<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

                                QUARTERLY REPORT

     (Mark One)
        [ 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

                      For the transition period from___________to___________

                         Commission File Number 0-11287

                    THE CLARIDGE HOTEL AND CASINO CORPORATION
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)


                 New York                                    22-2469172
      -------------------------------                  ----------------------
      (State or other jurisdiction of                     (I.R.S. Employer
      incorporation or organization)                   Identification Number)

      Indiana Avenue and the Boardwalk
         Atlantic City, New Jersey                              08401
  ----------------------------------------                   ----------
  (Address of principal executive offices)                   (Zip Code)

       Registrant's telephone number, including area code: (609) 340-3400

                               ------------------


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 (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes __X__   No ____

The number of shares outstanding of each class of the Registrant's Stock is as
follows:

                          Number of Shares Outstanding
                                  May 12, 2000
                                  ------------
Class A Stock                       5,062,500


<PAGE>



           THE CLARIDGE HOTEL AND CASINO CORPORATION AND SUBSIDIARIES
           ----------------------------------------------------------
                (Debtor-In-Possession effective August 16, 1999)

                               Index to Form 10-Q


                                                                        Page No.
                                                                        --------

PART I.                    FINANCIAL INFORMATION


               Item 1.     Financial Statements

                           Introductory Notes to Consolidated
                           Financial Statements                              3

                           Consolidated Balance Sheets at
                           March 31, 2000 (unaudited)
                           and December 31, 1999                             4

                           Consolidated Statements of Operations
                           for the three months ended March 31,
                           2000 (unaudited) and 1999 (unaudited)             5

                           Consolidated Statements of Cash Flows
                           for the three months ended March 31, 2000
                           (unaudited) and 1999 (unaudited)                  6

                           Notes to Consolidated Financial
                           Statements                                        8

               Item 2.     Management's Discussion and Analysis
                           of Financial Condition and Results
                           of Operations                                    15

PART II.                   OTHER INFORMATION

               Item 6.     Exhibits and Reports on Form 8-K                 22





                                        1

<PAGE>




















                      [THIS PAGE INTENTIONALLY LEFT BLANK]


















<PAGE>



           THE CLARIDGE HOTEL AND CASINO CORPORATION AND SUBSIDIARIES
           ----------------------------------------------------------
                (Debtor-In-Possession effective August 16, 1999)


                          PART I. FINANCIAL INFORMATION



Item 1. Financial Statements

Introductory Notes to Consolidated Financial Statements

        The accompanying consolidated financial statements have been prepared by
The Claridge Hotel and Casino Corporation ("Corporation") without audit,
pursuant to the rules and regulations of the Securities and Exchange Commission.
In the opinion of management, these financial statements contain all adjustments
necessary to present fairly the consolidated financial position of The Claridge
Hotel and Casino Corporation and its wholly-owned subsidiaries, The Claridge at
Park Place, Incorporated ("New Claridge") and Claridge Gaming Incorporated
("CGI") at March 31, 2000 and December 31, 1999, and the results of its
operations for the three months ended March 31, 2000 and 1999 and its cash flows
for the three months ended March 31, 2000 and 1999. All adjustments made are of
a normal recurring nature.

        Although management believes that the disclosures included herein are
adequate to make the information contained herein not misleading, certain
information and footnote disclosure normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
omitted. It is suggested that these financial statements be read in conjunction
with the financial statements and the related disclosures contained in the
Corporation's Annual Report on Form 10-K for the year ended December 31, 1999
filed with the Securities and Exchange Commission.

        As discussed in Note 1 to the consolidated financial statements, the
Corporation filed for reorganization under Chapter 11 of the United States
Bankruptcy Code on August 16, 1999. In addition, Atlantic City Boardwalk
Associates, L.P. (the "Partnership") filed for reorganization under Chapter 11
of the United States Bankruptcy Code on October 5, 1999. The accompanying
consolidated financial statements do not claim to reflect or provide for the
consequences of the bankruptcy proceedings. In particular, such consolidated
financial statements do not show (i) as to assets, their realizable value on a
liquidation basis or their availability to satisfy liabilities; (ii)
contingencies, or the status and priority thereof; or (iii) as to stockholder
accounts, the effect of any changes that may be made in the Corporation's
business. The eventual outcome of these matters is not presently determinable.

        The results of operations for the three months ended March 31, 2000 and
1999 are not necessarily indicative of the operating results to be expected for
the full year. Historically, the gaming industry in Atlantic City, New Jersey
has been seasonal in nature with peak demand months occurring during the summer
season.










                                        3

<PAGE>



           THE CLARIDGE HOTEL AND CASINO CORPORATION AND SUBSIDIARIES
                (Debtor-In-Possession effective August 16, 1999)
                           Consolidated Balance Sheets
                                 (in thousands)
<TABLE>
<CAPTION>
                                                                                      (Unaudited)               (Audited)
                                                                                        March 31,              December 31,
                                                                                          2000                     1999
                                                                                      -----------              ------------
<S>                                                                                <C>                        <C>
ASSETS
------
Current Assets:
  Cash and cash equivalents                                                             $ 18,152                  16,834
  Receivables, net (including $5,719
    at March 31, 2000 and $6,269 at December 31,
    1999, due from the Partnership)                                                        8,309                   7,977
  Other current assets                                                                     3,491                   3,421
                                                                                        --------                --------
        Total current assets                                                              29,952                  28,232
                                                                                        --------                --------

Property and equipment, net (note 4)                                                      28,578                  28,342
Long-term receivables due from the
  Partnership (note 3)                                                                    41,516                  41,831
Intangible assets and deferred charges                                                     1,003                   1,076
Other assets                                                                               3,356                   3,041
                                                                                        --------                --------
                                                                                        $104,405                 102,522
                                                                                        ========                ========

LIABILITIES & STOCKHOLDERS' DEFICIENCY
--------------------------------------
Current Liabilities Not Subject to Compromise:
  Current maturities of long-term debt (note 7)                                       $       79                     125
  Accounts payable (note 10)                                                               3,836                   2,902
  Loan from the Partnership (notes 5 and 10)                                                 -0-                     -0-
  Other current liabilities (notes 6 and 10)                                              16,154                  14,253
                                                                                        --------                --------
        Total current liabilities not subject to compromise                               20,069                  17,280
                                                                                        --------               ---------

Liabilities Subject to Compromise (note 10)                                              145,470                 145,259

Long-term debt (notes 7 and 10)                                                              -0-                       1
Deferred rent due to the Partnership (note 10)                                               -0-                     -0-
Deferred income taxes (notes 9 and 10)                                                     2,046                   2,046
Other noncurrent liabilities (notes 8 and 10)                                              1,379                   1,354

Stockholders' deficiency:
  Common stock                                                                                 5                       5
  Additional paid in capital                                                               5,048                   5,048
  Accumulated deficit                                                                    (69,612)                (68,471)
                                                                                        --------               ---------

        Total stockholders' deficiency                                                   (64,559)                (63,418)
                                                                                        --------               ---------
                                                                                        $104,405                 102,522
                                                                                        ========                ========
</TABLE>

          See accompanying notes to consolidated financial statements.

