate  eleven-month  period in 2000.
Casino revenues were $33.6 million,  including $31.9 million in slot revenue and
$1.7 million in table games revenue.

           Food and beverage revenues were approximately $4.0 million,  of which
$2.8 million were  complimentary  (promotional  allowance).  Other revenues were
approximately $0.4 million primarily from ATM transaction fees.

EBITDA

           Riviera Black Hawk EBITDA, as defined, was $6.6 million, or 18.7%, of
net revenues.

Other Income (Expense)

           Interest  expense on the $45 million 13% First  Mortgage Notes issued
by Riviera  Black Hawk in June 1999  combined  with its  interest  from  capital
leases totaled $7.7 million in 2000.  Capitalized interest was $577,000 in 2000,
which was from the Black Hawk,  Colorado project,  decreased  approximately $2.5
million from 1999.

Net Loss

           The net loss increased approximately $2.4 million from $.5 million in
1999 to $2.9  million in 2000 due  primarily  to higher  preopening  expense and
higher interest expense offset by lower  capitalized  interest in 2000.  Federal
income  tax  benefits  as  a  percent  of losses were higher in 2000 because the
Company had fewer permanent  tax  adjustments  in  fiscal 2000 compared to 1999,
when there were no operations.


                                                14
<PAGE>

Liquidity and Capital Resources

         At  December  31,  2001,  RBH had cash and  cash  equivalents  of $11.5
million. The  Company  may  transfer  the  $3.3  million  due  to  its parent if
demanded. During 2001, the  payment  of  management fees totaling $2 million was
restricted wntil the fixed charge coverage ratio as defined, reached 1.5 to one.
As  of  December 31, 2001,  there  was  no  restriction  on  the  payment of the
management fees to the parent. The Company had net shareholder's equity of $29.9
million.

         The   Company's  net  cash   provided  by  operating   activities   was
approximately  $8.6 million for the year ended  December  31,  2001.  Management
believes that the $11.5 million in cash and cash  equivalents will be sufficient
to cover the Company's  budgeted capital  expenditures for the next 12 months of
approximately $2.4 million.

         As of December 31, 2000, Riviera Holdings Corporation contributed $15.1
million to acquire  land for the casino in Black Hawk and $14.9  million in cash
for  developing  the land for the casino.  During 2001,  Riviera  Holdings  made
additional   contributions  of  $3,045,000  under  the  terms  of  the  Keepwell
Agreement, for total cash contributions to date of $33 million.

         During 2001,  Riviera  Black Hawk  repurchased  $3.5 million of the 13%
Notes on the open market at par.

         Cash flow from  operations  may not be sufficient  to pay 100%  of  the
principal of the $45 million 13% Notes at maturity on May 1, 2005. Accordingly,
the  ability  of  Riviera  Black  Hawk  to  repay the Notes at  maturity  may be
dependent  upon  our  future  cash  flows and  our  ability to  refinance  those
notes.  There can  be  no assurance  that the Company will be able to  refinance
the  principal  amount  of the  Notes at  maturity. Although Riviera Black Hawk,
Inc. can, at any time prior to May 1, 2001,  redeem up to 35% of  the  aggregate
principal  amount  of  the 13%  notes  at 113% with  the proceeds of a qualified
public  offering,  the subsidiary may not redeem 100% of the 13% Notes until May
1, 2002,  at premiums  beginning at 106.5% and declining each subsequent year to
par in 2004.

         The 13% Note Indentures provide that, in certain circumstances, Riviera
Black Hawk must offer to repurchase the Notes upon the occurrence of a change of
control or certain other events.  In the event of such  mandatory  redemption or
repurchase  prior to maturity,  the Company would be unable to pay the principal
amount of the Notes without a refinancing.

         The 13% Note  Indenture  contains  certain  covenants,  which limit the
ability  of the  Company  and its  restricted  subsidiaries,  subject to certain
exceptions,  to: (i) incur additional indebtedness;  (ii) pay dividends or other
distributions,   repurchase   capital   stock  or  other  equity   interests  or
subordinated   indebtedness;   (iii)  enter  into  certain   transactions   with
affiliates;  (iv) create certain liens; sell certain assets;  and (v) enter into
certain  mergers  and  consolidations.  As a result of these  restrictions,  the
ability of the Company to incur additional indebtedness to fund operations or to
make  capital  expenditures  is  limited.  In the  event  that  cash  flow  from
operations  is  insufficient  to cover cash  requirements,  the Company would be
required to curtail or defer certain of their capital expenditure programs under
these  circumstances,  which  could  have an  adverse  effect  on the  Company's
operations.  At December 31, 2001, the Company believes that it is in compliance
with the covenants.


                                                15
<PAGE>

Recently Adopted Accounting Standards

         The FASB issued SFAS No. 133,  "Accounting for  Derivatives,"  which is
effective for fiscal years beginning after June 15, 2000. This statement defines
derivatives  and  requires  qualitative  disclosure  of  certain  financial  and
descriptive information about a company's derivatives.  The Company adopted SEAS
No. 133 in the quarter  ended March 31, 2001.  The adoption of this SEAS 133 had
no impact on the Company or the Company's consolidated financial statements.

         The EITF of the  American  Institute of  Certified  Public  Accountants
issued  EITF No.  00-22  Titled  "Accounting  for  "Points"  and  Certain  Other
Timed-Based Sales Incentive Offers,  and Offers for Free Products or Services to
Be Delivered in the Future" on January 18, 2001.  The EITF concluded that when a
company  or vendor  offers to a  customer  (a) free or  discounted  products  or
services  that will be delivered  (either by the vendor or by another  unrelated
entity) at a future date (1) as a result of a single  revenue  transaction  with
the customer or (2) only if the customer completes a specified  cumulative level
of revenue  transactions with the vendor or remains a customer of the vendor for
a specified time period and (b) a rebate or refund of a determinable cash amount
only  if  the  customer  completes  a  specified  cumulative  level  of  revenue
transactions with the vendor or remains a customer of the vendor for a specified
time period,  such rebates  should be reported as a reduction of revenues.  This
EITF was required to be adopted by the Company during the first quarter of 2001.
As a result of adopting EITF 00-22, the Company reclassified  approximately $2.6
million of such "Points"  from Casino  operating  expense to net against  Casino
revenues for the period ended December 31, 2000.

         The EITF of the  American  Institute of  Certified  Public  Accountants
issued EITF No. 00-14 titled  "Accounting for Certain Sales Incentives" on April
18,2001.  The EITF  concluded that when a company or vendor offers its customers
sales  incentives  including  discounts,  coupons,  rebates and free products or
services, such sales incentives should be reported as reduction of revenues. The
EITF  concluded  that  when a company  or  vendor  offers  its  customers  sales
incentives including discounts, coupons, rebates, and free products or services,
such sales incentives  should be reported as a reduction of revenues.  This EITF
was  required  to be adopted by the Company  during the fourth  quarter of 2001.
Early  adoption is permitted.  The Company chose to adopt this EITF in the first
quarter of 2001.  As a result of adopting EITF 00-14,  the Company  reclassified
approximately  $1.8 million of such sales incentive  offers "cash vouchers" from
Casino  operating  expense to net against  Casino  revenues for the period ended
December 31, 2000.

Recently Issued Accounting Standards

         In July 2001,  the FASB issued SFAS No. 141,  "Business  Combinations."
SFAS 141 requires the purchase  method of accounting  for business  combinations
initiated  after June 30, 2001 and eliminates the  pooling-of-interests  method.
The  Company  does not  believe  that  the  adoption  of SFAS  141  will  have a
significant impact on its financial statements.

