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Note Participation Agreement

This is an actual contract by Nevada Gold & Casinos.

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Sectors: Leisure and Entertainment
Governing Law: Texas, View Texas State Laws
Effective Date: May 12, 1995
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THIS NOTE PARTICIPATION AGREEMENT (this "Agreement") is entered into effective as of May 12, 1995, between NEVADA GOLD & CASINOS, INC. ("Borrower"); RIVER OAKS TRUST COMPANY, a Texas trust company ("Trustee") and numerous parties participating in the Note described below, by execution of Addenda hereto in the form of the Addendum Agreement attached hereto as Exhibit "A" (the "Participants").

W I T N E S S E T H:

WHEREAS, Borrower and Trustee on behalf of the Participants, have entered into a Loan Agreement, dated effective as of the date hereof, pursuant to which the Participants, through the Trustee, will loan up to an aggregate principal amount of Three Hundred Fifty Thousand and No/100 Dollars ($350,000.00) to Borrower (the "Loans"), upon and subject to the terms and conditions stated in the Loan Agreement;

WHEREAS, the Loans are made pursuant to the Loan Agreement and the documents referred to in the Loan Agreement as the Loan Documents (collectively, the "Loan Documents");

WHEREAS, each Participant has agreed, subject to the terms and conditions hereinafter set forth, to acquire a participation in the Loans through the Trustee; and

WHEREAS, the parties wish to enter into this Agreement to describe their rights and obligations with respect to such participation arrangement.

NOW, THEREFORE, in consideration of the premises and for other valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties agree as follows:

1. Subject to the terms and conditions of this Agreement, each participant hereby acquires through the Trustee a participation in the Loans and any collateral now or at any time hereafter securing the Loans (the "Participation") equal to the dollar amount indicated in the Addendum to the Note Participation Agreement executed by the participant in the form of Exhibit "A" attached hereto (the "Participant's Addendum") and, with respect to the Collateral (as defined in the Loan Agreement) a percentage interest in the Collateral equal at any given time to the ratio (x) the Participant's principal plus interest accrued thereon from the date of the Participant's Addendum bears to (y) the total amount advanced to Borrower hereunder plus accrued interest. The Participation shall bear interest at the rates of interest borne by the Loans. The Participation shall be evidenced by this Agreement and the Addenda hereto which shall be part of this Agreement.

2. Upon receipt by Trustee of notice from the Borrower of a Request for Advance under any of the Loans in substantially the form of Exhibit "B" attached hereto, Trustee agrees that within twenty-four (24) hours after receipt of such notice, if such notice is given by 12:00 p.m., it will advance to Borrower by deposit into a designated account the amount of such advance that is available in Nevada Gold & Casinos, Inc., Escrow Account #7309-5085, Trust Account #5079 at River Oaks Trust Company assuming the conditions precedent set forth in this Agreement have been met. Each Participant's share of the Participation will be additionally evidenced by a Participation Certificate in the form of Exhibit "C" attached hereto.


3. Trustee shall remit to each Participant at his or her address as indicated on each Participant's Addendum in immediately available funds, each Participant's pro rata share of each payment received by Trustee with respect to the Loans and interest thereon (whether pursuant to the Loan Documents, or by voluntary payment, exercise of setoff, banker's lien, counterclaim, cross-action, realization on or with respect to collateral, or otherwise) on or before the business day following the date on which such payment is received by Trustee. Provided, however, that if Trustee is not obligated to, and does not forward such payment to each Participant until the business day following the date of receipt of such payment by Borrower, Trustee shall pay to each Participant, each Participant's pro rata share of the interest earned from the investment of such payment, if an
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