Caleb Francis Allen, 31, has been in custody bail refused for almost 11 months, after a drug deal escalated into a group of people taking two women hostage, and threating they would "get their heads jumped on" after a man took money and disappeared.

According to court documents, Allen and a co-accused organised to purchase drugs through a woman's friend, sometime in the early hours of May 13 last year.

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Police said Allen gave the man $2000 to purchase illicit drugs on their behalf, however left with the money and never returned, ignoring Allen's calls.

Unable to locate the man, Allen and the co-accused sought help from two other people to get the money back.

Allen and the group attended the home of the woman who initially helped sort out the deal. The woman was dragged out of her home as one of the co-accused yelled at her saying they were taking her to help find the man.

The woman was forced into the back of a blue vehicle along with the group, and seated between two of the co-accused.

Allen, who was in the front passenger seat, turned to the victim and screamed "where is he?", before the victim told them he was at the Homestead Motel.

The group attended the hotel and began banging on the door and window of one of the rooms threatening to hurt the woman if the man didn't come out.

Allen was brandishing a red samurai sword.

With no answer, Allen remained at the hotel while the co-accused went to get help from another two men.

When they returned Allen was still yelling for the man to open the door. A female eventually opened the door and the group forced their way in to search for the man, turning over the bed and ransacking the room.

The second woman was told she was coming with them, before driving back to the first victim's home.

While Allen remained in the vehicle, two of the co-accused led the first victim back to her home before ransacking it. Another co-accused took hold of the second woman so she could not escape.

The two co-accused ransacked the victim's bedroom locating $450 cash in the victim's bag which they took before leaving.

Allen began driving the group toward the hotel before the police arrived. The victim was told "don't tell them anything" and to tell officers "we are taking you for a drive".

Officers approached the vehicle and observed a large sword in the front passenger seat, before telling all passengers to exit the vehicle. Following further searches of the car, police also located an axe next to the sword in the passenger seat.

The victim began crying and told police what had happened. Everyone was arrested and taken to Dubbo Police Station.

According to police each of the co-accused indicate they were present during the incident, however dispute their level of involvement. Allen specifically concedes he was in possession of an axe.

In Dubbo Local Court on Tuesday Allen pleaded guilty to one count of being armed with the intent to commit a serious offence, one count of stalk or intimidation to intend fear and physical harm, and one count of enter a building with intention to commit an indictable offence.

Defence solicitor Anne Hazelton said while his record didn't assist him, the incident escalated due to the loss of his money.

She argued Allen had good family support, and was "determined not to go back into custody".

"He's had problems with drug use in the past,' she said.

"I've spoken to his mother, grandmother, and I'm aware his grandfather has a tree lopping business and has work available for him."

Magistrate Theresa Hamilton said it was a very serious and protracted incident, which involved a number of people.

She also told the court Allen had been convicted for similar assault offences in 2012 and 2013.

Taking into account Allen's early plea of guilt and the fact he had been in custody since May last year, Magistrate Hamilton sentenced him to an 18-month term of imprisonment, with a non-parole period of 12 months.

Allen will be eligible for release in May this year.