                                        4

<PAGE>



           THE CLARIDGE HOTEL AND CASINO CORPORATION AND SUBSIDIARIES
                (Debtor-In-Possession effective August 16, 1999)
                      Consolidated Statements of Operations
               For the Three Months Ended March 31, 2000 and 1999
                      (in thousands except per share data)
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                                          2000                   1999
                                                                                        --------               --------
<S>                                                                                   <C>                    <C>
Revenues:
        Casino                                                                          $ 38,760                 36,554
        Hotel                                                                              2,152                  1,994
        Food and beverage                                                                  4,561                  4,252
        Interest from the Partnership                                                      2,267                  2,961
        Interest, other                                                                       38                     87
        Other                                                                                704                  2,875
                                                                                        --------               --------
                                                                                          48,482                 48,723
        Less promotional allowances (note 2)                                               5,096                  4,870
                                                                                        --------               --------
             Net revenues                                                                 43,386                 43,853
                                                                                        --------               --------
Costs and expenses:
        Casino                                                                            23,606                 22,840
        Hotel                                                                                637                    629
        Food and beverage                                                                  1,371                  1,186
        Other                                                                                983                    622
        Rent expense to the Partnership                                                    6,740                  6,264
        Rent expense, other                                                                  284                    304
        General and administrative                                                         6,157                  6,777
        Gaming taxes                                                                       3,088                  2,909
        Reinvestment obligation expense                                                      175                    150
        Provision for uncollectible accounts                                                 157                    196
        Depreciation and amortization                                                        371                    525
        Interest expense (contractual interest of $3,212 in 2000)                             27                  2,699
                                                                                        --------               --------
             Total costs and expenses                                                     43,596                 45,101
                                                                                        --------               --------

Loss before reorganization items                                                            (210)                (1,248)
Reorganization items:
        Professional fees                                                                 (1,074)                   -0-
        Interest earned from accumulated cash resulting
              from Chapter 11 proceeding                                                     143                    -0-
                                                                                        --------               --------
                                                                                            (931)                   -0-
                                                                                        --------               --------

Net loss                                                                                $ (1,141)                (1,248)
                                                                                        ========               ========
Net loss per share (based on 5,062,500
  weighted average shares outstanding for the three months
  ended March 31, 2000 and 1999)                                                        $   (.23)                  (.25)
                                                                                        ========               ========
</TABLE>

          See accompanying notes to consolidated financial statements.

                                        5

<PAGE>



           THE CLARIDGE HOTEL AND CASINO CORPORATION AND SUBSIDIARIES
                (Debtor-In-Possession effective August 16, 1999)
                      Consolidated Statements of Cash Flows
               For the Three Months Ended March 31, 2000 and 1999
                                 (in thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                           2000                   1999
                                                                                         --------                -------
<S>                                                                                    <C>                    <C>
Cash flows from operating activities:
     Net loss                                                                            $(1,141)                (1,248)
     Adjustments to reconcile net loss to net
       cash provided by operating activities:
          Depreciation and amortization                                                      371                    525
          Deferred rent to the Partnership                                                   310                    310
          Deferred interest receivable and discount from the Partnership                     -0-                   (549)
          Reinvestment obligation expenses                                                   175                    150
          Gain on disposal of assets                                                         (32)                   (14)
          Deferred gain on disposal of assets                                                (26)                   (26)
          Reorganization items                                                               931                    -0-
          Change in assets and liabilities:
             (Increase) decrease in receivables, net, excluding
               current portion of long-term receivables                                     (692)                   696
             (Increase) decrease in other current assets                                     (70)                    96
             Increase in accounts payable                                                    835                  2,413
             Increase (decrease) in other current liabilities                                827                   (543)
             Increase (decrease) in other noncurrent liabilities                              51                     (5)
                                                                                        --------                 ------
                      Net cash provided by operating activities
                          before reorganization items                                      1,539                  1,805

              Reorganization items:
                 Professional fees paid                                                      -0-                    -0-
                 Interest earned on accumulated cash resulting from
                    Chapter 11 proceeding                                                    143                    -0-
                                                                                        --------                 ------

                      Net cash provided by operating activities                            1,682                  1,805
                                                                                        --------                 ------
</TABLE>


                                   (continued)



          See accompanying notes to consolidated financial statements.

                                        6

<PAGE>



           THE CLARIDGE HOTEL AND CASINO CORPORATION AND SUBSIDIARIES
                (Debtor-In-Possession effective August 16, 1999)
                Consolidated Statements of Cash Flows (continued)
               For the Three Months Ended March 31, 2000 and 1999
                                 (in thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                           2000                   1999
                                                                                         --------                -------
<S>                                                                                    <C>                    <C>
Cash flows from investment activities:
     Increase in intangible assets and deferred charges                                      (59)                   (22)
     Additions to property and equipment                                                    (480)                   (29)
     Increase in other assets                                                               (490)                  (475)
     Proceeds from disposal of assets                                                         36                    -0-
     Increase in long-term receivables                                                       -0-                    (76)
     Receipt of long-term receivables                                                        676                    467
                                                                                        --------                -------

                      Net cash used in investment activities                                (317)                  (135)
                                                                                        --------                -------
Cash flows from financing activities -
     Payment of long-term debt                                                               (47)                   (95)
                                                                                        --------                -------

                      Increase in cash and cash equivalents                                1,318                  1,575

Cash and cash equivalents at beginning of period                                          16,834                  9,798
                                                                                        --------                -------

Cash and cash equivalents at end of period                                              $ 18,152                 11,373
                                                                                        ========                =======
</TABLE>



          See accompanying notes to consolidated financial statements.

                                        7

<PAGE>



           THE CLARIDGE HOTEL AND CASINO CORPORATION AND SUBSIDIARIES
                (Debtor-In-Possession effective August 16, 1999)
                   Notes to Consolidated Financial Statements

1.      Significant Events and Basis of Presentation

        The Corporation has experienced recurring losses and deterioration in
        its cash flow since 1996, which has affected the Corporation's ability
        to continue to meet its obligation to pay interest on its first mortgage
        notes (the "Notes"). The Corporation did not pay the interest due on
        August 2, 1999 on the Notes, and, on August 16, 1999, the Corporation
        and New Claridge filed voluntary petitions under Chapter 11 of the
        United States Bankruptcy Code (the "Bankruptcy Code") in the United
        States Bankruptcy Court for the District of New Jersey (the "Bankruptcy
        Court"). The Corporation continues to operate the business, as set forth
        in the Bankruptcy Code, under the supervision of the Bankruptcy Court,
        as a debtor-in-possession.

        Under the Bankruptcy Code, the Corporation had an exclusive period of
        120 days to file a plan of reorganization with the Bankruptcy Court,
        which would have expired on December 14, 1999. In November 1999, the
        Corporation petitioned the Bankruptcy Court for, and was granted, an
        extension of this exclusivity period to February 14, 2000; a further
        extension was subsequently granted, extending the exclusivity period to
        May 14, 2000. The Corporation has petitioned the Bankruptcy Court for an
        extension of this exclusivity period to September 15, 2000. On January
        27, 2000, the Corporation, New Claridge, and the Partnership filed a
        joint plan of reorganization and disclosure statement (the "Plan") with
        the Bankruptcy Court.

