SECURITIES AND EXCHANGE COMMISSION
                      Washington, D.C. 20549
                            -----------

                             FORM 10-K

(Mark One)

[x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended    January 1, 1998      
                          ----------------------------------------
                                 OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934
For the transition period from                 to                 
                               ---------------    ----------------
              Commission file number   1-5440        
                                     ----------------
                         AZTAR CORPORATION
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      (Exact name of registrant as specified in its charter)

            Delaware                           86-0636534         
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    (State or other jurisdiction of           (I.R.S. Employer
     incorporation or organization)            Identification No.)

2390 East Camelback Road, Suite 400, Phoenix, Arizona      85016  
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    (Address of principal executive offices)        (Zip Code)

Registrant's telephone number, including area code (602) 381-4100 
                                                   ---------------

Securities registered pursuant to Section 12(b) of the Act:

                                      Name of each exchange
    Title of each class                on which registered 
    -------------------               ---------------------
    Common stock, $.01 par value          New York
    Preferred share purchase rights       New York

Securities registered pursuant to Section 12(g) of the Act:

                               None

    Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing
requirements for the past 90 days.  Yes  x    No    
                                        ---      ---
<PAGE>
                      Facing Page (Continued)

    Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-K or any amendment to this Form 10-K. [X]

    The aggregate market value of the voting stock held by non-affiliates
of the registrant was $395,811,649 at March 2, 1998 and is based on a
closing price of $8.8125 and 44,914,797 common shares outstanding.

    At March 2, 1998, the registrant had outstanding 45,203,446 shares of
its common stock, $.01 par value.

                DOCUMENTS INCORPORATED BY REFERENCE

    Certain information contained in the registrant's 1998 definitive Proxy
Statement, to be filed with the Commission, is incorporated by reference
into this Form 10-K.  The following cross-referenced index details the
location of such information.  All other sections of the 1998 Proxy
Statement are not required in Form 10-K and should not be considered a part
thereof.

Part and Item of the Form 10-K                   1998 Proxy Statement
------------------------------                   --------------------

            PART III
            --------

ITEM 10. Directors and Executive 
-------    Officers of the Registrant            Under the caption
                                                 "ELECTION OF DIRECTORS OF
                                                 THE COMPANY" 

ITEM 11. Executive Compensation                  Under the caption
-------                                          "EXECUTIVE COMPENSATION"
                                                 except under the sub-
                                                 caption "Board
                                                 Compensation Committee
                                                 Report"

ITEM 12. Security Ownership of 
-------  Certain Beneficial Owners
         and Management                          Under the caption
                                                 "SECURITY OWNERSHIP OF
                                                 CERTAIN BENEFICIAL HOLDERS
                                                 AND DIRECTORS AND
                                                 OFFICERS"









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                                   PART I
                                   ------
ITEM 1.  BUSINESS
-----------------
Aztar Corporation ("Aztar" or the "Company") was incorporated in Delaware
in June 1989 to operate the gaming business of Ramada Inc. ("Ramada") after
the restructuring of Ramada (the "Restructuring").  The Restructuring
involved the disposition of Ramada's hotel and restaurant businesses with
Ramada's shareholders retaining their interest in the gaming business.  As
part of the Restructuring, the gaming business and certain other assets and
liabilities of Ramada were transferred to Aztar, and a wholly-owned
subsidiary of New World Hotels (U.S.A.), Inc. was merged with Ramada (the
"Merger").  In the Merger, each share of Ramada common stock was converted
into the right to receive $1.00 and one share of Aztar common stock.

The Company operates in major domestic gaming markets with casino hotel
facilities in Atlantic City, New Jersey, and Las Vegas and Laughlin,
Nevada.  The Company operates riverboat casinos in Caruthersville,
Missouri, and Evansville, Indiana.  The strategy at the Company's land-
based facilities has been to develop facilities with distinctive themes for
the demographics of each particular market and provide a full entertainment
experience to attract gaming patrons.  The Company's riverboat casinos
share a common theme and brand.  The Company's product concept is "the
creation of fun, fantasy, excitement and entertainment" in a casino gaming
environment.  While the Company markets to the full spectrum of casino
players, its focus is on the middle and high end of the market.

TROPICANA ATLANTIC CITY

Tropicana Casino and Resort encompasses approximately 10 acres and has
ocean beach frontage of 220 yards along the Boardwalk in Atlantic City. 
Tropicana Atlantic City's approximate 124,000-square-foot casino contains
3,719 slot machines and 174 table games, a baccarat lounge, a poker room
and keno.  The Tropicana Atlantic City complex contains 1,624 hotel rooms
and approximately 47,000 square feet of meeting, convention and banquet
space.  The facility also includes parking for 3,000 vehicles and a 1,700-
seat theatrical showroom which regularly presents headliner entertainment. 
Other amenities include four gourmet restaurants, several medium-priced
restaurants, indoor and outdoor swimming pools, tennis courts, a health and
fitness club and a jogging track.

During 1996, Tropicana Atlantic City completed an expansion and renovation
designed to attract more high-end players as well as to capitalize on
recent and anticipated growth of Atlantic City resulting from the new
Atlantic City Convention Center, airport expansion and other market
enhancements.  The new 604-room hotel tower, which opened in late April
1996, includes a concierge floor of six large penthouse suites completed in
July 1996.  Concurrent modifications made to the existing facilities
included the construction of a new hotel lobby, refurbishment of all
existing hotel rooms and extensive improvements to the casino.  Renovations
to the casino included the development of a new entrance designed to
improve traffic circulation throughout the casino and the introduction of a
new baccarat room and a new Asian games room.  To cater to  high-end
players, the new baccarat room has private dining areas as well as private
access from a new table player lounge and VIP entry.  The new games room 




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caters to the domestic Asian gaming community by offering pai gow, tile
games and mini-baccarat.  During 1997, Tropicana Atlantic City added new
casino facilities for middle- and upper- market slot players.  The Change
Your Life Casino offers a variety of the most popular reel and video game
machines with denominations and payouts geared to provide high jackpots to
attract the retail customer.  The Crystal Room, with elegant decor and
furnishings and service, is designed to appeal to the premium slot player.

The Atlantic City gaming market has demonstrated continued growth despite
the proliferation of new gaming venues across the country.  The 12 hotel
casinos in Atlantic City generated approximately $3.9 billion in gaming
revenues in 1997, a 2% increase over 1996.  Major infrastructure
improvements either recently completed or underway in Atlantic City
include, among other projects, new housing and retail development, an
upgrade and expansion of the Atlantic City International Airport and a
convention center having the largest exhibition space between New York and
Washington, D.C.  There are also plans for the expansion of existing gaming
capacity in Atlantic City, as well as the development of new gaming
projects.  Several major casino operators have announced plans to develop
projects in the Marina and Boardwalk areas, in addition to casino operators
having already expanded or planning to expand their existing facilities.

TROPICANA LAS VEGAS

Tropicana Resort and Casino is located on a 34-acre site at the
intersection of Las Vegas Boulevard (the famed Strip) and Tropicana Avenue
(known as the "New Four Corners") in Las Vegas, Nevada.  Tropicana Las
Vegas, which has a tropical theme, boasts one of the world's largest
indoor/outdoor swimming pools, as well as a five-acre water park and
tropical garden.  Both interior and exterior areas feature exhibits of live
tropical birds, animals and fish.  The casino occupies approximately 63,000
square feet and contains 1,782 slot machines and 66 table games.  The hotel
has 1,875 rooms and suites as well as approximately 100,000 square feet of
convention and exhibit space, plus an array of fine restaurants and
extensive parking.  Tropicana Las Vegas is home for the Folies Bergere, the
longest-running production show in Las Vegas.

The New Four Corners area of Las Vegas contains the MGM Grand, Excalibur,
Luxor, Monte Carlo and New York-New York mega-resorts.  The surge in
visitation to the New Four Corners as a result of these mega-resorts has
presented Tropicana Las Vegas with the opportunity to expand its customer
base.  During 1996 and 1997, modifications were made to the facility to
enhance its ability to attract new visitors.  More direct access to the Las
Vegas Tropicana from surrounding casinos was opened up.  The appearance of
the front of the property tying in to the pedestrian bridges that connect
the four corners of the intersection was made more inviting.  The look and
feel of the casino was enhanced.  In 1996, a new and elegant baccarat room
and a new premium slot area were created. In 1997, a new games room was
created to cater to the domestic Asian gaming community. In late 1996, the
casino was expanded and in 1997, a large number of slot machines were
replaced with models having the latest technology.

The improvements in 1996 and 1997 constitute an interim strategy. 
Ultimately, the Company's goal is to take advantage of the Las Vegas
Tropicana's premier location with its proximity to McCarran International
Airport and transform the property into a completely modern, must-see
casino resort.  

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The Tropicana Las Vegas site and facility are leased by the Company from an
unconsolidated partnership in which the Company has a 50% interest.  On
February 2, 1998, the Company acquired an option to purchase the 50%
partnership interest that it does not own.  The option agreement extends
for a period of up to 18 months and gives the Company an unconditional
right, but not the obligation, to purchase the partnership interest for
$120 million.  The Company has engaged an investment bank to explore
alternatives for a major redevelopment of the property.  The amount and
timing of any future expenditure, and the extent of any impact on existing
operations, will depend on the nature of the redevelopment ultimately
undertaken by the Company.

RAMADA EXPRESS

Ramada Express Hotel and Casino is located on approximately 28 acres in
Laughlin, Nevada, which is situated on the Colorado River at Nevada's
southern tip.  The facility features a Victorian-era railroad theme, which
includes a train that carries guests between the parking areas and the
casino hotel.  Ramada Express has 1,500 hotel rooms; a 50,000-square-foot
casino containing 1,600 slot machines and 37 table games; a 1,100-vehicle
parking garage; additional surface parking for 1,200 vehicles; three
restaurants and a lounge; and special event and retail space.

CASINO AZTAR EVANSVILLE 

Casino Aztar Evansville, the first casino gaming facility to open in
Indiana, operates on the Ohio River in Evansville, Indiana.  The casino
riverboat is certified to carry 2,700 passengers and a crew of 300.  The
facility contains approximately 37,250 square feet of casino space with
1,359 slot machines and 73 table games.  The casino opened in December 1995
with temporary facilities, including an approximately 13,000-square-foot
pavilion and surface parking.  In October 1996, the Company opened its
approximately 40,000-square-foot passenger pavilion and 1,600-space parking
garage.  The pavilion has passenger ticketing facilities, three
restaurants, a sidewalk cafe, an entertainment lounge and a gift shop.  In
December 1996, the Company opened a 250-room hotel.

Approximately 650,000 persons live within 50 miles of Casino Aztar
Evansville, and more than 3 million persons live within 120 miles,
including the metropolitan Louisville, Kentucky area.  The Company believes
that Casino Aztar Evansville is well placed to further solidify its 
position in the regional market prior to additional competition emerging on
the Ohio River in the Louisville, Kentucky market area. Direct competition
in the Louisville market is expected to open in the summer of 1998.  

CASINO AZTAR CARUTHERSVILLE 

Casino Aztar Caruthersville operates on a 37-acre site on the Mississippi
River in Caruthersville, Missouri near Interstates 55 and 155.  The casino
riverboat has a capacity of 800 passengers plus crew and contains
approximately 10,400 square feet of casino space with 436 slot machines and
27 table games.  A passenger pavilion provides ticketing and pre-boarding
facilities, including a restaurant, a sports lounge, a snack bar and other
amenities.  During 1997, the Company opened a climate-controlled pavilion
and an outdoor arena.  These facilities are used for exhibitions,
entertainment, rodeo competitions and other events.  The Company has some
unused land at this site and is searching for development opportunities 

                                      5
<PAGE>
with other entities to use the land for facilities that would complement
the Company's operations.  Other main elements are a barge at river's edge
for passenger boarding and disembarking, and parking for more than 1,000
vehicles, including recreational vehicles.

Approximately 634,000 persons live within 60 miles of Casino Aztar
Caruthersville in a relatively rural region whose population is widely
dispersed and has proven difficult to attract.  Approximately 2.2 million
people live within 100 miles of Casino Aztar Caruthersville, an area which
encompasses Memphis, Tennessee.  

YEAR 2000

Management has initiated an enterprise-wide program to prepare the
Company's computer systems and applications for the year 2000.  This is
necessary because computer programs have been written using two digits
rather than four to define the applicable year.  The Company expects to
incur internal staff costs as well as consulting and other expenses related
to infrastructure and facilities enhancements necessary to prepare the
systems for the year 2000.  Tropicana Atlantic City has undertaken a $6
million capital program, which is expected to be complete by September
1999, to purchase upgrades for its major hardware and software systems. 
When this capital program is completed, the Atlantic City Tropicana should
have addressed most of its year 2000 issues.  Tropicana Las Vegas and
Ramada Express are still evaluating their year 2000 issues.  The costs of
testing and conversion are not yet known, although they are not expected to
be material.  Casino Aztar Evansville and Casino Aztar Caruthersville use
primarily third-party standard vendor software and are working with such
vendors to ensure year 2000 compliance.  The Company expects its year 2000
date conversion projects to be completed on a timely basis.  However, there
can be no assurance that the systems of other companies on which the
Company's systems rely will be timely converted or that any such failure to
convert by another company would not have an adverse effect on the
Company's systems.

COMPETITION AND SEASONALITY

  Competition

The Company faces intense competition in each of the markets in which its
land-based gaming facilities are located from other companies in the gaming
industry, some of which have significantly greater financial resources than
the Company.  Such competition results, in part, from the geographic
concentration of competitors.  All of the Company's land-based casinos
primarily compete with other casinos in their immediate geographic area.
The Company's riverboat casinos primarily compete with other riverboat
casinos in nearby states, such as the riverboat casino in Metropolis,
Illinois.  In addition, riverboat casinos in Mississippi attract residents
of Casino Aztar Caruthersville's secondary Memphis, Tennessee market. 
Casino Aztar Caruthersville also competes to a lesser extent with riverboat
casinos in other cities in Missouri, none of which are in its primary 60-
mile radius market area.  Casino Aztar Evansville also competes with two
other Indiana riverboat casinos on the Ohio River in the Cincinnati, Ohio
market area and will compete with one in the Louisville, Kentucky market
area when it opens.  In addition, Indiana law allows one more riverboat
casino to be operated on the Ohio River if and when the Indiana Gaming
Commission decides to issue another license.  Casino Aztar Evansville also 

                                      6
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competes to a lesser extent with riverboat casinos in other Indiana
locations, none of which are in its primary 50-mile radius market area. 
All of the Company's casinos compete to a lesser extent with casinos in
other locations, including Native American lands and on cruise ships, and
with other forms of legalized gaming in the United States, including state-
sponsored lotteries, off-track wagering and card parlors.  Several states
have considered legalizing casino gaming and others may in the future. 
Legalization of large-scale, unlimited casino gaming in or near any major
metropolitan area or increased gaming in other areas could have an adverse
economic impact on the business of any or all of the Company's gaming
facilities.  There can be no assurance that the Company will be able to
compete successfully in these markets.

As of January 1, 1998, there were 11 casino hotel facilities operating in
Atlantic City in competition with Tropicana Atlantic City.  Although no new
casinos have been opened in Atlantic City since April 1990, many of the
existing casinos have increased their gaming capacities in 1994 through
1996 and a major expansion at one casino hotel opened in July 1997.  Two
other casino hotels are scheduled to open major expansions of their gaming
capacities in 1998 and 1999.  Other companies have announced a desire to
open casino hotels in the future.  The addition of new casino hotels in the
Atlantic City market could have the effect of expanding the market or it
could increase competition for the existing market.  In 1992, the
Mashantucket Pequot tribe began operating the Foxwoods High Stakes Casino
and Bingo Hall, one of the largest casinos in the United States, in
Ledyard, Connecticut.  The Mohegan tribe began operating a casino in
Connecticut in 1996 and, in December 1997, announced plans for a major
expansion of this facility; however, no timetable for completion is
available.  In addition, slot machines have been added to race tracks in
Delaware and West Virginia.  The adoption of legislation approving casino
gaming in any jurisdiction near New Jersey, particularly Delaware,
Maryland, New York or Pennsylvania, could have a material adverse effect on
the Atlantic City market, depending on the form and scope of such gaming.

Since the Mirage opened in late 1989, there have been several other major
casino hotels opened on the Strip.  In addition, casino hotels have opened
or have been expanded in other parts of Las Vegas or near Las Vegas. 
Downtown Las Vegas has added the "Fremont Street Experience" that provides
a cover for the street and light show in order to attract customers.  Four 
major casino hotels on the Strip are under construction and announcements
have been made for other new developments.  In addition, one major casino
hotel has announced plans for a major expansion of capacity.  The
experience through 1997 has been that these new developments have expanded
the Las Vegas market.  There can be no assurance, however, that the
increased competition from the new casinos will not have an adverse effect
on Tropicana Las Vegas.

In the Laughlin market, there have been expansions of existing casino
hotels and in February 1995, the Mojave tribe opened a casino hotel in
Nevada approximately 8 miles south of Laughlin.  The Laughlin market has
been affected by the Native American casinos in Arizona and California and
additional capacity in Las Vegas and the surrounding area.






                                      7
<PAGE>
Competition involves not only the quality of casino, room, restaurant,
entertainment and convention facilities, but also room, food and beverage
prices.  The level of gaming activity also varies significantly from time
to time depending on general economic conditions, marketing efforts, hotel
occupancies and the offering of special events and promotions.  The extent
and quality of complimentary services to attract high-stakes players and,
in Atlantic City, casino customers arriving under bus programs, the
personal attention offered to guests and casino customers, advertising,
entertainment, slot machine pay-out rates and credit policies with respect
to high-stakes players are also important competitive factors.  As a
result, operating results can be adversely affected by significant cash
outlays for advertising and promotion and complimentary services to
patrons, the amount and timing of which are partially dictated by the
policies of competitors.  If operating revenues are insufficient to allow
management the flexibility to match the promotions of competitors, the
number of the Company's casino patrons may decline, with an adverse effect
on its financial performance.  

  Seasonality

Tropicana Atlantic City experiences seasonal fluctuations in casino play
that management believes are typical of casino hotel operations in Atlantic
City.  Operating results indicate that casino play is seasonally higher
during the months of May through October; consequently the Company's
revenues during the first and fourth quarters have generally been lower
than for the second and third quarters and from time to time the Company
has experienced losses in the first and fourth quarters.  Because the
Atlantic City Tropicana's operating results are especially dependent upon
operations in the summer months, any event that adversely affects the
operating results of the Atlantic City Tropicana during such period could
have a material adverse effect on the Company's operations and financial
condition.  Given Atlantic City's location, it is also subject to
occasional adverse weather conditions such as storms and hurricanes that
would impede access to Atlantic City, thus adversely impacting operations. 

The gaming markets in Las Vegas and Laughlin experience a slight decrease
in gaming activity in the hot summer months and during the holiday period
between Thanksgiving and Christmas.  The Company's casino riverboats
experience higher casino revenues in the spring and summer months than in
the fall and winter months.

CREDIT POLICY AND CONTROL PROCEDURES

As is customary in the gaming industry and necessitated by competitive
factors, the Company's gaming activities are conducted on a credit as well
as a cash basis, except in Missouri, which prohibits gaming on a credit
basis.  Credit policies vary widely from one operator to another and are
largely dependent on the profile of the targeted customers.  Table games
players, for example, are typically extended more credit than slot players,
and high-stakes players are typically extended more credit than patrons who
tend to wager lower amounts.  The Company currently markets to customers in
all gaming segments; however, its credit policy varies from facility to
facility based upon the various types of customers at each facility. 
Gaming debts are legally enforceable under the current laws of New Jersey
and Nevada; it is not clear, however, that all other states or that foreign
countries will honor these policies.  Enforceability of gaming debts in
Indiana is uncertain.  The uncollectibility of gaming receivables could 

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have a material adverse effect on results of operations.  Provisions for
estimated uncollectible gaming receivables have been made in order to
reduce gaming receivables to amounts deemed to be collectible.

Gaming operations at the casinos are subject to risk of substantial loss as
a result of employee or patron dishonesty, credit fraud or illegal slot
machine manipulation.  The Company has in place stringent control
procedures to minimize such risks; however, there can be no assurance that
losses will not occur.  Current controls include supervision of employees,
monitoring by electronic surveillance equipment and use of two-way mirrors.
In New Jersey, the Company's activities are observed and monitored on an
ongoing basis by agents of both the New Jersey Casino Control Commission
and the New Jersey Division of Gaming Enforcement, each of which maintains
a staff on the premises of Tropicana Atlantic City.  Similarly, in Nevada
the Company's gaming subsidiaries must comply with certain regulatory
requirements concerning casino and game security and surveillance, and the
gaming operations of Tropicana Las Vegas and Ramada Express are subject to
routine audit and supervision by agents of the Nevada State Gaming Control
Board.  In Missouri and Indiana, the Company's casino riverboat operations
are subject to the control procedures of the Missouri Gaming Commission and
the Indiana Gaming Commission, respectively.  The Missouri Gaming
Commission maintains a staff at Casino Aztar Caruthersville and the Indiana
Gaming Commission maintains a staff at Casino Aztar Evansville.

REGULATION

  General

Regulatory aspects of the gaming business are pervasive in nature and the
following description should not be construed as a complete summary of all
the regulatory requirements faced by the Company.  Gaming authorizations,
once obtained, can be suspended or revoked for a variety of reasons.  If
the Company were ever precluded from operating one of its gaming
facilities, it would, to the extent permitted by law, seek to recover its
investment by sale of the property affected, but there can be no assurance
that the Company would recover its full investment.  

From time to time, legislative and regulatory changes are proposed, and
court decisions rendered, that could be adverse to the Company.  In
addition, from time to time, investigations are conducted relating to the
gaming industry.  Tropicana Atlantic City, Casino Aztar Caruthersville and
Casino Aztar Evansville are required to report certain cash transactions to
the U.S. Department of the Treasury pursuant to the Bank Secrecy Act. 
Violation of the reporting requirements of the Bank Secrecy Act could
result in civil as well as criminal penalties including fines and/or
imprisonment, which in turn could result in the revocation, suspension,
imposition of conditions upon or failure to renew the casino license of the
affected facility.  The States of Nevada and Indiana have adopted
regulations similar to the Bank Secrecy Act which requires the Nevada and
Indiana facilities to document and/or report certain currency transactions
to the Nevada State Gaming Control Board and the Indiana Gaming Commission,
respectively.  Violation of these regulations could result in action by
Nevada or Indiana authorities to fine or revoke, suspend, impose conditions
upon or fail to renew the Nevada or Indiana facilities' licenses and/or the
Company's licensing approval.  Except to the extent of a violation as noted
above, these reporting requirements are not expected to have any adverse
effects on the Company's casino operations.

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  Regulation and Licensing - Nevada

The ownership and operation of casino gaming facilities in Nevada are
subject to: (i) the Nevada Gaming Control Act and the regulations
promulgated thereunder (collectively, the "Nevada Act"); and (ii) various
local regulations.  The gaming operations of the Tropicana Las Vegas and
Ramada Express are subject to the licensing and regulatory control of the
Nevada Gaming Commission (the "Nevada Commission"), the Nevada State Gaming
Control Board (the "Nevada Board") and the Clark County Liquor and Gaming
Licensing Board (the "Clark County Board") (collectively, the "Nevada
Gaming Authorities").

The laws, regulations and supervisory procedures of the Nevada Gaming
Authorities are based upon declarations of public policy which are
concerned with, among other things; (i) the prevention of unsavory or
unsuitable persons from having a direct or indirect involvement with gaming
at any time or in any capacity; (ii) the establishment and maintenance of
responsible accounting practices and procedures; (iii) the maintenance of
effective controls over the financial practices of licensees, including the
establishment of minimum procedures for internal fiscal affairs and the
safeguarding of assets and revenues, providing reliable record keeping and 
requiring the filing of periodic reports with the Nevada Gaming
Authorities; (iv) the prevention of cheating and fraudulent practices; and
(v) the provision of a source of state and local revenues through taxation
and licensing fees.  Change in such laws, regulations and procedures could
have an adverse effect on the Company.

Hotel Ramada of Nevada ("HRN") is the Company's wholly-owned subsidiary
which operates the casino at Tropicana Las Vegas and Ramada Express, Inc.
("Express") is the Company's wholly-owned subsidiary which operates the
casino at Ramada Express.  HRN and Express are both required to be licensed
by the Nevada Gaming Authorities.  The gaming licenses require the periodic
payment of fees and taxes and are not transferable.  The Company is
registered by the Nevada Commission as a publicly traded corporation
("Registered Corporation") and as such, it is required periodically to
submit detailed financial and operating reports to the Nevada Commission
and furnish any other information which the Nevada Commission may require. 
No person may become a stockholder of, or receive any percentage of profits
from, HRN or Express without first obtaining licenses and approvals from
the Nevada Gaming Authorities.  The Company, HRN and Express have obtained
from the Nevada Gaming Authorities the various registrations, approvals,
permits and licenses required in order to engage in gaming activities in
Nevada.

The Nevada Gaming Authorities may investigate any individual who has a
material relationship to, or material involvement with, the Company, HRN or
Express in order to determine whether such individual is suitable or should
be licensed as a business associate of a gaming licensee.  Officers,
directors and certain key employees of HRN and Express must file
applications with the Nevada Gaming Authorities and may be required to be
licensed or found suitable by the Nevada Gaming Authorities.  Officers,
directors and key employees of the Company who are actively and directly
involved in gaming activities of HRN and Express may be required to be
licensed or found suitable by the Nevada Gaming Authorities.  The Nevada
Gaming Authorities may deny an application for licensing for any cause
which they deem reasonable.  A finding of suitability is comparable to
licensing, and both require submission of detailed personal and financial 

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information followed by a thorough investigation.  The applicant for
licensing or a finding of suitability must pay all the costs of the
investigation.  Changes in licensed positions must be reported to the
Nevada Gaming Authorities and in addition to their authority to deny an
application for a finding of suitability or licensure, the Nevada Gaming
Authorities have jurisdiction to disapprove a change in a corporate
position.

If the Nevada Gaming Authorities were to find an officer, director or key
employee unsuitable for licensing or unsuitable to continue having a
relationship with the Company, HRN or Express, the companies involved would
have to sever all relationships with such person.  In addition, the Nevada
Commission may require the Company, HRN or Express to terminate the
employment of any person who refuses to file appropriate applications. 
Determinations of suitability or of questions pertaining to licensing are
not subject to judicial review in Nevada.

The Company, HRN and Express are required to submit detailed financial and
operating reports to the Nevada Commission.  Substantially all material
loans, leases, sales of securities and similar financing transactions by
HRN and Express must be reported to, or approved by, the Nevada Commission.

