<PAGE>

                                FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C.  20549


           [X]  Quarterly Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934


                  For the quarterly period ended March 31, 2000

           [  ]  Transition Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                          Commission file number 1-7265


                                AMBASE CORPORATION


                (Exact name of registrant as specified in its charter)



                Delaware                                    95-2962743
        (State of incorporation)           (I.R.S. Employer Identification No.)

                           51 WEAVER STREET, BUILDING 2
                        GREENWICH, CONNECTICUT 06831-5155

              (Address of principal executive offices)  (Zip Code)

                                  (203) 532-2000

               (Registrant's telephone number, including area code)




Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months and (2) has been subject to such filing requirements for
the past 90 days.

YES     X        NO
     -------

At March 31, 2000,  there were 46,208,519  shares of registrant's  common stock,
$0.01 par value per share, outstanding, excluding 126,488 treasury shares.

<PAGE>

AmBase Corporation

Quarterly Report on Form 10-Q
March 31, 2000
<TABLE>
<CAPTION>

CROSS REFERENCE SHEET FOR
PARTS I and II                                                                                                 Page
<S>         <C>                                                                                                 <C>

PART I - FINANCIAL INFORMATION

Item 1.      Financial Statements.................................................................................1

Item 2.      Management's Discussion and Analysis of
                   Financial Condition and Results of Operations..................................................7

Item 3.      Quantitative and Qualitative Disclosures About Market Risk..........................................10

PART II - OTHER INFORMATION

Item 1.      Legal Proceedings...................................................................................11

Item 2.      Changes in Securities...............................................................................11

Item 3.      Defaults Upon Senior Securities.....................................................................11

Item 4.      Submission of Matters to a Vote of Security Holders.................................................11

Item 5.      Other Information...................................................................................11

Item 6.      Exhibits and Reports on Form 8-K....................................................................11

</TABLE>

<PAGE>

PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                                         AMBASE CORPORATION AND SUBSIDIARIES
                                        Consolidated Statements of Operations
                                               Quarter Ended March 31
                                                     (Unaudited)
                                         (in thousands, except per share data)

<TABLE>
<CAPTION>

<S>                                                                                  <C>                <C>
                                                                                           2000               1999
                                                                                          =====              =====
Operating expenses:
Compensation and benefits.........................................................   $      939         $      884
Professional and outside services.................................................          290                 65
Insurance.........................................................................           14                 18
Occupancy.........................................................................           24                 23
Other operating...................................................................           36                 48
                                                                                       --------           --------
                                                                                          1,303              1,038
                                                                                       --------           --------
Operating loss....................................................................       (1,303)            (1,038)
                                                                                       --------           --------
Interest income...................................................................          582                531
Other income......................................................................           50                 43
                                                                                       --------           --------
Loss before income taxes..........................................................         (671)              (464)
Income tax expense................................................................          (55)               (55)
                                                                                       --------           --------
Net loss..........................................................................   $     (726)        $     (519)
                                                                                          =====              =====
Earnings per common share:
Net loss - basic..................................................................   $    (0.02)        $    (0.01)
Net loss - assuming dilution......................................................        (0.02)             (0.01)
                                                                                          =====              =====

Average shares outstanding........................................................       46,190             44,534
                                                                                         ======             ======
</TABLE>

The  accompanying  notes are an integral  part of these  consolidated  financial
statements.

<PAGE>


                    AMBASE CORPORATION AND SUBSIDIARIES
                         Consolidated Balance Sheets
                               (in thousands)



<TABLE>
<CAPTION>

<S>                                                                                 <C>               <C>
                                                                                      March 31,       December 31,
                                                                                           2000               1999
                                                                                    (unaudited)
                                                                                       ========          =========
Assets
Cash and cash equivalents.........................................................   $      812         $    2,646
Investment securities - held to maturity (market
    value $43,237 and $43,259, respectively)......................................       43,282             43,260
Investment in SDG, Inc. at cost...................................................        1,250              1,250
Other assets......................................................................          503                522
                                                                                       --------           --------

