Exhibit 10.24

                                                    Transaction No. 1203-P-01-01

                               PREFERRED MORTGAGE

                               CASINO CRUISE SHIP

                                   ROYAL STAR

     This  PREFERRED  MORTGAGE  made this ____ day of June,  2005, by Royal Star
Entertainment,  LLC, a Delaware limited liability corporation (the "Mortgagor"),
to PDS Gaming Corporation, a Minnesota corporation, (the "Mortgagee").

     WHEREAS, the Mortgagor is the sole owner of the whole of casino cruise ship
Royal Star,  St.  Vincent and the  Grenadines  Official  Number 6695 (IMO Number
8409056) (the "Vessel"),  and duly documented in the name of the Mortgagor under
the  laws and  flag of St.  Vincent  and the  Grenadines  with its home  port of
registration Kingstown, St. Vincent and the Grenadines; and

     WHEREAS,  the  Mortgagor is justly  indebted to the Mortgagee in the sum of
Twenty-Nine   Million  Four  Hundred  Fifty   Thousand  and  No/100ths   Dollars
($29,450,000.00),  and any and all interest from time to time  accruing  thereon
and to secure the payment of said debt with  interest has executed and delivered
this  preferred  mortgage (the  "Mortgage"),  the Note and the Loan and Security
Agreement  annexed  hereto  as  Exhibit  A,  which  by this  reference  are each
incorporated  herein and made a part  hereof as each may be  amended,  restated,
supplemented or otherwise  modified from time to time (hereinafter  collectively
referred to as, the "Loan Agreement"), to the Mortgagee;

     NOW, THEREFORE, THIS MORTGAGE WITNESSETH:

     That  in  consideration  of  the  premises  and  other  good  and  valuable
consideration,  the receipt and sufficiency whereof is hereby acknowledged,  and
in order  to  secure  the  payment  of the  indebtedness  evidenced  by the Loan
Agreement  according  to the terms  thereof and the payment of any  advancements
that shall hereafter be made, and the performance of and compliance with all the
covenants,  terms and conditions herein and therein, the Mortgagor does by these
presents grant, convey, mortgage, pledge, assign, transfer, set over and confirm
to the Mortgagee, its respective successors and assigns the whole of

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the Vessel,  together with all its machinery,  masts,  sails,  anchors,  cables,
rigging, tackle, apparel, fittings, tools, equipment and all other appurtenances
thereunto now, or at any time hereafter,  appertaining or belonging, whether now
owned  or  hereafter  acquired,  whether  on board  or not,  and all  additions,
improvements and replacements  hereafter made in or to the Vessel or any part or
appurtenance  thereof,  provided,  however,  that  the  Excluded  Equipment  (as
hereinafter  defined) shall not constitute a part or  appurtenance of the Vessel
and shall not be subject to the lien of this Mortgage;

     TO HAVE AND TO HOLD the same unto the Mortgagee,  its respective successors
and  assigns,  upon the terms  herein  set forth to secure the  performance  and
observance of and  compliance  with the  covenants,  terms and conditions in the
Loan Agreement and this Mortgage.

     PROVIDED,  HOWEVER,  and these presents are executed and delivered upon the
condition that if the Mortgagor,  its successors and assigns, shall pay or cause
to be paid to the party to the Loan Agreement the principal of the  indebtedness
aforesaid and interest thereon as and when the same shall become due and payable
in  accordance  with the terms of the Loan  Agreement and all other such sums as
are or may hereafter  become  secured by this  Mortgage in  accordance  with the
terms  hereof,  and the Mortgagor  shall duly perform,  observe and comply fully
with the  covenants,  terms and  conditions  in the Loan  Agreement  and in this
Mortgage,  expressed or implied,  to be performed,  observed and complied  with,
then these presents and the rights hereunder shall cease, terminate and be void;
otherwise to be and remain in full force and effect.

     IT IS HEREBY  COVENANTED,  DECLARED  AND  AGREED  that the  property  above
described  is  to  be  held  subject  to  the  further  covenants,   conditions,
provisions, terms and uses hereinafter set forth.

