Document:

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                                                                    Exhibit 4.28

                                    GUARANTY

     THIS GUARANTY (this "Guaranty"), made as of the 12th day of July, 2002, by
Gold Dust West Casino, Inc., a Nevada corporation ("Gold West"), and Diversified
Opportunities Group, Ltd., an Ohio limited liability company ("Diversified")
(Gold West and Diversified each individually a "Guarantor" and collectively the
"Guarantors") in favor of Foothill Capital Corporation (the "Lender").

                              W I T N E S S E T H:

     WHEREAS, pursuant to that certain Loan and Security Agreement of even date
herewith (as amended, restated, supplemented or otherwise modified from time to
time, the "Loan Agreement", all capitalized terms not defined herein being
defined in the Loan Agreement) among Jacobs Entertainment, Inc., a Delaware
corporation, ("Parent"), and each of Parent's Subsidiaries identified on the
signature pages thereof (such Subsidiaries, together with Parent, referred to
thereinafter each individually as a "Borrower", and individually and
collectively, jointly and severally, as the "Borrowers"), and the Lender, the
Lender has agreed to make loans and other financial accommodations to the
Borrowers from time to time pursuant to the terms and conditions thereof;

     WHEREAS, it is a condition precedent to the closing of the Loan Agreement
that the Guarantors execute and deliver this Guaranty in favor of the Lender in
order to secure the prompt and complete payment, observance and performance of
all of the Obligations of the Borrowers (including, without limitation, any
interest, fees and other charges in respect of the Loan Agreement and the other
Loan Documents that would accrue but for an Insolvency Proceeding, with respect
to the Borrower, whether or not such claim is allowed in such Insolvency
Proceeding); and

     WHEREAS, each Guarantor is a direct Subsidiary (as defined in the Loan
Agreement) of certain of the Borrowers, and, in the case Diversified, a holder
of ownership interest in one or more of the Borrowers, and each Guarantor has
determined that its execution, delivery and performance of this Guaranty
directly or indirectly benefits, and is within the corporate or other purposes
and in the best interests of, such Guarantor;

     NOW, THEREFORE, for and in consideration of the recitals made above, and
other good and valuable consideration, the receipt, sufficiency and adequacy of
which are hereby acknowledged, each Guarantor hereby agrees that capitalized
terms used herein and not otherwise defined herein are used as defined in the
Loan Agreement, and further agrees as follows:

                                       -1-

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     1. Each Guarantor hereby unconditionally guarantees, subject to the
limitations set forth in Section 7 hereof, to the Lender the full and prompt
payment of the Obligations (including, without limitation, interest, fees and
other charges, in respect of the Loan Agreement and the other Loan Documents
that would accrue but for an Insolvency Proceeding, with respect to the
Borrower, whether or not such claim is allowed in such Insolvency Proceeding),
plus reasonable attorneys' fees and expenses if the obligations represented by
this Guaranty are collected by law, through an attorney-at-law, or under advice
therefrom. Each Guarantor expressly agrees to pay to Lender, without demand, the
entire outstanding Obligations if at any time the Obligations are declared to be
immediately due and payable.

     2. Regardless of whether any proposed guarantor or any other Person shall
become in any other way responsible to the Lender for or in respect of the
Obligations or any part thereof, and regardless of whether or not any Person now
or hereafter responsible to the Lender for the Obligations or any part thereof,
whether under this Guaranty or otherwise, shall cease to be so liable, each
Guarantor hereby declares and agrees that this Guaranty shall be a joint and
several obligation, shall be a continuing guaranty and shall be operative and
binding until the Obligations shall have been indefeasibly and fully and finally
paid or otherwise satisfied to the satisfaction of the Lender and all
obligations of the Lender to extend any additional credit under the Loan
Agreement (the "Commitments") shall be terminated.

     3. Upon this Guaranty being executed and coming into the hands of the
Lender, this Guaranty shall be deemed to be finally executed and delivered by
each Guarantor and shall not be subject to or affected by any promise or
condition affecting or limiting any Guarantor's liability, except as stated in
the Loan Agreement, and no statement, representation, agreement or promise on
the part of the Lender, the Borrower, any Guarantor, or any of them, or any
officer, employee or agent thereof, unless contained herein, forms any part of
this Guaranty or has induced the making thereof or shall be deemed in any way to
affect any Guarantor's liability hereunder. Each Guarantor absolutely,
unconditionally and irrevocably waives any and all right to assert any defense,
set-off, counterclaim or cross-claim of any nature whatsoever (other than
absence of a Default or Event of Default or payment in full in cash) with
respect to this Guaranty or the obligations of any Guarantor under this Guaranty
or the obligations of any other Person or party (including, without limitation,
the Borrower) relating to this Guaranty or the obligations of any Guarantor
under this Guaranty or otherwise with respect to the Obligations in any action
or proceeding brought by the Lender hereof to collect the Obligations or any
portion thereof, or to enforce the obligations of any Guarantor under this
Guaranty.

     4. The Lender may from time to time, without exonerating or releasing any
Guarantor in any way under this Guaranty, (i) take such further or other
security or securities for the Obligations or any part thereof as it may deem
proper, or (ii) release, discharge, abandon or otherwise deal with or fail to
deal with any Guarantor of the

                                       -2-

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Obligations or any collateral, security or securities therefor or any part
thereof now or hereafter held by the Lender or (iii) amend, modify, extend,
accelerate or waive in any manner any of the provisions, terms, or conditions of
the Loan Documents, all as Lender may consider expedient or appropriate in its
sole discretion. Without limiting the generality of the foregoing, or of Section
5 hereof, it is understood that the Lender may, without exonerating or releasing
any Guarantor, relinquish, or modify or abstain from perfecting or taking
advantage of any security for the Obligations and accept or make any
compositions or arrangements and, subject to the Intercreditor Agreement,
realize upon any security for the Obligations when, and in such manner, and with
or without notice, all as such Person may deem expedient.

     5. Each Guarantor acknowledges and agrees that no change in the nature or
terms of the Obligations or any of the Loan Documents, or other agreements,
instruments or contracts evidencing, related to or attendant with the
Obligations (including any novation), shall discharge all or any part of the
liabilities and obligations of such Guarantor pursuant to this Guaranty; it
being the purpose and intent of each Guarantor and the Lender that the
covenants, agreements and all liabilities and obligations of each Guarantor
hereunder are absolute, unconditional and irrevocable under any and all
circumstances. Without limiting the generality of the foregoing, each Guarantor
agrees that until each and every one of the covenants and agreements of this
Guaranty is fully performed, and without possibility of recourse, whether by
operation of law or otherwise, each Guarantor's undertakings hereunder shall not
be released, in whole or in part, by any action or thing which might, but for
this paragraph of this Guaranty, be deemed a legal or equitable discharge of a
surety or guarantor, or by reason of any waiver or omission by the Lender or its
failure to proceed promptly or otherwise, or by reason of any action taken or
omitted by the Lender whether or not such action or failure to act varies or
increases the risk of, or affects the rights or remedies of, Guarantor or by
reason of any further dealings between the Borrower on the one hand and the
Lender, on the other hand or any other guarantor or surety, and each Guarantor
hereby expressly waives and surrenders any defense to its liability hereunder,
or any right of counterclaim or offset of any nature or description which it may
have or may exist based upon, and shall be deemed to have consented to, any of
the foregoing acts, omissions, things, agreements or waivers.

     6. Subject to the Intercreditor Agreement, the Lender may, without demand
or notice of any kind upon or to any Guarantor, at any time or from time to time
when any amount shall be due and payable hereunder by any Guarantor, if the
Borrower shall not have timely paid any of the Obligations, set-off and
appropriate and apply to any portion of the Obligations hereby guaranteed, and
in such order of application as the Lender may from time to time elect in
accordance with the Loan Agreement, any deposits, property, balances, credit
accounts or moneys of any Guarantor in the possession of the Lender, or under
its respective control for any purpose. The Lender shall endeavor to give notice
of such set-off to each Guarantor, but shall not be liable for the failure to do
so. If and to the extent that any guarantor makes any payment to the

                                       -3-

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Lender or any other Person pursuant to or in respect of this Guaranty, any
claim which any Guarantor may have against the Borrower by reason thereof shall
be subject and subordinate to the prior payment in full of the Obligations to
the satisfaction of the Lender.

     7. The creation or existence from time to time of Obligations in excess of
the amount committed to or outstanding on the date of this Guaranty is hereby
authorized, without notice to any Guarantor, and shall in no way impair or
affect this Guaranty or the rights of the Lender herein. It is the intention of
each Guarantor and the Lender that each Guarantor's obligations hereunder shall
be, but not in excess of, the Maximum Guaranteed Amount (as herein defined). The
"Maximum Guaranteed Amount" with respect to any Guarantor, shall mean the
maximum amount which could be paid by each Guarantor without rendering this
Guaranty void or voidable as would otherwise be held or determined by a court of
competent jurisdiction in any Insolvency Proceeding involving any state or
Federal bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or other similar laws relating to the insolvency of debtors.

     8. Upon the bankruptcy or winding up or other distribution of assets of the
Borrower or of any surety or guarantor (other than any Guarantor) for any
Obligations of the Borrower to the Lender, the rights of the Lender against any
Guarantor shall not be affected or impaired by the omission of the Lender to
prove its claim, or to prove the full claim, as appropriate, and the Lender may
prove such claims as it sees fit and may refrain from proving any claim and in
its discretion may value as it sees fit or refrain from valuing any security
held by it without in any way releasing, reducing or otherwise affecting the
liability to the Lender of any Guarantor.

     9. Any amount received by the Lender from whatsoever source and applied
toward the payment of the Obligations shall be applied consistent with the
provisions regarding the Obligations in accordance with the terms of the Loan
Agreement and Intercreditor Agreement.

     10.

          (a) Each Guarantor hereby unconditionally and irrevocably waives: (i)
notice of acceptance hereof, (ii) notice of any loans or other financial
accommodations made or extended under the Loan Agreement, or the creation or
existence of any of the additional Obligations, (iii) notice of the amount of
the Obligations, subject, however, to such Guarantor's right to make inquiry of
the Lender to ascertain the amount of the Obligations at any reasonable time;
(iv) notice of any adverse change in the financial condition of the Borrower or
of any other fact that might increase any Guarantor's risk hereunder; (v) notice
of presentment for payment, demand, protest, dishonor and notice thereof as to
any instrument among the Loan Documents; (vi) notice of any Default or Event of
Default under the Loan Agreement; (vii) all diligence in collection or
protection of or realization upon the Obligations or any part thereof, any
obligation hereunder, or

                                       -4-

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any security for any of the foregoing, (viii) all rights to enforce any remedy
which the Lender may have against the Borrower or any other guarantor; and (ix)
all other notices (except if such notice is specifically required to be given to
a Borrower or Guarantor under this Guaranty or any other Loan Document) and
demands to which any Guarantor might otherwise be entitled;

          (b) To the fullest extent permitted by applicable law, each Guarantor
hereby waives the right by statute or otherwise to require the Lender to
institute suit against the Borrower or any other guarantor or to exhaust any
rights and remedies which the Lender has or may have against the Borrower or any
other guarantor. Each Guarantor further waives any defense arising by reason of
any disability or other defense (other than the defense that there has been no
Default or Event of Default or the Obligations shall have been indefeasibly and
fully and finally paid and the Commitments have been terminated) of the Borrower
or any other guarantor or by reason of the cessation from any cause (other than
that the Obligations shall have been fully and finally paid and the Commitments
have been terminated) whatsoever of the liability of the Borrower or any other
guarantor in respect thereof;

          (c) No Guarantor shall be released or discharged, either in whole or
in part, by the Lender's failure or delay to (i) perfect or continue the
perfection of any lien or security interest in any collateral which secures the
obligations of the Borrower, any Guarantor, or any other guarantor, or (ii)
protect the property covered by such lien or security interest;