Total assets......................................................................   $   45,847         $   47,678
                                                                                          =====              =====
Liabilities and Stockholders' Equity
Liabilities:
Accounts payable and accrued liabilities..........................................   $      605         $    1,902
Supplemental retirement plan......................................................        5,662              5,545
Postretirement welfare benefits...................................................        1,137              1,178
Other liabilities.................................................................          100                106
Litigation and contingency reserves...............................................        1,952              1,983
Income tax reserves...............................................................       66,388             66,388
                                                                                       --------           --------
Total liabilities.................................................................       75,844             77,102
                                                                                       --------           --------
Commitments and contingencies.....................................................            -                  -
                                                                                       --------           --------
Stockholders' equity:
Common stock......................................................................          463                455
Paid-in capital...................................................................      547,940            547,795
Accumulated deficit...............................................................     (577,753)          (577,027)
Treasury stock....................................................................         (647)              (647)
                                                                                       --------           --------
Total stockholders' equity........................................................      (29,997)           (29,424)
                                                                                       --------           --------

Total liabilities and stockholders' equity........................................   $   45,847         $   47,678
                                                                                          =====              =====
</TABLE>

The  accompanying  notes are an integral  part of these  consolidated  financial
statements.


<PAGE>


                       AMBASE CORPORATION AND SUBSIDIARIES
                      Consolidated Statements of Cash Flows
                           Three Months Ended March 31
                                 (in thousands)



<TABLE>
<CAPTION>

<S>                                                                                  <C>                 <C>
                                                                                           2000               1999
                                                                                           ====               ====
Cash flows from operating activities:
Net loss..........................................................................    $    (726)          $   (519)
Adjustments to reconcile net loss to net cash used by operations:
Other assets......................................................................           15                 35
Accounts payable and accrued liabilities..........................................       (1,297)            (1,017)
Litigation and contingency reserves uses..........................................          (31)                (6)
Other liabilities.................................................................           70                 43
Amortization of discount - investment securities..................................         (577)              (525)
Other, net........................................................................            4                  3
                                                                                       --------           --------
Net cash used by operating activities.............................................       (2,542)            (1,986)
                                                                                       --------           --------
Cash flows from investing activities:
Maturities of investment securities - held to maturity............................       61,300             23,446
Purchases of investment securities - held to maturity.............................      (60,745)           (22,202)
Purchases of other investment securities..........................................            -               (250)
                                                                                       --------           --------
Net cash provided by investing activities.........................................          555                994
                                                                                       --------           --------
Cash flows from financing activities:
Stock options exercised...........................................................          153                  -
                                                                                       --------           --------
Net cash provided by financing activities.........................................          153                  -
                                                                                       --------           --------
Net decrease in cash and cash equivalents.........................................       (1,834)              (992)
Cash and cash equivalents at beginning of period..................................        2,646              2,886
                                                                                       --------           --------
Cash and cash equivalents at end of period........................................    $     812          $   1,894
                                                                                          =====              =====
Supplemental cash flow disclosures:
Income taxes paid.................................................................    $      49          $      53
                                                                                          =====              =====
</TABLE>

The  accompanying  notes are an integral  part of these  consolidated  financial
statements.