         In July  2001,  the FASB  issued  SFAS No.  142,  "Goodwill  and  Other
Intangible Assets", which is effective January 1, 2002. SFAS 142 requires, among
other things,  the  discontinuance of goodwill  amortization.  In addition,  the
standard  includes  provisions  for the  reclassification  of  certain  existing
recognized intangibles as goodwill, reassessment of the useful lives of existing
recognized   intangibles,   reclassification   of  certain  intangibles  out  of
previously  reported  goodwill and the  identification  of  reporting  units for
purposes of assessing  potential future  impairments of goodwill.  SFAS 142 also
requires the Company to complete a  transitional  goodwill  impairment  test six
months from the date of adoption. The Company is currently assessing but has not
yet determined  the impact of SFAS 142 on its financial  position and results of
operations.

         The  FASB  issued  SFAS  No.  143  "Accounting  for  Asset   Retirement
Obligations" in June of 2001. This Statement addresses financial  accounting and


                                                16
<PAGE>
reporting for obligations  associated with the retirement of tangible long-lived
assets and the associated asset retirement  costs. This Statement applies to all
entities.  It applies to legal  obligations  associated  with the  retirement of
long-lived  assets that result from the acquisition,  construction,  development
and  (or) the  normal  operation  of a  long-lived  asset,  except  for  certain
obligations  of lessees.  This  Statement is effective for financial  statements
issued for fiscal years  beginning after June 15, 2002. The Company is currently
assessing,  but  has not yet  determined  the  impact  of  SFAS  No.  143 on its
financial position and results of operations.

The FASB  issued  SFAS No. 144  "Accounting  for the  Impairment  or Disposal of
Long-Lived   Assets"  in  August  of  2001.  This  Statement  address  financial
accounting and reporting for the impairment or disposal of long-lived assets and
supersedes  FASB Statement No. 121,  Accounting for the Impairment of Long-Lived
Assets and for  Long-Lived  Assets to Be  Disposed  of, and the  accounting  and
reporting   provisions  of  APB  Opinion  No.  30,   Reporting  the  Results  of
Operations-Reporting  the Effects of  Disposal  of a Segment of a Business,  and
Extraordinary,  Unusual and Infrequently Occurring Events and Transactions,  for
the disposal of a segment of a business (as previously defined in that opinion).
This Statement also amends ARB No. 51,  Consolidated  Financial  Statements,  to
eliminate the exception to  consolidation  for a subsidiary for which control is
likely to be  temporary.  The  provisions  of this  Statement  are effective for
financial  statements issued for fiscal years beginning after December 15, 2001,
and  interim  periods  within  those  fiscal  years.  The  Company is  currently
assessing,  but  has not yet  determined  the  impact  of  SFAS  No.  144 on its
financial position and results of operations.

Critical Accounting Policies

The preparation of the Company's  consolidated financial statements requires the
Company's  management  to adopt  accounting  policies and to make  estimates and
assumptions that affect the reported amounts of assets, liabilities, revenue and
expenses.   Management  periodically  evaluates  its  policies,   estimates  and
assumptions  related  to,  these  policies.  The  Company  operates  in a highly
regulated  industry.  For both our Las Vegas,  Nevada and Black  Hawk,  Colorado
operations we are subject to  regulations  that describe and regulate  operating
and internal  control  procedures.  The majority of our casino revenue is in the
form of cash, personal checks or gaming chips and tokens,  which by their nature
do not require complex estimations. We estimate certain liabilities with payment
periods  that extend for longer than  several  months.  Such  estimates  include
customer  loyalty  liabilities,  self-insured  medical and workers  compensation
costs and litigation costs. We believe that these estimates are reasonable based
upon our past  experience  with the  business  and  based  upon our  assumptions
related to possible  outcomes in the future.  Future actual  results will likely
differ from these estimates.

The Company has determined  that the following  accounting  policies and related
estimates  are  critical  to  the  preparation  of  the  Company's  consolidated
financial statements:

Long-lived Assets:

The Company has a significant  investment in long-lived  property and equipment.
The Company estimates that the undiscounted future cash flows expected to result
from the use of these assets exceeds the current carrying value of these assets.
Any adverse change to the estimate of these undiscounted future cash flows could
necessitate an impairment charge that would adversely affect operating  results.
The  Company   estimates  useful  lives  for  its  assets  based  on  historical
experience,  estimates  of  assets'  commercial  lives,  and the  likelihood  of
technological  obsolescence.  Should the actual useful life of a class of assets
differ from the  estimated  useful life,  the Company would record an impairment
charge. The Company reviews useful lives, obsolescence,  and assesses commercial
viability of these assets periodically.

We utilize estimates related to cash flow projections related to the application
of SFAS 109 for the realization of deferred tax assets.  Our estimates are based
upon recent operating  results and budgets for future operating  results.  These
estimates are made using assumptions  about the economic,  social and regulatory
environments in which we operate.  These estimates could be negatively  impacted
by numerous unforeseen events including changes to regulations  affecting how we
operate our business,  changes in the labor market or economic  downturns in the
areas where we operate.


                                                17
<PAGE>


Item 7a. Quantitative and Qualitative Disclosure about Market Risk

         Market risks relating to our operations  result  primarily from changes
in interest  rates.  We invest our cash and cash  equivalents  in U.S.  Treasury
Bills with maturities of 90 days or less.
<TABLE>
<CAPTION>
Interest Rate Sensitivity
Principal (Notational Amount by Expected Maturity)
Average Interest Rate

(Amounts in Thousands)                                                                                          Fair Value
                                  2002       2003       2004       2005       2006     Thereafter      Total        At
                                                                                                                 12/31/01
<S>                                <C>       <C>        <C>        <C>         <C>        <C>            <C>        <C>
Long Term Debt
Including Current Portion


Equipment loans
Black Hawk, Colorado               $8                                                                    $8         $8

Average interest rate             11.2%

Capital leases
Black Hawk, Colorado           $1,848      $2,044     $2,263       $658                              $6,814     $6,814

Average interest rate           10.8%      10.8%       10.8%       10.8%

Special Improvement
District Bonds-Black Hawk,
 Colorado casino project          $97        $103       $109       $116       $124         $411        $960       $960

Average interest rate             5.5%       5.5%       5.5%       5.5%

 13% First Mortgage Note
Black Hawk, Colorado casino
Project                                                          $34,941                              $34,941    $34,941

Average interest rate                                              13.0%

</TABLE>
Forward Looking Statements

         The Private  Securities  Litigation Reform Act of 1998 provides a "safe
harbor" for certain  forward-looking  statements.  Certain matters  discussed in
this  filing  could  be  characterized  as  forward-looking  statements  such as
statements  relating  to plans for future  expansion,  as well as other  capital
spending,  financing  sources and effects of regulation  and  competition.  Such
forward-looking  statements involve important risks and uncertainties that could
cause  actual  results  to  differ  materially  from  those  expressed  in  such
forward-looking statements



                                                18
<PAGE>

Item 8.  Financial Statements and Supplementary Data

         See financial statements included in Item 14 (a).

Item 9.  Changes in and Disagreements with Accountants on Accounting and
         Financial Disclosure.

         None

Item 10.  Directors and Executive Officers of the Registrant (not applicable)

Item 11.  Executive Compensation (not applicable)

Item 12.  Security Ownership of certain Beneficial Owners and Management
          (not applicable)

Item 13.  Certain Relationships and Related Transactions

         The Company has a management  agreement  (the  "Management  Agreement")
with Riviera Gaming  Management of Colorado,  Inc.,  (the "Manager") an indirect
wholly owned subsidiary of Riviera Holdings  Corporation,  which will manage the
Company. The management fee consists of a revenue fee and a performance fee. The
revenue  fee is  based on one  percent  of net  revenues  (gross  revenues  less
complimentaries)  and is payable  quarterly in arrears.  The  performance fee is
based on the following  percentages of EBITDA (earnings before interest,  taxes,
depreciation and amortization,  whose components are based on generally accepted
accounting principles): (1) 10 percent of EBITDA from $5 million to $10 million,
(2) 15 percent of EBITDA  from $10  million to $15 million and (3) 20 percent of
EBITDA in excess of $15 million.  The  performance fee is based on the preceding
quarter's EBITDA, paid in quarterly installments subject to year-end adjustment.
Under the 13% bond  indenture,  the management fees cannot be paid to the parent
unless the fixed charge coverage ratio exceeds 1.5 to one. Therefore, subsequent
to the first  quarter of 2000,  these fees totaling  approximately  $1.9 million
have not been paid.  In addition,  inter-company  charges for the cost of labor,
goods and services  provided by the parent totaling  approximately  $1.4 million
remain unpaid at December 31, 2001 and are evidenced by notes receivable.  It is
anticipated that these advances will be repaid in 2002.


