INTERNATIONAL THOROUGHBRED BREEDERS INC
EXHIBIT 10.8 MASTER LEAST AGREEMENT CH II
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>9
<FILENAME>exh8.txt
<DESCRIPTION>EXHIBIT 10.8 MASTER LEAST AGREEMENT CH II
<TEXT>
                                                                    Exhibit 10.8

                                                Transaction No. 1192-L01-01


                             MASTER LEASE AGREEMENT
                               (EMPRESS II VESSEL)


     THIS MASTER LEASE  AGREEMENT  ("Lease" or  "Agreement") is made and entered
into as of July 6, 2004, by and between CRUISE HOLDINGS II, LLC a Nevada limited
liability  company,   its  successors,   designated   subsidiaries  and  assigns
("Lessor") and PALM BEACH EMPRESS, INC., a Delaware corporation ("PBE") and PALM
BEACH  MARITIME  CORPORATION,   formerly  named  MJQ  CORPORATION,   a  Delaware
corporation  ("MJQ")  ,  jointly  and  severally  (PBE  and MJQ are  hereinafter
collectively referred to as, the "Lessee").

                                    RECITALS

     WHEREAS,  Lessor  desires to lease to Lessee,  and Lessee  desires to lease
from  Lessor  in  accordance  with the terms and  conditions  contained  herein,
certain  equipment  more fully  described  in the Lease  Schedule or  Schedules,
referred to herein as a "Lease Schedule" or "Lease Schedules",  as may from time
to time be executed by Lessee.

     NOW, THEREFORE, IN CONSIDERATION of the mutual covenants and conditions set
forth  below  and  other  good  and  valuable  consideration,  the  receipt  and
sufficiency of which all parties acknowledge, it is agreed as follows:

                                    AGREEMENT

   1.  Recitals   Incorporation.   The  recitals  set  forth  above  are  hereby
incorporated  into this  Agreement as material  parts  thereof and not simply as
mere recitals.

   2. Parties.

     2.1. The Lessor is CRUISE HOLDINGS II, a Nevada limited liability  company,
whose address is 6171 McLeod Drive, Las Vegas, NV 89120-4048.

     2.2. The Lessee consists of : (a) PALM BEACH MARITIME CORPORATION, formerly
named MJQ CORPORATION,  a Delaware  corporation,  whose address is One East 11th
Street,  Suite 500,  Riviera Beach, FL 33404.  MJQ's Tax ID Number is 23-2990156
and its Organizational ID Number is 2965747.  MJQ's location for the purposes of
all Uniform Commercial Code filings is the State of Delaware; and

               (b) PALM BEACH EMPRESS, INC., Delaware corporation, whose address
is One East 11th Street, Suite 500, Riviera Beach, FL 33404. PBE's Tax ID Number
is 43-2050598 and its  Organizational ID Number is 37777915.  PBE's location for
the purposes of all Uniform Commercial Code filings is the State of Delaware.

   3.  Lease and  Charter.  This Lease is based upon the  Bareboat  Charter  and
Option to Purchase  ("Charter")  of even date herewith,  incorporated  herein by
reference,  entered into between Lessor and Lessee,  allowing Lessee free use of
that certain Vessel,  defined below,  and further  establishes the general terms
and  conditions  by which  Lessor  shall  lease the Vessel and other  furniture,
fixtures  and  equipment  described  in the Lease  Schedule  (collectively,  the
"Equipment")  to Lessee.  Each Lease  Schedule  shall be in the form provided by
Lessor and shall incorporate by reference the terms of this Lease. The Equipment
is to be used in  connection  with that  business  described  as the Palm  Beach
Casino Line  located on the Maritime  Vessel named the Empress II Casino  Cruise
Ship (United States  Official  Number 998517)  ("Vessel" or  "Premises"),  to be
docked at Port of Palm Beach, One East 11th Street, Suite 500, Riviera Beach, FL
33404.  Lessee  acknowledges  and agrees  that the  Premises  is an ocean  going
passenger  vessel built,  constructed and licensed to carry  passengers for hire
under the laws and flag of United States.  In the event of any conflict  between
the terms and provisions of this Lease and the Charter, the terms and provisions
of the Charter shall control.

   4. Term, Rent and Payment, Fees and Charges.

     4.1.  Term.  The term of this Lease shall commence on the date set forth in
each Lease Schedule (the "Commencement  Date") and continue as specified in such
Lease Schedule ("Term").


Master Lease Agreement                                                    Page 1
<PAGE>


     4.2.  Rent and Payment.  Lessee's  obligation to pay rent for the Equipment
shall  commence on the  Commencement  Date and continue for the Term.  The Basic
Rent, as set forth and defined in the Lease Schedules,  shall be payable in such
amount and on such date as set forth in the Lease Schedule.  Any amounts payable
by Lessee, other than Basic Rent, shall be deemed Additional Charges. Additional
Charges  shall be due and  payable  in  accordance  with the  terms of the Lease
Schedule or if not set forth  therein,  on the Basic Rent payment date following
the date upon which the aforesaid  Additional Charges accrue, or the last day of
the Term, whichever is earlier. Lessee shall make all payments at the address of
Lessor set forth  above or at such other  address  as Lessor  may  designate  in
writing.  As used  herein,  the  term  "Rent"  shall  mean  all  Basic  Rent and
Additional Charges as described in the Lease Schedules.

     4.3. Late Charge.  If any Basic Rent, as defined in the Lease Schedule,  is
not received by Lessor or its assignees  within five (5) days of when due then a
late  charge on such Rent shall be due and  payable  with such Rent in an amount
equal to one and  one-half  percent  (1.5%) of the  delinquent  Basic  Rent,  as
defined in the Lease  Schedule,  payable for each month such Basic Rent  remains
delinquent, as reimbursement for administrative costs and not as a penalty.

     4.4.  ACH.  Lessee  shall  complete,  execute  and  deliver  to  Lessor  an
Authorization  for Automatic  Payment form,  which  authorizes  Lessor to deduct
payments of Basic Rent directly from Lessee's  checking or savings  account at a
specified  financial  institution in accordance with this Lease, the Charter and
any Lease Schedules.

     4.5. [Intentionally omitted.]

     4.6. [Intentionally omitted.]

     4.7.  Documentation  Costs, Other Expenses and Charges.  In connection with
the  closing of each  transaction,  Lessee  also  agrees to pay all of  Lessor's
out-of-pocket  expenses  in  connection  with the  closing of each  transaction,
including without  limitation:  [i] documentation  costs for this Lease and each
Lease  Schedule;  [ii] any fees and costs of legal  counsel  utilized  by Lessor
(including  in-house counsel);  [iii] the costs of site and vessel  inspections;
and [iv] all other out-of-pocket expenses incurred by or on behalf of Lessor. At
such time as the Lease closes, the aforementioned  out-of-pocket  expenses shall
not exceed $25,000.00.

     4.8.  Imposts.  In  addition  to the  monthly  Basic Rent due in each Lease
Schedule,  Lessee  agrees  to pay and  indemnify  Lessor  for,  and hold  Lessor
harmless from and against all taxes, assessments,  fees and charges (hereinafter
called "Imposts") together with any penalties,  fines or interest thereon levied
and imposed by any governmental agency or unit (state, local, federal,  domestic
or  foreign),  regardless  of party  assessed  against:  (i) with respect to the
Lease, the Charter or any Lease Schedule; (ii) upon the Equipment,  its value or
any interest of Lessor  and/or Lessee  therein;  (iii) upon or on account of any
sale, rental,  purchase,  ownership,  possession,  use, operation,  maintenance,
delivery or return of the Equipment,  or value added  thereto,  other than taxes
imposed on or measured by the net income or capital of Lessor. The amount of the
Impost shall become  Supplemental Rent to be paid by Lessee within ten (10) days
after  Lessor's  demand.  If any Impost relates to a period during the Term of a
Lease  Schedule such Impost shall  continue,  notwithstanding  the expiration or
termination of the Lease or the Lease Schedule,  until all such Imposts are paid
in full by Lessee.

     4.9.  Lessor's  Performance  of Lessee's  Obligations.  If Lessee  fails to
comply  with any of its  covenants  or  obligations  herein,  Lessor may, at its
option, perform such covenants or obligations on Lessee's behalf without thereby
waiving such  conditions or obligations  or the failure to comply  therewith and
all sums advanced by Lessor in connection therewith shall be repayable by Lessee
as Additional  Charges. No such performance shall be deemed to relieve Lessee of
its obligations herein.

   5.  Certificate of Delivery and Acceptance.  Lessee shall deliver to Lessor a
Certificate of Delivery and Acceptance ("Certificate of Acceptance") in the form
attached to the Charter.

   6. Net Lease.  This Lease  including  each Lease  Schedule is a net lease and
Lessee's  obligation  to pay all  Rent  due  and the  rights  of  Lessor  or its
assignees  in, and to, such Rent shall be absolute and  unconditional  under all
circumstances,   notwithstanding:   [i]  any   setoff,   abatement,   reduction,
counterclaim,  recoupment,  defense,  except the defense of prior payment to the
Lessor in accordance with Lessor's instructions, or other right which Lessee may
have against  Lessor,  its assignees,  the  manufacturer or seller of any of the
Equipment,  or any other person for any reason  whatsoever,  including,  without
limitation,  any breach by Lessor of this Lease; [ii] any defect in title (other
than defects and exceptions caused by Lessor), condition, operation, fitness for
use,  or any damage to or  destruction  of and of the  Equipment,  except to the
extent  resulting from the gross  negligence or willful  misconduct of Lessor or
any of its  employees,  agents or  representatives;  [iii] any  interruption  or
cessation of use or possession  of the  Equipment for any reason,  except to the
extent  resulting from the gross  negligence or willful  misconduct of Lessor or
any of its  employees,  agents  or  representatives;  or  [iv]  any  insolvency,
bankruptcy,  reorganization  or  similar  proceedings  instituted  by or against
Lessee.

   7. Grant of Security Interest.


Master Lease Agreement                                                    Page 2
<PAGE>


     7.1.  In order to secure  prompt  payment  of the Rent and all of the other
amounts from time to time  outstanding  under and with respect to this Lease and
any Lease  Schedule,  and the  performance  and  observance by Lessee of all the
agreements,  covenants and provisions thereof,  Lessee hereby grants to Lessor a
first  priority   security  interest  in  the  Equipment   (including,   without
limitation,  all  inventory,  fixtures or other  property  comprising  the same)
together  with  all  software  (embedded  therein  or  otherwise),  Intellectual
Property (as defined herein) and general intangibles  necessary for operation of
the Equipment,  all additions,  attachments,  accessions  thereto whether or not
furnished  by the  supplier  of  the  Equipment,  all  subleases,  charters  and
subcharters of the Equipment,  and security deposits under any of the foregoing,
and any and all  substitutions,  replacements  or exchanges for any such item of
Equipment,  in each case in which  Lessee  shall  from time to time  acquire  an
interest,  and any and all insurance  and/or other  proceeds of the Equipment in
and which a security interest is granted hereunder.

     7.2.  Lessee  hereby  acknowledges  and agrees that to the extent  Lessor's
participation  in any  purchase  and lease of an item or items of the  Equipment
pursuant  to this  Lease,  the  Charter  or any  Lease  Schedule  constitutes  a
financing of the purchase of such item or items of Equipment, Lessee's repayment
of the amounts of such financing shall apply on a "first-in-first-out"  basis so
that the portions of the amounts of such financing used to purchase such item or
items of Equipment shall be deemed re-paid in the chronological order of the use
of such amounts to purchase the same.