If it were determined that the Nevada Act was violated by HRN or Express,
the gaming licenses held by HRN or Express could be limited, conditioned,
suspended or revoked, subject to compliance with certain statutory and
regulatory procedures.  In addition, HRN, Express, the Company and the
persons involved could be subject to substantial fines for each separate
violation of the Nevada Act at the discretion of the Nevada Commission. 
Further, a supervisor could be appointed by the Nevada Commission to
operate the Company's Nevada gaming properties and, under certain
circumstances, earnings generated during the supervisor's appointment
(except for the reasonable rental value of the Company's Nevada gaming
properties) could be forfeited to the State of Nevada.  Limitation,
conditioning or suspension of any gaming license or the appointment of a
supervisor could (and revocation of any gaming license would) materially
adversely affect the Company.

Any beneficial holder of the Company's voting securities, regardless of the
number of shares owned, may be required to file an application, be
investigated, and have his suitability as a beneficial holder of the
Company's voting securities determined if the Nevada Commission has reason
to believe that such ownership would otherwise be inconsistent with the
declared policies of the State of Nevada.  The applicant must pay all costs
of investigation incurred by the Nevada Gaming Authorities in conducting
any such investigation.

The Nevada Act requires any person who acquires more than 5% of the
Company's voting securities to report the acquisition to the Nevada
Commission.  The Nevada Act requires that beneficial owners of more than
10% of the Company's voting securities apply to the Nevada Commission for a
finding of suitability within thirty days after the Chairman of the Nevada
Board mails the written notice requiring such filing.  Under certain
circumstances, an "institutional investor," as defined in the Nevada Act,
which acquires more than 10%, but not more than 15%, of the Company's
voting securities may apply to the Nevada Commission for a waiver of such
finding of suitability if such institutional investor holds the voting
securities for investment purposes only.  An institutional investor shall 

                                     11
<PAGE>
not be deemed to hold voting securities for investment purposes unless the
voting securities were acquired and are held in the ordinary course of
business as an institutional investor and not for the purpose of causing,
directly or indirectly, the election of a majority of the members of the
board of directors of the Company, any change in the Company's corporate
charter, bylaws, management, policies or operations of the Company, or any
of its gaming affiliates, or any other action which the Nevada Commission
finds to be inconsistent with holding the Company's voting securities for
investment purposes only.  Activities which are not deemed to be
inconsistent with holding voting securities for investment purposes only
include: (i) voting on all matters voted on by stockholders; (ii) making
financial and other inquiries of management of the type normally made by
securities analysts for informational purposes and not to cause a change in
its management, policies or operations; and (iii) such other activities as
the Nevada Commission may determine to be consistent with such investment
intent.  If the beneficial holder of voting securities who must be found
suitable is a corporation, partnership or trust, it must submit detailed
business and financial information including a list of beneficial owners. 
The applicant is required to pay all costs of investigation.

Any person who fails or refuses to apply for a finding of suitability or a
license within thirty days after being ordered to do so by the Nevada
Commission or the Chairman of the Nevada Board, may be found unsuitable. 
The same restrictions apply to a record owner if the record owner, after
request, fails to identify the beneficial owner.  Any stockholder found
unsuitable and who holds, directly or indirectly, any beneficial ownership
of the common stock of a Registered Corporation beyond such period of time
as may be prescribed by the Nevada Commission may be guilty of a criminal
offense.  The Company is subject to disciplinary action if, after it
receives notice that a person is unsuitable to be a stockholder or to have
any other relationship with the Company, HRN or Express, the Company (i)
pays that person any dividend or interest upon voting securities of the
Company, (ii) allows that person to exercise, directly or indirectly, any
voting right conferred through securities held by that person, (iii) pays
remuneration in any form to that person for services rendered or otherwise,
or (iv) fails to pursue all lawful efforts to require such unsuitable
person to relinquish his voting securities for cash at fair market value. 
Additionally, the Clark County Board has taken the position that it has the
authority to approve all persons owning or controlling the stock of any
corporation controlling a gaming license.

The Nevada Commission may, in its discretion, require the holder of any
debt security of a Registered Corporation such as the Company to file
applications, be investigated and be found suitable to own the debt
security of a Registered Corporation.  If the Nevada Commission determines
that a person is unsuitable to own such security, then pursuant to the
Nevada Act, the Registered Corporation can be sanctioned, including the
loss of its approvals, if without the prior approval of the Nevada
Commission, it: (i) pays to the unsuitable person any dividend, interest,
or any distribution whatsoever; (ii) recognizes any voting right by such
unsuitable person in connection with such securities; (iii) pays the
unsuitable person remuneration in any form; or (iv) makes any payment to
the unsuitable person by way of principal, redemption, conversion,
exchange, liquidation, or similar transaction.

The Company is required to maintain a current stock ledger in Nevada which
may be examined by the Nevada Gaming Authorities at any time.  If any 

                                     12
<PAGE>
securities  are held in trust by an agent or by a nominee, the record
holder may be required to disclose the identity of the beneficial owner to
the Nevada Gaming Authorities.  A failure to make such disclosure may be
grounds for finding the record holder unsuitable.  The Company is also
required to render maximum assistance in determining the identity of the
beneficial owner.  The Nevada Commission has the power to require the
Company's stock certificates to bear a legend indicating that the
securities are subject to the Nevada Act.  However, to date, the Nevada
Commission has not imposed such a requirement on the Company.

The Company may not make a public offering of any securities without the
prior approval of the Nevada Commission if the securities or the proceeds
therefrom are intended to be used to construct, acquire or finance gaming
facilities in Nevada, or to retire or extend obligations incurred for such
purposes.  Such approval, if given, does not constitute a finding,
recommendation or approval by the Nevada Commission or the Nevada Board as
to the accuracy or adequacy of the prospectus or the investment merits of
the securities.  Any representation to the contrary is unlawful.

On May 22, 1997, the Nevada Commission granted the Company prior approval
to make public offerings for a period of two years subject to certain
conditions (the "Shelf Approval").  However, the Shelf Approval may be
rescinded for good cause without prior notice upon the issuance of an
interlocutory stop order by the Chairman of the Nevada Board.  The Shelf
Approval does not constitute a finding, recommendation or approval by the
Nevada Commission or the Nevada Board as to the accuracy or adequacy of the
prospectus or the investment merits of the securities offered.  Any
representation to the contrary is unlawful.

Changes in control of the Company through merger, consolidation, stock or
asset acquisitions, management or consulting agreements, or any act or
conduct by a person whereby he obtains control, may not occur without the
prior approval of the Nevada Commission.  Entities seeking to acquire
control of a Registered Corporation must satisfy the Nevada Board and
Nevada Commission in a variety of stringent standards prior to assuming
control of such Registered Corporation.  The Nevada Commission may also
require controlling stockholders, officers, directors and other persons
having a material relationship or involvement with the entity proposing to
acquire control, to be investigated and licensed as part of the approval
process relating to the transaction.

The Nevada legislature has declared that some corporate acquisitions
opposed by management, repurchases of voting securities and corporate
defense tactics affecting Nevada gaming licensees and Registered
Corporations that are affiliated with those operations, may be injurious to
stable and productive corporate gaming.  The Nevada Commission has
established a regulatory scheme to ameliorate the potentially adverse
effects of these business practices upon Nevada's gaming industry and to
further Nevada's policy to: (i) assure the financial stability of corporate
gaming operators and their affiliates; (ii) preserve the beneficial aspects
of conducting business in the corporate form; and (iii) promote a neutral
environment for the orderly governance of corporate affairs.  Approvals
are, in certain circumstances, required from the Nevada Commission before
the Company can make exceptional repurchases of voting securities above the
current market price thereof and before a corporate acquisition opposed by
management can be consummated.  The Nevada Act also requires prior approval
of a plan of recapitalization proposed by the Company's Board of Directors 

                                     13
<PAGE>
in response to a tender offer made directly to the Registered Corporation's
stockholders for the purposes of acquiring control of the Registered
Corporation.

License fees and taxes, computed in various ways depending on the type of
gaming or activity involved, are payable to the State of Nevada and to the
counties and cities in which the Nevada licensee's respective operations
are conducted.  Depending upon the particular fee or tax involved, these
fees and taxes are payable either monthly, quarterly or annually and are
based upon either: (i) a percentage of the gross revenues received; (ii)
the number of gaming devices operated; or (iii) the number of table games
operated.  A casino entertainment tax is also paid by HRN and Express where
entertainment is furnished in connection with the selling of food,
refreshments or merchandise in a cabaret, nightclub, cocktail lounge or
casino showroom.

Any person who is licensed, required to be licensed, registered, required
to be registered, or is under common control with such persons (a
"Licensee", or collectively, "Licensees"), and who proposes to become
involved in a gaming venture outside of Nevada is required to deposit with
the Nevada Board, and thereafter maintain, a revolving fund in the amount
of $10,000 to pay the expenses of investigation of the Nevada Board of
their participation in such foreign gaming.  The revolving fund is subject
to increase or decrease in the discretion of the Nevada Commission. 
Thereafter, Licensees are required to comply with certain reporting
requirements imposed by the Nevada Act.  A Licensee is also subject to
disciplinary action by the Nevada Commission if it knowingly violates any
laws of the foreign jurisdiction pertaining to the foreign gaming
operation, fails to conduct the foreign gaming operation in accordance with
the standards of honesty and integrity required of Nevada gaming
operations, engages in activities that are harmful to the State of Nevada
or its ability to collect gaming taxes and fees, or employs a person in the
foreign operation who has been denied a license or finding of suitability
in Nevada on the ground of personal unsuitability.

The sale of alcoholic beverages by HRN and Express is subject to licensing,
control and regulation by the Clark County Board.  All licenses are
revocable and are not transferable.  The Clark County Board has full power
to limit, condition, suspend or revoke any such license, and any such
disciplinary action could (and revocation would) have a material adverse
effect upon the operations of the Company, HRN or Express.

  Regulation and Licensing - New Jersey

The ownership and operation of casino hotel facilities and gaming
activities in Atlantic City, New Jersey, are subject to extensive state
regulation under the New Jersey Casino Control Act (the "New Jersey Act")
and the regulations of the New Jersey Casino Control Commission (the "New
Jersey Commission").  In general, the New Jersey Act and regulations
provide for more extensive controls over a broader scope of gaming-related
activities than does the Nevada regulatory system.

The New Jersey Act and regulations concern primarily the financial
stability and character of casino licensees, their intermediary and holding
companies, their employees, their security holders and others financially
interested in casino operations, the nature of hotel and casino facilities
and a wide range of gaming and non-gaming related operations.  The New 

                                     14
<PAGE>
Jersey Act and regulations include detailed provisions concerning, among
other things, financial and accounting practices used in connection with
casino operations, residence and equal employment opportunities for
employees of casino operators, contractors for casino facilities and
others; rules of games, levels of supervision of games and methods of
selling and redeeming chips; manner of granting credit, duration of credit
and enforceability of gaming debts; manufacture, distribution and sale of
gaming equipment; security standards, management control procedures,
accounting and cash control methods and reports to gaming authorities;
advertising of casinos and standards for entertainment and distribution of
alcoholic beverages in casinos.  A number of these provisions require
practices which are different from those in Nevada and some of them result
in casino operating costs being higher than those in comparable facilities
in Nevada.

The New Jersey Act also established the New Jersey Division of Gaming
Enforcement (the "New Jersey Division") to investigate all license
applications, enforce the provisions of the New Jersey Act and attendant
regulations and prosecute all proceedings for violations of the New Jersey
Act and regulations before the New Jersey Commission.  The New Jersey
Division also conducts audits and continuing reviews of all casino
operations.

Adamar of New Jersey, Inc. ("Adamar"), a wholly-owned subsidiary of the
Company, has been licensed (subject to quadrennial renewal) by the New
Jersey Commission to operate Tropicana Atlantic City.  In November 1982,
the New Jersey Commission granted a plenary license to Adamar.  In November
1995, the license was renewed for a period of four years.  The Company and
Ramada New Jersey Holdings Corporation ("Holdings"), another of the
Company's New Jersey gaming subsidiaries, have been approved as qualified
holding companies for Adamar's casino license.  Officers and directors of
the Company, Holdings and Adamar and employees who work at casino hotel
facilities operated by Adamar also have been or must be qualified, licensed
or registered.  In addition, all contracts affecting the facilities are
subject to approval, and all enterprises that conduct business with Adamar
must register with the New Jersey Commission and those enterprises that
conduct gaming related businesses or that conduct business on a regular and
continuing basis, as defined by the regulations under the New Jersey Act,
must be licensed by the New Jersey Commission.

The New Jersey Commission has broad discretion regarding the issuance,
renewal, revocation and suspension of casino licenses.  Casino licenses are
not transferable.  A casino hotel facility must also continually satisfy
certain requirements concerning, among other things, the number of
qualifying sleeping units and the relationship between the number of
qualifying sleeping units and the square footage of casino space.  The
Company believes that Tropicana Atlantic City continues to meet such
requirements.  

The New Jersey Act further provides that each person who directly or
indirectly holds any beneficial interest or ownership of the securities
issued by a casino licensee or any of its intermediary or holding
companies, those persons who, in the opinion of the New Jersey Commission,
have the ability to control the casino licensee or its intermediary or
holding companies or elect a majority of the board of directors of said
companies, other than a banking or other licensed lending institution which
makes a loan or holds a mortgage or other lien acquired in the ordinary 

                                     15
<PAGE>
course of business, and lenders and underwriters of said companies may be
required to seek qualification from the New Jersey Commission. However,
because the Company is a publicly traded holding company, in accordance
with the provisions of the New Jersey Act, a waiver of qualification may be
granted by the New Jersey Commission, with the concurrence of the Director
of the New Jersey Division, if it is determined that said persons or
entities are not significantly involved in the activities of Adamar and, in
the case of security holders, do not have the ability to control the
Company or elect one or more of its directors.  There exists a rebuttable
presumption that any person holding 5% or more of the equity securities of
a casino licensee's intermediary or holding company or a person having the
ability to elect one or more of the directors of such a company has the
ability to control the company and thus must obtain qualification from the
New Jersey Commission.

Notwithstanding this presumption of control, the New Jersey Act provides
for a waiver of qualification for passive "institutional investors," as
defined by the New Jersey Act, if the institutional investor purchased the
securities for investment purposes only and where such securities
constitute (i) less than 10% of the equity securities of a casino
licensee's holding or intermediary company or (ii) debt securities of a
casino licensee's holding or intermediary company representing a percentage
of the outstanding debt of such company not exceeding 20% or a percentage
of any issue of the outstanding debt of such company not exceeding 50%. 
The waiver of qualification is subject to certain conditions including,
upon request of the New Jersey Commission, filing a certified statement
that the institutional investor has no intention of influencing or
affecting the affairs of the issuer.  Additionally, a waiver of
qualification may also be granted to institutional investors holding a
higher percentage of securities of a casino licensee's holding or
intermediary company upon a showing of good cause.

If the institutional investor is granted such a waiver and subsequently
determines to influence or affect the affairs of the issuer, it must
provide not less than 30 days notice of such intent and file with the New
Jersey Commission an application for qualification before taking any action
which may influence or affect the affairs of the issuer, except that an
institutional investor holding voting securities shall be permitted to vote
on matters put to the vote of the holders of outstanding voting securities. 
If an institutional investor that has been granted a waiver subsequently
changes its investment intent, or if the New Jersey Commission finds
reasonable cause to believe that the institutional investor may be found 
unqualified, no action other than divestiture shall be taken by the
investor with respect to the security holdings until the investor complies
with the provisions of the New Jersey Act concerning Interim Casino
Authorization.  The provisions of the New Jersey Act concerning Interim
Casino Authorization provide that whenever a security holder of either
equity or debt is required to qualify pursuant to the New Jersey Act, the
security holder shall, within 30 days after the New Jersey Commission
determines that qualification is required or declines to waive
qualification, (i) file a completed application for qualification, along
with an executed and approved Trust Agreement, wherein all securities of
the holding or intermediary company held by that security holder are placed
in trust pending qualification, or (ii) file a notice of intent to divest
itself of such securities as the New Jersey Commission may require so as to
remove the need for qualification, which securities must be divested within
120 days from the date such determination was made.

                                     16
<PAGE>
The New Jersey Act further requires that corporate licensees and their
subsidiaries, intermediaries and holding companies adopt certain provisions
in their certificates of incorporation that require certain remedial action
in the event that an individual owner of any security of such company is
found disqualified under the New Jersey Act.  The required certificate of
incorporation provisions vary depending on whether the stock of the company
subject to the requirements of the New Jersey Act is publicly or privately
traded.  Pursuant to the New Jersey Act, the certificate of incorporation
of a publicly held company must provide that any securities of such
corporation are held subject to the condition that if a holder is found to
be disqualified by the New Jersey Commission pursuant to the New Jersey Act
such holder shall dispose of his interest in such company.  The certificate
of incorporation of a privately held company must create the absolute right
of the company to repurchase at the market price or purchase price,
whichever is the lesser, any security, share or other interest in the
company in the event the New Jersey Commission disapproves a transfer in
accordance with the provisions of the New Jersey Act.

The Company is a publicly held company and, accordingly, a provision has
been placed in the Company's Restated Certificate of Incorporation which
provides that a holder of the Company's securities must dispose of such
securities if the holder is found disqualified under the New Jersey Act. 
In addition, the Restated Certificate of Incorporation for the Company
provides that the Company may redeem the stock of any holder found to be
disqualified.

If, at any time, it is determined that Adamar has violated the New Jersey
Act or regulations, or if any security holder of the Company, Adamar or
Holdings who is required to be qualified under the New Jersey Act is found
disqualified but does not dispose of the securities, Adamar could be
subject to fines or its license could be suspended or revoked.  If Adamar's
license is revoked, the New Jersey Commission could appoint a conservator
to operate and to dispose of any casino hotel facilities of Adamar.  Net
proceeds of a sale by a conservator and net profits of operations by a
conservator (at least up to an amount equal to a fair return on Adamar's
investment which is reasonable for casinos or hotels) would be paid to
Adamar.

In addition to compliance with the New Jersey Act and regulations relating
to gaming, any facility built in Atlantic City by Adamar or any other
subsidiary of the Company must comply with the New Jersey and Atlantic City
laws and regulations relating to, among other things, the Coastal Area
Facilities Review Act, construction of buildings, environmental
considerations, operation of hotels and the sale of alcoholic beverages.

The New Jersey Commission is authorized to establish fees for the issuance
or renewal of casino licenses.  Yearly casino hotel alcoholic beverage
license fees are payable for each facility in any of five specified
categories in any licensed casino hotel.  There is also an annual license
fee on each slot machine.  The New Jersey Commission is also authorized by
regulation to establish annual fees for the issuance and renewal of
licenses other than casino licenses.

The New Jersey Act imposes an annual tax of eight percent on gross revenues
(as defined in the New Jersey Act).  In addition, casino licensees are
required to invest one and one-quarter percent of gross casino revenues for
the purchase of bonds to be issued by the Casino Reinvestment Development 

                                     17
<PAGE>
Authority or make other approved investments equal to that amount; in the
event the investment requirement is not met, the casino licensee is subject
to a tax in the amount of two and one-half percent on gross revenues.

  Regulation and Licensing - Missouri

On November 3, 1992, a statewide referendum authorized gaming in the state
of Missouri on the Missouri and the Mississippi Rivers.  Local approval
from the home dock municipality, as required by the legislation, was also
obtained from the City of Caruthersville in the November 3, 1992 election. 
On April 29, 1993, Missouri enacted revised legislation (the "Missouri
Gaming Law") which amended the existing legislation.  The Missouri Gaming
Law established the Missouri Gaming Commission, which is responsible for
the licensing and regulation of riverboat gaming in Missouri and has the
discretion to approve license applications for riverboat gaming facilities. 
In July 1993, the Company was chosen by the City of Caruthersville as the
preferred applicant to develop a gaming facility, and on September 20,
1993, the Company's subsidiary, Aztar Missouri Gaming Corporation ("Aztar
Missouri"), filed its initial application with the Missouri Gaming
Commission.  The Missouri Gaming Commission conducted a formal
investigation of Aztar Missouri's application and granted an owner/operator
gaming license to Aztar Missouri on April 26, 1995.

In a decision handed down on January 25, 1994, the Missouri Supreme Court
held that games of chance were prohibited under the Missouri constitution.
On April 5, 1994, Missouri voters narrowly defeated the adoption of a
constitutional amendment that would have excepted excursion boats and
floating facilities from the constitutional prohibition on lotteries. 
Local voters did re-approve gaming in the City of Caruthersville in the
April 5, 1994 election.  Following the April 5, 1994 election, the Missouri
legislature amended the existing Missouri Gaming Law to clarify certain
definitions and to resolve some constitutional questions raised in the
Missouri Supreme Court decision.  Pursuant to the Missouri Gaming Law, as
revised, the Missouri Gaming Commission has issued eleven gaming licenses
throughout the state: one in Caruthersville, four in the St. Louis area,
five in the Kansas City area, and one in St. Joseph.

In a statewide election held on November 8, 1994, Missouri voters approved
the adoption of an amendment to the Missouri Constitution which permits the
legislature to allow games of chance to be conducted on excursion boats and
floating facilities on the Mississippi River and the Missouri River.  As a
result of the amendment, full-scale gaming is now available in Missouri.

Opponents of gaming in Missouri have brought several legal challenges to
gaming in the past and may possibly bring similar challenges in the future. 
On November 25, 1997, the Missouri Supreme Court overturned a state lower
court and held that a portion of the Missouri Gaming Law that authorized
excursion gaming facilities in "artificial basins" up to 1,000 feet from
the Mississippi or Missouri rivers was unconstitutional.  The legal status
of several excursion gaming riverboat facilities is still uncertain at this
point.  Aztar Missouri's gaming facilities are fully on the Mississippi
River, and do not, at this point, appear to be affected by this ruling.
There can be no assurances that any future challenges, if brought, would
not further interfere with full-scale gaming operations in Missouri,
including the operations of Aztar Missouri.



                                     18
<PAGE>
Under the Missouri Gaming Law, the ownership and operation of riverboat
gaming facilities in Missouri are subject to extensive state and local
regulation.  Aztar, Aztar Missouri, any subsidiaries, and certain of their
officers and employees are and will be subject to certain regulations.  As
part of the application and licensing process for a gaming license, the
applicant must submit detailed financial, operating and other reports to
the Missouri Gaming Commission.  Each applicant has an ongoing duty to
update the information provided to the Missouri Gaming Commission in the
application.  Aztar Missouri has frequently updated its application
materials since it was initially licensed.  In addition to the information
required of the applicant, directors, officers and other key persons must
submit Personal Disclosure Forms which include detailed personal financial
information and are subject to thorough investigations.  In addition,
certain officers and directors of Aztar, as well as Aztar itself, have
submitted Personal Disclosure Forms to the Missouri Gaming Commission.  All
gaming employees must obtain an occupational license issued by the Missouri
Gaming Commission.

The operators' licenses are issued through application to the Missouri
Gaming Commission, which requires, among other things, (a) investigations
into an applicant's character, financial responsibility and experience
qualifications and (b) that applicants furnish (i) an affirmative action
plan for the hiring and training of minorities and women and (ii) an
economic development or impact report.  License fees are a minimum of
$50,000 for the initial application and $25,000 annually thereafter.  

Licenses are to last for a term of two years, except that the initial
license and first renewal granted to each gaming operator are to be for
terms of one year.  Aztar Missouri was relicensed in 1996 for its first
renewal period and was relicensed on July 1, 1997 for its second renewal
period.  Aztar Missouri will need to renew its license next in 1999, and at
that time will be investigated, along with its officers, directors and
certain employees, and considered for relicensing.  Aztar and its directors
may also be investigated pursuant to this relicensing procedure.  Aztar
Missouri has no reason at this point to believe that such renewal
applications will not be approved.  However, there can be no assurance that
Aztar Missouri's renewal application will be approved in a timely manner or
at all.  

The Missouri Gaming Commission may revoke or suspend gaming licenses and
impose other penalties for violations of the Missouri Gaming Law and the
rules and regulations promulgated thereunder, including without limitation,
forfeiture of all gaming equipment used for improper gaming and fines of up
to three times an operator's highest daily gross adjusted receipts during
the preceding twelve months.  The gaming licenses may not be transferred
nor pledged as collateral, and the Missouri Gaming Law regulations bar a
licensee from taking any of the following actions without prior notice to,
and approval by, the Missouri Gaming Commission: any issuance of an
ownership interest of five percent or more of the issued and outstanding
ownership interest, any private incurrence of debt by the licensee or any
holding company of $1,000,000 or more, and any public issuance of debt by a
licensee or its holding company.  In addition, the licensee must notify the
Missouri Gaming Commission of other transactions, including the transfer of
five percent or more of an ownership interest in the licensee or holding
company, the pledge of five percent or more of the ownership interest in a
licensee or holding company, and any transaction of at least $1,000,000.
The restrictions on transfer of ownership apply to the Company as well as
the direct licensee, Aztar Missouri.
                                     19
<PAGE>
Missouri statutes and administrative rules contain detailed requirements
concerning the operation of a licensed excursion gaming boat facility. 
These include a charge of two dollars per gaming customer that licensees
must pay to the Missouri Gaming Commission, requirements regarding minimum
payouts, a 20% tax on adjusted gross receipts, prohibitions against
providing credit to gaming customers (except for the use of credit cards
and cashing checks) and a requirement that each licensee reimburse the
Missouri Gaming Commission for all costs of any Missouri Gaming Commission
staff necessary to protect the public on the licensee's riverboat. 
Licensees also must submit audited quarterly financial reports to the
Missouri Gaming Commission and pay the associated auditing fees.  Other
areas of operation which are subject to regulation under the Missouri rules
are the size, denomination and handling of chips and tokens; the
surveillance methods and computer monitoring of electronic games;
accounting and audit methods and procedures; and approval of an extensive
internal control system.  The Missouri rules also require that all of an
operator's purchases must be from suppliers licensed by the Missouri Gaming
Commission.

Although the Missouri Gaming Law provides no limit on the amount of
riverboat space that may be used for gaming, the Missouri Gaming Commission
is empowered to impose such space limitations through the adoption of rules
and regulations.  Additionally, United States Coast Guard safety
regulations could affect the amount of riverboat space that may be devoted
to gaming.  In addition, the Missouri Gaming Law imposes a $500 loss limit
per cruise and requires licensees to maintain scheduled cruises or
excursions with boarding and de-boarding times, regardless of whether a
gaming riverboat actually cruises the river, or has been granted continuous
docking status pursuant to the Missouri Gaming Law, as described below.