PART IV Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K

          (a)(1) List of Financial Statements

         The following Independent Auditor's Report and the Financial Statements
of the Company are  incorporated  by reference into this item 14 of Form 10-k by
Item 8 hereof:

Independent Auditor's Report dated February 12, 2002

Balance Sheets as of December 31, 2001 and 2000

Statements of Operations for the Three years Ended December 31, 2001

Statements of Stockholder's Equity for the Three Years Ended December 31, 2001

Statements of Cash Flows and for the Three Years Ended  December  31, 2001


                                                19
<PAGE>

Notes to Financial Statements

          (a)(2) List of Financial Statement Schedules

         No financial  statement  schedules  have been filed herewith since they
are either not required,  are not  applicable,  or the required  information  is
shown in the consolidated financial statements or related notes.

         (a)(3) List of Exhibits

         Exhibits  required  by Item 601 of  Regulation  S-K are  listed  in the
Exhibit Index herein, which information is incorporated by reference.

         (b)  Reports  on Form  8-K- No  reports  of Form 8-K were  filed in the
fourth quarter of 2001.








                                                20
<PAGE>


SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Amendment to be signed
on its behalf by the undersigned,  thereunto duly authorized, in the City of Las
Vegas, State of Nevada, on the 28th day of March, 2000.

                           RIVIERA BLACK HAWK, INC.

                           By: /s/ WILLIAM L. WESTERMAN

                           William L. Westerman Chief
                           Executive Officer and Director

                           March 22, 2002

         Pursuant to the  requirement  of the  Securities  Exchange Act of 1934,
this  Amendment has been signed below by the following  persons on behalf of the
Registrant and in the capacities and on the dated indicated.

Signature                                Title                       Date

By: /s/ WILLIAM L. WESTERMAN
William L. Westerman Chief Executive Officer and Director        March 22, 2002

By:/s/ RONALD P. JOHNSON
Ronald P. Johnson President and Director                         March 22, 2002

By: /s/ DUANE R. KROHN
Duane R. Krohn Treasurer, Chief Financial Officer
and Director                                                     March 22, 2002








                                                21
<PAGE>

Item 14a(3)

EXHIBIT INDEX

Exhibit No.                                 Description

3.01 Articles of Amendment to the Articles of Incorporation of the Company.*

3.02 Articles of Incorporation of the Company.*

3.03 Bylaws of the Company.*

4.01 Indenture,  dated as of June 3, 1999,  among the Company,  Riviera Holdings
and the Initial Purchaser.*

4.02 Form of 13% First Mortgage Note due 2005 with Contingent Interest (included
in Exhibit 4.01).*

4.03  Purchase  Agreement,  dated as of May 27, 1999,  by and among the Company,
Riviera Holdings and the Initial Purchaser.*

4.04 Registration Rights Agreement, dated as of June 3, 1999, by and between the
Company and the Initial Purchaser.*

10.01  The  Completion  Capital  Commitment,  dated as of June 3,  1999,  by and
between the Company and Riviera Holdings.*

10.02 The  Keep-Well  Agreement,  dated as of June 3, 1999,  by and  between the
Company and Riviera Holdings.*

10.03 The  Tax-Sharing  Agreement,  dated as of June 3, 1999, by and between the
Company and Riviera Holdings.*

10.04 The  Management  Agreement,  dated as of June 3, 1999,  by and between the
Company and Riviera Gaming Management of Colorado, Inc.*

10.05 The Trademark License Agreement,  dated as of June 3, 1999, by and between
the Company and Riviera Operating Corporation.*

10.06 The Deed of Trust,  dated as of June 3, 1999,  made by the  Company to the
Public  Trustee  of the  County of  Gilpin,  Colorado,  for the  benefit  of the
Trustee.*

10.07 The Assignment of Rents.*

10.08 The Environmental Indemnity, dated as of June 3, 1999, between the Company
and the Trustee.*

10.09 The Cash Collateral and Disbursement Agreement,  dated as of June 3, 1999,
among the Company, the Trustee and CRSS Constructors, Inc.*

10.10 The Account  Agreement,  dated as of June 3, 1999, among the Company,  the
Trustee and IBJ Whitehall Bank and Trust Company.*


                                                22
<PAGE>

10.11 The Security  Agreement,  dated as of June 3, 1999, made by the Company in
favor of the Trustee.*

10.12 The Manager Subordination Agreement,  dated as of June 3, 1999, by Riviera
Gaming Management of Colorado in favor of the Trustee.*

10.13 The Collateral  Assignment of Trademark,  dated as of June 3, 1999, by and
between the Company and the Trustee.*

10.14 The  Collateral  Assignment,  dated as of June 3, 1999, by and between the
Company and the Trustee.*

10.15 The  Pledge and  Assignment  Agreement,  dated as of June 3, 1999,  by and
between the Company and the Trustee.*

10.16 Deposit Account  Agreement,  dated as of June 1999, among Bank of America,
Riviera Holdings and First American Title Insurance Company.*

10.17 Construction Contract, made as of December 29, 1997, among the Company,
Weitz-Cohen  Construction Co. and Melick Associates, Inc.*

10.18 Letter Agreement, dated January 6, 1999, between Riviera Gaming Management
and Jim Davey.*

10.19 Letter Agreement, dated January 15, 1999, between Riviera Gaming
Management and Tom Guth.*

10.20 Master Lease  Agreement  dated  December 13, 1999 between PDS  Financial
Corporation-Colorado  and Riviera Black Hawk,  Inc.  for  furniture,  fixtures,
gaming and other equipment.*

10.21 Lease Schedule No. 1 dated January 25, 2000 under Master  Lease  Agreement
dated  December  13, 1999 between PDS Financial Corporation-Colorado and Riviera
Black Hawk, Inc. for furniture, fixtures, gaming and other equipment.*

10.22 Lease Schedule No. 2 dated January 25, 2000 under Master  Lease  Agreement
dated  December  13, 1999 between PDS Financial Corporation-Colorado and Riviera
Black Hawk, Inc. for furniture, fixtures, gaming and other equipment.*

10.23 Lease Schedule No. 3 dated February  17, 2000 under Master Lease Agreement
dated  December 13, 1999 between PDS Financial Corporation-Colorado and Riviera
Black Hawk, Inc. for furniture, fixtures, gaming and other equipment.*

10.24 Lease Schedule No. 4 dated February  17, 2000 under Master Lease Agreement
dated  December 13, 1999 between PDS Financial Corporation-Colorado and Riviera
Black Hawk, Inc. for furniture, fixtures, gaming and other equipment.*

12.01 Statement in re Computation of Ratios.*

Pursuant to Item  601(b)(2) of Regulation  S-K, the schedules to this  Agreement
are  omitted.  The  Exhibit  contains a list  identifying  the  contents  of all
schedules  and the  Registrants  agree to furnish  supplementary  copies of such
schedules to the Commission upon request.

 *  Previously filed.