<PAGE>

                      AMBASE CORPORATION AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements


Note 1 - Organization

The accompanying  consolidated  financial  statements of AmBase  Corporation and
subsidiaries (the "Company") are unaudited and subject to year-end  adjustments.
All material intercompany transactions and balances have been eliminated. In the
opinion of management, the interim financial statements reflect all adjustments,
consisting of normal recurring adjustments, necessary for a fair presentation of
the Company's financial position and results of operations.  Results for interim
periods are not  necessarily  indicative  of results for the full year.  Certain
reclassifications  have been made to the 1999 consolidated  financial statements
to conform with the 2000  presentation.  The consolidated  financial  statements
have been prepared in accordance with generally accepted  accounting  principles
("GAAP").  The  preparation  of financial  statements  in  conformity  with GAAP
requires  management to make certain  estimates and  assumptions,  that it deems
reasonable,  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting   period.   Actual  results  could  differ  from  such  estimates  and
assumptions.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going  concern.  Substantial  contingent and
alleged  liabilities  exist  against the Company  through  certain  lawsuits and
governmental proceedings;  see Part II - Item 1. These factors raise substantial
doubt about the Company's ability to continue as a going concern.  The financial
statements  do not  include  adjustments  to the  carrying  value of assets  and
liabilities,  which  might be  necessary  should the  Company  not  continue  in
operation.  In order to  continue on a long-term  basis,  the Company  must both
resolve its  contingent and alleged  liabilities by prevailing  upon or settling
these claims for less than the amounts claimed and generate profits by acquiring
existing  operations and/or by developing new operations.  The Company continues
to evaluate a number of possible acquisitions,  and is engaged in the management
of its remaining  assets and  liabilities,  including the contingent and alleged
tax and  litigation  liabilities,  as described in Part II - Item 1. The Company
intends to  aggressively  contest  all  pending and  threatened  litigation  and
governmental  proceedings,  as well as pursue all sources for  contributions  to
settlements.  The unaudited interim financial statements presented herein should
be read in  conjunction  with the Company's  consolidated  financial  statements
filed in its Annual Report on Form 10-K for the year ended December 31, 1999.

The  Company's  main  source of  non-operating  revenue  is  interest  earned on
investment  securities and cash equivalents.  The Company's  management  expects
that operating  cash needs for the remainder of 2000 will be met  principally by
the Company's  current  financial  resources,  and the receipt of  non-operating
revenue  consisting  of  interest  income  on  investment  securities  and  cash
equivalents.

Note 2 - Legal Proceedings

The  Company  has  significant  alleged tax  liabilities  and is a defendant  in
certain  lawsuits and  governmental  proceedings,  the ultimate outcome of which
could have a material  adverse effect on its financial  condition and results of
operations.  Because  of the  nature  of the  contingent  and  alleged  tax  and
litigation  liabilities  described  in  Part  II -  Item  1,  and  the  inherent
difficulty  in  predicting  the  outcome  of  the  litigation  and  governmental
proceedings,  management  is unable to predict  whether the  Company's  recorded
reserves  will be adequate or its  resources  sufficient to satisfy its ultimate
obligations.  The accompanying  consolidated financial statements do not include
any  adjustments  that might  result  from the  outcome of these  uncertainties.
Although  the  basis  for the  calculation  of the  litigation  and  contingency
reserves  and  income tax  reserves  are  regularly  reviewed  by the  Company's
management and outside legal counsel,  the assessment of these reserves includes
an exercise  of judgment  and is a matter of  opinion.  At March 31,  2000,  the
litigation  and  contingency  reserves,  other than for income tax issues,  were
$1,952,000.   For  a  discussion  of  alleged  tax  liabilities,   lawsuits  and
governmental proceedings, see Part II - Item 1.

In  addition  to the  litigation  and  contingency  reserves,  the Company has a
reserve  for  income  taxes of  $66,388,000  at March  31,  2000.  For a further
discussion,  see Part II - Item 1 - Legal  Proceedings,  Dispute  with  Internal
Revenue Service over Withholding Taxes (Netherlands Antilles).

See  Part II - Item 1 -  Legal  Proceedings,  for a  discussion  of  Supervisory
Goodwill Litigation and information  regarding the Company's claims against Home
Holdings, Inc.

<PAGE>

                      AMBASE CORPORATION AND SUBSIDIARIES
             Notes to Consolidated Financial Statements (continued)


Note 3 - Cash and Cash Equivalents

Highly liquid  investments,  consisting  principally of funds held in short-term
money market accounts, are classified as cash equivalents.

Note 4 - Investment Securities

Investment  securities - held to maturity  consist of U.S.  Treasury  Bills with
original  maturities of one year or less and are carried at amortized cost based
upon the Company's intent and ability to hold these investments to maturity.

