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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THESECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2002

Commission file number: 0-26518

FITZGERALDS GAMING CORPORATION

(Exact name of registrant as specified in its charter)


|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Nevada                                                         |  | 88-0329170                          
|(State or other jurisdiction of
incorporation or organization) |  | (I.R.S. Employer
Identification No.)

3097 E. Warm Springs Rd Suite 100, Las Vegas NV 89120

(Address of principal executive offices)(Zip Code)


(702) 940 - 2000

(Registrants telephone number, including area code)


Securities registered pursuant to Section 12(b) of the Act: None

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

Cumulative Redeemable Preferred Stock, $.01 par value


Common Stock, $.01 par value


Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period than the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. YES
x NO
o

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 the 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. o

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act). YES o NO x

As of June 30, 2002, the
aggregate market value of Registrants Common Stock held by
non-affiliates was not determinable. As of March 15, 2003, the number of outstanding shares of the Registrants
Common Stock was 5,508,082. As of March 15, 2003, approximately 1,395,048
shares of the Registrants Common Stock were held by non-affiliates of the
Registrant. The Registrants Common Stock is not listed or traded on any
exchange. For purposes of determining the number of shares held by
non-affiliates, all directors, officers, employees and five percent or greater
owners of the Registrant are deemed to be affiliates. Such determination
should not be deemed to be an admission that such persons are, in fact,
affiliates of the Registrant.

DOCUMENTS INCORPORATED BY REFERENCE

Exhibit Index located on Page E-1






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TABLE OF CONTENTS



|                          |                                                                                               |                                           |  |  |  |  |  | 
|------------------------- | --------------------------------------------------------------------------------------------- | ----------------------------------------- |  |  |  |  |  | 
|PART I                   
|                          | Item 1. Business                                                                             
|                          |                                                                                               | General                                  
|                          |                                                                                               | Bankruptcy                               
|                          |                                                                                               | Restructuring Agreement                  
|                          |                                                                                               | Operating Strategy                       
|                          |                                                                                               | Properties                               
|                          |                                                                                               | Other Operations                         
|                          |                                                                                               | Competition                              
|                          |                                                                                               | Employees                                
|                          |                                                                                               | Trade Names, Trademarks and Service Marks
|                          |                                                                                               | Governmental Regulation                  
|                          | Item 2. Properties                                                                           
|                          | Item 3. Legal Proceedings                                                                    
|                          | Item 4. Submission of Matters to a Vote of Security Holders                                  
|PART II                  
|                          | Item 5. Market for Registrants Common Equity and Related Stockholder Matters                
|                          | Item 6. Selected Financial Data                                                              
|                          | Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
|                          | Item 7A. Quantitative and Qualitative Disclosures About Market Risk                          
|                          | Item 8. Financial Statements and Supplementary Data                                          
|                          | Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 
|PART III                 
|                          | Item 10. Directors, Executive Officers and Significant Employees of Registrant               
|                          | Item 11. Executive Compensation                                                              
|                          | Item 12. Security Ownership of Certain Beneficial Owners and Management                      
|                          | Item 13. Certain Relationships and Related Transactions                                      
|                          | Item 14. Controls and Procedures                                                             
|PART IV                  
|                          | Item 15. Exhibits, Financial Statement Schedules and Reports on Form 8-K                     
|SIGNATURES               
|POWER OF ATTORNEY        
|CERTIFICATIONS           
|Exhibit 99.1 to Form 10-K
|Exhibit 99.2 to Form 10-K



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FITZGERALDS GAMING CORPORATION
2002 ANNUAL REPORT ON FORM 10-K
TABLE OF CONTENTS



|Item                                                                                              |  | Page
|------------------------------------------------------------------------------------------------- |  | ----
|PART I                                                                                            |  | 1   
|ITEM 1.     BUSINESS                                                                              |  | 1   
|General                                                                                           |  | 1   
|Bankruptcy                                                                                        |  | 1   
|Restructuring Agreement                                                                           |  | 1   
|Operating Strategy                                                                                |  | 3   
|Operating Properties                                                                              |  | 4   
|Other Operations                                                                                  |  | 6   
|Competition                                                                                       |  | 6   
|Employees                                                                                         |  | 7   
|Trade Names, Trademarks and Service Marks                                                         |  | 7   
|Governmental Regulation                                                                           |  | 7   
|ITEM 2.     PROPERTIES                                                                            |  | 12  
|ITEM 3.     LEGAL PROCEEDINGS                                                                     |  | 12  
|ITEM 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                   |  | 15  
|PART II                                                                                           |  | 16  
|ITEM 5.     MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED STOCKHOLDER MATTERS                 |  | 16  
|ITEM 6.     SELECTED FINANCIAL DATA                                                               |  | 16  
|ITEM 7.     MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS |  | 17  
|ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                              |  | 27  
|ITEM 8.     FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                                           |  | 28  
|ITEM 9.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE  |  | 28  
|PART III                                                                                          |  | 29  
|ITEM 10.  DIRECTORS, EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES OF REGISTRANT                   |  | 29  
|ITEM 11.  EXECUTIVE COMPENSATION                                                                  |  | 32  
|ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT                          |  | 35  
|ITEM 13 . CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                                          |  | 36  
|ITEM 14.  CONTROLS AND PROCEDURES                                                                 |  | 36  
|PART IV                                                                                           |  | 37  
|ITEM 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K                         |  | 37  
|SIGNATURES                                                                                        |  | 38  
|POWER OF ATTORNEY                                                                                 |  | 39  
|CERTIFICATIONS                                                                                    |  | 40  





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PART I




|        |  |         
|------- |  | --------
|Item 1. |  | Business




General

Fitzgeralds Gaming Corporation (the Company) is a gaming holding company that
until December 6, 2001 owned and operated four Fitzgeralds-brand casino-hotels,
located in downtown Las Vegas, Nevada (Fitzgeralds Las Vegas), Reno, Nevada
(Fitzgeralds Reno), Tunica, Mississippi (Fitzgeralds Tunica), and Black
Hawk, Colorado (Fitzgeralds Black Hawk). On December 6, 2001, the Company
sold substantially all of the assets and related liabilities of its Fitzgeralds
Las Vegas, Fitzgeralds Mississippi and Fitzgeralds Black Hawk properties to
Majestic Investor Holdings, LLC (Majestic). As of December 31, 2002,
Fitzgeralds Reno, had a total of 885 slot machines, 25 table games and
approximately 350 hotel rooms.

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

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




Bankruptcy

On December 5, 2000, the Company commenced cases under Chapter 11 of the
Bankruptcy Code (collectively, the Bankruptcy Cases) in the United States
Bankruptcy Court for the Northern District of Nevada (the Bankruptcy Court).
The Bankruptcy Cases are jointly administered and coordinated under Case No.
BK-N-00-33467 GWZ. The Bankruptcy Cases were commenced in accordance with an
Agreement Regarding Pre-Negotiated Restructuring, dated as of December 1, 2000
(the Restructuring Agreement) with the holders (the Consenting Noteholders)
of a majority in interest of the Companys 12.25% Senior Secured Notes (the
Notes) issued under an indenture dated December 30, 1997 (the Indenture).
The Restructuring Agreement contemplates an expeditious and orderly sale of all
of the Companys operating assets and properties as going concerns. The
Company has been informed by Contrarian Capital Advisors L.L.C.
(Contrarian), one of the Consenting Noteholders, that as
of the date hereof substantially all of the Notes held by the
Consenting Noteholders are now held by Contrarian and its affiliates.




Restructuring Agreement

The Restructuring Agreement provided a vehicle for liquidating the assets of
the Company in the Bankruptcy Court through Chapter 11 of the Bankruptcy Code.
Upon execution of the Restructuring Agreement and before commencement of the
Bankruptcy Cases, the Company distributed $13.0 million in Excess Cash (as that
term is defined in the Restructuring Agreement) to the trustee under the
Indenture

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(the Indenture Trustee) to be applied to unpaid and accrued Indenture
Trustees fees and expenses incurred and as partial payment of accrued and
unpaid interest and principal as provided in the Indenture.

Pursuant to the Restructuring Agreement and an order entered by the Bankruptcy
Court, the Company was required to distribute unrestricted cash (which includes
cash in net assets held for sale) in excess of $24.8 million to holders of its
Notes within 45 days after the end of each quarter. In May, August and
November 2001, the Company distributed $1.8 million, $7.7 million and $7.2
million, respectively, in Excess Cash to the Indenture Trustee to be applied to
accrued and unpaid interest and principal as provided in the Indenture. On
December 6, 2001, the Company sold substantially all of the assets and related
liabilities of its Fitzgeralds Las Vegas, Fitzgeralds Mississippi and
Fitzgeralds Black Hawk properties to Majestic. At that time, approximately
$133.3 million was distributed to the Indenture Trustee from the proceeds of
the sale. The Company and the Informal Committee subsequently established a
new threshold for cash reserves of $16.5 million, which was approved by the
Bankruptcy Court on November 27, 2002 and effective
November 1, 2002. Pursuant to that order, the Company
distributed $6.2 million to the Indenture Trustee to be applied to accrued and
unpaid interest and principal. As part of the Restructuring Agreement, the
Consenting Noteholders and Indenture Trustee agreed to forbear from
exercising certain of their rights otherwise allowable under the Notes and the
Indenture.

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

In accordance with the Restructuring Agreement, an auction sale was to be
scheduled for no later than June 15, 2001 in the Bankruptcy Court with respect
to those operating assets and properties not sold pursuant to negotiated sales
agreements such as the purchase agreement with Majestic. With the consent of
the Consenting Noteholders, the auction sale was not conducted and the Company
and the Consenting Noteholders executed an amendment to the Restructuring
Agreement, which was approved by the Bankruptcy Court on
November 27, 2002 and effective November 1, 2002 (the
Amended and Restated Restructuring Agreement). The
Amended and Restated Restructuring Agreement provided for the Company to attempt to conduct
the auction sale of the one remaining operating property, Fitzgeralds Reno as
soon as possible.

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

On December 2, 2002, the Bankruptcy Court issued an Order approving the
adequacy of the disclosures in the Companys Disclosure Statement and setting
deadlines for balloting and opposing confirmation of the Companys Plan of
Reorganization (the Initial Plan). The confirmation hearing on
the Initial Plan was set for March 6, 2003 but was continued to
April 21, 2003. A significant number of Consenting Noteholders,
including several Consenting Noteholders managed by Contrarian,
voted to reject the Initial Plan. The Company believes that these votes were
in violation of the obligations of the Consenting Noteholders to vote
in favor of the Initial Plan and declared the Consenting Noteholders in
breach of the Amended and Restated Restructuring Agreement and filed with the Bankruptcy
Court a motion seeking to disallow the votes. The motion to disallow
the votes was set for hearing before the  Bankruptcy Court on
March 6, 2003.

Prior to the hearing on March 6,
2003, the Company and Contrarian agreed to Amendment No. 1 to
the Amended and Restated Restructuring Agreement (the Current
Restructuring Agreement) to provide, among other matters, (i) that
Fitzgeralds Reno would not be sold, but would be retained by the
Company and (ii) for an amendment to the Initial Plan (in the form of
a Second Amended Plan of Reorganization (the New Plan)) to permit the
conversion of the indebtedness due the holders of the Notes into
equity of the successor to the Company. The Current Restructuring
Agreement, the New Plan and the Supplemental Disclosure Statement to
accompany Debtors Amended Plan of Reorganization (the
Disclosure Statement) were
filed with the Bankruptcy Court on March 20, 2003.

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

For further information concerning the Restructuring Agreement, please refer to
our Current Report on Form 8-K dated, December 6, 2001, and our subsequent
filing with the Securities and Exchange Commission. For further information
concerning the Plan of Reorganization, please refer to our Current Report on
Form 8-K dated February 27, 2003. Until such time as a Plan of
Reorganization is confirmed by the Bankruptcy Court, the Current Restructuring
Agreement, Disclosure Statement and New Plan are subject to
change.




Operating Strategy

Although the Company continues to operate the remainder of its business as
debtor in possession, because of the pendency of the Bankruptcy Cases,
substantially all of the Companys activities are subject to the supervision of
the Bankruptcy Court. The Company cannot assure that the Bankruptcy Court will
continue to permit it to operate, or that the Company will deem it to be
appropriate to continue to operate, in the manner described below.

Pending consummation of all of the transactions contemplated by the
Current Restructuring Agreement, the Companys operating strategy is to increase
profitability by utilizing its gaming brand and fully integrated player
tracking system (the Fitzgeralds Card) to further penetrate the middle-market
customer base. The Companys operating strategy is characterized by several
principal elements including:

Development of Gaming Brand

The Company has developed a gaming brand by using a consistent Irish Luck theme
throughout the casino, hotel, restaurants and bars at its Reno property. The
Company continues to use the Fitzgeralds brand pursuant to a license agreement
since the sale of the Companys other gaming properties to Majestic in December
2001. The Irish Luck theme incorporates various aspects of Irish folklore,
such as leprechauns, horseshoes, four-leaf clovers, the Blarney Stone and a pot
of gold at the end of a rainbow, as well as Irish music. The Company believes
that its theme creates an exciting and comfortable environment together with a
distinctive brand identity for customers. The Irish Luck theme allows the
Company to capitalize on its belief that every casino guest wants to feel lucky
and, by associating luck with the Fitzgeralds name, Fitzgeralds Irish Luck
becomes unique.

Middle Market Customer Focus

The Company provides a high-quality casino entertainment experience at an
affordable price to attract the middle market guests which it believes
constitute the largest segment of potential gaming customers whom the Company
can then identify, qualify and target for direct marketing activities. The
importance of friendly and efficient service is stressed continuously through
extensive employee training. The Companys approach to business includes
personal contact with trained hosts, moderately priced food,

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beverages and lodging, and the use of the Fitzgeralds Card as part of a
frequent player recognition program. The Company believes that such an
approach to business provides a comfortable, Lucky environment designed to
promote customer loyalty, a high rate of repeat business.

Emphasis on Slot Play

The Company emphasizes slot machine play, which it believes to be the fastest
growing and most profitable segment of the casino entertainment business. The
increasing popularity of slot machines is due, in part, to the continuing rapid
technological development that is resulting in the replacement of older devices
with advanced interactive electronic games and bill acceptors. These newer
games offer greater variety, higher pay outs and longer periods of play for the
casino entertainment dollar relative to simple older devices. Subject to the
availability of financing, as to which there can be no assurance, the Company
intends to continue investing in state-of-the-art machines and related
equipment and systems, such as bill acceptors and player tracking, and continue
replacing older models with the most current product offerings in an effort to
maximize revenue.




Properties

Until December 6, 2001, the Company owned and operated two Nevada properties
(Fitzgeralds Las Vegas and Fitzgeralds Reno), one Mississippi property
(Fitzgeralds Tunica) and one Colorado property (Fitzgeralds Black Hawk)
hereinafter referred to collectively as (the Properties). Currently, the
Companys only remaining gaming property is Fitzgeralds Reno, which the Company
was actively attempting to sell pursuant to the terms of the Restructuring
Agreement. Pursuant to the terms of the Current Restructuring
Agreement, efforts to sell Fitzgeralds Reno will cease. Information on Fitzgeralds Las Vegas, Fitzgeralds Tunica and
Fitzgeralds Black Hawk is provided here only for historical purposes.

Fitzgeralds Las Vegas

Fitzgeralds Las Vegas is located on the city block bounded by Fremont, Carson,
Third and Fourth Streets at the Fremont Street Experience in downtown Las
Vegas. Substantially all of the assets and related liabilities of Fitzgeralds
Las Vegas were sold to Majestic on December 6, 2001.

The Company had a 13-year franchise license agreement with Holiday Inns
Franchising, Inc. (Holiday Inns), to operate the Fitzgeralds Las Vegas hotel
as a Holiday Inn commencing in July 1996. Majestic elected not to enter into a new franchise agreement to replace the
existing franchise agreement. On October 26, 2001, the Bankruptcy Court granted
the Companys motion to remove its pre-petition franchise and other agreements
with Inns from the list of agreements to be assumed and assigned to Majestic
and subsequently granted the Companys motion to reject the franchise
agreement. The Inns then filed an unsecured claim in Bankruptcy Court claiming
liquidated damages under the franchise agreement of $1.8 million. The Company
is contesting the allowance of the claim, but cannot predict the Bankruptcy
Courts ultimate resolution of the claim.

Fitzgeralds Tunica

Fitzgeralds Tunica is located in north Tunica County, Mississippi,
approximately 30 miles from downtown Memphis, Tennessee. Fitzgeralds Tunica is
designed as an Irish castle and is the focal point of a heavily wooded, 50-acre
site situated by the Mississippi River. The Fitzgeralds Tunica casino opened
in June 1994 at a cost of approximately $46.0 million. The facility was
expanded to include a hotel and related amenities. These improvements were
substantially completed in October 1996 at a cost of approximately $34.0
million. In June 2000, the Company finished construction on a 411-space covered

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parking garage and 170 spaces of surface parking at a cost of $5.6 million.
Substantially all of the assets and related liabilities of Fitzgeralds Tunica
were sold to Majestic on December 6, 2001.

Fitzgeralds Black Hawk

Fitzgeralds Black Hawk is located adjacent to the entrance to the downtown
gaming area of Black Hawk, Colorado, next to the Gilpin Casino and across the
street from Bullwhackers. Fitzgeralds Black Hawk consists of a two-story
building, the interior of which features high ceilings and other architectural
details which sets it apart visually from many other Black Hawk casinos.
Substantially all of the assets and related liabilities of Fitzgeralds Black
Hawk were sold to Majestic on December 6, 2001.

Fitzgeralds Reno

Fitzgeralds Reno, built in 1978, is located in downtown Reno on the corner of
Virginia Street and Commercial Row next to the landmark Reno Arch. The Company
acquired the facility in December 1986. At December 31, 2002, the facility
consisted of a 16-story, 350-room hotel and a casino offering 885 slot
machines, 25 table games, a 73-seat keno lounge and a sports book (operated by
a third party). Amenities include three restaurants, four bars, an
entertainment lounge and a gift shop. During the period from 1998  2001, the
Company renovated portions of Fitzgeralds Reno at a cost of approximately $1.8
million. Historically, Fitzgeralds Reno leased parking spaces in an adjacent
834-space parking garage on an annual basis with no certainty that the lease
would be renewed from year to year. Since available parking in downtown Reno
is limited, on February 1, 2000, Fitzgeralds Reno acquired ownership of the
garage for $3.0 million as well as an assignment of the underlying ground
lease. The original term of the ground lease expires on February 28, 2013, and
has been extended for one additional period of ten years.

The Fitzgeralds Reno marketing strategy is to capitalize on the high level of
pedestrian traffic surrounding Fitzgeralds Reno, which is located in the heart
of downtown Reno adjacent to the landmark Reno Arch. Fitzgeralds Reno maintains
active sidewalk marketing programs aimed at attracting pedestrians into the
casino. To further increase Fitzgeralds Renos appeal and convenience, the
Company constructed an enclosed temperature-controlled, pedestrian bridge (the
Rainbow Skyway), which connects the sidewalk located across the railroad
tracks near the entrance to the Eldorado Hotel and Casino to the upgraded
second floor casino of Fitzgeralds Reno. Fitzgeralds Reno guests entering via
the Rainbow Skyway step into a Lucky Forest and are greeted at the
Fitzgeralds Card Center. The second floor of the casino has been further
upgraded with the addition of new slot machines, specialty table gaming
products and a renovated restaurant in anticipation of increased traffic flow
from the Rainbow Skyway. The cost of the Rainbow Skyway was approximately $2.3
million, of which $1.0 million was funded by the Union Pacific Railroad with
the balance by the Company. The Rainbow Skyway was opened to the public in
February 1998. The Rainbow Skyway was constructed over air rights that were
acquired by the Company from the Southern Pacific Railroad. Such air rights may
be subject to a claim of ownership (or claim of an ownership interest) by the
United States of America. Although the Company believes it is unlikely that the
United States of America would, in a manner adverse to the Company, exercise
any right, title, or interest it may hold or obtain in the air rights parcel,
no assurance can be made that such an exercise will not occur.

During the year ended December 31, 2002, average occupancy and average room
rates were 83.8% and $47.20, respectively. With regard to the impact of the
Reno Transportation Rail Access Corridor (ReTRAC) Project, see
Item 3 -  Legal
Proceedings.

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Other Operations

Cliff Castle Casino

Cliff Castle Casino (Cliff Castle) is a gaming facility owned and operated by
the Yavapai-Apache Nation (the Nation) located in Camp Verde, Arizona. In
May 1995, Fitzgeralds Arizona Management, Inc. (FAMI), an 85%-owned
subsidiary of the Company, entered into an exclusive agreement (the Cliff
Castle Management Agreement) to manage Cliff Castle for five years. In June
1998, FAMI entered into a termination agreement with the Nation, wherein the
parties mutually agreed to terminate the Cliff Castle Management Agreement.

Turning Stone Casino

In consideration of work performed by the Company pursuant to an agreement with
the Oneida Indian Nation to manage Turning Stone Casino (Turning Stone)
located in Verona, New York, the Company received monthly payments of $133,333
through September 1998.




Competition

There is intense competition among companies in the gaming industry, many of
which have greater name recognition and financial and marketing resources than
the Company. In addition to the regional competitors described below, the
Company competes with gaming facilities nationwide, including land-based
casinos in Nevada and other jurisdiction, not only for customers but also for
employees and potential future gaming sites. The Company also competes, to
some extent, with other forms of gaming on both a local and a national level,
including state-sponsored lotteries, on and off-track wagering and card
parlors. The recent and continuing expansion of legalized casino gaming to new
jurisdictions throughout the United States, and particularly the expansion of
Indian Gaming in California, has affected competitive conditions faced by the
Company and will continue to do so in the future. As of the date hereof, the
filing of the Bankruptcy Cases has not had a material adverse impact on the
Companys gaming operations; however there can be no assurance that the Company
will not incur a material adverse consequences in the future.

Reno Operations

Fitzgeralds Reno encounters strong competition from other hotel and casino
facilities in the Reno area as well as competition from gaming establishments
in other areas of Nevada and, to a lesser extent, other jurisdictions in the
United States where gaming has been legalized (particularly Indian gaming
establishments in California). Fitzgeralds Reno competes with other properties
principally on the basis of location and direct marketing. Additional
competition may come from the expansion or construction of other hotel and
casino properties or the upgrading of other existing facilities in the Reno
area. There can be no assurance that such growth will not adversely affect the
pricing policies at Fitzgeralds Reno, including the room pricing policies.

In addition, management believes that the introduction of casino gaming or the
expansion of presently conducted gaming operations, particularly at Indian
casinos in areas in or close to Nevada, such as California, Oregon, Washington,
Arizona and western Canada, is likely to continue to have an adverse effect on
operations.

Pursuant to an amendment to the California Constitution, approved by voters in
March 2000 and California tribalstate gaming compacts, casino gaming is now
permitted in California. The maximum

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number of slots permitted for any one tribe is 2,000, with the maximum number
of slots currently estimated to be 61,700 for the 53 tribes. The maximum
number of allowed slots continue to be an issue and increases in the maximum
number of slots allowed is being actively discussed between the tribes and the
State of California. Three years after any Compact is approved, the tribe may
renegotiate to request an increase in the number of its slot machines.
California tribes have the right to operate any banking or percentage card
game; however, although craps and roulette are not available as of the date
hereof, they may become available.

The Companys ability to maintain its competitive position in Reno will require
the expenditure of sufficient funds for such items as updating slot machines to
reflect changing technology, periodic refurbishing of rooms and public service
areas, and replacing obsolete equipment on an ongoing basis. Because the
Company is subject to the supervision of the Bankruptcy Court, is highly
leveraged, lacks financial flexibility by virtue of the constraints of the
Restructuring Agreement, the Bankruptcy Code and the obligation to make
Post-petition Distributions, is in default on its Notes, and may not generate
sufficient funds internally, there can be no assurance that the Company will
generate sufficient funds internally or obtain sufficient additional financing
to fund such expenditures or that any such arrangement would be approved by the
Bankruptcy Court.




Employees

As of December 31, 2002, the Company employed approximately 668 people.
Approximately 660 people were employed at the Fitzgeralds Reno property with
the balance employed at the Companys corporate offices.




Trade Names, Trademarks and Service Marks

The Company believes that its distinctive trade names, trademarks and service
marks are important. In connection with the December 2001 sale of the Companys
Fitzgeralds Las Vegas, Fitzgeralds Tunica and Fitzgeralds Black Hawk to
Majestic, the Company negotiated a 99-year, royalty free license, to continue
utilizing the trade names, trademarks and service marks in specified geographic
areas generally comprising Northern Nevada, California, Oregon and Washington.
If the rights are not adopted and continuously used anywhere in Oregon and
Washington by December 6, 2011, their use in such locations thereafter during
the term of the license would bear a market rate royalty to be determined. The
license is subject to other customary terms and conditions and is not
transferable without the consent of the licensor except in the event of the
sale of Fitzgeralds Reno.




Governmental Regulation

Nevada Gaming Regulation

The ownership and operation of the Companys Fitzgeralds Reno casino gaming
facility subject to the Nevada Gaming Control Act and the regulations
promulgated thereunder (the Nevada Act) and to the licensing and regulatory
control of the Nevada Gaming Commission (the Nevada Commission), the Nevada
State Gaming Control Board (the Nevada Board) and various local ordinances
and regulations, including, without limitation, applicable city and county
gaming and liquor licensing authorities (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

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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 filing periodic
reports with the Nevada Gaming Authorities; (iv) the prevention of cheating and
fraudulent practices; and (v) providing 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s gaming operations.

The Companys direct and indirect subsidiaries that conduct gaming operations
are 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 (a Registered Corporation) and has been found suitable to
own the stock of FSI and FRI. FSI is registered as an intermediary company (an
Intermediary Company) and has been found suitable to own the stock of FLVI,
which has been licensed as a manufacturer and distributor of gaming devices and
to conduct nonrestricted gaming operations at Fitzgeralds Las Vegas. FRI has
been licensed as a manufacturer and distributor of gaming devices and to
conduct nonrestricted gaming operations at Fitzgeralds Reno. FLVI and FRI are
each a corporate gaming licensee (a Corporate Licensee or individually a
Nevada Gaming Subsidiary and collectively the Nevada Gaming Subsidiaries)
under the terms of the Nevada Act. No person may become a stockholder of, or
receive any percentage of profits from, an Intermediary Company or a Nevada
Gaming Subsidiary without first obtaining licenses and approvals from the
Nevada Gaming Authorities. The Company, FSI and the Nevada Gaming Subsidiaries
have obtained from the Nevada Gaming Authorities the various registrations,
findings of suitability, approvals, permits and licenses required in order to
engage in gaming activities in Nevada. The following statutory and regulatory
requirements are currently applicable to the Company, FSI and the Nevada Gaming
Subsidiaries, including requirements applicable to the Company as a Registered
Corporation.