                                                23
<PAGE>
<TABLE>
<CAPTION>
RIVIERA BLACK HAWK, INC.
(A Wholly Owned Subsidiary of Riviera Holdings Corporation)

TABLE OF CONTENTS
-------------------------------------------------------------------------------------------------------------


                                                                                                     Page

<S>                                                                                                   <C>
INDEPENDENT AUDITORS' REPORT                                                                           F-1

FINANCIAL STATEMENTS:

   Balance Sheets as of December 31, 2001 and 2000                                                     F-2

   Statements of Operations for the Years Ended December 31, 2001, 2000, and 1999                      F-3

   Statements of Stockholder's Equity for the Years Ended December 31, 2001, 2000, and 1999            F-4

   Statements of Cash Flows for the Years Ended December 31, 2001, 2000, and 1999                      F-5

   Notes to Financial Statements                                                                       F-6

   Unaudited Quarterly Information                                                                    F-15


</TABLE>








<PAGE>







INDEPENDENT AUDITORS' REPORT


Riviera Black Hawk, Inc.:

We have audited the  accompanying  balance sheets of Riviera Black Hawk, Inc. (a
wholly owned subsidiary of Riviera Holdings  Corporation)  (the "Company") as of
December  31,  2001  and  2000  and  the  related   statements  of   operations,
stockholder's  equity,  and cash flows for each of the three years in the period
ended December 31, 2001. These financial  statements are the  responsibility  of
the Company's  management.  Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform the audit to obtain  reasonable  assurance  about  whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our  opinion,  such  financial  statements  present  fairly,  in all material
respects, the financial position of the Company as of December 31, 2001 and 2000
and the results of its operations and its cash flows for each of the three years
in the period ended December 31, 2001, in conformity with accounting  principles
generally accepted in the United States of America.



Deloitte & Touche LLP
Las Vegas, Nevada
February 12, 2002


                                                F-1
<PAGE>
<TABLE>
<CAPTION>

RIVIERA BLACK HAWK, INC.
(A Wholly Owned Subsidiary of Riviera Holdings Corporation)

BALANCE SHEETS
DECEMBER 31, 2001 AND 2000 (In Thousands, Except Share Amounts)
---------------------------------------------------------------------------------


ASSETS                                                       2001          2000

CURRENT ASSETS:
<S>                                                           <C>           <C>
  Cash and cash equivalents                                $11,459       $ 7,744
  Accounts receivable, net                                     169           165
  Inventories                                                  184           270
  Prepaid expenses                                             409           565
                                                            ------         -----
           Total current assets                             12,221         8,744

PROPERTY AND EQUIPMENT, Net                                 67,549        68,505

DEFERRED FINANCING COSTS                                     1,930         2,492

OTHER ASSETS                                                    44            18

DEFERRED INCOME TAXES                                        1,733         2,125
                                                             -----         -----
TOTAL                                                      $83,477       $81,884
                                                          ========       =======
LIABILITIES AND STOCKHOLDERS EQUITY

CURRENT LIABILITIES:
  Current portion of long-term debt                        $ 1,953       $ 1,770
  Accounts payable                                           2,035         2,565
  Accrued interest                                           1,520         1,162
  Accrued expenses                                           3,937         3,253
  Payable to Parent                                          3,335         1,064
                                                            ------         -----
           Total current liabilities                        12,780         9,814

LONG-TERM DEBT, Net of current portion                      40,770        45,777
                                                            ------        ------
           Total liabilities                                53,550        55,591
                                                            ------        ------
COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS EQUITY:
  Common stock, $.01 par value; 10,000 shares authorized;
    1,000 shares issued and outstanding
  Additional paid-in capital                                32,758        29,713
  Accumulated deficit                                       (2,831)       (3,420)
                                                            ------        ------
           Total stockholders equity                        29,927        26,293
                                                           -------       -------
TOTAL                                                      $83,477       $81,884
                                                           =======       =======
See notes to financial statements.
</TABLE>

                                                F-2
<PAGE>
<TABLE>
<CAPTION>
RIVIERA BLACK HAWK, INC.
(A Wholly Owned Subsidiary of Riviera Holdings Corporation)

STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 2001, 2000, AND 1999 (In Thousands)
-----------------------------------------------------------------------------------------


                                                         2001           2000          1999

REVENUES:
<S>                                                       <C>            <C>           <C>
  Casino                                                $46,650        $33,636
  Food and beverage                                       5,560          4,018
  Entertainment                                             274
  Other                                                     572            374
                                                         ------         ------
           Total revenues                                53,056         38,028
  Less promotional allowances                             4,010          2,767
                                                         ------         ------
           Net revenues                                  49,046         35,261

COSTS AND EXPENSES:
  Direct costs and expense of operating departments:
    Casino                                               22,648         17,286
    Food and beverage                                     2,093          1,599
    Entertainment                                            77              5
  Other operating expenses:
    General and administrative                           11,506          9,774
    Preopening expenses                                                  1,222         $ 595
    Intercompany management fees                          1,354            557
    Depreciation and amortization                         3,746          2,937
                                                         ------         ------          ----
           Total costs and expenses                      41,424         33,380           595
                                                         ------         ------          ----
INCOME (LOSS) FROM OPERATIONS                             7,622          1,881          (595)
                                                         ------         ------          ----
OTHER (EXPENSE) INCOME:
  Interest expense                                       (6,740)        (7,687)       (3,717)
  Interest income                                            99            318           567
  Interest capitalized                                                     577         3,111
                                                         -------        -------        ------
           Total other expense                           (6,641)        (6,792)          (39)
                                                         -------        -------        ------
INCOME (LOSS) BEFORE PROVISION (BENEFIT)
  FOR INCOME TAXES                                          981         (4,911)         (634)

PROVISION (BENEFIT) FOR INCOME TAXES                        392         (1,965)         (160)
                                                         ------        --------       -------
NET INCOME (LOSS)                                         $ 589        $(2,946)       $ (474)
                                                         ======        ========       =======

See notes to financial statements.
</TABLE>


                                                F-3

<PAGE>
<TABLE>
<CAPTION>

RIVIERA BLACK HAWK, INC.
(A Wholly Owned Subsidiary of Riviera Holdings Corporation)

STATEMENTS OF STOCKHOLDERS EQUITY
YEARS ENDED DECEMBER 31, 2001, 2000, AND 1999
(In Thousands, Except Share Amounts)
----------------------------------------------------------------------------------------------------


                                                          Additional
                                    Common Stock            Paid-in     Accumulated
                                 Shares       Amount        Capital       Deficit        Total

<S>                               <C>            <C>        <C>             <C>           <C>
BALANCE, JANUARY 1, 1999         1,000          $ -        $ 20,000                    $ 20,000

  Contributed capital                                         3,474                       3,474

  Net loss                                                                $ (474)          (474)
                                 -----         -----         ------       -------       -------
BALANCE, DECEMBER 31, 1999       1,000                       23,474         (474)        23,000

  Contributed capital                                         6,239                       6,239

  Net loss                                                                (2,946)        (2,946)
                                 -----         -----         ------       -------        -------
BALANCE, DECEMBER 31, 2000       1,000                       29,713       (3,420)        26,293

  Contributed capital                                         3,045                       3,045

  Net income                                                                 589            589
                                 -----         -----         ------       -------        ------
BALANCE, DECEMBER 31, 2001       1,000          $ -        $ 32,758      $(2,831)      $ 29,927
                                 =====         =====        =======       =======        ======

See notes to financial statements.
</TABLE>

                                                F-4
<PAGE>
<TABLE>
<CAPTION>
RIVIERA BLACK HAWK, INC.
(A Wholly Owned Subsidiary of Riviera Holdings Corporation)

STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 2001, 2000, AND 1999 (In Thousands)
--------------------------------------------------------------------------------------------------------------------