   8. Location, Use, Maintenance, and Inspection.

     8.1. Location, Use, Maintenance and Repairs.

          8.1.1.  Lessee shall keep and use the Equipment in accordance with the
terms and conditions of the Charter.

          8.1.2.  Lessee  shall at all times and, at its sole cost and  expense,
properly use and maintain the Equipment in good operating condition,  other than
the  normal  wear and tear,  and make all  necessary  repairs,  alterations  and
replacements thereto (collectively,  "Repairs"),  all of which shall immediately
become the property of Lessor and subject to this Lease.

          8.1.3. Lessee shall comply with manufacturer  instructions relating to
the Equipment, and any applicable laws and governmental regulations.

          8.1.4.  Lessee shall pay all reasonable costs and expenses  associated
with removal and return of the Equipment.

     8.2.  Identification and Inspection.  Upon request by Lessor,  Lessee shall
mark any Equipment  conspicuously  with appropriate  labels or tags furnished by
Lessor and maintain such markings through the Term to clearly disclose that said
Equipment is being leased from Lessor.  Subject to Lessee's  reasonable security
requirements, Lessee shall permit Lessor's representatives to enter the Premises
to inspect any Equipment in accordance with the Charter.

   9. Location, Property Rights, and Liens.

     9.1.  Personal  Property.  All of the  Equipment  is personal  property and
Lessee shall not affix any of the Equipment to realty so as to change its nature
to a fixture or real property and agrees that all of the Equipment  shall remain
personal  property during the Term. Lessor expressly retains ownership and title
to the Equipment. Lessee hereby agrees that it shall notify Lessor of any change
in  Florida  gaming  laws or  regulations  affecting  Lessor  as a result of its
ownership of the Equipment,and assist Lessor in complying with, at Lessee's sole
expense,  all of Lessor's  obligations  as required by the state gaming laws and
regulations  regarding  maintenance,   use,  possession  and  operation  of  the
Equipment.  Lessee hereby  authorizes,  empowers,  and grants a limited power of
attorney to Lessor to record and/or  execute and file, on Lessee's  behalf,  any
certificates,  memorandums,  statements,  refiling, and continuations thereof as
Lessor  deems  reasonably  necessary  or  advisable  to preserve and protect its
interest  hereunder.  The  parties  intend to create a lease  agreement  and the
relationship  of lessor and  lessee  between  themselves.  Nothing in this Lease
shall be construed or  interpreted to create or imply the existence of a finance
lease or installment lease contract.  Lessor makes no  representation  regarding
the treatment of this Lease,  the Equipment or the payment of obligations  under
this Lease for financial statement reporting or tax purposes.

     9.2. Protection of Lessor's Property Rights.  Lessor has the right to place
on any part of the  Equipment,  a medallion  or other  marker of  suitable  size
stating in substance [i] that the Equipment is the property of Lessor,  and [ii]
that  Lessor,  to protect its rights,  has filed or retains the right to file in
appropriate government offices a UCC Financing Statement covering the Equipment.
Lessee  hereby  authorizes  Lessor  to  file  any  and all  UCC-1  and/or  UCC-3
statements and/or amendments  thereto related to this Lease, any Lease Schedule,
and/or the Equipment without Lessee's authentication, to the extent permitted by
applicable  law.  If directed to do so by Lessor,  Lessee  will  cooperate  with
Lessor in preparing and filing such UCC statements  and/or  amendments  thereto.
Lessee  hereby  agrees that by  executing  this Lease,  the Charter or any Lease
Schedule  that the same  shall  constitute  Lessee's  authorization  for all UCC
statements and/or  amendments  thereto related to this Lease, any Lease Schedule
and/or the Equipment.


Master Lease Agreement                                                    Page 3
<PAGE>


     9.3.  Accessions.  Lessee  agrees  that  if any  part of the  Equipment  is
physically attached to other personal property that the Equipment shall not lose
its identity and shall constitute an accession. Lessor shall at all times herein
retain its interests in the Equipment  and such  interest  shall  continue to be
perfected notwithstanding its becoming an accession.

     9.4. Liens and  Encumbrances.  Unless  otherwise  provided herein or in the
Charter,  Lessee  shall not  directly or  indirectly  create,  incur or suffer a
mortgage,   claim,  lien  (other  than  unrecorded   maritime  liens),   charge,
encumbrance  or the legal  process of a  creditor  of Lessee of any kind upon or
against  this Lease or any  Equipment.  Lessee  shall at all times  protect  and
defend,  at its own cost and expense,  the title of Lessor from and against such
mortgages,  claims,  liens  (other than  unrecorded  maritime  liens),  charges,
encumbrances  and legal  processes of creditors of Lessee and shall keep all the
Equipment  free and clear from all such  mortgages,  claims,  liens  (other than
unrecorded maritime liens),  charges,  encumbrances and legal processes.  If any
such mortgage,  claim,  lien (other than unrecorded  maritime liens),  charge or
encumbrance is incurred,  Lessee shall immediately  notify Lessor and shall take
all actions required by Lessor to remove the same. Lessee shall indemnify Lessor
against  and  hold  Lessor  harmless  from  any  and  all  costs,   obligations,
liabilities,  penalties,  damages  or  other  charges  and any and all  expenses
reasonably incurred in connection with investigating, defending or asserting any
claim,  action,  suit or proceeding  incident to any matter indemnified  against
hereunder  incurred  by Lessee in  connection  with or arising  from any claims,
liens,  charges,  encumbrances and legal processes upon or against this Lease or
any Equipment.

   10. Return of Equipment.

     10.1. Duty of Return.  At the expiration of any Term or upon termination of
the Lease,  unless Lessee exercises or is deemed to have exercised its option to
purchase the Equipment  from Lessor under this Lease,  the Lease Schedule or the
Charter,  Lessee at its expense  shall return all of the  Equipment to Lessor or
its  designee in  accordance  with terms and  provisions  of the Charter and any
appropriate  gaming laws and  regulations  and the terms and  conditions  of the
Lease Schedule.

     10.2. [Intentionally omitted.]

   11. Risk of Loss, Insurance.

     11.1. Risk of Loss. Lessee shall bear the risk of all loss or damage to any
Equipment or caused by any Equipment during the Term of this Lease.

     11.2.  Equipment  Replacement.  Unless Lessee exercises its purchase option
under this Lease,  the Lease  Schedule or the  Charter,  and except as otherwise
provided  in the  Charter,  if  any  part  of the  Equipment  is  lost,  stolen,
destroyed,  seized by  governmental  action or, in Lessee's  opinion or Lessor's
opinion,  damaged  ("Event of Loss"),  this Lease shall remain in full force and
effect  without  abatement  of Rent  and  Lessee  shall  promptly  replace  such
Equipment at its sole expense with  Equipment of  equivalent  value and utility,
and  similar  kind and in  substantially  the  same  condition  as the  replaced
Equipment  immediately  prior to the  Event of Loss.  Title to such  replacement
Equipment  immediately shall vest and remain in Lessor, and such Equipment shall
be deemed Equipment under this Lease and the applicable  Lease Schedule.  Lessor
shall cause to be paid to Lessee or the vendor of the replacement  Equipment any
insurance  proceeds actually received by Lessor as a result of the Event of Loss
promptly upon receipt of such proceeds.  Lessee shall promptly  notify Lessor of
any Event of Loss and shall  provide  Lessor with and shall enter into,  execute
and deliver such documentation,  as Lessor shall reasonably request with respect
to the  replacement of any such  Equipment.  Notwithstanding  the foregoing,  if
there occurs an Event of Loss which constitutes,  in Lessee's opinion, an actual
or  constructive  total loss of all or a substantial  portion of the  Equipment,
then Lessee shall have the option, exercisable upon written notice to Lessor, to
terminate this Lease and purchase the Equipment in accordance with Section 21.2;
provided,  however,  that if Lessee opts to purchase the Equipment under Section
21.2,  then any insurance  proceeds  actually  received by Lessor as a result of
such Event of Loss shall be used to offset the amount due from  Lessee to Lessor
under Section 21.2 and the excess, if any, shall be promptly paid to Lessee.

     11.3. Insurance.

          11.3.1.  Lessee  shall  obtain and  maintain  in full force and effect
insurance in accordance  with the provisions of the Charter.  SUCH INSURANCE MAY
NOT BE CANCELED OR  MATERIALLY  ALTERED  WITHOUT  THIRTY (30) DAYS PRIOR WRITTEN
NOTICE TO LESSOR.

          11.3.2.  All such  insurance  required  herein  shall be  placed  with
companies  having a rating of at least A,  Class XII or better by Best's  rating
service.  Lessee shall maintain the insurance throughout the contract period and
furnish to Lessor until the payment in full of any obligations herein, insurance
certificates  of a kind  satisfactory  to Lessor  showing the  existence  of the
insurance required hereunder and premium paid.

   12.  Lessor's  Purchase and  Performance.  Upon  receipt of a Lease  Schedule
executed and  delivered by Lessor,  Lessee shall


Master Lease Agreement                                                    Page 4
<PAGE>


bear all  responsibilities and perform all material obligations of Lessor, which
may arise as a result of any document or agreement  between  Lessor and a vendor
in connection with the Equipment to be leased under said Lease  Schedule,  other
than payment of the purchase price; provided that Lessor has provided materially
correct and complete  copies of any and all such  documents  and  agreements  to
Lessee prior to the execution of such Lease Schedule.

   13. Taxes.

     13.1.  Taxes.  Lessee agrees to report,  file, pay promptly when due to the
appropriate taxing authority and inemnify, defend, and hold Lessor harmless from
and against any and all taxes (including gross receipts),  assessments,  license
fees and  other  federal,  state or local  governmental  charges  of any kind or
nature,  together  with  any  penalties,   interest  or  fines  related  thereto
(collectively,  "Taxes") that pertain to the  Equipment,  its purchase,  or this
Lease,  except such Taxes based solely upon the net income or capital of Lessor,
including,  but not necessarily limited to all property,  sales and/or use taxes
levied or  assessed  regardless  of whether  such  taxes are levied or  assessed
against Lessor or Lessee.

     13.2. Lessor's Filing of Taxes.  Notwithstanding  the foregoing,  Lessor at
its election  may report and file sales and/or use tax reports,  which are filed
and paid  periodically  through the Term, and the amounts so due may be invoiced
to Lessee and payable as specified  therein,  except if and to the extent Lessee
provides a resale or other sales tax exemption certificate.

   14.  Indemnification.  Except for the negligence of Lessor,  its employees or
agents and assigns, Lessee hereby assumes liability for and agrees to indemnify,
defend,  protect,  save and hold  harmless  the Lessor,  its agents,  employees,
directors and assignees from and against any and all losses, damages,  injuries,
claims,  administration of claims, penalties, demands and all expenses, legal or
otherwise  (including  reasonable  attorneys'  fees) of whatever kind and nature
arising  from  (a)  the  purchase,  ownership,  use,  condition,   operation  or
maintenance of the Equipment,  or (b) any agreement  between Lessor and a vendor
(including purchase or sales orders) which was reasonably approved by Lessee, in
each case until the Equipment is returned to Lessor. Any claim, defense, setoff,
or other right of Lessee against any such indemnified party shall not in any way
affect,  limit, or diminish Lessee's indemnity  obligations  hereunder.  Each of
Lessor and Lessee  shall  notify the other  party  immediately  as to any claim,
suit, action, damage, or injury related to the Equipment of which such party has
actual or other notice.  Lessee shall,  at its own cost and expense,  defend any
and all suits  within  the scope of its  indemnification  obligation,  including
frivolous  suits and  claims,  which may be  brought  against  Lessor  and shall
satisfy, pay and discharge any and all judgments and fines that may be recovered
against  Lessor in any such action or actions,  provided,  however,  that Lessor
shall give Lessee written notice of any such claim or demand. Lessee agrees that
its  obligations  under this section shall survive the expiration or termination
of this Lease.