With respect to the availability of dockside gaming, which may be more
profitable than cruise gaming, the Missouri Gaming Commission is empowered
to determine on a city and county-specific basis where such gaming is
appropriate and shall be permitted.  Dockside gaming in Missouri may differ
from dockside gaming in other states, because the Missouri Gaming
Commission has the ability to require "simulated cruising".  This
requirement would permit customers to board dockside riverboats only at
specified times and would prohibit boarding during the period of a
simulated cruise, which is expected to last for two to three hours. 
However, customers are permitted to leave the facility at any time.  The 
Missouri Gaming Commission has authorized all eleven licensees to operate
all or a portion of their facilities on a continuously docked basis with a
"simulated cruise" schedule.  On February 15, 1996, the Commission granted
Aztar Missouri the authority to, if licensed, operate gambling games on
part of its floating facility, previously used for non-gaming activities,
such as ticketing, under the continuous docking provision of the Missouri
Gaming Law.  On February 15, 1997, the Commission granted Aztar Missouri
the authority to permanently dock the riverboat facility, the "City of
Caruthersville". 

  Regulation and Licensing - Indiana

The ownership and operation of riverboat casinos in certain designated
waters are subject to extensive state regulation under the Indiana
Riverboat Gambling Act (the "Indiana Act") and regulations which the
Indiana Gaming Commission is authorized to adopt under the Indiana Act. 
The Indiana Act and the regulations the Indiana Gaming Commission has 

                                     20
<PAGE>
adopted to date and is expected to adopt in the future are significant to
the Company's prospects for successfully operating its Evansville, Indiana
based riverboat casino and associated developments.

The Indiana Act extends broad and pervasive regulatory powers and authority
to the Indiana Gaming Commission.  The Indiana Gaming Commission took
office in September 1993, and, thus far, its activities have been
predominantly directed toward establishing a regulatory and administrative
infrastructure for licensing of prospective applicants for the limited
number of riverboat owner's licenses authorized by the Indiana Act (five
for operations docking on Lake Michigan, one on a landlocked lake in
Southwestern Indiana and five on the Ohio River, including the Company's
facility in Evansville, Indiana), and on developing systems and "rules of
the game" for the actual operation of riverboat casinos.  The Indiana
Gaming Commission has issued (i) the five authorized riverboat owner's
licenses on Lake Michigan, (ii) three riverboat owner's licenses on the
Ohio River, including the Company's facility, and (iii) a certificate of
suitability to another applicant for a fourth facility, subject to final
licensure, on the Ohio River.  The Indiana Gaming Commission has adopted a
set of regulations under the Indiana Act which covers numerous operational
matters concerning riverboat casinos licensed by the Commission and has
proposed other rules for adoption.

Among regulations adopted is one dealing with riverboat excursions, routes
and public safety.  The Indiana Act requires licensed riverboat casinos to
be cruising vessels and the regulations carry out the legislative intent
with appropriate recognition of public safety needs.  The regulations
explicitly preclude "dockside gambling".  Riverboat gaming excursions are
limited to a duration of up to four hours unless expressly approved by the
Indiana Gaming Commission.  No gaming may be conducted while the boat is
docked except (1) for 30-minute time periods at the beginning and end of a
cruise while the passengers are embarking and disembarking, (2) if the
master of the riverboat reasonably determines that specific weather or
water conditions present a danger to the riverboat, its passengers and
crew, (3) if either the vessel or the docking facility is undergoing
mechanical or structural repair, (4) if water traffic conditions present a
danger to (A) the riverboat, riverboat passengers and crew or (B) other
vessels on the water, or (5) if the master has been notified that a
condition exists that would cause a violation of Federal law if the
riverboat were to cruise.  However, a riverboat licensee must allow patrons
to disembark at anytime the riverboat remains at the dock and gambling
continues.  For Ohio River excursions, such as those the Company is
conducting through its Evansville operation, "full excursions" must be
conducted at all times during a year unless the master determines
otherwise, for the above-stated reasons. A "full excursion" is a cruise on
the Ohio River.

The Company, through an Indiana subsidiary, has received from the Indiana
Gaming Commission a riverboat owner's license for the Evansville, Indiana
market.  The Company has completed requirements for formal licensing and
commenced operations in Evansville on December 7, 1995.  The Ohio River has
waters in both Indiana and Kentucky in the Evansville vicinity.  Because
riverboat casino gambling is illegal in Kentucky, authorities of that state
have raised issues about Indiana-licensed riverboats operating in Kentucky
waters.  The Company's Evansville riverboat cruises from its dock without
entering Kentucky waters, under its currently approved cruising route,
thereby avoiding those issues.

                                     21
<PAGE>
A riverboat owner's license has an initial effective period of five years
but is subject to an annual renewal thereafter.  The Indiana Gaming
Commission has broad discretion with respect to the initial issuance of
licenses and also with respect to the renewal, revocation, suspension and
control of riverboat owner's licenses.  The Act requires a reinvestigation
after three years to ensure the owner continues to be suitable for
licensure.  Officers, directors and principal owners of the actual license
holder and employees who are to work on the riverboat are subject to
substantial disclosure requirements as a part of securing and maintaining
necessary licenses.  Significant contracts are subject to disclosure.  A
riverboat owner licensee may not enter into or perform any contract or
transaction in which it transfers or receives consideration which is not
commercially reasonable and which does not reflect the fair market value of
the goods or services rendered or received.  All contracts are subject to
disapproval by the Indiana Gaming Commission.  Suppliers of gaming
equipment and materials must also be licensed under the Indiana Act.  The
present license expires in December 2000.  Under the Act, the Indiana
Gaming Commission will reinvestigate the suitability of the Company in
December 1998.

The Indiana Act requires licensees to disclose to the Indiana Gaming
Commission the identity of all directors, officers and persons holding
direct or indirect beneficial interests of 1% or greater.  The Indiana
Gaming Commission also requires a broad and comprehensive disclosure of
financial and operating information on licensees and their principal
officers.  The Company has provided full information and documentation to
the Indiana Gaming Commission, and it must continue to do so, during the
license.  The Indiana Act prohibits a key person or a person holding an
ownership interest in a riverboat licensee, or an employee of a riverboat
licensee, from participating in a game conducted on a riverboat which is
the subject of a license.  The Indiana Act prohibits contributions to a
candidate for a state, legislative, or local office, or to a candidate's
committee or to a regular party committee by the holder of a riverboat
owner's license or a supplier's license, by an officer of a licensee, by an
officer of a person that holds at least a 1% interest in the licensee, or
by a person holding at least a 1% interest in the licensee.  The Indiana
Gaming Commission has adopted a rule requiring quarterly reporting by the
holder of a riverboat owner's license, including the Company, or a holder
of a supplier's license, of the officer's of the licensee, officer's of
persons that hold at least a 1% interest in the licensee, and of persons
who directly or indirectly own a 1% interest in the licensee.

The Indiana Gaming Commission has proposed a rule, which would if adopted,
prohibit the distribution by a riverboat licensee, including the Company,
to its partners, shareholders, itself, or any affiliated entity, if the
distribution would impair the financial viability of the riverboat gambling
operation.  The Indiana Gaming Commission has proposed another rule, which
would if adopted, require riverboat licensees, including the Company, to
maintain on a quarterly basis a cash reserve in the amount of the actual
payout for three days, and the cash reserve would include cash in the
casino cage, cash in a bank account in Indiana, or cash equivalents not
committed or obligated.

In addition to receiving a license to conduct riverboat casino operations
from the Indiana Gaming Commission, the Company has secured permits and
approvals from the United States Army Corps of Engineers to develop the
facilities it is using to conduct operations.  The Company has received  

                                     22
<PAGE>
three alcoholic beverage permits: one for riverboat excursions and two for
land support facilities.  All building permits and other approvals for the
permanent facilities have been received, and the project is substantially
completed.

The Indiana Act prescribes a tax on adjusted gross receipts from gambling
games authorized under the Indiana Act at the rate of 20% on adjusted gross
receipts.  For this purpose, adjusted gross receipts means the total of all
cash and property received from gaming operations less cash paid out as
winnings and uncollectible gaming receivables (not to exceed 2%).  The
Indiana Act also prescribes an additional tax for admissions, based upon $3
for each person admitted to a gaming excursion.  The admissions tax is paid
for each excursion or part of an excursion for which the person remains on
board.  Recent legislation permits the imposition of property taxes on
riverboats as real property at rates to be determined by local taxing
authorities.  Indiana corporations are also subject to the Indiana gross
income tax, the Indiana adjusted gross income tax and the Indiana
supplemental corporate net income tax.  Sales on a riverboat are subject to
applicable use, excise and retail taxes.  The Indiana Act requires a
riverboat owner licensee to directly reimburse the Indiana Gaming
Commission for the costs of inspectors and agents required to be present
during the conduct of gaming operations.  

The Indiana Act places special emphasis upon minority and women's business
enterprise participation in the riverboat industry.  Any person issued a
riverboat owner's license must establish goals of at least 10% of the total
dollar value of the licensee's contracts for goods and services with
minority business enterprises and 5% of the total dollar value of the
licensee's contracts for goods and services with women's business
enterprises.  The Indiana Gaming Commission may suspend, limit or revoke
the owner's license or impose a fine for failure to comply with the
statutory requirements.

Minimum and maximum wagers on games on the riverboat are left to the
discretion of the licensee.  Wagering may not be conducted with money or
other negotiable currency.

An institutional investor which acquires 5% or more of any class of voting
securities of a holding company of a licensee is required to notify the
Indiana Gaming Commission and to provide additional information, and may be
subject to a finding of suitability.  A person who acquires 5% or more of
any class of voting securities of a holding company of a licensee is
required to apply to the Indiana Gaming Commission for a finding of
suitability.  A riverboat licensee or an affiliate may not enter into a
debt transaction of $1 million or more without approval of the Indiana
Gaming Commission.  The Company received approval from the Indiana Gaming
Commission in January 1997 for a second secured revolving credit facility
of up to $25 million, and in December 1997, the Company received the first
of two required approvals from the Indiana Gaming Commission for a reducing
revolving credit facility and term loan for up to $350 million.  A
riverboat owner's license is a revocable privilege and is not a property
right under the Indiana Act.  A riverboat owner licensee or any other
person may not lease, hypothecate, borrow money against or loan money
against a riverboat owner's license.

Pursuant to agreements with the City of Evansville, as reflected in the
owner's license issued to the Company, the Company agreed to certain fixed 

                                     23
<PAGE>
commitments to the City of Evansville.  In lieu of the Company contributing
the remaining $2 million for the Dress Plaza, the Company donated two
parcels of real estate on Main Street to the City of Evansville in January
1997, and the Indiana Gaming Commission had no objection to this
transaction.

The Governor of Indiana has appointed a Gaming Impact Study Commission,
chaired by the Attorney General, to review the impact of all forms of
gaming in Indiana, and to issue a final report by December 31, 1999.

A lawsuit was filed on October 25, 1996, by three individuals in Harrison
County, Indiana, which challenges the constitutionality of the Indiana Act. 
The lawsuit alleges that the Indiana Act (i) creates an unequal privilege
because supporters of riverboat gambling, having lost a county-wide
referendum, are permitted to resubmit a proposal to county voters for
approval of riverboat gambling, while opponents, having lost a county-wide
referendum, are not allowed to resubmit a proposal; and (ii) was enacted as
part of a state budget bill allegedly in violation of a state
constitutional requirement that legislation be confined to a single subject
and matters connected to this subject.  The State of Indiana has filed an
answer to the complaint.  The Supreme Court of Indiana has previously
upheld the constitutionality of the Indiana Act, although the prior
challenge involved different grounds than those alleged in this recent
lawsuit.

  Environmental Matters

The Company is subject to federal, state and local laws, regulations and
ordinances that (i) govern activities or operations that may have adverse
environmental  effects, such as discharges to air and water as well as
handling and disposal practices for solid and hazardous wastes, and (ii)
impose liability for the costs of cleaning up, and certain damages
resulting from, past spills, disposals or other releases of hazardous
substances (together, "Environmental Laws").  The Company uses certain
substances and generates certain wastes that are regulated or may be deemed
hazardous under applicable Environmental Laws.  From time to time, the
Company's operations have resulted, or may result, in certain non-
compliance with applicable requirements under Environmental Laws.  The
Company also has incurred, and in the future may incur, costs related to
cleaning up contamination relating to historical uses of certain of its
current or former properties (in particular, the riverboat properties,
which have in the past been used for various industrial purposes).  Any
such noncompliance with applicable requirements or liability under
Environmental Laws has not had, and is not expected to have, a material
adverse effect on the Company's results of operations or its financial
condition.

  Other Regulations

The Company's businesses are subject to various federal, state and local
laws and regulations in addition to those discussed above.  These laws and
regulations include but are not limited to restrictions and conditions
concerning employees, taxation, zoning and building codes, and marketing
and advertising.  Such laws and regulations could change or could be
interpreted differently in the future, or new laws and regulations could be
enacted.  Material changes, new laws or regulations, or material
differences in interpretations by courts or governmental authorities could
adversely affect the Company.
                                     24
<PAGE>
EMPLOYEES

The Company employs approximately 10,800 people, of which approximately
3,400 employees are represented by unions.  Of the approximately 5,000
employees at Tropicana Atlantic City, approximately 1,800 are covered by
collective bargaining contracts.  Substantially all of such employees are
covered by a contract that expires in 1999 and a small number are covered
by contracts that expire in 2001.  At Tropicana Las Vegas, approximately
1,600 of the 2,700 employees are covered by collective bargaining
contracts.  Substantially all of such employees are covered by contracts
that expired on June 1, 1997, and those employees are currently working
without a contract while negotiations continue.  The remainder of such
employees are covered by contracts that expire in 1998, 1999 or 2000.  At
Ramada Express there are approximately 1,400 employees, none of which are
covered by collective bargaining agreements.  The Company has approximately
1,200 employees and 400 employees, respectively, at Casino Aztar Evansville
and Casino Aztar Caruthersville, none of which are covered by collective
bargaining agreements.

TRADEMARKS

The Company uses a variety of trade names, service marks and trademarks and
believes it has all the licenses necessary to conduct its business.  The
Company has registered several service marks and trademarks with the United
States Patent and Trademark Office or otherwise acquired the licenses to
use those which are material to the conduct of the Company's business as a
whole.

The Company, HRN and Adamar are the beneficiaries of an agreement with
Tropicana Enterprises, the owner of certain properties related to Tropicana
Las Vegas, and the Jaffe family regarding the use of the name "Tropicana"
for the operation of a casino hotel in New York State (if gaming were to be
authorized in New York State).  Pursuant to such agreement, the Company has
registered the name under the Lanham Act.  Upon the occurrence of certain
events, the right to use the name reverts to Tropicana Enterprises.

Ramada has licensed the Company to use the name "Ramada" in conjunction
with the operation of Ramada Express, and will not use or permit the use of
the name "Ramada" in Laughlin, Nevada by any other person or entity.

The Company has registered the following important trademarks or service
marks: Aztar, Casino Aztar, Trop, Trop Park, and The Island of Las Vegas. 
The Company  believes there are no other trademarks or service marks the
use of which is material to the conduct of the Company's business as a
whole.

ITEM 2.  PROPERTIES
-------------------
     TROPICANA ATLANTIC CITY.

Tropicana Atlantic City is located on an approximate 10-acre site in
Atlantic City, New Jersey.  In July 1993, Tropicana Atlantic City became
wholly owned by the Company. 

     TROPICANA LAS VEGAS.

Tropicana Las Vegas is located on a 34-acre site in Las Vegas, Nevada. 
Tropicana Las Vegas is owned by Tropicana Enterprises and is leased to HRN,
                                     25
<PAGE>
which operates the casino and hotel under the lease ( the "Tropicana
Lease"), which expires in 2011.  The Company, through its wholly-owned
subsidiary, Adamar of Nevada, owns a noncontrolling 50% general partnership
interest in Tropicana Enterprises.  The remaining 50% general partnership
interest in Tropicana Enterprises is held by various individuals and trusts
associated with the Jaffe family subject to certain preferences on
liquidation.  On February 2, 1998, the Company acquired an option to
purchase the 50% partnership interest that it does not own.  The option
agreement extends for a period of up to 18 months and gives the Company an
unconditional right, but not the obligation, to purchase the partnership
interest for $120 million.  The Company has engaged an investment bank to
explore alternatives for a major redevelopment of the property.  The amount
and timing of any future expenditure, and the extent of any impact on
existing operations, will depend on the nature of the redevelopment
ultimately undertaken by the Company.

     RAMADA EXPRESS.  

Ramada Express is located on an approximate 28-acre site in Laughlin,
Nevada.  Ramada Express is wholly owned by the Company.  

     CASINO AZTAR EVANSVILLE

Casino Aztar operates on and from a base 8-acre site next to the Ohio River
in downtown Evansville, Indiana.  Approximately 4 1/2 acres are leased. 
The lease is for 10 years with 3 options to renew for 5 years each.  The
remaining approximately 3 1/2 acres are wholly owned by the Company.

     CASINO AZTAR CARUTHERSVILLE

Casino Aztar operates on and from a 37-acre site next to the Mississippi
River in downtown Caruthersville, Missouri.  The site and facilities are
wholly owned by the Company.  The Company has some unused land at this site
and is searching for development opportunities with other entities to use
the land for facilities that would complement the Company's operations.

     GENERAL.

The Company leases its corporate headquarters located in Phoenix, Arizona
and owns or leases certain other facilities which are not material to the
Company's operations.

Substantially all land, casino hotel buildings, casino riverboats,
pavilions, furnishings and equipment owned by the Company are pledged as
collateral under long-term debt agreements.

ITEM 3.  LEGAL PROCEEDINGS
--------------------------
The Company and more than 40 other major casino operators, as well as
various manufacturers and distributors of video poker and electronic slot
machines, have been named as defendants in an action originally filed in
the United States District Court for the Middle District of Florida,
Orlando Division, entitled William H. Poulos, On Behalf of Himself and All
Others Similarly Situated v. Caesars World, Inc., et al., Case No. 94-478-
CIV-ORL-22, filed on April 26, 1994.  This action was consolidated with
another subsequently filed action in that court entitled William Ahearn, On
Behalf of Himself and All Others Similarly Situated v. Caesars World, Inc.,

                                     26
<PAGE>
et al., Case No. 94-532-CIV-ORL-22 (the "Actions" or collectively, the
"Poulos/Ahearn Case").  Both Actions were brought under RICO and state
common law and seek compensatory and punitive damages in excess of $1
billion from the defendants.  The complaints allege that the defendants
took part in a scheme intended to induce people to play video poker and
electronic slot machines based on false beliefs concerning how those
machines actually operate as well as the extent to which there is actually
an opportunity to win on any given play.  The precise nature of the
Company's alleged role in the alleged fraud and conspiracy to defraud is
not discernible from the complaints.

On December 9, 1994, the Florida Court ordered that the Actions be
transferred to the United States District Court for the District of Nevada. 
That transfer occurred and the Nevada Court assumed control of the cases, 
and assigned case numbers CV-S-94-1126-LDG(RJJ) and CV-S-94-1137-LDG(RJJ). 
Numerous defendants (including the Company) moved to dismiss the complaints
for failure to state a claim.  In an order entered April 17, 1996, United
States District Court Judge Lloyd D. George granted the defendants' motions
and dismissed the complaints without prejudice.  The plaintiffs filed an
amended complaint on May 31, 1996, and the defendants again moved to
dismiss it for failure to state a claim (and on other grounds).  The claims
in the amended complaint sought damages that are the same as those in the
original complaints.  The Plaintiffs opposed these motions.  By order dated
August 17, 1996, the Poulos/Ahearn Case was transferred to United States
District Court Judge David Ezra and assigned the new Case No. CV-S-94-1126-
DAE(RJJ)-BASE FILE.

On May 31, 1996, the plaintiffs filed a motion to substitute Brenda
McElmore for Mr. Ahearn as one of the class representatives.  This motion
was not opposed by the Company, though several of the other defendants did
oppose the motion.

By order entered December 30, 1994, the Court stayed all discovery pending
a decision on the dispositive motions.  The plaintiffs filed a motion on
July 12, 1996, seeking to lift the stay of discovery and seeking leave to
add additional defendants.  The Company and the other defendants opposed
these motions.

On September 26, 1995, an action entitled Larry Schreier, On Behalf of
Himself and All Others Similarly Situated v. Caesars World, Inc., et al.,
Case No. CV-S-95-00923-DWH(RJJ)(the "Schreier Case") was commenced in the
United States District Court for the District of Nevada.  The case was
thereafter transferred to District Judge Lloyd D. George and assigned the
Case No. CV-S-95-00923-LDG(RJJ).  The Schreier Case is identical to the
Poulos/Ahearn Case in all material respects, except that the named
plaintiff in the Schreier Case purports to represent a smaller and more
precisely defined class of persons than the plaintiffs in the Poulos/Ahearn
Case.  The defendants (including the Company) moved to dismiss the Schreier
complaint on the same grounds as in the previously described Poulos/Ahearn
Case, as well as on the ground that this case was filed for an improper
purpose, an attempt to circumvent prior rulings of the Court in the
Poulos/Ahearn Case.  On August 15, 1996, District Judge Lloyd D. George
granted the motion to dismiss, without prejudice.  An amended complaint
containing the same principal allegations was filed on September 30, 1996. 
The defendants (including the Company) filed motions to dismiss the amended
complaint for failure to state a claim and on other grounds.  The Plaintiff
opposed these motions.

                                     27
<PAGE>
On December 13, 1996, a status conference was held in the Poulos/Ahearn
Case before Judge Ezra, who entered the following orders:

         A.  The Poulos/Ahearn Case and Schreier Case were consolidated, as
was the action entitled William H. Poulos, On Behalf of Himself and All
Others Similarly Situated vs. Ambassador Cruise Lines, Inc., et al., Case
No. CV-S-95-936 LDG(RLH)(the "Cruise Ship Case")(collectively, the
"Consolidated Cases").  (The allegations in the Cruise Ship Case are nearly
identical to those made in the Poulos/Ahearn Case and Schreier Case, and
are made against a group of defendants consisting of several manufacturers
and distributors of gaming devices, as well as numerous cruise ship
operators and companies which operate cruise ship casinos.)

         B.  All pending motions in the Consolidated Cases were deemed
withdrawn without prejudice.

On February 14, 1997, the Plaintiffs filed a consolidated amended complaint
in the Consolidated Cases.  On March 21, 1997, the Defendants moved to
dismiss the consolidated amended complaint for failure to state a claim and
on other grounds.  The Plaintiffs opposed these motions.  The defendants
filed reply memoranda in support of the motions.  The motions were argued
on November 3, 1997.

On December 19, 1997, the court entered orders deciding the motions in the
Consolidated Cases.  The substance of those orders is as follows:

     1.  The motion to dismiss was granted as to the "wire fraud"
allegation in the RICO claim; the balance of the motion to dismiss the RICO
claims was denied.

     2.  The motion to strike certain parts of the consolidated amended
complaint was granted in part.

     3.  The remaining motions (to dismiss and to stay or abstain) were
denied.

     4.  The plaintiffs were permitted to delete Mr. Ahearn, and add Ms.
McElmore as a class representative.

The plaintiffs in the Consolidated Cases filed a second consolidated
amended complaint on January 9, 1998.  The second consolidated amended
complaint contains claims which are nearly identical to those in the
previously dismissed complaints.  The defendants answered on February 11,
1998.  The parties have submitted an updated case management order, and the
defendants have filed a motion seeking to bifurcate discovery into "class"
and "merits" phases, and to stay "merits" discovery pending a decision on
plaintiffs' motion for class certification (not yet filed).

The Company believes that plaintiffs' allegations are without merit, and it
intends to defend the actions vigorously.

The Company is a party to various claims, legal actions and complaints
arising in the ordinary course of business or asserted by way of defense or
counterclaim in actions filed by the Company.  Management believes that its
defenses are substantial in each of these matters and that the legal
posture of the Company can be successfully defended or satisfactorily
settled without material adverse effect on its consolidated financial
statements.
                                     28
<PAGE>
ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
------------------------------------------------------------
None

EXECUTIVE OFFICERS OF THE REGISTRANT
------------------------------------
     The registrant has elected not to include information concerning its
executive officers in its 1997 Proxy Statement, as allowed by the Proxy
Statement instructions.  The registrant relies on General Instruction G(3)
of this report on Form 10-K in presenting the following information on its
executive officers.
                                                             Tenure      
                                                        -----------------
                                                           With   Present
       Name                     Office             Age   Company  Position
-------------------  ----------------------------  ---  --------  --------
Paul E. Rubeli       Chairman of the Board,        54   19 years  6 years
                     President and Chief
                     Executive Officer 
                     
Robert M. Haddock    Executive Vice President      53   17 years  11 years
                     and Chief Financial
                     Officer

Nelson W. Armstrong, 
 Jr.                 Vice President,               56   25 years  8 years
                     Administration, and Secretary

Joe C. Cole          Vice President,               59   10 years 10 years
                     Corporate Communications

Meridith P. Sipek    Controller                    51   20 years  8 years

Neil A. Ciarfalia    Treasurer                     50    3 years  3 years

Paul E. Rubeli.  Mr. Rubeli joined Ramada in 1979 as Group Vice President,
Industrial Operations.  He served as Executive Vice President, Gaming, of
Ramada from 1982 to December 1989, when he was appointed President and
Chief Operating Officer, of the Company in the Restructuring.  He was
appointed President and Chief Executive Officer in February 1990 and was
appointed Chairman of the Board in addition to his other positions in
February 1992.

Robert M. Haddock.  Mr. Haddock joined Ramada in 1980 and held various
positions before becoming Executive Vice President and Chief Financial
Officer in March 1987, serving in that capacity until the Restructuring,
when he assumed the same position with the Company.

Nelson W. Armstrong, Jr.  Mr. Armstrong joined Ramada in 1973 as an
accounting supervisor and held various positions on the corporate
accounting staff, serving as Vice President and Controller, of Ramada and
then of the Company after the Restructuring until he was appointed Vice
President, Administration, and Secretary, of the Company in March 1990.





                                     29
<PAGE>
EXECUTIVE OFFICERS OF THE REGISTRANT (continued)
------------------------------------------------
Joe C. Cole.  Mr. Cole joined Ramada in March 1988 as Vice President,
Corporate Communications, after having been affiliated with Phoenix Newspapers
Inc. for 26 years as a reporter, columnist and editor.  He became Vice
President, Corporate Communications, of the Company in the Restructuring.