The Nevada Gaming Authorities may investigate any individual who has a material
relationship to, or material involvement with, the Company, FSI or the Nevada
Gaming Subsidiaries 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 the Nevada Gaming Subsidiaries 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 or FSI who are actively and directly
involved in gaming activities of the Nevada Gaming Subsidiaries 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 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, FSI or the Nevada Gaming Subsidiaries, the
companies involved would have to sever all relationships with such person. In
addition, the Nevada Commission may require the Company, FSI or the Nevada
Gaming Subsidiaries 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.

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The Company, FSI and the Nevada Gaming Subsidiaries are required periodically
to submit detailed financial and operating reports to the Nevada Commission and
furnish any other information which the Nevada Commission may require.
Substantially all material loans, leases, sales of securities and similar
financing transactions by the Nevada Gaming Subsidiaries must be reported to or
approved by the Nevada Commission.

If it were determined that the Nevada Act was violated by FSI or any Nevada
Gaming Subsidiary, the registration or gaming licenses they hold could be
limited, conditioned, suspended or revoked, subject to compliance with certain
statutory and regulatory procedures. In addition, the Company, FSI, the Nevada
Gaming Subsidiaries 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 Fitzgeralds Reno and, under certain circumstances,
earnings generated during the supervisors appointment (except for reasonable
rental value of the casino) could be forfeited to the State of Nevada.
Limitation, conditioning or suspension of the gaming licenses of the Nevada
Gaming Subsidiaries or the appointment of a supervisor could (and revocation of
any gaming license would) have a material adverse effect on the Companys
gaming operations.

Any beneficial holder of a Registered Corporations voting securities (or
rights to acquire such securities), regardless of the number of shares owned,
may be required to file an application, be investigated and have his or her
suitability as a beneficial holder of the Registered Corporation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 beneficial ownership of more
than 5% of a Registered Corporations voting securities to report the
acquisition to the Nevada Commission. The Nevada Act requires that beneficial
owners of more than 10% of a Registered Corporation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 a
Registered Corporation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 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 Registered Corporation, any change in the corporate
charter, bylaws, management, policies or operations of the Registered
Corporation, or any of its gaming affiliates, or any other action which the
Nevada Commission finds to be inconsistent with holding the Registered
Corporation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.

The Nevada Act provides that each person who acquires, directly or indirectly,
beneficial ownership of any debt security in a Registered Corporation may be
required to be found suitable if the Nevada

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Commission has reason to believe that the acquisition of such debt security
would otherwise be inconsistent with the declared policy of the State of
Nevada.

The Nevada Commission may, in its discretion, require the holder of any debt
security of a Registered Corporation 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, he shall not hold, directly or indirectly, the
debt security of the publicly registered company, beyond the time prescribed by
the Nevada Commission. 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 rights 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.

Any person who fails or refuses to apply for a finding of suitability or a
license within 30 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 beyond such period
of time as may be prescribed by the Nevada Commission may be guilty of a
criminal offense. The Company will be 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 or the Nevada Gaming Subsidiaries, 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 including, if necessary, the immediate
purchase of said voting securities for cash at fair market value.
Additionally, the City of Reno had the authority to approve all persons owning
or controlling the stock of any corporation controlling a gaming licensee.

The Nevada Commission may, in its discretion, require the holder of any debt or
similar security of a Registered Corporation to file applications, be
investigated and be found suitable to own the debt security of a Registered
Corporation if the Nevada Commission has reason to believe that such ownership
would otherwise be inconsistent with the declared policies of the State of
Nevada. 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 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 will also be 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

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bear a legend indicating that the securities are subject to the Nevada Act. To
date, the Nevada Commission has not imposed such a requirement on the Company.

The Company may not make a public offering of its securities without the prior
approval of the Nevada Commission if the securities or 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.

Changes in control of a Registered Corporation 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 corporate 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 licensees 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 Registered Corporation 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
Registered Corporations Board of Directors 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 casino operations where entertainment is
furnished in connection with the selling or serving of food or refreshments or
the selling of merchandise. Nevada licensees that hold a manufacturers
license or a distributors license, such as the Nevada Gaming Subsidiaries,
also pay certain fees and taxes to the State of Nevada.

Any person who is licensed, required to be licensed, registered, required to be
registered, or is under common control with such persons (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 by the Nevada Board for their participation in such foreign
gaming. The revolving fund is subject to increase or decrease in the
discretion of the Nevada Commission. Thereafter, foreign Licensees are
required to

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comply with certain reporting requirements imposed by the Nevada Act. Such
licensees are also subject to disciplinary action by the Nevada Commission if
they knowingly violate any laws of the foreign jurisdiction pertaining to the
foreign gaming operation, fail to conduct the foreign gaming operation in
accordance with the standards of honesty and integrity required of Nevada
gaming operations, engage in activities or enter into associations that are
harmful to the State of Nevada or its ability to collect gaming taxes and fees,
or employ, contract with or associate with a person in the foreign operation
who has been denied a license or finding of suitability in Nevada on the
grounds of personal unsuitability.

The Company has established, and will be required to maintain, a Gaming
Compliance Program for the purpose of, at a minimum, performing due diligence,
determining the suitability of relationships with other entities and
individuals and to review and ensure compliance by the Company, its
subsidiaries and any affiliated entities, with the Act and Regulations and the
laws and regulations of any other jurisdiction in which the Company or its
subsidiaries or affiliates operate. The Gaming Compliance Program, any
amendments thereto, and the members, one such members which shall be
independent, shall be administratively reviewed and approved by the Chairman of
the Nevada Board. The Company shall amend the compliance program or any element
thereof, and perform such duties as may be assigned by the Chairman of the
Nevada Board or his designee, related to review of activities relevant to the
continuing qualification of the Company.

The sale of alcoholic beverages at Fitzgeralds Reno is subject to licensing,
control and regulation by the City of Reno. All licenses are revocable and are
not transferable. The agencies involved have 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 on the operations of the
Nevada Gaming Subsidiaries.




|        |  |           
|------- |  | ----------
|Item 2. |  | Properties

Reference is made to the information contained in Part I, Item 1. Business -
Propertiesof this Report on Form 10-K.




|        |  |                  
|------- |  | -----------------
|Item 3. |  | Legal Proceedings

Reno Transportation Rail Access Corridor (ReTRAC) Project

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

Based on plans prepared by the City, Fitzgeralds Reno would expect to lose
permanently approximately 3,802 square feet of land and temporarily 22,979
square feet of land through eminent domain, several parking spaces, the current
valet parking area, an outdoor billboard structure advertising available rooms
and a building used to house administrative offices, and may be required to
relocate the hotel entrance currently on Commercial Row. The City has also
indicated that the ReTRAC Project might require the demolition of the
Fitzgeralds Reno Rainbow Skyway if underpinning during construction of the
ReTRAC Project cannot preserve the structure. Implementation of the ReTRAC
Project under these circumstances would cause the Company to suffer significant
and permanent loss in business revenue and income;

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certain operating efficiencies from demolished or impaired physical structures;
and a portion of its existing customer base as a result of the construction and
operation of the proposed rail bypass.

On November 30, 1998, the Company filed a lawsuit against the City to challenge
the method by which the special assessment to be levied against the Company was
determined. The City of Reno filed an answer to the Companys lawsuit on
January 19, 1999. Subsequent thereto, George Karadanis and Robert Maloff d/b/a
Sundowner Hotel and Casino (the Sundowner) were permitted by court order to
file a Complaint in Intervention. Notwithstanding that intervention, on
December 22, 1999, the court granted the City of Renos Motion for Summary
Judgment against the Sundowner which motion was joined in by the Company.
After hearing oral arguments and considering the parties briefs, the Court
concluded that there was insufficient evidence before the Reno City Council to
support a finding that the ReTRAC Project confers a special benefit on
Fitzgeralds Reno as is required by statute before a special assessment may be
imposed. The Court remanded the matter to the Reno City Council and directed
the council to conduct a new hearing to consider evidence as to whether
Fitzgeralds Reno would receive a special benefit from the proposed project.

On June 20, 2001, the Reno City Council commenced a public hearing in
compliance with the remand order of the Court. That public hearing was
recessed and continued to November 29, 2001. After resuming the hearing on
November 29, 2001, the Reno City Council again recessed and continued the
proceedings to January 4, 2002, at which time the hearing was completed and the
matter was submitted for decision of the Reno City Council. On February 19,
2002, the Reno City Council voted on the matter. By a 4-3 decision, the Reno
City Council concluded that the ReTRAC Project would confer a special benefit
on Fitzgeralds Reno. On a 5-2 decision, however, the Reno City Council
determined that the value of the special benefit in light of the evidence
presented was $1.00.

On February 27, 2001, the Reno City Council voted to continue the process of
determining the actual cost of construction of the ReTRAC Project, which the
City has estimated to be recently $282 million. On May 24, 2001, Fitzgeralds
Reno commenced an action, CV-N-01-0329-PMP-RAM, in the United States District
Court for the District of Nevada, against the Federal Highway Administration
(FHWA), the Nevada Department of Transportation (NDOT), and the City
(collectively, the Defendants) for violations of the National Environmental
Policy Act (NEPA), codified at 42 U.S.C. §§ 4321-4327. The claims against
all Defendants allege a violation of 42 U.S.C. § 4332 (Violation of NEPA:
Failure to Consider Reasonable Alternatives & Failure to Consider and Provide
Adequate Mitigation Measures). Specifically, Fitzgeralds Reno asserts the
Defendants failed to consider the Partial Cover and Cut Tunnel Alternative and
the use of the Feather River Route on a temporary basis, and failed to include
a plan for mitigating the adverse environmental impacts, including construction
disruption, loss of operating facilities, noise and vibration impacts, that
will be caused by the ReTRAC Project and incurred by Fitzgeralds Reno and
others.

On or about June 12, 2001, NDOT filed a motion to dismiss the Companys NEPA
complaint based on a claim of sovereign immunity and the Company moved to amend
its complaint to substitute as a defendant the Director of NDOT, Thomas E.
Stephens, for the Defendant NDOT, in lieu of considering NDOTs Eleventh
Amendment immunity claim. This unopposed motion was granted by the Court on
August 17, 2001, and the Company filed its amended complaint on August 23,
2001. Defendant FHWA filed its answer to the Complaint on September 6, 2001
and Defendant Stephens filed his answer on October 3, 2001. The City filed a
motion to dismiss the amended complaint so far as it named the City as
defendant on September 6, 2001. On February 15, 2002, the United States
District Court held a hearing to consider the Citys motion to dismiss. At the
hearing, the Defendant FHWA and the Defendant NDOT joined the Citys motion to
dismiss. The Citys motion to dismiss was fully argued and submitted to the
Court for a ruling. On March 11, 2002, the Court issued an order dismissing
all of the Companys claims against the

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City. The Court ruled the ReTRAC Project must comply with NEPA but the
specific federal aid statute under which the City is receiving funding for the
ReTRAC Project does not explicitly require the local government body to consent
to suit under NEPA. Accordingly, the Court found the City was not a proper
party in the case. The Court, however, denied the motions to dismiss by FHWA
and NDOT stating the Company is entitled to proceed on the claims against those
agencies for a violation of NEPA. The remaining parties  Fitzgeralds Reno,
FHWA and NDOT  filed cross motions for summary judgment on December 23, 2002.
These parties oppositions to the respective cross motions for summary judgment
were filed on February 18, 2003. The cross motions for summary judgment was
orally argued on February 26, 2003. On March 6, 2003, Judge Pro entered an
order and judgment dismissing Fitzgeralds Renos claim against the FHWA and
NDOT on the grounds the claims raised did not satisfy the applicable arbitrary
and capricious standard under NEPA and only alleged generalized and
speculative environmental harms. The Company is evaluating its legal options
concerning the Courts decision and judgment.

The City completed its construction cost analysis in July 2002. Construction
contracts for the ReTRAC Project were awarded by the City Council on July 16,
2002. Preliminary construction activities have commenced and on February 25,
2003, the City Council adopted a resolution of intent to commence in the future
eminent domain proceedings against the Company to acquire from Fitzgeralds Reno
fee title to approximately 3,802 square feet of land and a 4,524 square foot
administrative office building owned and used by the Company, as well as
temporary easements for approximately 22,979 square feet of land to facilitate
construction of the ReTRAC Project. The Company also is discussing with the
City certain federal government benefits for the relocation and displacement of
businesses in connection with the ReTRAC Project.

Other Litigation

The Company is a party to various lawsuits relating to routine matters
incidental to its business. Except as noted below, the Company does not believe
that the outcome of such litigation, individually or in the aggregate, will
have any material adverse effect on its financial condition.

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

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coverage period for which Reliance was the Companys insurance carrier or
whether any limitations on coverage would have a material adverse effect on the
Companys financial condition.




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

None.

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PART II




|        |  |                                                                      
|------- |  | ---------------------------------------------------------------------
|Item 5. |  | Market for Registrants Common Equity and Related Stockholder Matters

The Companys Common Stock is not listed or traded on any exchange. As of
February 21, 2003, the Company had 42 shareholders of record.

In December 1995, as part of a public offering of $123.0 million senior secured
notes (the 1995 Notes) and Preferred Stock, the Company issued 2,675,237
warrants, each exercisable for one share of the Companys Common Stock, at an
exercise price of $.01 per share (the Warrants). In December 1997,
concurrently with the redemption of the 1995 Notes, the Company canceled
703,402 of the Warrants. The remaining Warrants had an expiration date of
December 19, 1998. The Warrant Agent received timely notice of exercise for
1,495,236 Warrants and 476,599 Warrants expired. In September 1999, a total of
1,495,236 shares of Common Stock was issued to the exercising Warrant holders
in reliance on the exemption from registration contained in Section 4(2) of the
Securities Act of 1933 on the basis that there was no public offering of the
Common Stock underlying the Warrants. The Company received $14,952,
representing the exercise price of the Warrants.

The Company has not paid any cash dividends on its Common Stock and, because of
the Bankruptcy Cases, the Bankruptcy Code and the Restructuring Agreement, the
Company does not anticipate paying cash dividends (including those with respect
to its Preferred Stock). For the same reasons the payment of dividends is no
longer within the discretion of the Companys Board of Directors.

The Current Restructuring Agreement
requires, and the New Plan provides, that as part of the liquidation process,
all of the existing common stock and preferred stock of the Company is to be
canceled and extinguished without any payment. Therefore, no distribution will be made to holders of the existing capital stock of
the Company.




|        |  |                        
|------- |  | -----------------------
|Item 6. |  | Selected Financial Data

Fitzgeralds Gaming Corporation

|                              |                                   |          |   |                                             |       |      |   |         |       |      |   |         |       |   |   |         |       |   |   |         |       |  
|----------------------------- | --------------------------------- | -------- | - | ------------------------------------------- | ----- | ---- | - | ------- | ----- | ---- | - | ------- | ----- | - | - | ------- | ----- | - | - | ------- | ----- | -
|                              |                                   |          |   | December 31,                               
|                              |                                   |          |   |                                            
|                              |                                   |          |   | 2002                                        |       | 2001 |   | 2000    |       | 1999 |   | 1998   
|                              |                                   |          |   |                                             |       |      |   |         |       |      |   |        
|                              |                                   |          |   | (in thousands except for per share amounts)
|Statement of Operations Data: |                                   |          |   |                                             |       |      |   |         |       |      |   |         |       |   |   |         |       |   |   |        
|                              | Net Operating Revenues            |          | $ | 37,001                                      |       |      | $ | 196,031 |       |      | $ | 200,102 |       |   | $ | 191,845 |       |   | $ | 199,993 |      
|                              | Income (Loss) from Operations (1) |          |   | (4,114                                      | )     |      |   | 9,969   |       |      |   | 14,481  |       |   |   | 11,399  |       |   |   | 21,680  |      
|                              | Interest Expense, Net             |          |   | 1,207                                       |       |      |   | 4,528   |       |      |   | 30,803  |       |   |   | 29,168  |       |   |   | 26,646  |      
|                              | Net Income (Loss)                 |          |   | (5,327                                      | )     |      |   | 4,317   |       |      |   | (16,386 | )     |   |   | (17,954 | )     |   |   | (8,667  | )    
|                              | Net loss per common share:        |          |   |                                             |       |      |   |         |       |      |   |         |       |   |   |         |       |   |   |         |      
|                              |                                   | Net Loss |   | $                                           | (2.54 | )    |   | $       | (0.58 | )    |   | $       | (4.14 | ) |   | $       | (5.35 | ) |   | $       | (3.35 | )

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|                    |                                         |                                                      |  |              |          |      |  |       |          |      |  |        |         |   |  |        |         |   |  |        |         |  
|------------------- | --------------------------------------- | ---------------------------------------------------- |  | ------------ | -------- | ---- |  | ----- | -------- | ---- |  | ------ | ------- | - |  | ------ | ------- | - |  | ------ | ------- | -
|                    |                                         |                                                      |  | December 31,
|                    |                                         |                                                      |  |             
|                    |                                         |                                                      |  | 2002         |          | 2001 |  | 2000  |          | 1999 |  | 1998  
|                    |                                         |                                                      |  |              |          |      |  |       |          |      |  |       
|Other Data:         |                                         |                                                      |  |              |          |      |  |       |          |      |  |        |         |   |  |        |         |   |  |       
|                    | Ratio of Earnings to Fixed Charges: (2) |                                                      |  |             |          |      |  | 1.8x  |          |      |  |       |         |   |  |       |         |   |  |       |        
|                    | Net Cash Provided by (Used in):         |                                                      |  |              |          |      |  |       |          |      |  |        |         |   |  |        |         |   |  |        |        
|                    |                                         | Operating activities                                 |  | $            | (7,989   | )    |  | $     | (22,106  | )    |  | $      | 10,564  |   |  | $      | 21,089  |   |  | $      | 12,189  |  
|                    |                                         | Investing activities                                 |  |              | 3,391    |      |  |       | 135,039  |      |  |        | (13,647 | ) |  |        | (1,961  | ) |  |        | (5,451  | )
|                    |                                         | Financing activities                                 |  |              | (6,486   | )    |  |       | (105,617 | )    |  |        | (739    | ) |  |        | (10,051 | ) |  |        | (8,509  | )
|                    | Depreciation and Amortization           |                                                      |  | 30           |          |      |  | 34    |          |      |  | 13,978 |         |   |  | 14,203 |         |   |  | 13,671 |        
|                    | Capital Expenditures                    |                                                      |  | 541          |          |      |  | 1,815 |          |      |  | 13,508 |         |   |  | 6,184  |         |   |  | 9,352  |        
|Balance Sheet Data: |                                         |                                                      |  |              |          |      |  |       |          |      |  |        |         |   |  |        |         |   |  |       
|                    |                                         | Cash                                                 |  | $            | 14,525   |      |  | $     | 25,609   |      |  | $      | 8,181   |   |  | $      | 22,116  |   |  | $      | 13,039  |  
|                    |                                         | Total Assets                                         |  |              | 35,466   |      |  |       | 51,372   |      |  |        | 188,048 |   |  |        | 206,796 |   |  |        | 209,197 |  
|                    |                                         | Net Assets held for Sale                             |  |              | 12,490   |      |  |       | 12,000   |      |  |        | 170,388 |   |  |        |        |   |  |        |        |  
|                    |                                         | Short-Term Debt                                      |  |              | 122      |      |  |       | 111      |      |  |        | 110     |   |  |        | 203,840 |   |  |        | 4,940   |  
|                    |                                         | Long-Term Debt                                       |  |              | 2,174    |      |  |       | 2,296    |      |  |        | 2,407   |   |  |        | 598     |   |  |        | 208,204 |  
|                    |                                         | Liabilities subject to compromise                    |  |              | 91,989   |      |  |       | 97,335   |      |  |        | 242,870 |   |  |        |        |   |  |        |        |  
|                    |                                         | Preferred stock, net of offering
costs and discounts |  |              | 52,553   |      |  |       | 43,902   |      |  |        | 36,406  |   |  |        | 29,963  |   |  |        | 24,401  |  
|                    |                                         | Stockholders Deficiency                             |  |              | (114,760 | )    |  |       | (100,783 | )    |  |        | (97,605 | ) |  |        | (74,496 | ) |  |        | (51,300 | )



---

|(1) |  | Income (loss) from operation (i) excludes write-off by Fitzgeralds Reno
of $3.2 million inter-company debt from Nevada Club in 1999; (ii) the
Company recorded allowances of $0.2 million in 1998 against the book value
of Nevada Club assets held for sale to write such assets down to estimated
net realizable value, and recorded expenses of $0.1 million in 1998 for
the anticipated net settlement obligation relating to certain land lease
payments and property-related costs arising out of the Companys purchase
and subsequent sale of Harolds Club in 1995; (iii) includes $11.4 million
in gain on sale of assets to Majestic in 2001; (iv) includes the
write-down of assets of $14.8 million and $13.0 million at Fitzgeralds
Reno and Fitzgeralds Black Hawk, respectively in 2001; (v) management fees
from Cliff Castle for 1998; (vi) payments from the Turning Stone
settlement agreement for 1998; and (vii) non-recurring revenue of $8.0
million for termination of the Cliff Castle Management Agreement in 1998;
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | For the Ratio of Earnings to Fixed Charges, earnings are defined as
earnings before income taxes, interest on indebtedness, imputed interest
on capital lease obligations and the portion of rent expense deemed to
represent interest. Fixed charges consist of interest on indebtedness,
imputed interest on capital lease obligations, and the portion of rent
expense deemed to represent interest. The Fixed Charge Coverage Ratio was
1.8x for the year ended December 31, 2001; however, earnings were insufficient to cover
fixed charges by $5.3 million, $16.4 million, $18.0 million and $10.0
million for the years ended December 31, 2002, 2000, 1999 and 1998,
respectively.                                                                                                                                                                                                                                                                                                                                                  




|        |  |                                                                                      
|------- |  | -------------------------------------------------------------------------------------
|Item 7. |  | Managements Discussion and Analysis of Financial Condition and
Results of Operations

The Private Securities Litigation Reform Act of 1995 provides a safe harbor
for forward-looking statements. The following discussion should be read in
conjunction with, and is qualified in its entirety by, the Companys
Consolidated Financial Statements and the Notes thereto listed in Item 14(a).
The following discussion and other material in the report on Form 10-K contain
certain forward-looking statements. The forward-looking statements are
necessarily based upon a number of estimates and assumptions that, while

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considered reasonable, are inherently subject to significant business, economic
and competitive uncertainties and contingencies, many of which are beyond the
control of the Company, and upon assumptions with respect to future business
decisions which are subject to change. Risks to which the Company is subject
include, but are not necessarily limited to, its efforts to restructure its
indebtedness and capital structure, consummation of the Restructuring Agreement
and the Purchase Agreement, the uncertainties of the Bankruptcy Cases,
competition, high level of indebtedness, the need for additional financing,
development and construction risks, market fluctuations, gaming, liquor and
other regulatory matters, taxation, the availability and retention of key
management, environmental matters and other factors discussed in the Companys
other filings with the Securities and Exchange Commission. Accordingly, actual
results could differ materially from those contemplated by such forward-looking
statements.

Overview

Fitzgeralds Reno has been owned and operated by the Company or its affiliate
since 1985, and, Fitzgeralds Las Vegas and Fitzgeralds Tunica were owned and
operated by the Company or its affiliates since 1987 and 1994, respectively.
Between December 1994 and February 1995, a business combination was effected,
resulting in the existing single ownership structure for the companies
operating Fitzgeralds-brand casinos. In May 1995, the Company, under exclusive
management contracts, opened two properties outside of Nevada, Fitzgeralds
Black Hawk and Cliff Castle, and in December 1995, the Company acquired those
portions of Fitzgeralds Tunica (20%) and Fitzgeralds Inc. (2%) which it did not
own. In August 1997, the Company acquired the remaining 78% membership
interest in 101 Main not previously owned. In December 2001, the Company sold
substantially all of the assets of Fitzgeralds Las Vegas, Fitzgeralds Black
Hawk, and Fitzgeralds Tunica, as well as the Companys interest in The Fremont
Street Experience Limited Liability Company, to Majestic for $149.0 million in
cash, subject to certain holdbacks and adjustments, plus the assumption of
certain liabilities relating to the Assets.

Bankruptcy

On December 5, 2000, the Company commenced cases under Chapter 11 of the
Bankruptcy Code (collectively, the Bankruptcy Cases) in the United States
Bankruptcy Court for the Northern District of Nevada (the Bankruptcy Court).
The Bankruptcy Cases are jointly administered and coordinated under Case No.
BK-N-00-33467 GWZ. The Bankruptcy Cases were commenced in accordance with an
Agreement Regarding Pre-Negotiated Restructuring, dated as of December 1, 2000
(the Restructuring Agreement) with the holders (the Consenting Noteholders)
of a majority in interest of the Companys 12.25% Senior Secured Notes (the
Notes) issued under an indenture dated December 30, 1997 (the
Indenture). The Restructuring Agreement contemplates an expeditious and
orderly sale of all of the Companys operating assets and properties as going
concerns. The Company has been informed by Contrarian Capital
Advisers L.L.C. (Contrarian), one of the Consenting
Noteholders, that as of the date hereof substantially all of the
Notes held by the Consenting Noteholders are now held by Contrarian
and its affiliates.

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

Pursuant to the Restructuring Agreement and an order entered by the Bankruptcy
Court, the Company was required to distribute unrestricted cash (which includes
cash in net assets held for sale) in excess of $24.8 million to holders of its
Notes within 45 days after the end of each quarter. In May, August and
November 2001, the Company distributed $1.8 million, $7.7 million and $7.2
million, respectively, in Excess Cash to the Indenture Trustee to be applied to
accrued and unpaid interest and principal as

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provided in the Indenture. On
December 6, 2001, the Company sold substantially all of the assets and related
liabilities of its Fitzgeralds Las Vegas, Fitzgeralds Mississippi and
Fitzgeralds Black Hawk properties to Majestic. At that time, approximately
$133.3 million was distributed to the Indenture Trustee from the proceeds of
the sale. The Company and the Informal Committee subsequently established a
new threshold for cash reserves of $16.5 million, which was approved by the
Bankruptcy Court on November 27, 2002 and effective
November 1, 2002. Pursuant to that order the Company
distributed $6.2 million to the Indenture Trustee to be applied to accrued and
unpaid interest and principal. As part of the Restructuring Agreement, the
Consenting Noteholders and Indenture Trustee agreed to forbear from
exercising certain of their rights otherwise allowable under the Notes and the
Indenture.

