Document:

Exhibit 4.9A

                             INTERCREDITOR AGREEMENT

         This INTERCREDITOR  AGREEMENT,  dated as of April 16, 2004 (as amended,
restated,   supplemented   or  otherwise   modified  from  time  to  time,  this
"AGREEMENT"), is made by and among U.S. BANK NATIONAL ASSOCIATION, solely in its
capacity as trustee under the Indenture  (as defined  below) (in such  capacity,
the  "TRUSTEE"),  and WELLS  FARGO  FOOTHILL,  INC.,  a  California  corporation
("WFF"), solely in its capacities as FF&E Agent, DJL Lender, OED Lender, and New
Revolver Agent (as such terms are defined below).

                                    RECITALS

         A. Diamond Jo, LLC, a Delaware limited liability  company ("DJL"),  The
Old Evangeline Downs Capital Corp., a Delaware corporation ("OED CORP"; OED Corp
and DJL,  together  with any  other  Person  that now or  hereafter  becomes  an
"issuer"  or  "co-issuer"  under the  Indenture  referred  to below,  whether by
joinder  agreement or otherwise,  collectively,  the "ISSUERS"),  the guarantors
from time to time party thereto (the "GUARANTORS"), and the Trustee have entered
into  an  Indenture,  dated  as  of  the  date  hereof  (as  amended,  restated,
supplemented or otherwise modified from time to time, the "INDENTURE"), pursuant
to which  indebtedness  was incurred by the Issuers,  the  repayment of which is
guaranteed by the Guarantors  and secured by security  interests in and liens on
certain now owned and hereafter acquired assets and properties  described in the
Indenture Security Documents (as defined below) (the "COLLATERAL").

         B. DJL, as  borrower,  and WFF, as lender (in such  capacity,  the "DJL
LENDER"), have entered into a Loan and Security Agreement,  dated as of February
23, 2001 (as amended, restated,  supplemented or otherwise modified from time to
time, the "DJL CREDIT AGREEMENT"), pursuant to which the DJL Lender agreed, upon
the terms and conditions  stated  therein,  to make loans and advances to, or to
issue letters of credit (or  guaranties in respect  thereof) for the account of,
DJL,  the  repayment  of which is secured by security  interests in and liens on
certain  Collateral  pursuant  to the DJL Credit  Agreement  and the  collateral
security  documents,  instruments  and  guaranties  executed  and  delivered  in
connection therewith by one or more of the Issuers and the Guarantors,  together
with  such  other  agreements,  instruments  and  certificates  entered  into in
connection  with the DJL Credit  Agreement  (as such may be  amended,  restated,
supplemented  or otherwise  modified  from time to time,  together  with the DJL
Credit Agreement, the "DJL LOAN DOCUMENTS").

         C. The Old Evangeline  Downs,  L.L.C.,  a Louisiana  limited  liability
company ("OED"),  and OED Corp, as borrowers (the "OED BORROWERS"),  and WFF, as
lender  (in such  capacity,  the "OED  LENDER"),  have  entered  into a Loan and
Security  Agreement,   dated  as  of  June  24,  2003  (as  amended,   restated,
supplemented  or  otherwise   modified  from  time  to  time,  the  "OED  CREDIT
AGREEMENT,"  and  together  with  the  DJL  Credit   Agreement,   the  "EXISTING
Revolvers"),  pursuant  to which  the OED  Lender  agreed,  upon the  terms  and
conditions stated therein, to make loans and advances to, or to issue letters of
credit (or guaranties in respect thereof) for the account of, the OED Borrowers,
the repayment of which is secured by security  interests in and liens on certain

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Collateral  pursuant to the OED Credit  Agreement  and the  collateral  security
documents,  instruments  and  guaranties  executed and  delivered in  connection
therewith by one or more of the Issuers and the  Guarantors,  together with such
other agreements,  instruments and certificates  entered into in connection with
the OED Credit  Agreement  (as such may be amended,  restated,  supplemented  or
otherwise  modified from time to time,  together with the OED Credit  Agreement,
the "OED LOAN  DOCUMENTS";  the OED Loan  Documents,  together with the DJL Loan
Documents, the "EXISTING REVOLVER DOCUMENTS").

         D.  OED and  OED  Corp,  as  borrowers  (together  with  each of  OED's
subsidiaries from time to time party thereto, the "FF&E BORROWERS"), the lenders
from time to time party thereto (the "FF&E LENDERS"), and WFF, as administrative
agent for the FF&E Lenders (in such capacity,  the "FF&E  AGENT"),  have entered
into a Loan and Security Agreement,  dated as of September 22, 2003 (as amended,
restated, supplemented or otherwise modified from time to time, the "FF&E CREDIT
AGREEMENT"),  pursuant  to which  the FF&E  Lenders  agreed,  upon the terms and
conditions  stated  therein,  to make  term  loans  to the FF&E  Borrowers,  the
repayment  of which is or may be secured by security  interests  in and liens on
certain  Collateral  pursuant to the FF&E Credit  Agreement  and the  collateral
security  documents  and  instruments   executed  and  delivered  in  connection
therewith by one or more of the Issuers and the  Guarantors,  together with such
other agreements,  instruments and certificates  entered into in connection with
the FF&E Credit  Agreement (as such may be amended,  restated,  supplemented  or
otherwise  modified from time to time,  together with the FF&E Credit Agreement,
the "FF&E LOAN DOCUMENTS").

         E. In  connection  with the offering of the notes under the  Indenture,
each  of DJL  and  the  OED  Borrowers  have  agreed  to use  their  good  faith
commercially  reasonable  efforts to obtain required approvals from the relevant
gaming  authorities and to repay in full and refinance (the  "REFINANCING")  the
Existing  Revolvers,  pursuant to a proposed  new  revolving  loan and  security
agreement (as amended, restated, supplemented,  refinanced or otherwise modified
from time to time, the "NEW REVOLVER  AGREEMENT")  among DJL, the OED Borrowers,
certain  lenders from time to time party thereto (the "NEW  REVOLVER  LENDERS"),
and WFF, as administrative agent for the New Revolver Lenders (in such capacity,
the "NEW REVOLVER AGENT").  As with the Existing  Revolvers,  it is contemplated
that the New  Revolver  Agreement  will be secured by security  interests in and
liens on certain  Collateral  pursuant to the  agreements,  collateral  security
documents,  instruments  and  guaranties  executed and  delivered in  connection
therewith by one or more of the Issuers and the  Guarantors,  together  with the
other agreements,  instruments and certificates  entered into in connection with
the New Revolver  Agreement (as such may be amended,  restated,  supplemented or
otherwise modified from time to time,  together with the New Revolver Agreement,
the "NEW REVOLVER DOCUMENTS").

         F. One of the  conditions  of the  Senior  Lien  Documents  is that the
priority of the  security  interests  and liens on the  Collateral  securing the
obligations  under such  documents  be senior to the  security  interests in and
liens on the  Collateral in favor of the Trustee in the manner and to the extent
provided for in this Agreement.

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         G. The Trustee and the Senior Lien Creditor  Representatives (on behalf
of the Senior Lien  Creditors)  desire to enter into this  Agreement  concerning
their  respective  rights  with  respect  to the  priority  of their  respective
security interests in and liens on the Collateral.

         H. The terms of the Indenture  permit the Issuers and the Guarantors to
(1) remain  obligated  under the FF&E Loan  Documents and the Existing  Revolver
Documents  to which  they  are  parties,  and (2)  enter  into the New  Revolver
Documents  and, in  connection  therewith,  authorize  and direct the Trustee to
enter  into  an  intercreditor  agreement  substantially  in the  form  of  this
Agreement.