        On April 5, 2000, in response to objections raised by the trustee for
        the noteholders, the United States Trustee, and others, the Corporation,
        New Claridge, and the Partnership filed a revised plan of reorganization
        and disclosure statement (the "Amended Plan"). In summary, the Amended
        Plan, as proposed jointly by the Corporation, New Claridge, and the
        Partnership, calls for the following to occur, subject to certain
        conditions contained in the Amended Plan:

        (i)      the existing Class A Stock of the Corporation will be
                 cancelled;

        (ii)     the holders of the existing Notes will be entitled to receive,
                 on a pro rata basis, (a) 100% of the equity of the reorganized
                 Corporation outstanding on the effective date, and (b) debt, in
                 an amount not to exceed $15 million in total. The new debt
                 ("New Notes"), which will be issued by the reorganized
                 Corporation, will be guaranteed by New Claridge and secured by
                 the Hotel Assets. The New Notes will have a term of 10 years
                 and will bear interest at a rate of 8% per year;

        (iii)    the Partnership will transfer the Hotel Assets to New Claridge
                 in full satisfaction of its obligations under the Expandable
                 Wraparound Mortgage. All debts owed by New Claridge to the
                 Partnership will be forgiven, and the Partnership will
                 liquidate; and

        (iv)     the Contingent Payment and Contingent Payment Rights (see Note
                 8) would be extinguished, and the holders of the Contingent
                 Payment and Contingent Payment Rights would not receive any
                 distributions in respect of these items.

        On May 9, 2000, the adequacy of the Amended Plan was approved by the
        Bankruptcy Court, which allows for the Amended Plan to be submitted to
        the Corporation's creditors for a vote.

        The accompanying financial statements have been prepared in conformity
        with generally accepted accounting principles and in accordance with
        Statement of Position 90-7, "Financial Reporting By Entities in
        Reorganization under the Bankruptcy Code," and include disclosure of
        liabilities subject to compromise (see Note 10). The

                                        8

<PAGE>


           THE CLARIDGE HOTEL AND CASINO CORPORATION AND SUBSIDIARIES
                (Debtor-In-Possession effective August 16, 1999)
             Notes to Consolidated Financial Statements (continued)

1.      Significant Events and Basis of Presentation (continued)

        consolidated financial statements include the accounts of the
        Corporation and its wholly-owned subsidiaries, New Claridge and CGI. All
        material intercompany accounts and transactions have been eliminated in
        consolidation. The accompanying consolidated financial statements do not
        include any adjustments relating to the recoverability and
        classification of recorded asset amounts or the amounts and
        classification of liabilities that might be necessary should the
        Corporation be unable to continue as a going concern.

2.      Promotional Allowances

        The retail value of complimentary rooms, food and beverages and other
        complimentaries furnished to patrons is included in gross revenues and
        then deducted as promotional allowances. The estimated cost of providing
        such promotional allowances to casino patrons for the three months ended
        March 31, 2000 and 1999 has been charged to casino operating expenses as
        follows (in thousands):

                                                     2000                1999
                                                    ------               -----
        Hotel                                       $  992               1,018
        Food and beverage                            3,308               3,257
        Other (Entertainment)                           65                 307
                                                    ------               -----
        Total                                       $4,365               4,582
                                                    ======               =====

3.      Long-Term Receivables

        Long-term receivables consist of the following amounts due from the
Partnership:

<TABLE>
<CAPTION>
                                                                           March 31,           December 31,
                                                                             2000                1999
                                                                          ----------           ------------
                                                                                    (in thousands)
<S>                                                                      <C>                    <C>
        Expandable Wraparound Mortgage 14%,
          maturities through September 30, 2000
          (net of $2,211,000 discount at March 31, 2000
          and December 31, 1999)                                           $ 48,289                48,289
        Deferred Expandable Wraparound
          Mortgage interest receivable, due
          September 30, 2000                                                 20,000                20,000
        FF&E promissory notes, 14%                                           10,822                11,137
        Allowance for impairment                                            (37,595)              (37,595)
                                                                           --------              --------
                                                                           $ 41,516                41,831
                                                                           ========              ========
</TABLE>

        As a result of the Corporation's and New Claridge's filing for
        reorganization under Chapter 11 on August 16, 1999, as well as the
        Partnership's Chapter 11 filing on October 5, 1999, the realizable value
        of the Expandable Wraparound Mortgage has become impaired. Therefore,
        during the fourth quarter of 1999, the Corporation recorded an
        adjustment to write-down the balance of the Expandable Wraparound
        Mortgage receivable to an amount estimated to be the realizable value of
        the Hotel Assets. (As previously noted, the Plan calls for the
        Partnership to transfer the Hotel Assets to New Claridge in full
        satisfaction of its obligations under the Expandable Wraparound
        Mortgage.) The total amount of this write-down was $37.6 million.

                                        9

<PAGE>


           THE CLARIDGE HOTEL AND CASINO CORPORATION AND SUBSIDIARIES
                (Debtor-In-Possession effective August 16, 1999)
             Notes to Consolidated Financial Statements (continued)


4.      Property and Equipment

        Property and equipment consists of the following:
<TABLE>
<CAPTION>
                                                                             March 31,             December 31,
                                                                               2000                    1999
                                                                             ---------             ------------
                                                                                       (in thousands)
<S>                                                                            <C>                    <C>
        Gaming equipment                                                       $11,667                12,593
        Land and land improvements                                               7,598                 7,598
        Self-parking garage facility                                            20,070                20,070
        Leasehold improvements                                                     745                   745
        Capital lease asset                                                        822                   822
        Other furniture, fixtures, and equipment                                   690                   213
                                                                               -------               -------
                                                                                41,592                42,041
        Less accumulated depreciation and amortization                          13,014                13,699
                                                                               -------               -------

        Net property and equipment                                             $28,578                28,342
                                                                               =======               =======
</TABLE>

5.      Loan from the Partnership

        In accordance with the terms of the Restructuring Agreement, on June 16,
        1989 the Partnership loaned to New Claridge $3.6 million, which
        represented substantially all cash and cash equivalents remaining in the
        Partnership other than funds needed to pay expenses incurred through the
        closing of the restructuring. This loan is evidenced by an unsecured
        promissory note and will become payable (i) upon a sale or refinancing
        of the Claridge; (ii) upon full or partial satisfaction of the
        Expandable Wraparound Mortgage; and (iii) upon full satisfaction of any
        first mortgage then in place.

        Interest, which contractually accrues at 12% per annum, is payable in
        full upon maturity. Interest on this loan ceased to accrue as a result
        of the Corporation's filing for reorganization under Chapter 11 (see
        Note 1) on August 16, 1999. The loan and accrued interest through August
        16, 1999 of $4,392,000 are included in "Liabilities Subject to
        Compromise" (see Note 10) as of March 31, 2000 and December 31, 1999.



                                       10

<PAGE>


           THE CLARIDGE HOTEL AND CASINO CORPORATION AND SUBSIDIARIES
                (Debtor-In-Possession effective August 16, 1999)
             Notes to Consolidated Financial Statements (continued)


6.      Other Current Liabilities

        Other current liabilities consist of the following:

<TABLE>
<CAPTION>
                                                                   March 31,            December 31,
                                                                      2000                  1999
                                                                   ---------            ------------
                                                                             (in thousands)

<S>                                                                  <C>                    <C>
        Deferred rent                                                $1,025                 1,100
        Accrued payroll and related benefits                          8,719                 8,232
        Auto/general insurance reserves                                 378                   228
        Reorganization costs                                          1,887                   813
        Other current liabilities                                     4,145                 3,880
                                                                   --------              --------
                                                                    $16,154                14,253
                                                                   ========              ========
</TABLE>


        Effective September 30, 1998, the Operating Lease and Expansion
        Operating Lease were further amended, pursuant to a Sixth Amendment to
        the Operating Lease and Fifth Amendment to the Expansion Operating Lease
        (the "Sixth Amendment"). The Sixth Amendment provided for the deferral
        of $1.1 million of rent in either February 1999 or March 1999, dependent
        upon certain conditions being met. These conditions were met, and the
        $1.1 million of rent was deferred in March 1999. The $1.1 million of
        basic rent deferred is to be paid to the Partnership in monthly
        installments of $25,000 commencing January 1, 2000 until paid in full
        (subject to acceleration under certain circumstances).