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

In accordance with the Restructuring Agreement, an auction sale was to be
scheduled for no later than June 15, 2001 in the Bankruptcy Court with respect
to those operating assets and properties not sold pursuant to negotiated sales
agreements such as the purchase agreement with Majestic. With the consent of
the Consenting Noteholders, the auction sale was not conducted and the Company
and the Consenting Noteholders executed the Amended and Restated Restructuring Agreement. The Amended and Restated Restructuring Agreement provided for the Company to attempt to conduct
the auction sale of the one remaining operating property, Fitzgeralds Reno as
soon as possible.

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

On December 2, 2002, the Bankruptcy Court issued an Order approving the
adequacy of the disclosures in the Companys Disclosure Statement, setting
deadlines for balloting an opposing confirmation of the
Companys Initial Plan. The Confirmation hearing on the
Initial Plan was set for March 6, 2003 but was continued to
April 21, 2003. A significant number of Consenting Noteholders,
including several Consenting Noteholders managed by Contrarian,
voted to reject the Initial Plan. The Company believes that these votes were
in violation of the obligations of the Consenting Noteholders to vote
in favor of the Initial Plan and declared the Consenting Noteholders in
breach of the Amended and Restated Restructuring Agreement and filed with the Bankruptcy
Court a motion seeking to disallow the votes. The motion to disallow
the votes was set for hearing before the  Bankruptcy Court on
March 6, 2003.

Prior to the hearing on March 6,
2003, the Company and Contrarian agreed to the
Current Restructuring Agreement to provide, among other matters, (i) that
Fitzgeralds Reno would not be sold, but would be retained by the
Company and (ii) for an amendment to the Initial Plan (in the form of
a New Plan) to permit the
conversion of the indebtedness due the holders of the Notes into
equity of the successor to the Company. The Current Restructuring
Agreement, the New Plan and the Supplemental Disclosure Statement to
accompany Debtors Disclosure Statement were
filed with the Bankruptcy Court on March 20, 2003.

As a result of the sale of Fitzgeralds Las Vegas, Fitzgeralds Tunica and
Fitzgeralds Black Hawk on December 6, 2001, operating revenue and expenses for
these three properties will not reflect a full year of operations when
comparing results for the year 2001 to the year 2000. In addition, the
comparison for the year 2002 to the year 2001 will not be meaningful due to the
sale of the three properties mentioned above.

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Unless otherwise noted, the narrative discussion below is focused on the
results of the Companys Properties. Unless the context otherwise indicates,
the discussion below excludes Nevada Club, which was closed in December 1997
pending completion of its sale which occurred in June 1999, and in managements
opinion, is not material to the ongoing operations of the Company. Corporate
expense of $1.0 million per year was allocated to each of the Properties for
2001 and 2000. Such expenses are included in selling, general and
administrative expenses at each of the Operating Properties. In 2002, the
Company charged corporate expense of $0.05 million to Fitzgeralds Reno, and,
Fitzgeralds Reno incurred $0.4 million of net expense for services previously
provided by the Company. The remainder of the unallocated corporate expense is
included in the selling, general and administrative expenses of Other
Operations of the Properties. See Note 3 of Statement of Operations Data.

Results of Operations

The following table sets forth for the periods indicated certain Statement of
Operations Data and Other Data for the Companys Properties.

|                                       |                            |                  |     |                         |        |      |       |          |         |  |        |         |         | 
|-------------------------------------- | -------------------------- | ---------------- | --- | ----------------------- | ------ | ---- | ----- | -------- | ------- |  | ------ | ------- | ------- | 
|                                       |                            |                  |     | Year Ended December 31,
|                                       |                            |                  |     |                        
|Statement of Operations Data           |                            | 2002             |     | 2001                    |        | 2000
|                                       |                            |                  |     |                         |        |     
|                                       |                            |                  |     | (in thousands)         
|Net Operating Revenues:                |                            |                  |     |                         |        |      |       |          |         |  |        |        
|                                       | Fitzgeralds Las Vegas      |                  | $   |                        |        |      | $     | 49,440   |         |  | $      | 52,139  |        
|                                       | Fitzgeralds Tunica         |                  |     |                        |        |      |       | 76,713   |         |  |        | 75,062  |        
|                                       | Fitzgeralds Reno           |                  |     | 36,967                  |        |      |       | 38,333   |         |  |        | 40,241  |        
|                                       | Fitzgeralds Black Hawk     |                  |     |                        |        |      |       | 31,511   |         |  |        | 32,506  |        
|                                       | Other                      |                  |     | 34                      |        |      |       | 34       |         |  |        | 154     |        
|                                       |                            |                  |     |                         |        |      |       |          |         |  |        |        
|                                       |                            | Total            |     | $                       | 37,001 |      |       | $        | 196,031 |  |        | $       | 200,102 | 
|                                       |                            |                  |     |                         |        |      |       |          |         |  |        |        
|Income (Loss) from Operations (1):     |                            |                  |     |                         |        |      |       |          |         |  |        |        
|                                       | Fitzgeralds Las Vegas      |                  | $   | (223                    | )      |      | $     | (24,040  | )       |  | $      | (7      | )      
|                                       | Fitzgeralds Tunica         |                  |     | (212                    | )      |      |       | 41,972   |         |  |        | 9,018   |        
|                                       | Fitzgeralds Reno (2)       |                  |     | 1,909                   |        |      |       | (11,796  | )       |  |        | 2,716   |        
|                                       | Fitzgeralds Black Hawk (3) |                  |     | (486                    | )      |      |       | 7,224    |         |  |        | 6,385   |        
|                                       | Other (4)                  |                  |     | (5,105                  | )      |      |       | (3,317   | )       |  |        | (3,581  | )      
|                                       |                            |                  |     |                         |        |      |       |          |         |  |        |        
|                                       |                            | Total Properties |     |                         | (4,117 | )    |       |          | 10,043  |  |        |         | 14,531  | 
|                                       | Nevada Club                |                  |     | 3                       |        |      |       | (74      | )       |  |        | (50     | )      
|                                       |                            |                  |     |                         |        |      |       |          |         |  |        |        
|                                       |                            | Total            |     | $                       | (4,114 | )    |       | $        | 9,969   |  |        | $       | 14,481  | 
|                                       |                            |                  |     |                         |        |      |       |          |         |  |        |        
|Other Data                             |                            |                  |     |                         |        |      |       |          |         |  |        |        
|Net Cash Provided by (Used in)         |                            |                  |     |                         |        |      |       |          |         |  |        |        
|                                       | Operating Activities       |                  | $   | (7,989                  | )      |      | $     | (22,106  | )       |  | $      | 10,564  |        
|                                       | Investing Activities       |                  |     | 3,391                   |        |      |       | 135,039  |         |  |        | (13,647 | )      
|                                       | Financing Activities       |                  |     | (6,486                  | )      |      |       | (105,617 | )       |  |        | (739    | )      
|Depreciation and Amortization          |                            |                  | 30  |                         |        |      | 34    |          |         |  | 13,978 |        
|Capital Expenditures                   |                            |                  | 541 |                         |        |      | 1,815 |          |         |  | 13,508 |        
|Ratio of Earnings to Fixed Charges (5) |                            |                  |    |                         |        |      | 1.8x  |          |         |  |       |        



---

|(1) |  | Includes loss on sale of assets of $25.3 million for Fitzgeralds Las
Vegas and a gain on sale of assets of $24.1 million and $12.7 million for
Fitzgeralds Tunica and Fitzgeralds Black Hawk, respectively, to Majestic
in 2001. Such gains are included in Reorganization items.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Includes write down of property and equipment of $14.8 million in 2001.                                                                                                                                                                                                          

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|(3) |  | Includes write-down of assets of $13.0 million in 2001 at Fitzgeralds
Black Hawk.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(4) |  | Other includes corporate expenses not allocated to the Operating
Properties for all periods presented, which includes $3.2 million of
pre-petition professional fees and expenses incurred with the Companys
restructuring for 2000, and approximately $1.8 million, $3.5 million and
$0.1 million of post-petition professional fees and expenses, net of
interest income included as reorganization items in 2002, 2001 and 2000,
respectively.                                                                                                                                                                                              
|   
|(5) |  | For the Ratio of Earnings to Fixed Charges, earnings are defined as
earnings before income taxes, interest on indebtedness, imputed interest
on capital lease obligations and the portion of rent expense deemed to
represent interest. Fixed charges consist of interest on indebtedness,
imputed interest on capital lease obligations and the portion of rent
expense deemed to represent interest. The Fixed Charge Coverage Ratio was
1.8x for the year ended December 31, 2001; however, earnings were
insufficient to cover fixed charges by $5.3 million and $16.4 million for
the years ended December 31, 2002 and 2000, respectively.

Fiscal 2002 Comparison to Fiscal 2001

Operating Revenues

Total revenues for the Properties were $42.5 million and net operating revenues
were $37.0 million for 2002, representing decreases of 81.6% and 81.1%,
respectively, over total revenues for the Properties of $231.2 million and net
operating revenues of $196.0 million for 2001. The decreases were
substantially all the result of the sale of Fitzgeralds Las Vegas, Fitzgeralds
Tunica and Fitzgeralds Black Hawk to Majestic on December 6, 2001. Total
operating revenue for Fitzgeralds Reno decreased 2.4% to $42.5 million for 2002
from $43.5 million for the 2001.

The Companys business can be separated into four operating departments:
casino, food and beverage, rooms (except for Fitzgeralds Black Hawk) and other.
Casino revenues (of which approximately 75.6% and 86.9% were derived from slot
machine revenues for 2002 and 2001, respectively) decreased 83.2% to $30.7
million for 2002 from the $182.1 million recorded for 2001. Substantially all
of the decrease was a result of the sale to Majestic. Casino revenues at
Fitzgeralds Reno decreased to $30.7 million for 2002 from $31.4 million for
2001.

Room revenues (11.9% and 8.9% of total revenues for 2002 and 2001,
respectively) decreased 75.2% from $20.5 million in 2001 to $5.1 million in
2002. Substantially all of the decrease was a result of the sale to Majestic.
Fitzgeralds Reno room revenues decreased 6.1%, from $5.4 million in 2001 to
$5.1 million in 2002, due to a combination of decrease in the average occupancy
rate to 83.8% in 2002 from 87.6% in 2001 and a 2.8% decrease in the average
daily rate.

Food and beverage revenues (14.1% and 10.5% of total revenues for 2002 and
2001, respectively) decreased 75.3%, from $24.2 million in 2001 to $6.0 million
in 2002. Substantially all of the decrease was a result of the sale to
Majestic. Food and beverage revenue at Fitzgeralds Reno increased 2.6% to
$6.0 million for 2002 from $5.8 million for 2001.

Other revenues decreased from $4.4 million in 2001 to $0.8 million in 2002, a
decrease of 81.8% for 2002. Substantially all of the decrease was a result of
the sale to Majestic.

Promotional allowances showed a net decrease of 84.3% to $5.5 million for 2002
from $35.2 million for 2001. Substantially all of the decrease was a result of
the sale to Majestic. Promotional allowances for Fitzgeralds Reno increased
6.5% to $5.5 million for 2002 from $5.2 million for 2001.

21



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##### Table of Contents



Operating Costs and Expenses

Total operating costs and expenses for the Properties decreased 77.9%, to $41.1
million for 2002 from $186.0 million for 2001. Substantially all of the
decrease was a result of the sale to Majestic. Total operating expenses for
Fitzgeralds Reno decreased 30.1% to $35.1 million for 2002 from $50.1 million
for 2001. The decrease at Fitzgeralds Reno was primarily due to the write-down
of assets of $14.8 million in 2001.

Casino expenses were $15.8 million for 2002, an 81.6% decrease from $85.7
million for 2001. Food and beverage expenses decreased 72.3% to $4.0 million
for 2002 from $14.4 million for 2001. Room expenses decreased 85.0% to $1.8
million for 2002 from $11.7 million in 2001. Selling, general and
administrative expenses decreased 66.7% to $17.4 million for 2002 from $52.3
million for 2001. Such expenses also include professional fees and expenses
paid by the Company for the financial and legal advisors to the informal
committee (the Committee) representing holders of a majority in interest of
the Notes. Substantially all of the decrease was a result of the sale to
Majestic.

Personnel expenses decreased 77.1%, to $17.2 million for 2002 from $75.0
million for 2001. Substantially all of the decrease was a result of the sale
to Majestic. Such expenses are included in the operating departmental expense
to which they relate on the consolidated statements of operations. Personnel
expenses at Fitzgeralds Reno increased 1.7%, to $17.2 million for 2002 from
$16.9 million for 2001.

Marketing expenses, which include advertising, promotional material and special
events, decreased 70.9%, to $3.9 million for 2002 from $13.4 million for 2001.
Substantially all of the decrease was a result of the sale to
Majestic. The
Companys strategy is to continue to adjust marketing expense levels as needed
to respond to competition. Such expenses are included in selling, general and
administrative expenses on the consolidated statements of operations.
Marketing expense at Fitzgeralds Reno increased 1.7%, to $3.9 million for 2002
from $3.8 million for 2001.

Depreciation and amortization expense decreased 10.5% to $0.030 million for
2002 from $0.034 million for 2001.

Income from Operations

As a result of the foregoing, income from operations for the Properties
decreased from $10.0 million for 2001 to a loss from operations of $4.1 million
for 2002. Income from operations for Fitzgeralds Reno increased to $1.9
million for 2002, from a loss from operations of $11.8 million for 2001. The
increase for Fitzgeralds Reno is due to the write down of assets of $14.8
million in 2001.

Net Interest Expense

Interest expense (net of interest income) decreased 73.3% to $1.2 million for
2002 from $4.5 million for 2001. Section 506(b) of the Bankruptcy Code permits
the allowance of interest on an allowed secured claim secured by property, the
value of which is greater than the amount of the claim. Inasmuch as the
parties to the Restructuring Agreement have concluded that the fair market
value of the collateral securing the Notes is less than the outstanding
principal of the Notes, concurrently with the filing of the Bankruptcy Cases on
December 5, 2000 the Company ceased accruing interest on the Notes.

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Net Income

For the reasons cited above, net income for the Properties decreased from $4.2
million for 2001 to a net loss of $5.3 million in 2002. Fitzgeralds Renos net
income increased to $1.7 million for 2002 from a net loss of $15.1 million for
2001 for the reasons discussed above.

Fiscal 2001 Comparison to Fiscal 2000

Operating Revenues

Total revenues for the Properties were $231.2 and net operating revenues was
$196.0 for 2001, representing decreases of 1.3% and 2.0%, respectively, over
total revenues for the Properties of $234.1 million and net operating revenues
of $200.1 million for 2000. Such decreases were largely the result of the sale
of Fitzgeralds Las Vegas, Fitzgeralds Tunica and Fitzgeralds Black Hawk to
Majestic on December 6, 2001.

The Companys business can be separated into four operating departments:
casino, food and beverage, rooms (except for Fitzgeralds Black Hawk) and other.
Casino revenues (of which approximately 86.9% and 85.1% are derived from slot
machine revenues for 2001 and 2000, respectively) increased 0.2% to $182.1
million for 2001 from the $181.7 million recorded for 2000.

Room revenues (at 8.9% and 9.4% of total revenues for 2001 and 2000,
respectively) decreased 7.1% from $22.1 million in 2000 to $20.5 million in
2001. Fitzgeralds Las Vegas room revenues decreased 11.7% from $8.5 million in
2000 to $7.5 million in 2001, as its average daily rate decreased 7.4%, and the
average occupancy rate decreased to 91.9% in 2001 from 92.1% in 2000.
Fitzgeralds Reno room revenues decreased 0.9%, from $5.5 million in 2000 to
$5.4 million in 2001, as a decrease in the average occupancy rate to 87.6% in
2001 from 88.9% in 2000 was offset by a 0.5% increase in the average daily
rate. Fitzgeralds Tunica room revenues decreased 6.5%, from $8.1 million for
2000 to $7.6 million in 2001, as an increase in the average occupancy rate to
94.5% in 2001 from 92.5% in 2000 was offset by a 2.2% decrease in the average
daily rate.

Food and beverage revenues (at 10.5% and 11.0% of total revenues for 2001 and
2000, respectively) decreased 6.3%, from $25.8 million in 2000 to $24.2 million
in 2001 primarily due to the sale of assets to Majestic.

Other revenues decreased 3.3% from $4.6 million in 2000 to $4.4 million in
2001.

Promotional allowances showed a net increase of 3.3% to $35.2 million for 2001
from $34.0 million for 2000, reflecting the increased level of competition in
all four markets.

Operating Costs and Expenses

Total operating costs and expenses for the Properties increased 0.2%, to $186.0
million for 2001 from $185.6 million for 2000. After excluding the $11.4
million gain on sale of asset to Majestic and $14.8 million and $13.0 million
for the write-down of Fitzgerald Reno and Fitzgeralds Black Hawk assets,
operating costs and expenses decreased 8.6% to $169.6 million. Such decreases
were largely the result of the sale of Fitzgeralds Las Vegas, Fitzgeralds
Tunica and Fitzgeralds Black Hawk to Majestic on December 6, 2001.

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Casino expenses were $85.7 million for 2001, a 1.2% increase from $84.7 million
for 2000. Food and beverage expenses decreased 6.3% to $14.4 million for 2001
from $15.4 million for 2000. Room expenses decreased 8.2% to $11.7 million for
2001 from $12.8 million in 2000. Selling, general and administrative expenses
decreased 7.4% to $52.2 million for 2001 from $56.4 million for 2000, which
includes $3.2 million for 2000 of pre-petition professional fees and expenses
incurred in conjunction with the ongoing development, negotiation and
implementation of the Companys restructuring. Such expenses also include
professional fees and expenses paid by the Company for the financial and legal
advisors to the informal committee (the Committee) representing holders of a
majority in interest of the Notes.

Personnel expenses decreased 9.1%, to $75.0 million for 2001 from $82.5 million
for 2000, primarily as a result of the December 6, 2001 sale. Such expenses
are included in the operating departmental expense to which they relate on the
consolidated statements of operations.

Marketing expenses at Fitzgeralds Reno, which include advertising, promotional
material and special events, decreased 11.1%, to $13.4 million for 2001 from
$15.1 million for 2000. The Companys strategy is to utilize its expanded and
renovated facilities as additional marketing elements and to continue to adjust
marketing expense levels as needed to respond to
competition. Such expenses are included in selling, general and administrative
expenses on the consolidated statements of operations.

Depreciation and amortization expense decreased 99.8% to $0.034 million for
2001 from $14.0 million for 2000, due to the discontinuation of recording
depreciation and amortization expense for property and equipment included in
net assets held for sale subsequent to filing the Bankruptcy Cases in December
2000.

Income from Operations

As a result of the foregoing, income from operations for the Properties
decreased from $14.5 million for 2000 to $10.0 million for 2001. The decrease
in results is primarily due to the $14.8 million and $13.0 million write-down
in assets of Fitzgeralds Reno and Fitzgeralds Black Hawk, respectively, offset
by the $11.4 million gain on sale of assets to Majestic and a $13.9 million
decrease in depreciation and amortization expense resulting from the
discontinuation of recording substantially all depreciation and amortization
expense for assets held for sale in 2001.

Net Interest Expense

Interest expense (net of interest income) decreased 85.3% to $4.5 million for
2001 from $30.8 million for 2000, due to the discontinuation of accruing
interest on the Notes on December 5, 2000 with the commencement of the
Bankruptcy Cases.

Net Income

Net income for the Properties increased to $4.2 million for 2001 compared to a
net loss of $16.4 million in 2000.

Liquidity and Capital Resources

At December 31, 2002, the Company had unrestricted cash of $14.5 million
compared to $25.6 million at December 31, 2001. The Companys net cash used in
operating activities during 2002 was $8.0 million. Net cash provided by
investing activities was $3.4 million for 2002, compared to $135.0 million for

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2001. In 2001 net cash provided by investing activities included proceeds from
the sale of assets to Majestic on December 6, 2001. Net cash used in financing
activities was $6.5 million for 2002 compared to $105.6 million for 2001. In
2001, with the proceeds from the sale of the assets, the Company repaid a
portion of the Notes in accordance with the Restructuring Agreement.

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

The Restructuring Agreement provided a vehicle for liquidating the assets of
the Company in the Bankruptcy Court through Chapter 11 of the Bankruptcy Code.
Upon execution of the Restructuring Agreement and before commencement of the
Bankruptcy Cases, the Company distributed $13.0 million in Excess Cash (as that
term is defined in the Restructuring Agreement) to the trustee under the
Indenture (the Indenture Trustee) to be applied to unpaid and accrued
Indenture Trustees fees and expenses
incurred and as partial payment of accrued and unpaid interest and principal as
provided in the Indenture. On December 5, 2000, the Company commenced the
Bankruptcy Cases in the Bankruptcy Court. For further information concerning
the Bankruptcy Cases and related matters, see Item 1. Business  Bankruptcy 
Restructuring Agreement and Purchase Agreement.

Pursuant to the Restructuring Agreement and an order entered by the Bankruptcy
Court, the Company was required to distribute unrestricted cash (which includes
cash in net assets held for sale) in excess of $24.8 million to holders of its
Notes within 45 days after the end of each quarter until the closing of the
sale to Majestic. In May, August and November 2001, the Company distributed
$1.8 million, $7.7 million and $7.2 million, respectively, in Excess Cash to
the Indenture Trustee to be applied to accrued and unpaid interest and
principal as provided in the Indenture. The Company and the Informal Committee
subsequently established a new threshold for cash reserves of $16.5 million,
which was approved by the Bankruptcy Court on November 27, 2002
and effective November 1, 2002. Pursuant to
that order, the Company distributed $6.2 million to the Indenture Trustee to be
applied to accrued and unpaid interest and principal. As part of the
Restructuring Agreement, the Consenting Noteholders and Indenture Trustee agreed to forbear from exercising certain of their rights otherwise allowable
under the Notes and the Indenture.

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

Ratio of Earnings to Fixed Charges

The ratio of earnings to fixed charges measures the extent by which earnings,
as defined, exceed certain fixed charges. Earnings are defined as earnings
before income taxes, interest on indebtedness, imputed

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interest on capital lease obligations and the portion of rent expense deemed to represent interest.
Fixed charges consist of interest on indebtedness, imputed interest on capital
lease obligations, and the portion of rent expense deemed to represent
interest. The Fixed Charge Coverage Ratio was 1.8x for the year ended December
31, 2001. However, earnings were insufficient to cover fixed charges by $5.3
million and $16.4 million for the years ended December 31, 2002 and 2000,
respectively.

Business Seasonality

The gaming operations of the Company are seasonal and could be significant. At
Fitzgeralds Reno business levels are typically weaker from Thanksgiving through
the end of the winter and typically stronger from mid-June to mid-November. In
addition, because of its proximity to a mountainous region, Reno is subject to
severe weather, particularly during the winter months, that can and often does
have an adverse impact on business.

Critical Accounting Policies and Estimates

A summary of our significant accounting policies can be found in Note 3 of the
Notes to Consolidated Financial Statements. Our preparation of financial
statements in conformity with accounting principles generally accepted in the
United States of America requires us to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenue and expenses during the reporting period.
Significant among those estimates are the useful lives and potential impairment
of long-term assets, such as investments, buildings, equipment and goodwill,
the adequacy of our allowance for uncollectible receivables, and the amount of
litigation and self insurance reserves. These estimated amounts are based on
our best judgments using both historical information and known trends in our
company and in our industry. Because of the uncertainty inherent in any
estimate, it is likely that the actual results will differ from the initial
estimates, and the differences could be material.

Recently Issued Accounting Pronouncements

In April 2002, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 145 (SFAS 145), Rescission of
FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and
Technical Corrections.The most significant provisions of this statement relate
to the rescission of Statement No. 4, Reporting Gains and Losses from
Extinguishment of Debtand it also amends other existing authoritative
pronouncements to make various technical corrections, clarify meanings, or
describe their applicability under changed conditions. Under this new
statement, any gain or loss on extinguishment of debt that was classified as an
extraordinary item in prior periods that does not meet certain defined criteria
must be reclassified. The provisions of this Statement, related to the
rescission of Statement 4, should be applied in fiscal years beginning after
May 15, 2002. Generally, SFAS 145 is effective for the Companys fiscal year
2003. Adoption of this statement did not have a material impact on the
Companys financial condition or results of operation.

In June 2002, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 146 (SFAS 146), Accounting
for Costs Associated with Exit or Disposal Activities.This statement address
financial accounting and reporting for costs associated with exit or disposal
activities and supercedes EITF No. 94-3 Liability Recognition for Certain
Employee Termination Benefits and Other Costs to Exit an Activity (including
Certain Costs Incurred in a Restructuring).The statement requires that a
liability for a cost associated with an exit or disposal activity is recognized
when the liability is incurred. A fundamental conclusion reached by the FASB in
SFAS 146 is than an entitys commitment to a plan, by itself, does not create a
present obligation to

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others that meets the definition of a liability. This
statement also establishes that fair value is the objective for initial
measurement of the liability. The provisions of this statement are effective
for exit or disposal activities that are initiated after December 31, 2002 with
early application encouraged. Adoption of this statement did not have a
material impact on the Companys financial condition or results of operation.

In November 2002, the Financial Accounting Standards Board (FASB) issued FASB
Interpretation No 45 (FIN 45), Guarantors Accounting and Disclosure
Requirements for Guarantees, including indirect Guarantees of Indebtedness of
Others.FIN 45 expands the information disclosures required by guarantors for
obligations under certain types of guarantees. It also requires initial
recognition at fair value of a liability for such guarantees. The initial
recognition and initial measurement provisions of this Interpretation are
applicable on a prospective basis to guarantees issued or modified after
December 31, 2002, irrespective of the guarantors fiscal year-end. The
disclosure requirements in this Interpretation are effective for financial
statements of interim or annual periods ending after December 15, 2002. The
Company does not anticipate that the adoption of FIN No. 45 will have a
material impact on the consolidated financial statements.