         NOW, THEREFORE, the Parties hereby agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

         Section 1.1 Definitions.  In addition to the capitalized  terms defined
above in the preamble and the recitals  hereto,  as used in this Agreement,  the
following terms shall have the meanings set forth below:

         "CREDIT  FACILITY  INDEBTEDNESS"  shall  mean all  present  and  future
obligations (including principal,  interest, fees and reimbursement  obligations
under  letters of  credit),  contingent  or  otherwise,  of the  Issuers and the
Guarantors to the Senior Lien Creditors  arising under or pursuant to the Senior
Lien Documents,  including, in each case, interest,  fees, and expenses accruing
after the  initiation  of any  Insolvency  Proceeding  (irrespective  of whether
allowed as a claim in such proceeding),  and including the secured claims of any
Senior Lien Creditor in respect of the Collateral in any Insolvency Proceeding.

         "ENFORCEMENT  ACTION"  shall mean the  exercise  of any right or remedy
with respect to any Collateral (including any right of set-off) or the taking of
any Foreclosure  Action or other action to enforce,  collect or realize upon any
Collateral,  or the  commencement of any action,  whether judicial or otherwise,
for the  enforcement of such Party's  rights and remedies as a secured  creditor
with  respect  to the  Collateral,  or  the  commencement  of  any  receivership
proceedings  or any  other  sale of,  collection  on,  or  disposition  of,  any
Collateral,  including  the  exercise  of any  right,  remedy or action  to: (a)
exercise  any  collection  rights in  respect  of any  Collateral  or notify any
account  debtors to make  payment  directly to such Party or its agents or other
Persons  acting on its  behalf or retain  any  proceeds  of  accounts  and other
obligations  receivable  paid by any  account  debtor;  (b) take or  accept  any
transfer of title in lieu of foreclosure  upon any  Collateral;  (c) enforce any
claim to the proceeds of insurance upon any Collateral;  (d) deliver any notice,
claim  or  demand  relating  to the  Collateral  to any  Person  (including  any
securities  intermediary,  depositary  bank or  landlord) in the  possession  or
control of any Collateral or acting as bailee,  custodian or agent for any Party
in respect of any Collateral;  or (e) otherwise  enforce any remedy available to
such Party upon default for the enforcement of any Lien upon the Collateral.

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         "ENFORCEMENT  EVENT" shall mean the  occurrence  and  continuance of an
"Event of Default" as defined under Section 6 of the Indenture.

         "ENFORCEMENT  EVENT NOTICE" shall have the meaning  ascribed thereto in
Section 3.2.

         "ENTITLED  PARTY"  shall have the meaning  ascribed  thereto in Section
4.1(a).

         "EVENT  OF  DEFAULT"  shall  mean,  with  respect  to any  Senior  Lien
Document, the occurrence of an "Event of Default" under, and as defined in, such
Senior Lien Document.

         "FF&E SECURED LIABILITIES" shall mean Secured Liabilities  evidenced by
the FF&E Loan Documents.

         "FINANCING DOCUMENTS" shall mean the Indenture Documents and the Senior
Lien Documents.

         "FORECLOSURE ACTION" shall mean any action to foreclose upon or enforce
a Lien  against any of the  Collateral,  including  (a)  commencing  judicial or
non-judicial  foreclosure  proceedings,  (b) exercising  any rights  afforded to
secured  creditors  in a case  under  the  Bankruptcy  Law with  respect  to the
Collateral,  or (c) taking any action  under the  Bankruptcy  Law that  directly
relates to or directly affects any such  Collateral,  other than any such action
that  relates to or affects  all or  substantially  all of the  property  of the
bankruptcy estate.

         "FULLY  PAID" shall mean (a) with respect to the  Indenture  Documents,
the payment in cash or cash  equivalents in full of all obligations  (other than
contingent,  unliquidated  indemnity  obligations  that survive payment in full)
under the Indenture Documents, and (b) with respect to any Senior Lien Document,
(i) the payment in cash or cash  equivalents in full of all  obligations  (other
than  contingent,  unliquidated  indemnity  obligations  that survive payment in
full) under such Senior Lien Document (it being agreed and understood  that with
respect to any Senior Lien Document,  the principal  amount of such  obligations
shall at no time exceed the applicable  Maximum Credit  Facility  Amount),  plus
related interest,  fees, costs,  expenses and reimbursement and  indemnification
obligations),  and (ii) the termination of all commitments or other  obligations
of the Senior Lien  Creditors  under such Senior Lien  Document to extend credit
thereunder to any Issuer, any Guarantor, or any other subsidiary of an Issuer.

         "INDENTURE  DOCUMENTS"  shall  mean  the  Indenture,   the  Notes,  the
Indenture  Security  Documents and the Registration  Rights Agreement,  and such
other  agreements,  instruments  and  certificates  executed and  delivered  (or
issued) by the Issuers or the Guarantors  pursuant to the  Indenture,  as any or
all of the same may be amended,  restated,  supplemented  or otherwise  modified
from time to time.

         "INDENTURE  SECURITY  DOCUMENTS"  has the meaning  assigned to the term
"Security Documents" in the Indenture.

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<PAGE>

         "INSOLVENCY  PROCEEDING"  shall mean any proceeding for the purposes of
dissolution,  winding up,  liquidation,  arrangement  or  reorganization  of the
Issuers,  any  Guarantor,  or any  other  subsidiary  of the  Issuers,  or their
respective   successors   or  assigns,   whether  in   bankruptcy,   insolvency,
arrangement,  reorganization or receivership proceedings,  or upon an assignment
for  the  benefit  of  creditors  or any  other  marshaling  of the  assets  and
liabilities  of the  Issuers,  any  Guarantor,  or any other  subsidiary  of the
Issuers, or their respective successors or assigns.

         "LIEN  PRIORITY"  shall  mean,  with  respect to any Lien in and to the
Collateral,  the order of priority of such Lien as specified in Sections 2.1 and
2.2.

         "MAXIMUM  CREDIT  FACILITY  AMOUNT" shall mean,  with respect to Credit
Facility   Indebtedness   owed   pursuant  to  (a)  the  FF&E  Loan   Documents,
$[16,000,000] (less any permanent  principal  reductions  thereto),  and (b) the
Senior Lien Documents (other than the FF&E Loan Documents),  $35,000,000,  which
amount may be increased  or  decreased  as provided in Section  4.7(b)(i) of the
Indenture (as in effect on the date hereof), in each case in aggregate principal
amount of such Credit Facility  Indebtedness,  plus all related  interest,  fees
expenses and  indemnification  obligations  or such greater amount or amounts as
the Trustee may consent to in its discretion.

         "NEW  REVOLVER  SECURED  LIABILITIES"  shall mean  Secured  Liabilities
evidenced by the New Revolver Loan Documents.

         "PARTY"  shall mean each of (a) the  Trustee,  (b) the FF&E Agent,  (c)
prior to the Refinancing,  the DJL Lender, (d) prior to the Refinancing, the OED
Lender, and (e) upon and after the Refinancing, the New Revolver Agent.

         "SECURED LIABILITIES" shall mean the Subordinated Lien Indebtedness and
the Credit Facility Indebtedness (up to the Maximum Credit Facility Amount).

         "SECURITY   DOCUMENTS"  shall  mean  any  and  all  Indenture  Security
Documents  and  any and all  Senior  Lien  Documents,  in  each  case  executed,
delivered or authorized  by an Issuer or any  Guarantor or any  subsidiary of an
Issuer  pursuant to which such Person grants to the Trustee (as security for the
Subordinated Lien Indebtedness) or any Senior Lien Creditor (as security for the
applicable Credit Facility Indebtedness) a security interest in any Collateral.

         "SENIOR LIEN DOCUMENTS" shall mean, collectively and individually,  (a)
the FF&E Loan  Documents,  and (b) (i) prior to the  Refinancing,  the  Existing
Revolver  Documents,  and (ii) upon and after the Refinancing,  the New Revolver
Documents.

         "SENIOR LIEN CREDITORS" shall mean, collectively and individually,  (a)
the FF&E Agent and the FF&E Lenders,  and (b) (i) prior to the Refinancing,  the
DJL Lender and the OED Lender, and (ii) upon and after the Refinancing,  the New
Revolver Agent and the New Revolver Lenders.