                                    Article 1

                        CORPORATE STATUS; ENFORCEABILITY

     The Mortgagor is a limited  liability company duly organized under the laws
of the  State of  Delaware  and is duly  authorized  to  mortgage  the  property
conveyed hereunder. All corporate action on its part, and all action on the part
of its members and managers, for the making and delivering of the Loan


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Agreement  and the  execution  of this  Mortgage  has been duly and  effectively
taken. The indebtedness  hereby secured is and will be the valid and enforceable
obligation  of the  Mortgagor  in  accordance  with its  terms,  except  as such
enforceability   may  be   limited   by   applicable   bankruptcy,   insolvency,
reorganization,   moratorium  or  similar  laws  affecting  the  enforcement  of
creditors' rights generally and by general equitable principles.

                                    Article 2

                                  VESSEL TITLE

     The  Mortgagor  lawfully  owns and is lawfully  possessed of the  mortgaged
property,  the Vessel,  and the  Mortgagor  covenants  and promises that it will
warrant and defend the title and  possession  thereto and every part thereof for
the  benefit of the  Mortgagee  against  the claims and  demands of all  persons
whomsoever;  and further warrants that the Vessel is free from all encumbrances,
claims, unpaid taxes and that there are no liens of any type, or other mortgages
on the Vessel other than the lien created by this Mortgage.

                                    Article 3

                         SATISFACTION OF LOAN AGREEMENT

     Mortgagor will pay the principal amount aforesaid,  the interest  thereupon
as  stipulated  and  fulfill,  perform,  and  observe  each and every one of the
covenants,  agreements,  and  conditions  in  this  Mortgage  and  in  the  Loan
Agreement.

                                    Article 4

             COMPLIANCE WITH LAWS OF ST. VINCENT AND THE GRENADINES

     (a)  The  Mortgagor  will  cause  this  Mortgage  to be  duly  recorded  in
accordance with the laws of St. Vincent and the Grenadines.

     (b) The Mortgagor  shall comply with and satisfy all the  provisions of the
laws of St. Vincent and the  Grenadines,  including  without  limitation the St.
Vincent and the Grenadines  Merchant  Shipping Act 1982, as amended from time to
time (the "SVG Merchant  Shipping Act"), in order to establish and maintain this
Mortgage  as a  preferred  mortgage  thereunder  upon  the  Vessel  and upon all
renewals,


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additions,  improvements and replacements made in or to the same and will comply
with all other requirements in order that the Vessel (i) may remain qualified to
engage in the trades and  activities  permitted  under the current  endorsements
listed  in the  Vessel's  Certificate  of  Registration  and  (ii)  will  not be
unreasonably exposed to penalty,  forfeiture or capture.  Mortgagor will not do,
or suffer or permit to be done, anything which can or may injuriously affect the
registration  or enrollment of the Vessel under the laws and  regulations of St.
Vincent and the Grenadines and will at all times keep the Vessel duly registered
thereunder. All property of every kind and nature which by the provisions hereof
is intended  to become  subject to the lien hereof  shall  immediately  upon the
acquisition  thereof by the  Mortgagor  and without any  further  conveyance  or
assignment, become and be subject to the lien hereof.

     (c) The Mortgagor represents that the following information required by the
Register of Ships of St.  Vincent and the  Grenadines is accurate as of the date
of this Mortgage:

        (1)  Identity of the  Vessel:  The casino  cruise  ship Royal Star,  St.
Vincent and the Grenadines Official Number 6695; IMO Number 8409056;  2040 gross
tons;  630 net tons;  length 63.14 meters;  breadth 12.80 meters;  moulded depth
4.11 meters.