In December 2002, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 148 (SFAS 148), Accounting
for Stock-Based Compensation  Transition and Disclosure, an amendment of FASB
Statement No. 123to provide alternative methods of transition for a voluntary
change to the fair value based method of accounting for stock-based employee
compensation. In addition, SFAS No 148 amends the disclosure requirements of
SFAS No. 123 to require prominent disclosures in both annual and interim
financial statements about the method of accounting for stock-based employee
compensation and the effect of the method used on reported results. The
amendments to the transition and disclosure provisions are effective for
financial statements for fiscal years ending after December 15, 2002 with early
adoption encouraged. The Company does not anticipate that the adoption of SFAS
No. 148 will have a material impact on the consolidated financial statements.




|         |  |                                                           
|-------- |  | ----------------------------------------------------------
|Item 7A. |  | Quantitative and Qualitative Disclosures About Market Risk

The Company is exposed to changes in interest rates primarily as a result of
its borrowing activities and third party financing. These sources of credit,
along with cash flow from operations, are used to maintain liquidity and fund
business operations. The Company typically replaces borrowings under its third
party vendor financing, as necessary, with shorter termed variable rate
financing generally secured by the assets being acquired. The nature and
amount of the Companys debt may vary as a result of future business
requirements, market conditions and other factors. The definitive extent of
the Companys interest rate risk is not quantifiable or predictable because of
the variability of future interest rates and business financing requirements,
but the Company does not believe such risk is material. The Company does not
currently use derivative instruments to adjust the Companys interest rate risk
profile.

The fair market value of the Companys fixed debt obligations was $51.9 million
at December 31, 2001. Due to the Companys bankruptcy filing, subsequent sale
of a substantial portion of its assets, interim payments on the aggregate
balance of accrued interest and principal on the Notes, as well as delays
encountered in selling the Companys remaining operating casino, the Company
believes it is no longer possible to accurately determine the fair market value
of its fixed debt obligations at December 31, 2002. The majority of the
Companys fixed debt obligations are comprised of the Companys Notes.

The Company does not utilize financial instruments for trading or other
speculative purposes, nor does it utilize leveraged financial instruments. On
the basis of the fair value of the Companys market sensitive instruments at
December 31, 2002, the Company does not consider the potential near-term losses
in

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future earnings, fair values and cash flows from reasonably possible
near-term changes in interest rates to be material.




|        |  |                                            
|------- |  | -------------------------------------------
|Item 8. |  | Financial Statements and Supplementary Data

The information required by this item is listed under Item 15 of Part IV of
this Report on Form 10-K.




|        |  |                                                                                     
|------- |  | ------------------------------------------------------------------------------------
|Item 9. |  | Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure

None

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PART III




|         |  |                                                                      
|-------- |  | ---------------------------------------------------------------------
|Item 10. |  | Directors, Executive Officers and Significant Employees of Registrant

The following tables set forth certain information with respect to directors,
executive officers and significant employees of the Company as of December 31,
2002:

Directors and Executive Officers

|                     |  |     |    |                  |  |                                                 |  | 
|-------------------- |  | --- | -- | ---------------- |  | ----------------------------------------------- |  | 
|Name                 |  | Age |    | Position(s) Held
|                     |  |     |    |                 
|Philip D. Griffith   |  |     | 57 |                  |  | Chairman, President and Chief Executive Officer
|Philip P. Hannifin   |  |     | 68 |                  |  | Director                                       
|Patricia W. Becker   |  |     | 51 |                  |  | Director                                       
|Max L. Page          |  |     | 53 |                  |  | Director; Executive Vice President and a       
|                     |  |     |    |                  |  | director of Fitzgeralds Reno, Inc., and        
|                     |  |     |    |                  |  | General Manager of Fitzgeralds Reno            
|Michael E. McPherson |  |     | 51 |                  |  | Executive Vice President, Chief Financial      
|                     |  |     |    |                  |  | Officer, Treasurer and Secretary               
|Paul Manske          |  |     | 62 |                  |  | Executive Vice President of Marketing          

Philip D. Griffith, one of the Companys founders, has been President, Chief
Executive Officer and a director of the Company and certain of its subsidiary
companies since its inception in 1984 and has been Chairman of the Board since
August 1997. Prior to his involvement with the Fitzgeralds group, Mr. Griffith
was active in the gaming industry holding a variety of positions, including
Chief Financial Officer and later President of Harolds Club in Reno from 1973
to 1984 and President of the Sands Hotel & Casino in Las Vegas with the Howard
Hughes organization from 1982 to 1984. From 1968 to 1973, Mr. Griffith was a
Certified Public Accountant with the St. Louis, Missouri and Las Vegas offices
of Deloitte Haskins & Sells. He is also a director of Federal Liaison
Services, Inc.

Philip P. Hannifinserved as Executive Vice President since joining the Company
in 1991 until resigning on December 31, 2000 and was a director of certain
subsidiaries of the Company from 1986 to 1995. He has been active in the
gaming industry holding a variety of positions, including a director of Riviera
Holdings Corp. from 1993 to 1998, Executive Vice President and a director of
MGM Grand, Inc. from 1987 to 1991, President of Harrahs West from 1984 to 1986
and Executive Vice President and a director of Summa Corporation from 1977 to
1984. He is a past Chairman of the Nevada State Gaming Control Board. He
holds a degree in psychology from the University of Nevada at Reno. Mr.
Hannifin has been a director of the Company since April 1999. He is Chairman
of the Audit Committee of the Board of Directors and a member of the
Compensation Committee of the Board of Directors.

Patricia W. Becker. Ms. Becker has been Senior Vice President of Corporate
Affairs & Legal of Aladdin Gaming LLC since May 1998. From October 1993 to
January 1995, she served as Chief of Staff to Nevada Governor Bob Miller. From
September 1984 to October 1993, Ms. Becker was Senior Vice President, General
Counsel and Secretary for Harrahs Casino Hotels, where she was responsible for
all legal affairs. She was also a member of the senior strategic management
group. From January 1983 to September 1984, Ms. Becker was a member of the
Nevada State Gaming Control Board and from July 1979 to January 1983, she was a
Deputy and Chief Deputy Attorney General assigned to the Nevada Gaming
Division. She is President of Patricia Becker & Associates which provides
consulting services to the gaming industry, a Vice Chair for the Gaming Law
Section of the American Bar Association, past President of the International
Association of Gaming Attorneys and a past president of the Nevada Trial

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Lawyers Association. Ms. Becker has been a director of the Company since
December 1995. She is Chairperson of the Compensation Committee of the Board
of Directors and a member of the Audit Committee of the Board of Directors.

Max L. Page, one of the Companys founders, has served as Executive Vice
President and a director of certain subsidiaries of the Company since September
1986 and as General Manager of Fitzgeralds Reno since November 1994. He has a
B.A. in political science and a Masters in public administration from Brigham
Young University. Mr. Page has been a director of the Company since January
1998.

Michael E. McPhersonhas been Executive Vice President since July 1999,
Secretary since September 1997 and Chief Financial Officer and Treasurer since
August 1997. Prior thereto he was Senior Vice President. He has served in
various executive and financial positions since joining the Company in March
1985, including Senior Vice President of Operations from September 1995 to July
1997, Vice President of Finance from November 1994 to September 1995, Vice
President and Treasurer for certain subsidiaries of the Company and Director of
Finance for Fitzgeralds Reno. Mr. McPherson has a degree in business
administration from the University of Nevada at Reno and is an associate member
of the Nevada Society of Certified Public Accountants.

Paul H. Manske, one of the Companys founders, has been Executive Vice
President of Marketing since September 1999. Prior thereto he was Senior Vice
President of Marketing and Executive Vice President of certain subsidiaries of
the Company. He was Vice President of Marketing for Harolds Club and the Sands
Hotel & Casino with the Howard Hughes organization in Las Vegas from 1978 to
1984 and a marketing executive with the Ford Motor Company from 1964 to 1978.
Mr. Manske has a degree in business administration from Jacksonville
University.

Board of Directors

Directors are elected at the annual meeting of stockholders and each director
is elected to serve until a successor is elected and qualified. The Company
has not held an annual meeting of stockholders since August 1998. The number
of directors may not be less than three or more than nine. In cases where all
of the common shares of the Company are owned beneficially or of record by
either one or two stockholders, the number may be less than three but not less
than the number of stockholders. The current Board of Directors consists of
four directors.

The Board of Directors has two standing committees: Audit and Compensation.

The Audit Committee reviews reports of the Companys independent certified
public accountants and makes recommendations to the full Board on matters
concerning the Companys audits and the selection of independent certified
public accountants. The Audit Committee does not have a formal written Audit
Committee charter. The members of the Audit Committee are Patricia W. Becker
and Philip P. Hannifin, as Chairman. Although the Companys Common Stock is
not listed on any stock exchange or quoted on NASDAQ, only Ms. Becker would be
deemed independent under current NASDAQ rules.

The Audit Committee has reviewed and discussed the audited financial statements
with management. The Audit Committee has discussed with the independent
certified public accountants the matters required to be discussed by SAS 61
(Codification of Statements on Auditing Standards, AU380). The Audit Committee
has reviewed the written disclosures and the letter from the independent
certified public accountants required by Independence Standards Board Standard
No. 1 (Independence Standards Board Standard No. 1, Independence Discussions
with Audit Committees), and has discussed with the independent certified public
accountants the independent certified public accountants independence.

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Based on the review and discussions referred to above, the Audit Committee
recommended to the Board of Directors that the audited financial statements be
included in the Companys Annual Report on Form 10-K for the year ended
December 31, 2002. The Companys unaudited financial statements included in
Forms 10-Q subsequent to the date of this Annual Report on Form 10-K will be
reviewed by the Companys independent certified public accountants in
accordance with the procedure set forth in Statement on Accounting Standards
No. 71.

The Compensation Committee reviews and makes recommendations to the Board of
Directors with respect to salaries, bonuses and other compensation of the
Companys executive officers. The members of the Compensation Committee are
Philip P. Hannifin and Patricia W. Becker, as Chairperson.

Directors who are also employees of the Company do not receive any compensation
for their services as directors. During 2002, non-employee directors were paid
fees of $40,000 per year and $1,000 per Board meeting attended in person or
telephonically. Commencing February 1, 2003 non-employee directors will be
paid fees of $20,000 per year. Ms. Becker is also chairperson of the Gaming
Compliance Committee (a non-Board committee) for which she was paid an
additional fee of $53,000 per year and $1,000 per Committee meeting attended in
person or telephonically in 2002. Mr. Hannifin is also chairman of the Audit
Committee for which he was paid an additional fee of $27,500 per year and
$1,000 per Committee meeting attended in Person or telephonically. Ms. Becker
and Mr. Hannifin also participate in all health insurance plans generally
available to the Companys employees. The Company reimburses each director for
reasonable out-of-pocket expenses incurred in his or her capacity as a member
of the Board of Directors. No payments are made for actions taken in writing.
Each director attended all of the meetings of the Board and the committees on
which he or she served during the fiscal year ended December 31, 2002.

In accordance with requirements of the Sarbanes-Oxley Act of 2002 and the
Regulations adopted pursuant thereto, on December 11, 2002, the Board of
Directors established a Disclosure Committee and approved and adopted the
Disclosure Committee Charter, Disclosure Policy and Standards of Business
Conduct and Ethics. The Disclosure Committee membership is comprised of
Philip D. Griffith, President and Chief Executive Officer, Michael E.
McPherson, Executive Vice President and Chief Financial Officer, and Phillip P.
Hannifin, Chairperson of the Audit Committee of the Company.

The Company has no nominating committee or other committee performing similar
functions.

Non-Board Committees

The Executive Committee, comprised of Michael E. McPherson, Max L. Page and
Philip D. Griffith, as Chairman, provides a forum for interaction and
discussion among its senior executives.

The Gaming Compliance Committee, comprised of Kathleen Bryant, Philip P.
Hannifin, Michael E. McPherson and Patricia W. Becker, as Chairperson,
establishes procedures for and monitors compliance with gaming regulations.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934 requires officers and
directors of the Company and persons who own more than ten percent of a
registered class of the Companys equity securities (collectively, Insiders)
to file initial reports of ownership and changes in ownership with the
Securities and Exchange Commission (the Commission) and to furnish the
Company with copies of all forms filed.

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To the Companys knowledge, based solely on its review of the copies of such
forms furnished to the Company and written representation that no other reports
were required, during the past fiscal year all Section 16(a) filing
requirements applicable to the Companys Insiders were met.




|         |  |                       
|-------- |  | ----------------------
|Item 11. |  | Executive Compensation

The following table sets forth a summary of the compensation paid by the
Company in the three fiscal years ended December 31, 2002, 2001 and 2000 to the
Companys Chief Executive Officer and each of its other most highly compensated
executive officers (collectively the named executive officers). The named
executive officers include: (i) each person who served as Chief Executive
Officer during 2002; (ii) each person who (a) served as an executive officer at
December 31, 2002, (b) was among the four most highly paid executive officers
of the Company, not including the Chief Executive Officer, during 2002; and (c)
received over $100,000 in compensation in 2002; (iii) up to two persons who
would be included under clause (ii) above had they served as an executive
officer at December 31, 2002; and (iv) certain persons who served as executive
officers of a subsidiary of the Company. Titles refer to the Company unless
otherwise indicated.

Summary Compensation Table

|                     |                                         |      |                        |            |              |              |         |         |  |             |   |         |              |  |            |   |              |  |           |   |  |  |         |           | 
|-------------------- | --------------------------------------- | ---- | ---------------------- | ---------- | ------------ | ------------ | ------- | ------- |  | ----------- | - | ------- | ------------ |  | ---------- | - | ------------ |  | --------- | - |  |  | ------- | --------- | 
|                     |                                         |      |                        |            |              |              |         |         |  |             |   |         |              |  |            |   |              |  | Long-Term |   |  |  |        
|                     |                                         |      | Annual Compensation(1) |            | Compensation |              |         |         | 
|                     |                                         |      |                        |            |              |              |         |         | 
|                     |                                         |      |                        |            |              |              |         |         |  |             |   |         |              |  | Other      |   |              |  |           |   |  |  |        
|                     |                                         |      |                        |            |              |              |         |         |  |             |   |         |              |  | Annual     |   | Securities   |  | All Other
|                     |                                         |      | Fiscal                 |            |              |              |         |         |  |             |   |         | Compensation |  | Underlying |   | Compensation
|Name & Position      |                                         | Year |                        | Salary ($) |              | Bonus ($)(2) |         | ($)(3)  |  | Options (#) |   | ($)(4) 
|                     |                                         |      |                        |            |              |              |         |         |  |             |   |        
|Philip D. Griffith   |                                         |      | 2002                   |            |              |              | 671,556 |         |  |             |  |         |              |  |           |   |              |  |          |   |  |  | 594,828 |          
|                     | Chairman, President &                   |      |                        | 2001       |              |              |         | 604,546 |  |             |   | 273,000 |              |  |            |  |              |  |           |  |  |  |         | 3,789,495 | 
|                     | Chief Executive Officer                 |      |                        | 2000       |              |              |         | 576,715 |  |             |   | 320,000 |              |  |            |  |              |  |           |  |  |  |         | 180,723   | 
|Michael E. McPherson |                                         |      | 2002                   |            |              |              | 281,100 |         |  |             |  |         |              |  |           |   |              |  |          |   |  |  | 87,478  |          
|                     | Executive Vice President,               |      |                        | 2001       |              |              |         | 268,440 |  |             |   | 95,000  |              |  |            |  |              |  |           |  |  |  |         | 798,364   | 
|                     | Chief Financial Officer,                |      |                        | 2000       |              |              |         | 255,673 |  |             |   | 105,000 |              |  |            |  |              |  |           |  |  |  |         | 13,942    | 
|                     | Treasurer & Secretary                   |      |                        |            |              |              |         |         |  |             |   |         |              |  |            |   |              |  |           |   |  |  |         |           | 
|Paul H. Manske       |                                         |      | 2002                   |            |              |              | 275,700 |         |  |             |  |         |              |  |           |   |              |  |          |   |  |  | 155,178 |          
|                     | Executive Vice President                |      |                        | 2001       |              |              |         | 266,308 |  |             |   | 95,000  |              |  |            |  |              |  |           |  |  |  |         | 811,516   | 
|                     | Marketing                               |      |                        | 2000       |              |              |         | 254,478 |  |             |   | 105,000 |              |  |            |  |              |  |           |  |  |  |         | 25,285    | 
|Max L Page           |                                         |      | 2002                   |            |              |              | 275,700 |         |  |             |  |         |              |  |           |   |              |  |          |   |  |  | 95,344  |          
|                     | Director; Executive Vice                |      |                        | 2001       |              |              |         | 266,562 |  |             |   | 80,000  |              |  |            |  |              |  |           |  |  |  |         | 793,469   | 
|                     | President of FRI & General              |      |                        | 2000       |              |              |         | 253,846 |  |             |   | 95,000  |              |  |            |  |              |  |           |  |  |  |         | 16,472    | 
|                     | Manager of Fitzgeralds
Reno             |      |                        |            |              |              |         |         |  |             |   |         |              |  |            |   |              |  |           |   |  |  |         |           | 
|Domenic Mezzetta(5)  |                                         |      | 2002                   |            |              |              |        |         |  |             |  |         |              |  |           |   |              |  |          |   |  |  |        |          
|                     | Vice President of FMI                   |      |                        | 2001       |              |              |         | 203,735 |  |             |   |        |              |  |            |  |              |  |           |  |  |  |         | 8,960     | 
|                     | & General Manager of
Fitzgeralds Tunica |      |                        | 2000       |              |              |         | 205,255 |  |             |   | 24,700  |              |  |            |  |              |  |           |  |  |  |         | 5,783     | 



---

|(1) |  | Amounts shown include cash compensation earned for the periods reported
whether paid or accrued in such periods.                                                              
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Amounts shown in 2001 represent bonus compensation earned in 2001 and not
calculable or paid at the time of filing the Form 10-K for the fiscal year
ending December 31, 2001.

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|(3) |  | Other Annual Compensation for perquisites for each individual named above
for 2002, 2001 and 2000 aggregated less than (a) 10% of the total annual
salary and bonus for each individual or (b) $50,000, whichever is lower;
therefore, no such amounts are included.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(4) |  | Amounts represent premiums for life insurance and long-term disability
policies, medical benefits and the Companys Profit Sharing and 401(k)
contributions. In fiscal 2002, the Companys Profit Sharing and 401(k)
contributions were $2,750, $2,750, $2,750 and $2,496 for Messrs. Griffith,
McPherson, Manske and Page respectively. During 2002, the Company paid
$19,025, $15,109, $78,948 and $23,582 in medical benefits for Messrs.
Griffith, McPherson, Manske and Page, respectively. During 2002, the
Company paid $103,748 in premiums for split dollar, term life insurance
and long-term disability policies for Mr. Griffith and $2,576, $6,436 and
$2,131 in premiums for term life insurance and long-term disability
policies for Messrs. McPherson, Manske and Page, respectively. Pursuant
to the Restructuring Agreement, Messrs. Griffith, McPherson, Manske and
Page received additional compensation of $469,305, $67,044, $67,044 and
$67,044, based on net proceeds distributed to holders of its Notes in
2002. See Executive Compensation  Senior Management Incentive Program,
Employment Agreements with Executive Officers and Key Employees and
Business Restructuring Agreement.
|   
|(5) |  | Mr. Mezzetta resigned as Vice President of FMI and General Manager of
Fitzgeralds Tunica on December 6, 2001.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

Option Grants

The Company did not grant any stock options during fiscal years ended December
31, 2002 and 2001. During 2000, a total of 271,000 stock options expired. The
Company has never granted stock appreciation rights.

Option Exercises

No named executive officers exercised stock options during the fiscal year
ended December 31, 2002 or held unexercised stock options as of December 31,
2002.

Employment Agreements with Executive Officers and Key Employees

The Company has entered into employment agreements with Messrs. Griffith,
McPherson, Manske and Page to serve in their present offices for terms expiring
June 28, 2003, July 5, 2003, September 1, 2003, and September 1, 2003,
respectively. Pursuant to the Amended and Restated Agreement Regarding
Pre-negotiated Restructuring dated as of November 1, 2002,
Mr. Griffith, among other things, agreed
to have his annual salary reduced by $30,000 per quarter commencing November 1,
2002; $40,000 per quarter commencing February 1, 2003; and $50,000 per quarter
commencing May 1, 2003 and all subsequent quarters thereafter.
As of February 21, 2003, Messrs. Griffith, McPherson, Manske and Page have annual salaries of
$445,500, $275,700, $275,700 and $275,700, respectively, and their respective
employment agreements generally provide for annual merit increases. The
employment agreements also provide that such persons will participate in the
Companys executive compensation plans, health plan and any other benefit plan
established for selected officers of the Company and that in the event of a
termination of employment without good cause (as defined in the agreements),
such persons will be entitled to any unpaid salary in a specified percentage
through the remainder of the term of their respective agreement. It
is not anticipated that such Employment Agreement will continue for
more than four months after a Plan of Reorganization is confirmed by
the Bankruptcy Court.

Consistent with industry practice, the Company has entered into employment
agreements with certain of its other vice presidents and departmental
directors. In accordance with the Restructuring Agreement, the Company has
agreed not to assume these employment agreements as provided for in Section 365
of the Bankruptcy Code.

33



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Executive Bonus Plan

The Company had previously established an Executive Bonus Plan to provide the
senior executive officers of the Company with a performance-based compensation
program. Effective January 1, 1999, the Company revised the threshold
established for bonus consideration to take into account the termination of
management and consulting services provided to Indian operations in Arizona and
New York. The new threshold was $25.0 million in earnings before interest,
taxes, depreciation and amortization, prior to accruing bonus expense and
adjusted for extraordinary, non-recurring items deemed non-operational in
nature. The bonus amount started at 1.4% at the $25.0 million level and
increased by one-tenth of one percent for each $1.0 million above $25.0 million
up to a maximum of 3%. Although the Bankruptcy Court entered an order to the
effect that the Executive Bonus Plan would remain in place during the
Bankruptcy Cases, pursuant to the Amended and Restated Restructuring Agreement Messrs. Philip D. Griffith, Paul H. Manske, Michael E.
McPherson and Max L. Page (collectively referred to as Senior Management)
agreed to forgo compensation pursuant to the Executive Bonus Plan for operating
years commencing January 1, 2002. Prior to the Amended and Restated Restructuring
Agreement the Compensation Committee had discretion concerning the payment of
executive bonuses.

Stock Option Incentive Plan

Prior to the commencement of the Bankruptcy Cases, the Company had adopted a
Stock Option Incentive Plan (the Stock Option Plan) which was approved by
stockholders in August 1997. The Stock Option Plan provides for the grant of
options to purchase Common Stock of the Company that are intended either to
qualify as incentive stock options within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended (the Code), or not intended to
qualify (non-qualified stock options). All officers, directors, employees,
consultants, advisers, independent contractors and agents are eligible to
receive options under the Stock Option Plan, except that only employees could
receive incentive stock options. The maximum number of shares available for
issuance under the Stock Option Plan is 1,000,000. At December 31, 2002,
there were no stock options outstanding under the Stock Option Plan. Since
there are no options outstanding under the Stock Option Plan, no options will
be granted and the Stock Option Plan will be terminated in connection with the
Bankruptcy Cases, a description of the Stock Option Plan would not be
meaningful.

Compensation Committee Interlocks and Insider Participation

The Compensation Committee of the Board of Directors of the Company is
comprised of Philip P. Hannifin and Patricia W. Becker, as Chairperson. Ms.
Becker was not an officer or employee of the Company during or prior to 2002.
Mr. Hannifin was not an officer or employee of the Company during 2002.

Senior Management Incentive Program

On December 21, 2000, the Bankruptcy Court approved a senior management
incentive program (the Incentive Program) as contemplated by the
Restructuring Agreement. In accordance with the Restructuring Agreement,
Senior Management agreed, subject to the Restructuring Agreement not being
terminated, that their pre-petition employment agreements with the Company
would not be assumed pursuant to Section 365 of the Bankruptcy Code. In
consideration of the Incentive Program, Senior Management further agreed to
forego alternative employment opportunities in favor of remaining with the
Company through December 31, 2001 in order to maintain the stability of
operations, maintain the Companys existing gaming licenses pending the sale of
its operating properties and to ensure a more

34



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##### Table of Contents



orderly liquidation process. It is not
anticipated that such Employment Agreement will continue for more
than four months after the Plan of Reorganization is confirmed by the
Bankruptcy Court.