          (d) To the maximum extent permitted by law, each Guarantor hereby
waives: (i) any rights to assert against the Lender any defense (legal or
equitable), set-off, counterclaim, or claim which each such Guarantor may now or
at any time hereafter have against the Borrower or any other party liable to the
Lender on account of or with respect to the Obligations (other than the defense
that there has been no Default or Event of Default or that the Obligations shall
have been fully and finally paid and the Commitments have been terminated); (ii)
any defense, set-off, counterclaim, or claim, of any kind or nature, arising
directly or indirectly from the present or future sufficiency, validity, or
enforceability of the Obligations (other than the defense there has been no
Default or Event of Default or that the Obligations shall have been fully and
finally paid and the Commitments have been terminated); (iii) any defense
arising by reason of any claim or defense based upon an election of remedies by
the Lender; and (iv) any right to assert against the Lender any claim or defense
in relation to any requirement upon Lender to marshal any collateral for the
benefit of any Guarantor or any other person;

          (e) To the maximum extent permitted by law, each Guarantor hereby
waives, until such time as the Obligations are fully and finally paid and the
Commitments are terminated, any right of subrogation any such Guarantor has or
may have as against the Borrower or any other guarantor with respect to the
Obligations. In addition, each Guarantor hereby waives, until such time as the
Obligations are fully and finally paid and

                                       -5-

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the Commitments are terminated, any right to proceed against the Borrower or
any other guarantor, now or hereafter, for contribution, indemnity,
reimbursement, or any other suretyship rights and claims (irrespective of
whether direct or indirect, liquidated or contingent), with respect to the
Obligations. Each Guarantor also hereby waives any right to proceed or to seek
recourse against or with respect to any property or asset of the Borrower or any
other guarantor. Each Guarantor hereby agrees that, in light of the waivers
contained in this Section, no Guarantor shall be deemed to be a "creditor" (as
that term is defined in the Bankruptcy Code or otherwise) of the Borrower or any
other guarantor, whether for purposes of the application of Sections 547 or 550
of the United States Bankruptcy Code or otherwise;

          (f) No Guarantor shall be released or discharged, either in whole or
in part, by Lender's failure or delay to (i) perfect or continue the perfection
of any lien or security interest in any collateral which secures the obligations
of the Borrower, any Guarantor, or any other guarantor, or (ii) protect the
property covered by such lien or security interest;

          (g) If any of the Obligations at any time are secured by a mortgage or
deed of trust upon real property, the Lender may elect, in its sole discretion,
upon the occurrence and during the continuance of an Event of Default, to
foreclose such mortgage or deed of trust judicially or nonjudicially in any
manner permitted by law, before or after enforcing this Guaranty, without
diminishing or affecting the liability of any Guarantor hereunder. Understanding
that each Guarantor is hereby relinquishing a defense to the enforceability of
this Guaranty, each Guarantor hereby waives any right to assert against the
Lender any defense to the enforcement of this Guaranty, whether denominated
"estoppel" or otherwise, based on or arising from an election by the Lender
nonjudicially to foreclose any such mortgage or deed of trust. Each Guarantor
understands that the effect of the foregoing waiver may be that each Guarantor
may have liability, hereunder for amounts with respect to which each Guarantor
may be left without rights of subrogation, reimbursement, contribution, or
indemnity against the Borrower or any other guarantor or sureties; and

          (h) To the maximum extent permitted by law, each Guarantor waives any
duty on the part of the Lender to disclose to such Guarantor any facts the
Lender may now or hereafter know about any Borrower, regardless of whether the
Lender has reason to believe that any such facts materially increase the risk
beyond that which each Guarantor intends to assume, or has reason to believe
that such facts are unknown to any Guarantor, or has a reasonable opportunity to
communicate such facts to any Guarantor, since each Guarantor acknowledges that
such Guarantor is fully responsible for being and keeping informed of the
financial condition of the Borrower and all of the circumstances bearing on the
risk on nonpayment of any Obligations hereby guaranteed.

          (i) Notwithstanding any reference herein to the Intercreditor
Agreement or Lender's obligations thereunder, each Guarantor waives, to the
maximum extent

                                       -6-

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permitted by law, any claims or rights based on or relating to the
Intercreditor Agreement or compliance therewith by Lender, it being understood
that in no event shall (A) any Guarantor have any right to demand or require
compliance by Lender with the Intercreditor Agreement or (B) any such
obligations under the Intercreditor Agreement, or Lender's failure to comply
therewith, be a defense to the performance by any Guarantor of, or otherwise
limit any rights of Lender with respect to, any obligation of any Guarantor
hereunder.

     11. The Lender may, to the extent permitted under the Loan Agreement, sell,
assign or transfer all or any part of the Obligations, and in such event each
and every permitted assignee, transferee, or holder of all or any of the
Obligations, shall have the right to enforce this Guaranty, by suit or
otherwise, for the benefit of such permitted assignee, transferee or holder as
fully as if such assignee, transferee or holder were herein by name specifically
given such rights, powers and benefits.

     12. This Guaranty is a continuing guaranty of the Obligations and all
liabilities to which it applies or may apply under the terms hereof and shall be
conclusively presumed to have been created in reliance hereon. No failure or
delay by the Lender in the exercise of any right, power, privilege or remedy
shall operate as a waiver thereof, and no single or partial exercise by the
Lender of any right or remedy shall preclude other or further exercise thereof
or the exercise of any other right or remedy and no course of dealing between
any Guarantor and the Lender shall operate as a waiver thereof. The obligations
of each Guarantor hereunder shall remain in full force and effect without regard
to, and shall not be affected or impaired by the following, any of which may be
taken without the consent of, or notice to, any Guarantor, nor shall any of the
following give any Guarantor any recourse or right of action against the Lender:

          (a) Any bankruptcy, insolvency, reorganization, composition,
adjustment, dissolution, liquidation or other like proceeding relating to any
Guarantor or any Borrower, or any guarantor (which term shall include any other
party at any time directly or contingently liable for any of the Borrower'
obligations under the Loan Documents) or any affiliate of the Borrower, or any
action taken with respect to this Guaranty by any trustee or receiver, or by any
court, in any such proceeding, whether or not the Guarantor shall have had
notice or knowledge of any of the foregoing;

          (b) Any release or discharge of the Borrower from its liability under
any of the Loan Documents or any release or discharge of any endorser or
guarantor or of any other party at any time directly or contingently liable for
the Obligations;

          (c) Any subordination, compromise, release (by operation of law or
otherwise), discharge, compound, collection or liquidation of any or all of the
Collateral or other property described in any of the Loan Documents or otherwise
in any manner, or any substitution with respect thereto; and

          (d) Any acceptance of partial performance of the Obligations.

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     No action by the Lender permitted hereunder shall in any way impair or
affect this Guaranty. For the purpose of this Guaranty, the Obligations shall
include, without limitation, all Obligations of the Borrower to the Lender,
notwithstanding any right or power of any third party, individually or in the
name of the Borrower or the Lender to assert any claim or defense as to the
invalidity or unenforceability of any such Secured Obligation, and no such claim
or defense shall impair or affect the obligations of the Guarantor hereunder.

     13. This Guaranty shall be binding upon each Guarantor, its successors and
permitted assigns and inure to the benefit of the successors and assigns of the
Lender. No Guarantor may assign its rights or obligations under this Guaranty
without the prior written consent of the Lender. No alteration or waiver of this
Guaranty or of any of its terms, provisions or conditions shall be binding upon
the parties against whom enforcement is sought unless made in writing and signed
by an authorized officer of such party.

     14. This is a guaranty of payment and not of collection. In the event the
Lender makes a demand upon any Guarantor under this Guaranty, such Guarantor
shall be held and bound to the Lender directly as debtor in respect of the
payment of the amounts hereby guaranteed. All costs and expenses, including,
without limitation, actual and reasonable attorneys' fees and expenses, incurred
by the Lender in obtaining performance of or collecting payments due under this
Guaranty to the extent permitted by the Loan Agreement, shall be deemed part of
the Obligations guaranteed hereby. Any notice or demand given by the Lender
shall be served upon any Guarantor in the fashion prescribed for notices in the
Loan Agreement at the address for such Guarantor given on Exhibit A attached
hereto and the notice so sent shall be deemed to be served as set forth in the
Loan Agreement.

     15. Each Guarantor expressly represents and acknowledges that any financial
accommodations by the Lender to the Borrower, including, without limitation, the
extension of the Loans, are and will be of direct interest, benefit and
advantage to such Guarantor.

     16. Each Guarantor hereby covenants and agrees to comply with the
provisions of the Loan Agreement that are applicable to Subsidiaries of the
Borrower as if such covenants and agreements were specifically set forth herein.

     17. Each Guarantor hereby represents and warrants that:

          (a) such Guarantor is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization and has the
power and authority and the legal right to own and operate property, to lease
the property that such Guarantor operates and to conduct the business in which
such Guarantor is currently engaged;

                                       -8-

<PAGE>

          (b) such Guarantor has the power and authority and the legal right to
execute and deliver, and to perform its obligations under, this Guaranty and the
other Loan Documents to which it is a party, and has taken all necessary action
to authorize the execution, delivery and performance of this Guaranty and each
of the other Loan Documents to which it is a party;

          (c) this Guaranty and each of the other Loan Documents to which it is
a party constitutes a legal, valid and binding obligation of such Guarantor
enforceable in accordance with its terms;

          (d) the execution, delivery and performance of this Guaranty and the
other Loan Documents to which it is a party will not materially violate any
provision of any governmental requirement applicable to such Guarantor, the
Governing Documents of such Guarantor or any contractual obligation of such
Guarantor and will not result in or require the creation or imposition of any
Lien on the properties or revenues of such Guarantor pursuant to any
governmental requirement or contractual obligation of such Guarantor;

          (e) no consent or authorization of, filing with, or other act by or in
respect of, any arbitrator or governmental authority and no consent of any other
Person (including, without limitation, any partner, stockholder or creditor of
such Guarantor) is required in connection with the execution, delivery,
performance, validity or enforceability of this Guaranty or (except as provided
in such other Loan Documents) any other Loan Document to which it is a party
except such consent as has already been obtained;

          (f) no litigation, investigation or proceeding of or before any
arbitrator or governmental authority is pending or, to the knowledge of such
Guarantor, threatened by or against such Guarantor or against any of such
Guarantor's properties or revenues (1) with respect to this Guaranty or any
other Loan Document to which it is a party or any of the transactions
contemplated hereby or thereby, or (2) which could reasonably be expected to
cause a Material Adverse Change; and

          (g) the representations contained in the Loan Agreement, insofar as
such representations apply to such Guarantor, are true and correct.

          Each Guarantor agrees that the foregoing representations and
warranties shall be deemed to have been made by each Guarantor on the date of
each borrowing by the Borrower under the Loan Agreement on and as of such date
of borrowing as though made hereunder on and as of such date.

     18. Each Guarantor hereby irrevocably and unconditionally:

          (a) submits itself in any legal action or proceeding relating to this
Guaranty and the other Loan Documents to which it is a party, or for recognition
and

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<PAGE>

enforcement of any judgment in respect thereof, to the exclusive jurisdiction of
the state and federal courts located in the City of New York or the Southern
District of New York;

          (b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;

          (c) agrees that nothing herein shall affect the right for Lender to
effect service or process in any manner permitted by law or shall limit the
right of Lender to sue in any other jurisdiction.

     19. Notwithstanding anything herein to the contrary, to the extent that any
Guarantor makes any payment on the Obligations which, within twelve (12) months
of the date of such payment, is subsequently invalidated, declared to be
fraudulent, avoidable or preferential, set aside or is required to be repaid to
a trustee, receiver, the estate of such Guarantor or any other party under any
bankruptcy act, state or Federal law, common law or equitable cause (such
payment being hereinafter referred to as a "Voided Payment"), then to the extent
of such Voided Payment that portion of the Obligations which had been previously
satisfied by such Voided Payment shall be revived and continue in full force and
effect as if such Voided Payment had never been made. In the event that a Voided
Payment is sought to be recovered from the Lender, an "Event of Default" under
the Loan Agreement shall be deemed to have occurred and to be continuing from
the date of such recovery from the Lender of such Voided Payment until the full
amount of such Voided Payment is fully and finally restored to the Lender and
until such time the provisions of this Guaranty, and the guaranty provided
herein, shall be in full force and effect.