        (2) Name and address of each party to this Mortgage:

     Mortgagor:

                  Royal Star Entertainment, LLC
                  c/o  Palm Beach Cruise Lines
                  One East 11th Street, Suite 500
                  Riviera Beach, Florida 33404
                  Attention:  Fran X. Murray
                  Telephone:
                  Facsimile:

     Mortgagee:

                  PDS Gaming Corporation
                  6280 Annie Oakley Drive
                  Las Vegas, Nevada 89120
                  Attention:  Simon Burgess
                  Telephone:  702-736-0700
                  Facsimile:   702-740-8696



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        (3) Maximum amount of the direct  obligation:  Twenty-Nine  Million Four
Hundred Fifty Thousand and No/100 United States Dollars  (US$29,450,000.00)  and
any and all interest from time to time accruing thereon.

        (4) Interest  Rate and Dates of Payment of Principal  and  Interest:  As
stipulated in the Loan Agreement.

        (5) Interest of the Mortgagor in the Vessel:  Sole owner of the whole of
the Vessel.

        (6) Interest Mortgaged:  The whole of the Vessel,  together with all its
machinery,  masts, sails, anchors, cables, rigging,  tackle, apparel,  fittings,
tools,  equipment  and all  other  appurtenances  thereunto  now or at any  time
hereafter,  appertaining or belonging,  whether now owned or hereafter acquired,
whether  on board  or not,  and all  additions,  improvements  and  replacements
hereafter made in or to the Vessel or any part or appurtenances thereof.

                                    Article 5

                              RETENTION OF MORTGAGE

     (a) The  Mortgagor  shall use  diligence  to keep a certified  copy of this
Mortgage,  as furnished by the Mortgagee,  on the Vessel, as required by Section
47 of the SVG Merchant Shipping Act.

     (b) The Mortgagor  will cause a notice,  reading as follows (or  containing
such additional information relating to any permitted mortgage that is placed on
Vessels as may be approved by the  Mortgagee)  printed in plan type of such size
that the  paragraph  of  reading  matter  shall  cover a space not less than six
inches wide by nine inches high, and framed,  to be placed and kept  prominently
exhibited in the chart room and in the master's cabin of the Vessel if such room
and  cabin  are  contained  in the  Vessel  and,  if  not,  where  such  notices
customarily are kept for vessels of the type of the Vessel:

                            "NOTICE OF SHIP MORTGAGE

                This  vessel  is owned  by  Royal  Star  Entertainment,  LLC,  a
        Delaware  limited  liability  company,  and is  covered  by a  Preferred
        Mortgage in favor of PDS Gaming Corporation,  a Minnesota corporation, a
        certified  copy of which  mortgage  is kept with this  vessel's  papers.
        Under the terms of said mortgage,  neither the owner, any charterer, the
        master or agent of this


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        vessel nor any other person has any right, power or authority to create,
        incur,  or  permit to be placed or  imposed  upon this  vessel  any lien
        whatsoever,  other than  liens for wages of a  stevedore  when  employed
        directly  by the owner,  operator,  master or agent of the  vessel,  for
        wages of the crew in  respect  of this  vessel,  general  average or for
        salvage (including  contract salvage),  liens fully covered by insurance
        and any deductible  applicable thereto, or, to the extent they are liens
        subordinate to the liens of the said  mortgage,  other liens incident to
        current operations or for repairs in respect of this vessel."

     (c)  The  Mortgagor  will  not  transfer  or  change  the  flag  or port of
documentation of the Vessel without having obtained the prior written consent of
the  Mortgagee,  and any such  written  consent to any one transfer or change of
flag or port of  documentation  shall  not be  construed  to be a waiver of this
provision with respect to any subsequent  proposed transfer or change of flag or
port of documentation.

                                    Article 6

                                    INSURANCE

     (a) The Mortgagor shall, at its own expense, cause the Vessel to be insured
in an amount that shall be at least equal to its full  commercial  value but not
less than 100% of the amount  remaining unpaid on said principal sum of the Note
annexed hereto as Exhibit A together with accrued interest. Such insurance shall
cover marine  perils,  on hull and  machinery,  and shall be  maintained  in the
standard  forms  available in the  American or British  insurance  markets.  The
Mortgagor shall cause to be maintained  protection and indemnity (P&I) insurance
or liability  insurance in an amount at least equal to the full commercial value
of the Vessel. Mortgagor also agrees to carry P&I Pollution coverage, as well as
any  additional  coverage  necessary to meet federal or state proof of financial
responsibility requirements, if required.