Investment securities - held to maturity at March 31, 2000 and December 31, 1999
consist of the following:

<TABLE>
<CAPTION>

                                            March 31, 2000                                  December 31, 1999
                             ========================================        ===========================================
<S>                           <C>            <C>           <C>               <C>            <C>           <C>

                                                            Cost or                                          Cost or
                              Carrying       Amortized         Fair           Carrying      Amortized           Fair
(in thousands)                   Value            Cost        Value              Value           Cost          Value
                              ========      ==========      =======           ========      =========        =======

U.S. Treasury Bills          $ 43,282        $ 43,282      $ 43,237          $  43,260       $ 43,260     $   43,259
                                ======         ======        ======             ======         ======         ======
</TABLE>

The gross  unrealized  losses on investment  securities was $45,000 at March 31,
2000 and $1,000 at December 31, 1999.

Other investment securities consist of convertible preferred and/or common stock
in AMDG, Inc., which were purchased through private  placements,  are classified
as other  assets,  and are  carried at cost  which  approximates  market  value;
$350,000 at March 31, 2000 and December 31, 1999.


<PAGE>

                       AMBASE CORPORATION AND SUBSIDIARIES
             Notes to Consolidated Financial Statements (continued)


Note 5 - Income Taxes

The Company and its 100% owned domestic subsidiaries file a consolidated federal
income tax return.  The Company  recognizes  both the current and  deferred  tax
consequences  of all  transactions  that have been  recognized  in the financial
statements,  calculated  based on the provisions of enacted tax laws,  including
the tax rates in effect for current and future  years.  Net  deferred tax assets
are  recognized  immediately  when a more likely than not criterion is met; that
is, unless a greater than 50% probability  exists that the tax benefits will not
actually be realized  sometime in the future.  The Company has  calculated a net
deferred  tax asset of $28  million as of March 31,  2000 and $28  million as of
December  31,  1999,   arising   primarily   from  net  operating  loss  ("NOL")
carryforwards,  alternative  minimum tax credits and the excess of book over tax
reserves (not  including  the  anticipated  tax effects of NOL's  expected to be
generated  from the  Company's  tax basis in Carteret  Savings  Bank,  F.A.  and
subsidiaries  ("Carteret"),  resulting from the election decision, as more fully
described below). A valuation  allowance has been established for the entire net
deferred tax asset, as management, at the current time, has no basis to conclude
that realization is more likely than not.

As a result of the Office of Thrift Supervision's  December 4, 1992 placement of
Carteret  in  receivership,   under  the  management  of  the  Resolution  Trust
Corporation ("RTC")/Federal Deposit Insurance Corporation ("FDIC"), and proposed
Treasury  Reg.  ss.1.597-4(g),  the  Company had  previously  filed its 1992 and
subsequent  federal  income tax returns  with  Carteret  disaffiliated  from the
Company's  consolidated  federal  income  tax  return.  Based upon the impact of
Treasury Reg. ss.1.597-4(g),which was issued in final form on December 20, 1995,
a continuing  review of the Company's  tax basis in Carteret,  and the impact of
prior year tax return  adjustments  on the  Company's  1992  federal  income tax
return as filed,  the Company decided not to make an election  pursuant to final
Treasury  Reg.   ss.1.597-4(g)  to  disaffiliate  Carteret  from  the  Company's
consolidated  federal  income tax return  effective  as of December 4, 1992 (the
"election decision").

The  Company has made  numerous  requests to the  RTC/FDIC  for tax  information
pertaining to Carteret and the resulting successor institution, Carteret Federal
Savings Bank ("Carteret FSB"); however all of the information still has not been
received.  Based on the Company not making the election  decision,  as described
above,  and the receipt of some of the requested  information from the RTC/FDIC,
the  Company  has amended  its 1992  consolidated  federal  income tax return to
include the federal income tax effects of Carteret and Carteret FSB. The Company
is still in the process of amending its consolidated  federal income tax returns
for 1993 and subsequent years.