     20. EACH PARTY HEREBY KNOWINGLY, INTENTIONALLY, IRREVOCABLY AND
UNCONDITIONALLY, TO THE EXTENT PERMITTED BY LAW, AGREES AS FOLLOWS:

          (a) THE VALIDITY OF THIS GUARANTY, THE CONSTRUCTION, INTERPRETATION,
AND ENFORCEMENT HEREOF, AND THE RIGHTS OF THE PARTIES HERETO WITH RESPECT TO ALL
MATTERS ARISING HEREUNDER OR RELATED HERETO SHALL BE DETERMINED UNDER, GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

          (b) GUARANTORS AND LENDER HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A
JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
GUARANTY OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN, INCLUDING CONTRACT
CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR
STATUTORY CLAIMS. GUARANTORS AND LENDER

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REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY
WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE
EVENT OF LITIGATION, A COPY OF THIS GUARANTY MAY BE FILED AS A WRITTEN CONSENT
TO A TRIAL BY THE COURT.

     21. Upon payment in full of all the Obligations, termination of the
obligation of the Lender to make loans and other financial obligations under the
Loan Agreement and satisfaction in full of all other Obligations, this Guaranty
shall terminate and the Lender shall take all action reasonably requested by any
Guarantor (at the expense of the Borrower or the Guarantor) to evidence the
termination of this Guaranty.

     22. This Guaranty may be executed in any number of counterparts, each of
which shall be deemed to be an original, but all such separate counterparts
shall together constitute but one and the same instrument. Delivery of a
counterpart hereof by facsimile transmission shall be as effective as delivery
of a manually executed counterpart hereof.

     23. Each Guarantor hereby agrees that any notices to it may be made to the
Guarantor at its address set forth on Exhibit A hereto in the manner set forth
in the Loan Agreement.

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<PAGE>

     IN WITNESS WHEREOF, each Guarantor has executed this Guaranty as of the
date first above written.

GUARANTORS:

                                   GOLD DUST WEST CASINO, INC.
                                   a Nevada corporation

                                   By: /s/ Stephen R. Roark
                                     -------------------------------------------
                                              Stephen R. Roark
                                               Vice President

                                   DIVERSIFIED OPPORTUNITIES GROUP, LTD.
                                   an Ohio Limited Liability Company

                                   By:     JACOBS ENTERTAINMENT, INC.,
                                           a Delaware corporation,
                                           Its Manager

                                   By:  /s/ Stephen R. Roark
                                      ------------------------------------------
                                           Stephen R. Roark,
                                       Chief Financial Officer

Acknowledged and agreed to:

FOOTHILL CAPITAL CORPORATION
a California corporation,
as Lender

By: /s/ Stephen Schwartz
   --------------------------
Name:   Stephen Schwartz
     ------------------------
Title:   S.V.P.
      -----------------------

<PAGE>

                                    EXHIBIT A
                                       TO
                                    GUARANTY

                                Notice Addresses

If to Lender:     FOOTHILL CAPITAL CORPORATION
                                 2450 Colorado Avenue
                                 Suite 3000 West
                                 Santa Monica, California  90404
                                 Attn: Structured Finance Group
                                 Fax No. 310.453.7442

If to Guarantor:  GOLD DUST WEST CASINO, INC.
                  DIVERSIFIED OPPORTUNITIES GROUP, LTD.
                                 c/o The Lodge Casino
                                 240 Main Street
                                 P.O. Box 21
                                 Black Hawk, Colorado  80422
                                 Attn:  Stephen R. Roark
                                 Fax No. 303.582.0239<PAGE>

                                                                    Exhibit 4.29

                             INTERCREDITOR AGREEMENT

                  THIS INTERCREDITOR AGREEMENT, dated as of July 12, 2002 (this
"Agreement"), is made by and between WELLS FARGO BANK MINNESOTA, NATIONAL
ASSOCIATION, in its capacity as trustee under the Indenture (as defined below)
and the Collateral Documents (as defined in the Indenture) (together with its
successors in such capacities, the "Trustee"), and FOOTHILL CAPITAL CORPORATION,
as lender (the "Lender") under the Credit Agreement (as defined below).

                                    RECITALS

                  WHEREAS, Jacobs Entertainment, Inc. (f/k/a Gameco, Inc.), a
Delaware corporation (the "Company"), has issued $125,000,000 aggregate
principal amount of its 11 7/8% Senior Secured Notes due 2009 (together with any
additional 11 7/8% Senior Secured Notes due 2009 of the Company issued pursuant
to the Indenture including, without limitation, in exchange for outstanding
Notes, the "Notes") and certain of the Company's subsidiaries have guaranteed
the Notes (together with any future subsidiary guarantors, the "Guarantors" and
together with the Company, the "Issuers"), in each case pursuant to an Indenture
dated as of February 8, 2002 among the Issuers and the Trustee (the
"Indenture"). All of the Issuers' obligations under the Notes and the other
Indenture Documents (as defined below) are secured by liens on and security
interests in all of the now existing and hereafter acquired real and personal
property of the Issuers now or hereafter made subject to the Lien of the
Indenture Documents (the "Noteholder Collateral");

                  WHEREAS, as of July 12, 2002, certain of the Issuers and the
Credit Facility Secured Party (as defined below) entered into that certain Loan
and Security Agreement, dated as of July 12, 2002 (the "Credit Agreement"),
whereby the Credit Facility Secured Party 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, one or more Credit Parties,
in an aggregate principal and undrawn amount not to exceed the Maximum Amount
(as defined below), the repayment of which is secured by security interests in
and liens on the Credit Agreement Collateral (as defined below) in accordance
with the Credit Agreement and the collateral security documents, including deeds
of trust, instruments and guaranties executed and delivered in connection
therewith by the Credit Parties, and such other agreements, instruments and
certificates now or hereafter entered into in connection with the Credit
Agreement (the "Loan Documents");

                  WHEREAS, one of the conditions of the Credit Agreement is that
the priority of the security interests in and liens on the Credit Agreement
Collateral under the Credit Facility Loan Documents be senior to the security
interests in and liens on the Credit Agreement Collateral granted to the Trustee
for its benefit and for the benefit of the Holders (as hereinafter defined)
pursuant to the Indenture Documents in the manner and to the extent provided for
in this Agreement;

<PAGE>

                  WHEREAS, the Trustee and the Credit Facility Secured Party
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 Credit Agreement Collateral; and

                  WHEREAS, the terms of the Indenture permit the Issuers to
enter into the Credit Agreement and, in connection therewith, authorize and
direct the Trustee to enter into an intercreditor agreement in the form of this
Agreement.

                  NOW, THEREFORE, the Parties hereby agree as follows:

                                   ARTICLE I.

                                  DEFINITIONS

                  Section 1.1 Definitions. As used in this Agreement, the
following terms shall have the respective meanings set forth below:

                  "Agreement" means this Intercreditor Agreement.

                  "Company" has the meaning set forth in the recitals.

                  "Credit Agreement" has the meaning set forth in the recitals,
as the same may be amended, restated, extended, renewed, replaced, refinanced,
supplemented or otherwise modified from time to time.

                  "Credit Agreement Collateral" means the property and assets
described on Schedule I annexed hereto.

                  "Credit Facility Indebtedness" means all present and future
obligations, contingent or otherwise, of the Credit Parties to the Credit
Facility Secured Party arising under or pursuant to the Credit Facility Loan
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 Credit
Facility Secured Party in respect of the Credit Agreement Collateral in any
Insolvency Proceeding.

                  "Credit Facility Loan Documents" means the Credit Agreement
and the Loan Documents, as any or all of the same may be amended, modified,
restated, extended, renewed, replaced or refinanced or supplemented or otherwise
modified from time to time.

                  "Credit Facility Secured Party" means the Lender and each
Person now or hereafter owning all or part of the Credit Facility Indebtedness.

                  "Credit Parties" means the Company and those subsidiaries of
the Company that are a party to the Credit Facility Loan Documents.

                                       -2-

<PAGE>

                  "Enforcement Action" means, with respect to any Party, (a)
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
Credit Agreement Collateral, including commencement of any receivership or
Foreclosure Action against or any other sale of, collection on or disposition
of, any Credit Agreement Collateral, or any exercise of remedies with respect to
the Credit Agreement Collateral under the Indenture Documents or the Credit
Facility Loan Documents; or (b) notifying any third-party account debtors with
respect to Credit Agreement Collateral of any Issuer or any Credit Party or any
of their respective subsidiaries to make payment directly to such Party or to
any of its agents or other Persons acting on its behalf.

                  "Enforcement Event" means the occurrence and continuance of an
Event of Default.

                  "Enforcement Event Notice" has the meaning set forth in
Section 3.2(a).

                  "Entitled Party" has the meaning set forth in Section 4.1(a).

                  "Event of Default" has the meaning set forth in the Financing
Documents.

                  "Expiry Date" has the meaning set forth in Section 3.2(b).

                  "Financing Documents" means the Indenture Documents and the
Credit Facility Loan Documents.

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

                  "Fully Paid" means the payment in cash or cash equivalents in
full of all obligations (other than indemnity obligations that survive payment
in full) under the Credit Facility Loan Documents or the Indenture Documents, as
the case may be, and in the case of the Credit Facility Loan Documents, at such
time when there shall no longer be any obligation to make loans or advances or
issue letters of credit (or guaranties in respect thereof) thereunder and there
shall no longer be any letter of credit (or guaranty in respect thereof)
outstanding thereunder or such letter of credit (or guaranty in respect thereof)
shall have been fully cash collateralized (in accordance with the provisions of
the Credit Facility Loan Documents).

                  "Guarantors" has the meaning set forth in the recitals.

                  "Holders" means the registered holders of the Notes from time
to time.

                                       -3-

<PAGE>

                  "Indenture" has the meaning set forth in the recitals, as the
same may be amended, restated, extended, renewed, replaced, refinanced,
supplemented or otherwise modified from time to time.

                  "Indenture Documents" means the Indenture, the Notes, the
Collateral Documents and the Registration Rights Agreement, and such other
agreements, instruments and certificates executed and delivered (or issued) by
any Issuer pursuant to the Indenture or in connection therewith, as any or all
of the same may be amended, restated, extended, renewed, replaced, refinanced,
supplemented or otherwise modified from time to time.

                  "Insolvency Proceeding" means any proceeding for the purposes
of dissolution, winding up, liquidation, arrangement or reorganization of any
Issuer or any subsidiary of any Issuer, 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 any Issuer or any
subsidiary of an Issuer, or their respective successors or assigns.

                  "Issuers" has the meaning set forth in the recitals.

                  "Lender" has the meaning set forth in the preamble.

                  "Lien Priority" means, with respect to any Lien in and to the
Credit Agreement Collateral, the order of priority of such Lien as specified in
Sections 2.1 and 2.2.

                  "Loan Documents" has the meaning set forth in the recitals.

                  "Maximum Amount" has the meaning set forth in Section 2.1(b).

                  "Noteholder Collateral" has the meaning set forth in the
recitals.

                  "Party" means any signatory to this Agreement.

                  "Secured Liability" means the Subordinated Lien Indebtedness
and the Credit Facility Indebtedness.

                  "Subordinated Lien Indebtedness" means all present and future
obligations, contingent or otherwise, of the Issuers 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 iii such proceeding), and
including the secured claims of the Trustee or the Holders in respect of the
Credit Agreement Collateral in any Insolvency Proceeding.

                  "Trigger Date" means the earlier of (i) the date on which an
event contemplated by clause (b) or (c) of the definition of Trigger Event
occurs, (ii) the date on which an Enforcement Event Notice is delivered, and
(iii) the final maturity date of

                                       -4-

<PAGE>

the Credit Facility Indebtedness (after giving effect to any extensions granted
thereunder).

