##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended March 31, 2002
 
Commission file number: 0-26518

FITZGERALDS GAMING CORPORATION

(Exact name of registrant as specified in its charter)


|                                                                       |  |                                     
|---------------------------------------------------------------------- |  | ------------------------------------
|Nevada                                                                 |  | 88-0329170                          
|(State or other jurisdiction of incorporation
        or organization) |  | (IRS Employer Identification Number)

3097 E. Warm Springs Rd., Suite
100, Las Vegas, NV 89120
(Address of principal executive offices) (Zip Code)

(702) 940-2000
(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 (or for such shorter period than 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 o

Shares outstanding of each of the registrants classes of common stock as of
May 13, 2002

|                             |  |                               
|---------------------------- |  | ------------------------------
|Class                        |  | Outstanding as of
May 13, 2002
|Common stock, $.01 par value |  | 5,508,082                     



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TABLE OF CONTENTS



|                             |                                                                                              |                                                                |  |  |  |  |  | 
|---------------------------- | -------------------------------------------------------------------------------------------- | -------------------------------------------------------------- |  |  |  |  |  | 
|PART I FINANCIAL INFORMATION
|                             | Item 1 Condensed Consolidated Financial Statements                                          
|                             |                                                                                              | Condensed Consolidated Balance Sheets                         
|                             |                                                                                              | Unaudited Condensed Consolidated Statements of Operations     
|                             |                                                                                              | Unaudited Condensed Consolidated Statements of Cash Flows     
|                             |                                                                                              | Unaudited Notes to Condensed Consolidated Financial Statements
|                             | Item 2 Managements Discussion and Analysis of Financial Condition and Results of Operations
|                             | Item 3 Quantitative and Qualitative Disclosures About Market Risk                           
|PART II OTHER INFORMATION   
|SIGNATURES                  



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FITZGERALDS GAMING CORPORATION
 FORM 10-Q
 INDEX

|        |                                                                                                                   |                                                                                       |    |   
|------- | ----------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------- | -- | --
|PART I  | FINANCIAL INFORMATION                                                                                            
|       
|        | Item 1                                                                                                            | CONDENSED CONSOLIDATED FINANCIAL STATEMENTS                                           |   
|       
|        | (Unaudited) Condensed Consolidated Balance
        Sheets as of March 31, 2002 and December 31, 2001              |                                                                                       | 4 
|       
|        | Unaudited Condensed Consolidated Statements of
Operations for the Quarters Ended March 31, 2002 and April 1, 2001 |                                                                                       | 6 
|       
|        | Unaudited Condensed Consolidated Statements of
Cash Flows for the Quarters Ended March 31, 2002 and April 1, 2001 |                                                                                       | 7 
|       
|        | Unaudited Notes to Condensed Consolidated
Financial Statements                                                    |                                                                                       | 8 
|       
|        | Item 2                                                                                                            | Managements Discussion and Analysis of Financial
Condition and Results of Operations |    | 15
|       
|        | Item 3                                                                                                            | Quantitative and Qualitative Disclosures About
Market Risk                            |    | 24
|       
|PART II | OTHER INFORMATION                                                                                                 |                                                                                       | 25
|       
|        | SIGNATURES                                                                                                        |                                                                                       | 29



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##### Table of Contents






PART I
FINANCIAL INFORMATION




Item 1
Condensed Consolidated Financial Statements



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##### Table of Contents






FITZGERALDS GAMING CORPORATION (Debtor-In-Possession)
(Unaudited) Condensed Consolidated Balance Sheets
March 31, 2002 and December 31, 2001

---

|                            |                                                                                    |                |                      |               |           |            |            |            |           |            | 
|--------------------------- | ---------------------------------------------------------------------------------- | -------------- | -------------------- | ------------- | --------- | ---------- | ---------- | ---------- | --------- | ---------- | 
|ASSETS                      |                                                                                    | March 31, 2002 |                      | Dec. 31, 2001
|                            |                                                                                    |                |                      |              
|CURRENT ASSETS:             |                                                                                    |                |                      |               |           |            |            |           
|                            | Cash and cash equivalents                                                          |                | $                    | 24,274,783    |           |            | $          | 25,609,012 |          
|                            | Accounts receivable, net of allowance for doubtful
accounts of $51,560 and $49,000 |                |                      | 433,860       |           |            |            | 455,759    |          
|                            | Inventories                                                                        |                |                      | 417,037       |           |            |            | 493,020    |          
|                            | Prepaid expenses:                                                                  |                |                      |               |           |            |            |            |          
|                            |                                                                                    | Gaming taxes   |                      |               | 1,086,202 |            |            |            | 1,316,804 |           
|                            |                                                                                    | Other          |                      |               | 949,876   |            |            |            | 1,628,389 |           
|                            |                                                                                    |                |                      |               |           |            |            |           
|                            |                                                                                    |                | Total current assets |               |           | 27,161,758 |            |            |           | 29,502,984 | 
|                            |                                                                                    |                |                      |               |           |            |            |           
|PROPERTY AND EQUIPMENT, net |                                                                                    |                | 82,940               |               |           |            | 55,397     |           
|                            |                                                                                    |                |                      |               |           |            |            |           
|OTHER ASSETS:               |                                                                                    |                |                      |               |           |            |            |           
|                            | Net assets held for sale                                                           |                |                      | 12,158,432    |           |            |            | 12,000,000 |          
|                            | Restricted cash                                                                    |                |                      | 7,828,566     |           |            |            | 8,184,732  |          
|                            | Other assets                                                                       |                |                      | 1,691,076     |           |            |            | 1,629,020  |          
|                            |                                                                                    |                |                      |               |           |            |            |           
|                            |                                                                                    |                | Total other assets   |               |           | 21,678,074 |            |            |           | 21,813,752 | 
|                            |                                                                                    |                |                      |               |           |            |            |           
|TOTAL                       |                                                                                    | $              | 48,922,772           |               |           | $          | 51,372,133 |           
|                            |                                                                                    |                |                      |               |           |            |            |           

(continued)

See Unaudited Notes to Condensed Consolidated Financial Statements



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FITZGERALDS GAMING CORPORATION (Debtor-In-Possession)
(Unaudited) Condensed Consolidated Balance Sheets (continued)
March 31, 2002 and December 31, 2001

|                                         |                                                                                                                                                                                                                                                                                                                           |                              |                                             |               |           |              |            |              |           |              |  
|---------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------- | ------------------------------------------- | ------------- | --------- | ------------ | ---------- | ------------ | --------- | ------------ | -
|LIABILITIES AND STOCKHOLDERS' DEFICIENCY |                                                                                                                                                                                                                                                                                                                           | March 31, 2002               |                                             | Dec. 31, 2001
|                                         |                                                                                                                                                                                                                                                                                                                           |                              |                                             |              
|LIABILITIES NOT SUBJECT TO COMPROMISE    |                                                                                                                                                                                                                                                                                                                           |                              |                                             |               |           |              |            |             
|CURRENT LIABILITIES:                     |                                                                                                                                                                                                                                                                                                                           |                              |                                             |               |           |              |            |             
|                                         | Current portion of long-term debt                                                                                                                                                                                                                                                                                         |                              | $                                           | 246,900       |           |              | $          | 110,791      |          
|                                         | Accounts payable                                                                                                                                                                                                                                                                                                          |                              |                                             | 1,300,003     |           |              |            | 1,248,228    |          
|                                         | Accrued and other:                                                                                                                                                                                                                                                                                                        |                              |                                             |               |           |              |            |              |          
|                                         |                                                                                                                                                                                                                                                                                                                           | Payroll and related          |                                             |               | 1,862,478 |              |            |              | 2,567,982 |             
|                                         |                                                                                                                                                                                                                                                                                                                           | Progressive jackpots         |                                             |               | 62,193    |              |            |              | 73,458    |             
|                                         |                                                                                                                                                                                                                                                                                                                           | Outstanding chips and tokens |                                             |               | 133,589   |              |            |              | 170,835   |             
|                                         |                                                                                                                                                                                                                                                                                                                           | Other                        |                                             |               | 675,097   |              |            |              | 638,193   |             
|                                         | Due to Majestic                                                                                                                                                                                                                                                                                                           |                              |                                             |               | 4,071,641 |              |            |              | 3,812,945 |             
|                                         |                                                                                                                                                                                                                                                                                                                           |                              |                                             |               |           |              |            |             
|                                         |                                                                                                                                                                                                                                                                                                                           |                              | Total current liabilities                   |               |           | 8,351,901    |            |              |           | 8,622,432    |  
|LONG-TERM DEBT, net of current portion   |                                                                                                                                                                                                                                                                                                                           |                              | 2,266,191                                   |               |           |              | 2,295,588  |             
|                                         |                                                                                                                                                                                                                                                                                                                           |                              |                                             |               |           |              |            |             
|                                         |                                                                                                                                                                                                                                                                                                                           |                              | Total liabilities not subject to compromise |               |           | 10,618,092   |            |              |           | 10,918,020   |  
|LIABILITIES SUBJECT TO COMPROMISE        |                                                                                                                                                                                                                                                                                                                           |                              | 97,466,886                                  |               |           |              | 97,335,321 |             
|                                         |                                                                                                                                                                                                                                                                                                                           |                              |                                             |               |           |              |            |             
|                                         |                                                                                                                                                                                                                                                                                                                           |                              | Total liabilities                           |               |           | 108,084,978  |            |              |           | 108,253,341  |  
|                                         |                                                                                                                                                                                                                                                                                                                           |                              |                                             |               |           |              |            |             
|CUMULATIVE REDEEMABLE PREFERRED STOCK,   |                                                                                                                                                                                                                                                                                                                           |                              |                                             |               |           |              |            |             
|                                         | $.01 par value; $25 stated value; 800,000 shares authorized,
issued and outstanding; liquidation preference $20,000,000
stated value plus accrued dividends of $30,454,359 and
$28,630,707 recorded at liquidation preference, net of
unamortized offering costs and discount of $4,507,511
and $4,728,546, respectively. |                              |                                             | 45,946,848    |           |              |            | 43,902,161   |          
|                                         |                                                                                                                                                                                                                                                                                                                           |                              |                                             |               |           |              |            |             
|STOCKHOLDERS DEFICIENCY:                |                                                                                                                                                                                                                                                                                                                           |                              |                                             |               |           |              |            |             
|                                         | Common stock, $.01 par value; 29,200,000 shares
authorized; 5,508,082 shares issued and outstanding                                                                                                                                                                                                                       |                              |                                             | 55,080        |           |              |            | 55,080       |          
|                                         | Additional paid-in capital                                                                                                                                                                                                                                                                                                |                              |                                             | 23,675,511    |           |              |            | 23,675,511   |          
|                                         | Accumulated deficit                                                                                                                                                                                                                                                                                                       |                              |                                             | (128,839,645  | )         |              |            | (124,513,960 | )        
|                                         |                                                                                                                                                                                                                                                                                                                           |                              |                                             |               |           |              |            |             
|                                         |                                                                                                                                                                                                                                                                                                                           |                              | Total stockholders deficiency              |               |           | (105,109,054 | )          |              |           | (100,783,369 | )
|                                         |                                                                                                                                                                                                                                                                                                                           |                              |                                             |               |           |              |            |             
|TOTAL                                    |                                                                                                                                                                                                                                                                                                                           | $                            | 48,922,772                                  |               |           | $            | 51,372,133 |             
|                                         |                                                                                                                                                                                                                                                                                                                           |                              |                                             |               |           |              |            |             