        As of March 31, 2000 and December 31, 1999, deferred rent, current;
        accrued interest, First Mortgage Notes; accrued interest due to
        Partnership; and the auto and general liability reserves incurred prior
        to August 16, 1999 are included in "Liabilities Subject to Compromise"
        (see Note 10), as a result of the Corporation's filing for
        reorganization under Chapter 11 (see Note 1) on August 16, 1999.



                                       11

<PAGE>


           THE CLARIDGE HOTEL AND CASINO CORPORATION AND SUBSIDIARIES
                (Debtor-In-Possession effective August 16, 1999)
             Notes to Consolidated Financial Statements (continued)

7.      Long-Term Debt

        On January 31, 1994, the Corporation completed an offering of $85
        million of First Mortgage Notes (the "Notes") due 2002, bearing interest
        at 11 3/4%. The Notes are secured by (i) a non-recourse mortgage granted
        by the Partnership representing a first lien on the Hotel Assets; (ii) a
        pledge granted by the Corporation of all outstanding shares of capital
        stock of New Claridge; and (iii) a guarantee by New Claridge. New
        Claridge's guarantee of the Notes is secured by a collateral assignment
        of the second lien Expandable Wraparound Mortgage, and by a lien on the
        Claridge's gaming and other assets, which lien will be subordinated to
        liens that may be placed on those gaming and other assets to secure any
        future revolving credit line arrangement. On January 28, 1997, New
        Claridge entered into an agreement to subject the new self-parking
        garage to the lien of the mortgage; such lien will not be subordinated
        to any lien which may be placed on New Claridge's gaming and other
        assets to secure any future revolving credit line arrangement. Interest
        on the Notes is payable semiannually on February 1 and August 1 of each
        year. A portion of the net proceeds of $82.2 million was used to repay
        in full the then outstanding debt under the Revolving Credit and Term
        Loan Agreement (the "Loan Agreement"), including the outstanding balance
        of the Corporation's revolving credit line, which was secured by a first
        mortgage. In conjunction with the full satisfaction of the Loan
        Agreement, the Corporation's $7.5 million revolving credit line
        arrangement was terminated.

        As of March 31, 2000 and December 31, 1999, the principal amount due on
        the Notes is included in "Liabilities Subject to Compromise" (see Note
        10), as a result of the Corporation's filing for reorganization under
        Chapter 11 (see Note 1) on August 16, 1999. In addition, interest on the
        Notes ceased to accrue as of August 16, 1999. The interest payable on
        the Notes, as accrued through August 16, 1999 of $5,440,000, is also
        included in "Liabilities Subject to Compromise" (see Note 10).

8.      Other Noncurrent Liabilities

        Other noncurrent liabilities consist of the following:

                                            March 31,              December 31,
                                              2000                     1999
                                            ---------              ------------
                                                     (in thousands)
        License agreement                   $  1,275                 1,294
        Other                                    104                    60
                                            --------               -------
                                            $  1,379                 1,354
                                            ========               =======

        Pursuant to the Restructuring Agreement, Del Webb Corporation ("Webb")
        retained an interest, which was assigned to a trustee for the benefit of
        the Valley of the Sun United Way on April 2, 1990, equal to $20 million
        plus interest at a rate of 15% per annum, compounded quarterly,
        commencing December 1, 1988, in any proceeds ultimately recovered from
        operations and/or the sale or refinancing of the Claridge facility in
        excess of the first mortgage loan and other liabilities ("Contingent
        Payment"). Consequently, New Claridge has deferred the recognition of
        $20 million of forgiveness income with respect to the Contingent Payment
        obligation. Interest on the Contingent Payment has not been recorded in
        the accompanying consolidated financial statements since the likelihood
        of paying such amount is not considered probable at this time. As of
        March 31, 2000, accrued interest would have amounted to approximately
        $86.1 million.

                                       12

<PAGE>

           THE CLARIDGE HOTEL AND CASINO CORPORATION AND SUBSIDIARIES
                (Debtor-In-Possession effective August 16, 1999)
             Notes to Consolidated Financial Statements (continued)


8.      Other Noncurrent Liabilities (continued)

        In connection with the restructuring, Webb agreed to grant those
        investors in the Corporation and the Partnership ("Releasing
        Investors"), from whom Webb had received written releases from all
        liabilities, rights ("Contingent Payment Rights") to receive certain
        amounts to the extent available for application to the Contingent
        Payment. Approximately 84% in interest of the investors provided
        releases and became Releasing Investors. Payments to Releasing Investors
        are to be made in accordance with a schedule of priorities, as defined
        in the Restructuring Agreement.

        On February 23, 1996, the Corporation acquired an option to purchase, at
        a discount from the carrying value, the Contingent Payment. The purchase
        price of the option of $1 million was recorded as an offset to the
        Contingent Payment liability which had been included in other noncurrent
        liabilities on the Corporation's consolidated balance sheet. The option
        could have been exercised any time prior to December 31, 1997. Given its
        operating results, the Corporation was not able to exercise this
        Contingent Payment option, and it expired in accordance with its terms
        on December 31, 1997.

        As of March 31, 2000 and December 31, 1999, the Contingent Payment is
        included in "Liabilities Subject to Compromise" (see Note 10), as a
        result of the Corporation's filing for reorganization under Chapter 11
        (see Note 1) on August 16, 1999. As proposed under the terms of the
        Amended Plan, the Contingent Payment and the Contingent Payment Rights
        would be extinguished, and the holders of the Contingent Payment and
        Contingent Payment Rights would not receive any distributions in respect
        of these items.

        On February 28, 1997, New Claridge entered into an agreement with
        Thermal Energy Limited Partnership I ("Atlantic Thermal"), pursuant to
        which Atlantic Thermal was granted an exclusive license for a period of
        twenty years (which was subsequently extended to twenty-five years) to
        use, operate, and maintain certain steam and chilled water production
        facilities at the Claridge. In consideration for this license agreement,
        Atlantic Thermal paid New Claridge $1.5 million. This amount is being
        recognized as income over the term of the agreement, commencing April
        1997.

9.      Income Taxes

        As of March 31, 2000, the Corporation had net operating loss
        carryforwards for federal income tax purposes of approximately $48
        million; none expire before the year 2016. These net operating loss
        carryforwards are available to offset future federal taxable income, if
        any. The Corporation also has tax credit carryforwards for income tax
        purposes of approximately $940,000, which are available to reduce future
        federal income taxes, if any, through 2002. The availability of the net
        operating loss and tax credit carryforwards will be further subject to
        the tax consequences of a plan of reorganization approved by the
        Bankruptcy Court.

        During 1995, the Corporation received notice from the Internal Revenue
        Service ("IRS") asserting deficiencies in Federal corporate income taxes
        for the Corporation's 1990 and 1991 taxable years. Many of the proposed
        adjustments to the Corporation's tax returns have been settled with no
        adverse impact to the Corporation's consolidated financial statements.
        There was a remaining IRS asserted deficiency for the 1990 and 1991
        taxable years. In January 1999, the Corporation reached a settlement
        agreement with the IRS District Counsel, which was confirmed by the
        United States Tax Court on March 4, 1999. This settlement agreement did
        not have a material impact on the Corporation's consolidated financial
        statements. As of March 31, 2000 and December 31, 1999, the amount of
        this settlement, including interest, has been included in "Liabilities
        Subject to Compromise" (see Note 10), as a result of the Corporation's
        filing for reorganization under Chapter 11 (see Note 1) on August 16,
        1999.