                  "Trigger Event" means:

                           (a) the occurrence of an Event of Default,

                           (b) the acceleration of the maturity of the Credit
Facility Indebtedness by the Credit Facility Secured Party pursuant to the
Credit Agreement, or

                           (c) the commencement of any action or proceeding by
the Credit Facility Secured Party, whether judicial or otherwise (but excluding
demands for payment or notices of default), for the enforcement of the Credit
Facility Secured Party's rights and remedies under any of the Credit Facility
Loan Documents, including (i) commencement of any receivership or Foreclosure
Action against or any other sale of, collection on or disposition of any Credit
Agreement Collateral, including any notification to third parties to make
payment directly to the Credit Facility Secured Party or to any of its agents or
other Person acting on its behalf; (ii) exercise of any right of set-off; (iii)
commencement of any Insolvency Proceeding; and (iv) commencement of any judicial
action or proceeding against any Issuer or any subsidiary of any Issuer to
recover all or any part of the Credit Facility Indebtedness.

                  "Trustee" has the meaning set forth in the preamble.

                  Section 1.2 Indenture Definitions. All other capitalized terms
that are used but not defined herein have the respective meanings ascribed to
such terms in the Indenture. Any modifications to such definitions which
adversely affect the Credit Facility Secured Party after the date hereof shall
not be effective under this Agreement without the consent of the Credit Facility
Secured Party.

                  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" means "including without limitation."

                                  ARTICLE II.

                                 LIEN PRIORITY

                  Section 2.1 Acknowledgment of Liens; Agreement to Subordinate
Liens.

                           (a)The Credit Facility Secured Party hereby
acknowledges that the Trustee has been granted Liens upon all of the Noteholder
Collateral (including,

                                       -5-

<PAGE>

without limitation, the Credit Agreement Collateral) pursuant to the Indenture
Documents and hereby represents and warrants to the Trustee that the Credit
Facility Secured Party has not been granted any Liens upon any Noteholder
Collateral other than the Credit Agreement Collateral. The Trustee hereby
acknowledges that the Credit Facility Secured Party has been granted Liens upon
all of the Credit Agreement Collateral pursuant to the Credit Facility Loan
Documents.

                           (b) The Trustee hereby agrees that the Liens of the
Trustee for the benefit of itself and the Holders in and to the Credit Agreement
Collateral are and shall be subordinate in priority to the Liens of the Credit
Facility Secured Party in and to the Credit Agreement Collateral securing the
Credit Facility Indebtedness up to, but not in excess of, $10,000,000 of
principal Indebtedness outstanding under the Credit Agreement and, in addition
thereto, related interest, fees, costs and expenses (such principal, together
with such additional amounts, the "Maximum Amount"); provided that the rights of
the Credit Facility Secured Party under this Agreement shall be void and of no
further force and effect if, and only to the extent that, the Liens of the
Credit Facility Secured Party in and to the Credit Agreement Collateral are
avoided, disallowed, set aside or otherwise invalidated in any action or
proceeding by a court, tribunal or administrative agency of competent
jurisdiction. The subordination of the Liens of the Trustee for the benefit of
itself and the Holders in and to the Credit Agreement Collateral in favor of the
Credit Facility Secured Party provided for herein shall not be deemed to (a)
subordinate the Liens of the Trustee to the Liens of any other Person; or (b)
subordinate the Subordinated Lien Indebtedness to any Indebtedness including the
Credit Facility Indebtedness.

                  Section 2.2 No 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 either Party may enforce its rights and
privileges hereunder without being deemed to have violated this provision.

                  Section 2.3 Exercise of Rights.

                           (a) For so long as the Credit Agreement is in effect,
and except as expressly set forth herein, and in all events subject to the terms
hereof, the right of the Credit Facility Secured Party to exercise any rights,
remedies or options with respect to all or any part of the Credit Agreement
Collateral, to conduct any and all proceedings with respect to all or any part
of the Credit Agreement Collateral, and to otherwise deal in or with all or any
part of the Credit Agreement Collateral shall be paramount to the rights of the
Trustee to do any such acts, and the Trustee shall take no action with respect
to the Credit Agreement Collateral inconsistent with this Agreement or that in
any way impairs the Credit Facility Secured Party's rights hereunder.

                           (b)The Trustee may exercise, and nothing herein shall
constitute a waiver of, any right it may have at law or in 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

                                       -6-

<PAGE>

Priority and the application of proceeds of Credit Agreement Collateral under
Section 3.4, and (ii) subject to the provisions of Sections 3.1 and 3.2.

                           (c) 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. 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 or any other reason
whatsoever, the Parties agree among themselves that (i) their respective Liens
in the Credit Agreement Collateral shall be governed by the Lien Priority, and
(ii) the Credit Facility Secured Party shall have no Liens (to the extent
arising out of an express grant of a security interest by any Credit Party) on
the Noteholder Collateral other than Credit Agreement Collateral. The agreement
set forth in clauses (i) and (ii) of the immediately preceding sentence and
elsewhere in this Agreement shall be controlling in the event of any conflict
between this Agreement and any of the Financing Documents.

                                 ARTICLE III.

                             ACTIONS OF THE PARTIES

                  Section 3.1 Limitation on Certain Actions. Subject to Section
3.2, until the earlier of (a) the date on which all Credit Facility Indebtedness
is Fully Paid, and (b) the first date following the date on which the Maximum
Amount of Credit Facility Indebtedness is Fully Paid, the Trustee will not,
without the prior written consent of the Credit Facility Secured Party, take any
Enforcement Action.

                  Section 3.2 Standstill Period.

                           (a) If an Enforcement Event has occurred and is
continuing, the Trustee, on behalf of the Holders, will give the Credit Facility
Secured Party written notice thereof (an "Enforcement Event Notice").

                           (b) The Trustee may, subject to the Lien Priority and
the application of all proceeds of the Credit Agreement Collateral in accordance
with Section 3.4, take one or more Enforcement Actions so long as:

                               (i) (A) an Enforcement Event is continuing for
more than 180 consecutive days after the delivery of such Enforcement Event
Notice (the "Expiry Date"), (B) the Credit Facility Secured Party has not, on or
before the Expiry Date, commenced one or more Enforcement Actions, and (C) no
Issuer against which the Trustee's proposed Enforcement Action is to be taken is
the subject of an Insolvency Proceeding; or

                                       -7-

<PAGE>

                               (ii) the Credit Facility Secured Party has
commenced any Enforcement Action or prior to the Expiry Date and, at any time
after the Expiry Date, is no longer pursuing any Enforcement Actions, (B) no
Insolvency Proceeding is pending against any Issuer against which the Trustee's
proposed Enforcement Action is to be taken, and (C) the Enforcement Event that
was the subject of, or existing on the date of, the Enforcement Event Notice is
then continuing.

                           (c) Except as expressly provided for in this
Agreement, nothing in this Agreement shall prevent the Parties hereto from
exercising any other remedy, or taking any other action, under any of the
Financing Documents.

                           (d) Notwithstanding any other provision of this
Agreement, the Credit Facility Secured Party waives any and all rights or
remedies relating to the Noteholder Collateral except the Credit Agreement
Collateral.

                  Section 3.3 Foreclosure. Any Party taking a permitted
Foreclosure Action may enforce its Financing Documents independently as to each
Issuer and each Credit Party and independently of any other remedy or security
(so long as such remedy or security does not conflict with the other provisions
of this Agreement) such Party at any time may have or hold in connection with
its Secured Liabilities, and it shall not be necessary for such Party to marshal
assets in favor of the 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 Credit Facility
Indebtedness is not Fully Paid) and the Credit Facility Secured Party (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 its
favor or to proceed against any Credit Agreement Collateral provided by any
Issuer or Credit Party and agrees that the Party taking such permitted
Foreclosure Action may proceed against any Issuer or Credit Party, any Credit
Agreement Collateral, in such order as it shall determine in its sole and
absolute discretion. The Credit Facility Secured Party expressly waives the
right to require the Trustee to marshal assets in its favor or to proceed
against any property, assets or collateral (other than Credit Agreement
Collateral) of, or provided by, any Issuer or Credit Party or any other Person
(such property, assets or collateral, including, without limitation, the
Noteholder Collateral but excluding the Credit Agreement Collateral, the "Other
Assets") and agrees that the Trustee may proceed against any Issuer, or Credit
Party or other Person or any Other Assets 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 Credit Agreement Collateral
governed by Article 9 of the Uniform Commercial Code, the Party conducting such
sale or other disposition agrees in favor of the other Party to conduct such
sale or other disposition in a commercially reasonable manner; (b) with respect
to the sale or other disposition of any other Credit Agreement Collateral, the
Party conducting such sale or other disposition agrees in favor of the other
Party that such sale or other disposition shall be conducted according to the
normal practices of commercial real property secured lenders generally; (c) with
respect to the sale or other disposition of any Credit Agreement Collateral by
either Party, such Party agrees to provide the other Party with such written
notice as it is required by applicable law (including, if applicable, the

                                       -8-

<PAGE>

Uniform Commercial Code) to provide to any Issuer or any Credit Party (without
regard to whether any Issuer or any Credit Party has waived its entitlement to
receive such notice); and (d) the Credit Facility Secured Party agrees that, at
such time as all Credit Facility Indebtedness is Fully Paid, the Credit Facility
Secured Party thereupon promptly shall cease all further Foreclosure Actions.

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

                           (a) First:

                               (i) if the Foreclosure Action is taken by the
Credit Facility Secured Party, to the payment of all reasonable costs and
expenses, commissions and taxes of the Credit Facility Secured Party incurred in
connection with taking any such Foreclosure Action or other realization,
including all reasonable expenses (including attorneys' fees and expenses),
liabilities and advances made or incurred by the Credit Facility Secured Party
in connection therewith;

                               (ii) if the Foreclosure 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 any such Foreclosure Action or other realization, including all
reasonable expenses (including attorneys' fees and expenses), liabilities and
advances made or incurred by the Trustee in connection therewith;

                           (b) Second, to the Credit Facility Secured Party,
until the earlier of (i) the Credit Facility Indebtedness being Fully Paid, and
(ii) the first time following the date at which the Maximum Amount of Credit
Facility Indebtedness is Fully Paid;

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

                           (d) Fourth, to the Credit Facility Secured Party
until all outstanding Credit Facility Indebtedness in excess of the Maximum
Amount is Fully Paid.

                  Section 3.5 Notice of Certain Events. Each Party agrees that
it will notify the other Party, in writing, if it receives actual notice of the
occurrence of a Trigger Event or Enforcement Event, not later than 30 days after
the date of actual notice of any such occurrence. The Trustee agrees that it
will provide the Credit Facility Secured Party written notice at least 15 days
prior to exercising any remedies with respect to any portion of the Credit
Agreement Collateral. The Credit Facility Secured Party will provide the Trustee
with such advance written notice as is reasonably practicable under the
circumstances prior to exercising any remedies with respect to any portion of
the Credit Agreement Collateral. Notwithstanding the foregoing, (a) the Credit
Facility

                                       -9-

<PAGE>

Secured Party shall not be obligated to provide such prior written notice if
exigent circumstances require that the Credit Facility Secured Party act
immediately in order to preserve, protect, or obtain possession or control over
the Credit Agreement Collateral or any portion thereof or such notice is not
reasonably practicable in the circumstances; provided that if the Credit
Facility Secured Party does not provide any advance written notice prior to
exercising any remedies with respect to any portion of the Credit Agreement
Collateral, the Credit Facility Secured Party agrees to provide the Trustee with
written notice as soon as practicable following the Credit Facility Secured
Party first exercising any of its secured creditor remedies with respect to the
Credit Agreement Collateral; and (b) 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.