     (b) The Mortgagor shall not do any act or voluntarily  suffer or permit any
act to be  done  whereby  any  insurance  is or may be  suspended,  impaired  or
defeated  and shall not suffer or permit the Vessel to engage in any voyage,  or
in any operation not permitted under the policy or policies of


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insurance in effect, unless and until the Mortgagor shall first cover the Vessel
to the amount herein  provided for by insurance,  satisfactory  to the Mortgagee
for such voyage, or operation of the Vessel.

     (c) In the event of any actual,  constructive or compromised  total loss of
the Vessel,  such loss shall not be adjusted  or  compromised  without the prior
written  consent of the Mortgagee,  and all insurance or other payments for such
shall be paid to the Mortgagor  and applied by the Mortgagor in accordance  with
the terms of the Loan Agreement.

     (d) In the event that any claim or lien is asserted  against the Vessel for
loss, damage or expense which is covered by insurance required hereunder, and it
is necessary  for the  Mortgagor  to obtain a bond or supply  other  security to
prevent  arrest of the Vessel or to release the Vessel from arrest on account of
such claim or lien,  the  Mortgagee,  on request of the  Mortgagor or its agent,
may, in the sole  discretion  of the  Mortgagee,  assign to any person,  firm or
corporation  executing a surety or guarantee bond or other  agreement to save or
release  the Vessel  from such  arrest,  all right,  title and  interest  of the
Mortgagee in and to said  insurance  covering said loss,  damage or expense,  as
collateral  security to  indemnify  such  person,  firm or  corporation  against
liability under said bond or other agreement.

     (e) If  requested by the  Mortgagee at any time and from time to time,  the
Mortgagor  will deliver to the  Mortgagee  copies of all cover  notes,  binders,
policies  and   certificates   of  membership   in   protection   and  indemnity
associations,  and all endorsements and riders amendatory thereof, in respect of
insurance maintained in connection with the Vessel.

     (f) All insurance required by this Article 6, except for insurance covering
the  Mortgagor's  liability  to the crew of the  Vessel,  must  name each of the
Mortgagee  and PDS Funding  2004-A,  LLC as an additional  insured,  but without
liability for premiums, club calls, assessments,  warranties or representations,
and,  upon and after the  occurrence  of any default (as described in Article 12
hereof),  all amounts of whatsoever  nature  payable under any insurance must be
payable to the Mortgagee and PDS Funding 2004-A,  LLC for distribution  first in
respect of the obligations  owing under the Loan Agreement and thereafter to the
Mortgagor or others as interest may appear. Mortgagor shall deliver to Mortgagee


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certificates of insurance  together with all necessary  endorsements  evidencing
that Mortgagee has been named an additional insured.

                                    Article 7

                                      LIENS

     (a) In due course,  and in any event within thirty (30) days after the same
becomes due and payable,  the  Mortgagor  will pay or cause to be  discharged or
make  adequate  provision  for the payment or discharge of all claims or demands
which,  if not paid or  discharged,  might  result in the creation of a security
interest,  lien,  encumbrance  or  charge  against  the  Vessel  or  any  income
therefrom, and will cause the Vessel to be released or discharged from each such
security interest, lien, encumbrance or charge therefor.

     (b) If a libel is filed upon the Vessel or if the Vessel shall be arrested,
seized,  sequestered  or taken into custody by virtue of any  proceeding  in any
court or tribunal or by any  government or other  authority,  the Mortgagor will
promptly notify the Mortgagee  thereof,  and within fifteen (15) days after such
libel,  arrest,  seizure,  sequestration,  or taking into custody will cause the
Vessel to be released and will promptly notify the Mortgagee of such release.

     (c) Neither the  Mortgagor,  any charterer or any other person has or shall
have any right,  power or authority  to create,  incur or permit to be placed or
imposed  or  continued  upon the  Vessel  any  lien  whatsoever  (including  any
encumbrance or security  interest)  other than the lien created by this Mortgage
and liens for crew's wages or salvage or otherwise  arising in the normal course
of trading and being regularly settled.