The  Company  anticipates  that,  as a result of filing a  consolidated  federal
income tax return with  Carteret FSB, a total of  approximately  $170 million of
tax NOL  carryforwards  will be  generated  from  the  Company's  tax  basis  in
Carteret/Carteret  FSB as tax losses are  incurred by Carteret FSB of which $158
million are still available for future use. Based on the Company's recent filing
of its  amended  1992  consolidated  federal  income tax  return to include  the
federal  income tax effects of Carteret  FSB,  approximately  $56 million of NOL
carryforwards  are  generated  for tax year 1992 which expire in 2007,  with the
remaining  approximate  $102  million  of  NOL  carryforwards  to be  generated,
expiring no earlier  than 2008.  These NOL  carryforwards  would be available to
offset future taxable income,  in addition to the NOL  carryforwards  as further
detailed below.

In June 1998,  the Company  paid  $12,700,000  to the IRS for tax and  estimated
interest to be applied to the Company's Fresh Start tax liability, which related
to a 1987 tax dispute  with the IRS.  Based on a Final  Stipulation  between the
Company and the IRS on the Fresh Start issue, the Company is presently  awaiting
the IRS's final  calculation of interest on the Fresh Start issue. In connection
with the Final Stipulation,  the Company anticipates utilizing approximately $29
million of NOL's.

Based upon the Company's  federal  income tax returns as filed from 1993 to 1998
(subject  to  IRS  audit  adjustments),  after  utilizing  $29  million  of  NOL
carryfowards in connection with Fresh Start;  and excluding the NOL carryfowards
generated from the Company's tax basis in Carteret/Carteret FSB, as noted above,
at March 31, 2000 the Company has NOL  carryforwards  aggregating  approximately
$20 million,  available to reduce future federal  taxable income which expire if
unused beginning in 2008.

<PAGE>

The utilization of certain  carryforwards  is subject to limitations  under U.S.
federal income tax laws. In addition,  the Company has approximately $21 million
of  alternative  minimum  tax  credit  carryforwards,  which are not  subject to
expiration.

The Company  contractually assumed the tax liabilities of City Investing Company
("City"),  which,  prior to September 1985, owned all the outstanding  shares of
Common  Stock of the  Company.  For all periods  through  1992,  the IRS and the
Company  disagree only with respect to  withholding  taxes in connection  with a
Netherlands  Antilles finance  subsidiary of City. The Company's  federal income
tax returns for years subsequent to 1992 have not been reviewed by the IRS.

The Company has a reserve for income taxes of $66,388,000 at March 31, 2000. For
a further  discussion,  see Part II - Item 1 - Legal  Proceedings,  Dispute with
Internal Revenue Service over Withholding Taxes (Netherlands Antilles).

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS

Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations,  which follows,  should be read in conjunction with the consolidated
financial statements and related notes, which are contained in Item 1, herein.

FINANCIAL CONDITION

The  Company's  assets  at March  31,  2000  aggregated  $45,847,000  consisting
principally of cash and cash  equivalents of $812,000 and investment  securities
of $43,282,000. At March 31, 2000, the Company's liabilities, including reserves
for contingent and alleged  liabilities,  as further described in Part II - Item
1, exceeded total recorded assets by $29,997,000.

The Company  contractually assumed the tax liabilities of City Investing Company
("City"),  which,  prior to September 1985, owned all the outstanding  shares of
Common  Stock of the  Company.  For all periods  through  1992,  the IRS and the
Company  disagree only with respect to  withholding  taxes in connection  with a
Netherlands  Antilles  finance  subsidiary of City  ("Withholding  Taxes").  The
Company's  federal income tax returns for years subsequent to 1992 have not been
reviewed by the IRS.

With respect to the  Withholding  Taxes issue,  in connection with a Netherlands
Antilles finance subsidiary of City, on May 11, 1995, the IRS issued a Notice of
Deficiency for withholding taxes on interest payments for the years 1979 through
1985.  In the Notice of  Deficiency,  the IRS contends  that City's wholly owned
Netherlands  Antilles finance subsidiary should be disregarded for tax purposes.
The Company vigorously contested the IRS's position in accordance with the IRS's
internal  appeals  procedures.  In January 1992, the National  Office of the IRS
issued technical advice  supporting the auditing  agent's  position.  In October
1992, the Company  appealed this technical  advice to the National  Office.  The
National Office advised the Company that it expected to issue  technical  advice
supporting the auditing agent's position,  whereupon the Company advised the IRS
that it was withdrawing its technical advice request.