   15. Representations,  Warranties and Covenants.  Lessee hereby represents and
warrants to Lessor that:

     15.1. It is an entity duly organized, validly existing and in good standing
under the laws of the state of its formation;

     15.2.  Lessee's true legal name is as set forth in this  Agreement and that
is shall not change its name or jurisdiction of organization without thirty (30)
days' written notice to Lessor;

     15.3. It has the power and  authority to execute,  deliver and perform this
Agreement and other instruments and documents required or contemplated herein;

     15.4.  The execution,  delivery and  performance of this Agreement has been
duly authorized by all necessary action on the part of Lessee, does not and will
not require the approval of any other interested  parties of Lessee and does not
and will not  contravene  any  Certificate  or Articles of formation or internal
by-laws  or  agreement  of  Lessee,  and does not  constitute  a default  of any
indenture,  contract, agreement, mortgage, deed of trust, document or instrument
to which Lessee is a party or by which Lessee is bound;

     15.5.  The person(s)  executing  this  Agreement on behalf of Lessee has or
have been properly authorized to execute the same;

     15.6. Lessee has obtained,  maintains,  and will maintain, on an active and
current  basis,  all  licenses,  permits,  registrations,  approvals  and  other
authority as may be required  from any  applicable  federal,  state,  tribal and
local  governments  and  agencies  having  jurisdiction  over it and the subject
matter of this Agreement;

     15.7. There are no suits,  actions,  proceedings or investigations  pending
or, to  Lessee's  knowledge,  threatened  or, to Lessee's  knowledge,  any basis
therefor which might  materially  adversely  affect the ability of it to perform
its obligations  under this Agreement or have a material adverse effect upon the
financial condition of it or the validity or enforceability of this Agreement;

     15.8.  Except for cases no.  03-30038  and  03-30039  pending in the United
States Bankruptcy Court,  Southern District of Florida,  Lessee is not currently
the subject of any pending or threatened bankruptcy or insolvency proceeding;


Master Lease Agreement                                                    Page 5
<PAGE>


     15.9. Lessee is not presently  insolvent and this Agreement will not render
Lessee insolvent.  As used in this section,  the term "insolvent" means that the
sum  total  of  all of  Lessee's  liabilities  (whether  secured  or  unsecured,
contingent or fixed, or liquidated or unliquidated) is in excess of the value of
Lessee's  non-exempt  assets  (i.e.  all of the  assets of the  entity  that are
available to satisfy claims of creditors);

     15.10. As of the date hereof,  its obligations under this Agreement are not
subject to any defense, set off or counterclaim;

     15.11.  Lessee is not  currently  aware of any  event,  condition,  fact or
circumstance, which, after the execution of this Agreement, would prevent Lessee
from having  sufficient  working  capital to pay all of  Lessee's  debts as they
become due;

     15.12.  This Agreement  constitutes the valid and legally binding agreement
of Lessee and is enforceable against Lessee in accordance with its terms, except
to the extent that  enforcement  of any  remedies  may be limited by  applicable
bankruptcy,  insolvency,  general  principles  of equity or other  similar  laws
affecting generally the enforcement of creditor's remedies;

     15.13.  There have been no amendments,  modifications,  waivers or releases
with respect to this Agreement or any provisions hereof, whether oral or written
prior to execution hereof;

     15.14.  The Lessee's state of formation and/or the location of the Premises
will not be changed  without  thirty (30) days' prior written  notice to Lessor;
and

     15.15. No order, consent,  approval,  license,  authorization or validation
of,  or  filing,   recording  or   registration   with,  or  exemption  by,  any
governmental,  regulatory  or public or tribal body or  authority is required in
connection  with  Lessee's  execution,  delivery  and  performance  of,  or  the
legality, validity, binding effect or enforceability of this Agreement.

     15.16.  All financial  statements  concerning the Lessee and its guarantors
that have been  delivered as of the date of this Agreement have been prepared in
accordance with GAAP consistently applied throughout the periods covered (except
as disclosed therein and except, with respect to unaudited financial statements,
for the absence of footnotes and normal year-end audit  adjustments) and present
fairly in all  material  respects  the  financial  position  of the  persons and
entities  covered  thereby  as at the  dates  thereof  and the  results  of such
person's or entities  operations and cash flows for the periods then ended.  Any
projections  delivered to Lessor on or prior to the date of this  Agreement have
been prepared by Lessee in light of the past operations of its businesses.  Such
projections  are based upon estimates and  assumptions  stated  therein,  all of
which Lessee  believes to be reasonable and fair in light of current  conditions
and current facts known to Lessee and, as of the date of this Agreement, reflect
Lessee's good faith and reasonable estimates of the future financial performance
of Lessee, the Vessel, the casino gaming operations and of the other information
projected therein for the period set forth therein.

     15.17. Between the date of Lessee's most recent annual financial statements
and the date of this  Agreement,  (a) Lessee has not incurred  any  obligations,
contingent or  non-contingent  liabilities,  liabilities for charges,  long-term
leases or unusual  forward or long-term  commitments  which are not reflected in
the  financial  statements  provided  to  Lessor  and  which,  alone  or in  the
aggregate, could reasonably be expected to have a material adverse effect on the
financial  condition  of Lessee or Lessee's  ability to perform its  obligations
under this  Lease,  the  Charter or any  related  documents  ("Material  Adverse
Effect"),  (b) no  contract,  lease or other  agreement or  instrument  has been
entered into by any Lessee or has become binding upon any Lessee's assets and no
law or  regulation  applicable  to any Lessee has been adopted  which has had or
could  reasonably  be expected  to have a Material  Adverse  Effect,  and (c) no
Lessee is in default and to the best of any Lessee's knowledge no third party is
in default under any contract,  lease or other  agreement or  instrument,  which
alone or in the  aggregate  could  reasonably  be  expected  to have a  Material
Adverse  Effect.  Between the date of  Lessee's  most  recent  annual  financial
statements and the date of this Agreement, no event has occurred which, alone or
together  with other  events,  could  reasonably  be expected to have a Material
Adverse Effect.

     15.18.  As of the date of this  Agreement (a) no strikes or other  material
labor  disputes  against any Lessee are pending or, to any  Lessee's  knowledge,
threatened,  (b) hours  worked by and payment  made to  employees of each Lessee
comply with all federal,  state, local or foreign law applicable to such matter,
(c) all payments due from any Lessee for employee  health and welfare  insurance
have been paid or accrued as a liability on the books of such Lessee,  (d) there
is no  organizing  activity  involving  any Lessee  pending or, to any  Lessee's
knowledge, threatened by any labor union or group of employees, (e) there are no
representation  proceedings  pending or, to any Lessee's  knowledge,  threatened
with the National Labor Relations Board,  and no labor  organization or group of
employees of any Lessee has made a pending demand for recognition, and (f) there
are no complaints or charges  against any Lessee pending or, to the knowledge of
any Lessee, threatened to be filed with any governmental authority or arbitrator
based on,  arising out of, in  connection  with,  or  otherwise  relating to the
employment or termination of employment by and Lessee of any individual.

     15.19.  As of the Closing  Date,  each Lessee owns or has rights to use all
trademarks,   service  marks,   records,   technology,   inventions,


Master Lease Agreement                                                    Page 6
<PAGE>


know-how, specifications, modifications, information, and any other intellectual
property  necessary  to continue to conduct  its  business as now or  heretofore
conducted  by it or proposed to be conducted  by it  ("Intellectual  Property").
Each Lessee  conducts  its  business  and  affairs  without  infringement  of or
interference with any Intellectual Property of any other person or entity in any
material  respect.  No  Lessee is aware of any  infringement  claim by any other
person or entity with respect to any Intellectual Property.

     15.20.  As of the  date of this  Agreement,  no  Lessee  is a party  to any
contract or agreement with any governmental  authority and no Lessee's  accounts
(as defined in the United States Code) are subject to the Federal  Assignment of
Claims Act (31 U.S.C.  Section 3727), as amended,  or any similar state or local
law.

     15.21. No information  contained in this Agreement,  any of the other Lease
Documents,  any  projections,  financial  statements,  or SEC  filings  or other
reports from time to time delivered hereunder or any written statement furnished
by or on behalf of any  Lessee to Lessor  contains  or will  contain  any untrue
statement  of a  material  fact or omits or will omit to state a  material  fact
necessary to make the statements  contained  herein or therein not misleading in
light of the circumstances under which they were made.

     15.22.  Lessee  shall not  directly or  indirectly,  by operation of law or
otherwise merge,  consolidate or otherwise combine with any sole proprietorship,
partnership,  joint venture, trust,  unincorporated  organization,  association,
corporation,  limited liability company, institution, public benefit corporation
or other entity (any of the foregoing, a "Person").

     15.23.  Lessee  shall  not  create,  incur,  assume  or permit to exist any
Indebtedness (as defined below) other than (i) Indebtedness existing on the date
hereof,  (ii)  Indebtedness  incurred  pursuant to the Lease, the Charter,  that
certain  Master  Lease  Agreement  (Empress  II and Palm Beach  Princess  Gaming
Equipment)  ("Master  Equipment Lease") of even date herewith between PDS Gaming
Corporation,  a Minnesota  corporation  ("PDS"),  and ITG Vegas,  Inc., a Nevada
corporation ("ITG"), that certain Bareboat Charter and Option to Purchase ("Palm
Beach Princess  Charter") of even date herewith among Cruise  Holdings I, LLC, a
Nevada limited  liability company ("Cruise I"), MJQ and PBE, that certain Master
Lease  Agreement  (Palm Beach  Princess  Vessel)  ("Palm Beach  Princess  Master
Lease") of even date herewith  among Cruise I, MJQ and PBE, as  supplemented  by
any  lease  schedules  set  forth  therein  and/or  for  the  sole  purposes  of
maintaining,  expanding  or  enhancing  ITG's and its  affiliates'  business  of
operating  the  Vessel and that  certain  Maritime  Vessel  named the Palm Beach
Princess (IMO Number:  8402937,  Registration Number:  14348-84-D (Panama),  DNV
Class Number: 02720) (the "Operations") (collectively, "Permitted Indebtedness")
or (iii)  Indebtedness  incurred by a  subsidiary  or  affiliate  of ITG for the
purpose  of  acquiring,  maintaining,   expanding  or  enhancing  any  business,
provided,  such  Indebtedness  (if other  than  Permitted  Indebtedness)  is not
created, assumed or guaranteed by Lessee or ITG.

     15.24.  Lessee  shall  not  create,  incur,  assume  or permit to exist any
obligation  guaranteeing any Indebtedness,  lease, dividend, or other obligation
of any  other  Person  in any  manner  (except  for  indorsement  of  items  and
instruments  in process of  collection),  other than the  guaranty of  Permitted
Indebtedness.   For  purposes  of  this  Lease,  "Indebtedness"  means  (i)  all
indebtedness  for borrowed money,  (ii) that portion of obligations with respect
to capital leases which is properly classified as a liability on a balance sheet
in conformity with GAAP,  (iii) notes payable and drafts  accepted  representing
extensions of credit whether or not representing obligations for borrowed money,
(iv) any obligation  owed for all or any part of the deferred  purchase price of
assets,  real or personal  property or services  which purchase price is (a) due
more  than six (6)  months  from the date of  incurrence  of the  obligation  in
respect thereof, or (b) evidenced by a note or similar written  instrument,  and
(v) all indebtedness  secured by any lien on any property or asset owned or held
by ITG or any of its subsidiaries regardless of whether the indebtedness secured
thereby shall have been assumed by such Person or is  nonrecourse  to the credit
of such Person.