See Unaudited Notes to Condensed Consolidated Financial Statements



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FITZGERALDS GAMING CORPORATION (Debtor-In-Possession)
Unaudited Condensed Consolidated Statements of Operations
For the Quarters Ended March 31, 2002 and April 1, 2001

|                                                    |                                                                                                       |       |            |                |            |               |            |            |            | 
|--------------------------------------------------- | ----------------------------------------------------------------------------------------------------- | ----- | ---------- | -------------- | ---------- | ------------- | ---------- | ---------- | ---------- | 
|                                                    |                                                                                                       |       |            | March 31, 2002 |            | April 1, 2001
|                                                    |                                                                                                       |       |            |                |            |              
|OPERATING REVENUES:                                 |                                                                                                       |       |            |                |            |               |            |           
|                                                    | Casino                                                                                                |       | $          | 6,915,177      |            |               | $          | 47,990,143 |           
|                                                    | Food and beverage                                                                                     |       |            | 1,330,207      |            |               |            | 6,490,920  |           
|                                                    | Rooms                                                                                                 |       |            | 1,016,834      |            |               |            | 5,341,657  |           
|                                                    | Other                                                                                                 |       |            | 206,353        |            |               |            | 1,262,994  |           
|                                                    |                                                                                                       |       |            |                |            |               |            |           
|                                                    |                                                                                                       | Total |            |                | 9,468,571  |               |            |            | 61,085,714 | 
|                                                    | Less promotional allowances                                                                           |       |            | 1,194,399      |            |               |            | 8,956,237  |           
|                                                    |                                                                                                       |       |            |                |            |               |            |           
|                                                    |                                                                                                       | Net   |            |                | 8,274,172  |               |            |            | 52,129,477 | 
|                                                    |                                                                                                       |       |            |                |            |               |            |           
|OPERATING COSTS AND EXPENSES:                       |                                                                                                       |       |            |                |            |               |            |           
|                                                    | Casino                                                                                                |       |            | 3,798,543      |            |               |            | 22,088,085 |           
|                                                    | Food and beverage                                                                                     |       |            | 894,740        |            |               |            | 3,779,118  |           
|                                                    | Rooms                                                                                                 |       |            | 425,220        |            |               |            | 3,233,168  |           
|                                                    | Other operating expense                                                                               |       |            | 87,974         |            |               |            | 503,121    |           
|                                                    | Selling, general and administrative                                                                   |       |            | 4,333,573      |            |               |            | 14,070,237 |           
|                                                    | Depreciation and amortization                                                                         |       |            | 8,465          |            |               |            | 11,547     |           
|                                                    | Reorganization items                                                                                  |       |            | 695,112        |            |               |            | 682,028    |           
|                                                    |                                                                                                       |       |            |                |            |               |            |           
|                                                    |                                                                                                       | Total |            |                | 10,243,627 |               |            |            | 44,367,304 | 
|                                                    |                                                                                                       |       |            |                |            |               |            |           
|INCOME (LOSS) FROM OPERATIONS                       |                                                                                                       |       | (1,969,455 | )              |            |               | 7,762,173  |           
|OTHER INCOME (EXPENSE):                             |                                                                                                       |       |            |                |            |               |            |           
|                                                    | Interest income                                                                                       |       |            | 18,699         |            |               |            | 45,992     |           
|                                                    | Interest expense (Contractual interest for 2002 and 2001
was $5,827,316 and $8,883,471, respectively) |       |            | (329,636       | )          |               |            | (507,889   | )         
|                                                    | Other income (expense)                                                                                |       |            | (606           | )          |               |            | 4,276      |           
|                                                    |                                                                                                       |       |            |                |            |               |            |           
|NET INCOME (LOSS)                                   |                                                                                                       |       | (2,280,998 | )              |            |               | 7,304,552  |           
|PREFERRED STOCK DIVIDENDS AND ACCRETION OF DISCOUNT |                                                                                                       |       | (2,044,687 | )              |            |               | (1,773,714 | )         
|                                                    |                                                                                                       |       |            |                |            |               |            |           
|NET INCOME (LOSS) APPLICABLE TO COMMON STOCKHOLDERS |                                                                                                       | $     | (4,325,685 | )              |            | $             | 5,530,838  |           
|                                                    |                                                                                                       |       |            |                |            |               |            |           
|EARNINGS (LOSS) PER COMMON SHARE                    |                                                                                                       | $     | (0.79      | )              |            | $             | 1.00       |           
|                                                    |                                                                                                       |       |            |                |            |               |            |           
|WEIGHTED AVERAGE COMMON SHARES OUTSTANDING          |                                                                                                       |       | 5,508,082  |                |            |               | 5,508,082  |           
|                                                    |                                                                                                       |       |            |                |            |               |            |           

See Unaudited Notes to Condensed Consolidated Financial Statements



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FITZGERALDS GAMING CORPORATION (Debtor-In-Possession)
Unaudited Condensed Consolidated Statements of Cash Flows
For the Quarters Ended March 31, 2002 and April 1, 2001

|                                                                                    |                                       |   |                |         |               |   |             |          |  
|----------------------------------------------------------------------------------- | ------------------------------------- | - | -------------- | ------- | ------------- | - | ----------- | -------- | -
|                                                                                    |                                       |   | March 31, 2002 |         | April 1, 2001
|                                                                                    |                                       |   |                |         |              
|NET CASH PROVIDED BY (USED IN) OPERATING
ACTIVITIES                                 |                                       | $ | (1,245,895     | )       |               | $ | 9,265,178   |         
|                                                                                    |                                       |   |                |         |               |   |             |         
|CASH FLOWS FROM INVESTING ACTIVITIES:                                               |                                       |   |                |         |               |   |             |         
|                                                                                    | Proceeds from sale of assets          |   |                |        |               |   |             | 3,899    |  
|                                                                                    | Acquisition of property and equipment |   |                | (47,778 | )             |   |             | (454,911 | )
|                                                                                    | Increase in restricted cash           |   |                |        |               |   |             | (350,822 | )
|                                                                                    |                                       |   |                |         |               |   |             |         
|                                                                                    | Net cash used in investing activities |   |                | (47,778 | )             |   |             | (801,834 | )
|                                                                                    |                                       |   |                |         |               |   |             |         
|CASH FLOWS FROM FINANCING ACTIVITIES:                                               |                                       |   |                |         |               |   |             |         
|                                                                                    | Repayment of long-term debt           |   |                | (40,556 | )             |   |             | (113,455 | )
|                                                                                    |                                       |   |                |         |               |   |             |         
|                                                                                    | Net cash used in financing activities |   |                | (40,556 | )             |   |             | (113,455 | )
|                                                                                    |                                       |   |                |         |               |   |             |         
|NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS                                |                                       |   | (1,334,229     | )       |               |   | 8,349,889   |         
|CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                      |                                       |   | 25,609,012     |         |               |   | 8,181,388   |         
|CASH AND CASH EQUIVALENTS INCLUDED IN NET ASSETS
HELD FOR SALE, BEGINNING OF PERIOD |                                       |   |               |         |               |   | 10,111,872  |         
|CASH AND CASH EQUIVALENTS INCLUDED IN NET ASSETS
HELD FOR SALE, END OF PERIOD       |                                       |   |               |         |               |   | (10,101,942 | )       
|                                                                                    |                                       |   |                |         |               |   |             |         
|CASH AND CASH EQUIVALENTS, END OF PERIOD                                            |                                       | $ | 24,274,783     |         |               | $ | 16,541,207  |         
|                                                                                    |                                       |   |                |         |               |   |             |         
|CASH PAID FOR INTEREST                                                              |                                       | $ | 59,621         |         |               | $ | 76,691      |         
|                                                                                    |                                       |   |                |         |               |   |             |         
|SUMMARY OF NON-CASH INVESTING AND FINANCING ACTIVITIES:                             |                                       |   |                |         |               |   |             |         
|Property and equipment acquired through issuance of debt                            |                                       | $ | 147,268        |         |               | $ |            |         
|Accretion of discount on preferred stock                                            |                                       |   | 221,035        |         |               |   | 199,770     |         