                                    Article 8

                           VESSEL MAINTENANCE; ACCESS

     (a) At all times the  Mortgagor  shall  exercise due diligence to cause the
Vessel to be maintained and preserved in as good condition,  working order,  and
repair, as at the date of the execution of this Mortgage, ordinary wear and tear
and depreciation excepted. The Mortgagor agrees, following


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request by the Mortgagee, to give the Mortgagee at least ten (10) days notice of
actual  date and place of any survey of the  Vessel in order that the  Mortgagee
may have representatives present if desired.

     (b) The Mortgagor will at all reasonable  times afford the Mortgagee or its
authorized  representatives  full and  complete  access  to the  Vessel  for the
purpose of inspecting the Vessel and her cargo and papers and, at the request of
the Mortgagee,  the Mortgagor will deliver for inspection  copies of any and all
contracts and documents  relating to the Vessel,  whether on board or not. Until
an Event of Default has occurred and is continuing, any such inspection shall be
conducted at a time and in a manner which does not interfere  with the operation
of the Vessel and in the ordinary course of the Mortgagor's business.

                                    Article 9

                                      TAXES

     The Mortgagor  shall pay and  discharge,  when due and payable from time to
time, all taxes,  assessments,  penalties, and governmental charges imposed upon
the Vessel.

                                   Article 10

                                   POSSESSION

     Subject to Article 12, the  Mortgagor  may retain and possess the Vessel or
charter the Vessel as permitted by law; provided,  however,  the Mortgagor shall
not sell, mortgage,  transfer nor change the Vessel's flag or otherwise encumber
the Vessel, except as provided by Article 7 hereof, without the written approval
of the Mortgagee.

                                   Article 11

                           REQUISITION OF TITLE OR USE

     In the event that the title to or  ownership  of the Vessel,  or the use of
the Vessel,  shall be requisitioned,  purchased or taken by, or the Vessel shall
be seized by or forfeited to, any  government of any country or any  department,
agency or  representative  thereof,  pursuant  to any  present  or  future  law,
proclamation,  decree,  order or  otherwise  or by any other  person or persons,
whether or not acting under color of governmental  authority,  the compensation,
purchase price, reimbursement or award for such


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requisition,  purchase,  seizure,  forfeiture  or other  taking  of such  title,
ownership or use shall  forthwith be and become  payable to the  Mortgagee.  The
Mortgagor  hereby  constitutes  and appoints the  Mortgagee  its true and lawful
attorney, for it and in its name, place and stead, from and after a requisition,
purchase,  seizure,  forfeiture,  or other taking of such title,  and during the
continuance  thereof, to collect,  receipt for,  acknowledge the payment of, sue
for and execute any  documentation  or writing that may be necessary or required
in order to obtain payment of said compensation,  purchase price,  reimbursement
or award,  giving and granting to said  attorney  full power and authority to do
and perform every act and thing whatsoever  requisite or necessary to be done in
or about the  premises  as fully and to all  intents  and  purposes  as it,  the
Mortgagor,  might or could do if personally  present at the doing thereof,  with
full power of  substitution,  hereby  ratifying and confirming all that its said
attorney  or  substitute  shall  do or cause to be done by  virtue  hereof.  The
Mortgagor shall promptly execute and deliver to the Mortgagee such documents and
shall  promptly do and perform such acts as in the opinion of the  Mortgagee may
be necessary or useful to facilitate or expedite the collection by the Mortgagee
of such compensation, purchase price, reimbursement or award.