Meridith P. Sipek.  Mr. Sipek joined Ramada's corporate accounting staff in
1977 as a manager and held various positions in corporate and hotel
accounting, serving as Hotel Group Controller, before being named Assistant
Corporate Controller, of Ramada and then of the Company after the
Restructuring.  He was appointed Controller, of the Company in March 1990.

Neil A. Ciarfalia.  Mr. Ciarfalia joined the Company in 1995 as Treasurer. 
Prior to joining the Company, Mr. Ciarfalia spent 11 years with the commercial
aircraft division of Saab-Scania AB.  During that time, he served Saab as
President of the various divisional finance companies which arranged or
provided financing for the acquisition of Saab aircraft and related products.

                                    PART II
                                    -------

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
------------------------------------------------------------------------------
Aztar had 10,032 shareholders of record as of March 2, 1998. 

The additional information required by this Item 5 is included in this report
on F-18, F-31, F-40 and F-50.

ITEM 6. SELECTED FINANCIAL DATA
-------------------------------
The information required by Item 6 is included in this report on page F-50.

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
------------------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------
The information required by Item 7 is included in this report on pages F-40
through F-49.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
--------------------------------------------------------------------
Not required of the Company at this time.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
----------------------------------------------------
Reference is made to the Index to Financial Statements and Schedules on page
F-1.

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND  
------------------------------------------------------------------------
FINANCIAL DISCLOSURE
--------------------
     None.




                                      30
<PAGE>
                                   PART III
                                   --------
ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
------------------------------------------------------------
The information required by Item 10 is incorporated by reference to the
registrant's definitive Proxy Statement to be filed with the Securities and
Exchange Commission.  A cross-referenced index is located on the facing page
of this report.

Information concerning the registrant's executive officers is presented above
under a separate caption in Part I of this report.

ITEM 11.  EXECUTIVE COMPENSATION
--------------------------------
The information required by Item 11 is incorporated by reference to the
registrant's definitive Proxy Statement to be filed with the Securities and
Exchange Commission.  A cross-referenced index is located on the facing page
of this report.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
------------------------------------------------------------------------
The information required by Item 12 is incorporated by reference to the
registrant's definitive Proxy Statement to be filed with the Securities and
Exchange Commission.  A cross-referenced index is located on the facing page
of this report.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
--------------------------------------------------------
None

                                    PART IV
                                    -------

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
--------------------------------------------------------------------------

(a)  1.  Financial Statements:

         See the Index to Financial Statements and Schedules on page F-1.

     2.   Financial Statement Schedules:

         See the Index to Financial Statements and Schedules on page F-1.

     3.  Exhibits:

         See the exhibit index on page E-1 for a listing of exhibits filed
         with this report and those incorporated by reference.

         All other exhibits have been omitted because the information is
         not required or is not applicable.







                                      31
<PAGE>
(b)  Reports on Form 8-K:

            On February 3, 1998, the Company filed a report on Form 8-K
            (as amended and replaced in its entirety by Form 8-K/A
            filed the same day) under Item 5. Other Events to file, as
            Exhibit 99.1, a news release issued by the Registrant which
            referenced, as Exhibit 99.2, an option agreement dated
            February 2, 1998, entered into between the Company and the
            parties constituting the Jaffe Group.

For the purposes of complying with the amendments to the rules governing Form
S-8 (effective July 13, 1990) under the Securities Act of 1933, the
undersigned registrant hereby undertakes as follows, which undertaking shall
be incorporated by reference into registrant's Registration Statements on Form
S-8 No. 33-32399 and No. 33-44794 (filed January 5, 1990 and December 24,
1991, respectively):

Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities
Act of 1933 and is, therefore, unenforceable.  In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.


























                                      32
<PAGE>
                                  SIGNATURES
     Pursuant to the requirements of Section 13 or 15(d) 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.

     AZTAR CORPORATION  By ROBERT M. HADDOCK           March 19, 1998 
     -----------------     -------------------------   ------------------
     Registrant            Robert M. Haddock                   Date
                           Executive Vice President and
                           Chief Financial Officer

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

PAUL E. RUBELI               Chairman of the Board, President March 19, 1998  
-------------------------    and Chief Executive Officer, and ----------------
Paul E. Rubeli               Director

ROBERT M. HADDOCK            Executive Vice President and     March 19, 1998
-------------------------    Chief Financial Officer, and     ----------------
Robert M. Haddock            Director

MERIDITH P. SIPEK            Controller                       March 19, 1998
-------------------------                                     ----------------
Meridith P. Sipek

JOHN B. BOHLE                Director                         March 19, 1998
-------------------------                                     ----------------
John B. Bohle

E. M. CARSON                 Director                         March 19, 1998
-------------------------                                     ----------------
Edward M. Carson

LINDA C. FAISS               Director                         March 19, 1998
-------------------------                                     ----------------
Linda C. Faiss

JOHN R. NORTON, III          Director                         March 19, 1998
-------------------------                                     ----------------
John R. Norton, III

ROBERT S. ROSOW              Director                         March 19, 1998
-------------------------                                     ----------------
Robert S. Rosow

R. SNELL                     Director                         March 19, 1998
-------------------------                                     ----------------
Richard Snell

VESTA VALENTINE TEMEN        Director                         March 19, 1998
-------------------------                                     ----------------
Vesta Valentine Temen

TERENCE W. THOMAS            Director                         March 19, 1998
-------------------------                                     ----------------
Terence W. Thomas

                                      33
<PAGE>
                 INDEX TO FINANCIAL STATEMENTS AND SCHEDULES


I.  Financial Statements                                             Page
                                                                     ----

  1. Aztar Corporation and Subsidiaries


     Report of Independent Accountants . . . . . . . . . . . . . . .  F-2

     Consolidated Balance Sheets at January 1, 1998 and 
       January 2, 1997 . . . . . . . . . . . . . . . . . . . . . . .  F-3

     Consolidated Statements of Operations for the years ended
       January 1, 1998, January 2, 1997 and December 28, 1995. . . .  F-5

     Consolidated Statements of Cash Flows for the years ended 
       January 1, 1998, January 2, 1997 and December 28, 1995. . . .  F-7

     Consolidated Statements of Shareholders' Equity for the 
       years ended January 1, 1998, January 2, 1997 and 
       December 28, 1995 . . . . . . . . . . . . . . . . . . . . . .  F-9

     Notes to Consolidated Financial Statements. . . . . . . . . . . F-11



  2. Tropicana Enterprises


     Report of Independent Accountants . . . . . . . . . . . . . . . F-32

     Balance Sheets at January 1, 1998 and January 2, 1997 . . . . . F-33

     Statements of Operations for the years ended January 1, 1998, 
       January 2, 1997 and December 28, 1995 . . . . . . . . . . . . F-34

     Statements of Cash Flows for the years ended January 1, 1998,
       January 2, 1997 and December 28, 1995 . . . . . . . . . . . . F-35

     Statements of Partners' Capital for the years ended 
       January 1, 1998, January 2, 1997 and December 28, 1995. . . . F-36

     Notes to Financial Statements . . . . . . . . . . . . . . . . . F-37


II. Financial Statement Schedules - Aztar Corporation and Subsidiaries

     Report of Independent Accountants . . . . . . . . . . . . . . . .S-1

     Schedule II - Valuation and Qualifying Accounts . . . . . . . . .S-2

     All other schedules are omitted because the required information is
     either presented in the financial statements or notes thereto, or is
     not present in amounts sufficient to require submission of the
     schedule.

                                     F-1
<PAGE>






REPORT OF INDEPENDENT ACCOUNTANTS


To the Shareholders and Board of Directors
Aztar Corporation

We have audited the consolidated balance sheets of Aztar Corporation and
Subsidiaries as of January 1, 1998 and January 2, 1997, and the related
consolidated statements of operations, cash flows and shareholders' equity
for each of the three years in the period ended January 1, 1998.  These
financial statements are the responsibility of the Company's management. 
Our responsibility is to express an opinion on these financial statements
based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation.  We believe that our audits
provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial
position of Aztar Corporation and Subsidiaries as of January 1, 1998 and
January 2, 1997, and the consolidated results of their operations and their
cash flows for each of the three years in the period ended January 1, 1998
in conformity with generally accepted accounting principles.








COOPERS & LYBRAND L.L.P.






Phoenix, Arizona
February 4, 1998





                                     F-2
<PAGE>
<TABLE>
                     AZTAR CORPORATION AND SUBSIDIARIES
                         CONSOLIDATED BALANCE SHEETS
                    January 1, 1998 and January 2, 1997 
                  ----------------------------------------
                       (in thousands, except share data)

<CAPTION>
                                                      1997         1996    
                                                   ----------   ----------
<S>                                                <C>          <C>
Assets
Current assets:
 Cash and cash equivalents                         $   46,129   $   44,131 
 Accounts receivable, net                              44,133       41,723 
 Refundable income taxes                                   --        1,201 
 Inventories                                            6,779        7,508 
 Prepaid expenses                                      10,374        9,772 
 Deferred income taxes, net                            11,403        8,985 
                                                   ----------   ---------- 
     Total current assets                             118,818      113,320 
        
Investments in and advances to unconsolidated 
 partnership                                            9,375       10,360 
Other investments                                      22,319       26,697 
        
Property and equipment:
 Buildings, riverboats and equipment, net             802,230      827,103 
 Land                                                  98,762       95,747 
 Construction in progress                               1,215        3,820 
 Leased under capital leases, net                         672          389 
                                                   ----------   ---------- 
                                                      902,879      927,059 

Deferred income taxes, net                                331        2,565 
Other deferred charges and assets                      37,774       39,581 
                                                   ----------   ---------- 
                                                   $1,091,496   $1,119,582 
                                                   ==========   ========== 

</TABLE>














[FN]
The accompanying notes are an integral part of these financial statements.

                                     F-3
<PAGE>
<TABLE>
                     AZTAR CORPORATION AND SUBSIDIARIES
                   CONSOLIDATED BALANCE SHEETS (continued)
                    January 1, 1998 and January 2, 1997 
                  ----------------------------------------
                      (in thousands, except share data)
<CAPTION>

                                                     1997          1996    
                                                  ----------    ---------- 
<S>                                               <C>           <C>
Liabilities and Shareholders' Equity
Current liabilities:
 Accounts payable and accruals                    $   56,939    $   66,048 
 Accrued payroll and employee benefits                23,630        22,571 
 Accrued interest payable                             13,167        13,288 
 Income taxes payable                                    896         1,112 
 Current portion of long-term debt                    27,166        12,960 
 Current portion of other long-term liabilities        2,931         4,259 
                                                  ----------    ---------- 
     Total current liabilities                       124,729       120,238 
        
Long-term debt                                       491,932       527,006 
Other long-term liabilities                           24,204        27,042 
Contingencies and commitments
Series B ESOP convertible preferred stock 
 (redemption value $6,857 and $7,226)                  6,593         6,022 
        
Shareholders' equity:
 Common stock, $.01 par value (45,198,889           
   and 45,000,287 shares outstanding)                    491           489 
 Paid-in capital                                     412,029       411,158 
 Retained earnings                                    48,654        44,846 
 Less: Treasury stock                                (17,126)      (17,102)
       Unearned compensation                             (10)         (117)
                                                  ----------    ---------- 
     Total shareholders' equity                      444,038       439,274 
                                                  ----------    ---------- 
                                                  $1,091,496    $1,119,582 
                                                  ==========    ========== 
</TABLE>













[FN]
The accompanying notes are an integral part of these financial statements.

                                     F-4
<PAGE>
<TABLE>
                      AZTAR CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
  For the Years Ended January 1, 1998, January 2, 1997 and December 28, 1995
                      -----------------------------------
                     (in thousands, except per share data)
<CAPTION>
                                                 1997      1996      1995   
                                              ---------  --------- ---------
<S>                                           <C>        <C>       <C>
Revenues
  Casino                                      $645,604   $652,707  $469,211
  Rooms                                         53,126     47,977    40,543
  Food and beverage                             51,776     51,299    41,906
  Other                                         31,851     25,489    21,209
                                              --------   --------  --------
                                               782,357    777,472   572,869 

Costs and expenses
  Casino                                       298,104    314,732   226,239
  Rooms                                         30,258     27,931    24,967
  Food and beverage                             54,736     53,249    43,782
  Other                                         25,378     25,300    16,606
  Marketing                                     88,360     86,202    51,627
  General and administrative                    70,215     74,396    50,292
  Utilities                                     14,249     15,076    13,605
  Repairs and maintenance                       23,741     24,429    20,986
  Provision for doubtful accounts               12,944      5,892     3,611
  Property taxes and insurance                  24,093     23,285    19,927
  Rent                                          21,379     15,698    11,308
  Depreciation and amortization                 51,508     49,406    39,494
  Preopening costs                                  --      2,933     7,724
                                              --------   --------  --------
                                               714,965    718,529   530,168
                                              --------   --------  --------
Operating income                                67,392     58,943    42,701

  Interest income                                2,026      2,367     3,251
  Interest expense                             (62,543)   (58,577)  (51,052)
                                              --------   --------  --------
Income (loss) before other items and income 
  taxes                                          6,875      2,733    (5,100)

  Equity in unconsolidated partnership's loss   (4,618)    (4,793)   (5,081)
                                              --------   --------  --------
Income (loss) before income taxes                2,257     (2,060)  (10,181)

  Income taxes                                   2,185     22,699     5,187
                                              --------   --------  --------
Net income (loss)                             $  4,442   $ 20,639  $ (4,994)
                                              ========   ========  ========
</TABLE>





[FN]
The accompanying notes are an integral part of these financial statements.

                                      F-5
<PAGE>
<TABLE>
                      AZTAR CORPORATION AND SUBSIDIARIES
               CONSOLIDATED STATEMENTS OF OPERATIONS (continued)
  For the Years Ended January 1, 1998, January 2, 1997 and December 28, 1995
                      -----------------------------------
                     (in thousands, except per share data)
<CAPTION>
                                             1997      1996      1995
                                           --------  --------  --------
<S>                                        <C>       <C>       <C> 
Earnings per share:
  Net income (loss) per common share       $    .08  $    .48  $   (.15)

  Net income (loss) per common share
    assuming dilution                      $    .08  $    .46  $   (.15)

Weighted-average common shares 
  applicable to:
  Net income (loss) per common share         45,121    41,121    38,013
  Net income (loss) per common share 
    assuming dilution                        46,687    43,132    38,013

</TABLE>

































[FN]
The accompanying notes are an integral part of these financial statements.

                                      F-6
<PAGE>
<TABLE>
                      AZTAR CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
  For the Years Ended January 1, 1998, January 2, 1997 and December 28, 1995 
                                --------------
                                (in thousands)
<CAPTION>

                                              1997       1996       1995   
                                           ---------- ---------- ----------
<S>                                        <C>        <C>        <C>
Cash Flows from Operating Activities
Net income (loss)                          $   4,442  $  20,639  $  (4,994)
Adjustments to reconcile net income (loss) 
  to net cash provided by operating 
  activities:
   Depreciation and amortization              54,216     52,478     42,808 
   Provision for losses on accounts 
     receivable                               12,944      5,892      3,611 
   Loss on reinvestment obligation               569        729         -- 
   Rent expense                                 (984)      (732)      (636)
   Distribution in excess of equity in 
     income of partnership                       985      1,107      1,160 
   Deferred income taxes                        (184)   (22,451)    (5,616)
   Change in assets and liabilities:
    (Increase) decrease in accounts 
       receivable                            (15,128)   (23,701)    (7,545)
    (Increase) decrease in refundable 
       income taxes                            1,201         60       (538)
    (Increase) decrease in inventories 
       and prepaid expenses                   (1,141)    (1,787)      (516)
    Increase (decrease) in accounts payable,
       accrued expenses and income taxes 
       payable                                (8,324)     8,476     25,066 
    Other items, net                             893      7,429      6,375 
                                           ---------  ---------  --------- 
   Net cash provided by (used in) operating 
     activities                               49,489     48,139     59,175 
                                           ---------  ---------  --------- 
Cash Flows from Investing Activities
Payments received on notes receivable          1,310      1,150      1,009 
Reduction in other investments                 8,194      2,427     11,950 
Reduction in invested funds                       --         --      8,250 
Purchases of property and equipment          (25,117)  (120,426)  (135,863)
Additions to other long-term assets           (7,714)    (7,623)   (28,463)
                                           ---------  ---------  --------- 
   Net cash provided by (used in) investing 
     activities                            $ (23,327) $(124,472) $(143,117)
                                           ---------  ---------  --------- 

</TABLE>






[FN]
The accompanying notes are an integral part of these financial statements.

                                      F-7
<PAGE>
<TABLE>
                      AZTAR CORPORATION AND SUBSIDIARIES
               CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
  For the Years Ended January 1, 1998, January 2, 1997 and December 28, 1995 
                                --------------
                                (in thousands)
<CAPTION>
                                                1997      1996      1995   
                                              --------- --------- ---------
<S>                                           <C>       <C>       <C>
Cash Flows from Financing Activities
Proceeds from issuance of long-term debt      $237,700  $220,200  $ 83,600 
Proceeds from issuance of common stock             697    58,051     1,977 
Principal payments on long-term debt          (259,419) (177,421)  (17,837)
Principal payments on other long-term 
  liabilities                                   (1,777)   (5,126)       -- 
Debt issuance costs                               (195)     (478)      (80)
Preferred stock dividend                          (689)     (726)     (754)
Redemption of preferred stock                     (481)     (563)     (298)
                                              --------  --------  -------- 
   Net cash provided by (used in) 
     financing activities                      (24,164)   93,937    66,608 
                                              --------  --------  -------- 
Net increase (decrease) in cash and 
  cash equivalents                               1,998    17,604   (17,334)

Cash and cash equivalents at beginning 
  of year                                       44,131    26,527    43,861 
                                              --------  --------  -------- 
     Cash and cash equivalents at end 
       of year                                $ 46,129  $ 44,131  $ 26,527  
                                              ========  ========  ======== 
Supplemental Cash Flow Disclosures

Summary of non-cash investing and 
  financing activities:
    Reduction in land and other long-term
      liabilities                             $  2,000  $     --  $     -- 
    Capital lease obligations incurred
      for property and equipment                   552        --        41 
    Other long-term liabilities incurred 
      for deferred charges and other assets         --        --    13,400 
    Other long-term liabilities incurred 
      for property and equipment                    --        --       535 
    Tax benefit from stock options 
      and preferred stock dividend                 247       916       907 
    Issuance of restricted stock                    --       136     2,189 
    Forfeiture of restricted stock                  24        75       142 

Cash flow during the year for the following:
    Interest paid, net of amount capitalized  $ 60,041  $ 58,037  $ 47,758 
    Income taxes paid (refunded)                (3,233)    1,086       471 

</TABLE>




[FN]
The accompanying notes are an integral part of these financial statements.

                                      F-8
<PAGE>
<TABLE>
                      AZTAR CORPORATION AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
  For the Years Ended January 1, 1998, January 2, 1997 and December 28, 1995
                                --------------
                                (in thousands)
<CAPTION>
                                                          Unearned
                     Common  Paid-in  Retained  Treasury   Compen-
                      Stock  Capital  Earnings   Stock      sation    Total
                    -------- -------- --------- --------- --------- --------
<S>                 <C>      <C>      <C>       <C>       <C>       <C>
Balance,
 December 29, 1994  $    414 $347,284 $ 30,555  $(16,885) $     --  $361,368
 Stock options
  exercised                5    1,972                                  1,977
 Issuance of 
  restricted stock         3    2,186                       (2,189)       --
 Tax benefit
  from stock
  options exercised               779                                    779
 Preferred stock
  dividend and losses      
  on redemption, net 
  of income tax 
  benefit                                 (639)                         (639)
 Forfeiture of
  restricted stock                                  (142)      142        --
 Amortization of
  unearned
  compensation                                               1,168     1,168
 Net income (loss)                      (4,994)                       (4,994)
                    -------- -------- --------  --------  --------  --------
Balance,
 December 28, 1995       422  352,221   24,922   (17,027)     (879)  359,659
 Issuance of common
  stock in public
  offering                63   55,813                                 55,876
 Stock options
  exercised                4    2,171                                  2,175
 Issuance of 
  restricted stock                136                         (136)       --
 Tax benefit
  from stock
  options exercised               817                                    817
 Preferred stock
  dividend and losses
  on redemption, net 
  of income tax 
  benefit                                 (715)                         (715)
 Forfeiture of
  restricted stock                                   (75)       75        --
 Amortization of
  unearned
  compensation                                                 823       823
 Net income (loss)                      20,639                        20,639
                    -------  -------- --------  --------  --------  --------
Balance,
 January 2, 1997    $   489  $411,158 $ 44,846  $(17,102) $   (117) $439,274
                    =======  ======== ========  ========  ========  ========
</TABLE>
[FN]
The accompanying notes are an integral part of these financial statements.
                                      F-9
<PAGE>
<TABLE>
                      AZTAR CORPORATION AND SUBSIDIARIES
          CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (continued)
  For the Years Ended January 1, 1998, January 2, 1997 and December 28, 1995 
                                 -------------
                                (in thousands)
<CAPTION>
                                                          Unearned
                     Common  Paid-in  Retained  Treasury   Compen-
                      Stock  Capital  Earnings   Stock      sation    Total
                     ------- -------- --------- --------- --------- --------
<S>                  <C>     <C>      <C>       <C>       <C>       <C>
Balance, 
  January 2, 1997    $   489 $411,158 $ 44,846  $(17,102) $   (117) $439,274
  Stock options
   exercised               2      695                                    697
  Tax benefit
   from stock
   options exercised              176                                    176
  Preferred stock
   dividend and losses
   on redemption, net 
   of income tax 
   benefit                                (634)                         (634)
  Forfeiture of
   restricted stock                                  (24)       24        --
  Amortization of
   unearned
   compensation                                                 83        83
  Net income (loss)                      4,442                         4,442
                     ------- -------- --------  --------  --------  --------
Balance,
  January 1, 1998    $   491 $412,029 $ 48,654  $(17,126) $    (10) $444,038
                     ======= ======== ========  ========  ========  ========

</TABLE>




















[FN]
The accompanying notes are an integral part of these financial statements.

                                     F-10
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1.  SIGNIFICANT ACCOUNTING POLICIES

Basis of Consolidated Statements

Aztar Corporation ("Aztar" or the "Company") was incorporated in Delaware
in June 1989 to operate the gaming business of Ramada Inc. ("Ramada") after
the restructuring of Ramada (the "Restructuring").  The Restructuring
involved the disposition of Ramada's hotel and restaurant businesses with
Ramada's shareholders retaining their interest in the gaming business.  As
part of the Restructuring, the gaming business and certain other assets and
liabilities of Ramada were transferred to Aztar, and a wholly-owned
subsidiary of New World Hotels (U.S.A.), Inc. was merged with Ramada (the
"Merger").  In the Merger, each share of Ramada common stock was converted
into the right to receive $1.00 and one share of Aztar common stock.  

The Company operates casino hotels in Atlantic City, New Jersey and Las
Vegas, Nevada, under the Tropicana name and in Laughlin, Nevada, as Ramada
Express. The Company began operations of casino riverboats on April 28,
1995, in Caruthersville, Missouri, and on December 7, 1995, in Evansville,
Indiana under the Casino Aztar name.  A substantial portion of the
Company's consolidated revenues and assets are concentrated at the Atlantic
City Tropicana.

The consolidated financial statements include the accounts of Aztar and all
of its controlled subsidiaries and partnerships.  All subsidiary companies
are wholly owned.  In consolidating, all material intercompany transactions
are eliminated.  The Company uses a 52/53 week fiscal year ending on the
Thursday nearest December 31, which includes 52 weeks in 1997, 53 weeks in
1996 and 52 weeks in 1995. 

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements
and accompanying notes.  Actual results could differ from those estimates.

Cash and Cash Equivalents

Highly liquid investments purchased with an original maturity of three
months or less are classified as cash equivalents.  These instruments are
stated at cost, which approximates fair value because of their short
maturity.

Short-term Investments

Short-term investments purchased with an original maturity of over three
months but less than one year are stated at cost, which approximates fair
value because of their short maturity.  There were no short-term
investments at January 1, 1998 or January 2, 1997. 

Inventories

Inventories, which consist primarily of food, beverage and operating
supplies, are stated at the lower of cost or market value.  Costs are
determined using the first-in, first-out method.


                                    F-11
<PAGE>
Advertising Costs

Costs for advertising are expensed as incurred, except costs for direct-
response advertising, which are capitalized and amortized over the period
of the related program.  Direct-response advertising costs consist
primarily of mailing costs associated with direct-mail programs. 
Capitalized advertising costs, included in prepaid expenses, were
immaterial at January 1, 1998 and January 2, 1997.  Advertising costs that
were expensed during the year were $18,423,000 in 1997, $19,699,000 in 1996
and $12,951,000 in 1995. 

Other Investments

The Casino Reinvestment Development Authority ("CRDA") bonds are classified
as held-to-maturity securities and are carried at amortized cost.

Property and Equipment

Property and equipment are stated at cost.  During construction, the
Company capitalizes interest and other direct and indirect development
costs.  Interest is capitalized monthly by applying the effective interest
rate on certain borrowings to the average balance of expenditures.  There
was no interest capitalized during 1997.  The interest that was capitalized
during the years 1996 and 1995 was $4,503,000 and $5,290,000, respectively.

Depreciation and amortization are computed by the straight-line method
based upon the following useful lives:  buildings and improvements, 3-40
years; riverboats, barge, docking facilities and improvements, 3-25 years;
furniture and equipment, 3-15 years; and leasehold improvements, shorter of
lease term or asset useful life.  Accumulated depreciation and amortization
on buildings, riverboats and equipment was $262,654,000 at January 1, 1998
and $227,559,000 at January 2, 1997.
 
Improvements, renewals and extraordinary repairs that extend the life of
the asset are capitalized; other repairs and maintenance are expensed.  The
cost and accumulated depreciation applicable to assets retired are removed
from the accounts and the gain or loss, if any, on disposition is
recognized in income as realized.

Deferred Charges

Debt issuance costs are capitalized as incurred and amortized using the
interest method.  Capitalized debt issuance costs, net of accumulated
amortization of $7,301,000 and $4,977,000, were $11,447,000 and $13,576,000
at January 1, 1998 and January 2, 1997, respectively.

Costs incurred to obtain initial gaming licenses to operate a casino are
capitalized as incurred and amortized evenly over ten years beginning with
the commencement of operations; subsequent renewal costs are amortized
evenly over the renewal period.  Deferred licensing costs consist primarily
of payments or obligations to civic and community organizations, legal and
consulting fees, application and selection fees with associated
investigative costs and direct internal salaries and related costs of
development personnel.  Deferred licensing costs in connection with initial
gaming licenses of open and operating locations, net of accumulated
amortization of $6,351,000 and $3,978,000, were $17,874,000 and $18,969,000
at January 1, 1998 and January 2, 1997, respectively.