   16. Warranty, Disclaimers and Limitations of Liability.

     16.1. Equipment. Lessor makes no warranties, express or implied, including,
but not limited to,  warranties of  merchantability  or fitness for a particular
purpose  with  regard to any  Equipment  acquired  by Lessor for lease to Lessee
hereunder  from an  Original  Equipment  Manufacturer  or Supplier  ("OEM").  No
affirmation  of  fact,  including,  but not  limited  to,  statements  regarding
suitability  for use or performance  of such  Equipment  shall be deemed to be a
warranty of Lessor for any purpose. All OEM warranties,  if any, shall extend to
Lessee,  subject to the terms and  conditions  of said OEM  warranty  and to the
extent as it may apply to any  Equipment  leased herein and, upon the request of
Lessee, Lessor shall cooperate with Lessee to enforce any OEM warranty.

     16.2.  Disclaimer and  Limitations of Liability.  Notwithstanding  anything
herein to the  contrary,  Lessor  shall  not be  responsible  or liable  for any
revenues  foregone  by the  Lessee,  while  any  part  of the  Equipment  is not
functioning  properly.  Lessor shall also not be  responsible  or liable for any
losses, damages, injuries, claims, penalties, demands and all expenses, legal or
otherwise  (including  reasonable  attorneys'  fees) of whatever kind and nature
arising from any patron  disputes  involving  such  Equipment.  The liability of
Lessor for any of the Equipment leased hereunder,  whether in contract, in tort,
under warranty, in negligence or


Master Lease Agreement                                                    Page 7
<PAGE>


otherwise,  shall not exceed the fair market value of the  Equipment  itself and
under no circumstances shall Lessor be liable for direct, special,  indirect, or
consequential  damages,  except for breach of Section  16.3  hereof,  failure to
fulfill its obligations under Section 20.2 hereof and breach of Article 19.F. of
the Charter. Any unauthorized  modification,  alteration,  or revision of all or
any portion of the Equipment shall cause the warranty described above to be null
and void. Lessor, its affiliates, subsidiaries, representatives, and agents make
no other  warranty,  express or implied.  IN NO EVENT SHALL LESSOR BE LIABLE FOR
DIRECT,   INDIRECT,   SPECIAL,  OR  CONSEQUENTIAL  DAMAGES,   INCLUDING  WITHOUT
LIMITATION LOSS OF PROFITS,  ARISING OUT OF THIS LEASE, THE CHARTER OR ANY LEASE
SCHEDULE  REGARDLESS  OF THE NATURE OF ANY CLAIM MADE BY LESSEE,  BUT  EXCLUDING
DAMAGES RESULTING FROM LESSOR'S BREACH OF SECTION 16.3 OR FAILURE TO FULFILL ITS
OBLIGATIONS UNDER SECTION 20.2 HEREOF OR ARTICLE 19.F. OF THE CHARTER.

     16.3.  Covenant of Lessor.  Lessor hereby  covenants and agrees that Lessor
will not  permit  or  suffer  to  exist  any  lien,  claim,  liability  or other
encumbrance  on or  against  the  Equipment  by,  to or of any  person or entity
claiming through Lessor, which impairs Lessee's rights to quiet enjoyment or the
purchase option under this Lease, except to the extent attributable to any Event
of  Default  by  Lessee.  Lessor  shall and shall be  entitled  to a  reasonable
opportunity to cure,  contest or defend against any such lien, claim,  liability
or other encumbrance.

     16.4.  Representations  and Warranties of Lessor.  Lessor hereby represents
and warrants to Lessee that:

          16.4.1.  It is an entity duly organized,  validly existing and in good
standing under the laws of the state of its formation;

          16.4.2. It has the power and authority to execute, deliver and perform
this  Agreement and other  instruments  and documents  required or  contemplated
herein;

          16.4.3. The execution,  delivery and performance of this Agreement has
been duly authorized by all necessary action on the part of Lessor, does not and
will not require the approval of any other interested parties of Lessor and does
not and will not contravene any Certificate or Articles of formation or internal
by-laws or agreement of Lessor,  and does not  constitute a material  default of
any  indenture,  contract,  agreement,  mortgage,  deed of  trust,  document  or
instrument to which Lessor is a party or by which Lessor is bound;

          16.4.4. The person(s) executing this Agreement on behalf of Lessor has
or have been properly authorized to execute the same;

          16.4.5.  This  Agreement  constitutes  the valid and  legally  binding
agreement of Lessor and is  enforceable  against  Lessor in accordance  with its
terms,  except to the extent that  enforcement of any remedies may be limited by
applicable bankruptcy, insolvency, general principles of equity or other similar
laws affecting generally the enforcement of creditor's remedies;

          16.4.6.  Lessor has  obtained,  maintains,  and will  maintain,  on an
active and current basis, all licenses,  permits,  registrations,  approvals and
other authority as may be required from any applicable  federal,  state,  tribal
and local  governments and agencies having  jurisdiction over it with respect to
the subject matter of this  Agreement,  except to the extent that the failure to
obtain  and/or  maintain any such licenses  could not  reasonably be expected to
have a  material  adverse  affect  on the  ability  of  Lessor  to  perform  its
obligations hereunder;

          16.4.7.  There are no suits,  actions,  proceedings or  investigations
pending or, to Lessor's  knowledge,  threatened or, to Lessor's  knowledge,  any
basis  therefor  which might  materially  adversely  affect the ability of it to
perform its obligations  under this Agreement or have a material  adverse effect
upon the  financial  condition of it or the validity or  enforceability  of this
Agreement; and

          16.4.8.  To the  knowledge  of Lessor,  no order,  consent,  approval,
license,  authorization  or validation of, or filing,  recording or registration
with, or exemption by, any governmental,  regulatory or public or tribal body or
authority is required in connection with the execution, delivery and performance
of,  or the  legality,  validity,  binding  effect  or  enforceability  of  this
Agreement.

   17. Assignment of Lease. Lessee acknowledges and agrees that Lessor may sell,
assign,  mortgage,  or otherwise  transfer its interest  hereunder and/or in the
Equipment  to others  ("Assignees")  without  any  consent of  Lessee,  provided
however that Lessee shall be promptly  notified of any  assignment and that each
Assignee shall expressly take  assignment  subject to this Lease and the Charter
and agree to recognize Lessee's rights under this Lease, including expressly the
right to quiet  enjoyment,  use and  possession  of the  Equipment so long as no
Event of Default  exists under the Lease,  during,  and pursuant to Section 21.2
after,  the term of this  Lease;  provided  further  that,  notwithstanding  the
foregoing, if such Assignee is PDS Funding 2004-A, LLC


Master Lease Agreement                                                    Page 8
<PAGE>


or any of its successors or assigns,  such assignment  shall be taken subject to
the terms of that certain Notice,  Consent and  Acknowledgment  of Assignment or
Sale of even date herewith by and among Lessor, Lessee, PDS, Cruise II, ITG, ITG
Palm Beach,  LLC and  International  Thoroughbred  Breeders,  Inc.  Accordingly,
Lessee and Lessor agree that upon such assignment,  Lessee (i) shall acknowledge
such assignment in writing by executing a Notice,  Consent and Acknowledgment of
Assignment furnished by Lessor; (ii) shall promptly pay all Rent when due to the
designated   Assignees,   notwithstanding   any  defense,   setoff,   abatement,
recoupment,  reduction or  counterclaim  whatsoever that Lessee may have against
Lessor;  (iii) shall not permit the Lease,  the Charter or any Lease Schedule so
assigned to be amended or the terms  thereof  waived  without the prior  written
consent of the  Assignees;  (iv) shall not require the  Assignees to perform any
obligations  of Lessor  under such Lease  Schedule;  (v) shall not  terminate or
attempt to terminate the Lease,  the Charter or any Lease Schedule on account of
any default by Lessor,  so long as such default does not result in the denial of
Lessee's  quiet  enjoyment,  use  and  possession  of the  Equipment;  and  (vi)
acknowledges  that any Assignee  may  reassign its rights and interest  with the
same force and  effect as the  assignment  described  herein.  Lessee  shall not
assign this Lease,  the Charter or any Lease Schedule or assign its rights in or
sublet the Equipment,  or any interest therein,  except pursuant to that certain
Sub-Bareboat  Charter of even date  herewith  between  Lessee  and ITG,  without
Lessor's and its Assignee's  prior written  consent,  which consent shall not be
unreasonably withheld.

   18. Financial Information, Lease Agreement.

     18.1. Financial  Information.  Lessee will provide Lessor monthly financial
statements  within thirty (30) days of each calendar month and annual  financial
statements  provided within ninety (90) days of fiscal year-end.  Throughout the
Term,  upon the  reasonable  request of Lessor,  Lessee shall  deliver to Lessor
copies of other current financial information of Lessee and any parent entity of
Lessee,  which will reflect the financial  condition and operations of Lessee as
well as such other information  regarding Lessee reasonably  requested by Lessor
or its Assignees.

     18.2.  Lease  Agreement.  If any  court of  competent  jurisdiction  should
determine  that this Lease  constitutes a security  arrangement  as opposed to a
true lease,  the parties then agree that this Lease shall  constitute a security
agreement within the meaning of the Uniform  Commercial Code and that the Lessor
shall be  considered a secured party under the  provisions  thereof and shall be
entitled  to all the rights  and  remedies  of a secured  party and  Lessee,  as
debtor,  grants  to  Lessor,  as  secured  party,  a  security  interest  in the
Equipment; provided nothing herein shall be construed nor shall the inclusion of
this  paragraph  be  interpreted  as  derogating  from  the  stated  intent  and
contractual understanding of the parties that this is a true lease.

   19. Default by Lessee. Lessee shall be deemed in default under this Agreement
upon the occurrence of any one of the following events ("Event of Default"):

     19.1.  Failure to make any payment of Basic Rent or Cash Flow Sweep  within
ten (10) days of when due under this Lease,  the Charter and any Lease  Schedule
by its due date;

     19.2. Lessee's cancellation,  termination, alteration, or rescission of the
Authorization for Automatic Payment without the prior approval of Lessor;

     19.3.  Lessee's  rejection of any authorized  withdrawal,  payment or entry
permitted by the Authorization for Automatic Payment;

     19.4. Failure to perform in any material respect any other obligation under
this Agreement,  any Lease Schedule,  Master Lease, Charter or any other written
agreement between Lessee and Lessor, regardless of whether such other agreement,
lease or charter covers the same or similar maritime vessel or gaming equipment,
within thirty (30) days after  receipt of written  notice of default and failure
to cure; provided,  however,  that no notice shall be required where a breach or
threatened  breach  would  cause  irreparable  harm to  Lessor  and  Lessor  may
immediately seek equitable relief in a court of competent jurisdiction to enjoin
such breach;

     19.5.  Lessee  shall  generally  fail to pay its debts as they  become due,
shall make an  assignment  for the  benefit  of its  creditors,  shall  admit in
writing its inability to pay its debts as they become due, shall file a petition
under any chapter of the Federal  Bankruptcy  Code or any similar law,  state or
federal,  now or hereafter  existing,  shall become  "insolvent" as that term is
generally  defined under the Federal  Bankruptcy  Code, shall in any involuntary
bankruptcy  case  commenced  against it file an answer  admitting  insolvency or
inability  to pay its  debts  as they  become  due,  or shall  fail to  obtain a
dismissal  of  such  case  within  one  hundred  twenty  (120)  days  after  its
commencement or convert the case from one chapter of the Federal Bankruptcy Code
to another chapter,  or be the subject of an order for relief in such bankruptcy
case, or be adjudged a bankrupt or insolvent, or shall have a custodian, trustee
or receiver  appointed for, or have any court take jurisdiction of its property,
or any part  thereof,  in any  proceeding  for the  purpose  of  reorganization,
arrangement, dissolution or liquidation, and such custodian, trustee or receiver
shall not be discharged, or such jurisdiction shall not be relinquished, vacated
or stayed within sixty (60) days of the appointment;

