ENVIRONMENTAL INDEMNITY

ENVIRONMENTAL INDEMNITY

(Riviera Black Hawk Casino in Black Hawk, Colorado)

This ENVIRONMENTAL INDEMNITY (as amended, modified or otherwise

supplemented from time to time, this "Indemnity") is made and entered into as of

June 8, 2007, by and among RIVIERA HOLDINGS CORPORATION, a Nevada corporation

("RHC") and RIVIERA BLACK HAWK, INC., a Colorado corporation ("RBH"), as

indemnitors (RHC and RBH collectively referred to as "Indemnitors"), and

WACHOVIA BANK, NATIONAL ASSOCIATION, as administrative agent (the "Agent") for

the benefit of the Lenders referred to below.

RECITALS

A. RBH is a wholly-owned subsidiary of RHC and RBH is the

present owner of the real property located in Black Hawk, Colorado included in

the Collateral and more particularly described on Exhibit A (the "Trust

Property").

B. RHC, RBH, and the Agent are, contemporaneously with the

execution and delivery of this Indemnity, entering into that certain Credit

Agreement, dated as of substantially even date herewith (as amended, restated,

supplemented, or otherwise modified from time to time, the "Credit Agreement"),

by and among RHC (the "Borrower"), the subsidiaries of the Borrower from time to

time party thereto, the lenders from time to time party thereto (individually, a

"Lender" and collectively, the "Lenders"), and Wachovia Bank, National

Association, as administrative agent. As used herein and in the Credit

Agreement, the term "Lenders" means, individually and collectively, the Agent

and the Lenders.

C. The Credit Agreement and the Credit Party Obligations are

secured, in part, by RBH's interest in the Trust Property. The Trust Property is

secured by that certain Deed of Trust, Assignment of Leases and Rents, Security

Agreement and Fixture Filing, between RBH and the Agent (for the benefit of the

Lenders), dated as of the date hereof (as the same may be amended, restated,

supplemented, or otherwise modified from time to time, the "Deed of Trust").

D. The Lenders have required, as a condition precedent to

entering into the Credit Agreement, that Indemnitors shall have executed and

delivered this Indemnity in favor of the Agent for the benefit of the Lenders.

NOW, THEREFORE, the parties hereto agree as follows:

1. Recitals. The Recitals are incorporated herein by this reference.

2. Definitions. Capitalized terms used herein but not otherwise defined

shall have the meanings assigned to such terms in the Credit Agreement. For

purposes of this Indemnity, the following terms have the meanings set forth

below.

"Adjacent Property" means any property so situated as to pose

a risk that a Hazardous Material could spread onto the Trust Property.

"Environmental Laws" collectively means and includes any

and all applicable present and, other than with respect to Section 3, future

local, state and federal law relating to the environment and environmental

conditions, including, without limitation, the Colorado Air Quality Control Act,

Colo. Rev. Stat. ss.ss. 25-7-101 et seq.; the Colorado Water Quality Control

Act, Colo. Rev. Stat. ss.ss. 25-8-l01 et seq.; the Hazardous Waste Statute,

Colo. Rev. Stat. ss.ss. 25-15-101 et seq.; the Hazardous Waste Sites Cleanup

Statute, Colo. Rev. Stat. ss.ss. 25-16-101 et. seq.; the Petroleum Storage Tank

Statute, Colo. Rev. Stat. ss.ss. 8-20.5-101 et seq.; the Radiation Control Act,

Colo. Rev. Stat. ss.ss. 25-11-101 et seq.; the Colorado Hazardous Substance

Incidents Statute, Colo., Rev. Stat ss.ss. 29-22-101 et seq..; the Colorado

Hazardous Substances Act of 1973, Colo. Rev. Stat. ss.ss. 25-5-501 et seq.; the

Resource Conservation and Recovery Act of 1976 ("RCRA"), 42 U .S.C. ss. 6901 et

seq.; the Comprehensive Environmental Response, Compensation and Liability

Act of 1980 ("CERCLA"), 42 U.S.C. ss.ss. 9601-9657, as amended by the

Superfund Amendments and Reauthorization Act of 1986 ("SARA"), the Hazardous

Materials Transportation Act, 49 U.S.C. ss. 6901, et seq.; the Federal

Water Pollution Control Act, 33 U.S.C. ss.ss. 1251 et seq.; the Clean Air Act,

42 U.S.C. ss.ss. 741 et seq.; the Clean Water Act, 33 U.S.C. ss. 7401 et seq.;

the Toxic Substances Control Act, 15 U.S.C. ss.ss. 2601-2629, the Safe Drinking

Water Act, 42 U S C. ss.ss. 300f-300j, or any other similar federal, state or

local law of similar effect, each as amended, and any and all regulations,

orders, and decrees now or hereafter promulgated thereunder or any and all

common law requirements, rules and bases of liability regulating, relating to or

imposing liability or standards of conduct concerning pollution or protection of

human health or the environment, as now or may at any time hereafter be in

effect.