                                   Article 12

                                     DEFAULT

     (a) In the event of (i) the  Mortgagor's  default  of prompt  and  punctual
payment when due in the payment of any  interest or principal  sum stated in the
Note,  or (ii) any other  "Event of  Default"  under and as  defined in the Loan
Agreement  shall have  occurred and be  continuing,  then in every such case the
entire  unpaid  principal of and interest on the Loan  Agreement may be declared
immediately due and payable at the Mortgagee's  option without prior notice.  If
such  sums are not paid  forthwith,  the  Mortgagee,  at its  sole  option,  may
foreclose or enforce  this  Mortgage  lien by suit in rem in  admiralty  and the
Mortgagee shall be entitled to the appointment of a receiver or receivers of the
Vessel and mortgaged  property and of the revenues thereof.  The Mortgagor shall
execute any  documents  requested by the  Mortgagee to expedite the  foreclosure
proceedings. The Mortgagee shall have the right to bid or purchase the Vessel in
the foreclosure proceedings.


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     (b) In case the Mortgagee  shall have  proceeded to enforce any right under
this Mortgage by foreclosure and such proceedings  shall have been  discontinued
or  abandoned  for any reason,  or shall have been  determined  adversely to the
Mortgagee,  then the  Mortgagor  and the  Mortgagee  shall be  restored to their
former positions.

     (c) No delay or  omission of the  Mortgagee  in the  exercise  any right or
power  accruing upon any default shall impair any such right or power,  or shall
be  construed to be a waiver of any such default or  acquiescence  therein;  and
every power and remedy given  herein may be  exercised  from time to time and as
often as may be deemed expedient.

     (d) The remedies in favor of the Mortgagee provided for herein shall not be
construed  to preclude  the  Mortgagee  in the event of default  hereunder  from
enforcing any other appropriate remedies against the Mortgagor or the Vessel, or
from  proceeding by suit as the Mortgagee may consider  advisable to enforce the
payment or performance of any obligation secured hereby.

                                   Article 13

                           ALLOCATION OF SALE PROCEEDS

     Proceeds from any sale shall be applied as follows:

     FIRST.  The payment of all  expenses and  charges,  including  the cost and
expenses of any sale,  the  expenses of any  retaking,  attorneys'  fees,  court
costs,  and any other  expenses or advances made or incurred by the Mortgagee in
the protection of its rights or the pursuance of its remedies hereunder.

     SECOND.  The payment of any damages or injuries  sustained by the Mortgagee
occasioned by  non-compliance  by the Mortgagor with the terms and provisions of
this Mortgage,  and to furnish  indemnity in the proper amount against any other
liens  or  other  encumbrances  which  have  or may  have  priority  over  those
established by this Mortgage.

     THIRD.  Payment of the unpaid  balance of principal and interest  under the
terms of the Loan Agreement, and any advances, if any, made by the Mortgagee.

     FOURTH. Payment of any other obligations under the Loan Agreement.


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     FIFTH.  Payment of any surplus to the Mortgagor.  If insufficient funds are
realized to satisfy the sums set out above,  the Mortgagor  shall  forthwith pay
the Mortgagee the amount of such deficiency.

     In the event the proceeds and the net earnings  referred to in this Article
should  be  insufficient  to pay the  sum  total  of the  amounts  specified  in
paragraphs First through Fourth above, then the Mortgagee, as mortgage creditor,
shall have the right to collect and to receive from the  Mortgagor,  or from any
other person or persons who may be chargeable in respect thereof, such amount as
will fully pay any remaining deficiency with respect to the amounts specified in
paragraphs First through Fourth above.

                                   Article 14

            PREFERRED MORTGAGE STATUS; FILING OF FINANCING STATEMENTS

     No provision of this Mortgage shall be deemed to constitute a waiver by the
Mortgagee of the  preferred  status  hereof,  and any provision of this Mortgage
which would  otherwise  constitute  such a waiver  shall to such extent be of no
force or effect.  The Mortgagor hereby  irrevocably  authorizes the Mortgagee to
file and record financing  statements  under the Uniform  Commercial Code in any
jurisdiction  where  the same may be in force or under  any  legislation  having
similar effect for the purpose of perfecting or continuing the perfection of the
security  interests  granted by the  Mortgagor to the Mortgagee  herein  without
obtaining  the  signature  of  the  Mortgagor  thereto.   The  Mortgagor  hereby
irrevocably  authorizes the Mortgagee to execute any such financing statement or
similar document in the name of the Mortgagor. Notwithstanding any provisions of
this Mortgage or the Loan Agreement to the contrary, the preferred mortgage lien
imposed by this Mortgage shall in no event include any gaming equipment owned or
leased  by  Mortgagor  and  placed on the  Vessel  (the  "Excluded  Equipment");
provided,  however,  Mortgagee does not otherwise possess a security interest in
any such equipment created by separate agreement between Mortgagor and Mortgagee
or by the proper filing and perfection of a UCC-1 financing statement.