                                    F-12
<PAGE>
Preopening costs directly related to the opening of a gaming operation or
major addition to a gaming operation are capitalized as incurred and
expensed in the period the related facility commences operations. 
Preopening costs consist primarily of salaries and wages, marketing,
temporary office expenses, professional fees and training costs.  There
were no capitalized preopening costs at January 1, 1998 or January 2, 1997.

Development costs associated with pursuing opportunities in gaming
jurisdictions, as well as in jurisdictions in which gaming has not been
approved, are expensed as incurred until such time as a particular
opportunity is determined to be viable, generally when the Company has been
selected as the operator of a new gaming facility, has applied for a gaming
license or has obtained rights to a specific site.  Development costs
incurred subsequent to these criteria being met are capitalized. 
Development costs consist of deferred licensing costs and site acquisition
costs.  In jurisdictions in which gaming has not been approved, only site
acquisition costs are capitalized.  In the event a project is later
determined not to be viable or the Company is not licensed to operate a
facility at a site, the capitalized costs related to this project or site
would be expensed.  At January 1, 1998, the Company had capitalized
development costs of $954,000.  There were no capitalized development costs
at January 2, 1997.  It is reasonably possible that management's estimate
of viability with regard to a development project may change in the near
term.

Valuation of Long-Lived Assets

Long-lived assets and certain identifiable intangibles held and used by the
Company are reviewed for impairment whenever events or changes in
circumstances warrant such a review.  The carrying value of a long-lived or
intangible asset is considered impaired when the anticipated undiscounted
cash flow from such asset is separately identifiable and is less than its
carrying value.  In that event, a loss is recognized based on the amount by
which the carrying value exceeds the fair value of the asset.  Fair value
is determined primarily using the anticipated cash flows discounted at a
rate commensurate with the risk involved.  Losses on long-lived assets to
be disposed of are determined in a similar manner, except that fair values
are reduced for the cost to dispose.

The Company performed such a review at January 1, 1998, in connection with
its riverboat operation in Caruthersville, Missouri.  The Company had
approximately $45,702,000 in carrying value of long-lived assets and
certain identifiable intangibles associated with Casino Aztar
Caruthersville at January 1, 1998.  A number of factors were considered in
the evaluation of recoverability, including, but not limited to,
anticipated revenues and the duration thereof, expected operating costs,
the competitive environment and future legislative and regulatory changes. 
Although the results of the Company's analysis did not have an effect on
the carrying value for Casino Aztar Caruthersville at January 1, 1998, it
is reasonably possible that management's evaluation of recoverability could
change in the near term.

Equity Instruments

The fair value based method of accounting is used for equity instruments
issued to nonemployees for goods or services.  The intrinsic value based
method of accounting is used for stock-based employee compensation plans.

                                    F-13
<PAGE>
Revenue Recognition

Casino revenue consists of gaming win net of losses.  Revenues exclude the
retail value of complimentary food and beverage, accommodations and other
goods and services provided to customers.  The estimated costs of providing
such complimentaries have been classified as casino expenses through
interdepartmental allocations as follows (in thousands):

                           1997      1996      1995  
                         --------  --------  --------
    Rooms                $ 22,710  $ 23,615  $ 19,329
    Food and beverage      47,755    42,765    34,369
    Other                   2,957     2,716     3,894
                         --------  --------  --------
                         $ 73,422  $ 69,096  $ 57,592
                         ========  ========  ========
Income Taxes

Deferred tax assets and liabilities are recognized for the expected future
tax consequences of events that have been included in the financial
statements or income tax returns.  Deferred tax assets and liabilities are
determined based on the difference between the financial statement and tax
bases of assets and liabilities using enacted rates expected to apply to
taxable income in the years in which those differences are expected to be
recovered or settled.  The effect on deferred tax assets and liabilities of
a change in tax rates is recognized in income in the period that includes
the enactment date.

Earnings per Share

Net income (loss) per common share and net income (loss) per common share,
assuming dilution, are computed based on the provisions of Financial
Accounting Standards Board Statement of Financial Accounting Standards No.
128, Earnings per Share ("SFAS 128"), which superseded and simplified the
standards for computing earnings per share previously found in Accounting
Principles Board Opinion No. 15, Earnings per Share ("APB 15").  SFAS 128
replaced the presentation of net income (loss) per common and common
equivalent share under APB 15 with a presentation of net income (loss) per
common share.  Net income (loss) per common share excludes dilution and is
computed by dividing income (loss) applicable to common shareholders by the
weighted-average number of common shares outstanding.  Net income (loss)
per common share, assuming dilution, is computed similarly under SFAS 128
as it was under APB 15 and is based on the weighted-average number of
common shares outstanding after consideration of the dilutive effect of
stock options and the assumed conversion of the preferred stock at the
stated rate.  In accordance with the provisions of SFAS 128, the Company
has restated all prior period earnings per share data presented.

Reclassifications

Certain reclassifications have been made in the 1996 and 1995 Consolidated
Statements of Operations in order to be comparable with the 1997
presentation.

NOTE 2.  CONCENTRATIONS OF CREDIT RISK

Financial instruments which potentially subject the Company to 

                                    F-14
<PAGE>
concentrations of credit risk consist principally of cash and cash
equivalents, long-term investments and trade accounts receivable.  The
Company places its cash and temporary cash investments with high-credit-
quality financial institutions.  At times, such investments may be in
excess of the FDIC and SIPC insurance limits.  

The Atlantic City Tropicana has a concentration of credit risk in the
northeast region of the U.S.  Approximately 65% of the receivables at the
Nevada operations are concentrated in Asian and Latin American customers
and the remainder of their receivables are concentrated in California and
the southwest region of the U.S.  As a general policy, the Company does not
require collateral for these receivables.  At January 1, 1998 and January
2, 1997, the net receivables at Tropicana Atlantic City were $20,910,000
and $15,338,000, respectively, and the net receivables at Tropicana Las
Vegas and Ramada Express combined were $21,778,000 and $25,601,000,
respectively.

An allowance for doubtful accounts is maintained at a level considered
adequate to provide for possible future losses.  At January 1, 1998 and
January 2, 1997, the allowance for doubtful accounts was $17,919,000 and
$11,261,000, respectively.

NOTE 3.  INVESTMENTS IN AND ADVANCES TO UNCONSOLIDATED PARTNERSHIP

The Company's investment in unconsolidated partnership is a noncontrolling
partnership interest of 50% in Tropicana Enterprises, a Nevada general
partnership that owns the real property and certain personal property that
the Company leases in the operation of the Las Vegas Tropicana.  The
Company uses the equity method of accounting for this investment and in
connection with the lease expensed rents of $16,554,000 in 1997,
$16,652,000 in 1996 and $17,098,000 in 1995, of which 50% was eliminated in
consolidation.  On February 2, 1998, the Company acquired an option to
purchase the 50% partnership interest that it does not own.  The option
agreement extends for a period of up to 18 months and gives the Company an
unconditional right, but not the obligation, to purchase the partnership
interest for $120,000,000.
<TABLE>
Summarized balance sheet information and operating results for the
unconsolidated partnership are as follows (in thousands):
<CAPTION>
                                        1997        1996  
                                      --------    --------
     <S>                              <C>         <C> 
     Current assets                   $   944     $    959    
     Noncurrent assets                 65,768       69,540
     Current liabilities                  884          929
     Noncurrent liabilities            63,304       66,171
<CAPTION>
                                        1997        1996        1995  
                                      --------    --------    --------
     <S>                              <C>         <C>         <C>
     Revenues                         $16,591     $ 16,698    $ 17,166
     Operating expenses                (2,743)      (2,797)     (2,743)
                                      --------    --------    --------
     Operating income                  13,848       13,901      14,423
     Interest expense                  (5,397)      (5,693)     (6,323)
                                      --------    --------    --------
     Net income                       $ 8,451     $  8,208    $  8,100
                                      ========    ========    ========
</TABLE>
                                    F-15
<PAGE>
The Company's share of the above operating results, after intercompany
eliminations, is as follows (in thousands):

                                        1997        1996        1995  
                                      --------    --------    --------
     Equity in unconsolidated 
      partnership's loss              $ (4,618)   $ (4,793)   $ (5,081)

NOTE 4.  OTHER INVESTMENTS

At January 1, 1998 and January 2, 1997, other investments consisted of (in
thousands):
                                                 1997       1996  
                                               --------   --------
           CRDA deposits, net of a valuation 
             allowance of $6,706 and $6,425    $17,986    $16,796 
           CRDA bonds, net of an unamortized
             discount of $1,920 and $1,643       4,333      3,651 
           Certificate of deposit                   --      6,250 
                                               -------    ------- 
                                               $22,319    $26,697 
                                               =======    ======= 

The Company deposits funds with the CRDA to satisfy a New Jersey assessment
based upon its casino revenues.  Deposits with the CRDA bear interest at
two-thirds of market rates resulting in a fair value lower than cost.  If
not used for other purposes, the CRDA deposits are used to invest in bonds
issued by the CRDA as they become available that also bear interest at two-
thirds of market rates.  The CRDA bonds have various contractual maturities
that range from 17 to 47 years.  Actual maturities may differ from
contractual maturities because of prepayment rights.

The Company has executed an agreement with the CRDA for approximately
$24,000,000 in funding in connection with an expansion project at the
Atlantic City Tropicana.  The Company receives funds from the CRDA based on
expenditures made for the project to the extent that the Company has
available funds on deposit with the CRDA that qualify for this funding.  As
of January 1, 1998, the Company has received approximately $13,400,000 in
funding from the CRDA under this agreement.  At January 1, 1998 and January
2, 1997, the Company had approximately $900,000 and $2,500,000,
respectively, in available deposits with the CRDA that qualified and
accordingly reclassified these amounts to accounts receivable.  

At January 2, 1997, the Company had a certificate of deposit which was
pledged as collateral for two letters of credit aggregating $10,250,000.  

NOTE 5.  LAS VEGAS TROPICANA REDEVELOPMENT

The Company has engaged an investment bank to explore alternatives for a
major redevelopment of the Las Vegas Tropicana.  The amount and timing of
any future expenditure, and the extent of any impact on existing
operations, will depend on the nature of the redevelopment ultimately
undertaken by the Company.

The net book value of the property and equipment used in the operation of
the Las Vegas Tropicana was $37,743,000 at January 1, 1998.  It is
reasonably possible that the carrying value of some or all of these assets
may change in the near term.
                                    F-16
<PAGE>
NOTE 6.  LONG-TERM DEBT
<TABLE>
At January 1, 1998 and January 2, 1997, long-term debt included (in
thousands):
<CAPTION>
                                                           1997     1996  
                                                         -------- --------
<S>                                                      <C>      <C>
11% Senior Subordinated Notes Due 2002; redeemable
 at 103.143%                                             $200,000 $200,000
13 3/4% Senior Subordinated Notes Due 2004 ($180,000
 principal amount, 14% effective interest rate);
 redeemable beginning October 1, 1999 at 106.875%;
 net of unamortized discount                              178,061  177,904
Reducing revolving credit note; floating rate, 
7.94% at January 1, 1998; matures December 31, 1999       139,000  160,000
Other notes payable; 7% to 14.6%; maturities to 2002        1,213    1,521
Obligations under capital leases                              824      541
                                                         -------- --------
                                                          519,098  539,966
Less current portion                                      (27,166) (12,960)
                                                         -------- --------
                                                         $491,932 $527,006
                                                         ======== ========
</TABLE>
Maturities of long-term debt for the five years subsequent to January 1,
1998 are as follows (in thousands):

          Year
          1998                         $ 27,166
          1999                           26,856
          2000                           86,557
          2001                              233
          2002                          200,225

The 11% Senior Subordinated Notes (the "11% Notes") are due on October 1,
2002.  Interest on the 11% Notes is payable semiannually on April 1 and
October 1.  The 11% Notes are redeemable at the option of the Company, in
whole or in part, on or after October 1, 1997, at prices from 103.143% of
the principal amount plus interest declining to 100% plus interest
beginning October 1, 1999. 

The 13 3/4% Senior Subordinated Notes (the "13 3/4% Notes") are due on
October 1, 2004.  Interest on the 13 3/4% Notes is payable semiannually on
April 1 and October 1.  The 13 3/4% Notes are redeemable at the option of
the Company, in whole or in part, on or after October 1, 1999, at prices
from 106.875% of the principal amount plus interest declining to 100% plus
interest beginning October 1, 2003.  

The 11% Notes and 13 3/4% Notes, ranked pari passu, are general unsecured
obligations of the Company and are subordinated in right of payment to all
present and future Senior indebtedness (as defined) of the Company.  Upon
change of control of the Company, the holders of the 11% Notes and 13 3/4%
Notes would have the right to require repurchase of the respective notes at
par plus accrued interest.  Certain covenants in the 11% Notes and 13 3/4%
Notes limit the ability of the Company to incur indebtedness or engage in
mergers, consolidations or sales of assets.  



                                    F-17
<PAGE>
The reducing revolving credit note (the "Credit Facility") matures on
December 31, 1999.  The maximum amount available under the Credit Facility
was reduced to approximately $147,500,000 on December 31, 1997  and it will
be reduced quarterly in annual amounts of $35,000,000 in each year until
maturity.  The Credit Facility is collateralized by all the property of
Tropicana Atlantic City, Ramada Express and the riverboat casino operations
and, with certain exceptions, the stock of the Company's subsidiaries. 
Interest is computed on the outstanding principal balance based upon, at
the Company's option, a one-, two-, three- or six-month Eurodollar rate
plus a margin ranging from 1.25% to 2.75%, or the prime rate plus a margin
ranging from zero to 1.50%.  The applicable margin is dependent upon the
Company's outstanding indebtedness and operating cash flow.  Effective
February 16, 1998, the margin was at .25% less than the highest level. 
Interest computed based upon the Eurodollar rate is payable quarterly or on
the last day of the applicable Eurodollar interest period, if earlier. 
Interest computed based upon the prime rate is payable quarterly.  The
Company incurs a commitment fee ranging from 0.375% to 0.5% per annum on
the unused portion of the Credit Facility.

The reducing revolving loan agreement governing the Credit Facility (the
"Loan Agreement") imposes various restrictions on the Company, including
limitations on its ability to incur additional debt, commit funds to
capital expenditures and new venture investments, merge or sell assets.  
The Loan Agreement also prohibits dividends on the Company's common stock,
other than those payable in common stock, and repurchases of the Company's
common stock with certain limited exceptions.  In addition, the Loan
Agreement contains certain quarterly financial tests, including a minimum
net worth, a minimum debt service coverage ratio and ratios of maximum debt
and senior debt to operating cash flow.  At January 1, 1998, the maximum
debt to operating cash flow ratio as calculated under the Loan Agreement
was 4.12 to 1 and the allowable ratio was 4.90 to 1.  The maximum allowable
ratio decreases periodically to 4.60 to 1 at December 31, 1998 and 4.45 to
1 at July 1, 1999.  At January 1, 1998, the maximum senior debt to
operating cash flow ratio as calculated under the Loan Agreement was 1.47
to 1 and the allowable ratio was 1.75 to 1.  The maximum allowable ratio
decreases periodically to 1.40 to 1 at December 31, 1998 and 1.05 to 1 at
December 30, 1999.

On March 13, 1997, the Company entered into a supplemental reducing
revolving loan agreement maturing on March 15, 1999 (the "Supplemental
Credit Facility").  The Company has obtained bank commitments under the
Supplemental Credit Facility for $25,000,000.  The Supplemental Credit
Facility has terms and imposes restrictions on the Company similar to the
Credit Facility.  The availability of funds under the Supplemental Credit
Facility will reduce quarterly beginning on June 30, 1998 by $4,000,000. 
As of January 1, 1998, there were no borrowings under the Supplemental
Credit Facility.

NOTE 7.  LEASE OBLIGATIONS

The Company is a lessee under a number of noncancelable lease agreements
involving land, buildings, leasehold improvements and equipment, some of
which provide for contingent rentals based on revenues, the consumer price
index and/or interest rate fluctuations.  The leases extend for various
periods up to 13 years and generally provide for the payment of executory 



                                    F-18
<PAGE>
costs (taxes, insurance and maintenance) by the Company.  Certain of these
leases have provisions for renewal options ranging from 1 to 15 years,
primarily under similar terms, and/or options to purchase at various dates.
<TABLE>
Properties leased under capital leases are as follows (in thousands):
<CAPTION>
                                                      1997         1996  
                                                    --------     --------
          <S>                                       <C>          <C>
          Furniture and equipment                   $  9,945     $  9,393
          Less accumulated amortization               (9,273)      (9,004)
                                                    --------     --------
                                                    $    672     $    389
                                                    ========     ========
</TABLE>
Amortization of furniture and equipment leased under capital leases,
computed on a straight-line basis, was $269,000 in 1997, $146,000 in 1996
and $299,000 in 1995.
<TABLE>
Minimum future lease obligations on long-term, noncancelable leases in
effect at January 1, 1998 are as follows (in thousands):
<CAPTION>
         Year                                       Capital     Operating
         ----                                      --------     ---------
         <C>                                       <C>          <C>
         1998                                      $    365     $ 16,589
         1999                                           365       14,749
         2000                                           167       10,996
         2001                                            36        9,056
         2002                                            --        8,364
         Thereafter                                      --       60,864
                                                   --------     --------  
                                                        933     $120,618
                                                                ========
         Amount representing interest                  (109)
                                                   --------
         Net present value                              824
         Less current portion                          (299)
                                                   --------
         Long-term portion                         $    525
                                                   ========
</TABLE>
The above net present value is computed based on specific interest rates
determined at the inception of the leases.  
<TABLE>
Rent expense is detailed as follows (in thousands):
<CAPTION>
                                               1997      1996      1995  
                                             --------  --------  --------
         <S>                                 <C>       <C>       <C>
         Minimum rentals                     $ 18,099  $ 12,379  $  9,444
         Contingent rentals                     3,280     3,319     1,864
                                             --------  --------  --------
                                             $ 21,379  $ 15,698  $ 11,308
                                             ========  ========  ========
</TABLE>





                                    F-19
<PAGE>
NOTE 8.  OTHER LONG-TERM LIABILITIES
<TABLE>
At January 1, 1998 and January 2, 1997, other long-term liabilities
consisted of (in thousands):
<CAPTION>
                                               1997      1996  
                                             --------  --------
         <S>                                 <C>       <C>
         Accrued rent expense                $ 11,327  $ 12,311
         Obligation to City of Evansville
           and other civic and community
           organizations                        4,550     8,300
         Deferred compensation and
           retirement plans                    10,776    10,181
         Las Vegas Boulevard
           beautification assessment              482       509
                                             --------  --------
                                               27,135    31,301
         Less current portion                  (2,931)   (4,259)
                                             --------  --------
                                             $ 24,204  $ 27,042
                                             ========  ========
</TABLE>
NOTE 9.  REDEEMABLE PREFERRED STOCK

A series of preferred stock consisting of 100,000 shares has been
designated Series B ESOP Convertible Preferred Stock (the "ESOP Stock") and
those shares were issued on December 20, 1989, to the Company's Employee
Stock Ownership Plan (the "ESOP").  The ESOP purchased the shares for
$10,000,000 with funds borrowed from a subsidiary of the Company.  These 
funds are repayable in even semiannual payments of principal and interest
at 13 1/2% per year over a 10-year term.  During 1997, 1996 and 1995,
respectively, 4,555 shares, 4,644 shares and 2,797 shares were redeemed
primarily in connection with employee terminations and at January 1, 1998,
cumulative redemptions totaled 16,522 shares.  The ESOP Stock has an annual
dividend rate of $8.00 per share per annum payable semiannually in arrears. 
These shares have no voting rights except under certain limited, specified
conditions.  Shares not allocated to participant accounts and those shares
not vested may be redeemed at $100 per share.  Shares may be converted into
common stock at $9.46 per share of common stock and have a liquidation
preference of $100 per share. 

The shares that have been allocated to the ESOP participant accounts and
have vested are redeemable at the higher of appraised value, conversion
value or $100 per share, by the participant upon termination.  The excess
of the redemption value of the ESOP Stock over the carrying value is
charged to retained earnings upon redemption.  In the event of default in
the payment of dividends on the ESOP Stock for six consecutive semiannual
periods, each outstanding share would have one vote per share of common
stock into which the preferred stock is convertible.

NOTE 10.  CAPITAL STOCK

The Company is authorized to issue 10,000,000 shares of preferred stock,
par value $.01 per share, issuable in series as the Board of Directors may
designate.  Approximately 50,000 shares of preferred stock have been
designated Series A Junior Participating Preferred Stock but none have been
issued. 

                                    F-20
<PAGE>
The Company is authorized to issue 100,000,000 shares of common stock with
a par value of $.01 per share.  Shares issued were 49,120,863 at January 1,
1998, and 48,942,848 at January 2, 1997.  Common stock outstanding was net
of 3,921,974 and 3,942,561 treasury shares at January 1, 1998 and January
2, 1997, respectively.  One preferred stock purchase right (a "Right") is
attached to each share of the Company's common stock.  Each Right will
entitle the holder, subject to the occurrence of certain events, to
purchase a unit with no par value (a "Unit") consisting of one one-
thousandth of a share of Series A Junior Participating Preferred Stock at a
purchase price of $40.00 per Unit subject to adjustment.  The Rights will
expire in December 1999 if not earlier redeemed by the Company at $.01 per
Right.

In 1996, the Company issued 6,279,200 shares of common stock in a public
offering.  The Company issued 292,000 shares of restricted common stock in
1995 to certain executive officers and key employees; however, 3,668,
11,334 and 18,000 of these shares were forfeited in 1997, 1996 and 1995,
respectively.  The restrictions on 122,998 of the unforfeited shares will
lapse over a three-year period commencing on the date of issuance.  The
restrictions on 34,000 and 102,000 of the unforfeited shares lapsed during
1996 and 1995, respectively, after the common stock price hit certain
performance targets.  Compensation expense in connection with this issuance
of restricted common stock was $83,000, $823,000 and $1,168,000 in 1997,
1996 and 1995, respectively.

In accordance with the Merger agreement, 666,572 shares of common stock
that had not been claimed by the shareholders of Ramada were returned to
the Company in December 1990 to be held as treasury shares until claimed. 
During 1997, 1996 and 1995, respectively, 24,255, 25,606 and 29,758 shares
were claimed; the balance of unclaimed shares was 343,587 as of January 1,
1998.

During 1990, the Board of Directors authorized the Company to make
discretionary repurchases of up to 4,000,000 shares of its common stock
from time to time in the open market or otherwise and at January 1, 1998,
there remained 591,900 shares that could be repurchased under this
authority.  No shares were repurchased under this program in 1997, 1996 or 
1995.  Repurchased and forfeited shares are stated at cost and held as
treasury shares to be used for general corporate purposes.

At January 1, 1998, January 2, 1997 and December 28, 1995, common shares
reserved for future grants of stock options under the Company's stock
option plans were 589,000, 1,036,000 and 1,009,000, respectively.  At
January 1, 1998, common shares reserved for the conversion of the ESOP
Stock were 883,000 and shares of preferred stock reserved for exercise of
the Rights were 50,000.

NOTE 11.  STOCK OPTIONS

The Company has elected to follow Accounting Principles Board Opinion No.
25, Accounting for Stock Issued to Employees ("APB 25") and related
Interpretations in accounting for its stock-based employee compensation
arrangements because the alternative fair value based method of accounting
provided for under Financial Accounting Standards Board Statement of
Financial Accounting Standards No. 123, Accounting for Stock-Based
Compensation ("SFAS 123") requires use of option valuation models that were


                                    F-21
<PAGE>
not developed for use in valuing employee stock options.  Under APB 25,
because the exercise price of the Company's stock options equals the market
price of the underlying stock on the date of grant, no compensation expense
is recognized.

The Company's 1989 Stock Option and Incentive Plan ("1989 Plan") has
authorized the grant of up to 6,000,000 shares of the Company's common
stock pursuant to options, restricted shares and performance shares to
officers and key employees of the Company.  Options granted under the 1989
Plan have 10-year terms and vest and become exercisable at the rate of 1/3
per year on each of the first three anniversary dates of the grant subject
to continued employment on those dates.  The Company's 1990 Nonemployee
Director Stock Option Plan ("1990 Plan") has authorized the grant of up to
250,000 shares of the Company's common stock pursuant to options granted to
nonemployee Directors of the Company.  Options granted under the 1990 Plan
have 10-year terms and vest and become exercisable on the date of grant.

Pro forma information regarding net income and earnings per share is
required by SFAS 123, and has been determined as if the Company had
accounted for its stock option plans under the fair value based method of
that Statement.  The fair value for these options was estimated at the date
of grant using a Black-Scholes option pricing model with the following
weighted-average assumptions: risk-free interest rate of 6.5% in 1997 and
6.4% in 1996, no dividend in 1997 or 1996, volatility factor of the
expected market price of the Company's common stock of .29 in 1997 and .42
in 1996, and an expected life of the option of 5.2 years in 1997 and 5.3
years in 1996.

The Black-Scholes option valuation model was developed for use in
estimating the fair value of traded options which have no vesting or
trading restrictions and are fully transferable.  In addition, option
valuation models require the input of highly subjective assumptions
including the expected stock price volatility.  Because the Company's
employee stock options have characteristics significantly different from
those of traded options, and because changes in the subjective input
assumptions can materially affect the fair value estimate, in management's
opinion, the existing models do not necessarily provide a reliable single
measure of the fair value of its stock options.