                                  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 Credit Agreement Collateral that are received by any Party contrary to
the provisions of this Agreement shall be segregated from other funds and
property held by such Party and shall be held in trust for the Party entitled
thereto (the "Entitled Party") in accordance with the provisions of Section 3.4
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. In the event the Credit
Agreement Secured Party receives any payments or distributions of, or with
respect to, any Noteholder Collateral (other than Credit Agreement Collateral),
the Credit Agreement Secured Party shall segregate such payments or
distributions from other funds and property held by the Credit Agreement Secured
Party and such payments or distributions shall be held in trust for the Trustee
and the Credit Agreement Secured Party shall forthwith pay over such payments or
distributions to the Trustee in the same form as so received (with any necessary
endorsement) to be applied or held as collateral in accordance with the
provisions of the Indenture Documents.

                           (b) After the earlier of (i) the date on which all
Credit Facility Indebtedness is Fully Paid, and (ii) the first date following
the Trigger Date on which the Maximum Amount of Credit Facility Indebtedness is
Fully Paid, the Credit Facility Secured Party 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 hereunder, or in furtherance
thereof; provided that (x) the Credit Facility Secured Party shall not be
required to pay over any payment or distribution, execute any instruments or
documents,

                                      -10-

<PAGE>

or take any other action referred to in this Section 4.1(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, the Credit Facility Secured Party may
interplead any payment or distribution in any court of competent jurisdiction;
and (y) the Credit Facility Secured Party shall not incur any liability to the
Trustee for failure to provide any such further instruments and documents or
take any further acts, so long as the failure to provide any such further
instruments and documents or take any such further act was not the result of
malfeasance, willful misconduct or gross negligence.

                           (c) Each Party is hereby authorized to demand
specific performance of this Agreement, whether or not any Issuer or Credit
Party shall have complied with any of the provisions hereof applicable to it, at
any time when either 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) 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 any
Issuer or any Credit Party or otherwise, all as though such payment had not been
made.

                  Section 4.2 Perfection of Possessory Security Interests.

                           (a) For the limited purpose of perfecting the
security interests of the Parties in those types or items of Credit Agreement
Collateral in which a security interest only may be perfected by possession or
control, each Party hereby appoints the other as its representative for the
limited purpose of possessing on its behalf any such Credit Agreement 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. In this regard, any Party that is in possession or control of any
such item of Credit Agreement Collateral agrees that if it elects to relinquish
possession or control of such item of Credit Agreement Collateral it shall
deliver possession or control thereof to the other Party; provided that neither
Party shall be required to deliver any such item of Credit Agreement Collateral
or take any other action referred to in this section 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 Credit
Agreement Collateral in any court of competent jurisdiction.

                                      -11-

<PAGE>

                           (b) In the event the Credit Agreement Secured Party
receives any items or types of Noteholder Collateral (other than Credit
Agreement Collateral) in which a security interest may only be perfected by
possession or control, the Trustee hereby appoints the Credit Agreement Secured
Party as its representative for the limited purposes of possessing or
controlling on its behalf to perfect the Trustee's security interest therein,
any such Noteholder Collateral that may come into the possession or control of
the Credit Agreement Secured Party from time to time and the Credit Agreement
Secured Party agrees (i) to act as the Trustee's representative for such limited
purpose of perfecting the Trustee's security interest by possession or control
through a representative and (ii) to forthwith notify the Trustee, in writing,
of its receipt, possession or control of such Noteholder Collateral and deliver
possessions or relinquish control thereof to, or in favor of, the Trustee.

                  Section 4.3 Control of Dispositions of Credit Agreement
Collateral and Effect Thereof on Junior Liens.

                           (a) Each Party hereby agrees that any collection,
sale, or other disposition of Credit Agreement Collateral (whether under the
applicable Uniform Commercial Code or otherwise) by the Credit Facility Secured
Party or any sale or other disposition of Credit Agreement Collateral at the
request of a Credit Party 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 Credit Agreement
Collateral that was collected, sold or otherwise disposed of) on the proceeds of
such collection, sale, or other disposition (except to the extent such proceeds
are applied to the Credit Facility Indebtedness in accordance with Section 3.4
or otherwise in accordance with the terms of the Credit Facility Loan Documents
and the Indenture Documents).

                           (b) To the extent reasonably requested by the Credit
Facility Secured Party, the Trustee will cooperate in providing any necessary or
appropriate releases to permit a collection, sale, or other disposition of
Credit Agreement Collateral, as provided in Section 4.3(a), by the Credit
Facility Secured Party therein free and clear of the Trustee's Lien.

                  Section 4.4 Insurance and Condemnation. Until the earlier to
occur of (i) the date on which all Credit Facility Indebtedness is Fully Paid
and (ii) the first date following the Trigger Date on which the Maximum Amount
of Credit Facility Indebtedness is Fully Paid, (a) the Trustee agrees that the
Credit Facility Secured Party shall have the sole and exclusive right to adjust
settlement with respect to any insurance coverage for any Credit Agreement
Collateral and to exercise the rights provided in any security instrument to
waive or amend insurance requirements or to give consent relating to the
application of any proceeds of insurance, including, without limitation,
consents relating to restoration of Credit Agreement Collateral following a
casualty and (b) all proceeds of insurance and proceeds of any condemnation or
similar proceeding payable in respect of all or any part of the Credit Agreement
Collateral shall be paid to the Credit Facility Secured Party for application
pursuant to the Credit Facility Loan Documents. If the Credit Facility Secured
Party allows any portion of any proceeds of any insurance,

                                      -12-

<PAGE>

condemnation or similar award with respect to any Credit Agreement Collateral to
be used by a Credit Party to repair or replace the Credit Agreement Collateral
affected, the Trustee agrees to take promptly all action reasonably requested by
the Credit Facility Secured Party to permit such use.

                                  ARTICLE V.

                                 MISCELLANEOUS

                  Section 5.1 Rights of Subrogation. The Trustee agrees that no
payment or distribution to the Credit Facility Secured Party pursuant to the
provisions of this Agreement shall entitle the Trustee to exercise any rights of
subrogation in respect thereof until the earlier of the date on which (a) all
Credit Facility Indebtedness is Fully Paid and (b) the Maximum Amount of Credit
Facility Indebtedness 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 reasonable action
(including the recordation of a subordination agreement in the appropriate
recorder's office), that may be necessary or desirable, or that either Party may
reasonably request, in order to protect any right or interest granted or
purported to be granted hereby or to enable such 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.

                  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 Section 5.3(a) shall not apply to, and the
Trustee's Liens on the Credit Agreement Collateral shall not be subordinated in
priority by virtue of this Agreement to, the Credit Facility Secured Party's
Liens thereon if and to the extent that the Credit Facility Indebtedness is
increased, without the express written consent of the Trustee, to an amount in
excess of the Maximum Amount;

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

                                      -13-

<PAGE>

                           (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 Amendments, Etc. No amendment or waiver of any
provision of this Agreement and no consent to any departure by any Party shall
be effective unless the same is 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.

                  Section 5.5 Addresses for Notices. All demands, notices and
other communications provided for hereunder shall be in writing, and if to the
Trustee, mailed, sent by facsimile or delivered to it at the following address:

                           Wells Fargo Bank Minnesota, National Association
                           213 Court Street - Suite 902
                           Middletown, CT  06457
                           Telephone: (860) 704-6216
                           Facsimile: (860) 704-6219
                           Attention: Corporate Trust Services

and if to the Credit Facility Secured Party, mailed, sent by facsimile or
delivered to it at the following address:

                           Foothill Capital Corporation
                           2450 Colorado Avenue
                           Suite 3000 West
                           Santa Monica, CA  90404
                           Facsimile: (310) 453-7442
                           Attention: Structured Finance Group

with copies to the Issuers and the Credit Parties, if applicable, mailed, sent
by facsimile or delivered to them at the following address:

                           c/o Jacobs Entertainment, Inc. (f/k/a Gameco, Inc.)
                           240 Main Street
                           Black Hawk, CO  80422
                           Facsimile: (216) 861-6315
                           Attention: President

or as to any Party at such other address designated by such Party in a written
notice to the other Party complying as to delivery with the terms of this
Section 5.5. All such demands, notices and other communications shall be
effective: (a) if mailed, two business days after deposit in the mails, postage
prepaid; (b) if sent by facsimile, when receipt is acknowledged by the receiving
facsimile equipment (or at the opening of the next business day if receipt is
after normal business hours); or (c) if by other means, when delivered.

                                      -14-

<PAGE>

                  Section 5.6 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 5.7 Termination of Agreement. This Agreement shall (a)
be binding upon the Parties and their successors and assigns (including, without
limitation, all parties that become lenders or participants under the Credit
Facility); (b) inure to the benefit of and be enforceable by the Parties and
their respective successors, transferees and assigns; and (c) terminate upon the
Credit Facility Indebtedness or the Subordinated Lien Indebtedness being Fully
Paid; provided that the obligations of the Parties under Sections 4.1, 4.2 and
5.2 shall survive this Agreement.

                  Section 5.8 Governing Law; Entire Agreement. This Agreement
shall be governed by, and construed in accordance with, the laws of the State of
New York applicable to contracts made and to be performed in New York, including
Sections 5-1401 and 5-1402 of the New York General Obligations Law. This
Agreement 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 5.9 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 5.10 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 Credit Facility Secured Party
and the Holders). No other Person (including either Issuer, any Subsidiary
Guarantor or, any subsidiary or affiliate of the Issuers) shall be deemed to be
a third party, beneficiary of this Agreement or shall have any rights to enforce
any provisions hereof.

                  Section 5.11 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 5.12 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 5.13 Trustee Status. Notwithstanding any term herein
to the contrary, it is hereby expressly agreed and acknowledged that the
subordination and related agreements set forth herein by the Trustee are made
solely in its capacity as

                                      -15-

<PAGE>

trustee and secured party under the Indenture Documents and with respect to the
Notes (and not in its individual commercial capacity, except to the extent that
it is or becomes a Holder). Neither the Trustee nor the Credit Facility Secured
Party shall have any duties, obligations or responsibilities to the other Party
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
their acknowledgment hereof, the Issuers expressly agree that as between them
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, each of the Trustee and the Credit Facility Secured Party may (a)
rely in good faith, as to matters of fact, on any representation of fact
believed by Trustee or the Credit Facility Secured Party, as applicable, to be
true (without any duty of investigation) and that is contained in a written
certificate of any authorized representative of the Trustee, of the Issuers or
of the Credit Facility Secured Party, as applicable; (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 counsel to the Credit Facility Secured
Party or the Trustee, as applicable, 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 5.14 Gaming Laws.

                           (a) The Trustee and the Credit Facility Secured Party
acknowledge, understand and agree that the Gaming Laws may impose certain
licensing or transaction approval requirements prior to the exercise of the
rights and remedies granted to them under this Agreement with respect to the
Credit Agreement Collateral subject to the Gaming Laws.

                           (b) If any consent under the Gaming Laws is required
in connection with the taking of any of the actions which may be taken by either
the Trustee, or the Credit Facility Secured Party in the exercise of their
rights hereunder, then each agrees to use its best efforts to secure such
consent and to cooperate with the other party in obtaining any such consent.
Upon the occurrence and during the continuation of any Event of Default, each
party shall promptly execute and/or cause the execution of all applications,
certificates, instruments, and other documents and papers that the Trustee or
the Credit Facility Secured Party may be required to file in order to obtain any
necessary approvals under the Gaming Laws.

                  Section 5.15 Representations and Warranties.

                           (a) The Credit Facility Secured Party hereby
represents and warrants that this Agreement has been duly authorized, executed
and delivered on its

                                      -16-

<PAGE>

behalf and constitutes the legal, valid and binding obligation of the Credit
Facility Secured Party enforceable in accordance with its terms.

                           (b) The Trustee hereby represents and warrants that
this Agreement has been duly authorized, executed and delivered on its behalf
and constitutes the legal, valid and binding obligation of it enforceable in
accordance with its terms.

                                      -17-

<PAGE>

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

                                                  CREDIT FACILITY SECURED PARTY:

                                                  FOOTHILL CAPITAL CORPORATION

                                                  By: /s/ Stephen Schwartz
                                                     ---------------------------
                                                     Name: Stephen Schwartz
                                                     Title: S.V.P.

