SETTLEMENT, USE AND MANAGEMENT AGREEMENT AND DNR PERMIT


          THIS SETTLEMENT, USE AND MANAGEMENT AGREEMENT AND DNR
PERMIT (this "Agreement") is made as of May 15, 1995, by and
between Koch FUELS, INC., a Delaware corporation having its
principal place of business at 4111 E. 37th Street North,
Wichita, KS 67220, doing business as a private corporation in
Iowa (hereinafter called "Koch") and the STATE OF IOWA
(hereinafter called the "State"), acting by and through the IOWA
DEPARTMENT OF NATURAL RESOURCES (hereinafter called the "DNR").


                            RECITALS

WHEREAS, Koch was provided a Special Warranty Deed dated June 2,
1987, whereby it purportedly received fee title to parcels of
land in Pottawattamie County, Iowa, identified as "Parcel "A",
Parcel "B" and Parcel "C" in Exhibit "A" hereto (hereinafter
referred to as the "Real Estate");

WHEREAS, the Real Estate is riparian land with one of its
contiguous borders being the Missouri River;

WHEREAS, the State has claimed ownership to portions of the Real
Estate  under the laws of the State, as applied by the courts of
the State and interpreted by the DNR, based on a claim that such
portions of the Real Estate formed by accretion to the bed of a
navigable river within the State;

WHEREAS, Koch disputes the State's claim;

WHEREAS, portions of the Real Estate were substantially developed
for industrial purposes before Koch purchased the Real Estate and
before the State made any claim of ownership as to the Real
Estate;

WHEREAS, a good faith dispute exists between the DNR and Koch as
to the boundaries between the portion of the Real Estate owned by
Koch and the portion of the Real Estate owned by the State;

WHEREAS, Koch has filed an action in the Iowa District Court for
Pottawattamie County at Council Bluffs (hereinafter referred to
as the "District Court"), [insert Case Number], to quiet title to
the Real Estate in Koch (hereinafter referred to as the "Quiet
Title Action");

WHEREAS, the Real Estate is neither a park, a forest, a fish and
wildlife area, nor a public recreation area;

WHEREAS, the Iowa Racing & Gaming Commission, an agency of the
State, has determined that the people of the State will benefit
if portions of the Real Estate are developed as a commercial
recreational complex featuring a casino gambling boat and related
appurtenances and facilities including, but not limited to, the
following: one or more hotels, one or more shopping areas,
docking and terminal facilities, parking areas, driveways and
walkways;

WHEREAS, members of the public have made little, if any, use of
the Real Estate for access to the Missouri River for recreational
purposes;

WHEREAS, Koch has proposed to pay a one-time payment of Five
Hundred Fifty-Six Thousand Five Hundred Fifty-Five Dollars
($556,555) (hereinafter referred to as the "Monetary
Consideration") to an escrow agent, such Monetary Consideration
to be paid by the escrow agent as directed by the DNR, but only
to sellers of privately-owned real estate pursuant to agreements
with the DNR, for State acquisition of privately-owned real
estate which abuts the Missouri River, or adjoins State-owned
real estate which abuts the Missouri River, or to a third party
whose land is acquired to qualify such purchase agreement as an
agreement for exchange of like-kind real estate, such acquired
real estate to be held by the State in trust and maintained and
managed by the DNR or another public agency for conservation
purposes and for the benefit of the public;

WHEREAS, the Monetary Consideration will enable the DNR to
acquire other real estate substantially expanding public
recreational access to the Missouri River;

WHEREAS, Koch or its assignee propose to make certain
improvements to the portion of the Real Estate identified as
"Parcel "3"" on the diagram attached hereto as Exhibit "B"
(hereinafter referred to as the "Premises") that will facilitate
public access to and along the existing bank of the Missouri
River;

WHEREAS, after the expiration of the term of years set forth
herein for control by Koch or its assignee of the Premises (and
any renewals which hereafter may be negotiated) said riparian
parcel will be available for public recreational access to the
Missouri River free of any impediments which would otherwise
exist by virtue of Koch's claim to the Real Estate; and

WHEREAS, Koch and the State desire to settle the Quiet Title
Action and their dispute as to the ownership of the Real Estate
and to provide for the development of the Real Estate for
recreational purposes.


