FORBEARANCE AGREEMENT

Exhibit 10.01

FORBEARANCE AGREEMENT

THIS FORBEARANCE AGREEMENT (“Agreement”) is made this 29th day of December, 2004, between Full House Resorts, Inc., (“Company”) and RAM Entertainment, LLC (“Lender”).

RECITALS:

A. On or about February 15, 2002, pursuant to an Investor Agreement, by and between Lender and Company (as amended to date, the “Investor Agreement”), Lender agreed to provide the Company with a loan of $2,381,260.00 (the “Loan”).

B. The Loan is evidenced by a secured Promissory Note, dated February 15, 2002, which Promissory Note was replaced by a Secured Promissory Note, dated February 15, 2003 (the “Note”), in the principal sum of $2,381,260.00, executed by the Company in favor of Lender.

C. The Note is secured by (i) that certain Third Party Security Agreement, of even date therewith, by Company, as borrower, and Lender, as the secured party, thereunder (“Security Agreement”) The Note and Security Agreement, together with all other documents and instruments executed and delivered in connection with the Loan, are collectively referred to herein as the “Loan Documents.”

E. The Loan, subject to the Lender’s right to extend the maturity date, matured on November 15, 2004, and has not been paid, nor has demand for payment been made.

F. Lender and Company desire to resolve certain issues and disputes between them and, in furtherance thereof, enter into this Forbearance Agreement.

NOW, THEREFORE, in consideration of the Recitals, the terms, covenants and conditions set forth in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. Incorporation of Recitals. The Recitals are incorporated herein by reference and are and shall be deemed to be a part of this Agreement as if fully set forth herein.

2. Acknowledgments. The Company acknowledges that:

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3. Forbearance Termination Date. For purposes of this Agreement, “Forbearance Termination Date” shall mean the date that is sixty days after the date hereof, or such later date as the parties hereto may subsequently agree in writing.

4. Lender Obligations. So long as Company performs its obligations hereunder, until the Forbearance Termination Date, Lender will forbear from exercising its remedies or declaring a default under: (a) the Loan Documents; (b) the Investor Agreement; or (c) under the Amended and Restated Limited Liability Company Agreement of Gaming Entertainment (Michigan), L.L.C. (the “Operating Agreement”), in each of the above cases, based on any existing default by Company.

5. Company Obligations. So long as Lender performs its obligations hereunder, until the Forbearance Termination Date, Company will not: (a) take any action under the Investor Agreement that would result in the termination of Lender’s equity interest in Gaming Entertainment (Michigan), L.L.C. (“GEM”), acquired pursuant to the Investor Agreement; (b) assert that Lender’s equity interest in GEM is forfeit or terminate; (c) declare a default under the Investor Agreement or the Operating Agreement; or (d) exercise any remedies under the Operating Agreement or the Investor Agreement, in each of the above cases, based on any existing default by Lender (if any).

6. Mutual Obligations. Until the Forbearance Termination Date, the parties hereto shall negotiate in good faith to resolve any and all existing disputes between them that are the subject of or related to the Investor Agreement, the Loan Documents or the Operating Agreement.