                                                                                      Years Ended December 31,
                                                                               -------------------------------------
                                                                                   2001          2000         1999
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                                    <C>        <C>           <C>
  Net income (loss)                                                               $ 589      $ (2,946)     $ (474)
  Adjustments to reconcile net income (loss) to net cash provided by
    operating activities:
    Amortization of bond offering costs                                             562           576         338
    Depreciation and amortization                                                 3,746         2,937
    Provision for bad debts                                                         136            43
    Changes in operating assets and liabilities:
      Decrease (increase) in accounts receivable                                   (140)         (208)
      Decrease (increase) in inventories                                             86          (270)
      Decrease (increase) in prepaid expenses                                       156           230        (722)
      Increase (decrease) in accounts payable                                       (10)        3,847         487
      Increase (decrease) in accrued payroll and benefits                           468         1,070         110
      Increase (decrease) in accrued interest expense                               358           186         976
      Increase (decrease) in payable to Parent                                    2,271         1,064
      Decrease (increase) in other assets                                           (26)          371          (9)
      Decrease (increase) in deferred tax asset                                     392        (1,965)       (160)
                                                                                  -----         -----        -----
           Net cash provided by operating activities                              8,588         4,935         546
                                                                                  -----         -----        -----
CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchase of property and equipment                                             (2,640)      (16,969)    (27,291)
  Decrease (increase) in cash and restricted and short-term investments                         7,173      (6,766)
  Decrease (increase) in short-term investments                                                 2,820      (2,820)
                                                                                 -------       ------       ------
           Net cash used in investing activities                                 (2,640)       (6,976)    (36,877)
                                                                                 -------       ------       ------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Payment on long-term debt                                                      (1,778)       (1,223)         (2)
  Payments to Riviera Holdings Corporation                                                                 (6,241)
  Purchase of 13% First Mortgage Notes                                           (3,500)       (6,559)
  Proceeds from long-term borrowings net of financing costs of $0, $0, and $3,784               9,518      41,216
  Contribution of capital                                                         3,045         6,239       2,625
                                                                                  -----         -----       -----
           Net cash (used in) provided by financing activities                   (2,233)        7,975      37,598
                                                                                  -----         -----       -----
INCREASE IN CASH AND CASH EQUIVALENTS                                             3,715         5,934       1,267

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR                                      7,744         1,810         543
                                                                                  -----         -----       -----
CASH AND CASH EQUIVALENTS, END OF YEAR                                         $ 11,459       $ 7,744     $ 1,810
                                                                                 ======         =====       =====
INTEREST PAID                                                                   $ 6,382       $ 6,714     $ 2,403
                                                                                 ======         =====       =====
INCOME TAXES PAID                                                                               $ 110
                                                                                                =====
SUPPLEMENTAL DISCLOSURE OF NONCASH INFORMATION:
  Property acquired using special improvement district bonds                      $ 454                      $ 97
                                                                                  =====                      ====
  Property and equipment purchased using accounts payable                          $ 90         $ 304     $ 2,566
                                                                                  =====         =====       =====
  Capitalized interest, other                                                                   $ 577     $ 2,262
                                                                                                =====       =====
  Property acquired with debt                                                                                $ 29
                                                                                                             ====
  Capitalized interest contributed by Riviera Holdings Corporation                                          $ 849
                                                                                                             ====

See notes to financial statements.
</TABLE>


                                                F-5
<PAGE>


RIVIERA BLACK HAWK, INC.
(A Wholly Owned Subsidiary of Riviera Holdings Corporation)

NOTES TO FINANCIAL STATEMENTS
-------------------------------------------------------------------------------


1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      Organization  and Basis of  Presentation  - On August  18,  1997  (date of
      inception),  Riviera Black Hawk,  Inc.  (the  "Company")  was formed.  The
      Company is a wholly owned subsidiary of Riviera Holdings  Corporation (the
      "Parent").  The Company owns a casino and  entertainment  complex in Black
      Hawk,  Colorado.  The Company was in the development stage at December 31,
      1999 and  commenced  its  principal  operations  on February 4, 2000.  The
      Company began  construction on this casino in Black Hawk,  Colorado,  on a
      site that was  purchased  for $15.1  million in August 1997.  There was no
      statement of operations  activity for the year ended December 31, 1999, as
      the Company was in the development  stage and had no operating results for
      that period.

      Cash and Cash  Equivalents and Short-Term  Investments - All highly liquid
      investment  securities  with a  maturity  of  three  months  or less  when
      acquired are considered to be cash  equivalents.  The Company accounts for
      investment securities in accordance with Statement of Financial Accounting
      Standards ("SFAS") No. 115, Accounting for Certain Investments in Debt and
      Equity Securities.

      The  Company's  investment  securities,  along with  certain cash and cash
      equivalents that are not deemed securities under SFAS No. 115, are carried
      on the balance sheets in the cash and cash equivalents category.  SFAS No.
      115 addresses the  accounting  and  reporting  for  investments  in equity
      securities  that  have  readily  determinable  fair  values  and  for  all
      investments  in  debt  securities,  and  requires  such  securities  to be
      classified as either held to maturity, trading, or available for sale.

      Management  determines the  appropriate  classification  of its investment
      securities  at the time of purchase,  including  the  determination  as to
      restricted   versus   nonrestricted    assets,   and   re-evaluates   such
      determination at each balance sheet date.  Held-to-maturity securities are
      required to be carried at amortized  cost.  At December 31, 2001 and 2000,
      securities classified as held to maturity comprised debt securities issued
      by the U.S. Treasury and other U.S.  government agencies and corporations,
      and repurchase agreements, with an amortized cost of $4.3 million and $2.8
      million, respectively, maturing in 12 months or less.

      Inventories - Inventories  consist primarily of food, beverage,  gift, and
      promotional inventories and are stated  at  the  lower of cost (determined
      on a first-in, first-out basis) or market.

      Property and Equipment - Property and  equipment  are stated at cost,  and
      capitalized lease assets are stated at the present value of future minimum
      lease payments at the date of lease  inception.  Interest  incurred during
      construction  of new  facilities  or  major  additions  to  facilities  is
      capitalized  and  amortized  over the life of the asset.  Depreciation  is
      computed,   upon  the  commencement  of  gaming   operations,   using  the
      straight-line  method over the shorter of the  estimated  useful  lives or
      lease terms,  if  applicable,  of the related  assets,  which range from 5
      years for certain gaming equipment to 40 years for buildings. The costs of
      normal  maintenance and repairs are charged to expense as incurred.  Gains
      or losses on disposals are recognized as incurred.


                                                F-6
<PAGE>


      The Company  periodically  assesses  the  recoverability  of property  and
      equipment  and evaluates  such assets for  impairment  whenever  events or
      circumstances  indicate  that the  carrying  amount of an asset may not be
      recoverable.  Asset  impairment is determined to exist if estimated future
      cash flows,  undiscounted and without interest charges,  are less than the
      carrying amount.

      Other Assets - Other assets include  organizational costs amortized over a
      five-year  period.  Organizational  costs consist  primarily of legal fees
      associated with establishing the gaming licenses for business.

      Deferred  Financing  Costs  - Bond  offering  costs  and  commissions  are
      amortized over the life of the debt.  Such amortized costs are included in
      interest expense.

      Restricted  Cash and  Short-Term  Investments  -  Amounts  related  to the
      Riviera Black Hawk Casino project in Black Hawk, Colorado, were restricted
      in use to that  project  or for  the  related  13%  First  Mortgage  Notes
      interest payments.

      Fair Value Disclosure as of December 31, 2001 and 2000:

         Cash   and  Cash   Equivalents,   Short-Term   Investments   (including
         restricted),  and Accounts  Payable and Accrued Expenses - The carrying
         value of these items is a reasonable estimate of their fair value.

         Long-Term  Debt - The fair  value of the  Company's  long-term  debt is
         estimated  based on the  quoted  market  prices for the same or similar
         issues,  or on the current rates offered to the Company for debt of the
         same  remaining  maturities.  Based on the  borrowing  rates  currently
         available  to the  Company  for debt with  similar  terms  and  average
         maturities, the estimated fair value of long-term debt is approximately
         $42,723,000 and $47,547,000 in 2001 and 2000, respectively.

      Revenue Recognition:

         Casino Revenue - The Company recognizes,  as gross revenue, the net win
         from gaming  activities,  which is the  difference  between gaming wins
         after  deducting  losses and loyalty club points and  incentive  coupon
         payments paid in cash.