                                       13

<PAGE>


           THE CLARIDGE HOTEL AND CASINO CORPORATION AND SUBSIDIARIES
                (Debtor-In-Possession effective August 16, 1999)
             Notes to Consolidated Financial Statements (continued)

10.     Liabilities Subject to Compromise

        Liabilities subject to compromise are subject to future adjustments
        depending on Bankruptcy Court actions and further developments with
        respect to disputed claims. Payment of these liabilities may not be made
        except pursuant to an approved plan of reorganization or under the order
        of the Bankruptcy Court while the Corporation continues to operate as
        debtor-in-possession. Liabilities subject to compromise consist of the
        following (in thousands):
<TABLE>
<CAPTION>
                                                                     March 31,            December 31,
                                                                       2000                   1999
                                                                     ---------            ------------
<S>                                                                  <C>                      <C>
        Accounts payable and accrued expenses                        $  3,152                 3,251
        11 3/4%  Notes                                                 85,000                85,000
        Accrued interest                                                9,832                 9,832
        Loan from the Partnership                                       3,600                 3,600
        Deferred rent due to the Partnership                           22,457                22,147
        Contingent Payment                                             19,000                19,000
        Auto and general liability reserves                             1,086                 1,086
        Other                                                           1,343                 1,343
                                                                     --------               -------
                                                                     $145,470               145,259
                                                                     ========               =======
</TABLE>

        Accrued interest as of March 31, 2000 and December 31, 1999 of
        $9,832,000 consists of $5,440,000 of interest due on the Notes, and
        $4,392,000 of interest due on the $3.6 million loan from the
        Partnership. Interest on both of these items ceased to accrue as of
        August 16, 1999.

11.     Claridge License Renewal

        On September 22, 1999, New Claridge was issued a one-year casino license
        by the New Jersey Casino Control Commission (the "Commission") for the
        period commencing September 30, 1999. Although New Claridge had
        reapplied for a four-year casino license, the filing of the voluntary
        petition under Chapter 11 of the United States Bankruptcy Code on August
        16, 1999 prompted the Commission to renew New Claridge's license for the
        reduced period of time. Additionally, the casino license renewal
        contains certain financial reporting conditions and requirements
        consistent with the manner in which the Commission has relicensed other
        casino licensees who have filed voluntary petitions under Chapter 11 in
        the past.



                                       14

<PAGE>


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

Results of Operations for the Three Months Ended March 31, 2000

        The Corporation had a net loss of $511,000 for the three months ended
March 31, 2000, compared to a net loss of $1,248,000 for the three months ended
March 31, 1999. Results for the first quarter of 2000 included approximately
$1.1 million of professional fees incurred as a result of the Chapter 11
proceedings. Results for the first quarter of 1999 included income from the $2.3
million settlement received by New Claridge in February 1999 as a result of the
settlement of the self-parking garage arbitration proceedings.

        Total Claridge casino revenue for the first quarter of 2000 was
$38,760,000, reflecting a 6.0% increase over the first quarter of 1999 revenues
of $36,554,000, resulting from increased slot machine revenues, as further
discussed below. Total citywide casino revenues, as reported, increased 7.2%
during the first quarter of 2000, as compared to prior year revenues.

        Claridge table games drop (the amount of gaming chips purchased by
patrons) decreased 3.4% during the first quarter of 2000, as compared to the
first quarter of 1999. In addition, the "hold" percentage (the ratio of win to
drop) decreased to 13.5% during the first quarter of 2000, compared to 14.1%
during the first quarter of 1999. As a result, Claridge table games revenue for
the first three months of 2000 of $9,230,000 was 7.6% lower than 1999 revenue of
$9,990,000. Citywide table games drop for the first quarter of 2000, as
reported, increased 6.6% over the same period of 1999. However, the citywide
hold percentage during the first quarter of 2000 decreased from the prior year
level; as a result, citywide table games revenue, as reported, increased 3.0%
over the first quarter of 1999.

        For the first three months of 2000, Claridge revenue from slot machines
totalled $29,530,000, reflecting an 11.2% increase over the first three months
of 1999. Citywide slot machine revenue, as reported, increased 9.1% during the
first quarter of 2000 as compared to the first quarter of 1999. The increase in
Claridge slot machine revenue was due in part to increased bus program volumes,
as further discussed below. In addition, the average number of slot machines
available citywide during the first quarter of 2000 declined 1.4% from the prior
year levels, primarily resulting from the closing of the Trump World's Fair
Casino during the fourth quarter of 1999; the average number of slot machines
available at the Claridge was consistent with prior year levels.

        During late 1998 and early 1999, in response to increasing citywide
competition for attracting patrons who arrive in Atlantic City by bus (and the
resulting increases in coin incentives paid to these patrons), New Claridge
reduced its bus program volumes, and increased its direct promotions for
drive-in patrons and advertising. However, during the second half of 1999, while
the drive-in promotions continued, bus program volumes began to be increased,
although coin incentives paid to bus patrons remained in line with 1998 levels.
During the first quarter of 2000, this marketing strategy continued. For the
first three months of 2000, 160,000 bus patrons arrived at the Claridge, and
were issued a total of $2,980,000 in coin incentives (for an average of $19 per
passenger). This compares to 121,000 bus patrons who arrived at the Claridge
during the first quarter of 1999, who were issued a total of $2,245,000 in coin
incentives (also an average of $19 per passenger). In addition to the bus
program, New Claridge offers promotional incentives to its customers through its
direct marketing programs, based on their levels of gaming activity. Promotional
incentives issued through this program totalled $2,050,000 during the first
quarter of 2000, compared to $2,324,000 during the first quarter of 1999.

        Hotel revenues during the first quarter of 2000 totalled $2,152,000, an
increase of 7.9% over the same period of 1999. Hotel occupancy during the first
three months of 2000 was 82.8%, lower than the 85.0% occupancy during the same
period of 1999. However, the average room rate during the first quarter of 2000
was $56, compared to $51 during the first quarter of 1999. Food and beverage
revenues increased 7.3% during the first quarter of 2000 as compared to the
prior year. The increase over 1999 was due primarily to the reductions in bus
program volumes during the first half of 1999, which resulted in the closing of
New Claridge's buffet, as

                                       15

<PAGE>


well as an increase in complimentary beverages served to casino patrons. The
increase in complimentary beverages is offset by an increase in promotional
allowances, which represent the value of goods and services provided free of
charge to casino customers under various marketing programs. During the first
quarter of 2000, the total number of covers (meals served) was 211,000, in line
with 1999 covers of 210,000; in addition, the average price per cover in the
first quarter of 2000 was $13.75, an increase over the average price per cover
in the first quarter of 1999 of $13.29. Other income for the first quarter of
1999 includes the $2.3 million received by New Claridge in February 1999 as a
result of the settlement of the self-parking garage arbitration proceedings.