                                                  TRUSTEE:

                                                  WELLS FARGO BANK MINNESOTA,
                                                    NATIONAL ASSOCIATION

                                                  By: /s/ Robert L. Reynolds
                                                     ---------------------------
                                                  Name: Robert L. Reynolds
                                                  Title: Vice President

                                      -18-

<PAGE>

                                 ACKNOWLEDGMENT

                  Each of the undersigned hereby acknowledges that (a) it has
received a copy of the foregoing Intercreditor Agreement and consents thereto,
and agrees to recognize all rights granted hereby to the parties thereto, and
will not do any act or perform any obligation which 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 as of July 12, 2002.

                           JACOBS ENTERTAINMENT, INC.,
                           a Delaware corporation

                           By: /s/ Stephen R. Roark
                              ------------------------
                                Stephen R. Roark
                                Chief Financial Officer and President of Casino
                                Operations

                           BLACK HAWK GAMING & DEVELOPMENT COMPANY, INC.
                           a Colorado corporation.

                           By: /s/ Stephen R. Roark
                              ------------------------
                                  Stephen R. Roark,
                                  President

                           GILPIN VENTURES, INC.
                           a Colorado corporation

                           By: /s/ Stephen R. Roark
                              -----------------------
                                  Stephen R. Roark,
                                  President

<PAGE>

                           GILPIN HOTEL VENTURE
                           a Colorado partnership

                           By:  BLACK HAWK GAMING &
                                DEVELOPMENT COMPANY, INC,
                                a Colorado corporation,
                                Its Joint Venture Partner

                                By: /s/ Stephen R. Roark
                                   ----------------------------
                                        Stephen R. Roark,
                                        President

                           By:  GILPIN VENTURES, INC.,
                                a Colorado corporation,
                                Its Joint Venture Partner

                                By: /s/ Stephen R. Roark
                                   ----------------------------
                                        Stephen R. Roark,
                                        President

                           BLACK HAWK/JACOBS ENTERTAINMENT LLC
                           a Colorado limited liability company

                           By:  BLACK HAWK GAMING & DEVELOPMENT
                                COMPANY, INC.,
                                a Colorado corporation,
                                Its Manager

                                By: /s/ Stephen R. Roark
                                   ----------------------------
                                        Stephen R. Roark,
                                        President

                           DIVERSIFIED OPPORTUNITIES LTD.
                           an Ohio Limited Liability Company

                           By:  JACOBS ENTERTAINMENT, INC.,
                                a Delaware corporation,
                                Its Manager

                                By: /s/ Stephen R. Roark
                                   ----------------------------
                                        Stephen R. Roark,
                                        Chief Financial Officer

                                       -2-

<PAGE>

                           GOLD DUST WEST CASINO, INC.
                           a Nevada corporation

                           By: /s/ Stephen R. Roark
                              ----------------------------------
                           Name: Stephen R. Roark
                           Title: Vice President

                           JALOU L.L.C.
                           a Louisiana limited liability company

                           By: /s/ Ian M. Stewart
                              ----------------------------------
                              Ian M. Stewart
                              President

                           HOUMA TRUCK PLAZA & CASINO, L.L.C.
                           a Louisiana limited liability company

                           By: /s/ Ian M. Stewart
                              ----------------------------------
                              Ian M. Stewart
                              President

                           BAYOU VISTA TRUCK PLAZA AND CASINO, L.L.C.
                           a Louisiana limited liability company

                           By: /s/ Ian M. Stewart
                              ----------------------------------
                              Ian M. Stewart
                              President

                           LUCKY MAGNOLIA TRUCK STOP AND CASINO, L.L.C.
                           a Louisiana limited liability company

                           By: /s/ Ian M. Stewart
                              ----------------------------------
                              Ian M. Stewart
                              President

                           JALOU-CASH's L.L.C.
                           a Louisiana limited liability company

                           By: /s/ Ian M. Stewart
                              ----------------------------------
                              Ian M. Stewart
                              President

                              -3-

<PAGE>

                           RACELAND TRUCK PLAZA AND CASINO, L.L.C.
                           a Louisiana limited liability company

                           By: /s/ Ian M. Stewart
                              ----------------------------------
                              Ian M. Stewart
                              President

                           JALOU II INC.
                           a Louisiana corporation

                           By: /s/ Ian M. Stewart
                              ----------------------------------
                              Ian M. Stewart
                              President

                           WINNER'S CHOICE CASINO,INC.
                           a Louisiana corporation

                           By: /s/ Ian M. Stewart
                              ----------------------------------
                              Ian M. Stewart
                              President

                           JACE, INC.
                           a Louisiana corporation

                           By: /s/ Ian M. Stewart
                              ----------------------------------
                              Ian M. Stewart
                              President

                           COLONIAL HOLDINGS,INC.
                           a Louisiana corporation

                           By: /s/ Ian M. Stewart
                              ----------------------------------
                              Ian M. Stewart
                              President

                           COLONIAL DOWNS, L.P.
                           a Virginia limited partnership

                           By:  STANSLEY RACING CORP.,
                                a Virginia corporation,
                                Its general partner

                                By: /s/ Ian M. Stewart
                                   -----------------------------
                                        Ian M. Stewart
                                        President

                                       -4-

<PAGE>

                           STANSLEY RACING CORP.
                           a Virginia corporation

                           By: /s/ Ian M. Stewart
                              -----------------------------
                              Ian M. Stewart
                              President

                                       -5-

<PAGE>

                                   SCHEDULE I

                          CREDIT AGREEMENT COLLATERAL

                  Section 1. "Collateral" or "Credit Agreement Collateral" means
all of the Black Hawk/Gilpin Entities' (as hereafter defined) right, title and
interest in, to and under the following property, whether now existing or
hereafter arising or acquired from time to time (collectively, the "Collateral";
the following capitalized terms have the meaning set forth in Section 2 of this
Schedule 1.2):

                          1. Owned Premises;

                          2. Leased Premises;

                          3. Leases;

                          4. Rents and other income, issues and profits derived
                             from items 1-3, inclusive, above;

                          5. Equipment; and

                          6. Proceeds.

                  Section 2. Definitions. As used in this Schedule 1-2, the
following terms shall have the following meanings. All capitalized terms used
but not otherwise defined herein have the meanings given to them in the Credit
Agreement (as defined below). Such definitions shall be equally applicable to
the singular and plural forms of the terms defined.

                  "Alteration" shall mean any and all alterations,
installations, improvements, additions, modifications or changes of a structural
nature of or to the Leased Premises or Owned Premises.

                  "Black Hawk" shall mean Black Hawk Gaming & Development, Inc.,
a Colorado corporation.

                  "Black Hawk/Gilpin Entities" shall mean, collectively, Black
Hawk, Black Hawk/Jacobs and Gilpin.

                  "Black Hawk/Jacobs" shall mean Black Hawk/Jacobs
Entertainment, LLC, a Colorado limited liability company.

                  "Credit Agreement" shall mean that certain Loan and Security
Agreement between and among Lender and Jacobs Entertainment, Inc., a Delaware
corporation, and the Black Hawk/Gilpin Entities, as Borrowers.

<PAGE>

                   "Equipment" shall mean all "equipment", as such term is
defined in the UCC, now owned or hereafter acquired by any Black Hawk/Gilpin
Entity, wherever located and, in any event, including all such Black Hawk/Gilpin
Entity's machinery and equipment, including processing equipment, conveyors,
machine tools, data processing and computer equipment, including embedded
software and peripheral equipment and all engineering, processing and
manufacturing equipment, gaming machines and devices, office machinery,
furniture, materials handling equipment, tools, attachments, accessories,
automotive equipment, trailers, trucks, forklifts, molds, dies, stamps, motor
vehicles, rolling stock and other equipment of every kind and nature, trade
fixtures and fixtures not forming a part of real property, together with all
additions and accessions thereto, replacements therefor, all parts therefor, all
substitutes for any of the foregoing, fuel therefor, and all manuals, drawings,
instructions, warranties and rights with respect thereto, and all products and
proceeds thereof and condemnation awards and insurance proceeds with respect
thereto.

                  "Fixture" shall mean (1) all machinery, apparatus, equipment,
fittings, fixtures, improvements and articles of personal property of every
kind, description and nature whatsoever now or hereafter attached or affixed to
the Owned Land or any other Improvement or used in connection with the use and
enjoyment of the Owned Land or any other Improvement or the maintenance or
preservation thereof, which by the nature of their location thereon or
attachment thereto are fixtures under the UCC or any other applicable law
including, without limitation, all utility systems, fire sprinkler and security
systems, drainage facilities, lighting facilities, all water, sanitary and storm
sewer, drainage, electricity, steam, gas, telephone and other utility equipment
and facilities, pipes, fittings and other items of every kind and description
now or hereafter attached to or located on the Owned Land which by the nature of
their location thereon or attachment thereto are real property under applicable
law, HVAC equipment, boilers, electronic data processing, telecommunications or
computer equipment, gaming machines or devices, refrigeration, electronic
monitoring, water or lighting systems, power, sanitation, waste removal,
elevators, maintenance or other systems or equipment and all additions thereto
and betterments, renewals, substitutions and replacements thereof and (2) all of
the Black Hawk/Gilpin Entities' estate, right, title and interest in, to and
under all machinery, apparatus, equipment, fittings, fixtures, improvements and
articles of personal property of every kind, description and nature whatsoever
now or hereafter attached or affixed to the Leased Land or any other Improvement
or used in connection with the use and enjoyment of the Leased Land or any other
Improvement or the maintenance or preservation thereof, which by the nature of
their location thereon or attachment thereto are fixtures under the UCC or any
other applicable law including, without limitation, all utility systems, fire
sprinkler and security systems, drainage facilities, lighting facilities, all
water, sanitary and storm sewer, drainage, electricity, steam, gas, telephone
and other utility equipment and facilities, pipes, fittings and other items of
every kind and description now or hereafter attached to or located on the Leased
Land which by the nature of their location thereon or attachment thereto are
real property under applicable law, HVAC equipment, boilers, electronic data
processing, telecommunications or computer equipment, gaming machines or
devices, refrigeration, electronic monitoring, water or lighting systems, power,
sanitation, waste removal, elevators, maintenance or other systems or equipment
and all additions thereto and betterments, renewals, substitutions and
replacements

                                       -2-

<PAGE>

thereof to the extent of the Black Hawk/Gilpin Entities' estate, right, title
and interest therein.

                  "Gilpin" shall mean Gilpin Hotel Venture, a Colorado joint
venture.

                  "Governmental Authority" shall mean any federal, state, local,
foreign or other governmental, quasi-governmental or administrative (including
self-regulatory) body, instrumentality, department, agency, authority, board,
bureau, commission, office of any nature whatsoever or other subdivision
thereof, or any court, tribunal, administrative hearing body, arbitration panel
or other similar dispute-resolving body, whether now or hereafter in existence,
or any officer or official thereof, having jurisdiction over the Black
Hawk/Gilpin Entities or the Credit Agreement Collateral or any portion thereof.

                  "Improvements" shall mean (1) all buildings, structures and
other improvements of every kind or description and any and all Alterations now
or hereafter located, attached or erected on the Owned Land including, without
limitation, (i) all Fixtures of the type described in clause (1) of the
definition thereof, (ii) all attachments, railroad tracks, foundations,
sidewalks, drives, roads, curbs, streets, ways, alleys, passages, passageways,
sewer rights, parking areas, driveways, fences and walls and (iii) all materials
now or hereafter located on the Owned Land intended for the construction,
reconstruction, repair, replacement, alteration, addition or improvement of or
to such buildings, Fixtures, structures and improvements, all of which materials
shall be deemed to be part of the Improvements immediately upon delivery thereof
on the Owned Land and to be part of the improvements immediately upon their
incorporation therein; and (2) all of the Black Hawk/Gilpin Entities' estate,
right, title and interest in, to and under all buildings, structures and other
improvements of every kind or description and any and all Alterations now or
hereafter located, attached or erected on the Leased Land including, without
limitation, (i) all Fixtures of the type described in clause (2) of the
definition thereof, (ii) all attachments, railroad tracks, foundations,
sidewalks, drives, roads, curbs, streets, ways, alleys, passages, passageways,
sewer rights, parking areas, driveways, fences and walls and (iii) all materials
now or hereafter located on the Leased Land intended for the construction,
reconstruction, repair, replacement, alteration, addition or improvement of or
to such buildings, Fixtures, structures and improvements, all of which materials
shall be deemed to be part of the Improvements immediately upon delivery thereof
on the Leased Land and to be part of the improvements immediately upon their
incorporation therein.