"Hazardous Materials" means any substance, material or waste

that is or becomes designated or regulated as "toxic", "hazardous", "pollutant",

or "contaminant" or a similar designation or regulation under any Environmental

Law or other federal, state or local law (whether under common law, statute,

regulation or otherwise) or judicial or administrative interpretation of such,

including, without limitation, asbestos, petroleum products or by-products

(including, without limitation, crude oil or any fraction thereof), the group of

organic compounds known as polychlorinated biphenyls, radon gas, natural gas,

urea formaldehyde, radioactive materials, toxic, infectious, reactive,

corrosive, ignitable or flammable chemicals and chemicals known to cause cancer

or adverse health effects.

"Premises" means the Trust Property, and all improvements now

or hereafter located thereon, and all rights and interests of RBH therein.

"Remedial Work" means any investigation, site monitoring,

containment, cleanup, removal, restoration or other remedial work of any kind or

nature reasonably necessary under any applicable, local, state or federal law or

regulation, any judicial order, or by any governmental or nongovernmental entity

or person because of, or in connection with, the current or future presence,

suspected presence, release or suspected release of Hazardous Materials in or

into the air, soil, groundwater, surface water or soil vapor at, on, about,

under or within the Premises (or any portion thereof).

3. Representations and Warranties. Except as would not constitute a

Material Adverse Effect, each of the Indemnitors represents and warrants that:

(1) no Hazardous Material has been installed, used, generated, manufactured,

treated, handled, refined, produced, processed, stored or disposed of in, on or

under the Trust Property, including, without limitation, the surface and

subsurface waters of the Trust Property, except in compliance in all material

respects with Environmental Laws; (2) no activity has been undertaken on the

Trust Property by Indemnitors, their respective agents, employees, contractors,

licensees, guests or tenants or to their knowledge any other Person, which would

cause, or has caused, (i) the Trust Property to become a hazardous waste

treatment, storage or disposal facility, as such terms are defined and

classified under any currently effective Environmental Law, (ii) a release or

threatened release of Hazardous Materials on, under, about or from the Trust

Property within the meaning of, or otherwise violate, any currently effective

Environmental Law (except as expressly permitted in writing by a Governmental

Authority), or (iii) the discharge or emission of Hazardous Materials which

would require a permit under any currently effective Environmental Law that has

not been obtained and is in full force and effect; (3) no conditions caused by

Indemnitors, their respective agents, employees, contractors, licensees, guests

or tenants or, to their knowledge, any other Person, with respect to the Trust

Property cause a violation or support a claim under any currently effective

Environmental Law; (4) to the best of Indemnitors' knowledge after due inquiry,

no underground storage tanks are located on the Trust Property or have been

located on the Trust Property and subsequently removed or filled; (5) with

respect to the Trust Property, Indemnitors have not received any notice at any

time that it (or any of their tenants or guests) is or was claimed to be in

violation of or in non-compliance with the conditions of any currently effective

Environmental Law; and (6) there is not now pending or threatened any action,

judgment, claim, consent decree, judicial or administrative orders or

agreements, or governmental liens with respect to Indemnitors or the Trust

Property relating to any currently effective Environmental Law.

4. Covenants. Each of the Indemnitors covenants: (i) that no Hazardous

Materials shall be installed, used, generated, manufactured, treated, handled,

refined, produced, processed, stored or disposed of in, on or under the Trust

Property, except in all material respects in compliance with all applicable

rules, regulations and laws; (ii) that no activity shall be undertaken on the

Trust Property which would cause (A) the Trust Property to become a hazardous

waste treatment, storage or disposal facility, as such terms are defined and

classified under any Environmental Law, (B) a release or threatened release of

Hazardous Materials on, under, about or from the Trust Property within the

meaning of, or otherwise violate, any Environmental Law (except as expressly

permitted in writing by a governmental authority), or (C) the discharge or

emission of Hazardous Materials into any watercourse, body of surface or

subsurface water or wetland, or the discharge into the atmosphere of any

Hazardous Materials, that would require a permit under any Environmental Law and

for which no such permit has been issued; (iii) that no activity shall be

undertaken or permitted to be undertaken by Indemnitors on the Trust Property

which would reasonably be expected to result in a violation under any

Environmental Law; (iv) that soils excavated during construction and groundwater

generated during dewatering activities on the Trust Property shall be handled

and disposed of in compliance with Environmental Laws in all material respects;