        Total costs and expenses for the first quarter of 2000 were $43,596,000,
reflecting a 3.3% decrease from the same period of 1999, due primarily to lower
interest expense as a result of the Corporation's filing under Chapter 11 of the
Bankruptcy Code on August 16,1999. Casino operating expenses for the first three
months of 2000 increased 3.4% over the first quarter of 1999, primarily due to
increased coin incentives, as previously discussed. Food and beverage expenses
for the first three months of 2000 increased over the prior year levels,
primarily due to increased patron volumes. General and administrative expenses
for the first quarter of 2000 decreased from the prior year primarily due to
decreased legal fees, which in 1999 were related to the self-parking garage
arbitration proceedings.

        Reorganization items of $931,000 for the first quarter of 2000 includes
professional fees incurred as a result of the Corporation's filing for
reorganization under Chapter 11 of $1,074,000, offset by interest earned from
the investment of accumulated cash resulting from the Chapter 11 filing.

Liquidity and Capital Resources

Financial Condition

        On January 31, 1994, the Corporation completed an offering of $85
million of First Mortgage Notes (the "Notes"), due 2002, bearing interest at
11 3/4%. The Notes are secured by (i) a non-recourse mortgage granted by the
Partnership representing a first lien on the Hotel Assets; (ii) a pledge granted
by the Corporation of all outstanding shares of capital stock of New Claridge;
and (iii) a guarantee by New Claridge. New Claridge's guarantee of the Notes is
secured by a collateral assignment of the second lien Expandable Wraparound
Mortgage, and by a lien on New Claridge's gaming and other assets, which lien
will be subordinated to liens that may be placed on those gaming and other
assets to secure any future revolving credit line arrangement. On January 28,
1997, New Claridge entered into an agreement to subject the new self-parking
garage to the lien of the mortgage; such lien will not be subordinated to any
liens which may be placed on New Claridge's gaming and other assets to secure
any future revolving credit line arrangement. Interest on the Notes is payable
semiannually on February 1 and August 1 of each year.

        The net proceeds of the Notes, totalling $82.2 million, were used as
follows (i) to repay the then outstanding debt of the Corporation under the
Revolving Credit and Term Loan Agreement of approximately $35 million, including
the outstanding balance of the Corporation's revolving credit line, which was
secured by a first mortgage; (ii) to expand the casino capacity of the Claridge
by 12,000 square feet in 1994, including the addition of approximately 500 slot
machines and the relocation of two restaurants and their related kitchens, at a
cost of approximately $12.7 million; (iii) to purchase property in 1995 and
construct on that property a self-parking garage, which opened in 1996, at a
cost (excluding capitalized interest of approximately $2.2 million) of
approximately $28 million (of which approximately $7.5 million represents the
cost of acquiring the land and approximately $20.5 million represents the costs
attributable to building the garage facility); and (iv) to acquire the
Contingent Payment Option (see Note 8, "Other Noncurrent Liabilities") at a cost
of $1 million. With the completion of the construction of the self-parking
garage, the proceeds of the offering of the Notes had largely been expended.

        The Corporation has experienced recurring losses and deterioration in
its cash flow since 1996. Since the Corporation does not have substantial cash
reserves or access to a line of credit, the Corporation needed to experience

                                       16

<PAGE>



a significant improvement in operating results in 1997 over 1996 levels in order
to meet its on-going obligations, including the interest due on the Notes.
Although operating results in 1997 did improve over 1996 levels, due primarily
to the positive impact of the availability of the self-parking garage, lower bus
package pricing, and other cost containment initiatives, operating results in
1998 fell below 1997 levels due to increased citywide competition for casino
customers. In 1998, the Corporation experienced a net loss of $9.4 million,
compared to a net loss of $6.0 million in 1997.

        In view of the operating results of New Claridge in 1998, and in order
to meet its obligations, management of the Corporation took several steps to
enhance its cash position, through both operational changes, and certain
financial transactions with PDS Financial Corporation ("PDS") and the Casino
Reinvestment Development Authority ("CRDA"). In addition, in February 1999, the
Corporation and New Claridge agreed to a settlement of approximately $2.3
million in the arbitration proceedings concerning the accident which took place
in New Claridge's self-parking garage in July 1996. The settlement proceeds were
received by New Claridge in late February 1999.

        As a result of these transactions, on March 2, 1999, New Claridge was
able to pay the interest that was due on the Notes on February 1, 1999, under
the 30-day grace period allowed in accordance with the terms of the Indenture.
Operating results for the first half of 1999, however, continued to lag behind
prior year levels, which affected the Corporation's ability to continue to meet
its obligation to pay interest on the Notes. As a result, the Corporation did
not pay the interest due August 2, 1999 on the Notes and on August 16, 1999, the
Corporation and New Claridge filed voluntary petitions under Chapter 11 of the
United States Bankruptcy Code (the "Bankruptcy Code") in the United States
Bankruptcy Court for the District of New Jersey (the "Bankruptcy Court"). The
Partnership filed a voluntary petition under Chapter 11 of the Bankruptcy Code
on October 5, 1999.

        Management of the Corporation believes that this filing will permit the
Corporation to conserve its cash pending a restructuring of its financial
obligations in the Chapter 11 proceeding. As of March 31, 2000, the Corporation
had approximately $18.2 million of cash and cash equivalents, including
approximately $8.3 million of "bankroll" used in casino operations. Management
anticipates an increase in ongoing general and administrative expenses,
primarily for professional fees, during the pendency of the bankruptcy
proceeding. For the three months ended March 31, 2000, such expenses totalled
approximately $1,074,000; through December 31, 1999, such expenses totalled
$1,268,000.

        The Corporation continues to operate the business, as set forth in the
Bankruptcy Code, under the supervision of the Bankruptcy Court, as a debtor-in-
possession. As debtor-in-possession, the Corporation is authorized to operate
its business, but may not engage in transactions outside of the normal course of
business without the approval of the Bankruptcy Court. Further, the Corporation
is subject to operating within certain weekly cash budgets which have been
approved by the Bankruptcy Court pursuant to certain orders authorizing the use
of its cash. As of the petition date, actions to collect prepetition
indebtedness are stayed, and other contractual obligations may not be enforced
against the Corporation. In addition, the Corporation may reject executory
contracts and lease obligations, and parties affected by these rejections may
file claims with the Bankruptcy Court in accordance with the reorganization
process. As part of the "first day orders," the Bankruptcy Court approved the
Corporation's payment of prepetition employee compensation, benefits and
reimbursable employee expenses, as well as to continue to honor all existing
employee benefit plans and policies. In addition, the Bankruptcy Court approved
the payment of certain prepetition vendor claims, certain prepetition
guest-related claims (such as outstanding direct mail coupons, progressive
jackpots, and safekeeping deposits) and prepetition payroll, gaming and other
taxes and fees.

        While the Corporation and its subsidiaries have sustainable operations,
the cash generated by those operations are not sufficient to (i) permit the
Corporation to meet the debt service on the currently outstanding Notes; (ii) to
make significant capital improvements that management believes are necessary to
improve the Claridge's competitive position in the Atlantic City casino market;
and (iii) regularly make capital improvements in the future to maintain that
competitive position. Accordingly, management of the Corporation intends to
seek, in the Chapter 11 proceeding, to reduce the Corporation's debt obligations
to a level that it believes is consistent with the sustainable level of cash to

                                       17

<PAGE>



be generated by the Claridge. At the same time, management will seek to simplify
the ownership structure of the Claridge as between the Corporation, New Claridge
and the Partnership. Any such restructuring of the financial obligations of the
Claridge and of its ownership structure will be subject to the outcome of the
Chapter 11 proceeding and, in particular, the approval of the holders of the
requisite percentage of the outstanding Notes, as to which there can be no
assurance.