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                                   Article 15

                                    ADVANCES

     Upon written  request from the Mortgagee,  the Mortgagor will reimburse the
Mortgagee  promptly for any and all reasonable  expenditures which the Mortgagee
may from time to time make,  lay out or expend in providing  such  protection in
respect of insurance,  discharge or purchase of liens, taxes, dues, assessments,
governmental charges, fines and penalties lawfully imposed, repairs,  attorney's
fees,  necessary  translation  fees for documents  made in a language other than
English,  and other matters as the Mortgagor is obligated herein to provide, but
fails to provide.  Such  obligation  of the Mortgagor to reimburse the Mortgagee
shall be an  additional  indebtedness  due from the  Mortgagor,  secured by this
Mortgage, and shall be payable by the Mortgagor on demand. The Mortgagee, though
privileged  to do so, shall be under no  obligation to the Mortgagor to make any
such  expenditures,  nor shall the making  thereof  relieve the Mortgagor of any
default in that respect.

                                   Article 16

                                 OTHER DOCUMENTS

     In the event this Mortgage or the Loan Agreement or any provisions  thereof
are held  invalid,  in whole or in part  under any  present or future law or any
decisions of any court having jurisdiction  thereof, the Mortgagor shall execute
such other or further instruments as in the opinion of counsel for the Mortgagee
will carry out the true  intent and spirit of this  Mortgage.  From time to time
the Mortgagor shall execute such further assurances as in the opinion of counsel
for the  Mortgagee  may be required  more  effectually  to subject the  property
herein  mortgaged or intended to be  mortgaged to the payment of said  principal
sum required under the terms of the Loan Agreement.  Invalidity of any provision
hereof shall not impair or defeat the provisions hereof which are valid.

                                   Article 17

                                     NOTICES

     All  notices and other  communications  required  or  permitted  under this
Mortgage  shall be in  writing,  shall be sent to the  address of the  recipient
listed in Article 4(c) hereof by personal delivery,


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<PAGE>




telefax,  overnight mail or certified mail and shall be effective when received.
Any address for  notices may be changed by written  notice  thereof to the other
parties as provided in this Article.

                                   Article 18

                SUCCESSORS AND ASSIGNS; THIRD PARTY BENEFICIARIES

     All the covenants, stipulations, and agreements in this Mortgage shall bind
and inure to the benefit of the Mortgagor,  its successors and assigns,  and the
Mortgagee,  its successors and assigns.  Mortgagor may not assign its rights and
obligations hereunder without prior written consent of Mortgagee.  Mortgagee may
assign its rights and  obligations  hereunder  without prior written  consent of
Mortgagor, including but not limited to, to PDS Funding 2004-A, LLC.

                                   Article 19

                                  GOVERNING LAW

     This Mortgage and all the rights and  obligations of the parties  hereunder
and their  successors  and assigns shall be governed by the laws of St.  Vincent
and the Grenadines,  including any treaties and conventions to which St. Vincent
and the  Grenadines is a signatory and without  giving effect to its conflict of
law rules. Each of the parties  irrevocably and  unconditionally (i) agrees that
any legal suit, action or proceeding brought by a party hereto arising out of or
based upon this Mortgage,  except for an in rem action against the Vessel, shall
exclusively  be brought in the United  States  District  Court  located in Clark
County, Nevada ("District of Nevada"), (ii) waives, to the fullest extent it may
effectively  do so,  any  objection  which it may now or  hereafter  have to the
laying of venue of any such  proceeding  brought in the District of Nevada,  and
any claim that any such action or  proceeding  brought in the District of Nevada
has been  brought in an  inconvenient  forum,  (iii)  submits  to the  exclusive
jurisdiction  of the District of Nevada in any suit,  action or proceeding,  and
(iv)  agrees  that the  losing  party  shall  pay to the  prevailing  party  the
reasonable  attorneys' fees and reasonable  expenses  incurred by the prevailing
party  in  such  action.  If  for  any  reason  the  District  of  Nevada  lacks
jurisdiction over a matter arising out of or based upon this Mortgage, excluding
any in rem action against the Vessel, the District Court for the State of Nevada
in Clark  County,  Nevada  ("Nevada  State  Court")  shall  then have  exclusive
jurisdiction and all