For purposes of pro forma disclosures, the estimated fair value of the
options is amortized to expense over the options' vesting period.  The
Company's pro forma information for 1995 is not materially different than
as reported for 1995.  The pro forma information for 1997 and 1996 follows
(in thousands except for earnings per share information):

                                                  1997             1996   
                                                --------         --------
  Pro forma net income (loss)                   $  3,693         $ 20,122

  Pro forma earnings per share:
    Net income (loss) per common share          $    .07         $    .47
    Net income (loss) per common share 
      assuming dilution                         $    .07         $    .45





                                    F-22
<PAGE>
<TABLE>
A summary of the Company's stock option activity and related information
for the year ended December 28, 1995 follows (in thousands of shares):
<CAPTION>
                                           1995          
                                 ------------------------
                                 Shares Under Price Range
                                    Option    of Options   
                                 ------------ -----------
<S>                                 <C>       <C>
Beginning balance
 outstanding                        3,554     $3.19-$8.15
   Granted                            679     $7.00-$9.63
   Exercised                         (503)    $3.19-$8.15
   Cancelled, expired
     or surrendered                   (43)    $6.05-$8.15
                                   ------     
Ending balance 
 outstanding                        3,687     $3.19-$9.63
                                   ======     
Exercisable at end
 of year                            2,927
                                   ======
</TABLE>
<TABLE>
A summary of the Company's stock option activity and related information
for the years ended January 1, 1998 and January 2, 1997 follows (in
thousands of shares):
<CAPTION>
                           1997                          1996
               ----------------------------- -----------------------------
               Shares Under Weighted-Average Shares Under  Weighted-Average
                  Option     Exercise Price     Option      Exercise Price
               ------------ ---------------- ------------  ----------------
<S>                 <C>         <C>               <C>           <C>
Beginning balance 
 outstanding        3,230       $5.00             3,687         $4.96
  Granted             514       $7.00                88         $9.44
  Exercised          (178)      $3.92              (441)        $4.93
  Forfeited           (63)      $8.19               (58)        $7.37
  Expired              --       $  --               (46)        $8.15
                   ------                        ------
Ending balance 
 outstanding        3,503       $5.29             3,230         $5.00
                   ======                        ======
Exercisable at 
 end of year        2,774       $4.77             2,703         $4.47
                   ======                        ======
Weighted-average 
 fair value
 of options
 granted during 
 the year          $ 2.39                        $ 4.17

</TABLE>







                                    F-23
<PAGE>

<TABLE>
The following table summarizes additional information about the Company's
stock options outstanding at January 1, 1998 and January 2, 1997 (in
thousands of shares):
<CAPTION>
                       Options Outstanding        Options Exercisable
                 ------------------------------   -------------------
                          Weighted- 
                           Average    Weighted-             Weighted-
                 Shares   Remaining   Average     Shares    Average
  Range of       Under   Contractual  Exercise    Under     Exercise
Exercise Prices  Option     Life       Price      Option      Price  
---------------  ------  -----------  ---------   ------    ---------
<S>               <C>     <C>           <C>        <C>        <C>
1997
----
$3.19 to $5.00    1,922   2.6 years     $3.76      1,922      $3.76
$5.50 to $7.75    1,390   7.1 years     $6.83        739      $6.68
$8.50 to $11.00     191   7.9 years     $9.51        113      $9.46
                 ------                           ------
                  3,503   4.7 years     $5.29      2,774      $4.77
                 ======                           ======
1996
----
$3.19 to $5.00    2,082   3.6 years     $3.75      2,082      $3.75
$5.50 to $7.63      917   6.7 years     $6.73        554      $6.57
$8.50 to $11.00     231   8.8 years     $9.39         67      $9.36
                 ------                           ------
                  3,230   4.8 years     $5.00      2,703      $4.47
                 ======                           ======
</TABLE>
NOTE 12.  BENEFIT PLANS

The Company has a defined benefit pension plan for certain former executive
employees.  The Company has a nonqualified defined benefit retirement plan
for certain senior executives.
<TABLE>
The defined benefit plans provide for payment of retirement benefits that
are generally based on years of service and final average compensation. 
The defined benefit plans are unfunded.  The components of the defined
benefit plan expense are as follows (in thousands):
<CAPTION>
                                        1997        1996        1995
                                      --------    --------    --------
   <S>                                <C>         <C>         <C>  
   Service cost                       $     --    $     --    $    133
   Interest cost                           504         495         462
   Net amortization and deferral           185          90         227
                                      --------    --------    --------
                                      $    689    $    585    $    822
                                      ========    ========    ========

</TABLE>








                                    F-24
<PAGE>
<TABLE>
The following table shows (in thousands) the defined benefit plans' status
and amounts recognized in the Consolidated Balance Sheets at January 1,
1998 and January 2, 1997, respectively.
<CAPTION>
                                        1997        1996
                                      --------    --------
   <S>                                <C>         <C>
   Vested benefit obligation          $  4,845    $  4,721
                                      ========    ========
   Accumulated benefit obligation     $  4,845    $  4,721
                                      ========    ========
   Projected benefit obligation       $  6,096    $  6,050
   Plan assets at fair value                --          --
   Projected benefit obligation in 
     excess of plan assets               6,096       6,050
   Unrecognized prior service cost        (941)     (1,107)
   Unrecognized net gain                   254          67
   Adjustment to recognize minimum 
     liability                             130         126
                                      --------    --------
   Defined benefit plan liability     $  5,539    $  5,136
                                      ========    ========
   Actuarial assumptions:
     Discount rate                        8.5%         8.5%
     Rate of compensation increase        5.0%         5.0%
</TABLE>
The Company has a defined contribution savings plan that covers
substantially all employees who are not covered by a collective bargaining
unit.  The savings account feature of the plan allows employees, at their
discretion, to make contributions of their before-tax earnings to the plan
up to an annual maximum amount.  Effective July 1, 1997, the Company
matches 50% of the employee contributions that are based on up to 4% of an
employee's before-tax earnings.  Compensation expense in 1997 with regard
to Company matching contributions was $771,000.  Additional Company
contributions to the savings plan are discretionary and there were none in
1997, 1996 or 1995.  The Company contributed $2,711,000, $2,563,000 and
$2,305,000 in 1997, 1996 and 1995, respectively, to trusteed pension plans
under various collective bargaining agreements.

The Company has a deferred compensation plan for designated executives and
a similar plan for outside directors.  The plans provide for the payment of
benefits commencing at retirement.  The Company is substantially funding
the plans through the purchase of life insurance.
<TABLE>
The components of the deferred compensation plan expense are as follows (in
thousands):
<CAPTION>
                                        1997        1996        1995
                                      --------    --------    --------
   <S>                                <C>         <C>         <C>   
   Service cost                       $     17    $     19    $     20
   Interest cost                           370         357         340
   Net amortization and deferral           (16)        (19)        (16)
   Cash surrender value increase
     net of premium expense               (201)       (180)       (161)
                                      --------    --------    --------
                                      $    170    $    177    $    183
                                      ========    ========    ========
</TABLE>
                                    F-25
<PAGE>
<TABLE>
The following table shows (in thousands) the deferred compensation plans'
status and amounts recognized in the Consolidated Balance Sheets at January
1, 1998 and January 2, 1997, respectively.
<CAPTION>
                                                    1997        1996
                                                  --------    --------
   <S>                                            <C>         <C>
   Vested benefit obligation                      $  4,649    $  4,457
                                                  ========    ========
   Accumulated benefit obligation                 $  4,649    $  4,457
                                                  ========    ========
   Projected benefit obligation                   $  4,649    $  4,457
   Plan assets at fair value                            --          --
   Projected benefit obligation in 
     excess of plan assets                           4,649       4,457
   Unrecognized net gain                               588         588
                                                  --------    --------
   Deferred compensation plan 
     liability                                    $  5,237    $  5,045
                                                  ========    ========
   Actuarial assumption:
     Discount rate                                     8.5%        8.5%
</TABLE>
The Company's ESOP covers substantially all nonunion employees.  The
Company makes contributions to the ESOP so that, after the dividends are
paid on the Company's ESOP Stock, the ESOP can make its debt service
payments to the Company.  Cash dividends and contributions, respectively,
paid to the ESOP were $689,000 and $1,186,000 in 1997, $726,000 and
$1,149,000 in 1996 and $754,000 and $1,121,000 in 1995.  Compensation
expense recognized in 1997, 1996 and 1995, respectively, was $862,000,
$993,000 and $1,107,000.

NOTE 13.  INCOME TAXES 
<TABLE>
The (provision) benefit for income taxes is comprised of (in thousands):
<CAPTION>
                                              1997       1996      1995  
                                           --------   --------  --------
  <S>                                      <C>        <C>       <C> 
 Current:
  Federal                                  $  1,331   $   (860) $   (429)
   State                                         670      1,108        --
                                            --------   --------  --------
                                               2,001        248      (429)
 Deferred:                                  --------   --------  --------
   Federal                                     2,151     28,700     1,170
   State                                      (1,967)    (6,249)    4,446
                                            --------   --------  --------
                                                 184     22,451     5,616
                                            --------   --------  --------

                                            $  2,185   $ 22,699  $  5,187
                                            ========   ========  ========
</TABLE>
The Company is responsible, with certain exceptions, for the taxes of
Ramada through December 20, 1989.  The Internal Revenue Service ("IRS") has
completed its examination of the income tax returns for the years 1988 and
1989 and has settled with Ramada for all but one issue.  The effect of this
agreement on the Company was an income tax benefit of $2,323,000 in 1997
primarily related to cash received as a result of the settlement and
$21,028,000 in 1996 that included a reduction in the beginning-of-year 

                                    F-26
<PAGE>
valuation allowance.  The IRS has completed its examination of the income
tax returns for the years 1990 and 1991 and has settled with the Company
for all but one issue.  The IRS is examining the income tax returns for the
years 1992 and 1993.  Management believes that adequate provision for
income taxes and interest has been made in the financial statements.
<TABLE>
General business credits are taken as a reduction of the provision for
income taxes during the year such credits become available.  The
(provision) benefit for income taxes differs from the amount computed by
applying the U.S. federal income tax rate (35%) because of the effect of
the following items (in thousands):
<CAPTION>
                                              1997       1996      1995  
                                            --------   --------  --------
<S>                                         <C>        <C>       <C>
Tax (provision) benefit at U.S. federal 
  income tax rate                           $  (790)   $   721   $ 3,563
    State income taxes, net                    (788)        29     2,889
    Nondeductible business expenses            (727)      (640)   (1,817)
    IRS examination                           1,498      1,158        19
    General business credits                    286        237       421
    Change in valuation allowance                --      3,641        --
    Ramada tax sharing agreement              2,323     17,387        --
    Other, net                                  383        166       112 
                                            -------    -------   -------
                                            $ 2,185    $22,699   $ 5,187
                                            =======    =======   =======
</TABLE>
<TABLE>
The income tax effects of loss carryforwards, tax credit carryforwards and
temporary differences between financial and income tax reporting that give
rise to the deferred income tax assets and liabilities at January 1, 1998
and January 2, 1997, are as follows (in thousands):
<CAPTION>
                                                  1997             1996  
                                               ---------        ---------
<S>                                            <C>              <C>
Net operating loss carryforward                $ 21,739         $ 19,627 
Accrued rent expense                              5,795            5,355 
Accrued bad debt expense                          9,228            5,771 
Accrued compensation                              5,695            5,390 
Accrued liabilities                               7,966            8,186 
General business credit carryforward              8,161            7,567 
                                               --------         -------- 
Gross deferred tax assets                        58,584           51,896 
                                               --------         -------- 
Deferred tax asset valuation allowance           (4,881)          (4,328)
                                               --------         -------- 
Other                                            (5,675)          (7,353)
Partnership investment                           (5,153)          (5,308)
Depreciation and amortization                   (31,141)         (23,357)
                                               --------         -------- 
Gross deferred tax (liabilities)                (41,969)         (36,018)
                                               --------         -------- 
Net deferred tax assets (liabilities)          $ 11,734         $ 11,550 
                                               ========         ======== 
</TABLE>
Gross deferred tax assets are reduced by a valuation allowance. Realization
of the net deferred tax asset at January 1, 1998, is dependent on
generating sufficient taxable income prior to expiration of the net
operating loss carryforward.  Although realization is not assured,
management believes it is more likely than not that all of the net deferred
tax asset will be realized.  The beginning-of-year valuation allowance was 

                                    F-27
<PAGE>
increased during 1997 which caused an increase in income tax expense of
$876,000.  The beginning-of-year valuation allowances were reduced during
1996 and 1995 which caused a decrease in income tax expense of $3,641,000
and $3,622,000, respectively.

At January 1, 1998, tax benefits are available for federal income tax
purposes as follows (in thousands):

Net operating losses                                   $48,511
General business credits                                 4,195

These tax benefits will expire in the years 2003 through 2012 if not used. 
The Company also has alternative minimum tax credit carryforwards of 
$3,966,000 that can be carried forward indefinitely and offset against the
regular federal income tax liability.  In addition, the Company has net
operating loss carryforwards for state income tax purposes that will expire
in the following years if not used (in thousands):
                    1998                 $19,447
                    1999                   5,233
                    2000                   6,126
                    2001                   9,515
                    2002 to 2012          51,045

NOTE 14.  EARNINGS PER SHARE
<TABLE>
The computations under SFAS 128 of net income (loss) per common share and
net income (loss) per common share, assuming dilution, are as follows:
<CAPTION>
                                              1997       1996      1995  
                                            --------   --------  --------
<S>                                         <C>        <C>       <C>
Net income (loss)                           $  4,442   $ 20,639  $ (4,994)

Deduct: preferred stock dividends and
  losses on redemption (net of income
  tax benefits of $71, $99 and $128,
  credited to retained earnings)                (634)      (715)     (639)
                                            --------   --------  --------
Net income (loss) applicable to
  computations                              $  3,808   $ 19,924  $ (5,633)
                                            ========   ========  ========
Weighted-average common shares
  applicable to net income (loss) 
  per common share                            45,121     41,121    38,013

Effect of dilutive securities:
  Stock option incremental shares                657      1,051        --
  Assumed conversion of preferred stock          909        960        --
                                            --------   --------  --------
                                               1,566      2,011        --
Weighted-average common shares              --------   --------  --------
  applicable to net income (loss) 
  per common share assuming dilution          46,687     43,132    38,013
                                            ========   ========  ========
Net income (loss) per common share          $    .08   $    .48  $   (.15)
                                            ========   ========  ========
Net income (loss) per common share 
  assuming dilution                         $    .08   $    .46  $   (.15)
                                            ========   ========  ========
</TABLE>
                                    F-28
<PAGE>
NOTE 15.  CONTINGENCIES AND COMMITMENTS

The Company agreed to indemnify Ramada against all monetary judgments in
lawsuits pending against Ramada and its subsidiaries as of the conclusion
of the Restructuring on December 20, 1989, as well as all related
attorneys' fees and expenses not paid at that time, except for any
judgments, fees or expenses accrued on the hotel business balance sheet and
except for any unaccrued and unreserved aggregate amount up to $5,000,000
of judgments, fees or expenses related exclusively to the hotel business. 
Aztar is entitled to the benefit of any crossclaims or counterclaims
related to such lawsuits and of any insurance proceeds received.  In
addition, the Company agreed to indemnify Ramada for various lease
guarantees made by Ramada relating to the restaurant business conducted
through its Marie Callender Pie Shops, Inc. subsidiary.  In connection with
these matters, the Company has an accrued liability of $3,905,000 and
$3,931,000 at January 1, 1998 and January 2, 1997, respectively.

The Company is a party to various other claims, legal actions and
complaints arising in the ordinary course of business or asserted by way of
defense or counterclaim in actions filed by the Company.  Management
believes that its defenses are substantial in each of these matters and
that the Company's legal posture can be successfully defended without
material adverse effect on its consolidated financial statements.

The Tropicana Las Vegas lease agreement contains a provision that requires
the Company to maintain an additional security deposit with the lessor of
$21,000,000 in cash or a letter of credit if the Tropicana Las Vegas
operation fails to meet certain financial tests.  The Company has a 50%
partnership interest in the lessor.

The Company has severance agreements with certain of its senior executives. 
Severance benefits consist of a lump-sum cash payment equal to either the
sum of the executive's annual base salary plus the average of the
executive's annual bonuses awarded in the preceding three years or twice
this amount plus payment of the value in his outstanding stock options and
vesting and distribution of any restricted stock.  In certain agreements,
the termination must be as a result of a change in control of the Company. 
Based upon current salary levels and stock options, the aggregate
commitment under the severance agreements should all these executives be
terminated was approximately $9,000,000 at January 1, 1998.

NOTE 16.  FAIR VALUE OF FINANCIAL INSTRUMENTS

The following table presents (in thousands) the carrying amounts and
estimated fair values of the Company's financial instruments at January 1,
1998 and January 2, 1997, respectively.  The fair value of a financial
instrument is the amount at which the instrument could be exchanged in a
current transaction between willing parties, other than in a forced or
liquidation sale.









                                    F-29
<PAGE>
<TABLE>
<CAPTION>
                                      1997                  1996        
                               -------------------   -------------------
                               Carrying     Fair     Carrying     Fair  
                                Amount     Value      Amount     Value  
                               --------   --------   --------   --------
<S>                           <C>        <C>        <C>        <C>
Assets
  Other investments           $ 22,319   $ 22,319   $ 26,697   $ 26,697 

Liabilities
  Current portion of long-term
    debt                        27,166     27,166     12,960     12,960 
  Current portion of other 
    long-term liabilities        1,550      1,482      2,800      2,707 
  Long-term debt               491,932    526,871    527,006    532,852 
  Other long-term liabilities    3,000      2,542      5,500      4,544 

Off-Balance-Sheet
  Letters of credit                 --      6,500         --     10,250 
</TABLE>
The carrying amounts shown in the table are included, if applicable, in the
Consolidated Balance Sheets under the indicated captions.  All of the
Company's financial instruments are held or issued for purposes other than
trading.

The following notes summarize the major methods and assumptions used in
estimating the fair values of financial instruments.

Other investments consisted of deposits with the CRDA and CRDA bonds that
bear interest at two-thirds of market rates resulting in a fair value lower
than cost.  The carrying amounts of these deposits and bonds are presented
net of a valuation allowance and an unamortized discount that result in an
approximation of fair values.  Other investments at January 2, 1997, also
included a 90-day certificate of deposit which was valued at its carrying
amount which was a reasonable estimate of fair value due to the relatively
short period to maturity.

The fair values of the Company's publicly traded debt were estimated based
on the bid prices in the public bond markets.  The carrying amounts of the
revolving credit note are reasonable estimates of fair values because this
note is carried with a floating interest rate.

The amounts reported for other long-term liabilities relate to the
Company's obligation to the City of Evansville and other civic and
community organizations.  The fair values were estimated by discounting
expected cash flows using a discount rate commensurate with the risks
involved.

The fair values of the letters of credit were estimated to be the same as
the contract values based on the nature of the fee arrangement with the
issuing financial institution.








                                    F-30
<PAGE>
NOTE 17.  UNAUDITED QUARTERLY RESULTS/COMMON STOCK PRICES
<TABLE>
The following unaudited information shows selected items in thousands,
except per share data, for each quarter in the years ended January 1, 1998
and January 2, 1997.  The Company's common stock is listed on the New York
Stock Exchange.
<CAPTION>
                                   First    Second    Third     Fourth 
                                 --------  --------  --------  --------
<S>                              <C>       <C>       <C>       <C>
1997
----
Revenues                         $189,756  $200,387  $201,874  $190,340
Operating income                   17,054    21,750    21,311     7,277 
Income (loss) before income 
  taxes                               597     5,355     5,040    (8,735)
Income taxes                        2,080    (1,926)   (1,797)    3,828 
Net income (loss)                   2,677     3,429     3,243    (4,907)
Earnings per share:
  Net income (loss) per common 
   share                              .06       .07       .07      (.11)
  Net income (loss) per common 
   share assuming dilution            .05       .07       .07      (.11)

1996
----
Revenues                         $180,206  $189,493  $204,277  $203,496
Operating income                   15,613    15,388    16,130    11,812
Income (loss) before income 
  taxes                             1,371       199     1,209    (4,839)
Income taxes                         (602)     (159)   (1,162)   24,622
Net income (loss)                     769        40        47    19,783
Earnings per share:
  Net income (loss) per common
   share                              .02        --        --       .44
  Net income (loss) per common
   share assuming dilution            .02        --        --       .42


Common Stock Prices
-------------------
1997 - High                        $ 8.50    $ 7.75    $ 7.88    $ 8.00
     - Low                           6.63      6.13      6.50      5.88
1996 - High                          9.00     14.13     13.75      9.50
     - Low                           7.38      8.38      9.38      6.50

</TABLE>












                                    F-31
<PAGE>


REPORT OF INDEPENDENT ACCOUNTANTS

To the Partners
Tropicana Enterprises

We have audited the balance sheets of Tropicana Enterprises (a Nevada General
Partnership) (the "Partnership") as of January 1, 1998 and January 2, 1997,
and the related statements of operations, cash flows and partners' capital for
each of the three years in the period ended January 1, 1998.  These financial
statements are the responsibility of the Partnership's management.  Our
responsibility is to express an opinion on these financial statements based
on our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. 
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation.  We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Tropicana Enterprises as of
January 1, 1998 and January 2, 1997, and the results of its operations and its
cash flows for each of the three years in the period ended January 1, 1998,
in conformity with generally accepted accounting principles.











COOPERS & LYBRAND L.L.P.




Phoenix, Arizona
February 4, 1998










                                    F-32
<PAGE>
<TABLE>
                            TROPICANA ENTERPRISES
                       (A Nevada General Partnership)

                               BALANCE SHEETS

                    January 1, 1998 and January 2, 1997 
                    -------------------------------------
                               (in thousands)

<CAPTION>
                                                       1997        1996   
                                                    ----------  ----------
<S>                                                 <C>         <C>
Assets

  Income producing properties                       $  54,741   $  57,464 
  Cash                                                      1           1 
  Other receivable                                        943         958 
  Other assets                                         11,027      12,076 
                                                    ---------   --------- 
                                                    $  66,712   $  70,499 
                                                    =========   ========= 

Liabilities and Partners' Capital

  Term loan payable                                 $  63,304   $  66,171 
  Unearned rental income                                  884         929 
                                                    ---------   --------- 
                                                       64,188      67,100 
  Partners' capital                                     2,524       3,399 
                                                    ---------   --------- 
                                                    $  66,712   $  70,499 
                                                    =========   ========= 

</TABLE>





















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


                                    F-33
<PAGE>
<TABLE>
                            TROPICANA ENTERPRISES
                       (A Nevada General Partnership)

                          STATEMENTS OF OPERATIONS

 For the years ended January 1, 1998, January 2, 1997 and December 28, 1995
                     -----------------------------------
                               (in thousands)

<CAPTION>
                                           1997        1996        1995   
                                        ----------  ----------  ----------
<S>                                     <C>         <C>         <C>
Revenues:
  Rent                                  $  16,554   $  16,652   $  17,098 
  Interest                                     37          46          68 
                                        ---------   ---------   --------- 
                                           16,591      16,698      17,166 
                                        ---------   ---------   --------- 

Costs and expenses:
  General and administrative                    8           9           8 
  Interest                                  5,397       5,693       6,323 
  Depreciation and amortization             2,735       2,788       2,735 
                                        ---------   ---------   --------- 
                                            8,140       8,490       9,066 
                                        ---------   ---------   --------- 
Net income                              $   8,451   $   8,208   $   8,100 
                                        =========   =========   ========= 




</TABLE>





















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


                                    F-34
<PAGE>
<TABLE>
                            TROPICANA ENTERPRISES
                       (A Nevada General Partnership)

                          STATEMENTS OF CASH FLOWS

 For the years ended January 1, 1998, January 2, 1997 and December 28, 1995
                    ------------------------------------
                               (in thousands)
<CAPTION>
                                           1997        1996        1995   
                                        ----------  ----------  ----------
<S>                                     <C>         <C>         <C> 
Cash flows from operating activities:
  Net income                            $   8,451   $   8,208   $   8,100 
  Adjustments to reconcile net income 
    to net cash provided by operating
    activities:
      Depreciation and amortization         2,735       2,788       2,735 
      Changes in assets and liabilities:
        Other receivables                      15        (122)        417 
        Other assets                        1,037       1,110         636 
        Unearned rental income                (45)         14         (68)
                                        ---------   ---------   --------- 
    Net cash provided by operating 
      activities                           12,193      11,998      11,820 
                                        ---------   ---------   --------- 

Cash flows from financing activities:
  Repayment of term loan                   (2,867)     (2,674)     (2,494)
  Distribution to partners                 (9,326)     (9,324)     (9,326)
                                        ---------   ---------   --------- 
    Net cash (used in) provided by 
      financing activities                (12,193)    (11,998)    (11,820)
                                        ---------   ---------   --------- 
Net change in cash                             --          --          -- 

Cash at beginning of year                       1           1           1 
                                        ---------   ---------   --------- 
    Cash at end of year                 $       1   $       1   $       1 
                                        =========   =========   ========= 

Supplemental disclosure of cash 
  flow information:
    Interest paid                       $   5,407   $   5,633   $   6,323 
                                        =========   =========   ========= 



</TABLE>







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

                                    F-35
<PAGE>
<TABLE>
                            TROPICANA ENTERPRISES
                       (A Nevada General Partnership)

                       STATEMENTS OF PARTNERS' CAPITAL

 For the years ended January 1, 1998, January 2, 1997 and December 28, 1995
                     -----------------------------------
                               (in thousands)
<CAPTION>

                                                                  Total   
                                                                Partners' 
                                          Adamar      Jaffe      Capital  
                                        ----------  ----------  ----------
<S>                                     <C>         <C>         <C> 
Balance, December 29, 1994              $      62   $   5,679   $   5,741 
  Net income                                4,050       4,050       8,100 
  Cash withdrawals                         (4,663)     (4,663)     (9,326)
                                        ---------   ---------   --------- 
Balance, December 28, 1995                   (551)      5,066       4,515 
  Net income                                4,104       4,104       8,208 
  Cash withdrawals                         (4,662)     (4,662)     (9,324)
                                        ---------   ---------   --------- 
Balance, January 2, 1997                   (1,109)      4,508       3,399 
  Net income                                4,225       4,226       8,451 
  Cash withdrawals                         (4,663)     (4,663)     (9,326)
                                        ---------   ---------   --------- 
Balance, January 1, 1998                $  (1,547)  $   4,071   $   2,524 
                                        =========   =========  ========== 
</TABLE>



























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

                                    F-36
<PAGE>
                            TROPICANA ENTERPRISES
                       (A Nevada General Partnership)

                        NOTES TO FINANCIAL STATEMENTS

1.  Significant Accounting Policies:

  Basis of Financial Statements

  The financial statements include the accounts of Tropicana Enterprises, a
  Nevada General Partnership (the "Partnership").  Adamar of Nevada
  ("Adamar"), a wholly-owned subsidiary of Aztar Corporation ("Aztar"), and
  the Jaffe Group ("Jaffe") each hold a 50% partnership interest.  On February
  2, 1998, Aztar acquired an option to purchase the Jaffe partnership
  interest.  The option agreement extends for a period of up to 18 months and
  gives Aztar an unconditional right, but not the obligation, to purchase the
  Jaffe partnership interest.  The Partnership uses a 52/53 week fiscal year
  ending on the Thursday nearest to December 31, which includes 52 weeks in
  1997, 53 weeks in 1996 and 52 weeks in 1995. 