See Unaudited Notes to Condensed Consolidated Financial Statements



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Fitzgeralds Gaming Corporation (Debtor-In-Possession)
 Unaudited Notes to Condensed Consolidated Financial Statements

1.   BASIS OF PRESENTATION

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The accompanying condensed consolidated financial statements of Fitzgeralds
Gaming Corporation (the Company) (Debtor-In-Possession) as of March 31,
2002 and for the quarters ended March 31, 2002 and April 1, 2001 have been
prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Accordingly, certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles (GAAP) have been condensed or omitted.

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In the opinion of management, all adjustments, consisting only of normal
recurring adjustments, necessary for a fair presentation of the interim
condensed consolidated financial statements have been included. These
condensed consolidated financial statements should be read in conjunction
with the consolidated financial statements and notes thereto included in the
Companys Annual Report on Form 10-K for the year ended December 31, 2001.
The results of operations for the quarter ended March 31, 2002 are not
necessarily indicative of the results to be expected for the year ending
December 31, 2002.

| |                                                                                                                                                                                                                                                                                                                                                                                                                       
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Company utilizes a 4-4-5 (weeks) financial reporting period which
maintains a December 31 year end. This method of reporting results in 13
weeks in each quarterly accounting period. The first and fourth accounting
periods will have a fluctuating number of days resulting from the
maintenance of a December 31 year end, whereas the second and third periods
will have the same number of days each year.

| |                                                                                                                                              
| | ---------------------------------------------------------------------------------------------------------------------------------------------
| | Certain amounts in the 2001 condensed consolidated financial statements have
been reclassified to conform to the 2002 method of presentation.

2.   PETITION FOR RELIEF UNDER CHAPTER 11

General

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | On December 5, 2000, the Company commenced cases under Chapter 11 of the
Bankruptcy Code (collectively, the Bankruptcy Cases) in the United States
Bankruptcy Court for the Northern District of Nevada (the Bankruptcy
Court). The Bankruptcy Cases are jointly administered and coordinated
under Case No. BK-N-00-33467 GWZ. The Bankruptcy Cases were commenced in
accordance with an Agreement Regarding Pre-Negotiated Restructuring, dated
as of December 1, 2000 (the Restructuring Agreement), with the holders
(the Consenting Noteholders) of a majority in interest of the Companys
Notes issued under an indenture dated December 30, 1997 (the Indenture).
The Restructuring Agreement



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| |                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------
| | contemplates an expeditious and orderly sale of all of the Companys
operating assets and properties as going concerns.

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Restructuring Agreement provides a vehicle for liquidating the assets of
the Company in the Bankruptcy Court through Chapter 11 of the Bankruptcy
Code. Upon execution of the Restructuring Agreement and before commencement
of the Bankruptcy Cases, the Company distributed $13.0 million in Excess
Cash (as that term is defined in the Restructuring Agreement) to the trustee
under the Indenture (the Indenture Trustee) to be applied to unpaid and
accrued Indenture Trustees fees and expenses incurred and as partial
payment of accrued and unpaid interest and principal as provided in the
Indenture.

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Pursuant to the Restructuring Agreement and an order entered by the
Bankruptcy Court, the Company was required to distribute unrestricted cash
(which includes cash in net assets held for sale) in excess of $24.8 million
to holders of its Notes within 45 days after the end of each quarter. In
May, August and November 2001, the Company distributed $1.8 million, $7.7
million and $7.2 million, respectively, in Excess Cash to the Indenture
Trustee to be applied to accrued and unpaid interest and principal as
provided in the Indenture. On December 6, 2001, the Company sold
substantially all of the assets and related liabilities of its Fitzgeralds
Las Vegas, Fitzgeralds Mississippi and Fitzgeralds Black Hawk properties to
Majestic Investors Holding, LLC (Majestic). At that time, approximately
$133.3 million was distributed to the Indenture Trustee from the proceeds of
the December 6, 2001 sale to Majestic. The Company and the Informal
Committee are currently engaged in discussions to establish a new threshold
for cash reserves subsequent to the December 6, 2001 sale to Majestic. As
part of the Restructuring Agreement, the Consenting Noteholders and
Indenture Trustee agree to forbear from exercising certain of their rights
otherwise allowable under the Notes and the Indenture.

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | As of the commencement of the Bankruptcy Cases, the parties to the
Restructuring Agreement each concluded that the fair market value of the
Companys real and personal property given as collateral for the Notes was
less than the total outstanding principal and interest due under the Notes,
and that the fair market value of the real and personal property not
securing the Notes was less than the amount of the unsecured deficiency
claim of the holders of the Notes. As a result, it was not then and is
still not expected that any distribution will be made to holders of the
existing capital stock of the Company. The Restructuring Agreement requires
that as part of the liquidation process, all of the existing common stock
and preferred stock of the Company is to be canceled and extinguished
without payment therefor.

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In accordance with the Restructuring Agreement, an auction sale was to be
scheduled for no later than June 15, 2001 in the Bankruptcy Court with
respect to those operating assets and properties not sold pursuant to
negotiated sales agreements such as the purchase agreement with Majestic, as
referred to below. With the consent of the Consenting Noteholders, the
auction sale was not conducted and the Company and the Consenting
Noteholders are preparing an amendment to the Restructuring Agreement to
conduct the auction sale of the one remaining operating asset, Fitzgeralds
Reno, during 2002.



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| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Under the terms of the Restructuring Agreement, upon the closing of each
sale of the Companys assets, the net proceeds of the collateral for the
Notes, less certain reserves for management incentives and other
liabilities, must be distributed to the Indenture Trustee for the benefit of
and distribution to the holders of the Notes in accordance with the
Indenture. All of the Companys assets remaining after such sales,
including any notes received as part of the consideration for the sales of
the Companys assets and payment of remaining liabilities of the Company,
will be transferred to a liquidating trust created for the benefit of the
holders of the Notes and others under a plan of reorganization to be
consistent with the terms of the Restructuring Agreement.

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In light of the regulatory approvals needed to accomplish the liquidations,
and recognizing the need to retain senior management in order to insure
continuity and compliance with all gaming regulations and licensing
requirements in the Companys operations during the process, the
Restructuring Agreement required implementation of a senior management
incentive and retention program. After obtaining Bankruptcy Court approval
in December 2000, this program was adopted by the Company in order to retain
Philip D. Griffith, Michael E. McPherson, Max L. Page and Paul H. Manske,
(the Senior Management) each an officer, director and/or senior executive
of the Company, as key executives and to compensate them for their continued
employment with the Company during the process.

| |                                                                                                                                                                                       
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | For further information concerning the sale to Majestic, please refer to our
Current Report on Form 8-K, dated December 6, 2001, as filed with the
Securities and Exchange Commission.