     19.6.  Lessee  materially   defaults  under  any  mortgage,   indenture  or
instrument  under  which there may be issued or by which


Master Lease Agreement                                                    Page 9
<PAGE>


there  may be  secured  or  evidenced,  any  indebtedness  of  Lessee  for money
borrowed,  whether such  indebtedness now exists or shall be created  hereafter,
which material default (monetary or otherwise) is not cured within (30) days;

     19.7.  Lessee shall be  dissolved,  liquidated  or wound up or is enjoined,
restrained, fails or is in any way prevented from maintaining its existence as a
going   concern  in  good   standing   (excepting,   however,   reorganizations,
consolidations  and/or mergers into or with, and sales to,  affiliates owned by,
owning  or  under  common  control  of  or  with  Lessee  and   reorganizations,
consolidations and/or mergers resulting from the death of Frances W. Murray);

     19.8.  Lessee  attempts  to remove,  sell,  transfer,  encumber,  part with
possession or sublet any part of the Equipment without the prior written consent
of Lessor other than in the ordinary course of business or as otherwise provided
in the Charter;

     19.9.  Any part of the  Equipment,  which is material to the  operation  of
Lessee's  business  or  the  functionality  of  the  Vessel,  is  lost,  stolen,
materially  changed  or  destroyed,  and is not  replaced  by  Lessee  within  a
reasonable period of time;

     19.10.  Any part of the  Equipment  is attached,  levied upon,  encumbered,
pledged,  or seized under any judicial process,  unless  attributable to acts or
debts of Lessor;

     19.11. Any warranty or representation  made or furnished to Lessor by or on
behalf of Lessee in this  Lease,  any Lease  Schedule or the Charter is false or
misleading in any material respect when made or furnished;

     19.12. Failure of Lessee to maintain in full force and effect the licenses,
permits and certifications that may be required under any applicable gaming laws
for the operation of Lessee 's business;

     19.13. The revocation of any gaming license of Lessee;

     19.14. The denial of any gaming license application of Lessee;

     19.15.  Failure of Lessee to comply with all applicable gaming statutes and
regulations;

     19.16.  Failure  of Lessee  to  maintain  the  insurance  required  by this
Agreement; and/or

     19.17. Any merger, consolidation,  sale, change in control of Lessee (other
than a change in control  resulting  from the death of Frances W. Murray) or any
transfer of a majority of Lessee's  business or assets,  without  Lessor's prior
written consent, such consent not to be unreasonably withheld.

   20. Lessor Remedies.

     20.1.  Lessee  acknowledges  that the  enforcement  of this  Agreement  may
require  approval of certain  regulatory  authorities  and copies of all Default
Notices, legal proceedings,  etc. will be forwarded to the appropriate agency as
required by state law or  regulation.  Lessee further  acknowledges  that if any
Event of Default occurs and is continuing after the expiration of any applicable
cure  period,  Lessor may, in addition to any and all rights and remedies it may
have at law or in  equity,  without  notice to or demand  upon any party to this
Agreement and at its sole option,  terminate this Lease, all Lease Schedules and
the  Charter  and  thereafter,  if Lessor has not  received  notice  from Lessee
pursuant to Section 21.2 of its intent to exercise its option  thereunder or, if
such  notice is received  but Lessee does not  consummate  the  purchase  within
thirty (30) days:

          20.1.1.  Declare all amounts  remaining  unpaid under this  Agreement,
including  without  limitation  the Casualty  Value as defined in Section  21.2,
immediately due and payable and interest shall accrue on any outstanding balance
due Lessor at a rate of 3% per annum, until paid in full;

          20.1.2.  Proceed  by  appropriate  court  action or other  proceeding,
either  at law or in  equity  to  enforce  performance  by Lessee of any and all
covenants of this Agreement;

          20.1.3.  Enter onto Lessee's  premises or the Premises in person or by
agent and take possession of the Equipment;

          20.1.4.  Require Lessee to return the Equipment,  at Lessee's expense,
to a place reasonably designated by Lessor;

          20.1.5.  Render the Equipment unusable in such manner as is reasonable
under the circumstances and as may be allowed by applicable law;

          20.1.6. Dispose of the Equipment in a commercially  reasonable manner,
as Lessor in the good  faith  exercise  of its  discretion  deems  necessary  or
appropriate;


Master Lease Agreement                                                   Page 10
<PAGE>


          20.1.7.  Without demand,  advertisement  or notice of any kind (except
such notice as may be required under Article 9 of the Uniform Commercial Code as
if it were to apply,  and all of which  are,  to the  extent  permitted  by law,
hereby  expressly  waived),  sell,  resell,  lease,  re-lease  or dispose of the
Equipment in any commercially reasonable manner;

          20.1.8. If not already the property of Lessor,  purchase the Equipment
at public sale with credit on any amounts owed;

          20.1.9. If not already the property of Lessor,  purchase the Equipment
at private sale for a price and on such terms as is determined by an independent
appraiser  appointed  by  Lessor  to be the  price  and terms at which a willing
seller would be ready to sell to an able buyer;

          20.1.10.  Proceed  immediately to exercise each and all of the powers,
rights, and privileges reserved or granted to Lessor under this Agreement;

          20.1.11.  Subject to applicable and  appropriate  gaming laws,  rules,
laws and  regulations,  and required  approvals,  take  possession,  sell and/or
re-lease any unit of the Equipment as Lessor may desire,  in its sole discretion
without  demand or notice,  wherever the same may be located,  without any court
order or  pre-taking  hearing,  any and all damages  occasioned by such retaking
being specifically waived herein by Lessee;

          20.1.12.  Take  control  of any and all  proceeds  to which  Lessee is
entitled;

          20.1.13.  Exercise any other remedies  available to a Lessor under the
Uniform Commercial Code, if applicable;

          20.1.14.  Immediately  seek  equitable  relief in a court of competent
jurisdiction  to  enjoin  a  breach  of this  Agreement  where  said  breach  or
threatened breach would cause irreparable harm to Lessor; and/or

          20.1.15.  Exercise any other rights or remedies  provided or available
to Lessor at law or in equity.

     20.2.  Notwithstanding anything to the contrary contained in this Lease and
notwithstanding  that this  transaction  shall  constitute  an operating  lease,
Lessor and Lessee agree that the respective rights,  remedies and obligations of
the parties  following an Event of Default  shall be subject to Article 9 of the
Uniform Commercial Code ("UCC") as in effect in the State of Nevada, the same as
if the Lessor were a secured  party,  even if Article 9 would not  otherwise  be
applicable.  Without  limiting the  generality of the  foregoing,  any public or
private sale,  lease or other  disposition  of the  Equipment  shall comply with
Section 9-610 of the UCC, and  distribution of proceeds of sale,  lease or other
disposition, including without limitation application of surplus proceeds, shall
be in accordance  with Section 9-608 of the UCC.  Lessor further agrees that any
public or private sale, lease or other disposition of the Equipment to any party
other than Lessee shall occur at least  forty-five (45) days after the date such
Event of Default first occurred.

     20.3. With respect to any exercise by Lessor of its right to recover and/or
dispose of the Equipment  under this Lease,  the Charter or any Lease  Schedule,
Lessee acknowledges and agrees as follows:  (i) Lessor shall have no obligation,
subject  to the  requirements  of  commercial  reasonableness,  to  clean-up  or
otherwise prepare the Equipment for disposition, (ii) Lessor may comply with any
applicable  state,  federal,  international  or  maritime  law  requirements  in
connection  with any  disposition  of the  Equipment  and any  actions  taken in
connection  therewith  shall  not be  deemed  to  have  adversely  affected  the
commercial reasonableness of any disposition of such Equipment,  (iii) If Lessor
purchases any of the Equipment at public or private sale, Lessor may pay for the
same by  crediting  some or all of Lessee's  obligations  under this Lease,  the
Charter or any Lease Schedule.

     20.4. No waiver by Lessor,  its affiliates,  successors or assigns,  of any
default,  including,  but not limited to,  acceptance  of late payment after the
same is due,  shall  operate  as a waiver  of any other  default  or of the same
default on a future occasion. In the Event of Default,  Lessor shall be entitled
to recover all costs,  expenses,  losses,  damages  and legal  costs  (including
reasonable attorneys' fees) reasonably incurred by Lessor in connection with the
enforcement  of  Lessor's  remedies.  All  rights  and  remedies  of Lessor  are
cumulative and are in addition to any other  remedies  provided for at law or in
equity,  including the Uniform  Commercial Code, if applicable,  and may, to the
extent permitted by law, be exercised concurrently or separately.  A termination
hereunder  shall  occur  only upon  written  notice  by Lessor to Lessee  and no
repossession  or other act by Lessor after default shall relieve Lessee from any
of its  obligations  to Lessor  hereunder  unless  Lessor so notifies  Lessee in
writing.

     20.5.  In the event of a default  by Lessee,  Lessor  may,  at its  option,
declare this Agreement  terminated  without  further  liability or obligation to
Lessee other than as provided in Section 21.2.

   21. Compliance with Governmental Agencies.


Master Lease Agreement                                                   Page 11
<PAGE>


     21.1. All services  furnished  hereunder shall comply with the requirements
of all governmental  authorities having  jurisdiction (the  "Authorities").  The
terms and  conditions of the Lease,  the Charter or any Lease  Schedule shall be
subject to the  approval by the  Authorities,  if such  approval is so required.
Lessee  agrees to  comply  with all  material  requirements  of all  Authorities
applicable to it or its business.  It is understood  that, if at any time either
prior to or subsequent to the initial starting date of the Lease, the Charter or
any Lease Schedule,  the Authorities shall render a final  determination  either
disapproving  the terms and  conditions  of the Lease,  the Charter or any Lease
Schedule  or denying  the  application  of Lessor for a gaming  license,  vendor
registration or casino service supplier, as a result, directly or indirectly, of
this Lease,  the acts or omissions of Lessee or the identity,  acts or omissions
of persons or entities  affiliated with Lessee,  or if Lessor already has such a
license,  the  qualifications of Lessor that then, in either of such events, the
Lease, the Charter or any Lease Schedule shall be deemed  terminated,  as of the
date of such disapproval or denial, as though such date were the date originally
fixed  herein for the notice of  termination  of the Lease,  the  Charter or any
Lease Schedule.

     21.2. If the Lease, the Charter or any Lease Schedule is terminated for any
reason prior to  expiration of the Term  (including,  without  limitation,  as a
result of an Event of  Default),  then Lessee  shall have the option to purchase
the Equipment by providing  written  notice to Lessor within ten (10) days after
termination  and  tendering  payment  to Lessor  within  thirty  (30) days after
termination  of (i) any amounts then due and owing under the Lease and any lease
schedule,  including but not limited to such items as rent,  late  charges,  and
taxes paid by or assessed upon Lessor, and (ii) the amount equal to the Casualty
Value,  as set forth in the Lease  Schedule,  and Lessor shall transfer title to
the  Equipment  to Lessee and in that  event the  parties  hereto  shall have no
further  liability  to each other.  In the event  Lessee does not  exercise  its
option to purchase the  Equipment in accordance  with this Section 21.2,  Lessor
shall sell the Equipment  within a reasonable  period of time and distribute the
proceeds of such sale in accordance with Article 9 of the UCC.