                           AGREEMENT

NOW THEREFORE, in consideration of the mutual promises of the
parties hereto and other valuable consideration, the receipt of
which is hereby acknowledged, in order to resolve the disputed
claims of the parties, and, pursuant to the authority granted to
the DNR under Chapter 28E, Section 461A.4 and Section 461A.24 of
the 1995 Code of Iowa, Koch and the DNR agree as follows:

1.   State Real Estate.  In settlement of the Quiet Title Action
     and the disputed claims with respect to the Real Estate and
     in consideration of the Right to Use (as hereinafter
     defined), Koch hereby disclaims all of its interest in and
     acknowledges the State's title to the Premises, and Koch or
     its assignee shall execute and deliver to the DNR a
     quitclaim deed conveying all of its right, title and
     interest, if any, in and to the Premises to the State
     (subject to the Right to Use described below) upon the later
     of (i) approval of this Agreement by the District Court,
     (ii) approval of the Survey (described below) by the DNR and
     Koch, or (iii) payment of the Monetary Consideration into
     the escrow created pursuant to the terms of an escrow
     agreement in the form of Exhibit "C" attached hereto
     (hereinafter referred to as the "Escrow Agreement").

2.   Koch Real Estate.  In settlement of the Quiet Title Action
     and the disputed claims with respect to the Real Estate, and
     pursuant to Section 461A.24 of the Iowa Code, the DNR, on
     behalf of the State, hereby disclaims all of the State's
     interest in and acknowledges Koch's title to all those
     portions of the Real Estate not identified as "Parcel "3""
     on the diagram attached hereto as Exhibit "B" (hereinafter
     referred to as "Koch's Property") and, the DNR shall execute
     and deliver to Koch a boundary line agreement in the form
     attached hereto as Exhibit "D" and an Affidavit Explanatory
     of Title and Disclaimer of Interest in Real Estate in the
     form attached hereto as Exhibit "E," disclaiming all of its
     right, title and interest, if any, in Koch's Property to
     Koch, upon the later of (i) approval of this Agreement by
     the District Court (ii) approval of the Survey by the DNR
     and Koch or (iii) payment of the Monetary Consideration into
     escrow pursuant to the terms of the Escrow Agreement.  The
     State, through the appropriate State agency or authority
     shall provide Koch such other quitclaim deeds, disclaimers,
     affidavits, or other documentation as Koch shall reasonably
     request to evidence that it has fee title, including
     riparian rights, to Koch's Property free from any
     enforceable claims of the State with respect to title to or
     ownership of Koch's Property, specifically including, but
     not limited to, claims resulting from accretions from the
     bed of the Missouri River.

3.   Right to Use Premises.  Koch's prospective assignee
     anticipates developing the Premises with commercial or
     recreational facilities (which may include one or more
     shopping areas) that would be compatible with its adjoining
     casino gambling facilities.  In settlement of the Quiet
     Title Action and the disputed claims with respect to the
     Real Estate, the DNR, on behalf of the State, hereby grants
     to Koch and its assignees, and their successors, assignees
     and mortgagees, employees, designees, agents, customers,
     licensees, and invitees the right to use (hereinafter
     referred to as the "Right to Use") the Premises for a term
     of fifty (50) years for commercial or recreational purposes
     including the development, construction, operation,
     management and use of retail facilities, hotel facilities,
     recreational vehicle parks, parking areas, and other uses
     compatible or complementary to the foregoing or to the
     operation of a gaming facility on adjoining property, all in
     accordance with applicable law.  The Right to Use shall also
     include the right of Koch or its successor or assignee to
     grant to any other persons or entities, including any
     political subdivision of the State, the right to use all or
     any portion of the Premises for any or all of the uses
     otherwise permitted under the Right to Use.  Public access
     consistent with the public trust doctrine shall be
     permitted;
     provided, however, nondiscriminatory access restrictions are
     permitted where necessary for safety or reasonable
     commercial or operational considerations.

4.   Public Trust Improvements.  Koch or its assignees shall
     construct the improvements described on Exhibit "F,"
     attached hereto and incorporated herein by this reference,
     on the Real Estate and such improvements shall be reasonably
     available for use by the general public during the term of
     the Right to Use.