Reorganization Items

| |                                                                                                                                     
| | ------------------------------------------------------------------------------------------------------------------------------------
| | As of March 1, 2002 and April 1, 2001, the Company incurred the following
expenses subsequent to the filing of the Bankruptcy Cases:

|                                                                              |  |      |         |      |  |   |         |  
|----------------------------------------------------------------------------- |  | ---- | ------- | ---- |  | - | ------- | -
|Reorganization items:                                                         |  | 2002 |         | 2001
|                                                                              |  |      |         |     
|Post-petition professional fees                                               |  | $    | 437,250 |      |  | $ | 698,511 |  
|U. S. trustee fees                                                            |  |      | 31,250  |      |  |   | 71,801  |  
|Loss on sale of assets                                                        |  |      | 290,703 |      |  |   |        |  
|Interest earned on accumulated cash resulting
from the bankruptcy proceedings |  |      | (64,091 | )    |  |   | (88,284 | )
|                                                                              |  |      |         |      |  |   |         |  
|                                                                              |  | $    | 695,112 |      |  | $ | 682,028 |  
|                                                                              |  |      |         |      |  |   |         |  



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Liabilities Subject to Compromise

| |                                                                                                      
| | -----------------------------------------------------------------------------------------------------
| | At March 31, 2002 and December 31, 2001 liabilities subject to compromise
consisted of the following:

|                                   |  |      |            |      |  |   |            |  
|---------------------------------- |  | ---- | ---------- | ---- |  | - | ---------- | -
|Liabilities subject to compromise: |  | 2002 |            | 2001
|                                   |  |      |            |     
|Notes                              |  | $    | 99,733,642 |      |  | $ | 99,733,642 |  
|Discount on the Notes              |  |      | (526,107   | )    |  |   | (613,709   | )
|Accrued interest on the Notes      |  |      |           |      |  |   |           |  
|Debt offering costs on the Notes   |  |      | (1,878,466 | )    |  |   | (2,054,572 | )
|Unsecured creditors                |  |      | 137,817    |      |  |   | 269,960    |  
|                                   |  |      |            |      |  |   |            |  
|                                   |  | $    | 97,466,886 |      |  | $ | 97,335,321 |  
|                                   |  |      |            |      |  |   |            |  

3.   Recently Issued Accounting Standards

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In June 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 141 (SFAS 141), Business
Combinations, which requires the purchase method of accounting for business
combinations initiated after June 30, 2001 and prohibits the use of the
pooling-of-interest method. Adoption of this statement did not have a
material impact on its financial condition or results of operation.

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In June 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 142 (SFAS 142) Goodwill
and Other Intangible Assets,which is effective January 1, 2002. SFAS 142
requires that goodwill and other intangible assets with indefinite useful
lives no longer be amortized, but instead tested for impairment at least
annually. The Company discontinued recording the amortization of its



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| |                                                                                                                                                                                                                             
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | goodwill included in net assets held for sale subsequent to filing the
Bankruptcy Cases. As of December 6, 2001, the Company wrote-down $13.0
million of its goodwill due to the sale of Fitzgeralds Black Hawk to
Majestic.

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Also in June 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 143, Accounting for Asset
Retirement Obligations,which is effective for financial statements issued
for fiscal years beginning after June 15, 2002. This statement establishes
accounting standards for recognition and measurement of a liability for an
asset retirement obligation and the associated asset retirement cost. The
Company is currently evaluating the impact that this standard will have on
the its financial condition and results of operations.

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In August 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 144 Accounting for the
Impairment or Disposal of Long-Lived Assets,which is effective for
financial statements issued for fiscal years beginning after December 15,
2001, and the interim periods within those fiscal years. This statement
addresses financial accounting and reporting for the impairment of
long-lived assets and for long-lived assets to be disposed of, and
supersedes Statement of Financial Accounting Standards No. 121, Accounting
for the Impairment of Long-Lived Assets and For Long-Lived Assets to be
Disposed of.The Company is currently evaluating the impact that this
standard will have on its financial condition and results of operation.

4.   NET ASSETS HELD FOR SALE

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In December 2000, the Company entered into the Restructuring Agreement with
the Consenting Noteholders. The Restructuring Agreement contemplates an
expeditious and orderly sale of all of the Companys operating assets and
properties. In accordance with the provisions of the Restructuring
Agreement, on December 6, 2001 substantially all the assets and liabilities
of the Fitzgeralds Las Vegas, Fitzgeralds Mississippi and Fitzgeralds Black
Hawk properties were sold to Majestic. The purchase price for the Assets
was $149.0 million, subject to certain adjustments and holdbacks specified
in the purchase agreement with Majestic, which resulted in net proceeds
prior to distributions of approximately $146.9 million. The Company is
actively seeking a buyer for the Fitzgeralds Reno property.

| |                                                                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | As of March 31, 2002 and December 31, 2001 assets included in net assets
held for sale of $12.2 million and $12.0 million, respectively consist
mainly of property and equipment transferable upon the sale of
Fitzgeralds
Reno.

5.   LONG TERM DEBT

| |                                                                                                                                                                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Notes bear interest at a fixed annual rate of 12.25% payable on June 15
and December 15 of each year, commencing June 15, 1998. The Notes stated
maturity date is on December 15, 2004. The Company has not paid the
regularly scheduled interest payments of $12.5 million



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| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | that were due and payable June 15, 1999. Under the Note Indenture, an Event
of Default occurred on July 15, 1999, and continued until the Company filed
the Bankruptcy Cases. Failure to make the scheduled interest payment on
June 15, 1999 resulted in a 1.0% increase in the interest rate to 13.25%,
effective June 16, 1999 until the Company filed the Bankruptcy Cases. Upon
execution of the Restructuring Agreement and before commencement of the
Bankruptcy Cases, the Company distributed $13.0 million in Excess Cash (as
that term is defined in the Restructuring Agreement) to the Indenture
Trustee to be applied to unpaid and accrued Indenture Trustees fees and
expenses incurred and as partial payment of accrued and unpaid interest as
provided in the Indenture. Pursuant to the Restructuring Agreement and an
order entered by the Bankruptcy Court, the Company was required to
distribute unrestricted cash (which includes cash in net assets held for
sale) in excess of $24.8 million to holders of its Notes within 45 days
after the end of each quarter. In May, August and November 2001, the
Company distributed $1.8 million, $7.7 million and $7.2 million,
respectively, in Excess Cash to the Indenture Trustee to be applied to
accrued and unpaid interest and principal as provided in the Indenture. The
Company and the Informal Committee are currently engaged in discussions to
establish a new threshold for cash reserves subsequent to the December 6,
2001 sale of Fitzgeralds Las Vegas, Fitzgeralds Tunica and Fitzgeralds Black
Hawk to Majestic. On December 6, 2001, approximately $133.3 million was
distributed to the Indenture Trustee from the proceeds of the December 6,
2001 sale to Majestic.

7.   SEGMENT INFORMATION

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Company is a gaming holding company that until December 6, 2001 owned
and operated four Fitzgeralds-brand casino-hotels, in downtown Las Vegas,
Nevada, Reno, Nevada, Tunica, Mississippi, and Black Hawk, Colorado. Until
the Company sold substantially all of the assets and related liabilities of
its Fitzgeralds Las Vegas, Fitzgeralds Mississippi and Fitzgeralds Black
Hawk properties to Majestic on December 6, 2001, the Company identified its
business in four segments based on geographic location. The Company
marketed, prior to December 6, 2001, in each of its segments, and currently
markets Fitzgeralds Reno primarily to middle-market customers, emphasizing
its Fitzgeralds brand and its Fitzgeralds Irish Luck theme. The major
products offered prior to December 6, 2001, in each segment were and
currently offered at Fitzgeralds Reno are: casino and hotel (except for
Fitzgeralds Black Hawk) and food and beverage.

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The accounting policies of each business segment were, and in the case of
Fitzgeralds Reno, are the same as those described in the summary of
significant accounting policies in the Companys Annual Report on Form 10-K
for the year ended December 31, 2001. There are minimal inter-segment
sales. The Company continues to evaluate its business segment performance
based on the Companys earnings before interest, income taxes, depreciation
and amortization (EBITDA). The Company has not changed its basis of
segmentation from the year ended December 31, 2001.



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|                               |                        |                  |        |                        |        |               |        |        |       | 
|------------------------------ | ---------------------- | ---------------- | ------ | ---------------------- | ------ | ------------- | ------ | ------ | ----- | 
|                               |                        |                  |        | For the Quarters Ended
|                               |                        |                  |        |                       
|                               |                        |                  |        | March 31, 2002         |        | April 1, 2001
|                               |                        |                  |        |                        |        |              
|                               |                        |                  |        | (in thousands)        
|Net operating revenues:        |                        |                  |        |                        |        |               |        |       
|                               | Fitzgeralds Las Vegas  |                  | $      |                       |        |               | $      | 14,309 |      
|                               | Fitzgeralds Tunica     |                  |        |                       |        |               |        | 21,236 |      
|                               | Fitzgeralds Reno       |                  |        | 8,265                  |        |               |        | 8,664  |      
|                               | Fitzgeralds Black Hawk |                  |        |                       |        |               |        | 7,874  |      
|                               | Other                  |                  |        | 9                      |        |               |        | 46     |      
|                               |                        |                  |        |                        |        |               |        |       
|Total                          |                        | $                | 8,274  |                        |        | $             | 52,129 |       
|                               |                        |                  |        |                        |        |               |        |       
|Income (loss) from operations: |                        |                  |        |                        |        |               |        |       
|                               | Fitzgeralds Las Vegas  |                  | $      | (209                   | )      |               | $      | 1,664  |      
|                               | Fitzgeralds Tunica     |                  |        | (17                    | )      |               |        | 5,442  |      
|                               | Fitzgeralds Reno       |                  |        | (223                   | )      |               |        | (71    | )    
|                               | Fitzgeralds Black Hawk |                  |        | (370                   | )      |               |        | 1,594  |      
|                               | Other                  |                  |        | (1,137                 | )      |               |        | (832   | )    
|                               |                        |                  |        |                        |        |               |        |       
|                               |                        | Total Properties |        |                        | (1,956 | )             |        |        | 7,797 | 
|                               | Nevada Club            |                  |        | (13                    | )      |               |        | (35    | )    
|                               |                        |                  |        |                        |        |               |        |       
|Total                          |                        | $                | (1,969 | )                      |        | $             | 7,762  |       
|                               |                        |                  |        |                        |        |               |        |       