         "SENIOR LIEN CREDITOR  REPRESENTATIVES"  shall mean,  collectively  and
individually,  (a) the FF&E Agent,  on behalf of the FF&E  Lenders,  and (b) (i)
prior to the

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Refinancing,  the DJL  Lender  and the OED  Lender,  and (ii) upon and after the
Refinancing, the New Revolver Agent on behalf of the New Revolver Lenders.

         "SUBORDINATED  LIEN  INDEBTEDNESS"  shall mean all  present  and future
obligations,  contingent or otherwise,  of the Issuers and the Guarantors to the
Trustee  or  Holders  arising  under or  pursuant  to the  Indenture  Documents,
including,  in each  case,  interest,  fees  and  expenses  accruing  after  the
initiation of any Insolvency  Proceeding  (irrespective  of whether allowed as a
claim in such  proceeding),  and including the secured  claims of the Trustee or
the Holders in respect of the Collateral in any Insolvency Proceeding.

         Section 1.2 Indenture Definitions. All other capitalized terms that are
used but not defined herein shall have the respective  meaning  indicated in the
Indenture, as in effect on the date hereof.

         Section 1.3  Miscellaneous.  All definitions  herein (whether set forth
herein  directly or by reference to  definitions  in other  documents)  shall be
equally  applicable  to both the  singular  and the  plural  forms of the  terms
defined. The words "hereof," "herein" or "hereunder" and words of similar import
when used in this Agreement  shall refer to this Agreement as a whole and not to
any particular  provision of this Agreement.  Article and section references are
to articles and sections of this Agreement unless otherwise specified.  The term
"including" shall mean "including without limitation."

                                   ARTICLE II
                                  LIEN PRIORITY

         Section 2.1 Agreement to Subordinate  Liens.  The Trustee hereby agrees
that all Liens of the  Trustee  for the benefit of itself and the Holders in and
to the Collateral are and shall be junior to and  subordinate in priority to the
Liens  of  any or all of the  Senior  Lien  Creditors  in and to the  Collateral
securing  Credit  Facility  Indebtedness  (up to  the  Maximum  Credit  Facility
Amount); provided that, the rights of a Party under this Agreement shall be void
and of no further force and effect if, and only to the extent, that the Liens of
such  Party in and to the  Collateral  are  avoided,  disallowed,  set  aside or
otherwise  invalidated  in any  action or  proceeding  by a court,  tribunal  or
administrative   agency   of   competent   jurisdiction   and  such   avoidance,
disallowance,  set aside or other  invalidation  is  permanent  and is not later
reversed.  The  subordination  of the Liens of the  Trustee  for the  benefit of
itself and the  Holders  in and to the  Collateral  in favor of the Senior  Lien
Creditors  provided for herein shall not be deemed to (a)  subordinate the Liens
of the  Trustee  for the  benefit of itself and the  Holders to the Liens of any
other Person, or (b) subordinate the Subordinated Lien Indebtedness to any other
Indebtedness  of the  Issuers  or any of the  Guarantors,  including  the Credit
Facility Indebtedness.

         Section 2.2  Non-Contest;  Excluded  Assets.  Each Party agrees that it
will not attack or contest the validity, perfection,  priority or enforceability
of the Liens of the other  Party or finance  or urge any other  Person to do so;
provided that, any Party may enforce its rights and privileges hereunder without
being deemed to have violated this

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provision.   Any  provision   contained  in  this   Agreement  to  the  contrary
notwithstanding,  the terms and conditions of this Agreement shall not apply, as
between any Senior Lien Creditor Representative on the one hand, and the Trustee
on the other hand, to any property or assets (including  property or assets that
do  not   constitute   Collateral)   as  to  which  such  Senior  Lien  Creditor
Representative  has a Lien and as to which the Trustee does not have a Lien,  or
as to which the Trustee has a Lien and such Senior Lien Creditor  Representative
does not have a Lien.

         Section 2.3       Exercise of Rights.

               (a) The Trustee may exercise, and nothing herein shall constitute
a waiver of, any right it may have at law or equity to receive  notice of, or to
commence or join with any  creditor in  commencing  any  Insolvency  Proceeding;
provided  that,  the  exercise  of any such  right by the  Trustee  shall be (i)
subject to the Lien  Priority  and  application  of  proceeds of  Collateral  as
provided in Section 3.4 and (ii) subject to the  provisions  of Sections 3.1 and
3.2.

               (b)  Notwithstanding  any other provision hereof, the Trustee may
make such  demands or file such claims as may be necessary to prevent the waiver
or bar of  such  claims  under  applicable  statutes  of  limitations  or  other
statutes, court orders or rules of procedure.

         Section  2.4  Priority  of  Liens.  (a)  Irrespective  of any  priority
otherwise  available to the Trustee by law or agreement or  irrespective  of the
order of recording of mortgages,  financing  statements,  security agreements or
other instruments,  and irrespective of the descriptions of Collateral contained
in the Financing  Documents,  including any  financing  statements,  each of the
Trustee  and  the  Senior  Lien  Creditor  Representatives  hereby  agree  among
themselves that their  respective  Liens in the Collateral  shall be governed by
the Lien  Priority,  which  shall be  controlling  in the event of any  conflict
between this Agreement and any of the Financing Documents.

               (b) Each Party agrees that this  Agreement  and the Lien Priority
shall  remain in full  force and  effect  without  regard  to,  and shall not be
released, suspended,  discharged,  terminated, modified or otherwise affected by
any  circumstance  or occurrence  whatsoever  (other than in accordance with the
terms  hereof),  including  any of the  following  (whether  or not  such  Party
consents  thereto  or has  notice  thereof):  (i) any change in or waiver of the
time,  place or manner of  payment,  or any other  term,  of any of the  Secured
Liabilities  or Financing  Documents,  any waiver of or any renewal,  extension,
increase,  refinancing,  amendment or  modification  of or addition,  consent or
supplement  to or deletion  from,  or any other  action or inaction  under or in
respect of, any of the Secured  Liabilities or Financing  Documents or any other
document,  instrument  or  agreement  referred to therein or any  assignment  or
transfer of any of the Secured  Liabilities  or  Financing  Documents;  (ii) any
furnishing of any additional  collateral  for any of the Secured  Liabilities or
any sale,  exchange,  release or surrender of, or realization on, any collateral
for any of the Secured Liabilities;  (iii) any settlement, release or compromise
of any  of the  Secured  Liabilities  or  Financing  Documents,  any  collateral
therefor,  or any liability of any other party  (including any other Party) with
respect to any

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of the Secured  Liabilities  or Financing  Documents,  or any  subordination  of
payment of any Secured  Liabilities  to the  payment of any other  indebtedness,
liability or obligation of any of the Issuers,  Guarantors or any  subsidiary of
any  Issuer;  (iv)  any  bankruptcy,  insolvency,  reorganization,  composition,
adjustment,  merger,  consolidation,  dissolution,  liquidation  or  other  like
proceeding  or  occurrence  relating to any of the Issuers,  Guarantors,  or any
subsidiary  of any  Issuer,  or any  other  change  in the  ownership,  control,
composition  or nature of any of the Issuers,  Guarantors,  or any subsidiary of
any Issuer;  (v) any application of sums paid by any of the Issuers,  Guarantors
or any subsidiary of any Issuer with respect to any of the Secured  Liabilities,
except  to  the  extent  actually  applied  against  such  Secured  Liabilities,
regardless  of  what  other  liabilities  of  the  Issuers,  Guarantors,  or any
subsidiary  of any Issuer  remain  unpaid;  or (vi) the  failure of any Party to
assert  any claim or  demand or to  enforce  any  right or  remedy  against  the
Issuers, Guarantors, any subsidiary of any Issuer or any other Person (including
any other  Party  with  respect  to any of the  Secured  Liabilities)  under the
provisions of any of the Financing Documents or otherwise.