         Food and  Beverage  Revenue  and  Entertainment  Revenue - The  Company
         recognizes food and beverage and entertainment revenue at the time that
         goods or services are provided.

      Promotional  Allowances - Revenues  include the estimated  retail value of
      food  and   beverage  and   entertainment   provided  to  customers  on  a
      complimentary  basis.  Such  amounts  are  then  deducted  as  promotional
      allowance.  The estimated cost of providing these  promotional  allowances
      charged to the casino department was $3,575,000 and $2,639,000 in 2001 and
      2000, respectively.

      Preopening Costs - The Company recognizes preopening costs when incurred.

      Federal and State Income Taxes - The Company and its  subsidiaries  file a
      consolidated  federal tax return. The Company accounts for income taxes in
      accordance with SFAS No. 109, Accounting for Income Taxes.


                                                F-7
<PAGE>


      Riviera  Holdings  Corporation  allocated income tax expense or benefit to
      the Company as if the Company were filing separate tax returns pursuant to
      a tax  sharing  arrangement.  The  tax  sharing  agreement  provides  that
      receivables   for  tax  benefits   are  not  due  from  Riviera   Holdings
      Corporation,  and the Parent  records no liability to the  subsidiary  for
      these tax items.

      Segment  Reporting  - The  Company  is one of  the  reportable  geographic
      segments of its parent, Riviera Holdings Corporation, and markets directly
      to residents of metropolitan Denver, Colorado. Accordingly, it operates in
      a single segment.  Management believes that substantially all revenues are
      derived  from patrons  visiting  the Company from the Denver  metropolitan
      area.  Revenues from a foreign  country or region may exceed 10 percent of
      all reported segment revenues;  however,  the Company cannot identify such
      information, based upon the nature of gaming operations.

      Estimates and  Assumptions - The  preparation  of financial  statements in
      conformity with  accounting  principles  generally  accepted in the United
      States of America  requires  management to make estimates and  assumptions
      that affect the reported  amounts of assets and  liabilities,  depreciable
      lives,  disclosure of contingent assets and liabilities at the date of the
      financial  statements,  and the reported  amounts of revenues and expenses
      during the reporting period. Actual results may differ from estimates.

      Recently Adopted Accounting Standards - The Financial Accounting Standards
      Board ("FASB") issued SFAS No. 133,  Accounting for Derivatives,  which is
      effective for fiscal years  beginning  after June 15, 2000. This statement
      defines  derivatives  and  requires  qualitative   disclosure  of  certain
      financial and descriptive  information about a company's derivatives.  The
      Company  adopted  SFAS No. 133 in the quarter  ended March 31,  2001.  The
      adoption  of SFAS No. 133 had no impact on the  Company  or the  Company's
      consolidated financial statements.

      The  Emerging  Issues Task Force  ("EITF") of the  American  Institute  of
      Certified  Public  Accountants  issued  EITF  No.  00-22,  Accounting  for
      `Points' and Certain Other Timed-Based Sales Incentive Offers,  and Offers
      for Free  Products or Services to Be Delivered  in the Future,  on January
      18, 2001. EITF No. 00-22 concluded that when a company or vendor offers to
      a  customer  (a) free or  discounted  products  or  services  that will be
      delivered  (either  by the  vendor or by  another  unrelated  entity) at a
      future  date (1) as a  result  of a single  revenue  transaction  with the
      customer or (2) only if the  customer  completes  a  specified  cumulative
      level of revenue transactions with the vendor or remains a customer of the
      vendor  for a  specified  time  period  and (b) a rebate  or  refund  of a
      determinable  cash  amount  only if the  customer  completes  a  specified
      cumulative  level of  revenue  transactions  with the  vendor or remains a
      customer of the vendor for a specified time period, such rebates should be
      reported as a reduction  of  revenues.  EITF No.  00-22 was required to be
      adopted by the Company  during the first  quarter of 2001.  As a result of
      adopting  EITF No.  00-22,  the Company  reclassified  approximately  $2.6
      million of such  "Points"  from  casino  operating  expense to net against
      casino revenues for the year ended December 31, 2000.

      The EITF of the American  Institute of Certified Public Accountants issued
      EITF No.  00-14,  Accounting  for Certain Sales  Incentives,  on April 18,
      2001.  EITF No. 00-14  concluded  that when a company or vendor offers its
      customers sales incentives including discounts,  coupons, rebates and free
      products  or  services,  such sales  incentives  should be  reported  as a
      reduction of revenues.  EITF No.  00-14  concluded  that when a company or
      vendor offers its customers sales incentives including discounts, coupons,
      rebates,  and free products or services,  such sales incentives  should be
      reported  as a reduction  of  revenues.  EITF No.  00-14 is required to be
      adopted by the Company during the first quarter of 2002. Early adoption is
      permitted.  The Company chose to adopt EITF No. 00-14 in the first quarter
      of 2001.  As a result of  adopting  EITF 00-14,  the Company  reclassified
      approximately  $1.9 million of such sales incentive offers "Cash Vouchers"
      from Casino operating  expense to net against casino revenues for the year
      ended December 31, 2000.


                                                F-8
<PAGE>

      Recent Issued Accounting Standards -In July 2001, the FASB issued SFAS No.
      141, Business Combinations.  SFAS No. 141 requires the purchase method of
      accounting  for business  combinations  initiated  after June 30, 2001 and
      eliminates the pooling-of-interests method.  The Company  does not believe
      that the adoption of SFAS No. 141 will  have a  significant  impact on its
      financial statements.

      In July 2001, the FASB issued SFAS No. 142,  Goodwill and Other Intangible
      Assets,  which is effective January 1, 2002. SFAS No. 142 requires,  among
      other things,  the discontinuance of goodwill  amortization.  In addition,
      the  standard  includes  provisions  for the  reclassification  of certain
      existing  recognized  intangibles as goodwill,  reassessment of the useful
      lives of  existing  recognized  intangibles,  reclassification  of certain
      intangibles out of previously  reported  goodwill,  and  identification of
      reporting units for purposes of assessing  potential future impairments of
      goodwill.   SFAS  No.  142  also   requires  the  Company  to  complete  a
      transitional  goodwill  impairment  test  six  months  from  the  date  of
      adoption.  The Company is currently  assessing but has not yet  determined
      the impact of adopting SFAS No. 142 on its financial  position and results
      of operations.

      In June  2001,  the  FASB  issued  SFAS  No.  143,  Accounting  for  Asset
      Retirement  Obligations.  SFAS No. 143 addresses financial  accounting and
      reporting  for  obligations  associated  with the  retirement  of tangible
      long-lived  assets and the associated asset retirement costs. SFAS No. 143
      applies to all entities.  It applies to legal obligations  associated with
      the  retirement  of  long-lived  assets that result from the  acquisition,
      construction,  development,  and/or the  normal  operation  of  long-lived
      asset,  except  for  certain  obligations  of  lessees.  SFAS  No.  143 is
      effective for financial statements issued for fiscal years beginning after
      June  15,  2002.  The  Company  is  currently  assessing  but  has not yet
      determined  the impact of adopting SFAS No. 143 on its financial  position
      and results of operations.

      In  August  2001,  the  FASB  issued  SFAS  No.  144,  Accounting  for the
      Impairment  or  Disposal  of  Long-Lived  Assets.  SFAS No. 144  addresses
      financial  accounting  and  reporting  for the  impairment  or disposal of
      long-lived  assets  and  supersedes  SFAS  No.  121,  Accounting  for  the
      Impairment of Long-Lived  Assets and for Long-Lived  Assets to Be Disposed
      Of, and the accounting and reporting  provisions of Accounting  Principles
      Board Opinion No. 30,  Reporting the Results of Operations  -Reporting the
      Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual
      and Infrequently Occurring Events and Transactions,  for the disposal of a
      segment of a business (as previously  defined in that  Opinion).  SFAS No.
      144 also amends Accounting Research Board No. 51,  Consolidated  Financial
      Statements,  to eliminate the exception to consolidation  for a subsidiary
      for which  control is likely to be temporary.  The  provisions of SFAS No.
      144 are  effective  for  financial  statements  issued  for  fiscal  years
      beginning  after December 15, 2001 and for the interim period within those
      fiscal  years.  The  Company  is  currently  assessing  but  has  not  yet
      determined  the impact of adopting SFAS No. 144 on its financial  position
      and results of operations.