   22. Waiver of Jury Trial. The parties hereby knowingly and voluntarily  waive
their  right to a jury  trial on any  claim or  cause of  action  based  upon or
arising out of,  directly or  indirectly,  this Lease,  the Charter or any Lease
Schedules,  any  dealings  between  the parties  relating to the subject  matter
hereof or thereof, and/or the relationship that is being established between the
parties.  The scope of this waiver is intended to be all encompassing of any and
all  disputes  that may be filed in any court  (including,  without  limitation,
contract claims,  tort claims,  breach of duty claims,  and all other common law
and statutory  claims).  This waiver may not be modified orally,  and the waiver
shall apply to any subsequent amendment,  renewals,  supplement or modifications
to this Lease. In the event of litigation,  this Lease may be filed as a written
consent to a trial by the court.

   23. Miscellaneous.

     23.1.  Amendments  or  Modifications.  This Lease  shall not be modified or
amended except by an instrument in writing signed by or on behalf of the parties
hereto.

     23.2.  Binding  Effect.  This Lease shall be binding  upon and inure to the
benefit  of the  parties  and their  respective,  permitted  successors,  heirs,
executors,  administrators,  assigns,  and all persons  claiming by,  through or
under them.

     23.3. Captions,  Headings and Titles. The captions,  headings and titles of
the various  sections of this Lease are for  convenience  only and are not to be
construed as confining or limiting in any way the scope or intent of the parties
or the provisions hereof. Whenever the context requires or permits, the singular
shall  include  the  plural,  the plural  shall  include  the  singular  and the
masculine, feminine and neuter shall be freely interchangeable.

     23.4.  Compliance  with All Laws.  Neither  party shall  violate any law or
regulation  including,  without  limitation,  any gaming law or regulation or to
engage in any act or  omission  which tends to bring  discredit  upon the gaming
industry  or  otherwise  jeopardizes  the  other  party's  ability  to engage in
business with businesses licensed by any applicable regulatory authorities. Each
party  shall  use its  good  faith  judgment  in  determining  whether  any such
violation,  act or  omission of the other  party or its  directors,  officers or
managers, if any, places such party's business or licenses at risk and upon such
determination  such party  shall have the right to  immediately  terminate  this
Lease, the Charter or any Lease Schedule without further  liability to the other
party, other than as provided in Section 21.2.

     23.5.  Conduct.  Lessee  acknowledges  that Lessor,  its  subsidiaries  and
affiliates,  have a positive  reputation in the finance and gaming  industry and
that Lessor and its  subsidiaries  and  affiliates are subject to regulation and
licensing  and  desire  to  maintain  their   reputation  and  receive  positive
publicity. Lessee therefore agrees that throughout the Term, Lessee`s directors,
officers and managers will not conduct  themselves in any manner that materially
adversely affects or is detrimental to, Lessor,  its subsidiaries or affiliates,
and will not directly or indirectly make any oral,  written or recorded  private
or public  statement or comment that is  disparaging,  critical or defamatory of
Lessor or its  subsidiaries  or  affiliates.  Lessor  shall  use its good  faith
business  judgment in  determining  whether  the conduct of Lessee`s  directors,
officers or managers  materially  adversely affects Lessor,  its subsidiaries or
affiliates,  and  upon  such  determination  Lessor  shall  have  the  right  to
immediately  terminate this Lease,  the Charter or any Lease  Schedules  without
further liability to Lessee.


Master Lease Agreement                                                   Page 12
<PAGE>


     23.6.  Confidentiality.  Lessor and Lessee and their  respective  employees
shall keep all statistical,  financial,  confidential, and/or personal data with
respect to the other party requested,  received,  developed, stored or viewed by
Lessor or Lessee in connection with this Agreement in the strictest  confidence.
Lessor and Lessee  agree not to divulge to third  parties,  without  the written
consent of the other party, any such information  unless: [i] the information is
known to the disclosing  party prior to obtaining the same; [ii] the information
is,  at the time of  disclosure  by the  disclosing  party,  then in the  public
domain;  [iii] the information is obtained by the disclosing  party from a third
party who did not receive same, directly or indirectly from the disclosing party
and  who has no  obligation  of  secrecy  with  respect  thereto;  or  [iv]  the
disclosing  party is obligated to divulge the  information to a governmental  or
regulatory authority having competent  jurisdiction over the disclosing party or
its business, provided that in such event the disclosing party shall provide the
other  party  with prior  written  notice  and upon the  non-disclosing  party's
request cooperate with such party to prevent such disclosure.

     23.7.  Counterparts.  This Lease may be executed in as many counterparts as
may be deemed necessary and convenient,  and by the different  parties hereto on
separate   counterparts,   each  of  which,   when  so  executed  or   otherwise
authenticated,  shall be deemed  to be an  original,  but all such  counterparts
together shall constitute but one and the same document.

     23.8.  Effective  Only Upon Execution by Authorized  Officer.  Neither this
Lease  nor any Lease  Schedule  shall be  deemed  to  constitute  an offer or be
binding  upon Lessor or Lessee  until  executed by their  respective  authorized
officers.  No representations  made by any Lessor's  salespersons or anyone else
shall be binding unless incorporated herein in writing.

     23.9.  Entire  Agreement.  This Lease,  the Charter,  any Lease  Schedules,
mortgages and related instruments executed in connection  therewith  constitutes
the entire  agreement  between the parties  with  respect to the subject  matter
hereof   and   supersedes   all  prior   agreements,   promises,   negotiations,
representations or understandings,  whether written or oral, between the parties
hereto  relating to the subject  matter of this Lease,  the Charter or any Lease
Schedules.  Any prior agreements,  promises,  negotiations,  representations  or
understandings,  either oral or written,  not expressly set forth in this Lease,
any Lease  Schedule,  or related  instruments  executed in connection  therewith
shall no force or effect.

     23.10.  Further  Assurances.  The parties further covenant and agree to do,
execute and deliver, or cause to be done,  executed and delivered,  and covenant
and agree to use their best efforts to cause their successors and assigns to do,
execute and  deliver,  or cause to be done,  executed  and  delivered,  all such
further acts,  transfers and assurances,  for  implementing the intention of the
parties under this  Agreement,  as the parties  reasonably  shall  request.  The
parties agree to execute any additional  instruments or agreements  necessary to
carry out the intent of this Lease.

     23.11.  Governing Law. The  substantive and procedural laws of the State of
Nevada and  applicable  federal  law shall  govern the  validity,  construction,
interpretation,  performance  and  enforcement of this Agreement and the parties
agree to  jurisdiction  in Nevada  without  reference  to its  conflict  of laws
provisions regardless of the location of the Equipment.  The parties also hereby
agree that any action and/or  proceeding in connection with this Agreement shall
only be brought in the venue of Clark County, Nevada.

     23.12.  Governing Law (Sovereign Nations Only). In the event that Lessee is
an Indian  Tribe as defined  by the  Indian  Gaming  Regulatory  Act,  25 U.S.C.
ss.2701 et seq. or a sovereign  nation,  the  parties  agree that the  immediate
section above shall be null and void and Lessee  hereby grants a limited  waiver
of its  Sovereign  Immunity,  for the sole benefit of Lessor,  such waiver being
limited to  actions or claims by Lessor  against  Lessee,  or by Lessee  against
Lessor, which shall arise directly from, or are related to, this Agreement.  Any
action  brought by or against  Lessor may be brought  only in the United  States
District  Court most near Lessee`s  primary place of business  regardless of the
location of the Equipment.  The law to be applied by said United States District
Court in any such action shall be the law of the State of Nevada,  including the
Uniform Commercial Code, as adopted by the State of Nevada, without reference to
any Nevada choice of law provisions.  Without in any way limiting the generality
of the foregoing,  Lessee expressly  authorizes any governmental or other agency
authorities who have the right and duty under applicable law to take any and all
action  authorized  or  ordered  by any  court,  including  without  limitation,
entering the land of Lessee and  repossessing  the Equipment or otherwise giving
effect to any judgment entered. It is the intent of the parties that Lessor will
be able to obtain  possession  of the  Equipment in  accordance  with the rights
afforded it under applicable laws and/or any court order.

     23.13.  Governmental  Regulations.  Notwithstanding anything in this Lease,
the Charter or any Lease  Schedule to the  contrary,  in the event any  federal,
state, local or other governmental body's statutes,  laws, rules, or regulations
are enacted/promulgated,  the impact of which will materially impact the methods
and/or  costs of Lessor  under this Lease,  the  Charter or any Lease  Schedule,
then,  in that  event,  Lessor,  upon  written  notice to Lessee,  may request a
renegotiation   of  this  Lease,   the  Charter  or  any  Lease  Schedule.   Any
modifications  to this Lease,  the Charter or any Lease Schedule  resulting from
such renegotiation shall become effective on the latest date as permitted by the
governmental  body. In the event the parties are unable to reach a  satisfactory
agreement during said renegotiations,  Lessor shall have the right to cancel the
Lease,  the Charter and all Lease Schedules at any time by not less than 60 days
prior written notice to Lessee, whereupon the Lease, all Lease Schedules and the
Charter  shall be null and void and Lessee  shall have the rights  described  in
Section 21.2.


Master Lease Agreement                                                   Page 13
<PAGE>


     23.14. Independence of Parties. All persons hired or employed by each party
in the discharge of this Lease shall be  considered  employees of that party and
not of any other party to this Lease and shall be solely and  exclusively  under
the hiring or employing party's direction and control.  Neither party nor any of
its employees [i] shall be held or deemed in any way to be an agent, employee or
official of the other party,  or [ii] shall have the authority to bind the other
party in any manner  whatsoever.  Each party further  agrees to have all persons
employed by it properly covered by worker's compensation or employer's liability
insurance,  as  required  by law and to assume and pay at its own cost all taxes
and  contributions  required  by an  employer  under  any and  all  unemployment
insurance,  old age pensions,  and other  applicable  so-called  Social Security
Acts.

     23.15.  Intellectual  Property  Rights not conveyed.  Nothing in this Lease
shall be construed as to grant or convey to Lessee any right,  title or interest
in  and  to  any  intellectual  property  rights  (including  software,  patent,
copyright and/or trademark) to any part of the Equipment.

     23.16.  Lease  Irrevocable.  This  Lease is  irrevocable  for the full Term
hereof and the Rent shall not abate by reason of  termination  of Lessee's right
of  possession  and/or the taking of  possession  by the Lessor or for any other
reason; provided, however, that nothing in this Section 23.16 shall be construed
as limiting  Lessor's  or  Lessee's  right to  terminate  this Lease,  any Lease
Schedule  and/or the Charter  prior to the  expiration of the Term in accordance
with the provisions of this Lease, the Lease Schedules and/or the Charter.

     23.17.  License and  Permits.  Each party shall  obtain and  maintain on an
active and current basis, all licenses,  permits,  registrations,  approvals and
other authority as may be required from any applicable  federal,  state,  tribal
and local  governments and agencies having  jurisdiction over the subject matter
of this Lease and any Lease Schedule.

     23.18.  Multiple Second  Parties.  If more than one Lessee is named in this
Lease or a Lease  Schedule  the  liability  of each shall be joint and  several.
Lessor may bring and prosecute a separate  action against  separate,  individual
Lessees to enforce any one or more Lessees' liability hereunder,  whether or not
any action is brought  against any other  Lessee or any other person and whether
or not any  Lessee or any other  person  is  joined in such  action or  actions.
Nothing shall  prohibit  Lessor from  exercising its rights against any separate
Lessee and any other  person  simultaneously,  jointly  and/or  severally.  Each
Lessee shall be bound by each and every ruling,  order and judgment  obtained by
Lessor  against  any Lessee in respect of the  obligations,  whether or not such
Lessee is a party to the action or  proceeding  in which such  ruling,  order or
judgment is issued or rendered.