In consideration of their services to the Company, the Incentive Program
provides for Senior Management to receive: (i) the compensation and benefits
provided for in their respective pre-petition employment agreements until the
sale of the Reno property; (ii) an incentive cash distribution generally
computed as a percentage of the net proceeds from the sale of certain of the
Companys assets distributed to the holders of the Notes in excess of $115.0
million; (iii) a retention and severance payment equal to an aggregate of $2.4
million; and (iv) payments of up to $2.0 million in consideration for entering
into non-competition agreements.




|         |  |                                                               
|-------- |  | --------------------------------------------------------------
|Item 12. |  | Security Ownership of Certain Beneficial Owners and Management

The table below sets forth to the best of the Companys knowledge certain
information regarding the beneficial ownership of the Common Stock as of
February 21, 2003 by (i) each person who beneficially owned more that 5% of the
outstanding Common Stock; (ii) each director of the Company; (iii) each other
person named in the Summary Compensation Table (See Item 11 - Executive
Compensation); and (iv) all executive officers and directors of the Company as
a group.

|                                                                |  |                    |           |          |  |  |      |   |  |  |  | 
|--------------------------------------------------------------- |  | ------------------ | --------- | -------- |  |  | ---- | - |  |  |  | 
|Name and address of Beneficial Owner                           
|                                                                |  | Number of Shares   |           | Percent 
|                                                                |  | Beneficially Owned |           | of Class
|                                                                |  |                    |           |         
|Philip D. Griffith
301 Fremont Street
Las Vegas, NV 89101       |  |                    | 3,419,105 | (a)      |  |  | 62.1 | %
|Putnam Investments, LLC
One Post Office Square
Boston, MA 02109 |  |                    | 392,628   | (b)      |  |  | 7.1  | %
|Paul H. Manske                                                  |  |                    | 123,565   | (c)      |  |  | 2.2  | %
|Max L. Page                                                     |  |                    | 123,565   | (d)      |  |  | 2.2  | %
|Philip P. Hannifin                                              |  |                    | 23,988    |          |  |  | *    |  
|Patricia W. Becker                                              |  |                    | 27,475    | (e)      |  |  | *    |  
|All directors and executive officers as a group (six persons)   |  |                    | 4,102,258 |          |  |  | 74.5 | %



---

|*   |  | Indicates less than 1%                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(a) |  | Held by the Philip D. Griffith Gaming Trust of which Mr. Griffith is a
trustee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   
|(b) |  | Putnam Investments, LLC (PI) is a holding company organized under
Massachusetts law. Filing on behalf of itself and its wholly-owned
subsidiary, Putnam Investment Management, Inc. (PIM), an investment
advisor registered under Section 203 of the Investment Advisors Act of
1940, PI and PIM have reported beneficial ownership with shared
dispositive power over the shares listed. As part of the Putnam family of
mutual funds, Putnam Diversified Income Trust has reported beneficial
ownership with shared dispositive power over 223,713 shares of the 392,628
shares held by PIM. The source of this information is a Schedule 13G/A
filed by PI with the Securities and Exchange Commission on February 13,
2002. Ownership is reported as of December 31, 2001. The number of
shares listed in the schedule 13G/A filed by PI does not agree with the
384,560 shares reflected in our records as held by PI.
|   
|(c) |  | Held by the Paul H. Manske Family Trust of which Mr. Manske is a trustee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   
|(d) |  | Held by the Max Lynn Page 1987 Trust of which Mr. Page is a trustee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   
|(e) |  | Held by the Patricia W. Becker Family Trust of which Ms. Becker is a
trustee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

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|         |  |                                               
|-------- |  | ----------------------------------------------
|Item 13. |  | Certain Relationships and Related Transactions

Prior to 2002, the Company provided executive and administrative services to
each of its significant subsidiaries and allocated a portion of its corporate
overhead to each such significant subsidiary. This allocation did not
necessarily reflect the costs incurred by the Company in connection with such
support and accordingly, such allocation did not necessarily reflect that which
could be obtained from an unaffiliated party. In 2002, the Company charged to
Fitzgeralds Reno corporate expenses of $0.05 million. In connection with the
Bankruptcy Cases all transactions other than transactions entered into in the
ordinary course of business on terms generally made available to third parties,
will be subject to review and approval by the Bankruptcy Court.

In conjunction with the winding down of its affairs, as well as the orderly
liquidation of assets and liabilities of the Company pursuant to the filing of
its bankruptcies, and after obtaining the Bankruptcy Court approval, the
Company entered into a contract with Meritage Employer Services, LLC
(Meritage) on June 1, 2001 to assist in certain areas of that process.
Meritage agreed to hire the 16 employees of the Companys risk management
department and to provide (1) health benefits design, claims processing and
administration services, (2) liability claims investigation and administration
services, (3) property and casualty insurance consulting and (4) workers
compensation claims processing and administration. The amount of fees paid by
the Company to Meritage for 2002 and 2001 totaled $579,233 and $604,800,
respectively, plus reimbursable expenses and deposits. Meritage ownership is
comprised of Senior Management, outside director Phil Hannifin, and a former
executive of the Company, Kathleen Bryant.




|         |  |                        
|-------- |  | -----------------------
|Item 14. |  | Controls and Procedures

Based on the Chief Executive Officer and the Chief Financial Officer (the
Officers), evaluations of the Companys internal controls, disclosure
controls and procedures within 90 days of the filing date of this report, the
Officers have concluded that the effectiveness of such controls and procedures
is satisfactory. Furthermore, there were no significant changes in the
Companys internal controls or in other factors that could significantly affect
these controls subsequent to the date of their evaluation.

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##### Table of Contents






PART IV




|         |  |                                                                
|-------- |  | ---------------------------------------------------------------
|Item 15. |  | Exhibits, Financial Statement Schedules and Reports on Form 8-K

|    |  |                                                                                
|--- |  | -------------------------------------------------------------------------------
|(a) |  | 1.       Financial Statements. The following financial statements are attached:
|    |  | Independent Auditors Report                                                   
|    |  | Consolidated Balance Sheets as of December 31, 2002 and 2001                   
|    |  | Consolidated Statements of Operations for the Years Ended                      
|    |  | December 31, 2002, 2001, and 2000                                              
|    |  | Consolidated Statements of Stockholders Deficiency for the Years
Ended        
|    |  | December 31, 2002, 2001, and 2000                                              
|    |  | Consolidated Statements of Cash Flows for the Years Ended                      
|    |  | December 31, 2002, 2001, and 2000                                              
|    |  | Notes to Consolidated Financial Statements                                     
|    |  | 2.       Financial Statement Schedules.                                        
|    |  | Schedule II  Consolidated Valuation and Qualifying Accounts.                  
|    |  | Other Financial Statement Schedules are not required.                          
|    |  | 3.       Exhibits. Refer to (c) below                                          
|(b) |  | Reports on Form 8-K. For the last quarter of the fiscal year ended             
|    |  | December 31, 2002, the Company filed the following reports on Form 8-K:        
|    |  | Report on Form 8-K, Item 2 and 5, filed on February 27, 2003.                  
|(c) |  | Exhibits. Reference is made to the Index to Exhibits immediately               
|    |  | preceding the exhibits thereto.                                                

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, on
March 25,
2003.

| |  |                               
| |  | ------------------------------
| |  | Fitzgeralds Gaming Corporation
| |  |                               
| |  | By: /s/ Michael E. McPherson  
| |  | Michael E. McPherson          
| |  | Executive Vice President,     
| |  | Chief Financial Officer,      
| |  | Treasurer and Secretary       

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POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Philip D. Griffith and Michael E. McPherson, and
each of them, his or her own attorneys-in-fact, each with the power of
substitution, for him or her in any and all capacities, to sign any amendments
to this Report on Form 10-K and to file the same, with exhibits thereto and
other documents in connection therewith, with the Securities and Exchange
Commission, hereby ratifying and confirming all that each of said
attorneys-in-fact, or his substitute or substitutes, may do or cause to be done
by virtue hereof.

Pursuant to the requirements of 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 date indicated.

| |  |                          |  |                                      |  |               
| |  | ------------------------ |  | ------------------------------------ |  | --------------
| |  | Signature                |  | Title                                |  | Date          
| |  |                          |  |                                      |  |               
| |  | /s/ Philip D. Griffith   |  | Chairman, President, Chief Executive |  | March 25, 2003
| |  |                          |  | Officer and Director (Principal      |  |               
| |  | Philip D. Griffith       |  | Executive Officer)                   |  |               
| |  |                          |  |                                      |  |               
| |  | /s/ Michael E. McPherson |  | Executive Vice President, Chief      |  | March 25, 2003
| |  |                          |  | Financial Officer, Treasurer and     |  |               
| |  | Michael E. McPherson     |  | Secretary (Principal Financial and   |  |               
| |  |                          |  | Accounting Officer)                  |  |               
| |  |                          |  |                                      |  |               
| |  | /s/ Philip P. Hannifin   |  | Director                             |  | March 25, 2003
| |  |                          |  |                                      |  |               
| |  | Philip P. Hannifin       |  |                                      |  |               
| |  |                          |  |                                      |  |               
| |  | /s/ Patricia W. Becker   |  | Director                             |  | March 25, 2003
| |  |                          |  |                                      |  |               
| |  | Patricia W. Becker       |  |                                      |  |               
| |  |                          |  |                                      |  |               
| |  | /s/ Max L. Page          |  | Director                             |  | March 25, 2003
| |  |                          |  |                                      |  |               
| |  | Max L. Page              |  |                                      |  |               

39



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CERTIFICATIONS

I, Philip D. Griffith, certify that:



|1) |  | I have reviewed this annual report on Form 10-K of Fitzgeralds Gaming
Corporation (the Registrant)                                                                                                                                                                                                                   
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2) |  | Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to sate a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this annual report.
|  
|3) |  | Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the Registrant as of, and for, the periods presented in the report.                          
|  
|4) |  | The Registrants other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the Registrant and we
have:                                                                                               



| | a) |  | designed such disclosure controls and procedures to ensure that
material information relating to the Registrant, including its
consolidated subsidiaries is made known to us by others within those
entities, particularly during the period in which this annual report is
being prepared;
| | -- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | evaluated the effectiveness of the Registrants disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this annual report (the Evaluation Date); and                                                                                                 
|
| | c) |  | presented in this annual report, our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;                                                                                                                      



|5) |  | The Registrants other certifying officer and I have disclosed, based on
our most recent evaluation, to the Registrants auditors and to the audit
committee and the audit committee of Registrants board of directors (or
persons performing the equivalent function):
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a) |  | all significant deficiencies in the design or operation of internal
controls which could adversely affect the Registrants ability to
record, process, summarize and report financial data and have
identified for the Registrants auditors any material weaknesses in
internal controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | any fraud, whether or not material, that involves management or
other employees who have a significant role in the Registrants
internal controls; and                                                                                                                                        



|6) |  | The Registrants other certifying officer and I have indicated in this
annual report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and
material weaknesses
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Dated: March 25, 2003

| |                                      
| | -------------------------------------
| | /s/ Philip D. Griffith               
| | Philip D. Griffith                   
| | President and Chief Executive Officer

40



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##### Table of Contents



CERTIFICATIONS

I, Michael E. McPherson, certify that:



|1) |  | I have reviewed this annual report on Form 10-K of Fitzgeralds Gaming
Corporation (the Registrant)                                                                                                                                                                                                                   
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2) |  | Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to sate a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this annual report.
|  
|3) |  | Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the Registrant as of, and for, the periods presented in the report.                          
|  
|4) |  | The Registrants other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the Registrant and we
have:                                                                                               



| | a) |  | designed such disclosure controls and procedures to ensure that
material information relating to the Registrant, including its
consolidated subsidiaries is made known to us by others within those
entities, particularly during the period in which this annual report is
being prepared;
| | -- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | evaluated the effectiveness of the Registrants disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this annual report (the Evaluation Date); and                                                                                                 
|
| | c) |  | presented in this annual report, our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;                                                                                                                      



|5) |    | The Registrants other certifying officer and I have disclosed, based on
our most recent evaluation, to the Registrants auditors and to the audit
committee and the audit committee of Registrants board of directors (or
persons performing the equivalent function):                                                                                                            
|-- | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   | a) | all significant deficiencies in the design or operation of internal
controls which could adversely affect the Registrants ability to
record, process, summarize and report financial data and have
identified for the Registrants auditors any material weaknesses in
internal controls; and                                                                                      
|  
|   | b) | any fraud, whether or not material, that involves management or
other employees who have a significant role in the Registrants
internal controls; and                                                                                                                                                                                                                              
|  
|6) |    | The Registrants other certifying officer and I have indicated in this
annual report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and
material weaknesses

|       |                |  |  |                                   
|------ | -------------- |  |  | ----------------------------------
|Dated: | March 25, 2003 |  |  | /s/ Michael E. McPherson          
|       |                |  |  | Michael E. McPherson              
|       |                |  |  | Executive Vice President and Chief
|       |                |  |  | Financial Officer                 

41



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##### Table of Contents



TABLE OF CONTENTS

|                             |                                                                                                          |  |      |       | 
|---------------------------- | -------------------------------------------------------------------------------------------------------- |  | ---- | ----- | 
|                             |                                                                                                          |  | Page
|ITEM 8. FINANCIAL STATEMENTS |                                                                                                          |  |      |      
|                             | Independent Auditors Report                                                                             |  |      | F - 2 | 
|                             | Consolidated Balance Sheets as of December 31, 2002 and 2001                                             |  |      | F - 3 | 
|                             | Consolidated Statements of Operations for the Years Ended December 31, 2002,
2001 and 2000               |  |      | F - 5 | 
|                             | Consolidated Statements of Stockholders Deficiency for the Years Ended
December 31, 2002, 2001 and 2000 |  |      | F - 6 | 
|                             | Consolidated Statements of Cash Flows for the Years Ended December 31, 2002,
2001 and 2000               |  |      | F - 7 | 
|                             | Notes to Consolidated Financial Statements                                                               |  |      | F - 9 | 



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##### Table of Contents



INDEPENDENT AUDITORS REPORT

Fitzgeralds Gaming Corporation:

We have audited the accompanying consolidated balance sheets of Fitzgeralds
Gaming Corporation and subsidiaries (the Company) (Debtor-in-Possession) as
of December 31, 2002 and 2001, and the related consolidated statements of
operations, stockholders deficiency, and cash flows for each of the three
years in the period ended December 31, 2002. Our audits also included the
financial statement schedule listed in the Index at Item 15(a)(2). These
financial statements and financial statement schedule are the responsibility of
the Companys management. Our responsibility is to express an opinion on these
financial statements and the financial statement schedule based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. 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, such consolidated financial statements present fairly, in all
material respects, the financial position of Fitzgeralds Gaming Corporation and
subsidiaries as of December 31, 2002 and 2001, and the results of their
operations and their cash flows for each of the three years in the period ended
December 31, 2002 in conformity with accounting principles generally accepted
in the United States of America. Also, in our opinion, such financial
statement schedule taken as a whole, presents fairly in all material respects
the information set forth therein.

As discussed in Note 2, the Company has filed for reorganization under Chapter
11 of the Federal Bankruptcy Code. The accompanying consolidated financial
statements do not purport to reflect or provide for the consequences of the
bankruptcy proceedings. In particular, such consolidated financial statements
do not purport to show (a) as to assets, their realizable value on a
liquidation basis or their availability to satisfy liabilities; (b) as to
prepetition liabilities, the amounts that may be allowed for claims or
contingencies, or the status and priority thereof; (c) as to stockholder
accounts, the effect of any changes that may be made in the capitalization of
the Company; or (d) as to operations, the effect of any changes that may be
made in its business.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to
the consolidated financial statements, the Companys event of default on its
Senior Secured Notes, along with its recurring losses from operations, negative
working capital and stockholders capital deficiency raise substantial doubt
about its ability to continue as a going concern. Managements plans
concerning these matters are discussed in Note 2. The consolidated financial
statements do not include adjustments that might result from the outcome of
this uncertainty.

DELOITTE & TOUCHE LLP

Las Vegas, Nevada
February 21, 2003

F - 2



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##### Table of Contents



FITZGERALDS GAMING CORPORATION (Debtor-In-Possession)

CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2002 AND 2001

|                                               |                                                                                    |                      |  |  |  |      |            |            |            |             |            |            |            | 
|---------------------------------------------- | ---------------------------------------------------------------------------------- | -------------------- |  |  |  | ---- | ---------- | ---------- | ---------- | ----------- | ---------- | ---------- | ---------- | 
|ASSETS                                         |                                                                                    |                      |  |  |  | 2002 |            | 2001      
|                                               |                                                                                    |                      |  |  |  |      |            |           
|CURRENT ASSETS:                                |                                                                                    |                      |  |  |  |      |            |            |            |             |            |           
|                                               | Cash and cash equivalents                                                          |                      |  |  |  |      | $          | 14,525,248 |            |             | $          | 25,609,012 |           
|                                               | Accounts receivable, net of allowance for doubtful accounts of $24,412 and $49,000 |                      |  |  |  |      |            | 357,196    |            |             |            | 455,759    |           
|                                               | Inventories                                                                        |                      |  |  |  |      |            | 464,550    |            |             |            | 493,020    |           
|                                               | Prepaid expenses:                                                                  |                      |  |  |  |      |            |            |            |             |            |            |           
|                                               |                                                                                    | Gaming taxes         |  |  |  |      |            |            | 697,191    |             |            |            | 1,316,804  | 
|                                               |                                                                                    | Other                |  |  |  |      |            |            | 756,614    |             |            |            | 1,628,389  | 
|                                               |                                                                                    |                      |  |  |  |      |            |            |            |             |            |           
|                                               |                                                                                    | Total current assets |  |  |  |      |            |            | 16,800,799 |             |            |            | 29,502,984 | 
|                                               |                                                                                    |                      |  |  |  |      |            |            |            |             |            |           
|PROPERTY AND EQUIPMENT, net                    |                                                                                    |                      |  |  |  |      | 70,139     |            |            |             | 55,397     |           
|                                               |                                                                                    |                      |  |  |  |      |            |            |            |             |            |           
|OTHER ASSETS:                                  |                                                                                    |                      |  |  |  |      |            |            |            |             |            |           
|                                               | Net assets held for sale                                                           |                      |  |  |  |      |            | 12,490,263 |            |             |            | 12,000,000 |           
|                                               | Restricted cash                                                                    |                      |  |  |  |      |            | 4,399,464  |            |             |            | 8,184,732  |           
|                                               | Other assets                                                                       |                      |  |  |  |      |            | 1,705,445  |            |             |            | 1,629,020  |           
|                                               |                                                                                    |                      |  |  |  |      |            |            |            |             |            |           
|                                               |                                                                                    | Total other assets   |  |  |  |      |            |            | 18,595,172 |             |            |            | 21,813,752 | 
|                                               |                                                                                    |                      |  |  |  |      |            |            |            |             |            |           
|TOTAL                                          |                                                                                    |                      |  |  |  | $    | 35,466,110 |            |            | $           | 51,372,133 |           
|                                               |                                                                                    |                      |  |  |  |      |            |            |            |             |            |           
|See notes to consolidated financial statements |                                                                                    |                      |  |  |  |      |            |            |            | (Continued)

F-3



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##### Table of Contents



FITZGERALDS GAMING CORPORATION (Debtor-In-Possession)

CONSOLIDATED BALANCE SHEETS (CONTINUED)
DECEMBER 31, 2002 AND 2001

|                                               |                                                                                                                                                                                                                                                                                                                         |                              |                                             |              |           |              |            |              |           |              |  
|---------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------- | ------------------------------------------- | ------------ | --------- | ------------ | ---------- | ------------ | --------- | ------------ | -
|LIABILITIES AND STOCKHOLDERS' DEFICIENCY       |                                                                                                                                                                                                                                                                                                                         | 2002                         |                                             | 2001        
|                                               |                                                                                                                                                                                                                                                                                                                         |                              |                                             |             
|LIABILITIES NOT SUBJECT TO COMPROMISE          |                                                                                                                                                                                                                                                                                                                         |                              |                                             |              |           |              |            |             
|CURRENT LIABILITIES:                           |                                                                                                                                                                                                                                                                                                                         |                              |                                             |              |           |              |            |             
|                                               | Current portion of long-term debt                                                                                                                                                                                                                                                                                       |                              | $                                           | 121,946      |           |              | $          | 110,791      |          
|                                               | Accounts payable                                                                                                                                                                                                                                                                                                        |                              |                                             | 1,220,203    |           |              |            | 1,248,228    |          
|                                               | Accrued and other:                                                                                                                                                                                                                                                                                                      |                              |                                             |              |           |              |            |              |          
|                                               |                                                                                                                                                                                                                                                                                                                         | Payroll and related          |                                             |              | 1,334,562 |              |            |              | 2,567,982 |             
|                                               |                                                                                                                                                                                                                                                                                                                         | Progressive jackpots         |                                             |              | 72,138    |              |            |              | 73,458    |             
|                                               |                                                                                                                                                                                                                                                                                                                         | Outstanding chips and tokens |                                             |              | 72,421    |              |            |              | 170,835   |             
|                                               |                                                                                                                                                                                                                                                                                                                         | Other                        |                                             |              | 689,619   |              |            |              | 638,193   |             
|                                               |                                                                                                                                                                                                                                                                                                                         |                              |                                             |              |           |              |            |              |          
|                                               |                                                                                                                                                                                                                                                                                                                         |                              | Total current liabilities                   |              |           | 3,510,889    |            |              |           | 4,809,487    |  
|DUE TO MAJESTIC                                |                                                                                                                                                                                                                                                                                                                         |                              |                                            |              |           |              | 3,812,945  |             
|LONG-TERM DEBT, net of current portion         |                                                                                                                                                                                                                                                                                                                         |                              | 2,173,642                                   |              |           |              | 2,295,588  |             
|                                               |                                                                                                                                                                                                                                                                                                                         |                              |                                             |              |           |              |            |              |          
|                                               |                                                                                                                                                                                                                                                                                                                         |                              | Total liabilities not subject to compromise |              |           | 5,684,531    |            |              |           | 10,918,020   |  
|LIABILITIES SUBJECT TO COMPROMISE              |                                                                                                                                                                                                                                                                                                                         |                              | 91,989,338                                  |              |           |              | 97,335,321 |             
|                                               |                                                                                                                                                                                                                                                                                                                         |                              |                                             |              |           |              |            |              |          
|                                               |                                                                                                                                                                                                                                                                                                                         |                              | Total liabilities                           |              |           | 97,673,869   |            |              |           | 108,253,341  |  
|                                               |                                                                                                                                                                                                                                                                                                                         |                              |                                             |              |           |              |            |              |          
|COMMITMENTS AND CONTINGENCIES (Notes 8 and 14) |                                                                                                                                                                                                                                                                                                                         |                              |                                             |              |           |              |            |             
|CUMULATIVE REDEEMABLE PREFERRED STOCK          |                                                                                                                                                                                                                                                                                                                         |                              |                                             |              |           |              |            |             
|                                               | $.01 par value; $25 stated value; 800,000 shares authorized, issued and
outstanding; liquidation preference $20,000,000 stated value plus
accrued dividends of $36,345,989 and $28,630,707 recorded at
liquidation preference, net of unamortized offering costs and discount
of $3,793,419 and $4,728,546 respectively |                              |                                             | 52,552,570   |           |              |            | 43,902,161   |          
|                                               |                                                                                                                                                                                                                                                                                                                         |                              |                                             |              |           |              |            |              |          
|STOCKHOLDERS DEFICIENCY                       |                                                                                                                                                                                                                                                                                                                         |                              |                                             |              |           |              |            |             
|                                               | Common stock, $.01 par value; 29,200,000 shares authorized;
5,508,082 shares issued and outstanding                                                                                                                                                                                                                     |                              |                                             | 55,080       |           |              |            | 55,080       |          
|                                               | Additional paid-in-capital                                                                                                                                                                                                                                                                                              |                              |                                             | 23,675,511   |           |              |            | 23,675,511   |          
|                                               | Accumulated deficit                                                                                                                                                                                                                                                                                                     |                              |                                             | (138,490,920 | )         |              |            | (124,513,960 | )        
|                                               |                                                                                                                                                                                                                                                                                                                         |                              |                                             |              |           |              |            |              |          
|                                               |                                                                                                                                                                                                                                                                                                                         |                              | Total stockholders deficiency              |              |           | (114,760,329 | )          |              |           | (100,783,369 | )
|                                               |                                                                                                                                                                                                                                                                                                                         |                              |                                             |              |           |              |            |              |          
|TOTAL                                          |                                                                                                                                                                                                                                                                                                                         | $                            | 35,466,110                                  |              |           | $            | 51,372,133 |             
|                                               |                                                                                                                                                                                                                                                                                                                         |                              |                                             |              |           |              |            |              |          

See notes to consolidated financial statements

F - 4



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##### Table of Contents



FITZGERALDS GAMING CORPORATION (Debtor-In-Possession)CONSOLIDATED STATEMENTS OF OPERATIONS

FOR YEARS ENDED DECEMBER 31, 2002, 2001 AND 2000


|                                           |                                                                                                        |       |             |            |            |      |            |             |             |   |             |             |             | 
|------------------------------------------ | ------------------------------------------------------------------------------------------------------ | ----- | ----------- | ---------- | ---------- | ---- | ---------- | ----------- | ----------- | - | ----------- | ----------- | ----------- | 
|                                           |                                                                                                        |       |             | 2002       |            | 2001 |            | 2000       
|                                           |                                                                                                        |       |             |            |            |      |            |            
|OPERATING REVENUES:                        |                                                                                                        |       |             |            |            |      |            |             |             |   |             |            
|                                           | Casino                                                                                                 |       | $           | 30,675,029 |            |      | $          | 182,099,883 |             |   | $           | 181,724,286 |            
|                                           | Food and beverage                                                                                      |       |             | 5,976,575  |            |      |            | 24,192,643  |             |   |             | 25,809,006  |            
|                                           | Rooms                                                                                                  |       |             | 5,080,463  |            |      |            | 20,497,604  |             |   |             | 22,060,254  |            
|                                           | Other                                                                                                  |       |             | 799,058    |            |      |            | 4,398,948   |             |   |             | 4,549,683   |            
|                                           |                                                                                                        |       |             |            |            |      |            |             |             |   |             |             |            
|                                           |                                                                                                        | Total |             |            | 42,531,125 |      |            |             | 231,189,078 |   |             |             | 234,143,229 | 
|                                           | Less promotional allowances                                                                            |       |             | 5,530,198  |            |      |            | 35,158,058  |             |   |             | 34,041,653  |            
|                                           |                                                                                                        |       |             |            |            |      |            |             |             |   |             |             |            
|                                           |                                                                                                        | Net   |             |            | 37,000,927 |      |            |             | 196,031,020 |   |             |             | 200,101,576 | 
|                                           |                                                                                                        |       |             |            |            |      |            |             |             |   |             |             |            
|OPERATING COSTS AND EXPENSES:              |                                                                                                        |       |             |            |            |      |            |             |             |   |             |            
|                                           | Casino                                                                                                 |       |             | 15,775,848 |            |      |            | 85,714,549  |             |   |             | 84,739,719  |            
|                                           | Food and beverage                                                                                      |       |             | 4,004,888  |            |      |            | 14,432,471  |             |   |             | 15,398,511  |            
|                                           | Rooms                                                                                                  |       |             | 1,763,134  |            |      |            | 11,745,026  |             |   |             | 12,793,036  |            
|                                           | Other operating expense                                                                                |       |             | 357,065    |            |      |            | 2,001,112   |             |   |             | 2,115,389   |            
|                                           | Selling, general and administrative                                                                    |       |             | 17,431,748 |            |      |            | 52,292,223  |             |   |             | 56,446,676  |            
|                                           | Depreciation and amortization                                                                          |       |             | 30,342     |            |      |            | 33,886      |             |   |             | 13,977,855  |            
|                                           | Write-down of assets and lease settlement                                                              |       |             |           |            |      |            | 27,769,923  |             |   |             |            |            
|                                           | Reorganization items                                                                                   |       |             | 1,751,579  |            |      |            | (7,927,561  | )           |   |             | 149,536     |            
|                                           |                                                                                                        |       |             |            |            |      |            |             |             |   |             |             |            
|                                           |                                                                                                        | Total |             |            | 41,114,604 |      |            |             | 186,061,629 |   |             |             | 185,620,722 | 
|                                           |                                                                                                        |       |             |            |            |      |            |             |             |   |             |             |            
|INCOME (LOSS) FROM OPERATIONS              |                                                                                                        |       | (4,113,677  | )          |            |      | 9,969,391  |             |             |   | 14,480,854  |            
|OTHER INCOME (EXPENSE):                    |                                                                                                        |       |             |            |            |      |            |             |             |   |             |            
|                                           | Interest income                                                                                        |       |             | 66,973     |            |      |            | 154,210     |             |   |             | 1,039,946   |            
|                                           | Interest expense (contractual interest for 2002 and 2001
of $20,934,872 and $35,274,245, respectively) |       |             | (1,273,929 | )          |      |            | (4,682,388  | )           |   |             | (31,842,584 | )          
|                                           | Loss on sale of assets                                                                                 |       |             | (5,918     | )          |      |            | (1,125,130  | )           |   |             | (50,316     | )          
|                                           | Other income (expense)                                                                                 |       |             |           |            |      |            | 1,365       |             |   |             | (14,226     | )          
|                                           |                                                                                                        |       |             |            |            |      |            |             |             |   |             |            
|NET INCOME (LOSS)                          |                                                                                                        |       | (5,326,551  | )          |            |      | 4,317,448  |             |             |   | (16,386,326 | )          
|PREFERRED STOCK DIVIDENDS                  |                                                                                                        |       | (8,650,409  | )          |            |      | (7,496,002 | )           |             |   | (6,443,648  | )          
|                                           |                                                                                                        |       |             |            |            |      |            |             |             |   |             |             |            
|NET LOSS APPLICABLE TO COMMON STOCK        |                                                                                                        | $     | (13,976,960 | )          |            | $    | (3,178,554 | )           |             | $ | (22,829,974 | )          
|                                           |                                                                                                        |       |             |            |            |      |            |             |             |   |             |             |            
|NET LOSS PER COMMON SHARE                  |                                                                                                        | $     | (2.54       | )          |            | $    | (0.58      | )           |             | $ | (4.14       | )          
|                                           |                                                                                                        |       |             |            |            |      |            |             |             |   |             |             |            
|WEIGHTED AVERAGE COMMON SHARES OUTSTANDING |                                                                                                        |       | 5,508,082   |            |            |      | 5,508,082  |             |             |   | 5,508,082   |            
|                                           |                                                                                                        |       |             |            |            |      |            |             |             |   |             |             |            