On June 30, 1995,  the Company  filed a petition in the United  States Tax Court
("Tax Court")  contesting the Notice of Deficiency.  The IRS filed its answer on
August 23, 1995. The Company filed a motion for summary judgment in its favor on
February 13, 1996. On April 17, 1996, the IRS filed a Notice of Objection to the
Company's motion for summary judgment. The Tax Court requested,  and the Company
filed,  on July 3, 1996, a reply to the IRS's Notice of Objection.  On September
19, 1996,  the Court denied the Company's  motion for summary  judgment  without
prejudice.  Based on the Tax Court's examination of the record and the status of
the discovery process, the Tax Court concluded that summary adjudication at this
time was inappropriate. The Tax Court directed the parties to engage in full and
complete  discovery as expeditiously as possible.  A trial was held in this case
on March 24, 1997, after which the Judge asked the IRS and the Company to submit
post-trial briefs,  which were submitted to the Tax Court in August 1997. If the
IRS were to prevail on this  issue,  the  Company  would be liable for taxes and
interest in excess of the Company's financial resources.

<PAGE>

In a case dealing with a similar  withholding tax issue,  the Tax Court ruled in
favor of the taxpayer, Northern Indiana Public Service Co. ("Northern Indiana"),
in November 1995. The Tax Court rejected the IRS's contention that interest paid
to  Northern  Indiana's  foreign  subsidiary  was  subject to United  States tax
withholding. The IRS appealed this decision (Northern Indiana Public Service Co.
v.  Commissioner) to the United States Court of Appeals for the 7th Circuit (the
"Appeals Court"). In June 1997 the Appeals Court affirmed the Tax Court's ruling
in favor of  Northern  Indiana.  Although  the  Appeals  Court  decision  in the
Northern  Indiana case could be  beneficial  to the  Company's  case,  it is not
necessarily  indicative  of the ultimate  result of the final  settlement of the
Netherlands Antilles issue between the Company and the IRS.

Based on an evaluation of the IRS's contention,  counsel has advised the Company
that, although the outcome in litigation can by no means be assured, the Company
has a very strong case and should prevail. Notwithstanding counsel's opinion and
the Tax Court's ruling in the Northern  Indiana case, it is not possible at this
time to determine the final  disposition of this issue,  when the issues will be
resolved,  or their final financial effect. A final disposition of this issue in
the  Company's  favor  would have a material  positive  effect on the  Company's
Consolidated Statement of Operations and Financial Condition.

The Company has a reserve for income taxes of $66,388,000 at March 31, 2000. For
a further  discussion,  see Part II - Item 1 - Legal  Proceedings,  Dispute with
Internal Revenue Service over Withholding Taxes (Netherlands Antilles).

At March 31, 2000,  the  litigation  and  contingency  reserves,  other than for
income tax issues, were $1,952,000. For a discussion of alleged tax liabilities,
lawsuits and governmental proceedings, see Part II - Item 1.

The  Company  has  significant  alleged tax  liabilities  and is a defendant  in
certain  lawsuits and  governmental  proceedings,  the ultimate outcome of which
could have a material  adverse effect on its financial  condition and results of
operations.  Because of the nature of the contingent and alleged liabilities and
the  inherent  difficulty  in  predicting  the  outcome  of the  litigation  and
governmental proceedings,  management is unable to predict whether the Company's
recorded  reserves will be adequate or its  resources  sufficient to satisfy its
ultimate obligations.  The accompanying consolidated financial statements do not
include  any   adjustments   that  might   result  from  the  outcome  of  these
uncertainties.  Although the basis for the  calculation  of the  litigation  and
contingency  reserves and the income tax reserves are regularly  reviewed by the
Company's management and outside legal counsel, the assessment of these reserves
includes an exercise of judgment,  and is a matter of opinion.  For a discussion
of alleged tax liabilities, lawsuits and governmental proceedings, see Part II -
Item 1.