         Section 2.5  Insolvency.  (a) The  provisions of this Agreement will be
applicable  both before and after the filing or  commencement  of any Insolvency
Proceeding  and all converted or succeeding  cases in respect  thereof,  and all
references  herein to any  Issuer or  Guarantor  shall be deemed to apply to the
trustee for such Issuer and/or  Guarantor and such Issuer and/or  Guarantor as a
debtor-in-possession.  The relative rights of the Senior Lien Creditors in or to
any distributions from or in respect of any Collateral or proceeds of Collateral
shall continue after the filing of such Insolvency  Proceeding on the same basis
as prior to the date of such filing,  subject to any court order  approving  the
financing  of,  or use of  cash  collateral  by,  any  Issuer  or  Guarantor  as
debtor-in-possession.  If,  in any  Insolvency  Proceeding  and at any  time any
Credit  Facility  Indebtedness  exists that has not been Fully Paid,  all of the
Senior Lien  Creditors (or such number of the Senior Lien  Creditors as may have
the power to bind all of them):

                    (i) consent to any order for use of cash collateral or agree
     to the  extension  of  any  Credit  Facility  Indebtedness  (including  any
     debtor-in-possession financing) to any Issuer or Guarantor;

                    (ii)  consent  to  any  order  granting  any  priming  lien,
     replacement  lien,  cash  payment  or other  relief  on  account  of Credit
     Facility  Indebtedness  as adequate  protection (or its equivalent) for the
     interests of the Senior Lien Creditors in the property subject to such Lien
     of a Senior Lien Creditor Representative;

                    (iii) consent to any order approving post-petition financing
     pursuant to Section 364 of the United States Bankruptcy Code (including any
     "roll-up" of Credit Facility Indebtedness); or

                    (iv)  consent to any order  relating  to a sale of assets of
     any Issuer or Guarantor that provides, to the extent the sale is to be free
     and clear of Liens, that all Liens of the Senior Lien Creditor

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     Representatives and the Lien of the Trustee shall attach to the proceeds of
     the sale,

then the Trustee and the Holders will not oppose or otherwise  contest the entry
of such order.

               (b) So long as there is any Credit Facility Indebtedness existing
that has not been Fully Paid, none of the Holders or the Trustee will:

                    (i) request judicial relief, in an Insolvency  Proceeding or
     in any other court, that would hinder,  delay, limit or prohibit the lawful
     exercise or enforcement of any right or remedy  otherwise  available to the
     Senior Lien Creditor  Representatives  in respect of the Collateral or that
     would  limit,  invalidate,  avoid or set  aside  any Lien of a Senior  Lien
     Creditor  Representative or Senior Lien Document or subordinate the Lien of
     a Senior Lien Creditor  Representatives to the Lien of the Trustee or grant
     the Lien of a Senior Lien  Creditor  Representatives  equal  ranking to the
     Lien of the Trustee;

                    (ii) oppose or otherwise  contest any motion for relief from
     the  automatic  stay  or  from  any  injunction   against   foreclosure  or
     enforcement of Lien of a Senior Lien Creditor  Representatives  made by any
     Senior Lien Creditor Representatives in any Insolvency Proceeding;

                    (iii) oppose or otherwise contest any lawful exercise by any
     Senior Lien Creditor Representatives of the right to credit bid at any sale
     in foreclosure of a Lien of a Senior Lien Creditor Representative;

                    (iv)  oppose or  otherwise  contest  any other  request  for
     judicial   relief   made  in  any  court  by  any  Senior   Lien   Creditor
     Representative  relating to the lawful  enforcement of any Lien of a Senior
     Lien Creditor Representative;

                    (v) request relief from the automatic stay in any Insolvency
     Proceeding unless any Senior Lien Creditor requests such relief; or

                    (vi)  challenge  the   enforceability,   perfection  or  the
     validity of the Credit  Facility  Indebtedness or the Lien of a Senior Lien
     Creditor Representative.

               (c) The  Trustee  will not file or  prosecute  in any  Insolvency
Proceeding  any motion for adequate  protection or for relief from the automatic
stay (in each  case,  or any  comparable  request  for  relief)  based  upon its
interests in the Collateral, except that:

                                       9
<PAGE>

                    (i)  it  may  freely  seek  and  obtain  relief  granting  a
     replacement lien, additional lien,  superpriority,  administrative claim or
     other  adequate   protection   co-extensive   in  all  respects  with,  but
     subordinated  in accordance  with the Lien Priority in all respects to, all
     Liens granted in such Insolvency Proceeding to the Senior Lien Creditors in
     connection with Credit Facility Indebtedness;

                    (ii) it may assert rights  consistent with this Agreement in
     connection with the confirmation of any plan of  reorganization  or similar
     dispositive restructuring plan; and

                    (iii) it may freely seek and obtain any relief upon a motion
     for  adequate  protection  or for relief from the  automatic  stay (in each
     case,  or any  comparable  relief),  without any  condition or  restriction
     whatsoever,  at any time when all  Credit  Facility  Indebtedness  has been
     Fully Paid.

               (d) If, in any  Insolvency  Proceeding,  debt  obligations of the
reorganized  debtor secured by Liens upon any property of the reorganized debtor
are distributed,  both on account of Credit Facility Indebtedness and on account
of the Subordinated Lien Indebtedness,  then, to the extent the debt obligations
distributed on account of the Credit Facility Indebtedness and on account of the
Subordinated Lien Indebtedness are secured by Liens upon the same property,  the
provisions  of this  Agreement  will  survive  the  distribution  of  such  debt
obligations  pursuant  to such plan and will apply with like effect to the Liens
securing such debt obligations.

               (e) Subject to Section 3.4(a)(ii), the Trustee will not assert or
enforce,  at any time when any Credit Facility  Indebtedness exists that has not
been Fully Paid, any claim under  ss.506(c) of the Bankruptcy  Code senior to or
on a parity with the Lien of a Senior Lien Creditor  Representative for costs or
expenses of preserving or disposing of any Collateral.

         Section 2.6 Insurance and Condemnation Proceeds. At any time any Credit
Facility  Indebtedness  exists  that has not been Fully  Paid,  the Senior  Lien
Creditor  Representatives  will have the sole right to adjust  settlement of all
insurance  claims  and  condemnation  awards in the event of any  covered  loss,
theft,  destruction  or  condemnation  of any  Collateral  and all claims  under
insurance  constituting  Collateral,  subject  to the terms of the  Senior  Lien
Documents.

                                   ARTICLE III
                             ACTIONS OF THE PARTIES

         Section 3.1  Limitation  on Certain  Actions.  Subject to Section  3.2,
until the first date on which the Maximum Credit  Facility Amount is Fully Paid,
the  Trustee  will not,  without the prior  written  consent of each Senior Lien
Creditor Representative, take any Enforcement Action.

                                       10
<PAGE>

         Section 3.2 Standstill Period. If an Enforcement Event has occurred and
is continuing,  the Trustee, on behalf of the holders of the Notes, may give the
Senior Lien Creditor  Representative  written  notice  thereof (an  "ENFORCEMENT
EVENT  NOTICE"),  which  notice  shall  constitute  notice to each  Senior  Lien
Creditor.  If (a)  such  Enforcement  Event  is  continuing  for  more  than 180
consecutive  days after the  delivery  of such  Enforcement  Event  Notice  (the
"EXPIRY DATE"), (b) no Senior Lien Creditor Representative has, on or before the
Expiry Date,  commenced (and notified the Trustee that such Senior Lien Creditor
Representative  has  commenced)  one or more  Enforcement  Actions,  and (c) the
Issuer or the Guarantor against which the Trustee's proposed  Enforcement Action
is to be taken is not the subject of an Insolvency Proceeding,  then the Trustee
may,  subject to the Lien  Priority and the  application  of all proceeds of the
Collateral in accordance with Section 3.4, take one or more Enforcement Actions.
If (i) any Senior Lien Creditor  Representative  has  commenced any  Enforcement
Action on or prior to the Expiry Date and, at any time after the Expiry Date, is
no  longer  pursuing  one  or  more  Enforcement  Actions,  (ii)  no  Insolvency
Proceeding  is pending  against the Issuers or the  Guarantor  against which the
Trustee's proposed  Enforcement Action is to be taken, and (iii) the Enforcement
Event that was the subject of, or existing on the date of, the Enforcement Event
Notice is then  continuing,  then the Trustee may,  subject to the Lien Priority
and the prior  application of all proceeds of the Collateral in accordance  with
Section 3.4, take one or more Enforcement Actions.  Except as expressly provided
for in this Agreement,  nothing in this Agreement shall prevent the Parties from
exercising  any other  remedy,  or taking  any  other  action,  under any of the
Financing Documents.