  The Partnership owns and leases real property (the "Tropicana Property") to
  Hotel Ramada of Nevada ("HRN") a wholly-owned subsidiary of Aztar.  This
  property is used in the operation of the Tropicana Resort and Casino in Las
  Vegas, Nevada.  Aztar has engaged an investment bank to explore alternatives
  for a major redevelopment of the Tropicana Property.  It is reasonably
  possible that the carrying value of some or all of the Partnership's assets
  may change in the near term.

  Estimates

  The preparation of financial statements in conformity with generally
  accepted accounting principles requires management to make estimates and
  assumptions that affect the amounts reported in the financial statements and
  accompanying notes.  Actual results could differ from those estimates.

  Properties

  Properties are stated at cost.  Improvements, renewals, and extraordinary
  repairs that extend the life of the asset are capitalized; other routine
  repairs and maintenance are expensed.  The cost and accumulated depreciation
  applicable to assets retired are removed from the accounts and the gain or
  loss, if any, on disposition is recognized in income as realized.

  Properties are depreciated using the straight line method over 21 to 40
  years.

  Deferred Lease Costs

  Costs directly related to signed lease agreements are capitalized and
  amortized over the term of the lease.

  Revenue Recognition

  Rental revenue is recorded on a straight line basis over the term of the
  lease.  Accrued rent, recorded in the accompanying balance sheets as other
  assets, represents cumulative amounts receivable in excess of cash basis
  rental revenue.

                                    F-37
<PAGE>
                            TROPICANA ENTERPRISES
                       (A Nevada General Partnership)

                  NOTES TO FINANCIAL STATEMENTS-(Continued)

  Income Taxes

  No federal or state income taxes are payable by the Partnership; thus, none
  have been provided for in the accompanying financial statements.  The
  partners are to include their respective share of the Partnership income or
  loss in their separate tax returns.

2.  Customer Concentration:

  The Partnership receives all of its income from HRN.  Although the
  Partnership does not anticipate a default by HRN, failure to receive
  payments on the lease would adversely affect the operating results and
  ability of the Partnership to service its debt.

3.  Income Producing Properties:

  At January 1, 1998 and January 2, 1997, the income producing properties
  consist of the following (in thousands):
                                             1997        1996   
                                          ----------  ----------
          Buildings                       $  84,226   $  84,226 
          Less accumulated depreciation     (40,902)    (38,179)
                                          ---------   --------- 
                                             43,324      46,047 
          Land                               11,417      11,417 
                                          ---------   --------- 
                                          $  54,741   $  57,464 
                                          =========   ========= 
4.  Other Assets:

  At January 1, 1998 and January 2, 1997, other assets consist of the
  following (in thousands):
                                             1997        1996   
                                          ----------  ----------
          Accrued rent                    $  10,896   $  11,933 
          Deferred lease costs                  131         143 
                                          ---------   --------- 
                                          $  11,027   $  12,076 
                                          =========   ========= 
5.  Term Loan Payable:

  On October 5, 1994, the Partnership entered into a term loan of $72,523,000,
  maturing December 31, 1999, with a group of banks.  The term loan was used
  to refinance a prior loan in the same amount.  The term loan is
  collateralized by the Tropicana Property and is serviced through rent
  payments made by the Tropicana operation.  Interest is computed based upon,
  at the Partnership's option, a one-, two-, three- or six-month Eurodollar
  rate plus a margin ranging from 1.25% to 2.50%, or the prime rate plus a
  margin ranging from zero to 1.25%.  The applicable margin to be used in
  connection with either rate is determined based upon outstanding
  indebtedness and operating cash flow of Aztar.  Interest based on the
  Eurodollar rate is payable quarterly or on the last day of the applicable 

                                    F-38
<PAGE>
                            TROPICANA ENTERPRISES
                       (A Nevada General Partnership)

                  NOTES TO FINANCIAL STATEMENTS-(Continued)

5.  Term Loan Payable: (Continued)

  Eurodollar interest period, if earlier.  Interest based on the prime rate
  is payable quarterly.  The effective interest rate was 8.33% for the year
  ended January 1, 1998.

  The carrying amounts of the term loan are reasonable estimates of the fair
  values based on the variable interest rate inherent in the loan.

  Maturities of the term loan for the five years subsequent to January 1, 1998
  are as follows (in thousands):
                                 1998                 $  3,075
                                 1999                    3,297
                                 2000                   56,932
                                                      --------
                                                      $ 63,304
                                                      ========
6.  Lease Agreement:

  In 1984, the Partnership signed an agreement to lease its operating
  facilities at the Tropicana, which expires in January 2011.  The lease
  agreement provides for contingent rental income based on the consumer price
  index and/or interest rate fluctuations in the prime or Eurodollar rates. 
  The lease of the facilities is treated as an operating lease except for the
  portion related to the furniture and equipment which was capitalized.  The
  accompanying statements of operations reflect rent revenue on a straight
  line basis over the term of the lease.  Included in the accompanying balance
  sheets under other assets is accrued rent of $10,896,000 and $11,933,000,
  as of January 1, 1998 and January 2, 1997, respectively, which represents
  future rent payments.

  Minimum future rentals on the non-cancelable operating lease as of January
  1, 1998, excluding contingent rental income as described above, are as
  follows (in thousands):
                                 1998                   14,178
                                 1999                   14,178
                                 2000                   14,178
                                 2001                   14,288
                                 2002                   14,325
                                 Thereafter            115,794
                                                     ---------
                                                     $ 186,941
                                                     =========
7.  Related Parties:

  The Partnership leases substantially all of the operating facilities at the
  Tropicana Property to HRN.  The Partnership recognized rental income of   
  $16,554,000 in 1997, $16,652,000 in 1996 and $17,098,000 in 1995 related to
  this lease.

  Aztar performs various accounting and administrative services on behalf of
  the Partnership.  No expense is allocated to the Partnership for these
  services.
                                    F-39
<PAGE>
Management's Discussion and Analysis

Financial Condition -
Liquidity and Capital Resources

Sources and Uses

The principal sources of liquidity and capital in 1997 were cash from
operations and a bank credit line.  The company's bank credit line consists
of two facilities.  The primary facility is a reducing revolving credit
facility ("Credit Facility") provided by a group of banks led by Bank of
America as managing agent; it matures on December 31, 1999.  The second
facility ("Supplemental Credit Facility" and when together with the Credit
Facility, the "Credit Facilities") is also a reducing revolving credit
facility and is provided by some members of the same group of banks as the
Credit Facility with the same managing agent; it matures on March 15, 1999. 
The maximum amount available under the Credit Facility was reduced to $147.5
million on December 31, 1997 and it will be reduced quarterly in annual
amounts of  $35 million in each year until maturity.  The maximum amount
available under the Supplemental Credit Facility was $25 million on December
31, 1997 and it will reduce quarterly beginning on June 30, 1998 by $4 million
until maturity.  As of January 1, 1998, there have been no borrowings under
the Supplemental Credit Facility.  The Credit Facilities bear a floating rate
of interest that is payable at least quarterly and sometimes more often
depending on the interest option selected by the company.  At January 2, 1997,
the outstanding balance under the Credit Facility was $160 million.  During
1997, the company borrowed $238 million and repaid $259 million, leaving an
outstanding balance of $139 million at January 1, 1998.  The Credit Facilities
impose various restrictions on the company, including limitations on its
ability to incur additional debt, commit funds to capital expenditures (as
defined), merge or sell assets.  The Credit Facilities prohibit dividends on
the company's common stock, other than dividends payable in common stock, and
repurchases of the company's common stock with certain limited exceptions. 
In addition, the Credit Facilities contain certain quarterly financial tests,
including a minimum net worth, a minimum debt service coverage ratio, a
maximum debt to operating cash flow ratio ("Leverage Ratio") and a maximum
senior debt to operating cash flow ratio ("Senior Leverage Ratio").  In
calculating the leverage ratios, uncollateralized letters of credit are
considered to be debt.  At January 1, 1998, the Leverage Ratio was 4.12 to 1
and the allowable Leverage Ratio was 4.90 to 1.  Future periodic reductions
take the allowable Leverage Ratio to 4.60 to 1 at December 31, 1998 and 4.45
to 1 at July 1, 1999.  At January 1, 1998, the Senior Leverage Ratio was 1.47
to 1 and the allowable Senior Leverage Ratio was 1.75 to 1.  The allowable
Senior Leverage Ratio decreases periodically to 1.40 to 1 at December 31, 1998
and 1.05 to 1 at December 30, 1999.

The company has commenced discussions to obtain a new bank credit line that
would increase the availability of funds and extend the maturity.  If the
company were successful in obtaining a new bank credit line, the unamortized
deferred financing charges associated with the existing bank credit line would
be written off as an extraordinary charge on the early extinguishment of debt. 
At January 1, 1998, the unamortized deferred financing charges associated with
the Credit Facilities were $2.6 million.

During 1997, the company's purchases of property and equipment related to
payments on the Evansville Riverboat Casino project completed in late 1996,
a slot machine expansion in Atlantic City and routine capital expenditures at
all of the company's locations.
                                    F-40
<PAGE>
Future Development

Tropicana Enterprises, a Nevada general partnership in which the company is
a noncontrolling 50% partner, owns the real property and certain personal
property that the company leases in the operation of the Las Vegas Tropicana. 
On February 2, 1998, the company acquired an option to purchase the 50%
partnership interest that it does not own.  The option agreement extends for
a period of up to 18 months and gives the company an unconditional right, but
not the obligation, to purchase the partnership interest for $120 million. 
The company has engaged an investment bank to explore alternatives for a major
redevelopment of the property.  The amount and timing of any future
expenditure, and the extent of any impact on existing operations, will depend
on the nature of the redevelopment ultimately undertaken by the company.

Commitments

The company is committed to making rent payments that service a bank term loan
("Term Loan") payable by Tropicana Enterprises.  The Term Loan is with the
same group of banks as the company's Credit Facility.  The Term Loan matures
on December 31, 1999, and calls for future monthly  principal payments that
total $3.1 million or $3.3 million each year, with a final payment of
approximately $57 million due at maturity.  The Term Loan balance at January
1, 1998, is approximately $63 million.  The company has commenced discussions
to extend the maturity of the Term Loan.

The Tropicana Las Vegas lease agreement contains a provision that requires the
company to maintain an additional security deposit with the lessor of
approximately $21 million in cash or a letter of credit if the Tropicana Las
Vegas operation fails to meet certain financial tests.  A determination has
been made for the year ended January 1, 1998, that the additional security
deposit was not required.  The financial tests are calculated quarterly based
on the preceding twelve months of operations.

Results of Operations -
1997 versus 1996

Aztar's consolidated revenues were $782.4 million for 1997, an increase of 1%
from $777.5 million in 1996.  Rooms revenue was higher in 1997 than in 1996
because the new hotel tower at the Atlantic City Tropicana that opened in late
April 1996 added approximately 60% to the room capacity at that property and
the company opened its 250-room hotel at Casino Aztar Evansville in December
1996.  A factor that limited the increase in consolidated revenues was that
the 1997 fiscal year included 52 weeks whereas the 1996 fiscal year included
53 weeks.

Consolidated operating income in 1997 was $67.4 million.  Consolidated
operating income in 1996 was $58.9 million after the effects of $3.0 million
in preopening cost writeoffs in connection with the new hotel tower at the
Atlantic City Tropicana and the fourth-quarter 1996 opening of a pavilion,
parking garage and hotel at Casino Aztar Evansville.  The consolidated
provision for doubtful accounts increased by $7.1 million in 1997 compared
with 1996 as a result of increasing the allowance for potential uncollectible
markers associated with Asian guests at the Las Vegas Tropicana and the
premium table game business at both Tropicanas.  Consolidated rent expense
increased $5.7 million in 1997 compared with 1996 primarily as a result of an
increased number of operating leases associated with expanded casino
facilities at the Atlantic City Tropicana.  The analysis of the performance
of each of Aztar's properties follows.
                                    F-41
<PAGE>
Tropicana Atlantic City

Tropicana Casino and Resort in Atlantic City, New Jersey had total revenues
of $399.2 million in 1997 compared with $385.9 million in 1996 and operating
income of $50.7 million in 1997 compared with $36.0 million in 1996.  The 1996
operating income is after the writeoff of $2.3 million of preopening costs
associated with the opening of a new hotel tower, an expanded casino and a
name change from TropWorld to Tropicana.  The 1996 operating margin was
negatively impacted by severe winter weather and disruption from the
construction of the new hotel tower and improvements made to the casino.

Casino revenue was up $6.7 million in 1997 compared to 1996.  Tropicana
Atlantic City continued its emphasis that began in 1995 on the games revenue
segment of the business and had a full-year benefit of the improvements made
to the casino in 1996 in connection with the games business.  As a result of
this, games revenue increased by $21.1 million or 21% in 1997 compared to 1996
in spite of a slight decline in the table games win percentage.  Slot revenue
decreased in 1997 compared to 1996 as a result of a decrease in coin offers
to slot players.  The slot revenue percentage of total casino revenue
decreased to 66% in 1997 compared to 71% in 1996 and 76% in the 1995 to 1993
time frame.  Rooms revenue increased 39% in 1997 compared to 1996 as a result
of a 30% increase in rooms occupied on a non-complimentary basis and an
increase in the average daily room rate.  The availability of rooms increased
in late April 1996 when the new hotel tower increased capacity by 60%. 

Casino costs were $13.4 million lower in 1997 compared to 1996.  A $20.5
million reduction in coin offers to slot players was partially offset by
increased costs associated with the games segment of the business.  The
reduction in coin offers consisted of a $14.3 million reduction in direct mail
and cash-back coin offers and a $6.2 million reduction in line and charter bus
coin.  Marketing costs were $6.9 million higher and the provision for doubtful
accounts was $1.9 million higher in 1997 compared with 1996 as a result of the
emphasis on the games business.  Rooms costs were 26% higher in 1997 compared
with 1996 primarily due to increased direct costs associated with the increase
in occupied rooms.  

Operating income is after depreciation and amortization of $22.1 million in
1997 compared with $21.7 million in 1996 and rent expense of $7.3 million in
1997 compared with $2.9 million in 1996.  Rent expense increased as a result
of an increased number of equipment operating leases associated with the
improved facilities.

Tropicana Las Vegas

Tropicana Resort and Casino in Las Vegas, Nevada had total revenues of $156.4
million in 1997 compared with $167.4 million in 1996 and an operating loss of
$9.3 million in 1997 compared with operating income of $0.8 million in 1996. 
Operating loss or income is after rent expense of $9.8 million in 1997
compared with $9.1 million in 1996 and depreciation and amortization of $9.5
million in 1997 compared with $8.6 million in 1996.

Casino revenue decreased by 12% in 1997 compared to 1996 primarily as a result
of a decrease in baccarat revenue.  The volume of baccarat play decreased by
40% in 1997 compared to 1996 as the company experienced a decrease in baccarat
play by Asian guests.  The volume of baccarat play was much higher in 1996
than it had been in recent years.  Baccarat revenue as a percent of casino
revenue declined to 9% in 1997 compared to 14% in 1996. Baccarat revenue was 

                                    F-42
<PAGE>
only 1% of casino revenue in 1995.  Slot revenue decreased by 10% in 1997
compared to 1996 due to a supply increase in the market.  Casino costs were
6% lower in 1997 compared to 1996 as a result of the lower casino revenue. 
The provision for doubtful accounts increased by $5.0 million in 1997 compared
with 1996 as a result of increasing the allowance for uncollectible markers
associated with Asian guests and the premium table game business.  

Ramada Express

Ramada Express Hotel and Casino in Laughlin, Nevada had total revenues of
$83.4 million in 1997 compared with $82.5 million in 1996.  The trends in 1997
were similar to those experienced in 1996.  Casino revenue increased in an
overall market that again declined in 1997. The overall market remains weak
as competition continues from Indian casinos and expansions in Las Vegas. 
Casino costs and marketing costs were higher as the company incurred increased
costs in order to increase market share in this declining market.  As a
result, the operating margin, as measured by operating income before
depreciation and amortization, declined to 21% in 1997 from 22% in 1996 and
24% in 1995.

Operating income at Ramada Express was $10.6 million in 1997 compared with
$11.2 million in 1996.  Operating income is after depreciation and
amortization of $7.1 million in both 1997 and 1996 and rent expense of $0.5
million in 1997 compared with $0.3 million in 1996.

Casino Aztar Evansville

Casino Aztar Evansville in Evansville, Indiana had total revenues of $119.3
million in 1997 compared with $115.2 million in 1996 and operating income of
$28.8 million in 1997 compared with $27.5 million in 1996.  The 1996 operating
income is after the writeoff of $0.7 million of preopening costs associated
with the opening of the passenger pavilion, parking garage and 250-room hotel.
Casino revenue was down only slightly in 1997 compared to 1996 as a decrease
in admissions as a result of the increased competition from other riverboats
in Indiana was offset by an increase in win per admission. The admissions in
1997 were 2.1 million compared to 2.4 million in 1996 and the win per
admission was $51.18 in 1997 compared with $45.85 in 1996. The existing
competition in Indiana on the Ohio River comes from two operations in the
Cincinnati, Ohio market area.  A riverboat casino has been granted a
certificate of suitability to operate in Indiana in the closer Louisville,
Kentucky market area.  This riverboat casino needs certain regulatory
approvals before it is granted a license to operate.  The owners of this
operation have commenced at-risk construction in order to be able to operate
sooner if regulatory approvals are obtained.  In addition, a fifth license
could be granted to operate a riverboat casino on the Ohio River in Indiana;
however, the Indiana Gaming Commission has delayed the consideration of this
license.  Rooms revenue was $2.7 million in 1997, an increase of $2.6 million
over 1996 as the hotel opened in December 1996.  Food and beverage revenue
increased $3.0 million over 1996 as the passenger pavilion containing expanded
food and beverage facilities opened in the fourth-quarter 1996.

Rooms costs and food and beverage costs increased with the increase in
revenues.  As a result of the expanded facilities, property taxes and
insurance, along with depreciation and amortization, also increased.  Casino
Aztar Evansville reduced marketing costs by 20% in 1997 compared to 1996. 
These costs were higher in 1996 as the operation established itself in the 


                                    F-43
<PAGE>
market.  Operating income is after depreciation and amortization of $9.3
million in 1997 compared with $8.3 million in 1996 and rent expense of $3.4
million in 1997 compared with $3.0 million in 1996.

Casino Aztar Caruthersville

Casino Aztar Caruthersville in Caruthersville, Missouri had total revenues of
$24.1 million in 1997 compared with $26.5 million in 1996 and an operating
loss of $2.8 million in 1997 compared with an operating loss of  $3.7 million
in 1996.  The operating losses are after depreciation and amortization of $3.3
million in 1997 compared with $3.5 million in 1996.  During 1997, the company
eliminated some marginal business, which resulted in lower revenues and
reduced costs.  In addition, the company implemented its plans and opened a
climate-controlled pavilion and an outdoor arena.  These facilities are used
for exhibitions, entertainment, rodeo competitions and other events.  The
company has some unused land at this site and is searching for development
opportunities with other entities to use the land for facilities that would
complement the company's operations.  The riverboat at Casino Aztar
Caruthersville floats directly on the Mississippi River and is unaffected by
the recent Missouri Supreme Court decision that requires casino riverboats in
Missouri to be operated solely over and in contact with the surface of the
rivers on which gaming is allowed by the Missouri constitution.  Other casino
riverboats in Missouri may not meet this requirement.

Development Costs

In connection with the company pursuing the development of its business in
certain gaming jurisdictions, as well as in jurisdictions in which gaming has
not been approved, the company expensed approximately $0.1 million in 1997
compared with $2.1 million in 1996.

Interest Expense

Interest expense was $62.5 million in 1997 compared with $58.6 million in
1996.  The increase in interest expense was primarily a result of
discontinuing the capitalization of interest as the company's major
construction projects were completed in phases in 1996.

Income Taxes

The company is responsible, with certain exceptions, for the taxes of Ramada
Inc. ("Ramada") through December 20, 1989.  See Note 1. Significant Accounting
Policies - Basis of Consolidated Statements of the Notes to Consolidated
Financial Statements.  The Internal Revenue Service ("IRS") has completed its
examination of the income tax returns for the years 1988 and 1989 and has
settled with Ramada for all but one issue.  Income taxes for 1997 include a
non-recurring tax benefit of $2.3 million primarily related to cash received
as a result of the settlement between the IRS and Ramada.  Income taxes for
1996 include a benefit of approximately $21 million related to this
settlement.

Results of Operations -
1996 versus 1995

Aztar's consolidated revenues were $777.5 million for 1996, an increase of 36%
from $572.9 million in 1995.  All company locations experienced higher
revenues in 1996 than in 1995 but results are not directly comparable for the 

                                    F-44
<PAGE>
following reasons.  The company's riverboat operations began in April 1995 for
Casino Aztar Caruthersville and in December 1995 for Casino Aztar Evansville,
resulting in partial-year 1995 operations and full-year 1996 operations.  The
new hotel tower at the Atlantic City Tropicana that opened in late April 1996
added approximately 60% to the room capacity at that property.  Lastly, the
1996 fiscal year included 53 weeks whereas the 1995 fiscal year included 52
weeks.

Consolidated operating income in 1996 was $58.9 million after the effects of
$3.0 million in preopening cost writeoffs in connection with the new hotel
tower at the Atlantic City Tropicana and the fourth-quarter 1996 opening of
a pavilion, parking garage and 250-room hotel at Casino Aztar Evansville. 
Consolidated operating income in 1995 was $42.7 million after the effects of
$7.7 million in preopening cost writeoffs in connection with the riverboat
operations.  The analysis of the performance of each of Aztar's properties
follows.

Tropicana Atlantic City

Tropicana Atlantic City had total revenues of $385.9 million in 1996 compared
with $332.7 million in 1995 and operating income of $36.0 million in 1996
compared with $54.5 million in 1995.  The 1996 operating income is after the
writeoff of $2.3 million of preopening costs associated with the opening of
a new hotel tower, an expanded casino and a name change from TropWorld to
Tropicana.

All revenues at Tropicana Atlantic City were higher in 1996 than in 1995. 
Casino revenue was up $48.3 million in 1996 compared to 1995 as a result of
several factors.  Tropicana Atlantic City expanded the casino in 1996 by
adding a new poker room and a new Asian games room along with an enhancement
and renovation to the baccarat room.  Tropicana Atlantic City continued its
emphasis that began in 1995 on the games revenue segment of the business. 
Games revenue increased $27.2 million or 37% in 1996 compared to 1995 in spite
of a slight decline in the table games win percentage.  Slot revenue also
increased in 1996 compared to 1995 as a result of an increase in coin
redemptions.  As a result of the change in revenue mix, the slot revenue
percentage of total casino revenue decreased to 71% in 1996 from a peak of 76%
in the 1995 to 1993 time frame.  Rooms revenue increased 45% in 1996 compared
to 1995 as a result of a 39% increase in occupied rooms and a 4% increase in
the average daily room rate in 1996 compared to 1995.  The increase in
occupied rooms was achievable as a result of a 60% increase in the room
capacity in late April 1996.  The increase in occupied rooms led to a 14%
increase in food and beverage revenue as a result of increased volume.

Consistent with the revenue increases were increases in costs.  Casino and
marketing costs were up $49.4 million in 1996 compared to 1995.  These costs
were higher as a result of increased coin redemptions, table games match play
coupons, rooms and food and beverage complimentaries and promotional expenses
such as special events, complimentary travel, commissions and off-premise
complimentaries.  Some of these increases were caused by competitive pressures
resulting from additional casino supply throughout the Atlantic City market. 
Tropicana Atlantic City also experienced an operating margin decline as a
result of severe winter weather in the 1996 first quarter and disruption from
the construction of the new hotel tower and improvements made to the casino. 
Rooms and food and beverage costs were higher in 1996 than 1995 as a result
of the increased volume associated with the expanded facilities.  General and
administrative expense increased by $7.7 million, or 43%, in 1996 compared to 

                                    F-45
<PAGE>
1995.  General and administrative expense for 1995 was net of a $2.9 million
gain associated with funds received from the Casino Reinvestment Development
Authority in conjunction with the construction of the new hotel tower.  The
increase in 1996 in general and administrative expense also reflected
increases in executive and security payroll related to the increased
promotional activities and a pretax loss on disposal of assets related to the
construction of the new casino facilities at the property.  The expanded
facilities also caused an increase in repairs and maintenance expense.

Operating income is after depreciation and amortization of $21.7 million in
both 1996 and 1995 and rent of $2.9 million in 1996 compared with $1.4 million
in 1995.  Rent expense increased as a result of an increased number of
equipment operating leases associated with the improved facilities.

Tropicana Las Vegas

Tropicana Las Vegas had total revenues of $167.4 million in 1996 compared with
$138.0 million in 1995 and an operating income of $0.8 million in 1996
compared with a $3.9 million operating loss in 1995.  Operating income or loss
is after rent expense of $9.1 million in 1996 compared with $9.2 million in
1995 and depreciation and amortization of $8.6 million in 1996 compared with
$7.8 million in 1995.  Depreciation and amortization increased in 1996 as a
result of improvements that were completed in mid-1995.

Casino revenue was 26% higher in 1996 than in 1995.  Tropicana Las Vegas had
increases in both games revenue and slot revenue in 1996.  In mid-1995, the
company began an effort to recapture some premium table game business while
maintaining slot revenue.  In 1996, the company made physical improvements to
the casino that included relocating and expanding the premium slot player
area, upgrading and expanding the baccarat room and reconfiguring other areas
of the casino.  In late 1996, the company expanded the casino into an area
that previously served as a food court.  The table games revenue excluding
baccarat increased 8% in 1996 compared with 1995 in spite of a small decrease
in the win percentage.  Baccarat revenue was the primary contributor to the
increase in casino revenue as the volume of play increased 171% along with an
increase in the win percentage to 20% in 1996 compared with 3% in 1995. 
Baccarat revenue as a percent of casino revenue was 14% in 1996 compared to
1% in 1995.  Slot revenue increased 9% in 1996 compared with 1995.  The slot
revenue percentage of casino revenue was 56% in 1996 compared to the 64% to
61% range for 1995 through 1993.  Rooms revenue increased 14% in 1996 compared
to 1995 due to an increase in average daily room rates.  Food and beverage
revenue increased 10% in 1996 compared to 1995 due to higher volume associated
with the mid-1995 introduction of a buffet and the mid-1995 capital
improvements associated with two restaurants.

The new marketing initiatives to increase the premium table game business
contributed to a 27% increase in casino and marketing costs in 1996 at the
Tropicana Las Vegas.  Food and beverage costs increased 15% as a result of the
increase in volume and an increase in the product costs as a result of the
change in revenue mix.