     23.19. No Joint Venture,  Partnership or Agency Relationship.  Neither this
Lease nor any Lease  Schedule  shall  create any joint  venture  or  partnership
between the  parties.  Nothing  contained  in this Lease and any Lease  Schedule
shall confer upon either party any  proprietary  interest in, or subject a party
to any liability for or in respect of the business,  assets,  profits, losses or
obligations of the other. Nothing herein contained shall be read or construed so
as to make the parties a  partnership,  nor shall anything  contained  herein be
read or  construed in any way to restrict the freedom of either party to conduct
any  business or activity  whatsoever  without any  accountability  to the other
party. Neither party shall be considered to be an agent or representative of the
other  party  or  have  any  authority  or  power  to act for or  undertake  any
obligation  on behalf of the other party except as expressly  authorized  by the
other party in writing. Any such unauthorized  representation or action shall be
considered a breach of this Lease and any Lease Schedule.

     23.20.  Nondiscrimination.  Neither  party shall  discriminate  against any
person on the basis of race,  color,  sex,  national  origin,  disability,  age,
religion, handicapping condition (including AIDS or AIDS related conditions), or
any other class protected by United States federal law or regulation.

     23.21. Non-Party Beneficiaries.  Nothing herein, whether express or implied
shall be  construed  to give  any  person  other  than the  parties,  and  their
successors and permitted assigns,  any legal or equitable right, remedy of claim
under or in respect of this Lease and any Lease Schedule; but this Lease and any
Lease  Schedule  shall be held to be for the sole and  exclusive  benefit of the
parties, and their successors and assigns.

     23.22.  Notices.  Except as otherwise required by law, all notices required
herein  shall be in writing  and sent by prepaid  certified  mail or by courier,
addressed  to the party at the  address  of the party  specified  herein or such
other address  designated  in writing.  Notices are deemed to have been received
[i] on the fourth  business  day  following  posting  thereof in the U.S.  Mail,
properly  addressed  and postage  prepaid,  [ii] when  received in any medium if
confirmed or receipted for in the manner  customary in the medium  employed,  or
[iii] if  acknowledged in any manner by the party to whom the  communication  is
directed.

     23.23. Privileged Licenses.

          23.23.1.   Lessee   acknowledges  that  Lessor,  its  parent  company,
subsidiaries  and  affiliates,  are businesses that are or may be subject to and
exist because of privileged  licenses  issued by  governmental  authorities.  If
requested  to  do  so  by  Lessor,   Lessee,


Master Lease Agreement                                                   Page 14
<PAGE>

and  its  agents,  employees  and  subcontractors,  shall  obtain  any  license,
qualification,  clearance  or the like which shall be  reasonably  requested  or
required  of  any  of  them  by  Lessor  or  any  regulatory   authority  having
jurisdiction  over Lessor or any parent  company,  subsidiary  or  affiliate  of
Lessor. If Lessee, or its agents, employees, or subcontractors, fails to satisfy
such requirement or if Lessor or any parent company,  subsidiary or affiliate of
Lessor is directed to cease  business  with Lessee or its agents,  employees  or
subcontractors  by  any  such  authority,  or if  Lessor  shall  in  good  faith
determine,  in Lessor's sole and exclusive judgment,  that Lessee, or any of its
agents, employees, subcontractors, or representatives [i] is or might be engaged
in, or is about to be engaged in, any activity or activities,  or [ii] was or is
involved in any relationship,  either of which could or does jeopardize Lessor's
business  or  such  licenses,  or  those  of a  parent  company,  subsidiary  or
affiliate, or if any such license is threatened to be, or is, denied, curtailed,
suspended or revoked,  this Lease,  all Lease  Schedules  and the Charter may be
immediately  terminated by Lessor without further liability to Lessee other than
as provided in Section 21.2.

          23.23.2.  Lessee further  acknowledges  its  understanding  that it is
illegal for a denied gaming license applicant or a revoked gaming licensee, or a
business entity under such a person's control, to enter or attempt to enter into
a contract  with Lessor,  its parent  company,  subsidiaries  or any  affiliate,
without the prior approval of the Nevada Gaming  Commission or other  applicable
gaming  authorities.  Lessee  affirms that it is not such a person or entity and
that it is not under the  control of such a person;  and agrees that this Lease,
all Lease Schedules and the Charter are each subject to immediate termination by
Lessor,  without further liability to Lessee,  other than as provided in Section
21.2, if Lessee is or becomes such a person or entity or is under the control of
such a person.

     23.24.  Pronouns.  Masculine or feminine  pronouns shall be substituted for
the neuter  form and vice versa,  and the plural  shall be  substituted  for the
singular form and vice versa, in any place or places herein in which the context
requires such substitution or substitutions.

     23.25.  Regulatory  Approvals.  Certain  transactions  contemplated by this
Lease and any Lease Schedule may require the approval of governmental regulatory
authorities. Those transactions are entirely conditional upon and subject to the
prior approval of such authority.  If the transactions are not so approved, they
shall be null and void ab initio.  The parties shall  cooperate with one another
and move  promptly  with due diligence and in good faith to request any required
or  appropriate  regulatory  approvals.   If  the  action  or  inaction  of  any
governmental  regulatory  authority renders the parties unable to consummate any
transaction  contemplated  by this Lease and any Lease  Schedule  which  thereby
denies a party a  material  benefit  contemplated  by this  Lease  and any Lease
Schedule  resulting in the unjust  enrichment  of the other  party,  the parties
shall  negotiate in good faith an amendment to this Lease and any Lease Schedule
which fairly compensates the party denied the benefit.

     23.26.  Riders. In the event that any riders are attached hereto and made a
part hereof and if there is a conflict  between the terms and  provisions of any
rider,  including any Lease  Schedule and the terms and provisions  herein,  the
terms and  provisions of the rider or Lease Schedule shall control to the extent
of such conflict.

     23.27. Setoffs. The monies owed by Lessee herein shall be paid in full when
due under the terms of this Lease and any Lease Schedule without right of setoff
of any  monies  owed by Lessor to Lessee  under any other  agreement  or for any
other purpose.

     23.28.  Severability.  Each term, covenant,  condition or provision of this
Lease and any Lease  Schedule  shall be viewed as separate and distinct,  and in
the event that any such term, covenant,  condition or provision shall be held by
a court of competent  jurisdiction to be invalid, the remaining provisions shall
continue in full force and effect.

     23.29.  Suitability.  Lessee  understands and acknowledges that this Lease,
the Charter and any Lease Schedule,  at Lessor's  discretion,  may be subject to
Lessee and its  principals  completing  and submitting to Lessor a due diligence
compliance   questionnaire  (including  an  Authorization  for  the  Release  of
Information)  and  being  found  suitable  by  Lessor's  Compliance   Committee.
Notwithstanding  any other provision in this Lease and any Lease Schedule to the
contrary,  Lessor may terminate  this Lease,  the Charter and any Lease Schedule
without  further  obligation  or  liability  to Lessee  if, in the  judgment  of
Lessor's  Compliance  Committee,  the relationship with Lessee or its principals
could subject  Lessor to  disciplinary  action or cause Lessor to lose or become
unable to obtain or reinstate any federal,  state and/or  foreign  registration,
license or approval  material to Lessor's business or the business of any Lessor
subsidiary.

     23.30. Survival of Indemnities. All indemnities of Lessee shall survive and
continue  in full force and effect for events  occurring  prior to the return of
the Equipment to the Lessor,  notwithstanding  the  expiration or termination of
the Term.

     23.31. Time Periods. In the event the provisions of this Lease, the Charter
or any Lease Schedule  require any act to be done or to be taken  hereunder on a
date which is a Saturday,  Sunday or legal holiday,  such act or action shall be
deemed to have been  validly done or taken on the next  succeeding  day which is
not a Saturday, Sunday or legal holiday.


Master Lease Agreement                                                   Page 15
<PAGE>


     23.32.  Waiver.  The  failure  of any party to  insist,  in any one or more
instances,  upon performance of any of the provisions of this Lease, the Charter
or any Lease Schedule or to take advantage of any of its rights  hereunder shall
not  operate as a waiver  thereof  or  preclude  any other or  further  exercise
thereof or the exercise of any other right or power. Accordingly, the acceptance
of rent by  Lessor  after it is due  shall  not be  deemed to be a waiver of any
breach by Lessee of its obligations  under this Lease,  the Charter or any Lease
Schedule.

     IN WITNESS  WHEREOF,  the parties  have caused  this  Agreement  to be duly
executed as of the date set forth above.

LESSEE:                                 LESSOR:

PALM BEACH EMPRESS, INC.,               CRUISE HOLDINGS II, LLC,
a Delaware corporation                  a Nevada limited liability company


By:/S/Francis W. Murray                 By:/s/Peter D. Cleary
Name: Francis W. Murray                 Name: Peter D. Cleary
Its:  President                         Its:  President

LESSEE:

PALM BEACH MARITIME CORPORATION,
formerly named MJQ CORPORATION,
a Delaware corporation


By:/S/Francis X. Murray
Name: Francis X. Murray
Its:  President


Master Lease Agreement                                                   Page 16
<PAGE>



                                                Transaction No. 1192-L01-01


                              LEASE SCHEDULE NO. 1
                                  (EMPRESS II)
                                 (With Options)

     THIS LEASE  SCHEDULE NO. 1 (EMPRESS II) ("Lease  Schedule")  is attached to
and made a part of the Master Lease  Agreement  ("Lease") of even date  herewith
between  CRUISE  HOLDINGS  II,  LLC, a Nevada  limited  liability  company,  its
successors  and assigns  ("Lessor"),  and PALM BEACH  EMPRESS,  INC., a Delaware
corporation  ("PBE") and PALM BEACH  MARITIME  CORPORATION,  formerly  named MJQ
CORPORATION,  a Delaware corporation ("MJQ"), jointly and severally (PBE and MJQ
are hereinafter collectively referred to as, the ("Lessee").


   1. Definitions. Terms not otherwise defined in this Lease Schedule shall have
the meaning attributed to such terms in the Lease.

   2.  Description of Equipment.  The equipment listed on Attachment "A" to this
Lease  Schedule is added to the equipment  leased under the Lease  consisting of
the Empress II Casino Cruise Ship Vessel (Coast Guard No. 998517) (collectively,
the  "Equipment")  and  made  subject  to  the  provisions  of  the  Lease.  The
capitalized  cost of the  Equipment  is  $6,000,000.00  ("Capitalized  Equipment
Cost").

   3.  Commencement  Date. The Commencement  Date for the Equipment leased under
this Lease Schedule shall be the Acceptance Date set forth in the Certificate of
Delivery  and  Acceptance  executed  by Lessee  in  connection  with this  Lease
Schedule.

   4. Term. The Term shall commence on the Commencement  Date and shall continue
for sixty (60) consecutive  months. This Lease Schedule shall be non-cancelable,
except upon prepayment permitted under the Charter, for the duration of the Term
or any Renewal Term (defined below).

   5. Basic Rent And  Payments.  The Basic  Rent  ("Basic  Rent") due each month
during the Term for the  Equipment  shall be the  Charter  Hire due and  payable
under the  Charter,  and  payment of the  Charter  Hire in  accordance  with the
Charter shall constitute payment of the Basic Rent hereunder.

   6. Fees And Charges.

     a.  Origination  and  Documentation  Fee.  Lessee  agrees  to pay to Lessor
Origination and Documentation Fees as set forth in the Lease.

     b. Closing Fee. Lessee agrees to pay to Lessor a Closing Fee for this Lease
Schedule  in an  amount  equal  to  two  and  one-half  percent  (2.5%)  of  the
Capitalized Equipment Cost, or $150,000.00.

     c.  Imposts.  In addition to the monthly Basic Rent due as set forth above,
Lessee agrees to pay and indemnify Lessor for, and hold Lessor harmless from and
against all taxes, assessments,  fees and charges (hereinafter called "Imposts")
together with any penalties, fines or interest thereon levied and imposed by any
governmental  agency or unit  (state,  local,  federal,  domestic or foreign) in
accordance with the terms of the Charter.