| |                                                                                                               
| | --------------------------------------------------------------------------------------------------------------
| | Reconciliation of total business segment operating income to consolidated
net income (loss) before income tax:

|                                      |                                |   |                        |        |               |   |       |        |  
|------------------------------------- | ------------------------------ | - | ---------------------- | ------ | ------------- | - | ----- | ------ | -
|                                      |                                |   | For the Quarters Ended
|                                      |                                |   |                       
|                                      |                                |   | March 31, 2002         |        | April 1, 2001
|                                      |                                |   |                        |        |              
|                                      |                                |   | (in thousands)        
|Total segment operating income (loss) |                                | $ | (818                   | )      |               | $ | 8,629 |       
|                                      | Nevada Club                    |   |                        | (13    | )             |   |       | (35    | )
|                                      | Other                          |   |                        | (1,138 | )             |   |       | (1,828 | )
|                                      | Eliminations                   |   |                        | 926    |               |   |       | (8,697 | )
|                                      | Interest income                |   |                        | 19     |               |   |       | 46     |  
|                                      | Interest income  intercompany |   |                        |       |               |   |       | 18     |  
|                                      | Interest expense               |   |                        | (330   | )             |   |       | (508   | )
|                                      | Other income (expense)         |   |                        | (927   | )             |   |       | 9,680  |  
|                                      |                                |   |                        |        |               |   |       |       
|Net income (loss)                     |                                | $ | (2,281                 | )      |               | $ | 7,305 |       
|                                      |                                |   |                        |        |               |   |       |       



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

The Private Securities Litigation Reform Act of 1995 provides a safe harbor
for forward-looking statements. The following discussion should be read in
conjunction with, and is qualified in its entirety by, the Condensed
Consolidated Financial Statements and the Notes thereto included in this
report. The following discussion and other material in this Quarterly Report
on Form 10-Q contain certain forward-looking statements. The forward-looking
statements are necessarily based upon a number of estimates and assumptions
that, while considered reasonable, are inherently subject to significant
business, economic and competitive uncertainties and contingencies, many of
which are beyond the control of the Company, and upon assumptions with respect
to future business decisions which are subject to change. Risks to which the
Company is subject include, but are not necessarily limited to, its efforts to
restructure its indebtedness and capital structure, the ability to successfully
sell its assets and the successful conclusion of the Bankruptcy Cases, competition, high
level of indebtedness, the need for additional financing, development and
construction risks, market fluctuations, gaming, liquor and other regulatory
matters, taxation, the availability and retention of key management,
environmental matters and other factors discussed in the Companys other
filings with the Securities and Exchange Commission. Accordingly, actual
results could differ materially from those contemplated by such forward-looking
statements.

General

Fitzgeralds Gaming Corporation (the Company) is a gaming holding company that
until December 6, 2001 owned and operated four Fitzgeralds-brand casino-hotels,
in downtown Las Vegas, Nevada (Fitzgeralds Las Vegas), Reno, Nevada
(Fitzgeralds Reno), Tunica, Mississippi (Fitzgeralds Tunica), and Black
Hawk, Colorado (Fitzgeralds Black Hawk), collectively referred to as (the
Operating Properties). On December 6, 2001, the Company sold substantially
all of the assets and related liabilities of its Fitzgeralds Las Vegas,
Fitzgeralds Tunica and Fitzgeralds Black Hawk properties to Majestic and
currently has only one Operating Property  Fitzgeralds Reno.

The Company currently conducts substantially all of its business through wholly
owned subsidiaries: Fitzgeralds Reno, Inc. (FRI); Fitzgeralds South, Inc.
(FSI); and Fitzgeralds Incorporated (FI). FRI directly owns and operates
Fitzgeralds Reno; FSI owns the residual assets and liabilities of Fitzgeralds
Las Vegas (FLVI) and Fitzgeralds Tunica (FMI) through wholly owned
subsidiaries; and FI owns the residual assets and liabilities of Fitzgeralds
Black Hawk through wholly-owned subsidiaries, including 101 Main Street Limited
Liability Company.



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Unless the context otherwise requires, the Company refers to Fitzgeralds
Gaming Corporation and its subsidiaries. The Company was incorporated in
Nevada in 1994 to serve as a holding company. The executive office of the
Company is located at 3097 E. Warms Springs Rd. Suite 100, Las Vegas, Nevada
89120; telephone (702) 940-2000; facsimile (702) 940-2207.

In the narrative discussion below, the 2002 Period is defined as the quarter
ended March 31, 2002 and the 2001 Period is defined as the quarter ended
April 1, 2001. The comparison of the 2002 Period to the 2001 Period will not
be meaningful due to the December 6, 2001 sale of substantially all of the
assets of Fitzgeralds Las Vegas, Fitzgeralds Tunica and Fitzgeralds Black Hawk.
Operating results for the 2002 Period reflect the ongoing operating results
for Fitzgeralds Reno, corporate expenses and administrative expenses associated
with the residual assets and liabilities of the operations sold on December 6,
2001. Unless otherwise noted, the narrative discussion below is focused on the
results of the Companys Operating Properties which are collectively referred
to as (the Properties) and excludes Nevada Club, which was sold in June 1999,
and in managements opinion, is not material to the ongoing operations of the
Company. Corporate expense of $0.25 million was allocated to each of the four
Operating Properties for the 2001 Period. In the 2002 Period the Company did
not allocate any corporate expense to the Operating Properties, however
Fitzgeralds Reno incurred $0.09 million of net expense for services previously
provided by the Company. Such expenses are included in selling, general and
administrative expenses at the Operating Properties. The remainder of the
unallocated corporate expense is included in the selling, general and
administrative expenses of Other Operations of the Properties. See Note 1 of
Statement of Operations Data.

2002 Period Comparison to 2001 Period

The table below sets forth Net Operating Revenues, Income (Loss) from
Operations, EBITDA, Adjusted EBITDA and other financial data for the 2002
Period and the 2001 Period. EBITDA for the Properties was $(2.0) million and
$7.8 million for the 2002 and 2001 Periods, respectively. Adjusted EBITDA,
which the Company uses as a reasonable measure of its ability to generate cash
from operating activities and as a means to compare the Companys performance
with that of its competitors, decreased to $(1.3) million for the 2002 Period
from $8.5 million for the 2001 Period. For a definition of EBITDA and
Adjustments to EBITDA, see Notes 2 and 3, respectively, of Statement of
Operations Data.

|                             |                        |                |   |                        |       |  |   |        |        | 
|---------------------------- | ---------------------- | -------------- | - | ---------------------- | ----- |  | - | ------ | ------ | 
|                             |                        |                |   | For the Quarters Ended
|                             |                        |                |   |                       
|Statement of Operations Data |                        | March 31, 2002 |   | April 1, 2001         
|                             |                        |                |   |                       
|                             |                        |                |   | (in thousands)        
|Net Operating Revenues:      |                        |                |   |                        |       |  |   |       
|                             | Fitzgeralds Las Vegas  |                | $ |                       |       |  | $ | 14,309 |       
|                             | Fitzgeralds Tunica     |                |   |                       |       |  |   | 21,236 |       
|                             | Fitzgeralds Reno       |                |   | 8,265                  |       |  |   | 8,664  |       
|                             | Fitzgeralds Black Hawk |                |   |                       |       |  |   | 7,874  |       
|                             | Other                  |                |   | 9                      |       |  |   | 46     |       
|                             |                        |                |   |                        |       |  |   |       
|                             |                        | Total          |   | $                      | 8,274 |  |   | $      | 52,129 | 
|                             |                        |                |   |                        |       |  |   |       