See notes to consolidated financial statements

F - 5



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##### Table of Contents



FITZGERALDS GAMING CORPORATION (Debtor-In-Possession)

CONSOLIDATED STATEMENTS OF STOCKHOLDERS DEFICIENCY
FOR YEARS ENDED DECEMBER 31, 2002, 2001 AND 2000

|                           |                           |  |              |   |            |   |             |   |               |   |            |          |   |   |              |             |   |   |              |             |  
|-------------------------- | ------------------------- |  | ------------ | - | ---------- | - | ----------- | - | ------------- | - | ---------- | -------- | - | - | ------------ | ----------- | - | - | ------------ | ----------- | -
|                           |                           |  | Common Stock |   | Additional |   |             |   |               |   | Total     
|                           |                           |  |              |   | Paid-In    |   | Accumulated |   | Stockholders'
|                           |                           |  | Shares       |   | Amount     |   | Capital     |   | Deficit       |   | Deficiency
|                           |                           |  |              |   |            |   |             |   |               |   |           
|BALANCE, JANUARY 1, 2000   |                           |  | 5,508,082    |   |            | $ | 55,080      |   |               | $ | 23,954,220 |          |   | $ | (98,505,432  | )           |   | $ | (74,496,132  | )          
|                           | Net loss                  |  |              |  |            |   |             |  |               |   |            |         |   |   |              | (16,386,326 | ) |   |              | (16,386,326 | )
|                           | Preferred stock dividends |  |              |  |            |   |             |  |               |   |            |         |   |   |              | (6,443,648  | ) |   |              | (6,443,648  | )
|                           | Expired stock options     |  |              |  |            |   |             |  |               |   |            | (278,709 | ) |   |              |            |   |   |              | (278,709    | )
|                           |                           |  |              |   |            |   |             |   |               |   |            |          |   |   |              |             |   |   |              |             |  
|BALANCE, DECEMBER 31, 2000 |                           |  | 5,508,082    |   |            |   | 55,080      |   |               |   | 23,675,511 |          |   |   | (121,335,406 | )           |   |   | (97,604,815  | )          
|                           | Net income                |  |              |  |            |   |             |  |               |   |            |         |   |   |              | 4,317,448   |   |   |              | 4,317,448   |  
|                           | Preferred stock dividends |  |              |  |            |   |             |  |               |   |            |         |   |   |              | (7,496,002  | ) |   |              | (7,496,002  | )
|                           |                           |  |              |   |            |   |             |   |               |   |            |          |   |   |              |             |   |   |              |             |  
|BALANCE, DECEMBER 31, 2001 |                           |  | 5,508,082    |   |            |   | 55,080      |   |               |   | 23,675,511 |          |   |   | (124,513,960 | )           |   |   | (100,783,369 | )          
|                           | Net loss                  |  |              |  |            |   |             |  |               |   |            |         |   |   |              | (5,326,551  | ) |   |              | (5,326,551  | )
|                           | Preferred stock dividends |  |              |  |            |   |             |  |               |   |            |         |   |   |              | (8,650,409  | ) |   |              | (8,650,409  | )
|                           |                           |  |              |   |            |   |             |   |               |   |            |          |   |   |              |             |   |   |              |             |  
|BALANCE, DECEMBER 31, 2002 |                           |  | 5,508,082    |   |            | $ | 55,080      |   |               | $ | 23,675,511 |          |   | $ | (138,490,920 | )           |   | $ | (114,760,329 | )          
|                           |                           |  |              |   |            |   |             |   |               |   |            |          |   |   |              |             |   |   |              |             |  

See notes to consolidated financial statements

F - 6



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##### Table of Contents



FITZGERALDS GAMING CORPORATION (Debtor-In-Possession)

CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR YEARS ENDED DECEMBER 31, 2002, 2001 AND 2000

|                                      |                                                                                                    |                                                                                                 |   |            |            |      |   |           |             |   |   |             |            |  
|------------------------------------- | -------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------- | - | ---------- | ---------- | ---- | - | --------- | ----------- | - | - | ----------- | ---------- | -
|                                      |                                                                                                    |                                                                                                 |   | 2002       |            | 2001 |   | 2000     
|                                      |                                                                                                    |                                                                                                 |   |            |            |      |   |          
|CASH FLOWS FROM OPERATING ACTIVITIES: |                                                                                                    |                                                                                                 |   |            |            |      |   |           |             |   |   |            
|                                      | Net income (loss)                                                                                  |                                                                                                 | $ | (5,326,551 | )          |      | $ | 4,317,448 |             |   | $ | (16,386,326 | )         
|                                      | Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities: |                                                                                                 |   |            |            |      |   |           |             |   |   |             |           
|                                      |                                                                                                    | Depreciation and amortization                                                                   |   |            | 30,342     |      |   |           | 33,886      |   |   |             | 13,977,855 |  
|                                      |                                                                                                    | Amortization of note discount and offering costs                                                |   |            | 1,029,980  |      |   |           | 544,625     |   |   |             | 2,164,691  |  
|                                      |                                                                                                    | Write down of assets and lease settlement                                                       |   |            |           |      |   |           | 27,769,923  |   |   |             |           |  
|                                      |                                                                                                    | Loss on sale of assets                                                                          |   |            | 5,918      |      |   |           | 1,125,132   |   |   |             | 50,316     |  
|                                      |                                                                                                    | Gain on sale of assets to Majestic                                                              |   |            |           |      |   |           | (11,397,357 | ) |   |             |           |  
|                                      |                                                                                                    | Reorganization items incurred in connection with
chapter 11 and related legal proceedings       |   |            | 1,751,579  |      |   |           | 3,469,796   |   |   |             | 149,536    |  
|                                      |                                                                                                    | Write down of deferred stock options                                                            |   |            |           |      |   |           |            |   |   |             | (278,709   | )
|                                      | Changes in working capital, net of assets sold and
liabilities assumed:                            |                                                                                                 |   |            |            |      |   |           |             |   |   |             |           
|                                      |                                                                                                    | (Increase) decrease in accounts receivable, net                                                 |   |            | 98,563     |      |   |           | 303,430     |   |   |             | (436,719   | )
|                                      |                                                                                                    | (Increase) decrease in advances to
affiliated companies                                         |   |            | (148,255   | )    |   |           | (5,200,369  | ) |   |             | 97,774     |  
|                                      |                                                                                                    | Decrease in inventories                                                                         |   |            | 28,470     |      |   |           | 23,971      |   |   |             | 254,916    |  
|                                      |                                                                                                    | (Increase) decrease in prepaid expenses                                                         |   |            | 1,491,388  |      |   |           | 371,095     |   |   |             | (758,532   | )
|                                      |                                                                                                    | Increase in other assets                                                                        |   |            | (76,425    | )    |   |           | (194,834    | ) |   |             | (81,422    | )
|                                      |                                                                                                    | Increase (decrease) in accounts payable                                                         |   |            | (28,025    | )    |   |           | 1,016,653   |   |   |             | (2,792,761 | )
|                                      |                                                                                                    | Increase (decrease) in due to Majestic                                                          |   |            | (3,812,945 | )    |   |           | 3,812,945   |   |   |             |           |  
|                                      |                                                                                                    | Increase in liabilities subject to compromise                                                   |   |            |           |      |   |           | 149,835     |   |   |             | 120,125    |  
|                                      |                                                                                                    | Decrease in accrued interest                                                                    |   |            |           |      |   |           | (44,813,080 | ) |   |             |           |  
|                                      |                                                                                                    | Increase (decrease) in accrued and other liabilities                                            |   |            | (1,281,728 | )    |   |           | 30,235      |   |   |             | 14,632,357 |  
|                                      |                                                                                                    |                                                                                                 |   |            |            |      |   |           |             |   |   |             |           
|                                      |                                                                                                    | Net cash provided by (used in) operating activities
before reorganization items                 |   |            | (6,237,689 | )    |   |           | (18,636,666 | ) |   |             | 10,713,101 |  
|                                      | Reorganization items:                                                                              |                                                                                                 |   |            |            |      |   |           |             |   |   |             |           
|                                      |                                                                                                    | Interest received on cash accumulated because of
the bankruptcy proceedings                     |   |            | 345,613    |      |   |           | 650,835     |   |   |             |           |  
|                                      |                                                                                                    | Professional fees paid for services rendered in
connection with the bankruptcy proceedings      |   |            | (1,886,247 | )    |   |           | (3,278,095  | ) |   |             |           |  
|                                      |                                                                                                    | Other reorganization items incurred in connection
with chapter 11 and related legal proceedings |   |            | (210,945   | )    |   |           | (842,536    | ) |   |             | (149,536   | )
|                                      |                                                                                                    |                                                                                                 |   |            |            |      |   |           |             |   |   |             |           
|                                      |                                                                                                    | Net cash provided by (used in) operating activities                                             |   |            | (7,989,268 | )    |   |           | (22,106,462 | ) |   |             | 10,563,565 |  
|                                      |                                                                                                    |                                                                                                 |   |            |            |      |   |           |             |   |   |             |           

See notes to consolidated financial statements

(Continued)


F - 7



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##### Table of Contents



FITZGERALDS GAMING CORPORATION (Debtor-In-Possession)

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
FOR YEARS ENDED DECEMBER 31, 2002, 2001 AND 2000

|                                                                                  |                                        |                                                     |             |            |            |      |            |              |              |   |             |             |             |  
|--------------------------------------------------------------------------------- | -------------------------------------- | --------------------------------------------------- | ----------- | ---------- | ---------- | ---- | ---------- | ------------ | ------------ | - | ----------- | ----------- | ----------- | -
|                                                                                  |                                        |                                                     |             | 2002       |            | 2001 |            | 2000        
|                                                                                  |                                        |                                                     |             |            |            |      |            |             
|CASH FLOWS FROM INVESTING ACTIVITIES:                                             |                                        |                                                     |             |            |            |      |            |              |              |   |             |            
|                                                                                  | Proceeds from sale of assets           |                                                     |             |           |            |      |            | 141,049,970  |              |   |             | 41,971      |            
|                                                                                  | Acquisition of property and equipment  |                                                     |             | (393,996   | )          |      |            | (1,814,797   | )            |   |             | (10,889,665 | )          
|                                                                                  | Increase (decrease) in restricted cash |                                                     |             | 3,785,268  |            |      |            | (4,195,732   | )            |   |             | (2,799,000  | )          
|                                                                                  |                                        |                                                     |             |            |            |      |            |              |              |   |             |             |            
|                                                                                  |                                        | Net cash provided by (used in) investing activities |             |            | 3,391,272  |      |            |              | 135,039,441  |   |             |             | (13,646,694 | )
|                                                                                  |                                        |                                                     |             |            |            |      |            |              |              |   |             |             |            
|CASH FLOWS FROM FINANCING ACTIVITIES:                                             |                                        |                                                     |             |            |            |      |            |              |              |   |             |            
|                                                                                  | Repayment of Senior Secured Notes      |                                                     |             | (6,227,708 | )          |      |            | (105,266,358 | )            |   |             |            |            
|                                                                                  | Repayment of long-term debt            |                                                     |             | (258,060   | )          |      |            | (350,869     | )            |   |             | (739,205    | )          
|                                                                                  |                                        |                                                     |             |            |            |      |            |              |              |   |             |             |            
|                                                                                  |                                        | Net cash used in financing activities               |             |            | (6,485,768 | )    |            |              | (105,617,227 | ) |             |             | (739,205    | )
|                                                                                  |                                        |                                                     |             |            |            |      |            |              |              |   |             |             |            
|NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS                              |                                        |                                                     | (11,083,764 | )          |            |      | 7,315,752  |              |              |   | (3,822,334  | )          
|CASH AND CASH EQUIVALENTS
BEGINNING OF YEAR                                       |                                        |                                                     | 25,609,012  |            |            |      | 8,181,388  |              |              |   | 22,115,594  |            
|CASH AND CASH EQUIVALENTS INCLUDED IN
NET ASSETS HELD FOR SALE, BEGINNING OF YEAR |                                        |                                                     |            |            |            |      | 10,111,872 |              |              |   |             |            
|CASH AND CASH EQUIVALENTS INCLUDED IN
NET ASSETS HELD FOR SALE, END OF YEAR       |                                        |                                                     |            |            |            |      |           |              |              |   | (10,111,872 | )          
|                                                                                  |                                        |                                                     |             |            |            |      |            |              |              |   |             |             |            
|CASH AND CASH EQUIVALENTS
END OF YEAR                                             |                                        | $                                                   | 14,525,248  |            |            | $    | 25,609,012 |              |              | $ | 8,181,388   |            
|                                                                                  |                                        |                                                     |             |            |            |      |            |              |              |   |             |             |            

See notes to consolidated financial statements

F - 8



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##### Table of Contents



FITZGERALDS GAMING CORPORATION (Debtor-In-Possession)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR YEARS ENDED DECEMBER 31, 2002, 2001 AND 2000



|1. |  | ORGANIZATION AND FINANCIAL STATEMENT PRESENTATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|-- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   |  | Fitzgeralds Gaming Corporation (the Company) is a gaming holding company
that until December 6, 2001 owned and operated four Fitzgeralds-brand
casino-hotels, in downtown Las Vegas, Nevada (Fitzgeralds Las Vegas),
Reno, Nevada (Fitzgeralds Reno), Tunica, Mississippi (Fitzgeralds
Tunica), and Black Hawk, Colorado (Fitzgeralds Black Hawk), collectively
referred to as (the Properties). On December 6, 2001, the Company sold
substantially all of the assets and related liabilities of its Fitzgeralds
Las Vegas, Fitzgeralds Mississippi and Fitzgeralds Black Hawk properties to
Majestic Investors Holding, LLC (Majestic).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|  
|   |  | The Company currently conducts substantially all of its business through
wholly owned subsidiaries: Fitzgeralds Reno, Inc. (FRI); Fitzgeralds
South, Inc. (FSI); and Fitzgeralds Incorporated (FI). FRI directly owns
and operates Fitzgeralds Reno; FSI owns the residual assets and liabilities
of Fitzgeralds Las Vegas (FLVI) and Fitzgeralds Tunica (FMI) through
wholly owned subsidiaries; and FI owns the residual assets and liabilities
of Fitzgeralds Black Hawk through wholly-owned subsidiaries, including 101
Main Street Limited Liability Company (101 Main).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|  
|   |  | Nevada Club, Inc. (NCI), a wholly owned subsidiary of the Company, owned
and operated the Nevada Club in Reno, Nevada. The Nevada Club was sold in
June 1999.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|  
|   |  | The Company incurred net loss of $5.3 million in 2002 and net income of $4.3
million in 2001. The Company is highly leveraged as total indebtedness
including the 12.25% Senior Secured Notes which mature December 15, 2004
(the Notes) was $95.8 million at December 31, 2002 and $101.5 million at
December 31, 2001. The Companys stockholders deficiency was $114.8
million and $100.8 million at December 31, 2002 and 2001, respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|  
|   |  | The accompanying financial statements have been prepared on a going concern
basis. At December 31, 2002, liabilities exceeded assets by approximately
$62.2 million and stockholders deficiency was $114.8 million. The
Companys inability to meet the interest payment on the Notes, along with
its recurring losses from operations in prior years, negative working
capital and stockholders capital deficiency, raise substantial doubt about
its ability to continue as a going concern.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|  
|2. |  | PETITION FOR RELIEF UNDER CHAPTER 11                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|  
|   |  | General                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|  
|   |  | On December 5, 2000, the Company commenced cases under Chapter 11 of the
Bankruptcy Code (collectively, the Bankruptcy Cases) in the United States
Bankruptcy Court for the Northern District of Nevada (the Bankruptcy
Court). The Bankruptcy Cases are jointly administered and coordinated
under Case No. BK-N-00-33467 GWZ. The Bankruptcy Cases were commenced in
accordance with an Agreement Regarding Pre-Negotiated Restructuring, dated
as of December 1, 2000 (the Restructuring Agreement) with the holders (the
Consenting Noteholders) of a majority in interest of the Companys 12.25%
Senior Secured Notes (the Notes) issued under an indenture dated December
30, 1997 (the Indenture). The Restructuring Agreement contemplates an
expeditious and orderly sale of all of the Companys operating assets and
properties as going concerns. The Company has been informed by
Contrarian Capital Advisors L.L.C. (Contrarian), one of
the Consenting Noteholders, that as of the date
hereof substantially all of the Notes held by the Consenting Noteholders are now held by
Contrarian and its affiliates.

F - 9



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##### Table of Contents





| |  | The Restructuring Agreement
provided a vehicle for liquidating the assets of
the Company in the Bankruptcy Court through Chapter 11 of the Bankruptcy
Code. Upon execution of the Restructuring Agreement and before commencement
of the Bankruptcy Cases, the Company distributed $13.0 million in Excess
Cash (as that term is defined in the Restructuring Agreement) to the trustee
under the Indenture (the Indenture Trustee) to be applied to unpaid and
accrued Indenture Trustees fees and expenses incurred and as partial
payment of accrued and unpaid interest and principal as provided in the
Indenture.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | Pursuant to the Restructuring Agreement and an order entered by the
Bankruptcy Court, the Company was required to distribute unrestricted cash
(which includes cash in net assets held for sale) in excess of $24.8 million
to holders of its Notes within 45 days after the end of each quarter. In
May, August and November 2001, the Company distributed $1.8 million, $7.7
million and $7.2 million, respectively, in Excess Cash to the Indenture
Trustee to be applied to accrued and unpaid interest and principal as
provided in the Indenture. On December 6, 2001, the Company sold
substantially all of the assets and related liabilities of its Fitzgeralds
Las Vegas, Fitzgeralds Mississippi and Fitzgeralds Black Hawk properties to
Majestic. At that time, approximately $133.3 million was distributed to the
Indenture Trustee from the proceeds of the sale. The Company and the
Informal Committee subsequently established a new threshold for cash
reserves of $16.5 million, which was approved by the Bankruptcy Court on
November 27, 2002 and effective November 1, 2002. Pursuant to that order, the Company distributed $6.2
million to the Indenture Trustee to be applied to accrued and unpaid
interest and principal. As part of the Restructuring Agreement, the
Consenting Noteholders and Indenture Trustee agreed to forbear from
exercising certain of their rights otherwise allowable under the Notes and
the Indenture.
|
| |  | As of the commencement of the Bankruptcy Cases, the parties to the
Restructuring Agreement each concluded that the fair market value of the
Companys real and personal property given as collateral for the Notes was
less than the total outstanding principal and interest due under the Notes,
and that the fair market value of the real and personal property not
securing the Notes was less than the amount of the unsecured deficiency
claim of the holders of the Notes. As a result, it was not expected then
and is still not expected that any distribution will be made to holders of
the existing capital stock of the Company. The Restructuring Agreement
requires that as part of the liquidation process, all of the existing common
stock and preferred stock of the Company is to be canceled and extinguished
without payment therefor.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| |  | In accordance with the Restructuring Agreement, an auction sale was to be
scheduled for no later than June 15, 2001 in the Bankruptcy Court with
respect to those operating assets and properties not sold pursuant to
negotiated sales agreements such as the purchase agreement with Majestic.
With the consent of the Consenting Noteholders, the auction sale was not
conducted and the Company and the Consenting Noteholders executed an
amendment to the Restructuring Agreement, which was approved by the
Bankruptcy Court on November 27, 2002 and effective
November 1, 2002, (the Amended and Restated Restructuring
Agreement.) The Amended and Restated Restructuring Agreement
provided for the Company to attempt to conduct the auction sale of the one
remaining operating property, Fitzgeralds Reno as soon as possible.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| |  | Under the terms of the Amended and Restated Restructuring Agreement, upon the closing of each
sale of the Companys assets, the net proceeds of the collateral for the
Notes, less certain reserves for management incentives and other
liabilities, were required to be distributed to the Indenture Trustee for the benefit of
and distribution to the holders of the Notes in accordance with the
Indenture. All of the Companys assets remaining after such sales,
including any notes received as part of the consideration for the sales of
the Companys assets and payment of remaining liabilities of the Company,
were to have been transferred to a liquidating trust created for the benefit of the
holders of the Notes and others under a plan of reorganization to be
consistent with the terms of the Amended and Restated Restructuring Agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
| |  | On December 2, 2002, the Bankruptcy Court issued an Order approving the
adequacy of the disclosures in the Companys Disclosure Statement and
setting deadlines for balloting an opposing confirmation of the                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

F - 10



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##### Table of Contents





| |  | Companys Plan of
Reorganization (the Initial Plan). The confirmation hearing on
the Initial Plan was set for March 6, 2003 but was continued to
April 21, 2003. A significant number of Consenting Noteholders,
including several Consenting Noteholders managed by Contrarian,
voted to reject the Initial Plan. The Company believes that these votes were
in violation of the obligations of the Consenting Noteholders to vote
in favor of the Initial Plan and declared the Consenting Noteholders in
breach of the Amended and Restated Restructuring Agreement and filed with the Bankruptcy
Court a motion seeking to disallow the votes. The motion to disallow
the votes was set for hearing before the  Bankruptcy Court on
March 6, 2003.