         Section  3.3  Foreclosure.  Any Party  taking a  permitted  Enforcement
Action may enforce its Financing  Documents  independently as to the Issuers and
each Guarantor and  independently  of any other remedy or security such Party at
any time may have or hold in  connection  with  its  Secured  Liabilities,  and,
except as provided  herein,  it shall not be necessary for such Party to marshal
assets in favor of any other  Party or any other  Person or to  proceed  upon or
against or exhaust any other security or remedy before proceeding to enforce the
Financing  Documents.  Each of the Trustee  (for so long as the  Maximum  Credit
Facility Amount is not Fully Paid) and each Senior Lien Creditor  Representative
(for so long as the  Trustee  and the  Holders  are owed any  Subordinated  Lien
Indebtedness)  expressly  waives any right to require the other Party to marshal
assets in favor of any Party or to proceed  against any  Collateral  provided by
the Issuers or any  Guarantor,  or any other  property,  assets,  or  collateral
provided by the Issuers, any Guarantor, or any other Person, and agrees that the
Party taking such permitted  Enforcement Action may proceed against the Issuers,
any Guarantor,  any Collateral or other property,  assets,  or other  collateral
provided  by any of them or by any  other  Person,  in such  order  as it  shall
determine in its sole and absolute  discretion.  The foregoing  notwithstanding:
(a) with respect to the sale or other disposition of any Collateral  governed by
Article 9 of the Uniform  Commercial  Code,  the Party  conducting  such sale or
other disposition agrees in favor of the other Parties that every aspect of such
sale or other disposition, including the method, manner, time, place, and terms,
must  be  commercially  reasonable,  (b)  with  respect  to the  sale  or  other
disposition  of any other  Collateral  consisting  of real  property,  the Party
conducting such sale or other  disposition  agrees in favor of the other Parties
that such sale or other disposition  shall be conducted  according to the normal
practices of  commercial  real  property  secured  lenders  generally,

                                       11
<PAGE>

(c) with  respect  to the sale or other  disposition  of any  Collateral  by any
Party,  such Party agrees to provide the other Parties with such written  notice
as it is required by  applicable  law  (including,  if  applicable,  the Uniform
Commercial Code) to provide to the Issuers or the Guarantors  (without regard to
whether the Issuers or the Guarantors  have waived their  entitlement to receive
such notice), and (d) each Senior Lien Creditor  Representative  agrees that, at
such time as the Maximum Credit  Facility  Amount  applicable to its Senior Lien
Documents  is Fully Paid,  such Senior Lien  Creditor  Representative  thereupon
promptly  shall cease all further  Enforcement  Actions in  connection  with its
Senior Lien Documents.

         Section 3.4 Distribution. Each Party agrees that, upon any distribution
as a result of any  Enforcement  Action,  or the receipt of any other payment or
distribution  with  respect to the  Collateral,  the proceeds  thereof  shall be
distributed in the order of, and in accordance with, the following priorities:

               (a) FIRST:

                    (i) if the  Enforcement  Action  is taken  by a Senior  Lien
     Creditor, to the payment of all reasonable costs and expenses,  commissions
     and taxes of such Senior Lien Creditor  incurred in connection  with taking
     such  Enforcement  Action or other  realization,  including all  reasonable
     expenses (including attorneys fees and expenses),  liabilities and advances
     made or incurred by or on behalf of such Senior Lien Creditor in connection
     therewith;

                    (ii) if the  Enforcement  Action is taken and entitled to be
     taken hereunder by the Trustee,  to the payment of all reasonable costs and
     expenses,  commissions and taxes of the Trustee incurred in connection with
     taking  such  Enforcement  Action  or  other  realization,   including  all
     reasonable  expenses (including  attorneys fees and expenses),  liabilities
     and advances  made or incurred by or on behalf of the Trustee in connection
     therewith;

               (b) SECOND, to the Senior Lien Creditor Representatives,  for the
benefit of the Senior Lien Creditors,  until the first date on which the Maximum
Credit Facility Amount is Fully Paid;

               (c)  THIRD,  to  the  Trustee,   until  all   Subordinated   Lien
Indebtedness is Fully Paid; and

               (d) FOURTH,  to or at the direction of the  applicable  Issuer or
Guarantor, or as a court of competent jurisdiction shall direct.

         Section  3.5  Notice of  Certain  Events;  Information.  (a) Each Party
agrees that it will notify the other Parties (it being  understood  that, to the
extent this Section 3.5 applies to an  obligation of the Trustee to give notice,
it may satisfy  such  obligation  by giving  notice to any Senior Lien  Creditor
Representative),  in writing, (x) if it receives actual notice of the occurrence
of an Event of Default or an Enforcement

                                       12
<PAGE>

Event, not later than 30 days after the date of any such occurrence,  and (y) at
least 15 days prior to  exercising  any remedies  with respect to any portion of
the  Collateral.   Notwithstanding  the  foregoing,   no  Senior  Lien  Creditor
Representative  shall be  obligated  to  provide  such prior  written  notice if
exigent circumstances require that such Senior Lien Creditor  Representative act
immediately in order to preserve,  protect, or obtain possession or control over
the  Collateral  or  any  portion  thereof;   provided  that,  if  such  exigent
circumstances  require  such  Senior  Lien  Creditor  Representative  to so  act
immediately,  such Senior  Lien  Creditor  Representative  agrees to provide the
Trustee with written  notice as soon as  practicable  following such Senior Lien
Creditor  Representative  first exercising any of its secured creditor  remedies
with respect to the  Collateral,  and no Party shall incur any  liability to the
other under this Section 3.5 as a result of the failure of such Party to provide
any such  notice so long as the  failure to so provide  such  notice was not the
result of willful misconduct, bad faith or gross negligence.

               (b) The Senior Lien  Creditor  Representatives,  on the one hand,
and the  Trustee,  on the other  hand,  shall each be  responsible  for  keeping
themselves  informed of the financial  condition of the Issuers,  Guarantors and
their  subsidiaries  and  all  other  circumstances  bearing  upon  the  risk of
nonpayment  of  the  Secured  Liabilities.  Neither  any  Senior  Lien  Creditor
Representative,  nor the  Trustee,  on the other  hand,  shall  have any duty to
advise the other party of information  regarding such condition or circumstances
or, except as otherwise  expressly  provided herein,  as to any other matter. If
any Senior Lien Creditor  Representative on the one hand, or the Trustee, on the
other hand, in their respective discretion,  undertakes at any time or from time
to time to provide any such information to any Party,  such first Party shall be
under no  obligation  to  provide  any  similar  information  on any  subsequent
occasion, to provide any additional information, to undertake any investigation,
or to disclose  any  information  which,  pursuant  to  accepted  or  reasonable
commercial finance practice, it wishes to maintain confidential.

                                   ARTICLE IV

                            ENFORCEMENT OF PRIORITIES

          Section 4.1 In  Furtherance of Lien  Priorities.  Each Party agrees as
follows:

               (a) All  payments  or  distributions  of or with  respect  to the
Collateral  that are received by any Party  contrary to the  provisions  of this
Agreement (including payments or distributions in connection with any Insolvency
Proceeding) shall be segregated from other funds and property held by such Party
and shall be held in trust for the Party entitled thereto in accordance with the
provisions of Section 3.4 (the "ENTITLED  PARTY") and such Party shall forthwith
pay over such  remaining  proceeds to the Entitled  Party in the same form as so
received (with any necessary endorsement) to be applied (in the case of cash) or
held as  Collateral  (in  the  case  of  non-cash  property  or  securities)  in
accordance  with the  provisions  hereof and the  provisions  of the  applicable
Financing Documents.