                  "Landlord" shall mean any landlord, sublandlord, lessor,
sublessor franchisor, licensor or grantor, as applicable.

                  "Leased Land" shall mean, in the case of Gilpin, the land
described in Schedule A annexed hereto as Parcels 1, 2, 3, 4, 5 and 7 and any
and all easements, rights-of-way, strips and gores of land, waters, water
courses, water rights, mineral, gas and oil rights and all power, air, light and
other rights, estates, titles, interests, privileges, liberties, servitudes,
licenses, tenements, hereditaments and appurtenances whatsoever, in any way
demised under the Mortgaged Leases or belonging, relating or appertaining

                                       -3-

<PAGE>

thereto, or any part thereof, or which hereafter shall in any way be demised
under the Mortgaged Leases or belong, relate or be appurtenant thereto.

                  "Leased Premises" shall mean, collectively, (1) the lessee's
interest and estate in the Mortgaged Leases and all recorded or unrecorded
extensions, amendments, supplements and restatements thereof, and (2) all right,
title and interest of the lessee under the Mortgaged Leases in and to (i) the
Leased Land and (ii) Improvements of the type described in clause (2) of the
definition thereof.

                  "Leases" shall mean, collectively, any and all interests of
the Black Hawk/Gilpin Entities, as Landlord, in all leases and subleases of
space, tenancies, franchise agreements, licenses, occupancy, rental, access or
concession agreements and any other agreements pursuant to which any Person is
granted a possessory interest in or right to use or occupy all or any portion of
the Credit Agreement Collateral, in each case whether now existing or hereafter
entered, into, whether or not of record, relating in any manner to the Owned
Premises or the Leased Premises or the use or occupancy thereof and any and all
amendments, modifications, supplements, replacements, extensions, renewals
and/or guarantees, if any thereof, whether now in effect or hereafter coming
into effect.

                  "Mortgaged Leases" shall mean the leases described on Schedule
B attached hereto.

                  "Net Loss Proceeds" shall have the meaning assigned to such
term in the Indenture as in effect on the date hereof.

                  "Owned Premises" shall mean, collectively, (i) the Owned Land
and (ii) Improvements of the type described in clause (1) of the definition
thereof described.

                  "Owned Land" shall mean (i) in the case of Black Hawk, the
land described in Schedule A annexed hereto as Parcels 1, 2, 3, 4 and 5 and (ii)
in the case of Black Hawk/Jacobs, the land described in Schedule A annexed
hereto as Parcel 6, in each case together with Black Hawk's or Black
Hawk/Jacobs's, as the case may be, reversionary rights therein and all of the
Black Hawk/Gilpin Entities' rights in and to any and all easements,
rights-of-way, strips and gores of land, waters, water courses, water rights,
mineral, gas and oil rights and all power, air, light and other rights, estates,
titles, interests, privileges, liberties, servitudes licenses, covenants,
conditions, restrictions, tenements, hereditaments and appurtenances whatsoever,
in any way belonging, relating or appertaining thereto, or any part thereof, or
which hereafter shall in any way belong, relate or be appurtenant thereto.

                  "Person" shall have the meaning assigned to such term in the
Indenture as in effect on the date hereof.

                  "Premises" shall mean, collectively, the Owned Premises and
the Leased Premises.

                                       -4-

<PAGE>

                  "Proceeds" shall mean, collectively, any and all cash proceeds
and noncash proceeds and shall include, without limitation, all (i) proceeds of
the conversion, voluntary or involuntary, of any of the Credit Agreement
Collateral or any portion thereof into cash or liquidated claims, (ii) proceeds
of any insurance (except payments made to a Person, other than the Black
Hawk/Gilpin Entities or any Subsidiary thereof, that is not a party to the
Financing Documents), indemnity, warranty, guaranty or claim payable to the
Lender, the Indenture Trustee or to the Black Hawk/Gilpin Entities from time to
time with respect to any of the Credit Agreement Collateral including, without
limitation, all Net Loss Proceeds relating thereto, (iii) payments (in any form
whatsoever) made or due and payable to the Black Hawk/Gilpin Entities from time
to time in connection with any requisition, confiscation, condemnation, seizure
or forfeiture of all or any portion of the Credit Agreement Collateral by any
Governmental Authority (or any Person acting on behalf of a Governmental
Authority) including, without limitation, all Net Loss Proceeds relating
thereto, (iv) products of the Credit Agreement Collateral and (v) other amounts
from time to time paid or payable under or in connection with any of the Credit
Agreement Collateral.

                  "Rents" shall mean, collectively, any and all rents,
additional rents, royalties, issues, cash, guaranties, letters of credit, bonds,
sureties or securities deposited under any Lease to secure performance of the
Tenant's obligations thereunder, revenues, earnings, profits and income, advance
rental payments, payments incident to assignment, sublease or surrender of a
Lease, claims for forfeited deposits and claims for damages, now due or
hereafter to become due, with respect to any Lease, any indemnification against,
or reimbursement for, sums paid and costs and expenses incurred by the Black
Hawk/Gilpin Entities under any Lease or otherwise, and any award in the event of
the bankruptcy of any Tenant under or guarantor of a lease.

                  "Tenant" shall mean any tenant, lessee, sublessee, franchisee,
licensee, grantee or obligee, as applicable.

                  "UCC" means, generally, the Uniform Commercial Code as the
same may, from time to time, be enacted and in effect in the State of New York;
provided, however, that solely for the purposes of the provisions hereof
relating to the attachment, perfection or priority of Lender's security interest
in any Collateral and for purposes of definitions relating to such provisions,
(a) subject to clause (b) below, the term "UCC" shall mean the Uniform
Commercial Code as enacted and in effect in the State of Colorado and (b) in the
event that, by reason of mandatory provisions of law, any or all of the
attachment, perfection or priority of Lender's security interest in any
Collateral is governed by the Uniform Commercial Code as enacted and in effect
in any other jurisdiction, the term "UCC" shall mean the Uniform Commercial Code
as enacted and in effect in such other jurisdiction.

                                       -5-

<PAGE>

                      Schedule A to Collateral Description

                 Legal Description of Real Property (by Parcel)

PARCEL 1:

LOTS 2, 3, 4 AND THE WESTERLY 30 FEET OF LOT 5, BLOCK 37,

CITY OF BLACK HAWK,

TOGETHER WITH THAT PORTION OF MAIN STREET ADJOINING SAID LOTS CONVEYED TO GILPIN
GOLD, INC., A COLORADO CORPORATION AND BLACK HAWK GAMING & DEVELOPMENT COMPANY,
INC. FKA MOUNTAIN CASINO PROPERTIES BY PROPERTY LINE AGREEMENT RECORDED FEBRUARY
26, 1996, IN BOOK 595 AT PAGE 145,

TOGETHER WITH THAT PORTION OF MAIN STREET ADJOINING SAID LOTS CONVEYED TO BLACK
HAWK GAMING & DEVELOPMENT COMPANY, INC. FKA MOUNTAIN CASINO PROPERTIES BY
PROPERTY LINE AGREEMENT RECORDED FEBRUARY 26, 1996, IN BOOK 595 AT PAGE 183,

EXCEPT ANY PORTION CONVEYED TO CITY OF BLACK HAWK IN PROPERTY LINE AGREEMENT,
RECORDED FEBRUARY 26, 1996, IN BOOK 595 AT PAGE 145,

AND EXCEPT ANY PORTION CONVEYED TO CITY OF BLACK HAWK BY QUIT CLAIM DEED
RECORDED APRIL 10, 1996, IN BOOK 597 AT PAGE 138, COUNTY OF GILPIN, STATE OF
COLORADO.

PARCEL 2:

A PARCEL OF GROUND IN THE CITY OF BLACK HAWK, DESCRIBED AS FOLLOWS:

BEGINNING AT A POINT WHICH LIES N. 48(degree)06' W., 10 FEET FROM THE SOUTHEAST
CORNER OF LOT 6, BLOCK 40, CITY OF BLACK HAWK; THENCE N. 43(degree)33' E.,
100.05 FEET; THENCE S. 48(degree)06' E., 10 FEET; THENCE N. 43(degree)33' E.,
48.12 FEET; THENCE S. 51(degree)34' E., 93.30 FEET; THENCE S. 38(degree)29'
W., 152.36 FEET; THENCE N. 57(degree)59' W., 10 FEET; THENCE N. 48(degree)06'
W., 106.66 FEET TO THE PLACE OF BEGINNING, SOMETIMES DESCRIBED AS THE EAST 10
FEET OF LOT 6, BLOCK 40, PART OF MILL SITE NO. 29 AND THE WEST 10 FEET OF MILL
SITE NO. 30 AND TRACT,

TOGETHER WITH THAT PORTION OF MAIN STREET ADJOINING SAID PARCEL CONVEYED TO
GILPIN GOLD, INC., A COLORADO CORPORATION AND BLACK HAWK GAMING & DEVELOPMENT
COMPANY, INC. FKA

                                       -6-

<PAGE>

MOUNTAIN CASINO PROPERTIES BY PROPERTY LINE AGREEMENT RECORDED FEBRUARY 26,
1996, IN BOOK 595 AT PAGE 145,

TOGETHER WITH THAT PORTION OF MAIN STREET ADJOINING SAID PARCEL CONVEYED TO
BLACK HAWK GAMING & DEVELOPMENT COMPANY, INC. FKA MOUNTAIN CASINO PROPERTIES BY
PROPERTY LINE AGREEMENT RECORDED FEBRUARY 26, 1996, IN BOOK 595 AT PAGE 183,

EXCEPTING THEREFROM THOSE PORTIONS OF MILL SITE 29 GRANTED TO THE COUNTY OF
GILPIN BY INSTRUMENTS RECORDED NOVEMBER 6, 1939, IN BOOK 214 AT PAGE 69, AND
APRIL 8, 1940, IN BOOK 214 AT PAGE 225,

AND EXCEPT ANY PORTION CONVEYED TO CITY OF BLACK HAWK IN PROPERTY LINE
AGREEMENT, RECORDED FEBRUARY 26, 1996, IN BOOK 595 AT PAGE 145,

AND EXCEPT ANY PORTION CONVEYED TO CITY OF BLACK HAWK IN PROPERTY LINE AGREEMENT
RECORDED FEBRUARY 26, 1996, IN BOOK 595 AT PAGE 183,

AND EXCEPT ANY PORTION CONVEYED TO CITY OF BLACK HAWK BY QUIT CLAIM DEED
RECORDED APRIL 10, 1996, IN BOOK 597 AT PAGE 138,

AND EXCEPT ANY PORTION CONVEYED TO CITY OF BLACK HAWK BY QUIT CLAIM DEED
RECORDED APRIL 10, 1996, IN BOOK 597 AT PAGE 160,

AND EXCEPT ANY PORTION CONVEYED TO BLACK HAWK/JACOBS ENTERTAINMENT, LLC BY QUIT
CLAIM DEED RECORDED MARCH 24, 1997, IN BOOK 617 AT PAGE 192,

AND EXCEPT ANY PORTION CONVEYED TO THE COLORADO CENTRAL RAILROAD COMPANY BY DEED
RECORDED IN BOOK 72 AT PAGE 363,

AND EXCEPT THOSE PORTIONS OF MILL SITE 29 GRANTED TO THE COUNTY OF GILPIN BY
INSTRUMENTS RECORDED NOVEMBER 6, 1939, IN BOOK 214 AT PAGE 69 AND APRIL 8, 1940,
IN BOOK 214 AT PAGE 225,

COUNTY OF GILPIN, STATE OF COLORADO.