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|                                    |                           |                  |      |                        |        |               |      |       |       | 
|----------------------------------- | ------------------------- | ---------------- | ---- | ---------------------- | ------ | ------------- | ---- | ----- | ----- | 
|                                    |                           |                  |      | For the Quarters Ended
|                                    |                           |                  |      |                       
|                                    |                           |                  |      | March 31, 2002         |        | April 1, 2001
|                                    |                           |                  |      |                        |        |              
|                                    |                           |                  |      | (in thousands)        
|Income (Loss) from Operations:      |                           |                  |      |                        |        |               |      |      
|                                    | Fitzgeralds Las Vegas     |                  | $    | (209                   | )      |               | $    | 1,664 |      
|                                    | Fitzgeralds Tunica        |                  |      | (17                    | )      |               |      | 5,442 |      
|                                    | Fitzgeralds Reno          |                  |      | (223                   | )      |               |      | (71   | )    
|                                    | Fitzgeralds Black Hawk    |                  |      | (370                   | )      |               |      | 1,594 |      
|                                    | Other (1)                 |                  |      | (1,137                 | )      |               |      | (832  | )    
|                                    |                           |                  |      |                        |        |               |      |      
|                                    |                           | Total Properties |      |                        | (1,956 | )             |      |       | 7,797 | 
|                                    | Nevada Club               |                  |      | (13                    | )      |               |      | (35   | )    
|                                    |                           |                  |      |                        |        |               |      |      
|                                    |                           | Total            |      | $                      | (1,969 | )             |      | $     | 7,762 | 
|                                    |                           |                  |      |                        |        |               |      |      
|Other Data                          |                           |                  |      |                        |        |               |      |      
|EBITDA (2):                         |                           |                  |      |                        |        |               |      |      
|                                    | Fitzgeralds Las Vegas     |                  | $    | (209                   | )      |               | $    | 1,664 |      
|                                    | Fitzgeralds Tunica        |                  |      | (10                    | )      |               |      | 5,442 |      
|                                    | Fitzgeralds Reno          |                  |      | (213                   | )      |               |      | (71   | )    
|                                    | Fitzgeralds Black Hawk    |                  |      | (70                    | )      |               |      | 1,593 |      
|                                    | Other (1)                 |                  |      | (1,510                 | )      |               |      | (819  | )    
|                                    |                           |                  |      |                        |        |               |      |      
|                                    |                           | Total Properties |      |                        | (2,012 | )             |      |       | 7,809 | 
|                                    | Nevada Club               |                  |      | (13                    | )      |               |      | (35   | )    
|                                    |                           |                  |      |                        |        |               |      |      
|                                    |                           | Total EBITDA     |      |                        | (2,025 | )             |      |       | 7,774 | 
|                                    | Adjustments to EBITDA (3) |                  |      | 708                    |        |               |      | 717   |      
|                                    |                           |                  |      |                        |        |               |      |      
|                                    |                           | Adjusted EBITDA  |      | $                      | (1,317 | )             |      | $     | 8,491 | 
|                                    |                           |                  |      |                        |        |               |      |      
|Net Cash Provided by (Used in) (4): |                           |                  |      |                        |        |               |      |      
|                                    | Operating Activities      |                  | $    | (1,246                 | )      |               | $    | 9,265 |      
|                                    | Investing Activities      |                  |      | (48                    | )      |               |      | (802  | )    
|                                    | Financing Activities      |                  |      | (41                    | )      |               |      | (113  | )    
|Depreciation and Amortization       |                           |                  | 8    |                        |        |               | 12   |      
|Capital Expenditures                |                           |                  | (195 | )                      |        |               | (455 | )    
|Earnings to Fixed Charges (5):      |                           |                  |     |                        |        |               | 9.4  |      



---

|(1) |  | Other includes corporate expenses not allocated to the Operating
Properties of $0.7 million for the 2001 Period. In 2002 Period other
includes corporate expenses of $1.1 million. Both the 2001 and 2002
Periods include post-petition professional fees and expenses, net of
interest income included in reorganization items.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | EBITDA is a supplemental financial measurement used by the Company in the
evaluation of its gaming business and by many gaming industry analysts.
EBITDA is calculated by adding depreciation and amortization expense to
income from operations. At any property, EBITDA is calculated after the
allocation of corporate costs. However, EBITDA should only be read in
conjunction with all of the Companys financial data summarized above and
its financial statements prepared in accordance with GAAP appearing
elsewhere herein, and should not be construed as an alternative either to
income from operations (as determined in accordance with GAAP) as an
indication of the Companys operating performance or to cash flows from
operating activities (as determined in accordance with GAAP) as a measure
of liquidity. This presentation of EBITDA may not be comparable to
similarly titled measures reported by other companies.
|   
|   
|   
|   
|(3) |  | Adjustments to EBITDA include (i) exclusion of EBITDA for Nevada Club for
both periods presented; (ii) exclusion of $0.7 million of post-petition
professional fees and expenses, net of interest income included as
reorganization items in both the 2001 and 2002 Periods.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   
|   
|   
|   
|(4) |  | Includes financial results of (i) Nevada Club for both periods presented.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       



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|(5) |  | For the Ratio of Earnings to Fixed Charges, earnings are defined as
earnings before income taxes, interest on indebtedness, imputed interest
on capital lease obligations and the portion of rent expense deemed to
represent interest. Fixed charges consist of interest on indebtedness,
imputed interest on capital lease obligations and the portion of rent
expense deemed to represent interest. The Fixed Charged Coverage Ratio
was 9.4x for the 2001 Period; however, earnings were insufficient to cover
fixed charges by $2.3 million for the 2002 Period.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Operating Revenues

Total revenues for the Operating Properties were $9.5 million and net operating
revenues were $8.3 million for the 2002 Period, representing 84.5% and 84.1%
decreases, respectively, over total revenues of $61.1 million and net operating
revenues of $52.1 million for the 2001 Period. The decrease is due to the sale
of the Fitzgeralds Las Vegas, Fitzgeralds Tunica and Fitzgeralds Black Hawk
properties to Majestic on December 6, 2001. Total net revenues for Fitzgeralds
Reno decreased 4.6% to $8.3 million for the 2002 Period from $8.7 million for
the 2001 Period.

The Companys business can be separated into four operating departments:
casino, food and beverage, rooms and other. Casino revenues for the Operating
Properties represented 73.0% and 78.6% of total revenues for the Operating
Properties for the 2002 and 2001 Periods, respectively. Casino revenues for
the Operating Properties (of which approximately 73.4% and 80.8% were derived
from slot machine revenues for the 2002 and 2001 Periods, respectively)
decreased 85.6% to $6.9 million for the 2002 Period from $48.0 million for the
2001 Period. Casino revenue for Fitzgeralds Reno decreased 1.4% to $6.9
million for the 2002 Period from $7.0 million for the 2001 Period.

Room revenues for the Operating Properties (at 10.7% and 8.7% of total revenues
for the Operating Properties for the 2002 and 2001 Periods, respectively)
decreased 81.0% from the 2001 Period. Fitzgeralds Reno room revenues decreased
8.2% due to a decrease in the average daily rate of 6.5% and a decrease in the
average occupancy rate to 80.7% for the 2002 Period from 81.6% for 2001 Period.

Food and beverage revenues for the Operating Properties (at 14.0% and 10.6% of
total revenues for the Operating Properties for the 2002 and 2001 Periods,
respectively) decreased approximately 79.5% to $1.3 million for the 2002
Period. Food and beverage revenues for Fitzgeralds Reno decreased 1.8% to $1.3
million for the 2002 Period from $1.4 million for the 2001 Period.

Other revenues for the Operating Properties decreased 83.7% or $1.1 million for
the 2002 Period.

Promotional allowances for the Operating Properties decreased $7.8 million or
86.7% for the 2002 Period primarily as a result of the sale to Majestic.
Promotional allowances for Fitzgeralds Reno increased 19.8% to $1.2 million for
the 2002 Period from $1.0 million for the 2001 Period.

Operating Costs and Expenses

Total operating costs and expenses for the Operating Properties decreased 76.9%
to $10.2 million for the 2002 Period from $44.4 million for the 2001 Period due
primarily to the sale of the Fitzgeralds Las Vegas, Fitzgeralds Tunica and
Fitzgeralds Black Hawk properties to Majestic



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on December 6, 2001. Total operating expenses for Fitzgeralds Reno decreased
2.8% to $8.5 million for the 2002 Period from $8.7 million for the 2001 Period.

Casino expenses for the Operating Properties were $3.8 million for the 2002
Period, a 82.8% decrease from $22.1 million for the 2001 Period. Food and
beverage expenses for the Operating Properties decreased 76.3% to $0.9 million
for the 2002 Period from $3.8 million for the 2001 Period. Room expenses for
the Operating Properties decreased 86.8% to $0.4 million for the 2002 Period
from $3.2 million for the 2001 Period. Selling, general and administrative
expenses for the Operating Properties decreased 69.2% to $4.3 million for the
2002 Period from $14.0 million for the 2001 Period. Professional fees and
expenses incurred in conjunction with the ongoing development, negotiation and
implementation of the Companys restructuring were $0.7 million for both the
2002 and 2001 Periods. Such expenses also include professional fees and
expenses paid by the Company for the financial and legal advisors to the
informal committee (the Committee) representing holders of a majority in
interest of the Notes, the Indenture Trustee, and the U.S. Trustee in
connection with the Bankruptcy Cases.

Personnel expenses for the Operating Properties decreased 80.2% to
approximately $4.1 million for the 2002 Period from approximately $20.9 million
for the 2001 Period. Such expenses are included in the operating departmental
expense to which they relate on the consolidated statements of operations.

Marketing expenses for the Operating Properties, which include advertising,
promotional material, special events and the operations of the Fitzgeralds
player-tracking card, decreased $4.8 million or 81.6% for the 2002 Period.
Such expenses are included in selling, general and administrative expenses on
the consolidated statements of operations.

Depreciation and amortization expenses of the Operating Properties decreased
26.7% to approximately $0.008 million for the 2002 Period from $0.01 million
for the 2001 Period.

Income from Operations

Income from operations for the Company decreased 125.1% to a net loss from
operations of $2.0 million for the 2002 Period from a net income from
operations of $7.8 million for the 2001 Period. Net loss from operations for
Fitzgeralds Reno increased to $0.2 million for the 2002 Period from $0.1
million for the 2001 Period.