                                       13
<PAGE>

               (b) After the first  date on which the  Maximum  Credit  Facility
Amount  relating to any Senior Lien  Documents  is Fully Paid,  each  applicable
Senior  Lien  Creditor  Representative  will  promptly  execute  and deliver all
further  instruments  and  documents,  and take  all  further  acts  that may be
necessary,  or that the Trustee may reasonably request, to permit the Trustee to
evidence the  termination  of the Lien  Priority  applicable to such Senior Lien
Creditor Representative  hereunder, or in furtherance thereof; provided that, no
Senior Lien Creditor Representative shall be required to pay over any payment or
distribution,  execute any  instruments  or documents,  or take any other action
referred to in this clause (b) to the extent that such action  would  contravene
any law, order or other legal requirement,  and in the event of a controversy or
dispute, such Senior Lien Creditor  Representative may interplead any payment or
distribution in any court of competent jurisdiction.

               (c)  Each  Party  is  hereby   authorized   to  demand   specific
performance of this Agreement, whether or not the Issuers or any Guarantor shall
have complied with any of the  provisions  hereof  applicable to it, at any time
when any other Party shall have  failed to comply  with the  provisions  of this
Agreement  applicable to it,  provided that, the remedy of specific  performance
shall not be available,  and the asserting Party shall be free to assert any and
all legal defenses it may possess,  if such remedy would result in, or otherwise
constitute,  a violation of the Employee Retirement Income Security Act of 1974,
as  amended.  Each Party  hereby  irrevocably  waives any  defense  based on the
adequacy of a remedy at law,  which might be asserted as a bar to such remedy of
specific performance.

               (d) Upon the earlier to occur of (x) the  Refinancing and (y) ten
Business Days after the date hereof,  (i) the Trustee and the applicable  Senior
Lien  Creditor  Representative  shall enter into a control  agreement or control
agreements  with  respect to the deposit  accounts of any Issuer or Guarantor at
any financial  institution,  constituting  part of the  Collateral,  in form and
substance  reasonably  acceptable  to the Trustee and such Senior Lien  Creditor
Representative,  which shall supersede any existing control  agreements  between
the Trustee and such financial institution, and (ii) the Trustee and such Senior
Lien  Creditor  Representative  agrees to  terminate  or amend and restate  such
existing control agreements.

               (e)  This  Agreement   shall  continue  to  be  effective  or  be
reinstated, as the case may be, if at any time any payment of any of the Secured
Liabilities  is,  other  than as a  result  of any  intentional  fraud  or gross
negligence of the applicable  Party,  rescinded or must otherwise be returned by
the applicable Party upon the insolvency,  bankruptcy or  reorganization  of the
Issuers or any Guarantor or  otherwise,  all as though such payment had not been
made.

         Section 4.2 Perfection of Possessory or Control Security Interests. (a)
For the limited  purpose of perfecting the security  interests of the Parties in
those  types or items of  Collateral  in which a security  interest  only may be
perfected by possession or control (including  perfection of a security interest
in deposit accounts under Article 9 of the Uniform  Commercial Code), each Party
hereby  appoints  the other as its  representative  for the  limited  purpose of
possessing or controlling on its behalf any such

                                       14
<PAGE>

Collateral that may come into the possession or control of such other Party from
time to time,  and each Party  agrees to act as the other's  representative  for
such limited purpose of perfecting the other's  security  interest by possession
or control through a  representative,  provided that,  neither Party shall incur
any  liability  to the other by virtue of acting as the  other's  representative
hereunder for such purpose.  In this regard,  any Party that is in possession or
control of any such item of  Collateral  agrees that if it elects to  relinquish
possession or control of such item of Collateral it shall deliver  possession or
control  thereof to another Party;  provided that, no Party shall be required to
deliver any such item of Collateral or take any other action referred to in this
Section 4.2 to the extent that such action would  contravene  any law,  order or
other legal  requirements,  and in the event of a controversy  or dispute,  such
Party  may  interplead  any  item  of  Collateral  in  any  court  of  competent
jurisdiction.

               (b) The Senior  Lien  Creditor  Representatives  and the  Trustee
agree that if a Senior Lien Creditor  Representative  shall enter into a control
agreement with respect to any security  account or deposit  account of an Issuer
or a Guarantor, the Trustee will be given notice by such Issuer or Guarantor and
sufficient  opportunity  to also become a party  thereto in order to perfect its
security interest in such accounts. If and to the extent such control agreements
provide  for  the  right  of  either  the   applicable   Senior  Lien   Creditor
Representative  or the Trustee to give notice or direction to the  depository or
intermediary,  as applicable,  with respect to such accounts, the Trustee hereby
agrees  that,  subject  to  Section  3.2,  it will not give any such  notice  or
direction to any such  depository  or  intermediary  unless and until all Credit
Facility Indebtedness has been Fully Paid. The duties or responsibilities of the
Senior Lien  Creditor  Representatives  under this  Section 4.2 shall be limited
solely to holding the pledged  Collateral as bailee for the Trustee for purposes
of  perfecting  the Lien therein held by the Trustee to secure the  Subordinated
Lien Obligations.  The Senior Lien Creditor  Representatives  shall not have any
obligation  to the  Trustee  or any  Holder to care for,  protect  or insure any
pledged  Collateral  or to ensure that the Lien on such pledged  Collateral  has
been properly or  sufficiently  created or entitled to any particular  priority.
The Senior  Lien  Creditor  Representative  shall be  entitled  to deal with the
pledged Collateral in accordance with the terms of the Senior Lien Documents and
this  Agreement.  The Senior  Lien  Creditor  Representative  shall not have any
obligation  whatsoever  to the Trustee or the Holders to assure that the pledged
Collateral  is genuine or owned by any Issuer or  Guarantor  or  otherwise or to
preserve  rights or benefits of any Person except as expressly set forth in this
Section.  The Senior Lien Creditor  Representative  shall not have, by reason of
this Agreement or any other document or instrument,  a fiduciary relationship in
respect of the Trustee or the Holders.

          Section 4.3 Control of  Dispositions  of Collateral and Effect thereof
on Junior Liens.

               (a) Each Party  hereby  agrees that any Uniform  Commercial  Code
collection, sale, or other disposition of Collateral by any Senior Lien Creditor
Representative  shall be free  and  clear  of any  Lien of the  Trustee  in such
Collateral;  provided  that,  the Trustee  shall  retain a Lien (having the same
priority  as the  Lien it  previously  had on the  item of  Collateral  that was
collected, sold or otherwise disposed of)

                                       15
<PAGE>

on the proceeds of such collection,  sale, or other  disposition  (except to the
extent such proceeds are applied to the Credit Facility  Indebtedness (up to the
Maximum Credit Facility Amount) in accordance with Section 3.4).

               (b) To the extent  reasonably  requested by any Party,  the other
Parties will  cooperate in providing  any necessary or  appropriate  releases to
permit a collection,  sale, or other  disposition of Collateral,  as provided in
Section 4.3(a).

         Section 4.4 Certain Other  Collateral.  Subject to Section 4.1(c),  any
provision  of any  Indenture  Security  Document  that  requires  any Debtor (as
defined in the Security  Agreement  referred to in the Indenture) to (a) deliver
any  Collateral to the Trustee or any Senior Lien Creditor  Representative,  (b)
provide that the Trustee or any Senior Lien Creditor Representative have control
(as defined in the Uniform Commercial Code) over any Collateral, or (c) list the
Trustee  or any  Senior  Lien  Creditor  Representative  as (x)  loss  payee  or
additional  insured  on any  insurance  policy  or (y)  sole  lienholder  on any
certificate  of title  relating to any  Collateral,  may be satisfied by (A) the
delivery  of  such  Collateral  by  such  Debtor  to any  Senior  Lien  Creditor
Representative  (or its  designee),  (B) providing that any Senior Lien Creditor
Representative  (or its  designee)  be provided  with control (as defined in the
Uniform  Commercial  Code) with respect to such  Collateral,  or (C) listing any
Senior  Lien  Creditor  Representative  (or its  designee)  as (x) loss payee or
additional  insured  on any  insurance  policy  or (y)  sole  lienholder  on any
certificate of title relating to Collateral,  in each of the foregoing  cases in
clauses (A),  (B) and (C),  for the benefit of all of the Senior Lien  Creditors
and the Trustee.