Prior to the hearing on March 6,
2003, the Company and Contrarian agreed to Amendments No. 1 to
the Amended and Restated
Restructuring Agreement (the Current Restructuring
Agreement) to provide, among other matters, (i) that
Fitzgeralds Reno would not be sold, but would be retained by the
Company and (ii) for an amendment to the Initial Plan (in the form of
a Second Amended Plan of Reorganization (the New Plan)) to permit the
conversion of the indebtedness due the holders of the Notes into
equity of the successor to the Company. The Current Restructuring
Agreement, the New Plan and the Supplemental Disclosure Statement
to accompany Debtors Amended Plan of Reorganization (the
Disclosure Statement) were filed with the Bankruptcy Court on March 20, 2003.
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | In light of the regulatory approvals needed to accomplish the liquidations,
and recognizing the need to retain senior management in order to insure
continuity and compliance with all gaming regulations and licensing
requirements in the Companys operations during the process, the
Restructuring Agreement required implementation of a senior management
incentive and retention program. After obtaining Bankruptcy Court approval
in December 2000, this program was adopted by the Company in order to retain
Philip D. Griffith, Michael E. McPherson, Max L. Page and Paul H. Manske,
(the Senior Management) each an officer, director and/or senior executive
of the Company, as key executives and to compensate them for their continued
employment with the Company during the process.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|
| |  | For further information concerning the Restructuring Agreement, please refer
to our Current Report on Form 8-K dated, December 6, 2001, and our
subsequent filing with the Securities and Exchange Commission. For further
information concerning the Plan of Reorganization, please refer to our
Current Report on Form 8-K dated February 27, 2003. Until such time as the
Plan of Reorganization is confirmed by the Bankruptcy Court, the
Restructuring Agreement, Disclosure Statement and Plan of Reorganization are
subject to change.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
| |  | Reorganization Items                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| |  | As of December 31, 2002 and 2001, the Company incurred the following
expenses subsequent to the filing of the Bankruptcy Cases:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

|                      |                                                                               |      |           |           |   |   |            |             |  
|--------------------- | ----------------------------------------------------------------------------- | ---- | --------- | --------- | - | - | ---------- | ----------- | -
|                      |                                                                               | 2002 |           | 2001     
|                      |                                                                               |      |           |          
|Reorganization items: |                                                                               |      |           |          
|                      | Post-petition professional fees                                               |      | $         | 1,886,247 |   |   | $          | 3,278,095   |  
|                      | U. S. trustee fees                                                            |      |           | 62,662    |   |   |            | 206,750     |  
|                      | Other                                                                         |      |           | 148,283   |   |   |            | 635,786     |  
|                      | Gain on sale of assets to Majestic                                            |      |           |          |   |   |            | (11,397,357 | )
|                      | Interest earned on accumulated cash resulting from the
bankruptcy proceedings |      |           | (345,613  | ) |   |            | (650,835    | )
|                      |                                                                               |      |           |           |   |   |            |            
|                      |                                                                               | $    | 1,751,579 |           |   | $ | (7,927,561 | )          
|                      |                                                                               |      |           |           |   |   |            |            



| |                                  
| | ---------------------------------
| | Liabilities Subject to Compromise



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

|                                   |                                  |   |            |            |      |   |            |            |  
|---------------------------------- | -------------------------------- | - | ---------- | ---------- | ---- | - | ---------- | ---------- | -
|                                   |                                  |   | 2002       |            | 2001
|                                   |                                  |   |            |            |     
|Liabilities subject to compromise: |                                  |   |            |            |      |   |            |           
|                                   | Notes                            |   | $          | 93,505,934 |      |   | $          | 99,733,642 |  
|                                   | Discount on the Notes            |   |            | (288,154   | )    |   |            | (613,709   | )
|                                   | Debt offering costs on the Notes |   |            | (1,350,147 | )    |   |            | (2,054,572 | )
|                                   | Unsecured creditors              |   |            | 121,705    |      |   |            | 269,960    |  
|                                   |                                  |   |            |            |      |   |            |           
|                                   |                                  | $ | 91,989,338 |            |      | $ | 97,335,321 |           
|                                   |                                  |   |            |            |      |   |            |           



|3. |  | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES                                                                                                                                                         
|-- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   |  | Consolidation- The consolidated financial statements of the Company include
the accounts of its wholly owned and majority owned subsidiaries. All
inter-company balances and transactions have been

F - 11



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##### Table of Contents





| |  | eliminated in the consolidation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | Cash and Cash Equivalents- Cash includes cash required for gaming
operations. The Company considers cash equivalents to include short-term
investments with maturities of ninety days or less at the date of purchase.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| |  | Inventories- consisting principally of food and beverage and operating
supplies are stated at the lower of first-in, first-out cost or market.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| |  | The estimated cost of normal operating quantities (base stock) of china,
silverware, glassware, linen, uniforms and utensils has been recorded as an
asset and is not being depreciated. Costs of base stock replacements are
expensed as incurred.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|
| |  | Property and Equipment- are stated at cost. Depreciation and amortization
are computed using the straight-line method over the estimated service lives
of the assets. Costs of major improvements are capitalized; costs of normal
repairs and maintenance are charged to expenses as incurred. Gains or losses
on disposals are recognized. Certain of the assets of the Operating
Properties were classified as held for sale upon consummation of the
Purchase Agreement with Majestic in accordance with Statement of Financial
Accounting Standards (SFAS) No. 121, Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed of. This
standard requires that assets to be disposed of shall be reported at the
lower of carrying amount or fair value less costs to sell and shall not be
depreciated or amortized while they are held for disposal. The Company
discontinued recording depreciation and amortization expense for property
and equipment included in net assets held for sale subsequent to the filing
of the Bankruptcy Cases and consummation of the Purchase Agreement with
Majestic based on the requirements of SFAS No. 121.
|
| |  | Debt Offering Costs- Costs associated with the issuance of the Notes are
deferred and amortized over the life of the indebtedness using the effective
interest method. In 2001, the Company wrote-off the cost associated with
the issuance of the Notes in proportion with the amount paid on the Notes.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| |  | Restricted Cash At December 31, 2002 and 2001, restricted cash represents
interest bearing certificates of deposit with a bank securing letters of
credit for various workers compensation and insurance plans (see Note 14). At December 31, 2002 and 2001 a deposit of $2,400,000 is held in an escrow
account for the benefit of the Company related to the implementation of a
senior management incentive and retention program in conjunction with the Restructuring Agreement (see Note 2). At December 31, 2001 $3,761,166 of cash was held in an escrow in compliance with the Purchase and Sale
Agreement dated as of November 22, 2000, as amended on December 4, 2000 and
November 1, 2001.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| |  | Goodwill- represents the cost in excess of fair value of the net assets
acquired in purchase transactions. Goodwill was amortized using the
straight-line method over 40 years and recorded net of accumulated
amortization. The Company discontinued recording the amortization of its
goodwill included in net assets held for sale subsequent to the filing of
the Bankruptcy Cases on December 5, 2000. Furthermore, the Company wrote
down $13.0 million of the asset as of December 6, 2001 due to the sale of
Fitzgeralds Black Hawk to Majestic.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| |  | Casino Revenue is the net win from gaming activities, which is the
difference between gaming wins and losses. Food and beverage and room
revenue includes the aggregate amounts generated by those departments at the
each of the Operating Properties.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

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| |  | Promotional Allowances- Operating revenues include the retail value of
rooms, food and beverage provided to customers without charge; corresponding
charges have been deducted from revenue in the accompanying consolidated
statements of operations as promotional allowances in the determination of
net operating revenues. The estimated costs of providing the complimentary
services are charged to the casino department and are as follows:
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                  |  |      |           |      |  |      |            |  |  |   |            | 
|----------------- |  | ---- | --------- | ---- |  | ---- | ---------- |  |  | - | ---------- | 
|                  |  | 2002 |           | 2001 |  | 2000
|                  |  |      |           |      |  |     
|Hotel             |  | $    | 700,232   |      |  | $    | 3,502,458  |  |  | $ | 3,067,565  | 
|Food and beverage |  |      | 2,637,412 |      |  |      | 13,199,027 |  |  |   | 13,389,226 | 
|Other             |  |      |          |      |  |      | 572,390    |  |  |   | 524,426    | 
|                  |  |      |           |      |  |      |            |  |  |   |            | 
|Total             |  | $    | 3,337,644 |      |  | $    | 17,273,875 |  |  | $ | 16,981,217 | 
|                  |  |      |           |      |  |      |            |  |  |   |            | 



| |  | Advertising Costs Advertising expenditures are expensed in the period the
advertising initially takes place. Advertising costs included in selling,
general and administrative expenses were $1,587,534, $4,696,846 and
$5,308,556 for the years ended December 31, 2002, 2001 and 2000,
respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | Federal Income Taxes The Company accounts for income taxes in accordance
with Statement of Financial Accounting Standards (SFAS) No. 109,
Accounting for Income Taxes, which requires recognition of deferred tax
assets and liabilities for the expected future tax consequences of events
that have been included in the financial statements or tax returns.
Deferred income taxes reflect the net tax effects of (a) temporary
differences between the carrying amounts of assets and liabilities for
financial reporting purposes and the amounts used for income tax purposes,
and (b) operating loss and tax credit carry forwards.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| |  | Financial Reporting Period- The Company has adopted a 4-4-5 (weeks)
financial reporting period which maintains a December 31 year-end. This
method of reporting results in 13 weeks in each quarterly accounting period.
The first and fourth accounting periods will have a fluctuating number of
days resulting from the maintenance of a December 31 year-end, whereas the
second and third periods will have the same number of days each year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| |  | Fair Value of Financial Instruments- The Company believes, based on current
information, that the carrying value of the Companys cash and cash
equivalents, restricted cash, accounts receivable, advances, and accounts
payable approximates fair value because of the short maturity of those
instruments. The Notes were trading at approximately 55% of the face value
at December 31, 2001. Due to the Companys bankruptcy filing, subsequent
sale of a substantial portion of its assets, interim payments on the
aggregate balance of accrued interest and principal on the Notes, as well as
delays encountered in selling the Companys remaining operating casino, the
Company believes it is no longer possible to accurately determine the fair
market value of its fixed debt obligations at December 31, 2002. The
Company is unable to estimate the fair value of its Preferred Stock since no
market quotes for such securities are readily available. The Company
estimates that the fair value of all other long-term debt approximates its
carrying value because interest rates on the debt approximate market rates.
|
| |  | Impairment of Long Lived Assets- The Company reviews long-lived assets and
certain identifiable intangibles for impairment whenever events or changes
in circumstances indicate that the carrying amount of an asset may not be
recoverable. During the 2001 year, Fitzgeralds Reno wrote-down $14.8
million in property and equipment to its estimated fair value.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|
| |  | Stock-Based Compensation- The Company utilizes SFAS No. 123, Accounting for
Awards of Stock-Based Compensationto account for stock-based employee
compensation plans and for transactions where equity securities are issued for goods and services. This statement defines
a fair value based method of accounting for an employee stock option or
similar equity instrument and encourages all entities to adopt                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

F - 13



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| |  | that method
of accounting for all of their employee stock compensation plans. However,
it also allows an entity to continue to measure compensation cost for those
plans using the intrinsic value based method of accounting prescribed by
Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock
Issued to Employees. In accounting for stock based employee compensation
plans, the Company applies APB Opinion No. 25, and adopted only the
disclosure requirement of SFAS No. 123.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | Recently Issued Accounting Pronouncements -In April 2002, the Financial
Accounting Standards Board (FASB) issued Statement of Financial Accounting
Standards No. 145 (SFAS 145), Rescission of FASB Statements No. 4, 44, and
64, Amendment of FASB Statement No. 13, and Technical Corrections.The most
significant provisions of this statement relate to the rescission of
Statement No. 4, Reporting Gains and Losses from Extinguishment of Debtand
it also amends other existing authoritative pronouncements to make various
technical corrections, clarify meanings, or describe their applicability
under changed conditions. Under this new statement, any gain or loss on
extinguishment of debt that was classified as an extraordinary item in prior
periods that does not meet certain defined criteria must be reclassified.
The provisions of this Statement, related to the rescission of Statement 4,
should be applied in fiscal years beginning after May 15, 2002. Generally,
SFAS 145 is effective for the Companys fiscal year 2003. Adoption of this
statement did not have a material impact on the Companys financial
condition or results of operation.                                                                             
|
| |  | In June 2002, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 146 (SFAS 146), Accounting
for Costs Associated with Exit or Disposal Activities.This statement
address financial accounting and reporting for costs associated with exit or
disposal activities and supercedes EITF No. 94-3 Liability Recognition for
Certain Employee Termination Benefits and Other Costs to Exit an Activity
(including Certain Costs Incurred in a Restructuring).The statement
requires that a liability for a cost associated with an exit or disposal
activity is recognized when the liability is incurred. A fundamental
conclusion reached by the FASB in SFAS 146 is than an entitys commitment to
a plan, by itself, does not create a present obligation to others that meets
the definition of a liability. This statement also establishes that fair
value is the objective for initial measurement of the liability. The
provisions of this statement are effective for exit or disposal activities
that are initiated after December 31, 2002 with early application
encouraged. Adoption of this statement did not have a material impact on
the Companys financial condition or results of operation.
|
| |  | In November 2002, the Financial Accounting Standards Board (FASB) issued
FASB Interpretation No 45 (FIN 45), Guarantors Accounting and Disclosure
Requirements for Guarantees, including indirect Guarantees of Indebtedness
of Others.FIN 45 expands the information disclosures required by
guarantors for obligations under certain types of guarantees. It also
requires initial recognition at fair value of a liability for such
guarantees. The initial recognition and initial measurement provisions of
this Interpretation are applicable on a prospective basis to guarantees
issued or modified after December 31, 2002, irrespective of the guarantors
fiscal year-end. The disclosure requirements in this Interpretation are
effective for financial statements of interim or annual periods ending after
December 15, 2002. The Company does not anticipate that the adoption of FIN
No. 45 will have a material impact on the consolidated financial statements.                                                                                                                                                                                                                                                                              
|
| |  | In December 2002, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 148 (SFAS 148), Accounting
for Stock-Based Compensation  Transition and Disclosure, an amendment of
FASB Statement No. 123to provide alternative methods of transition for a
voluntary change to the fair value based method of accounting for
stock-based employee compensation. In addition, SFAS No 148 amends the
disclosure requirements of SFAS No. 123 to require prominent disclosures in
both annual and interim financial statements about the method of accounting
for stock-based employee compensation and the effect of the method used on
reported results. The amendments to the transition and disclosure
provisions are effective for financial statements for fiscal
years ending after December 15, 2002 with early adoption encouraged. The
Company does not anticipate that the adoption of SFAS No. 148 will have a
material impact on the consolidated financial statements.                                                                                                                                                                                                                                  

F - 14



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|   |  | Bankruptcy Related Accounting The Company has accounted for all
transactions related to the Bankruptcy Cases in accordance with Statement of
Position 90-7 (SOP 90-7), Financial Reporting by Entities in
Reorganization Under the Bankruptcy Code, which was issued by the American
Institute of Certified Public Accountants in November 1990. Accordingly,
liabilities subject to compromise under the Bankruptcy Cases have been
segregated on the Consolidated Balance Sheet and are recorded for the
amounts that is expected to be allowed under the Restructuring Agreement
(see Note 2). In addition, the Consolidated Statements of Operations and
Consolidated Statements of Cash Flows for the period ended December 31, 2002
and December 31, 2001 disclose expenses related to the Bankruptcy Cases
under Reorganization Items. The Company will continue to present its Cash
Flow using the indirect method.
|-- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   |  | Use of Estimates- The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of certain assets
and liabilities at the date of the financial statements. These estimates
also affect the disclosure of contingent liabilities at the date of the
financial statement and the reported amounts of certain revenues and
expenses during the reporting period. Actual results could differ from those
estimates.                                                                                                                                                                                                                                                                                                                                                                                    
|  
|   |  | Reclassification Certain amounts in the 2001 and 2000 consolidated
financial statements have been reclassified to conform to the 2002 method of
presentation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|  
|4. |  | STATEMENTS OF CASH FLOWS INFORMATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|  
|   |  | The following supplemental disclosure is provided as part of the
consolidated statements of cash flows for the years ended December 31, 2002,
2001 and 2000:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|  
|   |  | Cash paid for interest, net of amounts capitalized, during the years ended
December 31, 2002, 2001 and 2000 was $237,542, $45,046,705 and $13,343,195,
respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|  
|   |  | Certain non-cash operating, investing and financing activities were as
follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|  
|   |  | Long-term contracts payable of $147,269 were incurred in 2002 and $2,618,420
were incurred in 2000. The acquisition in 2000 includes a parking garage
for Fitzgeralds Reno. In 2001, no additional new equipment was acquired
through long-term contracts payable.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|  
|   |  | During 2002, 2001 and 2000, accumulated deficit was increased by $8,650,409,
$7,496,002 and $6,443,648 for preferred stock dividends consisting of
$7,715,282, $6,658,852 and $5,747,076 and $935,127, $837,150 and $696,572
accretion of discount on preferred stock.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|  
|   |  | During 2000, additional paid-in-capital decreased by $278,709 due to the
expiration of the stock options.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|  
|   |  | See Note 2 and Note 6 for a summary of Assets Held for Sale and Liabilities
Subject to Compromise                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

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|5. |  | PROPERTY AND EQUIPMENT                                          
|-- |  | ----------------------------------------------------------------
|  
|   |  | Property and equipment consists of the following at December 31,

|                                               |  |      |             |      |  |      |             |   |  |           |            | 
|---------------------------------------------- |  | ---- | ----------- | ---- |  | ---- | ----------- | - |  | --------- | ---------- | 
|                                               |  |      |             |      |  |      |             |   |  | Estimated
|                                               |  |      |             |      |  |      |             |   |  | Service  
|                                               |  | 2002 |             | 2001 |  | Life
|                                               |  |      |             |      |  |     
|Land used in casino operations                 |  | $    | 4,555,894   |      |  | $    | 4,555,894   |   |  |           |           | 
|Buildings and improvements                     |  |      | 13,483,794  |      |  |      | 28,207,276  |   |  |           | 7-40 years
|Site improvements                              |  |      | 29,427      |      |  |      | 29,427      |   |  |           | 20 years  
|Furniture, fixtures and equipment              |  |      | 15,148,282  |      |  |      | 14,675,080  |   |  |           | 3-12 years
|                                               |  |      |             |      |  |      |             |   |  |           |            | 
|                                               |  |      | 33,217,397  |      |  |      | 47,467,677  |   |  |           |            | 
|Less write-down of assets                      |  |      |            |      |  |      | (14,764,341 | ) |  |           |            | 
|Less accumulated depreciation and amortization |  |      | (20,656,995 | )    |  |      | (20,672,939 | ) |  |           |            | 
|                                               |  |      |             |      |  |      |             |   |  |           |            | 
|                                               |  |      | 12,560,402  |      |  |      | 12,030,397  |   |  |           |            | 
|Construction in progress                       |  |      |            |      |  |      | 25,000      |   |  |           |            | 
|                                               |  |      |             |      |  |      |             |   |  |           |            | 
|                                               |  |      | 12,560,402  |      |  |      | 12,055,397  |   |  |           |            | 
|Less net assets held for sale                  |  |      | (12,490,263 | )    |  |      | (12,000,000 | ) |  |           |            | 
|                                               |  |      |             |      |  |      |             |   |  |           |            | 
|Total                                          |  | $    | 70,139      |      |  | $    | 55,397      |   |  |           |            | 
|                                               |  |      |             |      |  |      |             |   |  |           |            | 



|   |  | Total property and equipment at December 31, 2002 and 2001 is compromised of
furniture and fixtures for the Companys corporate offices. Substantially
all property and equipment is pledged as collateral on long-term debt.                                                                                                                                                                                                                                                                                                                                                                                                                 
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|6. |  | NET ASSETS HELD FOR SALE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|  
|   |  | On December 1, 2000, the Company entered into the Restructuring Agreement
with the Consenting Noteholders. The Restructuring Agreement contemplates
an expeditious and orderly sale of all of the Companys operating assets and
properties. The sale to Majestic was consummated on December 6, 2001. The
purchase price for substantially all of the Assets of Fitzgeralds Las Vegas,
Fitzgeralds Tunica, and Fitzgeralds Black Hawk properties was $149.0
million, subject to certain adjustments and holdbacks specified in the
purchase agreement, which resulted in net proceeds prior to distributions of
approximately $146.9 million.
|  
|   |  | As of December 31, 2002 and 2001 assets included in net assets held for sale
of $12.5 million and $12.0 million, respectively, consists mainly of
property and equipment transferable upon the sale of Fitzgerald Reno.                                                                                                                                                                                                                                                                                                                                                                                                                       
|  
|   | 

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|
|
|

|                                               |  |      |             |      |  |              |             |   |  |           |            | 
|---------------------------------------------- |  | ---- | ----------- | ---- |  | ------------ | ----------- | - |  | --------- | ---------- | 
|                                               |  |      |             |      |  |              |             |   |  | Estimated
|                                               |  | 2002 |             | 2001 |  | Service Life
|                                               |  |      |             |      |  |             
|Land used in casino operations                 |  | $    | 4,555,894   |      |  | $            | 4,555,894   |   |  |           |           | 
|Buildings and improvements                     |  |      | 13,483,794  |      |  |              | 28,207,276  |   |  |           | 7-40 years
|Site improvements                              |  |      | 29,427      |      |  |              | 29,427      |   |  |           | 20 years  
|Furniture, fixtures and equipment              |  |      | 14,880,974  |      |  |              | 14,452,856  |   |  |           | 3-12 years
|                                               |  |      |             |      |  |              |             |   |  |           |            | 
|                                               |  |      | 32,950,089  |      |  |              | 47,245,453  |   |  |           |            | 
|Write-down of asset                            |  |      |            |      |  |              | (14,764,341 | ) |  |           |            | 
|Less accumulated depreciation and amortization |  |      | (20,459,826 | )    |  |              | (20,506,112 | ) |  |           |            | 
|                                               |  |      |             |      |  |              |             |   |  |           |            | 
|                                               |  |      | 12,490,263  |      |  |              | 11,975,000  |  
|Construction in progress                       |  |      |            |      |  |              | 25,000      |   |  |           |            | 
|                                               |  |      |             |      |  |              |             |   |  |           |            | 
|Total                                          |  | $    | 12,490,263  |      |  | $            | 12,000,000  |   |  |           |            | 
|                                               |  |      |             |      |  |              |             |   |  |           |            | 



|7. |  | LONG TERM DEBT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   |  | The Notes bear interest at a fixed annual rate of 12.25% payable on June 15
and December 15 of each year, commencing June 15, 1998. The Notes stated
maturity date is on December 15, 2004. The Company has not paid the
regularly scheduled interest payments of $12.5 million that were due and
payable June 15, 1999. Under the Note Indenture, an Event of Default
occurred on July 15, 1999, and continued until the Company filed the
Bankruptcy Cases. Failure to make the scheduled interest payment on June
15, 1999 resulted in a 1.0% increase in the interest rate to 13.25%,
effective June 16, 1999 until the Company filed the Bankruptcy Cases. Upon
execution of the Restructuring Agreement and before commencement of the
Bankruptcy Cases, the Company distributed $13.0 million in Excess Cash (as
that term is defined in the Restructuring Agreement) to the Indenture
Trustee to be applied to unpaid and accrued Indenture Trustees fees and
expenses incurred and as partial payment of accrued and unpaid interest as
provided in the Indenture. Pursuant to the Restructuring Agreement and an
order entered by the Bankruptcy Court, the Company was required to
distribute unrestricted cash (which includes cash in net assets held for
sale) in excess of $24.8 million to holders of its Notes within 45 days
after the end of each quarter. In May, August and November 2001, the
Company distributed $1.8 million, $7.7 million and $7.2 million,
respectively, in Excess Cash to the Indenture Trustee to be applied to
accrued and unpaid interest and principal as provided in the Indenture. On
December 6, 2001, approximately $133.3 million was distributed to the
Indenture Trustee from the proceeds of the December 6, 2001 sale to
Majestic. The Company and the Informal Committee subsequently established a
new threshold for cash reserves of $16.5 million, which was approved by the
Bankruptcy Court on November 27, 2002 and effective
November 1, 2002. Upon obtaining approval from the
Bankrutpcy Court for the new threshold of $16.5 million, the Company
distributed $6.2 million to the Indenture Trustee to be applied to accrued
and unpaid interest and principal.

F - 17



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| |  | Long-term debt outstanding at December 31,
| |  | ------------------------------------------

|                                                                                                                                                                                    |  |   |             |   |      |   |             |   | 
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | - | ----------- | - | ---- | - | ----------- | - | 
|                                                                                                                                                                                    |  |   | 2002        |   | 2001
|                                                                                                                                                                                    |  |   |             |   |     
|The Notes; (net of unamortized discount of $288,154
in 2002 and $613,709 in 2001)                                                                                                   |  | $ | 93,217,781  |   |      | $ | 99,119,933  |  
|Note payable to acquire a parking garage secured by
the parking garage; monthly installments of $21,713,
including interest at 10.0% with final balloon payment
due February 2010   |  |   | 2,130,163   |   |      |   | 2,175,225   |  
|Contracts payable secured by certain equipment due
in maximum aggregate monthly installments of $5,500
and $40,792, with varying maturity dates through 2005 and 2006, respectively |  |   | 165,425     |   |      |   | 231,154     |  
|                                                                                                                                                                                    |  |   |             |   |      |   |             |  
|Total debt                                                                                                                                                                          |  |   | 95,513,369  |   |      |   | 101,526,312 |  
|Less liabilities subject to compromise                                                                                                                                              |  |   | (93,217,781 | ) |      |   | (99,119,933 | )
|Less net assets held for sale                                                                                                                                                       |  |   |            |   |      |   |            |  
|Less current portion                                                                                                                                                                |  |   | (121,946    | ) |      |   | (110,791    | )
|                                                                                                                                                                                    |  |   |             |   |      |   |             |  
|Long term debt                                                                                                                                                                      |  | $ | 2,173,642   |   |      | $ | 2,295,588   |  
|                                                                                                                                                                                    |  |   |             |   |      |   |             |  



| |  | The scheduled maturities of long-term debt are as follows for the year
ending December 31,
| |  | ------------------------------------------------------------------------------------------

|           |  |   |            | 
|---------- |  | - | ---------- | 
|2003       |  | $ | 121,946    | 
|2004       |  |   | 134,290    | 
|2005       |  |   | 77,713     | 
|2006       |  |   | 67,133     | 
|2007       |  |   | 74,140     | 
|Thereafter |  |   | 1,820,366  | 
|Unknown    |  |   | 93,217,781 | 
|           |  |   |            | 
|Total      |  | $ | 95,513,369 | 
|           |  |   |            | 

F - 18



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##### Table of Contents





|8. |  | COMMITMENTS                                                                                                                
|-- |  | ---------------------------------------------------------------------------------------------------------------------------
|  
|   |  | Future minimum rental payments under operating leases with non-cancelable
lease terms in excess of one year are as follows:

|                         |  |   |           | 
|------------------------ |  | - | --------- | 
|Year Ending December 31, |  |   |           | 
|2003                     |  | $ | 645,199   | 
|2004                     |  |   | 507,987   | 
|2005                     |  |   | 457,193   | 
|2006                     |  |   | 457,193   | 
|2007                     |  |   | 457,193   | 
|Thereafter               |  |   | 7,381,731 | 
|                         |  |   |           | 
|Total                    |  | $ | 9,906,496 | 
|                         |  |   |           | 



|    |  | Such operating lease commitments primarily relate to equipment, signs,
warehouses and ground leases on which the Companys buildings and equipment
reside. Rent expense for the years ended December 31, 2002, 2001 and 2000
was $865,484 and $2,133,291 and $2,797,177, respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    |  | Employment Agreements The Company has entered into employment agreements
with certain senior executives of the Company. In addition to their
respective salaries, the employment agreements also provide that such senior
executives will participate in the Companys executive compensation plans,
health plan and any other benefit plan established for selected officers of
the Company and that in the event of a termination of employment without
good cause (as defined in the agreements), such persons will be entitled
to any unpaid salary in a specified percentage through the remainder of the
term of their respective agreement.                                                                                                                                                                                                                                                                                                                                                                                       
|   
|    |  | Consistent with industry practice, the Company has entered into employment
agreements with certain of its other vice presidents and departmental
directors. In accordance with the Restructuring Agreement, the Company has
agreed not to assume these employment agreements as provided in Section 365
of the Bankruptcy Code.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   
|9.  |  | RELATED PARTY TRANSACTIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   
|    |  | In order to facilitate the winding down of its affairs, as well as the
orderly liquidation of assets and liabilities of the Company pursuant to the
filing of its bankruptcies, and after obtaining the Bankruptcy Court
approval the Company entered into a contract with Meritage Employer
Services, LLC (Meritage) on June 1, 2001 to assist in that process.
Meritage agreed to hire the 16 employees of the Companys risk management
department and to provide (1) health benefits design, claims processing and
administration services, (2) liability claims investigation and
administration services, (3) property and casualty insurance consulting and
(4) workers compensation claims processing and administration. The amount
of fees paid by the Company to Meritage for 2002 and 2001 totaled $579,233
and $604,800, respectively plus reimbursable expenses and deposits.
Meritage ownership is comprised of Senior Management, outside director, Phil
Hannifin, and a former executive of the Company, Kathleen Bryant.
|   
|10. |  | PROFIT SHARING PLAN                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   
|    |  | The Company has contributory profit-sharing plans for eligible employees.
The Companys contribution to the plans for any year, as determined by the
Board of Directors, is discretionary. Contributions to the plan
are allocated among eligible participants in the proportion of their
salaries to the total salaries of all participants.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