   7. Security Deposit.  Due and payable on the Commencement  Date, Lessee shall
pay to Lessor, a Security Deposit in an amount equal to Eighty-Two  Thousand Six
Hundred Ninety-Five Dollars (US$82,695.00). The Security Deposit will be held by
the Lessor for the Term of the Lease and will be, at Lessor's  sole  discretion,
either (i)  returned to Lessee  upon  satisfactory  completion  of the terms and
conditions  of the  Lease;  or (ii) if Lessee is not in  default  under the Term
(initial  and/or  renewed,  if applicable) of the Lease or this Lease  Schedule,
applied to Lessee's final payment of Basic Rent.

   8.  Residual  Cash Flow  Sweep.  Lessee  shall make an annual cash flow sweep
("Cash Flow Sweep") payment in accordance with, and with the effect provided in,
the Charter.  Lessor and Lessee  acknowledge  and agree that the Lease will be a
capital lease.

   9. Cash Flow Sweep  Account.  At the end of each  quarter of the each  fiscal
year,  Lessee shall (if required by the  Charter)  deposit a certain  portion of
year to date EBITDA into an account  for the  benefit of Lessor,  in  accordance
with the Charter.

   10.  Casualty Value.  After the conclusion of the thirteenth  (13th) month of
the  Term or at any  time  upon an  actual  or  constructive  total  loss of the
Equipment  during the Term,  Lessee may prepay any  amounts or  obligations  due
under the Lease or this Lease Schedule (the "Casualty Value") in accordance with
the Casualty  Value  Schedule,  attached  hereto as Schedule  A.1.

Lease Schedule                                                            Page 1
<PAGE>

  Lessee shall
submit,  at  Lessee's  option,  the full  pre-payment  amount  to  Lessor on the
fifteenth  (15th)  day  of the  month;  provided,  however,  Lessee  shall  have
previously made such month's Basic Rent payment in accordance with the Lease and
this Lease Schedule.

   11. Options and Notice.

     a. Lessor grants Lessee the following option(s):

          (i) Purchase Option:  Upon any termination of the Lease (including any
termination  thereof  caused by the default of Lessee),  Lessee may purchase all
but not less than all of the Equipment  described in the Lease  Schedule for the
applicable  Casualty  Value  in  accordance  with  the  Charter  (the  "Purchase
Option"). In addition,  upon reduction of the Casualty Value to zero and payment
of all sums  owing  under the  Master  Lease and the  Charter,  Lessee  shall be
deemed, without further action, to have exercised the Purchase Option and Lessor
shall convey to Lessee title to the  Equipment in  accordance  with the terms of
the Charter.

          (ii) Option to Return Equipment: At the expiration of the Term, Lessee
may return the Equipment to Lessor in  accordance  with the Charter (the "Return
Option").

     b. Lessee acknowledges that the Equipment sold by Lessor under the Purchase
Option is being  sold in an "as is,  where is"  condition.  Except as  otherwise
provided  in  Article  19 of the  Charter,  Lessor  makes,  and  will  make,  no
representations  or warranties  regarding the  Equipment,  its  suitability  for
Lessee's  purpose,  or its compliance  with any laws.  Lessee hereby assumes all
liability for the Equipment and agrees to indemnify  Lessor per the terms of the
Lease and the Charter.

   12. UCC  Filings.  Lessee  hereby  ratifies  any and all UCC-1  and/or  UCC-3
statements  and/or  amendments  thereto  related to this Lease  Schedule  or the
Equipment  previously filed by Lessor and authorizes  Lessor to file any and all
UCC-1 and/or UCC-3 statements  and/or  amendments  thereto related to this Lease
Schedule  or the  Equipment,  without  Lessee's  authentication,  to the  extent
permitted by applicable law.

   13. Intentionally Omitted.

   14.  Incorporation  of Lease and Charter.  All of the provisions of the Lease
and Charter are  incorporated by reference  herein as if set forth fully herein.
In the event of any conflict  between the terms and  conditions of this Schedule
and the terms and  conditions of either the Lease or the Charter,  the terms and
provisions of the Lease or the Charter shall control.


                         [SIGNATURES ON FOLLOWING PAGE]


Lease Schedule                                                            Page 2
<PAGE>



Dated this 6th day of July, 2004.

LESSEE:                                     LESSOR:

PALM BEACH EMPRESS,                         CRUISE HOLDINGS I, LLC,
a Delaware corporation                      a Nevada limited liability
                                            company


By:/S/Francis W. Murray                     By:/s/Peter D. Cleary
Name: Francis W. Murray                     Name: Peter D. Cleary
Its:  President                             Its:  President

LESSEE:

PALM BEACH MARITIME CORPORATION,
formerly named MJQ CORPORATION,
a Delaware corporation


By:/S/Francis X. Murray
Name: Francis X. Murray
Its:  President




Lease Schedule                                                            Page 3
<PAGE>


                                  ATTACHMENT A
                                   EMPRESS II

The EMPRESS II is the Ship and General  Improvement at an on the maritime vessel
named the EMPRESS II Casino Cruise Ship (United States  Official  Number 998517.
General  Improvements  shall mean all  equipment  and FF&E as defined in Section
1250 of the United States Internal  Revenue Service  Publication  946, where the
equipment  and FF&E is considered a structural  component or critical  operating
component of the vessel.


Lease Schedule                                                            Page 4
<PAGE>



-------------------------------------------------------------------------
                             SCHEDULE A-1
                        CASUALTY VALUE SCHEDULE
                              Empress II
-------------------------------------------------------------------------
 Month       Principal                Premium      Total Casualty Payment
 ------ ------------------- ----- ---------------- ----------------------
   13     5,910,992.46       7%      413,769.47      6,324,761.93
 ------ ------------------- ----- ---------------- ----------------------
   14     5,820,758.18       7%      407,453.07      6,228,211.25
 ------ ------------------- ----- ---------------- ----------------------
   15     5,729,280.24       7%      401,049.62      6,130,329.86
 ------ ------------------- ----- ---------------- ----------------------
   16     5,636,541.51       7%      394,557.91      6,031,099.42
 ------ ------------------- ----- ---------------- ----------------------
   17     5,542,524.61       7%      387,976.72      5,930,501.33
 ------ ------------------- ----- ---------------- ----------------------
   18     5,447,211.92       7%      381,304.83      5,828,516.75
 ------ ------------------- ----- ---------------- ----------------------
   19     5,350,585.58       7%      374,540.99      5,725,126.57
 ------ ------------------- ----- ---------------- ----------------------
   20     5,252,627.49       7%      367,683.92      5,620,311.41
 ------ ------------------- ----- ---------------- ----------------------
   21     5,153,319.29       7%      360,732.35      5,514,051.64
 ------ ------------------- ----- ---------------- ----------------------
   22     5,052,642.37       7%      353,684.97      5,406,327.34
 ------ ------------------- ----- ---------------- ----------------------
   23     4,950,577.88       7%      346,540.45      5,297,118.33
 ------ ------------------- ----- ---------------- ----------------------
   24     4,847,106.68       7%      339,297.47      5,186,404.15
 ------ ------------------- ----- ---------------- ----------------------
   25     4,742,209.39       5%      237,110.47      4,979,319.86
 ------ ------------------- ----- ---------------- ----------------------
   26     4,635,866.35       5%      231,793.32      4,867,659.67
 ------ ------------------- ----- ---------------- ----------------------
   27     4,528,057.64       5%      226,402.88      4,754,460.52
 ------ ------------------- ----- ---------------- ----------------------
   28     4,418,763.06       5%      220,938.15      4,639,701.21
 ------ ------------------- ----- ---------------- ----------------------
   29     4,307,962.12       5%      215,398.11      4,523,360.23
 ------ ------------------- ----- ---------------- ----------------------
   30     4,195,634.07       5%      209,781.70      4,405,415.77
 ------ ------------------- ----- ---------------- ----------------------
   31     4,081,757.86       5%      204,087.89      4,285,845.75
 ------ ------------------- ----- ---------------- ----------------------
   32     3,966,312.15       5%      198,315.61      4,164,627.76
 ------ ------------------- ----- ---------------- ----------------------
   33     3,849,275.31       5%      192,463.77      4,041,739.08
 ------ ------------------- ----- ---------------- ----------------------
   34     3,730,625.41       5%      186,531.27      3,917,156.68
 ------ ------------------- ----- ---------------- ----------------------
   35     3,610,340.22       5%      180,517.01      3,790,857.23
 ------ ------------------- ----- ---------------- ----------------------
   36     3,488,397.20       5%      174,419.86      3,662,817.06
 ------ ------------------- ----- ---------------- ----------------------
   37     3,364,773.50       5%      168,238.68      3,533,012.18
 ------ ------------------- ----- ---------------- ----------------------
   38     3,239,445.95       5%      161,972.30      3,401,418.25
 ------ ------------------- ----- ---------------- ----------------------
   39     3,112,391.07       5%      155,619.55      3,268,010.62
 ------ ------------------- ----- ---------------- ----------------------
   40     2,983,585.06       5%      149,179.25      3,132,764.31
 ------ ------------------- ----- ---------------- ----------------------
   41     2,853,003.78       5%      142,650.19      2,995,653.97
 ------ ------------------- ----- ---------------- ----------------------
   42     2,720,622.77       5%      136,031.14      2,856,653.91
 ------ ------------------- ----- ---------------- ----------------------
   43     2,586,417.21       5%      129,320.86      2,715,738.07
 ------ ------------------- ----- ---------------- ----------------------
   44     2,450,361.97       5%      122,518.10      2,572,880.07
 ------ ------------------- ----- ---------------- ----------------------
   45     2,312,431.54       5%      115,621.58      2,428,053.12
 ------ ------------------- ----- ---------------- ----------------------
   46     2,172,600.09       5%      108,630.00      2,281,230.09
 ------ ------------------- ----- ---------------- ----------------------
   47     2,030,841.41       5%      101,542.07      2,132,383.48
 ------ ------------------- ----- ---------------- ----------------------
   48     1,887,128.94       5%       94,356.45      1,981,485.39
 ------ ------------------- ----- ---------------- ----------------------
   49     1,741,435.76       0%              -       1,741,435.76
 ------ ------------------- ----- ---------------- ----------------------
   50     1,593,734.56       0%              -       1,593,734.56
 ------ ------------------- ----- ---------------- ----------------------
   51     1,443,997.67       0%              -       1,443,997.67
 ------ ------------------- ----- ---------------- ----------------------
   52     1,292,197.03       0%              -       1,292,197.03
 ------ ------------------- ----- ---------------- ----------------------
   53     1,138,304.20       0%              -       1,138,304.20
 ------ ------------------- ----- ---------------- ----------------------
   54       982,290.34       0%              -         982,290.34
 ------ ------------------- ----- ---------------- ----------------------
   55       824,126.22       0%              -         824,126.22
 ------ ------------------- ----- ---------------- ----------------------
   56       663,782.20       0%              -         663,782.20
 ------ ------------------- ----- ---------------- ----------------------


Lease Schedule                                                            Page 5
<PAGE>

 ------ ------------------- ----- ----------------------------------------
   57       501,228.24       0%              -         501,228.24
 ------ ------------------- ----- ---------------- ----------------------
   58       336,433.88       0%              -         336,433.88
 ------ ------------------- ----- ---------------- ----------------------
   59       169,368.24       0%              -         169,368.24
 ------ ------------------- ----- ---------------- ----------------------
   60               -        0%              -                 -
 ------ ------------------- ----- ---------------- ----------------------



Lease Schedule                                                            Page 6

</TEXT>
</DOCUMENT>