                                    ARTICLE V
                                  MISCELLANEOUS

         Section 5.1 Rights of  Subrogation.  The Trustee agrees that no payment
or distribution  to any Senior Lien Creditor  pursuant to the provisions of this
Agreement  shall  entitle the Trustee to exercise any rights of  subrogation  in
respect thereof until the first date on which the Maximum Credit Facility Amount
of all the Senior Lien Documents shall have been Fully Paid.

         Section 5.2 Further Assurances.  The Parties will, at their own expense
and at any time and from time to time,  promptly execute and deliver all further
instruments and documents, and take all further action, that may be necessary or
desirable,  or that any Party may  reasonably  request,  in order to protect any
right or interest  granted or  purported  to be granted  hereby or to enable any
Party to exercise and enforce its rights and remedies hereunder;  provided that,
no Party shall be required to pay over any payment or distribution,  execute any
instruments or documents,  or take any other action  referred to in this Section
5.2 to the extent  that such action  would  contravene  any law,  order or other
legal requirement  binding upon such Party, and in the event of a controversy or
dispute,  any Party may interplead any payment or  distribution  in any court of
competent  jurisdiction,  without  further  responsibility  in  respect  of such
payment or distribution  under this Section 5.2. Without limiting the foregoing,
but in  furtherance  thereof,  the Trustee  agrees,  upon the request of the New
Revolver  Agent,  to  execute  and  deliver  to the New  Revolver  Agent (or its
designees) a subordination of mortgage,

                                       16
<PAGE>

subordination of preferred ship mortgage and subordination of trademark security
interests,   in  each  case  in  form  to  be  recordable  with  the  applicable
governmental   authorities  and  otherwise  in  form  and  substance  reasonable
acceptable to the New Revolver Agent and the Trustee.

         Section  5.3  Defenses  Similar to  Suretyship  Defenses.  All  rights,
interests,  agreements  and  obligations  of  each  of the  Parties  under  this
Agreement, shall remain in full force and effect irrespective of:

               (a) any change in the time,  manner or place of payment of, or in
any other term of, all or any of the Secured Liabilities, or any other amendment
or waiver of or any consent to departure from the Financing Documents;  provided
that,  this  clause  (a)  shall not apply  to,  and the  Trustee's  Liens in the
Collateral shall not be subordinated in priority by virtue of this Agreement to,
any Senior Lien  Creditor  Representative's  Liens  therein if and to the extent
that the Credit  Facility  Indebtedness  applicable to such Senior Lien Creditor
Representative's Senior Lien Documents is increased, without the express written
consent of the Trustee,  to an amount in excess of the applicable Maximum Credit
Facility Amount for such Senior Lien Document;

               (b) any exchange,  release,  non-enforcement or non-perfection of
any Party's Liens with respect to any Collateral,  or any release,  amendment or
waiver of or  consent  to  departure  from any  guaranty,  for all or any of the
Secured Liabilities; or

               (c) any  failure by any Party to  marshal  assets in favor of any
other  Party or any other  Person or to proceed  upon or against or exhaust  any
security or remedy before proceeding to enforce the Financing Documents.

         Section 5.4 Waiver. Except as otherwise provided in Section 2.1 and the
other provisions  hereof, to the maximum extent permitted by applicable law, the
Trustee hereby  waives,  solely with respect to the Collateral to which the Lien
Priority relates, any failure, omission, delay or lack on the part of any Senior
Lien  Creditor  to  enforce,  assert  or  exercise  any  right,  power or remedy
conferred  on such Senior Lien  Creditor in any of the Senior Lien  Documents or
the  inability  of such Senior Lien  Creditor  to enforce any  provision  of the
Senior Lien Documents or this Agreement.

         Section 5.5 Amendments, Etc. No amendment or waiver of any provision of
this  Agreement  nor consent to any departure by any Party shall in any event be
effective unless the same shall be in writing and signed by each Party, and then
such waiver or consent shall be effective only in the specific  instance and for
the specific  purpose for which given;  provided that,  neither  Section 4.4 nor
this Section 5.5 may be amended or otherwise  modified without the prior written
consent of the Issuers.

         Section 5.6  Addresses  for  Notices.  All  demands,  notices and other
communications  provided  for  hereunder  shall  be in  writing  and,  if to the
Trustee,  mailed or sent by  telecopy or  delivered  to it,  addressed  to it as
follows:

                                       17
<PAGE>

                  U.S. Bank National Association
                  60 Livingston Avenue
                  St. Paul, MN 55107
                  Attention:  Corporate Trust Department
                  Facsimile:  (651) 495-8097

and if to any Senior Lien Creditor Representative, mailed or sent by telecopy or
delivered  to such  Senior  Lien  Creditor  Representative,  addressed  to it as
follows:

                  Wells Fargo Foothill, Inc.
                  2450 Colorado Avenue, Suite 3000W
                  Santa Monica, CA  90404
                  Attention:  Business Finance Division Manager
                  Facsimile:  (310) 453-7313

         With a copy to:

                  Paul Hastings Janofsky & Walker, LLP
                  600 Peachtree Street, NE, Suite 2400
                  Atlanta, GA  30308
                  Attention:  Cindy J. K. Davis, Esq.
                  Facsimile:  (404) 815-2424

or as to any Party at such other address as shall be designated by such Party in
a written notice to the other parties complying as to delivery with the terms of
this Section 5.6. All such demands,  notices and other  communications  shall be
effective:  when mailed,  two business days after deposit in the mails,  postage
prepaid;  when sent by telecopy,  when receipt is  acknowledged by the receiving
telecopy  equipment  (or at the opening of the next  business  day if receipt is
acknowledged  after normal business hours);  or when delivered,  as the case may
be, addressed as aforesaid.

         Section 5.7 No Waiver of Remedies.  No failure on the part of any Party
to exercise, and no delay in exercising,  any right hereunder shall operate as a
waiver thereof;  nor shall any single or partial exercise of any right hereunder
preclude  any other or further  exercise  thereof or the  exercise  of any other
right.  The remedies  herein  provided are  cumulative  and not exclusive of any
remedies provided by law.

         Section  5.8  Continuing  Agreement.  This  Agreement  is a  continuing
agreement  and shall (a) be binding  upon the Parties and their  successors  and
assigns   (including  all  Holders  and  all  Persons  that  become  lenders  or
participants  under the Senior Lien Documents),  and (b) inure to the benefit of
and be  enforceable by the Parties,  the Holders,  the Senior Lien Creditors and
their respective successors, transferees and assigns.

         Section 5.9 Governing Law;  Entire  Agreement.  This Agreement shall be
governed by, and construed in accordance with, the laws of the State of New York
including  Sections 5-1401 and 5-1402 of the New York General  Obligations  Law,
except  as  otherwise  preempted  by  applicable  federal  law.  This  Agreement

                                       18
<PAGE>

constitutes  the entire  agreement  and  understanding  among the  Parties  with
respect to the  subject  matter  hereof  and  supersedes  any prior  agreements,
written or oral, with respect thereto.

         Section 5.10 Counterparts. This Agreement may be executed in any number
of  counterparts,  and it is not necessary that the signatures of all Parties be
contained on any one counterpart  hereof,  each counterpart will be deemed to be
an original, and all together shall constitute one and the same document.

         Section 5.11 No Third Party  Beneficiary.  This Agreement is solely for
the benefit of the Parties (and their successors and assigns) and the holders of
the Secured  Liabilities  (including the Senior Lien Creditors and the Holders).
No other Person  (including  the Issuers,  any  Guarantor or any  subsidiary  or
affiliate of the Issuers,  except the Issuers and Guarantors solely with respect
to  Section  4.4 and the  proviso  to  Section  5.5)  shall  be  deemed  to be a
third-party  beneficiary  of this  Agreement or shall have any rights to enforce
any provisions hereof.

         Section  5.12  Headings.  The  headings of the articles and sections of
this  Agreement are inserted for purposes of  convenience  only and shall not be
construed to affect the meaning or construction of any of the provisions hereof.