      Reclassifications  - Certain amounts in prior years have been reclassified
      to conform with the current year presentation. Such reclassifications have
      no effect on net income.

2.    RELATED-PARTY TRANSACTIONS

      The  Company  was formed by Riviera  Holdings  Corporation  to develop and
      operate  a casino  in Black  Hawk,  Colorado.  In  1997,  Rivera  Holdings
      Corporation contributed capital of $16.6 million to the Company, which was
      used to  purchase  the land for the  casino  site.  During  1999 and 2000,
      Riviera Holdings Corporation has made additional capital  contributions to
      the  Company  consisting  of  cash  of  $1.4  million  and  $2.6  million,
      respectively,  and allocated  capitalized interest expense of $2.0 million
      and $0.8 million,  respectively.  In 2001,  Riviera  Holdings  Corporation
      contributed an additional  $3.0 million in cash to the Company,  which was
      used to buy back Company debt.


                                                F-9
<PAGE>


      At December  31,  1998,  the Company  owed  approximately  $6.2 million to
      Riviera  Holdings  Corporation,  representing  advances  made  by  Riviera
      Holdings  Corporation  for costs related to the development of the Riviera
      Black Hawk Casino.  The advances  were repaid from the proceeds of the $45
      million bond offering discussed in Note 5.

      The Company has a management  agreement (the "Management  Agreement") with
      Riviera Gaming Management of Colorado,  Inc. (the "Manager"),  an indirect
      wholly owned  subsidiary of Riviera  Holdings  Corporation,  to manage the
      Company  for a fee.  The  management  fee  consists of a revenue fee and a
      performance  fee.  The  revenue  fee is based on one percent of net gaming
      revenues  (gross  gaming  revenues  less  complimentaries)  and is payable
      quarterly  in  arrears.  The  performance  fee is based  on the  following
      percentages of EBITDA (earnings before interest, taxes, depreciation,  and
      amortization,   whose  components  are  based  on  accounting   principles
      generally  accepted in the United  States of  America):  (1) 10 percent of
      EBITDA from $5 million to $10  million,  (2) 15 percent of EBITDA from $10
      million  to $15  million,  and (3) 20  percent  of EBITDA in excess of $15
      million.  The performance fee is based on the preceding  quarter's EBITDA,
      paid  in  quarterly  installments  subject  to  year-end  adjustment.  The
      management  fee began on February 4, 2000, the opening date of the Riviera
      Black  Hawk  Casino.  At  December  31,  2001 and 2000,  the  Company  had
      $2,031,712  and $557,000,  respectively,  in  management  fee and interest
      payable under this contract, which is included in payable to Parent.

      Charges for the cost of labor,  goods,  and  services  provided by Riviera
      Operating  Corporation  and the related  interest  totaling  approximately
      $1,303,424  and  $507,000  were  payable at  December  31,  2001 and 2000,
      respectively, and included in payable to Parent.

      If there is any default under the Management  Agreement,  the Manager will
      not be entitled to receive  management fees, but the Manager will still be
      entitled to intercompany service fees billed at cost.

3.    PROPERTY AND EQUIPMENT

      Property and equipment consist of the following at December 31 (amounts in
thousands):
<TABLE>
<CAPTION>

                                                     2001          2000

<S>                                                  <C>           <C>
       Land and improvements                       $16,204       $15,792
       Buildings and improvements                   43,758        43,752
       Equipment, furniture, and fixtures           14,270        11,898
                                                    ------        ------
       Total property and equipment                 74,232        71,442
       Accumulated depreciation                     (6,683)       (2,937)
                                                    ------        ------
       Net property and equipment                  $67,549       $68,505
                                                    ======        ======
</TABLE>

      Property  under capital leases  totaled  $9,517,000  and  $9,517,000  with
      accumulated amortization of $3,649,000 and $1,745,000 at December 31, 2001
      and 2000, respectively.

      In 2000 and 1999, $0.6 million and $3.1 million, respectively, in interest
      costs were capitalized on the construction project.


                                                F-10
<PAGE>


4.    ACCOUNTS PAYABLE AND ACCRUED EXPENSES

      Accounts payable consist of the following at December 31 (in thousands):
<TABLE>
<CAPTION>

                                                                   2001        2000

<S>                                                                <C>         <C>
       Outstanding chip and token liability                       $ 40        $ 138
       Slot club liabilities                                       516          429
       Miscellaneous gaming                                        214          290
                                                                 -----        -----
       Total liabilities related to gaming activities              770          857
       Accounts payable to vendors                               1,219        1,334
       Construction payables                                                    304
       Other                                                        46           70
                                                                 -----       ------
       Total                                                    $2,035       $2,565
                                                                 =====        =====
</TABLE>
      Accrued expenses consist of the following at December 31 (in thousands)
<TABLE>
<CAPTION>

<S>                                                               <C>          <C>
       Payroll, related payroll taxes, and employee benefits    $1,378       $1,036
       Incentive, retension and profit-sharing plans               270          144
       Other                                                     2,289        2,073
                                                                ------       ------
       Total                                                    $3,937       $3,253
                                                                ======       ======
</TABLE>

5.    LONG-TERM DEBT

      Long-term debt consists of the following at December 31 (in thousands):
<TABLE>
<CAPTION>

                                                                                     2001          2000
<S>                                                                                   <C>           <C>
        13% First Mortgage Notes maturing on June 3, 2005, bearing interest,
         payable semiannually on November 3 and June 3 of each year;
         redeemable beginning May 1, 2002 at 106.5%; 2003 at 103.25%;
         and after 2004 at 100%                                                     $34,941       $38,441

        9% Note collateralized by vehicle, payable monthly, including interest,
         maturing through October 2004                                                    8            18

        Capitalized lease obligations (Note 6)                                        6,814         8,485

        5.5% Special Improvement District Bonds - issued by the City of
         Black Hawk, Colorado, interest and principal payable
         monthly over 10 years beginning in 2000                                        960           603
                                                                                     ------        ------
        Total long-term debt                                                         42,723        47,547
        Current maturities by terms of debt                                          (1,953)       (1,770)
                                                                                     ------        ------
        Total long-term debt, net of current portion                                $40,770       $45,777
                                                                                     ======        ======
</TABLE>

                                                F-11
<PAGE>


      Maturities  of  long-term  debt for the years  ending  December  31 are as
follows (in thousands):
<TABLE>
<CAPTION>

<S>     <C>                                                     <C>
        2002                                                    $ 1,953
        2003                                                      2,148
        2004                                                      2,372
        2005                                                     35,715
        2006                                                        124
        Thereafter                                                  411
                                                               --------
        Total                                                  $ 42,723
                                                               ========
</TABLE>

      On June 3, 1999, the Company  completed a $45 million private placement of
      13% First Mortgage  Notes.  The net proceeds of the placement were used to
      fund the  completion of Riviera  Black Hawk Casino  project in Black Hawk,
      Colorado.  Riviera Holdings Corporation has not guaranteed the $45 million
      in  Riviera  Black  Hawk,  Inc.  notes  but  has  agreed  to a  "Keep-Well
      Agreement"  in  which  Riviera  Holdings  Corporation  would  pay up to $5
      million per year (or an  aggregate  limited to $10 million) to the Company
      during the first three years of the Company's operations, if (i) the $5.85
      million  minimum  interest on such notes is not paid by the Company and/or
      (ii) the amount by which the Company's cash flow is less than $9.0 million
      per year.  On February 14, 2001,  Riviera  Holdings  Corporation  advanced
      approximately  $3.1  million  to  Riviera  Black  Hawk,  Inc.  under  this
      agreement.  No  amounts  were  due  on the Keep-Well in 2001 and, based on
      current  operations, it  is not anticipated that there will be any amounts
      during 2002.  In  addition,  Riviera  Holdings  Corporation  agreed  to  a
      "Capital Completion  Commitment" of up to $10 million if the casino is not
      open  by May 31, 2000.  The opening  of the  casino  on  February  4, 2000
      satisfied the capital completion commitment,  which was released in August
      2000.  The  Company  registered  securities  identical  to  the 13%  First
      Mortgage Notes under the Securities Act of 1933, as amended. On January 4,
      2000,  the  Company  completed  an  exchange  offer  for  such  registered
      securities.