The  cash  needs  of the  Company  for the  first  three  months  of  2000  were
principally  satisfied by interest income received on investment  securities and
cash  equivalents,  and the Company's current  financial  resources.  Management
believes that the Company's cash resources are sufficient to continue operations
for 2000.

For the three  months  ended  March 31,  2000,  cash of  $2,542,000  was used by
operations, including the payment of prior year accruals and operating expenses,
partially offset by the receipt of interest income.

For the three  months  ended  March 31,  1999,  cash of  $1,986,000  was used by
operations, including the payment of prior year accruals and operating expenses,
partially offset by the receipt of interest income.

The  Company  continues  to evaluate a number of  possible  acquisitions  and is
engaged in the management of its remaining assets and liabilities, including the
contingent  and alleged tax and  litigation  liabilities,  as  described  above.
Extensive  discussions and  negotiations  are ongoing with respect to certain of
these  matters.  The  Company  intends to  aggressively  contest all pending and
threatened  litigation  and  governmental  proceedings,  as well as pursuing all
sources of  contributions  to  settlements.  In order to continue on a long-term
basis,  the Company must both resolve its contingent and alleged  liabilities by
prevailing upon or settling these claims for less than the amounts claimed,  and
generate  profits by acquiring  existing  operations  and/or by  developing  new
operations.

There were no  material  commitments  for capital  expenditures  as of March 31,
2000.

<PAGE>

Results of Operations

Summarized  financial  information  of the Company for the first  quarter  ended
March 31 is as follows:

<TABLE>
<CAPTION>

                                                                                                First Quarter
(in thousands)                                                                             2000               1999
                                                                                          =====              =====
<S>                                                                                  <C>                <C>

Operating expenses:
Compensation and benefits.........................................................   $      939         $      884
Professional and outside services.................................................          290                 65
Insurance.........................................................................           14                 18
Occupancy.........................................................................           24                 23
Other operating...................................................................           36                 48
                                                                                       --------           --------
                                                                                          1,303              1,038
                                                                                       --------           --------
Operating loss....................................................................       (1,303)            (1,038)
                                                                                       --------           --------
Interest income...................................................................          582                531
Other income......................................................................           50                 43
                                                                                       --------           --------
Loss before income taxes..........................................................         (671)              (464)
Income tax expense................................................................          (55)               (55)
                                                                                       --------           --------
Net loss..........................................................................   $     (726)        $     (519)
                                                                                          =====              =====
</TABLE>

The Company's main source of non-operating  revenue is interest income earned on
investment  securities and cash equivalents.  The Company's  management  expects
that operating  cash needs for the remainder of 2000 will be met  principally by
the  Company's  current  financial  resources  and the receipt of  non-operating
revenue  consisting of interest income earned on investment  securities and cash
equivalents.

The Company  recorded a net loss of  $726,000 or $0.02 per share,  for the first
quarter  ended March 31, 2000  compared to a net loss of $519,000,  or $0.01 per
share, for the first quarter ended March 31, 1999.

Compensation and benefits increased to $939,000 in the first quarter ended March
31,  2000,  compared  with  $884,000  the 1999 first  quarter.  The  increase is
primarily  due to an increase in the  accrual for 2000  incentive  compensation,
which is not guaranteed, as compared to prior year amounts.

Professional  and outside  services  increased to $290,000 in the first  quarter
ended March 31, 2000,  compared to $65,000 in the  respective  1999 period.  The
increase  in  the  2000  period  is  primarily  the  result  of an  increase  in
Supervisory  Goodwill  litigation  expenses as a result of the Company's Summary
Judgment  motion and expert report  preparation as further  discussed in Part II
Item 1.

Insurance  expenses  decreased to $14,000 in the first  quarter  ended March 31,
2000, compared to $18,000 in the same 1999 period, due to management's continued
renegotiations of insurance premiums.

Interest  income in the first quarter ended March 31, 2000 increased to $582,000
from  $531,000  in the  respective  1999  period.  The  increase  was  primarily
attributable  to an increased  yield on  investments  held in 2000 compared with
1999.