Net Interest Expense

Interest expense for the Company (net of interest income) decreased 32.7% to
$0.3 million for the 2002 Period from $0.5 million for the 2001 Period. Section
506(b) of the Bankruptcy Code permits the allowance of interest on an allowed
secured claim secured by property the value of which is greater than the amount
of the claim. Inasmuch as the parties to the Restructuring Agreement have
concluded that the fair market value of the collateral securing the Notes is
less than the outstanding principal of the Notes, concurrently with the filing
of the Bankruptcy Cases on December 5, 2000 the Company ceased accruing
interest on the Notes.



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Net Income

Net Income for the Company decreased $9.6 million to a net loss of $2.3 million
in the 2002 Period from net income of $7.3 million in the 2001 Period. The
decrease was primarily due to the sale of the Fitzgeralds Las Vegas,
Fitzgeralds Tunica and Fitzgeralds Black Hawk properties to Majestic on
December 6, 2001.

Liquidity and Capital Resources

At March 31, 2002, the Company had unrestricted cash of $24.3 million, compared
to $25.6 million at December 31, 2001. The Companys net cash used in
operating activities was $1.2 million during the 2002 Period. Net cash used in
investing activities was $0.05 million and $0.8 million for the 2002 and 2001
Periods, respectively. Net cash used in financing activities was $0.04 million
and $0.1 million for the 2002 and 2001 Periods, respectively.

The Companys principal sources of capital have historically consisted of cash
from operations and vendor or third party financing of gaming and other
equipment. However, its relatively high degree of leverage has prevented it
from making the level of capital expenditures required to maintain and enhance
the competitive position of its properties. Management and the Board of
Directors did not see any way to resolve this problem without restructuring the
Companys indebtedness. An Event of Default under the Indenture pursuant to
which the Notes were issued occurred on July 15, 1999. The Company believes
that it has adequate sources of liquidity to meet the normal operating
requirements of its reduced activities following the sale of Fitzgeralds Las
Vegas, Fitzgeralds Tunica and Fitzgeralds Black Hawk

The Restructuring Agreement provides a vehicle for liquidating the assets of
the Company in the Bankruptcy Court through Chapter 11 of the Bankruptcy Code.
Upon execution of the Restructuring Agreement and before commencement of the
Bankruptcy Cases, the Company distributed $13.0 million in Excess Cash (as that
term is defined in the Restructuring Agreement) to the trustee under the
Indenture (the Indenture Trustee) to be applied to unpaid and accrued
Indenture Trustees fees and expenses incurred and as partial payment of
accrued and unpaid interest and principal as provided in the Indenture.

Pursuant to the Restructuring Agreement and an order entered by the Bankruptcy
Court, the Company was required to distribute unrestricted cash (which includes
cash in net assets held for sale) in excess of $24.8 million to holders of its
Notes within 45 days after the end of each quarter until the closure of its
sale to Majestic. In May, August and November 2001, the Company distributed
$1.8 million, $7.7 million and $7.2 million, respectively, in Excess Cash to
the Indenture Trustee to be applied to accrued and unpaid interest and
principal as provided in the Indenture. The Company and the Informal Committee
are currently engaged in discussions to establish a new threshold for cash
reserves subsequent to the December 6, 2001 sale to Majestic. As part of the
Restructuring Agreement, the Consenting Noteholders and Indenture Trustee
agreed to forbear from exercising certain of their rights otherwise allowable
under the Notes and the Indenture.



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On December 5, 2000, the Company commenced the Bankruptcy Cases in the
Bankruptcy Court. For further information concerning the Bankruptcy Cases and
related matters, see Note 2 to the Unaudited Notes to Condensed
Consolidated Financial Statements.

By suspending the interest payments on the Notes other than the Post-petition
Distributions and sales proceeds of collateral for the Notes until such time as
the liquidation of the remainder of the Companys assets contemplated by the
Restructuring Agreement has been completed, the Company believes that its
liquidity and capital resources will be sufficient to maintain normal
operations at Fitzgeralds Reno at current levels during the pendency of the
Bankruptcy Cases and does not anticipate any adverse impact on operations,
customers or employees at Fitzgeralds Reno. However, costs incurred and to be
incurred in connection with the Bankruptcy Cases have been and will continue to
be substantial and, in any event, there can be no assurance that the Company
will be able to successfully consummate the Restructuring Agreement or that its
liquidity and capital resources will be sufficient to maintain normal
operations at Fitzgeralds Reno during the pendency of the Bankruptcy Cases.

EBITDA and Adjusted EBITDA

The Companys EBITDA was $(2.0) million for the 2002 Period and $7.8 million
for the 2001 Period. EBITDA is calculated by adding depreciation and
amortization expenses to income from operations. The Companys Adjusted EBITDA
was $(1.3) million for the 2002 Period and $8.5 million for the 2001 Period.
Adjusted EBITDA is determined based on the adjustments described in Note 3 to
Statement of Operations Data. However, EBITDA should only be read in
conjunction with all of the Companys financial data summarized above and its
financial statements prepared in accordance with GAAP appearing elsewhere
herein, and should not be construed as an alternative either to income from
operations (as determined in accordance with GAAP) as an indication of the
Companys operating performance or to cash flows from operating activities (as
determined in accordance with GAAP) as a measure of liquidity. This
presentation of EBITDA may not be comparable to similarly titled measures
reported by other companies.

Ratio of Earnings to Fixed Charges

The ratio of earnings to fixed charges measures the extent by which earnings,
as defined, exceed certain fixed charges. Earnings are defined as earnings
before income taxes, interest on indebtedness, imputed interest on capital
lease obligations and the portion of rent expense deemed to represent interest.
Fixed charges consist of interest on indebtedness, imputed interest on capital
lease obligations and the portion of rent expense deemed to represent interest.
The Fixed Charge Coverage Ratio was 9.4x for the 2001 Period, however earnings
were insufficient to cover fixed charges by $2.3 million for the 2002 Period.

Business Seasonality and Severe Weather

The gaming operations of the Company in certain locations may be seasonal and,
depending on the location and other circumstances, the effects of such
seasonality could be significant. At



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Fitzgeralds Las Vegas, business levels were generally weaker from Thanksgiving
through the middle of January (except during the week between Christmas and New
Years) and throughout the summer, and generally stronger from mid-January
through Easter and from mid-September through Thanksgiving. At each of the
three other Operating Properties, business levels are typically weaker from
Thanksgiving through the end of the winter and typically stronger from mid-June
to mid-November.

Recently Issued Accounting Standards

In June 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 141 (SFAS 141), Business
Combinations, which requires the purchase method of accounting for business
combinations initiated after June 30, 2001 and prohibits the use of the
pooling-of-interest method. Adoption of this statement did not have a
material impact on its financial condition or results of operation.

In June 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 142 (SFAS 142) Goodwill and
Other Intangible Assets, which is effective January 1, 2002. SFAS 142 requires
that goodwill and other intangible assets with indefinite useful lives no
longer be amortized, but instead tested for impairment at least annually. The
Company discontinued recording the amortization of its goodwill included in net
assets held for sale subsequent to filing the Bankruptcy Cases. As of December
6, 2001, the Company wrote-down $13.0 million of its goodwill due to the sale
of Fitzgeralds Black Hawk to Majestic.

Also in June 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 143, Accounting for Asset
Retirement Obligations, which is effective for financial statements issued for
fiscal years beginning after June 15, 2002. This statement establishes
accounting standards for recognition and measurement of a liability for an
asset retirement obligation and the associated asset retirement cost. The
Company is currently



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evaluating the impact that this standard will have on the its financial
condition and results of operations.

In August 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 144 Accounting for the
Impairment or Disposal of Long-Lived Assets, which is effective for financial
statements issued for fiscal years beginning after December 15, 2001, and the
interim periods within those fiscal years. This statement addresses financial
accounting and reporting for the impairment of long-lived assets and for
long-lived assets to be disposed of, and supersedes Statement of Financial
Accounting Standards No. 121, Accounting for the Impairment of Long-Lived
Assets and For Long-Lived Assets to be Disposed of. The Company is currently
evaluating the impact that this standard will have on its financial condition
and results of operation.



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Item 3
 Quantitative and Qualitative Disclosures About Market Risk

The fair market value of the Companys fixed debt obligations have increased to
approximately $52.0 million at March 31, 2002 compared to $51.9 million at
December 31, 2001. See Item 2. Managements Discussion and Analysis of
Financial Condition and Results of Operations -Liquidity and Capital Resources.



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PART II
OTHER INFORMATION

Item 1. Legal Proceedings.

Reno Transportation Rail Access Corridor (ReTRAC) Project

In October 1998, the Reno City Council approved a special assessment district
to finance a portion of the costs to lower the railroad tracks that run through
downtown Reno, Nevada (the ReTRAC Project). Preliminary plans for the ReTRAC
Project provide for the construction of a temporary rail bypass that will be
used to divert rail traffic around the main railroad during construction. The
City of Reno (the City) estimates that a period of approximately two and one
half years will be required to complete the ReTRAC Project. The southern
boundary of the bypass will extend out into the middle of Commercial Row, the
street where Fitzgeralds Reno hotel entrance, valet parking area and hotel
loading zone are situated.