                                       14

<PAGE>




other  provisions  of this Article  shall remain valid and  enforceable  in such
court.  Mortgagor  covenants  and agrees that,  so long as it shall be obligated
under this  Mortgage,  it shall  maintain an office in Palm  Beach,  Florida and
agrees that in any action or proceeding  brought  against it service may be made
by mailing a copy of any  summons or other  legal  process in any such action or
proceeding to it at such office.  Mortgagor  shall promptly notify the Mortgagee
of any change in such office.

                                   Article 20

                                  COUNTERPARTS

     This Mortgage may be executed in any number of counterparts,  each of which
shall be an original,  but such counterparts  shall together  constitute but one
and the same instrument.

                                   Article 21

                                   ACCEPTANCE

     The Mortgagee  declares that it accepts the mortgage  hereby created in its
favor under the terms above set forth.

                                   Article 22

                            INFORMATION FOR RECORDING

     For the purposes of recording this Mortgage as required by Section 43(1) of
the SVG Merchant  Shipping Act, the total amount of this Mortgage is Twenty-Nine
Million  Four  Hundred  Fifty   Thousand  and  No/100   United  States   Dollars
(US$29,450,000.00) and interest and performance of mortgage covenants. The final
maturity  date of principal  and interest is [August 1, 2009] and the  discharge
amount is the same as the total amount.

                          [SIGNATURE ON FOLLOWING PAGE]




                                       15

<PAGE>




         IN WITNESS WHEREOF, the Mortgagor has executed this Mortgage the day
and year first above written.

                                           MORTGAGOR

                                           ROYAL STAR ENTERTAINMENT, LLC

                                           By:
                                              ----------------------------
                                           Title:
                                                 -------------------------

                                 ACKNOWLEDGMENT

STATE OF FLORIDA                            ss.
                                            ss.  ss.
COUNTY OF                                   ss.

         On this _________ day of _______________________, 2005, before me the
undersigned Notary Public, personally appeared
________________________________________________, personally known to me (or
proved to me on the basis of satisfactory evidence), who being duly sworn, did
depose and say that he resides at ______________________________________, that
he is the ___________ of Royal Star Entertainment, LLC, the limited liability
corporation described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such seal; that it was so affixed by authority of the Member(s) of said company;
and that he signed his name thereto by like order.

                                           Notary Public in and for Florida
                                           My Commission Expires:
                                                                -----------

[Notarial Seal]



                                       16

<PAGE>




                                           MORTGAGEE'S ACCEPTANCE
                                           ----------------------
                                           PDS GAMING CORPORATION

                                           By:
                                              --------------------
                                           Title:
                                                 -----------------
                                           ATTEST:
                                           By:
                                              --------------------

                                 ACKNOWLEDGMENT

STATE OF NEVADA                             ss.
                                            ss.  ss.
COUNTY OF                                   ss.
------------------------------------

         On this _________ day of _______________________, 2005, before me the
undersigned Notary Public, personally appeared
________________________________________________, personally known to me (or
proved to me on the basis of satisfactory evidence), who being duly sworn, did
depose and say that he resides at ______________________________________, that
he is the ___________ of PDS Gaming Corporation, the corporation described in
and which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such seal; that it was
so affixed by authority of the Board of Directors of said company; and that he
signed his name thereto by like order.

                                           Notary Public in and for Nevada
                                           My Commission Expires:
                                                                 ---------

[Notarial Seal]


                                       17