5.   Settlement of Quiet Title Action.  The Agreement is intended
     to be a full and complete settlement of the Quiet Title
     Action and of the claims of State and Koch with respect to
     ownership of the Real Property.  The approval of this
     Agreement by the District Court, the Iowa Natural Resource
     Commission, and the Iowa State Executive Council shall be a
     condition precedent to its effectiveness.  Each of Koch and
     the DNR agrees to use its best efforts to obtain the
     approval of this Agreement by the Iowa State Executive
     Council and the District Court.

6.   Consideration.  As additional consideration for the State's
     settling the Quiet Title Action and the disputed claims with
     respect to the Real Estate and granting the Right to Use to
     Koch, Koch shall pay the Monetary Consideration into the
     escrow created pursuant to the terms of the Escrow
     Agreement.  DNR shall use the Monetary Consideration to
     purchase for the public privately-owned real estate which
     abuts the Missouri River or adjoins State-owned real estate
     which abuts the Missouri River.  The DNR shall cause the
     escrow agent to pay the Monetary Consideration at the
     direction of the DNR, but only to sellers of such privately-
     owned real estate pursuant to written purchase agreements
     between the DNR and such sellers or to a third party whose
     land is acquired to qualify such purchase agreement as an
     agreement for exchange of like-kind real estate.  The State
     shall hold such acquired real estate in trust.  The DNR or
     another public agency shall maintain and manage the acquired
     real estate for conservation purposes and for the benefit of
     the public.  The acquired real estate shall remain available
     for use by the general public for all purposes consistent
     with the public trust doctrine.  The DNR has determined that
     the present value of the foregoing payment exceeds the
     present value of the aggregate amount that Koch might
     otherwise be required to pay to the DNR as consideration for
     the Right to Use under the DNR's Rule 571, Chapter 18.  As
     such, the foregoing payment shall be in lieu of, and in
     complete and total satisfaction of, any payment that Koch
     might otherwise be required to pay to the DNR as
     consideration for the Right to Use under the DNR's Rule 571,
     Chapter 18.

7.   DNR Permit; Improvements.  Pursuant to Section 461A.4 of the
     1995 Code of Iowa, the DNR has issued Construction Permit
     9538, dated April 19, 1995 (hereinafter referred to as the
     "Existing Permit"), which authorizes inter alia excavation
     of the boat mooring area and the construction of certain
     improvements on the Koch Property.  Paragraph 3 of the
     Existing Permit which conditions the Existing Permit on,
     inter alia, the approval "of a long term use agreement
     covering the land on which the construction will occur" is
     hereby deemed satisfied upon the date when this Agreement
     becomes effective.  Neither Koch nor its assignee shall
     commence construction improvements on any portion of the
     Premises until the DNR shall have granted a
     permit under Section 461A.4 of the Iowa Code for such
     improvements.  The DNR shall not unreasonably withhold or
     delay the approval and issuance of such permits.  In
     determining the reasonableness of the exercise of the DNR's
     permitting authority, due consideration shall be given to
     the DNR's grant of the Right to Use as consideration for the
     covenants and agreements of Koch set forth herein, including
     the payment of the Monetary Consideration.

8.   Permits.  Except as set forth in Section 7 hereof, Koch or
     its assignees shall be solely responsible for obtaining any
     and all necessary permits and authorizations for activities
     including, without limitation, construction permits, casino
     gambling boat licensing, and Section 404 permits.

9.   Boundary Management.  Koch and its assignees shall be
     responsible for addressing any boundary problems affecting
     title to the Premises during the term of the Right to Use.
     Should any dispute arise during the term of the Right to Use
     with respect to the boundary between the Premises and any
     other property, Koch shall notify DNR and Koch and the DNR
     shall cooperate in resolving such dispute.

10.  DNR's Use of Premises.  The DNR reserves the right to enter
     upon the Premises at any time for any purpose in connection
     with programs of the DNR and temporarily use the Premises in
     such manner as does not materially interfere with the Right
     to Use.

11.  Expenditure of Funds.  Nothing in this Agreement shall
     obligate or bind either party to expend funds in excess of
     the funds available to such party.