On November 30, 1998, the Company filed a lawsuit against the City to challenge
the method by which the special assessment to be levied against the Company was
determined. Based on preliminary plans prepared by the City, Fitzgeralds Reno
would expect to lose several parking spaces, the current valet parking area, an
outdoor billboard structure advertising available rooms and a building used to
house administrative offices, and be required to relocate the hotel entrance
currently on Commercial Row. The City has also subsequently indicated that the
ReTRAC Project might require the demolition of the Fitzgeralds Reno Rainbow
Skyway. Implementation of the ReTRAC Project under these circumstances would
cause the Company to suffer significant and permanent loss in business revenue
and income; certain operating efficiencies from demolished or impaired physical
structures; and a portion of its existing customer base as a result of the
construction and operation of the proposed rail bypass.

The City of Reno filed an answer to the Companys lawsuit on January 19, 1999.
Subsequent thereto, George Karadanis and Robert Maloff d/b/a Sundowner Hotel
and Casino (the Sundowner) were permitted by court order to file a Complaint
in Intervention. Notwithstanding that intervention, on December 22, 1999, the
court granted the City of Renos Motion for Summary Judgment against the
Sundowner which motion was joined in by the Company.

After hearing oral arguments and considering the parties briefs, the Court
concluded that there was insufficient evidence before the Reno City Council to
support a finding that the ReTRAC Project confers a special benefit on
Fitzgeralds Reno as is required by statute before a special assessment may be
imposed. The Court remanded the matter to the Reno City Council and directed
the council to conduct a new hearing to consider evidence as to whether
Fitzgeralds Reno would receive a special benefit from the proposed project. On
June 20, 2001, the Reno City Council commenced a public hearing in compliance
with the remand order of the Court. That public hearing was recessed and
continued to November 29, 2001. After resuming the hearing on November 29,
2001, the Reno City Council again recessed and continued the proceedings to
January 4, 2002, at which time the hearing was completed and the matter was
submitted for decision of the Reno City Council. On February 19, 2002, the
Reno City Council



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voted on the matter. By a 4-3 decision, the Reno City Council concluded that
the ReTRAC Project would confer a special benefit on Fitzgeralds Reno. On a
5-2 decision, however, the Reno City Council determined that the value of the
special benefit in light of the evidence presented was $1.00. The decisions of
the Reno City Council are subject to judicial review, a petition for which must
be filed within thirty days of the decisions. No judicial review petition was
filed within the required period.

On February 27, 2001, the Reno City Council voted to continue the process of
determining the actual cost of construction of the ReTRAC Project, which has
previously been estimated to be $218 million. It is anticipated that the
construction cost analysis will be completed in July 2002. On May 24, 2001,
Fitzgeralds Reno commenced an action, CV-N-01-0329-PMP-RAM, in the United
States District Court for the District of Nevada, against the Federal Highway
Administration (FHWA), the Nevada Department of Transportation (NDOT), and
the City (collectively, the Defendants) for violations of the National
Environmental Policy Act (NEPA), codified at 42 U.S.C. §§ 4321-4327. The
claims against all Defendants allege a violation of 42 U.S.C. § 4332 (Violation
of NEPA: Failure to Consider Reasonable Alternatives & Failure to Consider and
Provide Adequate Mitigation Measures). Specifically, Fitzgeralds Reno asserts
the Defendants failed to consider the Partial Cover and Cut Tunnel Alternative
and the use of the Feather River Route on a temporary basis, and failed to
include a plan for mitigating the adverse environmental impacts, including
construction disruption, loss of operating facilities, noise and vibration
impacts, that will be caused by the ReTRAC Project and incurred by Fitzgeralds
Reno and others.

On or about June 12, 2001, NDOT filed a motion to dismiss the Companys NEPA
complaint based on a claim of sovereign immunity and the Company moved to amend
its complaint to substitute as a defendant the Director of NDOT, Thomas E.
Stephens, for the Defendant NDOT, in lieu of considering NDOTs Eleventh
Amendment immunity claim. This unopposed motion was granted by the Court on
August 17, 2001, and the Company filed its amended complaint on August 23,
2001. Defendant FHWA filed its answer to the Complaint on September 6, 2001
and Defendant Stephens filed his answer on October 3, 2001. The City filed a
motion to dismiss the amended complaint so far as it named the City as
defendant on September 6, 2001. The Company filed an opposition to that motion
on October 24, 2001, and the City filed a reply in support of its motion to
dismiss on or about November 12, 2001. On February 15, 2002, the United States
District Court held a hearing to consider the Citys motion to dismiss. At the
hearing, the Defendant FHWA and the Defendant NDOT joined the Citys motion to
dismiss. The Citys motion to dismiss was fully argued and submitted to the
Court for a ruling. On March 11, 2002, the Court issued an order dismissing
all of the Companys claims against the City. The Court ruled the ReTRAC
Project must comply with NEPA but the specific federal aid statute under which
the City is receiving funding for the ReTRAC Project does not explicitly
require the local government body to consent to suit under NEPA. Accordingly,
the Court found the City is not a proper party in the case. The Court,
however, denied the motions to dismiss by FHWA and NDOT stating the Company is
entitled to proceed on the claims against those agencies for a violation of
NEPA.

Other Litigation- The Company is a party to various lawsuits relating to
routine matters incidental to its business. Except as noted below, the Company
does not believe that the outcome



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of such litigation, individually or in the aggregate, will have any material
adverse effect on its financial condition.

Reliance- From April 1, 1998 through September 30, 1999, the Companys general
liability insurance and workers compensation insurance carrier was Reliance
Insurance Company (Reliance). On May 29, 2001, a Pennsylvania court placed
Reliance under the control of the Pennsylvania Insurance Department for
rehabilitation. Thereafter, on October 3, 2001, the Reliance Insurance Company
was declared insolvent and placed under an order of liquidation by the
Pennsylvania Commonwealth Court at the request of the Pennsylvania Insurance
Department. The Pennsylvania Insurance Department is now referring claims
incurred in Mississippi, Nevada and Colorado from April 1, 1998 through
September 30, 1999 to the Mississippi Insurance Guaranty Association, the
Nevada Insurance Guaranty Association and the Colorado Insurance Guaranty
Association, respectively. Each states Guaranty Insurance Association will
investigate the claims incurred in their jurisdictions to determine if any of
these claims are eligible for any insurance coverage under the respective
Insurance Guaranty Association. The Company has not incurred any material
amounts for liability claims or workers compensation claims that would be
subject to reimbursement by Reliance. However, the statute of limitation has
not expired for filing claims and it is unclear at this time what the insurance
coverage would be from Reliance, if any, in the event that a future claim is
filed that would be large enough to result in an insurance reimbursement from
Reliance or any state Insurance Guaranty Association, or if there is insurance
coverage for an existing claim that is currently under the threshold level for
reimbursement, but increases in the future to an amount eligible for
reimbursement. The reimbursement threshold per claim is $25,000 and $100,000
for liability claims and worker compensation claims, respectively. At the
present time, the Company is unable to determine what effect this action may
have on liability and workers compensation claims which arose during the
coverage period for which Reliance was the Companys insurance carrier or
whether any limitations on coverage would have a material adverse effect on the
Companys financial condition.

Holiday Inn- Upon notification by Majestic of its intent to not enter into a
new franchise agreement with Holiday Inn Franchising, Inc. (Inns), the
Company filed a motion with the Bankruptcy Court on October 26, 2001 to remove
its pre-petition franchise and other agreements with Inns from the list of
agreements to be assumed and assigned to Majestic. On October 26, 2001, the
Bankruptcy Court granted the motion. Since the transactions contemplated by
the Purchase Agreement were consummated on December 6, 2001, the Company
believes Inns will assert an unsecured claim in the Bankruptcy Cases based upon
the liquidated damages provision of the franchise agreement, (approximately
$1.6 million). While the Company would contest the allowance of such a claim
by the Bankruptcy Court, the Company cannot predict the Bankruptcy Courts
ultimate resolution of such a claim.

Item 2. Changes in Securities and Use of Proceeds.

Not Applicable



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Item 3. Defaults Upon Senior Securities.



|(a) |  | As previously reported in its Report on Form 8-K filed July 22, 1999 and
elsewhere in this form 10-Q, the Company is in default on its $205.0
million Senior Secured Notes.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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

Not Applicable

Item 5. Other Information.

The Company files monthly operating statements with the Bankruptcy Court.
These filings are available for public inspection at the office of the clerk of
the Bankruptcy Court at 300 Booth Street, Reno, Nevada 89509 or on the internet
at www.nvb.uscourts.gov.

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

(a)  Exhibits

None

(b)  Reports on Form 8-K

Report on Form 8-K, Item 2, 5 and 7 filed on February 20, 2002



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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.

Dated: May 13, 2002



| | FITZGERALDS GAMING CORPORATION
(DEBTOR-IN-POSSESSION)
 
 
 /s/ Michael E. McPherson
Michael E. McPherson
Executive Vice President and
Chief Financial Officer
(Duly Authorized Officer, Principal
Financial Officer and Principal
Accounting Officer)
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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