Other  income of $50,000  and  $43,000  for the first  quarter of 2000 and 1999,
respectively is principally due to the collection by an inactive subsidiary of a
receivable previously considered uncollectible.

<PAGE>

The income tax  provisions  of $55,000 in the first quarter ended March 31, 2000
and 1999, is primarily  attributable to provisions for state taxes. Income taxes
applicable to operating  income (loss) are generally  determined by applying the
estimated  effective  annual  income tax rates to pretax  income  (loss) for the
year-to-date interim period.  Income taxes applicable to unusual or infrequently
occurring items are provided in the period in which such items occur.

ITEM 3.      QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company holds short-term investments as a source of liquidity. The Company's
interest rate sensitive investments at March 31, 2000 and December 31, 1999 with
maturity dates of less than one year consist of the following:

<TABLE>
<CAPTION>

                                                            2000                           1999
                                                   ========================       =======================
                                                    Carrying          Fair        Carrying          Fair
                                                      Value          Value          Value          Value
(in thousands)                                     -----------      -------      -----------     --------
<S>                                                  <C>             <C>            <C>           <C>


U.S. Treasury Bills.........................         $43,282         $43,237        $43,260       $43,259
                                                     =======         =======         ======        ======

Weighted average interest rate..............           5.68%                          4.81%
                                                     =======                         ======
</TABLE>

The  Company's  current  policy is to  minimize  the  interest  rate risk of its
short-term  investments by investing in U.S.  Treasury Bills with  maturities of
less than one year. There were no significant changes in market exposures or the
manner in which interest rate risk is managed during the year.


STOCKHOLDER INQUIRIES

Stockholder  inquiries,  including  requests  for the  following:  (i) change of
address;  (ii) replacement of lost stock  certificates;  (iii) Common Stock name
registration changes; (iv) Quarterly Reports on Form 10-Q; (v) Annual Reports on
Form 10-K; (vi) proxy material;  and (vii) information regarding stock holdings,
should be directed to:

         American Stock Transfer and Trust Company
         40 Wall Street, 46th Floor
         New York, NY  10005
         Attention:  Shareholder Services
         (800) 937-5449 or (718) 921-8200

In addition,  the Company's public reports,  including Quarterly Reports on Form
10-Q, Annual Reports on Form 10-K and Proxy Statements,  can be obtained through
the Securities  and Exchange  Commission  EDGAR  Database over the Internet,  at
www.sec.gov.

<PAGE>

Part II - OTHER INFORMATION

Item 1.  LEGAL PROCEEDINGS

The information  contained in Item 8 - Note 11 in AmBase's Annual Report on Form
10-K for the year ended December 31, 1999 is  incorporated  by reference  herein
and the defined terms set forth below have the same meaning  ascribed to them in
that report. There have been no material developments in such legal proceedings,
except as set forth below.

The  actions  against  the  Company  are in various  stages.  Nevertheless,  the
allegations  and  claims  are  material  and,  if  successful,  could  result in
substantial  judgments  against the Company.  To the extent the aggregate of any
such judgments were to exceed the resources available,  these matters would have
a material  adverse effect on the Company's  financial  condition and results of
operations. Due to the nature of these proceedings,  the Company and its counsel
are unable to express any opinion as to their probable outcome.


ITEM 2. CHANGES IN SECURITIES

Does not apply.

ITEM 3.       DEFAULTS UPON SENIOR SECURITIES

Does not apply.

ITEM 4.       SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Does not apply.

ITEM 5.       OTHER INFORMATION

None

ITEM 6.       EXHIBITS AND REPORTS ON FORM 8-K

(a)   Exhibits

      27.  Financial Data Schedule (only submitted to SEC in electronic format)

(b)   Form 8-K

      None

<PAGE>

                                 SIGNATURES


Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


AMBASE CORPORATION



By    JOHN P. FERRARA
      Vice President, Chief Financial Officer and Controller
      (Principal Financial and
      Accounting Officer)

Date:  May 15, 2000