12.  Indemnification.  Neither the State, nor any agency,
     official or employee thereof, shall be responsible for
     accidents of any nature which may occur within or upon the
     Premises.  Koch and its successors and assignees hereby
     agree to indemnify and hold harmless the State, its
     agencies, officials and employees (collectively, the
     "Indemnified Parties") from and against all liability, loss,
     damage or expense (hereinafter collectively referred to as
     "Loss") which may arise in consequence of the State's entry
     into this agreement delegating authority to develop,
     maintain and manage the Premises.  However, neither Koch nor
     its assignees shall have any duty to indemnify the
     Indemnified Parties or hold the Indemnified Parties harmless
     from Loss arising from the acts of officials, employees or
     agents of the State while on the Premises.

13.  Insurance.  Koch or its assignee, shall maintain in force
     (i) Commercial General Liability Insurance naming the State
     as an additional insured with a minimum combined single
     limit of $1,000,000 per occurrence with umbrella/excess
     coverage of not less than $4,000,000 for Bodily Injury and
     Property Damage and (ii) statutorily required Workers'
     Compensation insurance.  During the term of the Right to
     Use, Koch or its assignee shall also maintain on file with
     the State a current certificate of insurance certifying the
     insurance coverages set forth above.

14.  Term of Agreement.  This Agreement and all obligations of
     the parties set forth herein, shall become effective only
     upon (i) the payment of the Monetary
     Consideration as set forth above, (ii) the duly authorized
     signature of the Director of the DNR and (iii) the closing
     of the sale or other transfer of Koch's interest in the Real
     Estate to Ameristar Casinos, Inc., a Nevada corporation or
     its designee (hereinafter called "Ameristar").  Unless and
     until Koch sells or transfers its interest in the Real
     Estate to Ameristar, the representations, recitals,
     covenants and other provisions of this Agreement shall be
     ineffective.   This Agreement shall remain in full force and
     effect until and including the date which is fifty (50)
     years after the date this Agreement becomes effective.

15.  Termination and Suspension For Cause.  This Agreement may be
     terminated upon thirty (30) days written notice to either
     party should it be determined the other party shall have
     failed in a material manner to comply with the terms of this
     Agreement and such non-compliance shall have continued for
     sixty (60) days after the party in non-compliance shall have
     received written notice setting forth with specificity the
     elements of the alleged non-compliance; provided, however,
     if such non-compliance is not reasonably susceptible of cure
     within such 60-day period and the party in non-compliance
     begins to cure such non-compliance within such 60-day
     period, then the party in non-compliance shall have such
     additional period of time as it reasonably requires to cure
     such non-compliance.  In the event the party alleged to be
     in non-compliance shall be unwilling or unable to cure such
     non-compliance within the cure period set forth above, then
     this Agreement shall terminate thirty (30) days after the
     end of such time period allowed for curing the non-
     compliance.  In addition, in the event an unexpected
     emergency endangers the public health or safety, then either
     party may unilaterally suspend this Agreement and the Right
     to Use, but only to the extent reasonably necessary to
     protect the public health and safety.  Such suspension shall
     terminate and this Agreement shall be revived to the extent
     such suspension ceases to be reasonably necessary to protect
     the public health and safety.

16.  Surrender of Premises.  Upon the earlier of (i) the
     expiration or termination of this Agreement or (ii) the
     permanent abandonment of the Premises by Koch or its
     assignee or their successors in interest with respect to the
     Premises (hereinafter collectively referred to as "User"),
     User shall yield possession of the Premises to the DNR and
     shall, within ninety (90) days after such time, at the DNR's
     option, either (A) remove the improvements located on the
     Premises from the Premises and restore the Premises to open
     green space by removal of debris and grading and seeding the
     Premises in a reasonable manner or (B) assign and transfer
     the portion of the improvements located on the Premises to
     the DNR in its then existing condition.  No later than sixty
     (60) days before the earlier of (i) expiration or
     termination of this Agreement or (ii) the permanent
     abandonment of the Premises by User, User shall deliver
     notice (hereinafter called the "Termination Notice") to the
     DNR requesting a meeting to discuss the disposition of the
     Premises.  Promptly thereafter, User and the DNR shall use
     reasonable good faith efforts to meet at the Premises to
     inspect the Premises and discuss the disposition of the
     Premises.  The DNR shall exercise the foregoing option on or
     before the date which is five (5) days before the earlier of
     (i) the expiration or termination, as the case may be, of
     this Agreement or (ii) the permanent abandonment of the
     Premises by User.  If, due to unexpected or unforeseen
     circumstances or the termination of this Agreement for
     cause, User shall be unaware of the impending (i)
     termination of this Agreement or (ii) permanent abandonment
     of the Premises by User on the date when the Termination
     Notice would otherwise be required to be given, then the
     deadline for delivery of the Termination Notice shall be
     equitably adjusted to reflect the date when User could
     reasonably be expected to provide such notice.