      The  notes  were  issued  at a cost in the  amount  of $3.5  million.  The
      deferred financing cost is being amortized over the life of the notes on a
      straight-line basis, which approximates the effective interest method.

      The  13%  First  Mortgage  Note   Indenture   provides  that,  in  certain
      circumstances, the Company must offer to repurchase the 13% First Mortgage
      Notes upon the  occurrence of a change of control or certain other events.
      In the event of such mandatory redemption or repurchase prior to maturity,
      the Company would be unable to pay the  principal  amount of the 13% First
      Mortgage Notes without a refinancing.

      The 13% First Mortgage Note Indenture  contains certain  covenants,  which
      limit  the  ability  of  Riviera  Black  Hawk,  Inc.  and  its  restricted
      subsidiaries,  subject to  certain  exceptions,  to: (i) incur  additional
      indebtedness;  (ii) pay dividends or other  distributions  and  repurchase
      capital  stock or other  equity  interests or  subordinated  indebtedness;
      (iii) enter into certain transactions with affiliates; (iv) create certain
      liens and sell  certain  assets;  and (v) enter into  certain  mergers and
      consolidations.  As a result of these  restrictions,  the  ability  of the
      Company to incur  additional  indebtedness  to fund  operations or to make
      capital  expenditures  is  limited.  In the  event  that  cash  flow  from
      operations is insufficient to cover cash  requirements,  the Company would
      be  required  to  curtail  or defer  certain  of its  capital  expenditure
      programs under these circumstances,  which could have an adverse effect on
      the Company's operations.  At December 31, 2001, the Company believes that
      it is in compliance with the covenants.



                                                F-12
<PAGE>

      During 2001 and 2000, the Company  purchased  $3,500,000  and  $6,559,000,
      respectively,  of the 13% First  Mortgage Notes on the open market at face
      value.

      The 5.5%  Special  Improvement  District  Bonds were issued by the City of
      Black Hawk, Colorado, in July 1998 for $2,940,000.  The proceeds were used
      for road  improvements and other  infrastructure  projects  benefiting the
      Riviera  Black Hawk Casino and another  nearby  casino.  The projects were
      substantially  completed  in  2000  at a  cost  of  $1,878,000,  including
      interest  and  reserves.  During  2001,  another  phase of the project was
      completed at a cost of $908,000. The excess proceeds have been returned to
      the  bondholders  by the City of Black  Hawk,  Colorado.  The  Company  is
      responsible  for 50 percent of the debt payable over 10 years beginning in
      2000.

6.    LEASING ACTIVITIES

      The  Company  leases  certain   equipment  under  capital  leases.   These
      agreements  have  been  capitalized  at the  present  value of the  future
      minimum lease payments at lease inception and are included in property and
      equipment. Management estimates that the fair market value of the property
      and equipment,  subject to the leases,  approximates the net present value
      of the leases.

      The  following  is a schedule by year of the minimum  rental  payments due
      under capital leases as of December 31, 2001 (in thousands).
<TABLE>
<CAPTION>

<S>     <C>                                                                            <C>
        2002                                                                           $ 2,458
        2003                                                                             2,458
        2004                                                                             2,458
        2005                                                                               876
                                                                                         -----
        Total minimum lease payments                                                     8,250
        Taxes, maintenance, and insurance                                                 (216)
        Interest portion included in payments                                           (1,220)
                                                                                        -------
        Present value of net minimum lease payments (Note 5)                           $ 6,814
                                                                                        =======
</TABLE>

      Rental  expense under  operating  leases the years ended December 31, 2001
      and 2000 was  approximately  $401,580  and  $611,661,  respectively.  Such
      leases were year to year in nature.

7.    FEDERAL INCOME TAXES

      The Company  computes  deferred  income  taxes  based upon the  difference
      between the financial  statement  and tax basis of assets and  liabilities
      using  enacted  tax rates in effect in the years in which the  differences
      are  expected to  reverse.  The Company  had no  operations  in 1999,  and
      accordingly, no income tax amounts are presented for that year.

      The effective income tax rates on income attributable to operations differ
      from the statutory  federal  income tax rates for the years ended December
      31, 2001 and 2000, as follows (in thousands):



                                                F-13
<PAGE>

<TABLE>
<CAPTION>

                                                                   2001                       2000
                                                         -----------------------  ---------------------------
                                                            Amount      Rate           Amount        Rate

       Provision (benefit) for income taxes at
<S>                                                         <C>        <C>               <C>           <C>
       federal statutory rate                               $343       35.0 %         $(1,719)      (35.0)%
       State income taxes                                     49        5.0              (246)       (5.0)
                                                            ----       ----           --------      ------
       Provision (benefit) for income taxes                 $392       40.0 %         $(1,965)      (40.0)%
                                                            ====       ====           ========      ======
</TABLE>

      Comparative  analysis of the  provision  (benefit)  for income taxes is as
follows:
<TABLE>
<CAPTION>

                                                                                      2001          2000

<S>                                                                                   <C>            <C>
        Current                                                                    $ 1,437        $ (223)
        Deferred                                                                    (1,045)       (1,742)
                                                                                     ------        ------
        Total                                                                        $ 392       $(1,965)
                                                                                     ======       =======
</TABLE>

      The tax effects of the items  composing  the  Company's  net  deferred tax
      asset consist of the following at December 31 (in thousands):
<TABLE>
<CAPTION>

                                                                                    2001          2000

        Deferred tax asset -
<S>                                                                                <C>           <C>
        Net operating loss carryforward                                            $ 1,733       $2,125
                                                                                   -------       ------
        Net deferred tax asset                                                     $ 1,733       $2,125
                                                                                   =======       ======
</TABLE>

8.    COMMITMENTS AND CONTINGENCES

      Legal  Proceedings  - Riviera  Black Hawk,  Inc. may be a party to several
      routine  lawsuits  both as  plaintiff  and as  defendant  arising from the
      normal  operations  of a  casino.  Management  does not  believe  that the
      outcome of such litigation, in the aggregate, will have a material adverse
      effect on the financial position or results of operations.

                                              ******

















                                                F-14
<PAGE>

<TABLE>
<CAPTION>

RIVIERA BLACK HAWK, INC.
(A Wholly Owned Subsidiary of Riviera Holdings Corporation)

UNAUDITED QUARTERLY INFORMATION (1)
(Amounts in Thousands, Except Per Share Data)
------------------------------------------------------------------------------------------------------------------------


                                                March 31       June 30       September 30     December 31

Year Ended December 31, 2001:
<S>                                             <C>            <C>              <C>             <C>
  Operating revenues                            $10,970        $11,990          $13,478         $12,608
  Operating income                                1,336          1,620            2,297           2,369
  (Loss) income before income taxes                (390)           (75)             701             745
  Net (loss) income                                (268)           (11)             421             447

Year Ended December 31, 2000:
  Operating revenues                            $ 7,603        $ 8,573          $ 9,494         $ 9,591
  Operating income (loss)                         1,152           (102)              54             777
  Income (loss) before income taxes                 154         (2,277)          (1,590)         (1,198)
  Net income (loss)                                  76         (1,350)            (954)           (718)

(1) The  common  stock of the  Company is not  publicly  traded;  therefore,  no
earnings per share data are presented.

</TABLE>


(17179)








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