        Under the Bankruptcy Code, the Corporation had an exclusive period of
120 days to file a plan of reorganization with the Bankruptcy Court, which would
have expired on December 14, 1999. In November 1999, the Corporation petitioned
the Bankruptcy Court for, and was granted, an extension of this exclusivity
period to February 14, 2000; a further extension was subsequently granted,
extending the exclusivity period to May 14, 2000. The Corporation has petitioned
the Bankruptcy Court for an extension of this exclusivity period to September
15, 2000. On January 27, 2000, the Corporation, New Claridge, and the
Partnership filed a joint plan of reorganization and disclosure statement (the
"Plan") with the Bankruptcy Court.

        On April 5, 2000, in response to objections raised by the trustee for
the noteholders, the United States Trustee, and others, the Corporation, New
Claridge, and the Partnership filed a revised plan of reorganization and
disclosure statement (the "Amended Plan"). In summary, the Amended Plan, as
proposed jointly by the Corporation, New Claridge, and the Partnership, calls
for the following to occur, subject to certain conditions contained in the
Amended Plan:

        (i)    the existing Class A Stock of the Corporation will be cancelled;

        (ii)   the holders of the existing Notes will be entitled to receive, on
               a pro rata basis, (a) 100% of the equity of the reorganized
               Corporation outstanding on the effective date, and (b) debt, in
               an amount not to exceed $15 million in total. The new debt ("New
               Notes"), which will be issued by the reorganized Corporation,
               will be guaranteed by New Claridge and secured by the Hotel
               Assets. The New Notes will have a term of 10 years and will bear
               interest at a rate of 8% per year;

        (iii)  the Partnership will transfer the Hotel Assets to New Claridge in
               full satisfaction of its obligations under the Expandable
               Wraparound Mortgage. All debts owed by New Claridge to the
               Partnership will be forgiven, and the Partnership will liquidate;
               and

        (iv)   the Contingent Payment and Contingent Payment Rights would be
               extinguished, and the holders of the Contingent Payment and
               Contingent Payment Rights would not receive any distributions in
               respect of these items.

        On May 9, 2000, the adequacy of the Amended Plan was approved by the
Bankruptcy Court, which allows for the Amended Plan to be submitted to the
Corporation's creditors for a vote.

        The consolidated financial statements do not show (i) as to assets,
their realizable value on a liquidation basis or their availability to satisfy
liabilities; (ii) contingencies, or the status and priority thereof; or (iii) as
to stockholder accounts, the effect of any changes that may be made in the
Corporation's business. The eventual outcome of these matters is not presently
determinable.

        At March 31, 2000, the Corporation had working capital of $9,883,000 as
compared to working capital of $10,952,000 at December 31, 1999. The decrease in
working capital is principally attributable to an increase in reorganization
costs payable of $1,074,000, in accrued payroll and related benefits of
$487,000, in accounts payable of $934,000, and in other current liabilities of
$265,000, offset by increases in cash and cash equivalents of $1,318,000 and in
accounts receivable of $332,000.


                                       18

<PAGE>



        For the three months ended March 31, 2000, cash provided by operating
activities was $1,682,000, compared to $1,805,000 for the same period of 1999.
As a result of the Chapter 11 filing on August 16, 1999, the interest payment
due on the Notes on February 1, 2000 was not made; therefore, interest payments
for the three months ended March 31, 2000 were approximately $5 million lower
than in the same period of 1999. Cash provided by operating activities in 1999
was improved by the deferral of $1.1 million of basic rent payable to the
Partnership under the Operating Lease and Expansion Operating Lease, as well as
the $2.3 million received as a result of the settlement of the garage
arbitration proceedings. Cash used in investing activities for the three months
ended March 31, 2000 was $317,000, compared to $135,000 for the three months
ended March 31, 1999. Cash used in financing activities in 2000 and 1999 of
$47,000 and $95,000, respectively, represents payments of capital lease
obligations for certain gaming equipment.

        For the three months ended March 31, 2000, the Corporation's "Adjusted
EBITDA" was $417,000, compared to $2,354,000 for the same period of 1999.
"Adjusted EBITDA" for the first quarter of 1999 includes $2.3 million of income
from the settlement of the garage arbitration proceedings. "EBITDA" represents
earnings before interest expense, income taxes, depreciation, amortization, and
other non-cash items. "Adjusted EBITDA" is equal to "EBITDA" plus rent expense
to the Partnership, less interest income from the Partnership, less "Net
Partnership Payments", which represent the Corporation's net cash outflow to the
Partnership. Adjusted EBITDA is used by the Corporation to evaluate its
financial performance in comparison to other gaming companies with more
traditional financial structures. Adjusted EBITDA may be used as one measure of
the Corporation's historical ability to service its debt, but should not be
considered as an alternative to operating income (as determined in accordance
with generally accepted accounting principles) as an indicator of operating
performance, or to cash flows from operating activities (as determined in
accordance with generally accepted accounting principles) as a measure of
liquidity, or to other consolidated income or cash flow statement data, as are
determined in accordance with generally accepted accounting principles.

Relationship with the Partnership

        The Hotel Assets are owned by the Partnership and leased by the
Partnership to New Claridge under the terms of the Operating Lease originally
entered into on October 31, 1983, and the Expansion Operating Lease, which
covered the expansion improvements made to the Claridge in 1986. The initial
terms of both leases expired on September 30, 1998 and each lease provided for
three ten-year renewal options at the election of New Claridge. New Claridge
exercised the first of the ten-year renewal options, extending the term of the
Operating Lease and Expansion Operating Lease through September 30, 2008.

        Basic rent during the renewal term of each lease is calculated pursuant
to a defined formula, with such rent for the lease year commencing October 1,
1998 through September 30, 1999 not to be more than $29.5 million nor less than
$24 million for the Operating Lease, and not to be more than $3 million nor less
than $2.5 million for the Expansion Operating Lease. In addition, in each
subsequent lease year, rent will be calculated pursuant to a defined formula,
but may not exceed 10% more than the basic rent for the immediately preceding
lease year. Basic rent, as calculated pursuant to the defined formula for the
lease year commencing October 1, 1998, was $24 million for the Operating Lease
and $2.5 million for the Expansion Operating Lease, and remained the same for
the lease year which commenced October 1, 1999.

        New Claridge is also required to pay, as additional rent, certain
amounts including certain taxes, insurance, and other charges related to the
occupancy of the land and Hotel Assets, certain expenses and debt service
related to furniture, fixture and equipment replacements and building
improvements, and the general and administrative costs of the Partnership.

        The terms of the Operating Lease and Expansion Operating Lease have been
amended from time to time. The most recent amendment (the "Sixth Amendment"),
which was effective September 30, 1998, allowed for the deferral

                                       19

<PAGE>



of $1.1 million of rent in either February 1999 or March 1999, dependent upon
certain conditions being met. These conditions, which must have occurred prior
to March 2, 1999, included (i) New Claridge having received the proceeds in
connection with its settlement of the parking garage arbitration; and (ii) the
Corporation or New Claridge having paid the interest that was due on the Notes
on February 1, 1999. New Claridge received the proceeds from the settlement of
the parking garage litigation in February 1999, and paid the interest due on the
Notes on March 2, 1999, within the 30-day grace period allowed in accordance
with the terms of the Indenture. The $1.1 million of basic rent deferred in 1999
is to be paid to the Partnership in monthly installments of $25,000 commencing
January 1, 2000 until paid in full (subject to acceleration under certain
circumstances). This amendment also provides for additional abatements of rent,
through December 31, 2004, as necessary to reduce the Partnership's cash flow to
an amount necessary only to meet the Partnership's cash requirements; these
abatements, however, are to be reduced by specified amounts for each period
commencing January 1, 2000 and ending December 31, 2004 ($83,333 per month in
2000, $130,000 per month in 2001, $180,000 per month in 2002 and 2003, and
$130,000 per month in 2004).