17.  Nondiscrimination.  Koch shall not exclude any person from
     participation in, or deny any person the benefits of, the
     use of the Premises, or otherwise subject any person to
     discrimination with respect to the use of the Premises
     because of the person's race, color, national origin, age or
     disability.

18.  Applicable Law.  This Agreement shall be construed in
     accordance with the laws of the State of Iowa.

19.  Successors and Assigns.  This Agreement shall be binding
     upon and inure to the benefit of the parties hereto and
     their successors and assigns.  Except as set forth in the
     next sentence hereof, neither Koch nor any assignee of Koch
     shall assign this Agreement without the consent of the DNR,
     which consent shall not be unreasonably withheld or delayed.
     Koch may assign this Agreement to Ameristar.  BY EXECUTION
     OF THIS AGREEMENT, THE DNR CONSENTS TO SUCH ASSIGNMENT, AND,
     NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT, UPON
     THE ASSIGNMENT OF THIS AGREEMENT TO AMERISTAR, KOCH SHALL BE
     RELIEVED OF ALL OBLIGATIONS AND LIABILITIES UNDER THIS
     AGREEMENT.

20.  Interpretation.  Should any dispute arise with respect to
     the enforceability or legality of this Agreement, each
     provision of this Agreement shall be interpreted so as to
     make such provision legal and enforceable and, to the extent
     any provision of this Agreement shall be determined to be
     illegal or unenforceable as drafted, such provision shall be
     deemed modified or limited to the extent necessary to cause
     such provision to be enforceable and legal.

21.  Financing.  Koch's assignee, Ameristar, contemplates
     obtaining financing consisting of one or more construction
     or permanent loans or a sale leaseback or similar
     arrangement to be secured by all or a portion of the
     improvements to be constructed on the Premises and User's
     rights under this Agreement (together with any refinancings
     of any of them, hereinafter called "Permitted Financing").
     In the event User applies for or obtains any Permitted
     Financing, the DNR shall for each such Permitted Financing,
     notwithstanding the existence of any claim, dispute or
     litigation between the parties hereto, promptly execute and
     consent to a Mortgagee Attornment Agreement substantially in
     the form attached hereto as Exhibit "G" and shall agree to
     any additional terms or provisions reasonably requested by
     the lender under the Permitted Financing which relate to
     such lender's security interest in the improvements to be
     constructed on the Premises or in this Agreement.

22.  Limitations on Authority.     Notwithstanding any other
     provision of this Agreement, this Agreement shall not vest
     in Koch the authority to exercise any governmental
     functions or powers, including but not limited to, law
     enforcement activities delegated to the DNR under applicable
     regulations, statutes, and judicial decisions.

23.  Recordation.  Either party may record this Agreement in the
     office of the Pottawattamie County Recorder upon the
     satisfaction of all conditions precedent to the
     effectiveness of this Agreement.

24.  Preparation of Survey.  The parties shall cooperate and use
     commercially reasonable efforts to cause a survey (the
     "Survey") of the Real Property to be prepared to describe
     with greater particularity the boundary between the Koch
     Property and the Premises.  The legal descriptions of the
     Koch Property and the Premises set forth in the Survey shall
     be deemed binding upon Koch and the State upon approval of
     the Survey by Koch and the DNR.  Neither Koch nor the DNR
     shall unreasonably delay or withhold such approval.
     Following approval of the Survey, Koch and the DNR shall
     each use its best efforts to cause the District Court to
     enter a decree quieting title in the form of Exhibit "H"
     attached hereto reflecting the legal descriptions set forth
     in the Survey.