(v) that if any Remedial Work is required under any applicable Environmental

Laws because of or in connection with current or future presence, suspected

presence, release or suspected release of a Hazardous Material into the air,

soil, ground water, surface water, or soil vapor on, under or about the Premises

or any portion thereof, Indemnitors shall promptly commence and diligently

prosecute to completion all such Remedial Work; provided that the Remedial Work

shall have been approved by any environmental regulatory agency having

jurisdiction over such work; (vi) all Remedial Work shall be performed by

contractors, and under the supervision of a consulting engineer, each approved

in advance by the Agent and any necessary environmental regulatory agencies and

all costs and expenses of such Remedial Work and Agent's or its agents' or

representatives' monitoring or review of such Remedial Work (including

reasonable attorneys' fees, charges and disbursements) shall be paid by

Indemnitors; (vii) if Indemnitors do not timely commence and diligently

prosecute to completion the Remedial Work, Agent and its agents and

representatives may (but shall not be obligated to) cause such Remedial Work to

be performed and Indemnitors agree to bear and shall pay or reimburse Agent (for

the benefit of the Lenders) on demand for all expenses (including reasonable

attorneys' fees, charges and disbursements) relating to or incurred by Agent

(for the benefit of the Lenders) and its agents and representatives in

connection with monitoring, reviewing or performing any Remedial Work; (viii)

Indemnitors shall not commence any Remedial Work or enter into any settlement

agreement, consent decree or other compromise relating to any Hazardous

Materials or Environmental Laws which might impair the value of the Lenders'

security hereunder or under the other Credit Documents, unless such Remedial

Work is required to be performed by an environmental regulatory agency under

applicable law in which case Indemnitors shall use their best efforts not to

impair the value of the Lenders' security under the Credit Documents; and (ix)

promptly following completion of any remedial actions imposed upon Indemnitors

under any Environmental Law by a governmental agency in response to a violation

of Environmental Laws or any environmental permits, licenses, approvals or

authorizations or a release of Hazardous Materials at or from the Trust

Property, Indemnitors shall obtain and deliver to the Agent (for the benefit of

the Lenders), either (x) an environmental report in form and substance

reasonably acceptable to the Agent from an environmental consultant reasonably

acceptable to the Agent, stating that all required action has been taken, and

that upon completion of such action, the Trust Property is, to the knowledge of

such professional, then in compliance with applicable Environmental Laws, or (y)

a statement from the governmental agency that required such action to the effect

that all required action has been taken to its satisfaction.

5. Indemnities. Indemnitors hereby agree to unconditionally indemnify,

defend, and hold the Lenders harmless against: (1) any loss, fines, penalties,

actions, suits, proceedings, liability, damage, expense or claim incurred in

connection with, arising out of, resulting from or incident to the application

of any Environmental Law with respect to the Trust Property; (2) any breach of

any representation or warranty or the inaccuracy of any representation made by

Indemnitors in or pursuant to this Indemnity; (3) any breach of any covenant or

agreement made by Indemnitors in or pursuant to this Indemnity; (4) any

liability or obligation arising out of CERCLA, any equivalent state statute or

any other Environmental Law which may be incurred or asserted against the

Lenders, directly or indirectly, under Environmental Laws, with respect to the

Trust Property; and (5) any other loss, liability, damage, expense or claim

which may be incurred by or asserted against the Lenders, directly or

indirectly, resulting from the presence of Hazardous Material on the Trust

Property, including (A) all foreseeable and unforeseeable consequential damages,

(B) the costs of any required or necessary investigation, repair, cleanup,

remediation or detoxification and (C) the costs of the preparation and

implementation of any closure, remedial or other remedial plans. Notwithstanding

anything herein to the contrary, this Indemnity shall not be construed to impose

liability on Indemnitors for Hazardous Materials placed, released or disposed of

on the Trust Property or any obligation or liability under Environmental Law

(except to the extent caused by the acts or omissions of Indemnitors or their

respective agents, employees, contractors, licensees, guests and tenants) (i)

after the date of foreclosure, assignment (other than an assignment by the Agent

to a