PARCEL 3:

THE EAST 15 FEET OF LOT 11,

ALL OF LOT 12, BLOCK 35, AND

ALL OF LOT 1, BLOCK 37,

CITY OF BLACK HAWK,

                                       -7-

<PAGE>

TOGETHER WITH AND SUBJECT TO PERPETUAL EASEMENT RECORDED APRIL 15, 1997, IN BOOK
618 AT PAGE 295, AND

TOGETHER WITH AND SUBJECT TO ANY PORTION CONVEYED TO BLACK HAWK GAMING &,
DEVELOPMENT COMPANY, INC., A COLORADO CORPORATION AND GILPIN HOTEL VENTURE, A
COLORADO JOINT VENTURE BY EASEMENT, BOUNDARY AND REAL ESTATE CONVEYANCE
AGREEMENT RECORDED MARCH 8, 1994, IN BOOK 560 AT PAGE 428.

EXCEPT ANY PORTION CONTAINED IN DEED RECORDED MARCH 8, 1994, IN BOOK 560 AT PAGE
424,

AND EXCEPT ANY PORTION CONVEYED TO CITY OF BLACK HAWK IN PROPERTY LINE
AGREEMENT, RECORDED FEBRUARY 26, 1996, IN BOOK 595 AT PAGE 145,

AND EXCEPT ANY PORTION CONVEYED TO 101 MAIN STREET LIMITED LIABILITY COMPANY BY
AGREEMENT RECORDED MARCH 8, 1994, IN BOOK 560 AT PAGE 428.

AND EXCEPT ANY PORTION CONVEYED TO CITY OF BLACK HAWK BY QUIT CLAIM DEED
RECORDED APRIL 10, 1996, IN BOOK 597 AT PAGE 138,

COUNTY OF GILPIN, STATE OF COLORADO.

PARCEL 4:

THAT PORTION OF THE NINETY NINE (99) LODE A MINING CLAIM, SAID 99 LODE AS
DESCRIBED IN QUIT CLAIM DEED RECORDED DECEMBER 13, 1899, IN BOOK 150 AT PAGE
317, THAT LIES WITHIN THE BOUNDARIES OF PARCELS 1, 2, 3 AND 5, SHOWN HEREIN,

CITY OF BLACK HAWK,

COUNTY OF GILPIN, STATE OF COLORADO.

PARCEL 5:

THAT PART OF MILL SITE #30, CITY OF BLACK HAWK, DESCRIBED AS FOLLOWS:

COMMENCING AT THE SOUTHEASTERLY CORNER OF MILL SITE 30 AT THE BEND POINT ON
MAIN STREET; THENCE N. 35 (degree) 41' E., 12.0 FEET BETWEEN MILL SITES 30 AND
31, TO THE POINT OF BEGINNING; THENCE N. 35 (degree) 41' E., 103.61 FEET BETWEEN
MILL SITES 30 AND 31 TO THE SOUTHWESTERLY RIGHT OF WAY LINE OF HIGHWAY #119;
THENCE N. 51 (degree) 34' W., 486.91 FEET ALONG THE HIGHWAY RIGHT OF WAY; THENCE
S. 38 (degree) 29' W., 152.36 FEET MORE OR LESS FROM A BEND POINT; THENCE S. 57
(degree) 59' E., 264.08 FEET

                                       -8-

<PAGE>

ALONG MAIN STREET; THENCE S. 56 (degree) 24' E., 230.29 FEET, MORE OR LESS, TO
THE POINT OF BEGINNING;

EXCEPT ANY PORTION THEREOF LYING WITHIN TRACT DESCRIBED IN BOOK 170 AT PAGE 225,
SOMETIMES REFERRED TO AS THE WEST 10 FEET OF MILL SITE #30;

AND EXCEPT ANY PORTION THEREOF LYING WITHIN TRACT DESCRIBED IN BOOK 195 AT PAGE
527;

AND EXCEPT ANY PORTION CONVEYED TO CITY OF BLACK HAWK IN PROPERTY LINE
AGREEMENT, RECORDED FEBRUARY 26, 1996, IN BOOK 595 AT PAGE 145,

AND EXCEPT ANY PORTION CONVEYED TO CITY OF BLACK HAWK IN PROPERTY LINE AGREEMENT
RECORDED FEBRUARY 26, 1996, IN BOOK 595 AT PAGE 183,

AND EXCEPT ANY PORTION CONVEYED TO CITY OF BLACK HAWK BY QUIT CLAIM DEED
RECORDED APRIL 10, 1996, IN BOOK 597 AT PAGE 138,

AND EXCEPT ANY PORTION CONVEYED TO CITY OF BLACK HAWK BY QUIT CLAIM DEED
RECORDED APRIL 10, 1996, IN BOOK 597 AT PAGE 160,

AND EXCEPT ANY PORTION CONVEYED TO BLACK HAWK/JACOBS ENTERTAINMENT, LLC BY QUIT
CLAIM DEED RECORDED MARCH 24, 1997, IN BOOK 617 AT PAGE 192,

AND EXCEPT ANY PORTION CONVEYED TO THE COLORADO CENTRAL RAILROAD COMPANY BY DEED
RECORDED IN BOOK 72 AT PAGE 363,

COUNTY OF GILPIN, STATE OF COLORADO.

PARCEL 6:

A TRACT OF LAND SITUATED IN MILL SITES 30, 31, 32 AND 34, IN THE CITY OF BLACK
HAWK. SITUATED IN THE SOUTH OF SECTION 7, TOWNSHIP 3 SOUTH, RANGE 72 WEST OF THE
6TH P.M., AND IN BLACK HAWK/JACOBS SUBDIVISION FILING NO. 1 MINOR SUBDIVISION
PLAT, RECORDED OCTOBER 9, 1998, IN BOOK 653 AT PAGE 44, AND THE 1ST AMENDMENT
RECORDED OCTOBER 9, 1998, IN BOOK 653 AT PAGE 45, AND THE SECOND AMENDMENT
RECORDED OCTOBER 9,1998, IN BOOK 653 AT PAGE 46,

GILPIN COUNTY, COLORADO, MORE PARTICULARLY DESCRIBED AS FOLLOWS:

COMMENCING AT A POINT WHICH BEARS S. 66 (degree) 30'08" E., A DISTANCE OF
2923.98 FEET FROM THE W 1/4 CORNER OF SAID SECTION 7, ALSO BEING

                                       -9-

<PAGE>

CORNER #21 OF THE SECURITY PLACER MINERAL SURVEY NO. 5864 AND SITUATED ON THE
NORTHEASTERLY RIGHT-OF-WAY OF MAIN STREET AS SHOWN ON A.D.G. ENGINEERING INC.
REALIGNMENT MAPS FOR THE CITY OF BLACK HAWK; THENCE ALONG THE SAID NORTHEASTERLY
RIGHT-OF-WAY THE FOLLOWING ELEVEN (11) COURSES:

N. 39 (degree) 01'53" W., A DISTANCE OF 241.62 FEET TO A POINT;
N. 35 (degree) 04'41" W., A DISTANCE OF 58.02 FEET TO A POINT;
N. 43 (degree) 11'28" W., A DISTANCE OF 55.15 FEET TO A POINT;
N. 48 (degree) 17'59" W., A DISTANCE OF 28.82 FEET TO A POINT;
N. 60 (degree) 47'16" W., A DISTANCE OF 211.15 FEET TO A POINT;
N. 35 (degree) 40'25" E., A DISTANCE OF 3.31 FEET TO A POINT;
N. 61 (degree) 49'18" W., A DISTANCE OF 53.33 FEET TO A POINT;
N. 57 (degree) 09'32" W., A DISTANCE OF 94.26 FEET TO A POINT;
N. 52 (degree) 54'00" W., A DISTANCE OF 78.00 FEET TO A POINT;
N. 57 (degree) 25'53" W., A DISTANCE OF 76.00 FEET TO A POINT;
N. 60 (degree) 09'14" W., A DISTANCE OF 73.21 FEET TO A POINT;
THENCE DEPARTING SAID RIGHT-OF-WAY N. 32 (degree) 45'26" E., A DISTANCE OF
117.52 FEET TO A POINT ON THE PROPOSED SOUTHWESTERLY RIGHT-OF-WAY OF COLORADO
HIGHWAY #119;THENCE ALONG SAID PROPOSED RIGHT-OF-WAY THE FOLLOWING FOUR (4)
COURSES;
S. 51 (degree) 35'41" E., A DISTANCE OF 834.94 FEET TO A POINT;
N. 50 (degree) 56'24" E., A DISTANCE OF 9.11 FEET TO A POINT;
S. 39 (degree) 03'36" E., A DISTANCE OF 40.98 FEET TO A POINT;
S. 51 (degree) 35'41" E., A DISTANCE OF 34.03 FEET TO A POINT;
THENCE ON A CURVE TO THE LEFT CONTAINING A CENTRAL ANGLE OF 6 (degree) 51'22",
A RADIUS OF 1403.00 FEET, AN ARC LENGTH OF 167.89 FEET, A CHORD BEARING OF S.
55 (degree) 01'22" E., A CHORD DISTANCE OF 167.79 FEET TO A POINT;
THENCE CONTINUING ALONG SAID RIGHT-OF-WAY S. 66 (degree) 16'40" E., A DISTANCE
OF 93.28 FEET TO A POINT;
THENCE S. 23 (degree) 43'20" W., A DISTANCE OF 9.66 FEET TO A POINT OF
CURVATURE; THENCE ON A NON TANGENT CURVE TO THE LEFT CONTAINING A CENTRAL ANGLE
OF 6 (degree) 28'03", A RADIUS OF 1403.00 FEET, AN ARC LENGTH OF 158.37 FEET, A
CHORD BEARING OF S. 65 (degree) 30'54" E., A CHORD DISTANCE OF 158.29 FEET TO A
POINT; THENCE DEPARTING SAID PROPOSED RIGHT-OF-WAY S. 22 (degree) 25'26" W., A
DISTANCE OF 4.35 FEET TO A POINT;
THENCE N. 69 (degree) 00'00" W., A DISTANCE OF 50.12 FEET TO A POINT;
THENCE N. 67 (degree) 30'00" W., A DISTANCE OF 30.14 FEET TO A POINT;
THENCE S. 18 (degree) 59'09" W., A DISTANCE OF 75.65 FEET TO A POINT ON THE
AFOREMENTIONED RIGHT-OF-WAY OF MAIN STREET;
THENCE ALONG SAID RIGHT-OF-WAY OF MAIN STREET THE FOLLOWING FOUR (4) COURSES: N.
71 (degree) 00'51" W., A DISTANCE OF 34.52 FEET TO A POINT;

                                      -10-

<PAGE>

N. 69 (degree) 35'02" W., A DISTANCE OF 52.24 FEET TO A POINT;
N. 71 (degree) 47'03" W., A DISTANCE OF 35.89 FEET TO A POINT;
N. 66 (degree) 13'42" W., A DISTANCE OF 197.56 FEET TO THE POINT OF BEGINNING,
COUNTY OF GILPIN, STATE OF COLORADO

PARCEL 7:

THE THIRD FLOOR OF A THREE LEVEL PARKING GARAGE LOCATED ON LOT 1A AS SHOWN ON
THAT CERTAIN BLACK HAWK/JACOBS SUBDIVISION, FILING NO. 1 2ND AMENDED, A MINOR
SUBDIVISION PLAT, RECORDED OCTOBER 9, 1998, IN BOOK 653 AT PAGE 46, IN THE
OFFICE OF THE CLERK AND RECORDER OF GILPIN COUNTY, COLORADO TOGETHER WITH RAMP
ACCESS SERVING ONLY SAID THIRD FLOOR,

COUNTY OF GILPIN, STATE OF COLORADO.

                                      -11-

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