25.  Approval by Executive Council of Iowa.  Because portions of
     this settlement agreement might be construed as requiring
     approval of the Executive Council of Iowa, approval of the
     Executive Council of Iowa shall be obtained before this
     settlement agreement is presented to the District Court.

This Agreement is entered into as of the date first above
written.

                         KOCH FUELS, INC.



                         By:   /s/ R.J. Witte
                         Name:    R.J. Witte
                         Title:    Vice President

ATTEST:
By:      /s/ H. Allen Coldwell
Name:  H. Allen Coldwell
Title:   Secretary

This agreement is entered into under the authority of a
resolution adopted at the regular meeting of the Natural Resource
Commission on    May 11, 1995                      , as shown in
the minutes thereof.

                         IOWA DEPARTMENT OF NATURAL RESOURCES



                         By:      /s/ Larry J. Wilson
                         Name:  Larry J. Wilson
                         Title:  Director


                         APPROVED BY:

                         EXECUTIVE COUNCIL OF IOWA



                         By:    /s/ Golda Beals
                         Name:  Golda Beals
                         Title:  Secretary
STATE OF IOWA               )
                            ) ss.
COUNTY OF      Polk         )

     On the _7__ day of ___June________________, 1995, before me,
a  notary Public in and for said State, personally appeared Larry
J.  Wilson  who stated that he is the duly appointed  and  acting
Director of the Iowa Department of Natural Resources and that the
Iowa  Natural Resource Commission by majority vote at its meeting
on   May  11,  1995  authorized  him  to  execute  the  foregoing
instrument, and that he executed the foregoing instrument as  his
voluntary act and deed and as the voluntary act and deed  of  the
Iowa Department of Natural Resources.



                                  /s/ Junie R. Gookin
                              Notary Public in and for the
                                     State of Iowa


STATE OF KANSAS             )
                            ) ss.
COUNTY OF SEDGWICK          )

    On the __5__ day of __June_________________, 1995, before me,
the undersigned, a Notary Public in and for the State of Iowa,
personally appeared ____R.J. Witte___, to me personally known,
who being by me duly sworn, did say that (s)he is the ___Vice
President______ of the corporation executing the within and
foregoing instrument that the seal affixed thereto is the seal of
the corporation; that the instrument was signed and sealed on
behalf of the corporation by authority of its Board of Directors;
and that __R.J. Witte_______ as officer acknowledged the
execution of the foregoing instrument to be the voluntary act and
deed of the corporation, by it and by (him/her) voluntarily
executed.



                                  /s/ Laure A. Palmer
                              Notary Public in and for the
                                     State of Iowa
STATE OF IOWA               )
                            ) ss.
COUNTY OF POLK              )

    On the __7__ day of __June_________________, 1995, before me,
a notary Public in and for said State, personally appeared Golda
Beals who stated that she is the duly appointed and acting
Secretary of the Executive Council of Iowa and that the Executive
Council of Iowa by majority vote at its meeting on May 15, 1995
authorized her to execute the foregoing instrument, and that she
executed the foregoing instrument as her voluntary act and deed
of the Executive Council of Iowa.



                                 /s/ Diane J. Birchard
                              Notary Public in and for the
                                     State of Iowa


EXHIBIT "A"

     THE REAL ESTATE


EXHIBIT "B"

     DIAGRAM OF THE KOCH PROPERTY AND THE PREMISES


EXHIBIT "C"

     FORM OF ESCROW AGREEMENT


EXHIBIT "D"

     FORM OF THE BOUNDARY LINE AGREEMENT


EXHIBIT "E"

     FORM OF THE AFFIDAVIT EXPLANATORY OF TITLE AND DISCLAIMER OF
     INTEREST


EXHIBIT "F"

     THE PUBLIC TRUST IMPROVEMENTS


EXHIBIT "G"

     FORM OF MORTGAGEE ATTORNMENT AGREEMENT


EXHIBIT "H"

     FORM OF COURT DECREE