Ramada Express

Ramada Express had total revenues of $82.5 million in 1996 compared with $80.4
million in 1995.  Casino revenue was up 2% in 1996 from 1995 in an overall
market that declined in 1996 from 1995 and casino costs were up 4% in 1996
from 1995. The overall market remains weak as competition continues from

                                    F-46
<PAGE>
Indian casinos and expansions in Las Vegas.  Marketing costs were up 20% in
1996 compared to 1995 as the company incurred increased costs in order to
increase market share in this declining market.  As a result of the above, the
operating margin, as measured by operating income before depreciation and
amortization, declined to 22% in 1996 from 24% in 1995.

Operating income at Ramada Express was $11.2 million in 1996 compared with
$12.0 million in 1995.  Operating income is after depreciation and
amortization of $7.1 million in 1996 compared with $7.2 million in 1995 and
rent expense of $0.3 million in 1996 compared with $0.2 million in 1995.

Casino Aztar Evansville

Casino Aztar Evansville began riverboat casino operations in December 1995
utilizing temporary land-based facilities.  In the fourth-quarter 1996, the
company opened its passenger pavilion, parking garage and 250-room hotel. 
Casino Aztar Evansville was the first riverboat casino to open in Indiana. 
In 1996, five riverboat casinos opened in Indiana.  Three of these riverboat
casinos are in Northern Indiana on Lake Michigan and two are on the Ohio River
in the Cincinnati, Ohio market area.  

Casino Aztar Evansville had total revenues of $115.2 million in 1996 compared
with $5.5 million in the 1995 period of operations.  Before the effects of
writing off preopening costs of $0.7 million in 1996 and $5.1 million in 1995,
operating income was $28.2  million in 1996 compared with $0.8 million in the
1995 period of operations.  Operating income is after depreciation and
amortization of $8.3 million in 1996 compared with $0.6 million in the 1995
period of operations and rent expense of $3.0 million in 1996 compared with
$0.1 million in the 1995 period of operations.

Casino Aztar Caruthersville

Casino Aztar Caruthersville began riverboat operations in April 1995; however,
the full project was not completed until July 1995 with the opening of a
pavilion that included a restaurant, sports lounge, snack bar and other
amenities.  Caruthersville is located in a rural market that has proven to be
difficult to penetrate.  The company continues to adjust its marketing plan
in order to attract a broader customer base.  Casino Aztar Caruthersville
continued to grow its business in 1996 which resulted in marketing costs as
a percentage of casino revenue being higher than the company's consolidated
marketing costs as a percentage of casino revenue.  Casino Aztar
Caruthersville's marketing costs as a percentage of casino revenue were 21%
in 1996 and 19% in 1995 compared to the 14% in 1996 and 12% in 1995 for the
company on a consolidated basis.

Total revenues at Casino Aztar Caruthersville were $26.5 million in 1996
compared with $16.3 million in the 1995 period of operations.  Casino Aztar
Caruthersville had a $3.7 million operating loss in 1996 compared with a $2.2
million operating loss in the 1995 period of operations before the effect in
1995 of a $2.6 million writeoff of preopening costs.  The operating losses are
after depreciation and amortization of $3.5 million in 1996 compared with $2.0
million in the 1995 period of operations.

Development Costs

In connection with the company pursuing the development of its business in
certain gaming jurisdictions, as well as in jurisdictions in which gaming has 

                                    F-47
<PAGE>
not been approved, the company expensed approximately $2.1 million in 1996
compared with $1.9 million in 1995.

Interest Expense

Interest expense was $58.6 million in 1996 compared with $51.1 million in
1995.  The increase in interest expense resulted from a higher level of debt
outstanding in 1996 and a $0.8 million decrease in capitalized interest as the
company's major construction projects were completed in 1995 and 1996.

Other Matters

In June 1997, the Financial Accounting Standards Board ("FASB") adopted
Statement of Financial Accounting Standards No. 130, Reporting Comprehensive
Income ("SFAS 130"), which establishes standards for reporting and display of
comprehensive income and its components in a full set of general-purpose
financial statements.  SFAS 130 is effective for fiscal years beginning after
December 15, 1997 and requires restatement of earlier periods presented.  SFAS
130 will not have an effect on the company's financial statements currently
being presented because the company, at this time, has no items of
comprehensive income other than net income.

In June 1997, the FASB adopted Statement of Financial Accounting Standards No.
131, Disclosures about Segments of an Enterprise and Related Information
("SFAS 131"), which supersedes FASB Statement No. 14, Financial Reporting for
Segments of a Business Enterprise.  SFAS 131 establishes standards for the way
that public business enterprises report information about operating segments
in annual financial statements and requires that those enterprises report
selected information about operating segments in interim financial reports
issued to shareholders.  SFAS 131 is effective for fiscal years beginning
after December 15, 1997 and requires restatement of earlier periods presented. 
SFAS 131 will not have a material effect on the company's financial statements
as the required information is either currently being presented by the company
or it is not applicable to the company.  

In accordance with the FASB Statement of Financial Accounting Standards No.
121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of ("SFAS 121"), the company performed a review of
whether anticipated net cash flows in connection with its Casino Aztar
Caruthersville operation will be sufficient to recover the company's
investment in that operation.  At January 1, 1998, the company had
approximately $46 million in carrying value of long-lived assets and certain
identifiable intangibles associated with Casino Aztar Caruthersville.  In
performing this review, the company considered a number of factors, including,
but not limited to, anticipated revenues and the duration thereof, expected
operating costs, the competitive environment and future legislative and
regulatory changes.  Although the results of the company's review did not have
an effect on the carrying value for Casino Aztar Caruthersville at January 1,
1998, there can be no assurance that this will be true in the future.

Management has initiated an enterprise-wide program to prepare the company's
computer systems and applications for the year 2000.  This is necessary
because computer programs have been written using two digits rather than four
to define the applicable year.  The company expects to incur internal staff
costs as well as consulting and other expenses related to infrastructure and
facilities enhancements necessary to prepare the systems for the year 2000. 
Tropicana Atlantic City has undertaken a $6 million capital program, which is 

                                    F-48
<PAGE>
expected to be complete by September 1999, to purchase upgrades for its major
hardware and software systems.  When this capital program is completed, the
Atlantic City Tropicana should have addressed most of its year 2000 issues. 
Tropicana Las Vegas and Ramada Express are still evaluating their year 2000
issues.  The costs of testing and conversion are not yet known, although they
are not expected to be material.  Casino Aztar Evansville and Casino Aztar
Caruthersville use primarily third-party standard vendor software and are
working with such vendors to ensure year 2000 compliance.  The company expects
its year 2000 date conversion projects to be completed on a timely basis. 
However, there can be no assurance that the systems of other companies on
which the company's systems rely will be timely converted or that any such
failure to convert by another company would not have an adverse effect on the
company's systems.

Private Securities Litigation Reform Act

Certain information included in Aztar's 1997 Form 10-K and other materials
filed or to be filed by the company with the Securities and Exchange
Commission ("SEC")(as well as information included in oral statements or other
written statements made or to be made by the company including those made in
Aztar's 1997 annual report) contains statements that are forward-looking. 
These include forward-looking statements relating to the following activities,
among others: operation and expansion of existing properties, including future
performance; redevelopment of the Las Vegas Tropicana and financing and/or
concluding an arrangement with a partner for such redevelopment; other
business development activities; refinancing of the company's indebtedness;
and arrangement of new credit facilities.  These activities involve important
factors that could cause actual results to differ materially from those
expressed in any forward-looking statements made by or on behalf of the
company.  These include, but are not limited to, the following factors as well
as other factors described from time to time in the company's reports filed
with the SEC: construction and development factors, including zoning issues,
environmental restrictions, soil conditions, weather and other hazards, site
access matters and building permit issues; factors affecting leverage and debt
service, including sensitivity to fluctuation in interest rates; access to
available and feasible financing; regulatory and licensing approvals, third-
party consents and approvals, and relations with partners, owners and other
third parties; business and economic conditions; litigation, judicial actions
and political uncertainties, including gaming legislation and taxation; and
the effects of competition, including locations of competitors and operating
and marketing competition.  Any forward-looking statements are made pursuant
to the Private Securities Litigation Reform Act of 1995 and, as such, speak
only as of the date made.















                                    F-49
<PAGE>
<TABLE>
SUMMARY OF SELECTED FINANCIAL DATA
Aztar Corporation and Subsidiaries
For the Five Years Ended January 1, 1998
<CAPTION>
                           1997       1996      1995       1994      1993  
                         --------   --------  --------   --------  --------
<S>                     <C>        <C>         <C>       <C>       <C>
Statement of Operations
 Data (in thousands)
Revenues                $782,357   $777,472    $572,869  $541,440  $518,762
Operating income (a)      67,392     58,943      42,701    69,407    37,419
Net interest income and 
 expense (a)             (60,517)   (56,210)    (47,801)  (46,572)  (21,191)
Equity in unconsolidated
 partnership's loss       (4,618)    (4,793)     (5,081)   (4,169)   (3,822)
Income (loss) before 
 extraordinary items       4,442     20,639      (4,994)   16,804    11,382
Extraordinary items           --         --          --    (2,708)       --
Net income (loss)          4,442     20,639      (4,994)   14,096    11,382

Common Stock Data (per share)
Income (loss) before 
 extraordinary items: 
   Income (loss) per 
     common share       $    .08   $    .48   $    (.15) $    .43  $    .29
   Income (loss) per 
     common share 
     assuming dilution       .08        .46        (.15)      .41       .27
Cash dividends declared       --         --          --        --        --
Equity                      9.82       9.76        9.40      9.65      9.29

Balance Sheet Data (in 
 thousands at year end)
Total assets            $1,091,496 $1,119,582 $1,013,238 $915,359  $877,171
Long-term debt             491,932    527,006    496,439  430,212   404,086
Series B ESOP convertible
 preferred stock             6,593      6,022      5,459    4,711     3,905
Shareholders' equity       444,038    439,274    359,659  361,368   346,988

(a)  In July 1993, the Company acquired the partnership interests in
     Ambassador Real Estate Investors, L.P. ("AREI") and Ambassador General
     Partnership ("AGP").  AREI owned a 99.9% general partnership interest in
     AGP, which acquired a substantial interest in Tropicana Atlantic City in
     a sale-leaseback transaction in 1984.  The acquisition was accounted for
     as a purchase by the Company.  This acquisition did not significantly 
     change Aztar's total assets.  The cash paid by Aztar and notes receivable
     from AGP were replaced on Aztar's balance sheet by the assets acquired,
     which consisted primarily of building and equipment.  The Company's
     consolidated statements of operations include the results of AGP from its
     acquisition until its dissolution in November 1994.  After intercompany
     eliminations, the acquisition had the following effects on consolidated
     results:  Most of the reduction in Aztar interest income from the
     replacement of the AGP notes receivable was offset by a reduction in rent
     expense.  Aztar's net income was affected negatively primarily by an
     increase in depreciation expense.
</TABLE>



                                    F-50
<PAGE>
                      REPORT OF INDEPENDENT ACCOUNTANTS
                      ---------------------------------







To the Shareholders and Board of Directors
Aztar Corporation




Our report on the consolidated financial statements of Aztar Corporation and
Subsidiaries is included in this report on Form 10-K on page F-2.  In
connection with our audits of such consolidated financial statements, we have
also audited the related financial statement schedule listed in the index on
page F-1 of this Form 10-K.

In our opinion, the financial statement schedule referred to above, when
considered in relation to the basic consolidated financial statements taken
as a whole, presents fairly, in all material respects, the information
required to be included therein.









COOPERS & LYBRAND L.L.P.






Phoenix, Arizona
February 4, 1998














                                     S-1
<PAGE>
<TABLE>
               SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                     AZTAR CORPORATION AND SUBSIDIARIES
 For the Years Ended January 1, 1998, January 2, 1997 and December 28, 1995 
                               (in thousands)
<CAPTION>

    COLUMN A          COLUMN B     COLUMN C        COLUMN D      COLUMN E  
------------------  ------------ ------------    ------------  ------------

                      Balance at                                Balance at
                      Beginning                                   End of
   Description         of Year    Additions      Deductions        Year    
------------------- ------------ ------------    ----------    ------------
<S>                 <C>          <C>             <C>           <C>
Allowance for 
 doubtful accounts 
 receivable:
 1997               $  11,261    $  12,944(a)    $   6,286(b)  $  17,919
 1996                   9,905        5,892(a)        4,536(b)     11,261
 1995                  10,720        3,611(a)        4,426(b)      9,905

Deferred income 
 tax asset 
 valuation 
 allowance:
 1997               $   4,328    $   1,206(a)    $     653(b)  $   4,881
 1996                   8,196          718(a)        4,586(c)      4,328
 1995                  11,572          287(a)        3,663(c)      8,196

Valuation allowance
 for interest 
 differential on CRDA
 deposits 
 1997               $   6,425    $     569(a)    $     288(d)  $   6,706
 1996                   5,927          729(a)          231(d)      6,425
 1995                   9,233           --             365(d)      5,927
                                                     2,941(e)

(a)  Charged to costs and expenses.

(b)  Related assets charged against the account.

(c)  Reflects reductions of $3,641,000 and $3,622,000 in 1996 and 1995,
     respectively, with a corresponding decrease in income tax expense.  The
     remainder of the reductions in 1996 and 1995 represented charges of
     deferred tax assets against the valuation allowance account.

(d)  Reflects transfer to unamortized discount for the issuance of CRDA bonds.

(e)  Reflects reduction with a corresponding decrease in general and
     administrative expense associated with funds received from the CRDA in
     conjunction with the construction of the new hotel tower at Tropicana
     Atlantic City.

</TABLE>




                                     S-2
<PAGE>
EXHIBIT INDEX
-------------
3.1       Restated Certificate of Incorporation, filed as Exhibit 3.1 to
          Aztar Corporation's Registration Statement No. 33-32009 and
          incorporated herein by reference.

3.2       By-Laws, as amended and restated May 9, 1991, filed as Exhibit 1
          to Aztar Corporation's Form 8-K dated May 9, 1991 and  incorporated
          herein by reference.

4.1       Rights Agreement between Aztar Corporation and First Interstate
          Bank of Arizona, N.A. as Rights Agent, filed as Exhibit 4.1 to
          Aztar Corporation's Registration Statement No. 33-51008 and
          incorporated herein by reference.

4.2       Indenture, dated as of October 8, 1992, between Aztar Corporation
          and Bank of America National Trust & Savings Association, as
          Trustee, relating to the Senior Subordinated Notes due 2002 of
          Aztar Corporation, filed as Exhibit 4.1 to Aztar Corporation's Form
          10-Q for the quarter ended October 1, 1992 and incorporated herein
          by reference.

4.3       Supplemental Indenture Evidencing Appointment of Successor Trustee,
          dated January 12, 1995, between Aztar Corporation and First Bank
          National Association, as successor Trustee, supplementing the
          Indenture dated as of October 8, 1992, filed as Exhibit 4.3 to
          Aztar Corporation's 1994 Form 10-K and incorporated herein by
          reference.

4.4       Indenture, dated as of October 1, 1994, between Aztar Corporation
          and American Bank National Association, as Trustee, relating to the
          13 3/4% Senior Subordinated Notes Due 2004 of Aztar Corporation,
          filed as Exhibit 4 to Aztar Corporation's Form 10-Q for the quarter
          ended September 29, 1994 and incorporated herein by reference.

10.1      Amended and Restated Lease (Tropicana Hotel/Casino) between
          Tropicana Enterprises and Hotel Ramada of Nevada, dated November
          1, 1984, filed as Exhibit 10.20 to Ramada Inc.'s 1984 Form 10-K
          (Commission File Reference Number 1-5440) and incorporated herein
          by reference.

10.2      Amended and Restated Partnership Agreement by and between the Jaffe
          Group and Adamar of Nevada, entered into as of November 1, 1984,
          filed as Exhibit 10.22 to Ramada Inc.'s 1984 Form 10-K (Commission
          File Reference Number 1-5440) and incorporated herein by reference.

*10.3(a)  Severance Agreement, dated July 17, 1995, by and between Aztar
          Corporation and Paul E. Rubeli, filed as Exhibit 10.1 to Aztar
          Corporation's Form 10-Q for the quarter ended September 28, 1995
          and incorporated herein by reference.

*10.3(b)  Severance Agreement, dated July 17, 1995, by and between Aztar
          Corporation and Robert M. Haddock, filed as Exhibit 10.2 to Aztar
          Corporation's Form 10-Q for the quarter ended September 28, 1995
          and incorporated herein by reference.

*Indicates a management contract or compensatory plan or arrangement. 

                                    E-1
<PAGE>
EXHIBIT INDEX
-------------
*10.3(c)  Severance Agreement, dated July 18, 1995, by and between Aztar
          Corporation and Nelson W. Armstrong, Jr., filed as Exhibit 10.3 to
          Aztar Corporation's Form 10-Q for the quarter ended September 28,
          1995 and incorporated herein by reference.

*10.3(d)  Severance Agreement, dated July 24, 1995, by and between Aztar
          Corporation and Meridith P. Sipek, filed as Exhibit 10.4 to Aztar
          Corporation's Form 10-Q for the quarter ended September 28, 1995
          and incorporated herein by reference.

*10.3(e)  Severance Agreement, dated July 25, 1995, by and between Aztar
          Corporation and Joe Cole, filed as Exhibit 10.5 to Aztar
          Corporation's Form 10-Q for the quarter ended September 28, 1995
          and incorporated herein by reference.

*10.3(f)  Severance Agreement, dated July 17, 1995, by and between Aztar
          Corporation and Neil A. Ciarfalia, filed as Exhibit 10.6 to Aztar
          Corporation's Form 10-Q for the quarter ended September 28, 1995
          and incorporated herein by reference.

10.4(a)   Reducing Revolving Loan Agreement, dated as of October 4, 1994,
          among Aztar Corporation, Adamar of New Jersey, Inc., Ramada
          Express, Inc. and the banks therein named; Societe Generale and
          Midlantic Bank, N.A., as lead managers; Bank One, Arizona, N A and
          Credit Lyonnais, as co-agents; Bankers Trust Company, as co-
          managing agent; and, Bank of America National Trust and Savings
          Association, as managing agent, filed as Exhibit 10 to Aztar
          Corporation's Form 10-Q for the quarter ended September 29, 1994
          and incorporated herein by reference.

10.4(b)   Amendment No. 1 to Reducing Revolving Loan Agreement, dated as of
          November 3, 1995, among Aztar Corporation, Adamar of New Jersey,
          Inc., Ramada Express, Inc. and the banks therein named, filed as
          Exhibit 10.4(b) to Aztar Corporation's 1995 Form 10-K and
          incorporated herein by reference.

10.4(c)   Amendment No. 2 to Reducing Revolving Loan Agreement, dated as of
          December 28, 1995, among Aztar Corporation, Adamar of New Jersey,
          Inc., Ramada Express, Inc. and the banks therein named, filed as
          Exhibit 10.4(c) to Aztar Corporation's 1995 Form 10-K and
          incorporated herein by reference.

10.4(d)   Amendment No. 3 to Reducing Revolving Loan Agreement, dated as of
          December 30, 1996, among Aztar Corporation, Adamar of New Nersey,
          Inc., Ramada Express, Inc. and the banks therein named, filed as
          Exhibit 10.4(d) to Aztar Corporation's 1996 Form 10-K and
          incorporated herein by reference.

10.5(a)   Supplemental Reducing Revolving Loan Agreement, dated as of March
          13, 1997, among Aztar Corporation, Adamar of New Jersey, Inc.,
          Ramada Express, Inc. and the banks therein named; and Bank of
          America National Trust and Savings Association, as Managing Agent,
          filed as Exhibit 10 to Aztar Corporation's Form 10-Q for the
          quarter ended April 3, 1997 and incorporated herein by reference.

*Indicates a management contract or compensatory plan or arrangement. 
                                    E-2
<PAGE>
EXHIBIT INDEX
-------------

10.5(b)   First Amendment to Supplemental Reducing Revolving Loan Agreement,
          dated as of June 10, 1997, among Aztar Corporation, Adamar of New
          Jersey, Inc., Ramada Express, Inc. and the banks therein named; and
          Bank of America National Trust and Savings Association, as Managing
          Agent, filed as Exhibit 10 to Aztar Corporation's Form 10-Q for the
          quarter ended July 3, 1997 and incorporated herein by reference.

*10.6     Aztar Corporation 1989 Stock Option and Incentive Plan filed as
          Exhibit 4 to Aztar Corporation's Registration Statement No. 33-
          32399 and incorporated herein by reference.

*10.7(a)  Employee Stock Ownership Plan of Aztar Corporation, as amended and
          restated effective December 19, 1989, dated December 12, 1990,
          filed as Exhibit 10.60(a) to Aztar Corporation's 1990 Form 10-K and
          incorporated herein by reference.

10.7(b)   Term Loan Agreement, dated as of December 19, 1989, by and among
          State Street Bank and Trust Company, as Trustee, Adamar Garage
          Corporation, as lender, and Aztar Corporation, filed as Exhibit
          10.50(b) to Aztar Corporation's Registration Statement No. 33-51008
          and incorporated herein by reference.

10.7(c)   Preferred Stock Purchase Agreement, dated as of December 19, 1989,
          between Ramada Inc. and State Street Bank and Trust Company, as
          Trustee, filed as Exhibit 10.50(c) to Aztar Corporation's
          Registration Statement No. 33-51008 and incorporated herein by
          reference.

10.7(d)   Letter Agreement, dated as of December 19, 1989, between Aztar
          Corporation and State Street Bank and Trust Company, as Trustee,
          relating to the Employee Stock Ownership Plan of Aztar Corporation,
          filed as Exhibit 10.50(d) to Aztar Corporation's Registration
          Statement No. 33-51008 and incorporated herein by reference.

10.8(a)   Agreement and Plan of Merger, dated as of April 17, 1989, among New
          World Hotels (U.S.A.), Inc., RI Acquiring Corp. and Ramada Inc.,
          as amended and Restated as of October 23, 1989, filed as Exhibit
          2.1 to Aztar Corporation's Registration Statement No. 33-32009 and
          incorporated herein by reference.

10.8(b)   Letter, dated as of October 23, 1989, from Ramada Inc. to New World
          Hotels (U.S.A.), Inc. regarding certain franchising matters and
          hotel projects, filed as Exhibit 2.1(b) to Aztar Corporation's
          Registration Statement No. 33-32009 and incorporated herein by
          reference.

10.9      Reorganization Agreement, dated as of April 17, 1989, between
          Ramada Inc. and Aztar Corporation, as amended and restated as of
          October 23, 1989, filed as Exhibit 2.2 to Aztar Corporation's
          Registration Statement No. 33-32009 and incorporated herein by
          reference.


*Indicates a management contract or compensatory plan or arrangement. 

                                    E-3
<PAGE>
EXHIBIT INDEX
-------------
10.10     Tax Sharing Agreement, dated as of April 17, 1989, among New World
          Hotels (U.S.A), Inc., Ramada Inc. and Aztar Corporation, as amended
          and restated as of October 23, 1989, filed as Exhibit 2.3 to Aztar
          Corporation's Registration Statement No. 33-32009 and incorporated
          herein by reference.

10.11     Guaranty and Acknowledgement Agreement, dated as of April 17, 1989,
          among New World Development Company Limited, New World Hotels
          (Holdings) Limited, New World Hotels (U.S.A.), Inc. and RI
          Acquiring Corp., filed as Exhibit 2.4 to Aztar Corporation's
          Registration Statement No. 33-29562 and incorporated herein by
          reference.

10.12     Master Consent Agreement, dated July 18, 1989, by and among Ramada
          Inc., Adamar of Nevada, Hotel Ramada of Nevada, Adamar of New
          Jersey, Inc., Aztar Corporation, Tropicana Enterprises, Trop C.C.
          and the Jaffe Group, with attached exhibits, filed as Exhibit 10.50
          to Aztar Corporation's Registration Statement No. 33-29562 and
          incorporated herein by reference.

*10.13    Aztar Corporation 1990 Nonemployee Directors Stock Option Plan, as
          amended and restated effective March 15, 1991, filed as Exhibit A
          to Aztar Corporation's 1991 definitive Proxy Statement and
          incorporated herein by reference.

*10.14    Aztar Corporation Nonqualified Retirement Plan for Senior
          Executives, dated September 5, 1990, filed as Exhibit 10.2 to Aztar
          Corporation's Form 10-Q for the quarter ended September 27, 1990
          and incorporated herein by reference.

10.15     Second Amended and Restated Loan Agreement, dated October 4, 1994,
          among Tropicana Enterprises, Hotel Ramada of Nevada and the banks
          therein named; Societe Generale and Midlantic Bank, N.A., as lead
          managers; Bank One, Arizona, N A and Credit Lyonnais, as co-agents;
          Bankers Trust Company, as co-managing agent; and, Bank of America
          National Trust and Savings Association, as managing agent, filed
          as Exhibit 10.14 to Aztar Corporation's 1994 Form 10-K and
          incorporated herein by reference.

*10.16    Summary of deferred compensation program for designated executives
          of Ramada, dated November 10, 1983, filed as Exhibit 10(r) to
          Ramada Inc.'s 1983 Form 10-K (Commission File Reference Number 1-
          5440) and incorporated herein by reference.

*10.17    Deferred Compensation Agreements entered into by and between Ramada
          and designated executives (including each Executive Officer), dated
          December 1, 1983, 1984 or 1985, filed as Exhibits 10.60(a) through
          (w) to Aztar Corporation's Registration Statement No. 33-51008 and
          incorporated herein by reference.

*10.18    Deferred Compensation Plan for Directors, dated December 1, 1983,
          filed as Exhibit 10(t) to Ramada Inc.'s 1983 Form 10-K (Commission
          File Reference Number 1-5440) and incorporated herein by reference.

*Indicates a management contract or compensatory plan or arrangement. 

                                    E-4
<PAGE>
EXHIBIT INDEX
-------------

*10.19    Deferred Compensation Agreements entered into by and between Ramada
          and certain outside Directors as of December 1, 1983, filed as
          Exhibits 10.62(a),(b),(c) and (d) to Aztar Corporation's
          Registration Statement No. 33-51008 and incorporated herein by
          reference.

10.20     Option Agreement, dated February 2, 1998, between Aztar Corporation
          and parties constituting the Jaffe Group, filed as Exhibit 99.2 to
          Aztar Corporation's Form 8-K/A, dated February 3, 1998, and
          incorporated herein by reference.

**11.     Statement Regarding Computation of Per Share Earnings.

**21.     Subsidiaries of Aztar Corporation. 

**23.     Consent of Coopers & Lybrand L.L.P.

**27.     Financial Data Schedule.

































*Indicates a management contract or compensatory plan or arrangement. 

**Filed herewith

                                    E-5
<PAGE>