         Section 5.13  Severability.  If any of the provisions in this Agreement
shall, for any reason, be held invalid, illegal or unenforceable in any respect,
such  invalidity,  illegality  or  unenforceability  shall not  affect any other
provision of this  Agreement and shall not  invalidate  the Lien Priority or any
other priority set forth in this Agreement.

         Section 5.14  Trustee  Status.  Notwithstanding  any term herein to the
contrary,   it  is  hereby   expressly   agreed   and   acknowledged   that  the
lien-subordination  and related  agreements  set forth herein by the Trustee are
made solely in its capacity as trustee and collateral  agent under the Indenture
Documents and with respect to the Notes issued under the  Indenture  (and not in
its individual commercial capacity, except to the extent that it is or becomes a
Holder of any such Note). The Trustee shall not have any duties, obligations, or
responsibilities  to any  Senior  Lien  Creditor  or any  Senior  Lien  Creditor
Representative  under  this  Agreement  except as  expressly  set forth  herein.
Nothing  in this  Agreement  shall be  construed  to  operate as a waiver by the
Trustee,  with  respect to the  Issuers or any holder of any  Subordinated  Lien
Indebtedness,  of the  benefit  of  any  exculpatory  provisions,  presumptions,
indemnities,  protections,  benefits, immunities or reliance rights contained in
the Indenture,  and, by its acknowledgment  hereof, each Issuer expressly agrees
that as between itself and the Trustee, the Trustee shall have such benefit with
respect to all actions or omissions by the Trustee  pursuant to this  Agreement.
For all purposes of this  Agreement,  the Trustee may (a) rely in good faith, as
to matters of fact, on any  representation of fact believed by the Trustee to be
true  (without  any duty of  investigation)  and that is  contained in a written
certificate  of any  authorized  representative  of the Issuers or of any Senior
Lien  Creditor  or any Senior  Lien  Creditor  Representative,  (b) rely in good
faith, as to matters of law, on any advice received from its legal counsel or an
opinion of its  counsel,  counsel to the  Issuers or

                                       19
<PAGE>

counsel to any Senior Lien Creditor or any Senior Lien Creditor  Representative,
and shall  have no  liability  for any  action  or  omission  taken in  reliance
thereon,  and (c) assume in good faith (without any duty of investigation),  and
rely upon,  the  genuineness,  due  authority,  validity,  and  accuracy  of any
certificate,  instrument, notice, or other document believed by it in good faith
to be genuine and presented by the proper person.

         Section 5.15 New Revolver.  (a) Each of the Parties hereby acknowledges
and agrees that,  upon  consummation  of the  Refinancing,  (a) the New Revolver
Agent shall be, and each of the DJL Lender and the OED Lender shall cease to be,
a Senior Lien Creditor and/or a Senior Lien Creditor  Representative  hereunder;
and (b) the New Revolver  Documents shall  constitute,  and each of the Existing
Revolver Documents shall cease to constitute,  Senior Lien Documents  hereunder,
in each case, automatically and without further consent of any Party.

               (b) The Parties agree that,  notwithstanding  anything  herein to
the contrary,  in connection with the Refinancing,  the FF&E Secured Liabilities
and the New  Revolver  Secured  Liabilities  may be evidenced by a common set of
agreements, instruments and other documents, and if so evidenced, all references
herein to the FF&E Loan  Documents  shall be  deemed  to be  references  to such
agreements,  instruments  and other documents as they relate to the FF&E Secured
Liabilities,  and all references herein to the New Revolver Loan Documents shall
be deemed to be references to such  agreements,  instruments and other documents
as they relate to the New Revolver Secured Liabilities.  In furtherance thereof,
all references to the FF&E Agent, the FF&E Lenders, the FF&E Borrowers, the FF&E
Credit Agreement,  the New Revolver Agreement,  the New Revolver Lenders and the
New Revolver Agent shall be construed in like manner, mutatis mutandis.

                            [signature pages follow]

                                       20
<PAGE>

         IN WITNESS  WHEREOF,  each Party has caused this  Agreement  to be duly
executed and delivered as of the date first above written.

                                         WELLS FARGO FOOTHILL, INC.,
                                         as FF&E Agent, OED Lender, DJL Lender
                                         and New Revolver Agent

                                         By:   /s/  Todd R.  Nakamoto
                                            ------------------------------------
                                            Name:  Todd R.  Nakamoto
                                            Title:  Vice President

                                         U.S. BANK NATIONAL ASSOCIATION,
                                         as Trustee

                                         By:    /s/  Frank P. Leslie, II
                                            ------------------------------------
                                            Name:   Frank P. Leslie, II
                                            Title:  Vice President

<PAGE>

                                 ACKNOWLEDGMENT

         Each of the undersigned hereby  acknowledges that (a) it has received a
copy of the foregoing Intercreditor  Agreement,  dated as of April 16, 2004 (the
"INTERCREDITOR   AGREEMENT";   undefined   capitalized   terms   used   in  this
Acknowledgment   have  the  meanings  assigned  to  them  in  the  Intercreditor
Agreement),  by and among U.S. Bank National Association,  as Trustee, and Wells
Fargo  Foothill,  Inc., as FF&E Agent,  OED Lender,  DJL Lender and New Revolver
Agent, and consents thereto,  and agrees to recognize all rights granted thereby
to the Parties, and will not do any act or perform any obligation that is not in
accordance with the agreements set forth in such  Intercreditor  Agreement;  and
(b) it is not an  intended  beneficiary  or third  party  beneficiary  under the
Intercreditor  Agreement (other than with respect to Section 4.4 and the proviso
to Section 5.5 thereof).

         Dated as of the date first above written.

                                         DIAMOND JO, LLC, as an Issuer

                                         By:   /s/  M. Brent Stevens
                                            ------------------------------------
                                            Name:   M. Brent Stevens
                                            Title:  Chief Executive Officer

                                         THE OLD EVANGELINE DOWNS CAPITAL CORP.,
                                         as an Issuer

                                         By:   /s/  M. Brent Stevens
                                            ------------------------------------
                                            Name:   M. Brent Stevens
                                            Title:  Chief Executive Officer

                                         OED ACQUISITION, LLC,
                                         as a Guarantor

                                         By:   /s/  M. Brent Stevens
                                            ------------------------------------
                                            Name:  M. Brent Stevens
                                            Title: Chief Executive Officer

                                         THE OLD EVANGELINE DOWNS, L.L.C.,
                                         as a Guarantor

                                         By:   /s/  M. Brent Stevens
                                            ------------------------------------
                                            Name:  M. Brent Stevens
                                            Title: Chief Executive Officer

<PAGE>

                                         PENINSULA GAMING CORP.,
                                         as a Guarantor

                                         By:   /s/  M. Brent Stevens
                                            ------------------------------------
                                            Name:  M. Brent Stevens
                                            Title: Chief Executive OfficerExhibit 4.9B

                                 ACKNOWLEDGMENT

            The undersigned hereby  acknowledges that (a) it has received a copy
of the  foregoing  Intercreditor  Agreement,  dated as of April  16,  2004  (the
"INTERCREDITOR   AGREEMENT";   undefined   capitalized   terms   used   in  this
Acknowledgment   have  the  meanings  assigned  to  them  in  the  Intercreditor
Agreement), by and among U.S. Bank National Association,  as Trustee and Secured
Party,  and Wells Fargo  Foothill,  Inc., as Credit  Facility Lender (as defined
below), and consents thereto, and agrees to recognize all rights granted thereby
to the Parties, and will not do any act or perform any obligation that is not in
accordance with the agreements set forth in such  Intercreditor  Agreement;  and
(b) it is not an  intended  beneficiary  or third  party  beneficiary  under the
Intercreditor Agreement.

                                            Dated June 16, 2004.

<PAGE>

                                            PENINSULA GAMING, LLC, as an Issuer

                                            By:   /s/ M. Brent Stevens
                                               ---------------------------------
                                               Name:  M. Brent Stevens
                                               Title: Chief Executive Officer

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