        In addition to the deferral and abatements of rent provided for in the
Sixth Amendment, the amendment provides for the payment of $3.5 million of
additional basic rent on the earlier of (i) the maturity date of the Expandable
Wraparound Mortgage Note; (ii) such earlier date, if any, as the entire
principal amount of the Expandable Wraparound Mortgage becomes due and payable;
or (iii) the date on which any merger, consolidation, or similar transaction to
which the Corporation or New Claridge is a party, or any sale of all or
substantially all of the assets of the Corporation or New Claridge is
consummated, or any change in control of the Corporation or New Claridge occurs.

        If the Partnership should fail to make any payment due under the
Expandable Wraparound Mortgage, New Claridge may exercise a right of offset
against rent or other payments due under the Operating Lease and Expansion
Operating Lease to the extent of any such deficiency. As a result of the
Corporation and New Claridge's Chapter 11 filing on August 16, 1999, under the
terms of the indenture governing the Notes (the "Indenture"), an "Event of
Default" has occurred (as defined in the Indenture). As a result of this Event
of Default, the Corporation and New Claridge are precluded from receiving any
further payments of principal or interest on the Expandable Wraparound Mortgage.
As a result, the Corporation and New Claridge have exercised this right of
offset against rental payments required to be made subsequent to August 16,
1999.

        Prior to August 16, 1999, New Claridge was obligated under its Operating
Lease with the Partnership to lend the Partnership, at an annual interest rate
of 14%, any amounts necessary to fund the cost of furniture, fixtures and
equipment replacements. The Expandable Wraparound Mortgage, granted by the
Partnership to New Claridge, by its terms may secure up to $25 million of
additional loans to the Partnership from New Claridge to finance the
replacements of furniture, fixtures and equipment and facility maintenance and
engineering shortfalls. The advances to the Partnership were in the form of FF&E
Loans and are secured by the Hotel Assets. One half of the FF&E Loan principal
is due in the 48th month following the advance, with the remaining balance due
in the 60th month following the date of issuance. In connection with the
offering of $85 million of the Notes on January 31, 1994, the Corporation agreed
to use not less than $8 million from the net proceeds of the offering to finance
internal improvements to the Claridge, which were funded through additional FF&E
Loans. In connection therewith, the Expandable Wraparound Mortgage Loan
agreement as well as the Operating Lease, and the Expansion Operating Lease were
amended to provide that the principal on these additional FF&E Loans will be
payable at final maturity of the Expandable Wraparound Mortgage. New Claridge is
to pay, as additional rent to the Partnership, the debt service on the FF&E
Loans.

        As a result of the Corporation and New Claridge's Chapter 11 filing on
August 16, 1999, and the Partnership's Chapter 11 filing on October 5, 1999, the
Partnership no longer provides furniture, fixture, and equipment replacements to
the Claridge; rather, New Claridge has begun to provide such replacements.

        The Expandable Wraparound Mortgage required monthly principal payments
to be made by the Partnership to New Claridge, commencing in the year 1988 and
continuing through the year 1998, in escalating amounts totaling $80

                                       20

<PAGE>



million. The Expandable Wraparound Mortgage bears interest at an annual rate
equal to 14% with the deferral until maturity of $20 million of certain interest
payments which accrued between 1983 and 1988. In addition, in 1986 the principal
amount secured by the Expandable Wraparound Mortgage was increased to provide
the Partnership with funding for the construction of an expansion improvement,
which resulted in approximately 10,000 square feet of additional casino space
and a 3,600 square foot lounge. Effective August 28, 1986, the Partnership
commenced making level monthly payments of principal and interest calculated to
provide for the repayment in full of the principal balance of this increase in
the Expandable Wraparound Mortgage by September 30, 1998. Under the terms of the
Expandable Wraparound Mortgage, New Claridge is not permitted to foreclose on
the Expandable Wraparound Mortgage and take ownership of the Hotel Assets so
long as a senior mortgage is outstanding.

        The Expandable Wraparound Mortgage has been amended from time to time.
In the most recent amendment, which was effective September 30, 1998, the
Corporation, New Claridge, and the Partnership agreed to amend the March 1997
restructuring agreement to provide for an extension of the maturity date of the
Expandable Wraparound Mortgage to January 1, 2005. In addition, the Expandable
Wraparound Mortgage Agreement and Note were amended to defer the principal
payments which were payable during the fourth quarter of 1998 (totalling $3.5
million) to the earlier of (i) the maturity date of the Expandable Wraparound
Mortgage Agreement and Note; (ii) such earlier date, if any, as the entire
principal amount of the Expandable Wraparound Mortgage becomes due and payable;
or (iii) the date on which any merger, consolidation or similar transaction to
which the Corporation or New Claridge is a party, or any sale of all or
substantially all of the assets of the Corporation or New Claridge is
consummated, or any change of control of the Corporation or New Claridge,
occurs.

        As a result of the Corporation's filing for reorganization under Chapter
11 on August 16, 1999, as well as the Partnership's Chapter 11 filing on October
5, 1999, the realizable value of the Expandable Wraparound Mortgage has become
impaired. Therefore, during the fourth quarter of 1999 the Corporation recorded
an adjustment to write-down the balance of the Expandable Wraparound Mortgage
receivable, to an amount estimated to be the realizable value of the Hotel
Assets. The total amount of this write-down was $37.6 million.





                                       21

<PAGE>



                           PART II. OTHER INFORMATION




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

(a)            Exhibits filed as part of the report.

        2(a)       First Amended Joint Chapter 11 Plan of Reorganization of The
                   Claridge Hotel and Casino Corporation, The Claridge at Park
                   Place, Incorporated, and Atlantic City Boardwalk Associates,
                   L.P.

        99(a)      First Amended Disclosure Statement Pursuant to 11 U.S.C. 1125
                   on Debtors' Joint Plan of Reorganization under Chapter 11 of
                   the Bankruptcy Code.

(b)            The Corporation filed no reports on Form 8-K during the quarter
               ended March 31, 2000.



                                       22

<PAGE>



                                   SIGNATURES



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


The Claridge Hotel and Casino Corporation
-----------------------------------------
            (Registrant)





By:/s/ Jean I. Abbott
   ------------------------------------------
         Jean I. Abbott
         Executive Vice President of Finance/
         Chief Financial Officer
         (Authorized Officer, Principal Financial Officer
           and Principal Accounting Officer)



Dated: May 12, 2000






                                       23


<PAGE>



                                INDEX TO EXHIBITS




Exhibit
-------

EX 2 (a)          First Amended Joint Chapter 11 Plan of Reorganization of The
                  Claridge Hotel and Casino Corporation. The Claridge at Park
                  Place, Incorporated, and Atlantic City Boardwalk Associates,
                  L.P.


EX 99 (a)         First Amended Disclosure Statement Pursuant to 11 U.S.C. 1125
                  on Debtors' Joint Plan of Reorganization under Chapter 11 of
                  the Bankruptcy Code.