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|    |  | The Company amended the plans to include a 401(k) savings plan whereby
eligible employees may contribute up to 20% of their salary, which is
matched by the Company at 25 cents per employee dollar contributed, up to a
maximum of 6% of their salary. The Companys matching contributions were
$95,770, $340,674 and $346,377 for the years ended December 31, 2002, 2001
and 2000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    |  | Each employee age 21 or older completing 1,000 or more hours of service
during the twelve-month period preceding the entry dates, January 1, April
1, July 1 or October 1, is eligible to participate in the plans.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   
|    |  | In addition, the Company contributes to multi-employer defined contribution
pension plans under various union agreements. Contributions based on wages
paid to covered employees, were $342,172 and $351,847 for the years ended
December 31, 2001 and 2000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   
|11. |  | STOCKHOLDERS DEFICIENCY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   
|    |  | The Restructuring Agreement requires that all of the existing Common Stock
and Preferred Stock of the Company to be canceled and extinguished without
payment therefor. It is not expected that any distribution will be made to
holders of the existing capital stock of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   
|    |  | Preferred Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   
|    |  | As part of a public offering of $123.0 million senior secured notes (the
1995 Notes), the Company issued 800,000 shares of Preferred Stock with a
liquidation preference of $20 million ($25 per share), plus accrued and
unpaid dividends. Cash dividends on the Preferred Stock were payable out of
funds legally available therefor (when and if declared by the Companys
Board of Directors) in an amount equal to 15% of the liquidation preference.
Dividends not paid (whether or not declared) are cumulative from December
19, 1995 and compounded quarterly. The Indenture restricts the Companys
ability to pay dividends on the Preferred Stock, and the Company has no
current intention to pay any dividends on the Preferred Stock. The Preferred
Stock was redeemable by the Company at any time at a redemption price equal
to 100% of the liquidation preference plus accrued and unpaid dividends on
the date of redemption subject to restrictions in the Indenture. The Company
was obligated to redeem all of the Preferred Stock on December 31, 2005 at a
redemption price equal to 100% of the liquidation preference plus accrued
and unpaid dividends on the date of redemption. In the event that the
Company consummated a Qualified Public Offering (Qualified Public Offering
means a firm commitment underwritten public offering of Common Stock of the
Company for which the Company receives net proceeds of at least $25 million,
and after which the Common Stock is traded on a national securities exchange
or quoted on the Nasdaq National Market), it would have been required to
offer to repurchase 35% of the Preferred Stock at a price equal to 100% of
the liquidation preference on the date of repurchase. The Company has not
paid any cash dividends on its Preferred Stock and because of the Bankruptcy
Cases, the Bankruptcy Code and the Restructuring Agreement, the Company does
not anticipate paying any cash dividends. The Restructuring Agreement
requires and the New Plan provides that as part of the bankruptcy process, all of the existing
Preferred Stock is to be canceled and extinguished without any payment. It
is not expected that any distribution will be made to the holders of the
Preferred Stock.
|   
|    |  | Warrants and Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   
|    |  | As part of the offering of the 1995 Notes, the Company issued 2,675,237
warrants, each exercisable for one share of the Companys Common Stock at an
exercise price of $.01 per share (the Warrants). In connection with the
offering of the Notes and the repayment of the 1995 Notes, the Company
cancelled 703,402 of the Warrants. The remaining Warrants had an expiration
date of December 19, 1998. The Warrant Agent timely received notice of exercise for 1,495,236 Warrants and
476,599 Warrants expired. In September 1999, the Company issued 1,495,236
shares of Common Stock to exercising Warrant                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

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|    |  | holders in reliance on the
exemption from registration requirements contained in Section 4(2) of the
Securities Act of 1933 and on the basis that there was no public offering of
the Common Stock underlying the Warrants. The Company received $14,952,
representing the exercise price of the Warrants.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    |  | The Company has not paid any cash dividends on its Common Stock and because
of the Bankruptcy Cases, the Bankruptcy Code and the Restructuring Agreement
the Company does not anticipate paying any cash dividends. The
Restructuring Agreement requires and the New Plan provided that as part of the bankruptcy process, all
of the existing Common Stock is to be cancelled and extinguished without any
payment. It is not expected that any distribution will be made to the
holders of the Common Stock.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   
|    |  | Stock Options                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   
|    |  | Prior to the commencement of the Bankruptcy Cases, the Stock Option Plan was
administered by the Board of Directors or, at its discretion, by a committee
of the Board of Directors appointed for that purpose (the Stock Option Plan
Committee), which, subject to the terms of the Stock Option Plan, had the
authority in its sole discretion to interpret the Plan and to determine: (a)
the individuals to whom options shall be granted; (b) the time or times at
which options may be exercised; (c) the number of shares subject to each
option; (d) the option price and the duration of each option granted; and
(e) all of the other terms and conditions of options granted under the Stock
Option Plan. As of December 31, 2002 and 2001, no options were outstanding
under the Stock Option Plan. In accordance with the Bankruptcy Cases, the
Bankruptcy Code and the Restructuring Agreement, no additional options will
be granted under the Stock Option Plan and the Stock Option Plan will be
terminated during the pendency of the Bankruptcy Cases.
|   
|    |  | The exercise price of incentive stock options granted under the Stock Option
Plan was required to be at least equal to the fair market value of the
shares on the date of grant (110% of fair market value in the case of
participants possessing more than 10% of the combined voting power of the
Company or any of its subsidiaries) and was not permitted to have a term in
excess of 10 years from the date of grant (five years in the case of
participants possessing more than 10% of the combined voting power of the
Company). In no event could the aggregate fair market value (determined as
of the time the option is granted) of the shares with respect to which
incentive stock options (granted under the Stock Option Plan and all other
plans of the Company or any of its subsidiaries) were exercisable for the
first time by an optionee in any calendar year exceed $100,000.                                                                                                                                                                      
|   
|    |  | All stock options issued in prior years expired on December 31, 2000, with
no stock options exercised.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   
|13. |  | INCOME TAXES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   
|    |  | A reconciliation of the income tax benefit with amounts determined by
applying the statutory U.S. Federal income tax rate to consolidated loss
before taxes is as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

|                                             |  |      |            |      |  |      |            |   |  |   |            |  
|-------------------------------------------- |  | ---- | ---------- | ---- |  | ---- | ---------- | - |  | - | ---------- | -
|                                             |  | 2002 |            | 2001 |  | 2000
|                                             |  |      |            |      |  |     
|Tax benefit (expense) at U.S. statutory rate |  | $    | (1,864,293 | )    |  | $    | (1,511,107 | ) |  | $ | 6,399,031  |  
|(Increase) decrease in valuation allowance   |  |      | 1,814,877  |      |  |      | 1,479,599  |   |  |   | (6,387,636 | )
|Other                                        |  |      | 49,416     |      |  |      | 31,508     |   |  |   | (11,395    | )
|                                             |  |      |            |      |  |      |            |   |  |   |            |  
|Total                                        |  | $    |           |      |  | $    |           |   |  | $ |           |  
|                                             |  |      |            |      |  |      |            |   |  |   |            |  



| |  | The following summarizes the effect of deferred income tax items and the
impact of temporary differences between amounts of assets and liabilities
for financial reporting purposes and such amounts as measured by tax laws.
The tax items comprising the Companys net deferred tax asset as of December
31, 2002 are as follows:
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|                          |                                                   |   |          |         |            |   |             |            |  |   |             |            | 
|------------------------- | ------------------------------------------------- | - | -------- | ------- | ---------- | - | ----------- | ---------- |  | - | ----------- | ---------- | 
|                          |                                                   |   | Current  |         | Noncurrent |   | Total      
|                          |                                                   |   |          |         |            |   |            
|Deferred tax assets:      |                                                   |   |          |         |            |   |             |            |  |   |             |           
|                          | Accrued and other liabilities                     |   | $        | 166,576 |            |   | $           |           |  |   | $           | 166,576    | 
|                          | Bad debt reserve                                  |   |          | 8,544   |            |   |             |           |  |   |             | 8,544      | 
|                          | Difference between book and tax
basis of property |   |          |        |            |   |             | 2,362,079  |  |   |             | 2,362,079  | 
|                          | AMT/FICA credits not utilized                     |   |          |        |            |   |             | 661,946    |  |   |             | 661,946    | 
|                          | NOL carryforward                                  |   |          |        |            |   |             | 22,440,964 |  |   |             | 22,440,964 | 
|                          | Bond discount                                     |   |          |        |            |   |             | 1,889,092  |  |   |             | 1,889,092  | 
|                          | Other                                             |   |          |        |            |   |             |           |  |   |             |           | 
|                          |                                                   |   |          |         |            |   |             |            |  |   |             |            | 
|                          |                                                   |   | 175,120  |         |            |   | 27,354,081  |            |  |   | 27,529,201  |           
|                          |                                                   |   |          |         |            |   |             |            |  |   |             |            | 
|Deferred tax liabilities: |                                                   |   |          |         |            |   |             |            |  |   |             |           
|                          | Prepaid expenses                                  |   |          | 588,537 |            |   |             |           |  |   |             | 588,537    | 
|                          |                                                   |   |          |         |            |   |             |            |  |   |             |            | 
|                          |                                                   |   | 588,537  |         |            |   |            |            |  |   | 588,537     |           
|                          |                                                   |   |          |         |            |   |             |            |  |   |             |            | 
|                          |                                                   |   | (413,417 | )       |            |   | 27,354,081  |            |  |   | 26,940,664  |           
|Less: valuation allowance |                                                   |   | 413,417  |         |            |   | (27,354,081 | )          |  |   | (26,940,664 | )         
|                          |                                                   |   |          |         |            |   |             |            |  |   |             |            | 
|Net                       |                                                   | $ |         |         |            | $ |            |            |  | $ |            |           
|                          |                                                   |   |          |         |            |   |             |            |  |   |             |            | 



| |  | The tax items comprising the Companys net deferred tax asset as of December
31, 2001 are as follows:
| |  | -----------------------------------------------------------------------------------------------------

|                          |                                                   |   |          |         |            |   |             |            |  |   |             |            | 
|------------------------- | ------------------------------------------------- | - | -------- | ------- | ---------- | - | ----------- | ---------- |  | - | ----------- | ---------- | 
|                          |                                                   |   | Current  |         | Noncurrent |   | Total      
|                          |                                                   |   |          |         |            |   |            
|Deferred tax assets:      |                                                   |   |          |         |            |   |             |            |  |   |             |           
|                          | Accrued and other liabilities                     |   | $        | 236,070 |            |   | $           |           |  |   | $           | 236,070    | 
|                          | Bad debt reserve                                  |   |          | 17,150  |            |   |             |           |  |   |             | 17,150     | 
|                          | Difference between book and tax
basis of property |   |          |        |            |   |             | 2,323,718  |  |   |             | 2,323,718  | 
|                          | AMT/FICA credits not utilized                     |   |          |        |            |   |             | 715,015    |  |   |             | 715,015    | 
|                          | NOL carryforward                                  |   |          |        |            |   |             | 24,276,346 |  |   |             | 24,276,346 | 
|                          | Bond discount                                     |   |          |        |            |   |             | 1,929,495  |  |   |             |            | 
|                          | Other                                             |   |          |        |            |   |             | 55,948     |  |   |             | 55,948     | 
|                          |                                                   |   |          |         |            |   |             |            |  |   |             |            | 
|                          |                                                   |   | 253,220  |         |            |   | 29,300,522  |            |  |   | 29,553,742  |           
|                          |                                                   |   |          |         |            |   |             |            |  |   |             |            | 
|Deferred tax liabilities: |                                                   |   |          |         |            |   |             |            |  |   |             |           
|                          | Prepaid expenses                                  |   |          | 772,360 |            |   |             |           |  |   |             | 772,360    | 
|                          |                                                   |   |          |         |            |   |             |            |  |   |             |            | 
|                          |                                                   |   | 772,360  |         |            |   |            |            |  |   | 772,360     |           
|                          |                                                   |   |          |         |            |   |             |            |  |   |             |            | 
|                          |                                                   |   | (519,140 | )       |            |   | 29,300,522  |            |  |   | 28,781,382  |           
|Less: valuation allowance |                                                   |   | 519,140  |         |            |   | (29,300,522 | )          |  |   | (28,781,382 | )         
|                          |                                                   |   |          |         |            |   |             |            |  |   |             |            | 
|Net                       |                                                   | $ |         |         |            | $ |            |            |  | $ |            |           
|                          |                                                   |   |          |         |            |   |             |            |  |   |             |            | 



| |  | Due to the uncertainty of the realization of certain tax carry forward
items, a valuation allowance has been established in the amount of $28.8
million at December 31, 2001. Realization of a significant portion of the
assets offset by the valuation allowance is dependent on the Company
generating sufficient taxable income prior to expiration of the loss and
credit carry forwards.
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | As of December 31, 2002, the Company had a consolidated net operating loss
carry forward of                                                                                                                                                                                                                                                                                                   

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|    |  | approximately $64,000,000 million and a tax credit carry
forward of $660,000 million, which are available to offset future tax through
2022. The availability of the loss and credit carry forwards may be subject
to limitations under sections 382 and 383 of the Internal Revenue Code in
the event of a significant change of ownership.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|14. |  | CONTINGENCIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   
|    |  | Financial Instruments With Off-Balance Sheet RiskIn the normal course of
business, the Company is a party to financial instruments with off-balance
sheet risk which are not reflected in the accompanying consolidated balance
sheets.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   
|    |  | The Company has an irrevocable letter of credit with a bank in the amount of
$208,000 that expires on November 1, 2003 and may be drawn upon by the State
of Nevada Insurance Division in the event that Fitzgeralds Reno, Nevada Club
or Fitzgeralds Las Vegas fails to pay workers compensation benefits to its
employees under a self-insurance program. The letter of credit is secured
with a certificate of deposit for $208,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   
|    |  | The Company has an irrevocable letter of credit with an insurance company in
the amount of $600,000 which expires on October 13, 2003 and serves as
collateral for a $2.5 million surety bond, enabling the Company to remain a
participant in the State of Nevada self-insured workers compensation
program. The letter of credit is secured with a certificate of deposit for
$600,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   
|    |  | The Company has irrevocable letters of credit with a bank in the amount of
$430,000 and $640,822. Such letters, which expire on March 31, 2003 and
April 1, 2003, respectively, may be drawn by an insurance company in the
event that Fitzgeralds Tunica or Fitzgeralds Black Hawk fails to pay
workers compensation benefits to its employees. The letters of credit are
secured with certificates of deposit for $430,000 and $640,822.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   
|    |  | At December 31, 2002, no amounts were drawn on the above investment or
letters of credit, and management does not expect any adverse effects on the
Companys operating results.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   
|    |  | Holiday Inn-Upon notification by Majestic of its intent to not enter into
a new franchise agreement with Holiday Inn Franchising, Inc. (Inn), the
Company filed a motion with the Bankruptcy Court on October 26, 2001 to
remove its pre-petition franchise and other agreements with Inns from the
list of agreements to be assumed and assigned to Majestic. On October 26,
2001, the Bankruptcy Court granted the motion. On or about July 9, 2002,
the Bankruptcy Court entered an order granting the Companys motion for an
order authorizing the rejection of the franchise agreement. Inn disagreed
with the rejection and subsequently filed an unsecured claim in Bankruptcy
Court based upon the liquidated damage provision of the franchise agreement
for $1.8 million. While the Company is contesting the allowance of such a
claim by the Bankruptcy Court, the Company cannot predict the Bankruptcy
Courts ultimate resolution of such a claim.
|   
|    |  | Jerome H. Turk a former officer and shareholder of the Company filed a
$782,551 unsecured claim in Bankruptcy Court for breach of contract
concerning premium payments due to him on a split dollar life insurance
policy purchased by him personally pursuant to a former employment contract
with the Company. While the Company is contesting the allowance of such as
claim by the Bankruptcy Court, the Company can not predict the Bankruptcy
Courts ultimate resolution of such a claim                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   
|    |  | Legal Matters                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   
|    |  | Reno Transportation Rail Access Corridor (ReTRAC) Project- In October 1998,
the Reno City Council approved a special assessment district to finance a
portion of the costs to lower the railroad tracks that run through downtown
Reno, Nevada (the ReTRAC Project). Plans for the ReTRAC Project provide
for the construction of a temporary rail bypass that will be used to divert
rail traffic around the main railroad                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

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| |  | during construction. The City of Reno
(the City) estimates that a period of more than three years will be
required to complete the ReTRAC Project. The southern boundary of the
bypass will extend out into the middle of Commercial Row, the street where
Fitzgeralds Reno hotel entrance, valet parking area and hotel loading zone
are situated.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | Based on plans prepared by the City, Fitzgeralds Reno would expect to lose
permanently approximately 3,802 square feet of land and temporarily 22,979
square feet of land through eminent domain, several parking spaces, the
current valet parking area, an outdoor billboard structure advertising
available rooms and a building used to house administrative offices, and may
be required to relocate the hotel entrance currently on Commercial Row. The
City has also indicated that the ReTRAC Project might require the demolition
of the Fitzgeralds Reno Rainbow Skyway if underpinning during construction
of the ReTRAC Project cannot preserve the structure. Implementation of the
ReTRAC Project under these circumstances would cause the Company to suffer
significant and permanent loss in business revenue and income; certain
operating efficiencies from demolished or impaired physical structures; and
a portion of its existing customer base as a result of the construction and
operation of the proposed rail bypass.                                                                                                                                                                                                                                 
|
| |  | On November 30, 1998, the Company filed a lawsuit against the City to
challenge the method by which the special assessment to be levied against
the Company was determined. The City of Reno filed an answer to the
Companys lawsuit on January 19, 1999. Subsequent thereto, George Karadanis
and Robert Maloff d/b/a Sundowner Hotel and Casino (the Sundowner) were
permitted by court order to file a Complaint in Intervention.
Notwithstanding that intervention, on December 22, 1999, the court granted
the City of Renos Motion for Summary Judgment against the Sundowner which
motion was joined in by the Company. After hearing oral arguments and
considering the parties briefs, the Court concluded that there was
insufficient evidence before the Reno City Council to support a finding that
the ReTRAC Project confers a special benefit on Fitzgeralds Reno as is
required by statute before a special assessment may be imposed. The Court
remanded the matter to the Reno City Council and directed the council to
conduct a new hearing to consider evidence as to whether Fitzgeralds Reno
would receive a special benefit from the proposed project.                                                                                               
|
| |  | On June 20, 2001, the Reno City Council commenced a public hearing in
compliance with the remand order of the Court. That public hearing was
recessed and continued to November 29, 2001. After
resuming the hearing on November 29, 2001, the Reno City Council again
recessed and continued the proceedings to January 4, 2002, at which time the
hearing was completed and the matter was submitted for decision of the Reno
City Council. On February 19, 2002, the Reno City Council voted on the
matter. By a 4-3 decision, the Reno City Council concluded that the ReTRAC
Project would confer a special benefit on Fitzgeralds Reno. On a 5-2
decision, however, the Reno City Council determined that the value of the
special benefit in light of the evidence presented was $1.00.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| |  | On February 27, 2001, the Reno City Council voted to continue the process of
determining the actual cost of construction of the ReTRAC Project, which the
City has recently estimated to be $282 million. On May 24, 2001,
Fitzgeralds Reno commenced an action, CV-N-01-0329-PMP-RAM, in the United
States District Court for the District of Nevada, against the Federal
Highway Administration (FHWA), the Nevada Department of Transportation
(NDOT), and the City (collectively, the Defendants) for violations of
the National Environmental Policy Act (NEPA), codified at 42 U.S.C. §§
4321-4327. The claims against all Defendants allege a violation of 42
U.S.C. § 4332 (Violation of NEPA: Failure to Consider Reasonable
Alternatives & Failure to Consider and Provide Adequate Mitigation
Measures). Specifically, Fitzgeralds Reno asserts the Defendants failed to
consider the Partial Cover and Cut Tunnel Alternative and the use of the
Feather River Route on a temporary basis, and failed to include a plan for
mitigating the adverse environmental impacts, including construction
disruption, loss of operating facilities, noise and vibration impacts, that
will be caused by the ReTRAC Project and incurred by Fitzgeralds Reno and
others.

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| |  | On or about June 12, 2001, NDOT filed a motion to dismiss the Companys NEPA
complaint based on a claim of sovereign immunity and the Company moved to
amend its complaint to substitute as a defendant the Director of NDOT,
Thomas E. Stephens, for the Defendant NDOT, in lieu of considering NDOTs
Eleventh Amendment immunity claim. This unopposed motion was granted by the
Court on August 17, 2001, and the Company filed its amended complaint on
August 23, 2001. Defendant FHWA filed its answer to the Complaint on
September 6, 2001 and Defendant Stephens filed his answer on October 3,
2001. The City filed a motion to dismiss the amended complaint so far as it
named the City as defendant on September 6, 2001. On February 15, 2002, the
United States District Court held a hearing to consider the Citys motion to
dismiss. At the hearing, the Defendant FHWA and the Defendant NDOT joined
the Citys motion to dismiss. The Citys motion to dismiss was fully argued
and submitted to the Court for a ruling. On March 11, 2002, the Court
issued an order dismissing all of the Companys claims against the City.
The Court ruled the ReTRAC Project must comply with NEPA but the specific
federal aid statute under which the City is receiving funding for the ReTRAC
Project does not explicitly require the local government body to consent to
suit under NEPA. Accordingly, the Court found the City was not a proper
party in the case. The Court, however, denied the motions to dismiss by
FHWA and NDOT stating the Company is entitled to proceed on the claims
against those agencies for a violation of NEPA. The remaining parties 
Fitzgeralds Reno, FHWA and NDOT  filed cross motions for summary judgment
on December 23, 2002. These parties oppositions to the respective cross
motions for summary judgment were filed on February 18, 2003. The cross
motions for summary judgment was orally argued on February 26, 2003. On
March 6, 2003, Judge Pro entered an order and judgment dismissing
Fitzgeralds Renos claim against the FHWA and NDOT on the grounds the claims
raised did not satisfy the applicable arbitrary and capricious standard
under NEPA and only alleged generalized and speculative environmental
harms. The Company is evaluating its legal options concerning the Courts
decision and judgment.
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | The City completed its construction cost analysis in July 2002.
Construction contracts for the ReTRAC Project were awarded by the City
Council on July 16, 2002. Preliminary construction activities have
commenced and on February 25, 2003, the City Council adopted a resolution of
intent to commence in the future eminent domain proceedings against the
Company to acquire from Fitzgeralds Reno fee title to approximately 3,802
square feet of land and a 4,524 square foot administrative office building
owned and used by the Company, as well as temporary easements for
approximately 22,979 square feet of land to facilitate construction of the
ReTRAC Project. The Company also is discussing with the City certain
federal government benefits for the relocation and displacement of
businesses in connection with the ReTRAC Project.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|
| |  | Other Litigation- The Company is a party to various lawsuits relating to
routine matters incidental to its business. Except as noted below, the
Company does not believe that the outcome of such litigation, individually
or in the aggregate, will have any material adverse effect on its financial
condition.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|
| |  | Reliance- From April 1, 1998 through September 30, 1999, the Companys
general liability insurance and workers compensation insurance carrier was
Reliance Insurance Company (Reliance). On May 29, 2001, a Pennsylvania
court placed Reliance under the control of the Pennsylvania Insurance
Department for rehabilitation. Thereafter, on October 3, 2001, the Reliance
Insurance Company was declared insolvent and placed under an order of
liquidation by the Pennsylvania Commonwealth Court at the request of the
Pennsylvania Insurance Department. The Pennsylvania Insurance Department is
now referring claims incurred in Mississippi, Nevada and Colorado from April
1, 1998 through September 30, 1999 to the Mississippi Insurance Guaranty
Association, the Nevada Insurance Guaranty Association and the Colorado
Insurance Guaranty Association, respectively. Each states Guaranty
Insurance Association will investigate the claims incurred in their
jurisdictions to determine if any of these claims are eligible for any
insurance coverage under the respective Insurance Guaranty Association. The
Company has not incurred any material amounts for liability claims or
workers compensation claims that would be subject to reimbursement by
Reliance. However, the statute of limitation has not expired for filing
claims and it is unclear at this time what the insurance coverage would be
from Reliance, if any, in the event that a future                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

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|    |  | claim is filed that would
be large enough to result in an insurance reimbursement from Reliance or any
state Insurance Guaranty Association, or if there is insurance coverage for
an existing claim that is currently under the threshold level for
reimbursement, but increases in the future to an amount eligible for
reimbursement. The reimbursement threshold per claim is $25,000 and
$100,000 for liability claims and worker compensation claims, respectively.
At the present time, the Company is unable to determine what effect this
action may have on liability and workers compensation claims which arose
during the coverage period for which Reliance was the Companys insurance
carrier or whether any limitations on coverage would have a material adverse
effect on the Companys financial condition.
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|15. |  | SEGMENT INFORMATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   
|    |  | The Company is a gaming holding company that until December 6, 2001 owned
and operated four Fitzgeralds-brand casino-hotels, in downtown Las Vegas,
Nevada, Reno, Nevada, Tunica, Mississippi, and Black Hawk, Colorado. On
December 6, 2001, the Company sold substantially all of the Assets of
Fitzgeralds Las Vegas, Fitzgeralds Tunica and Fitzgeralds Black Hawk to
Majestic. The Company identified its business in four segments based on
geographic location. The Company markets its Reno segment primarily to
middle-market customers, emphasizing its Fitzgeralds brand and its
Fitzgeralds Irish Luck theme. The major products offered in each segment
are: casino and hotel (except for Fitzgeralds Black Hawk) and food and
beverage.                                                                         
|   
|    |  | The accounting policies of each business segment are the same as those
described in the summary of significant accounting policies. There are
minimal inter-segment sales. Corporate costs are allocated to the business
segments through management fees.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   
|    |  | Assets are principally cash and cash equivalents and property and equipment.
No single customer accounts for more than 10% of revenue.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   
|    |  | A summary of the Companys operations by business segment for 2002, 2001 and
2000 is presented below:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

|                                   |                            |                  |        |                         |        |      |         |         |        |   |         |        |        | 
|---------------------------------- | -------------------------- | ---------------- | ------ | ----------------------- | ------ | ---- | ------- | ------- | ------ | - | ------- | ------ | ------ | 
|                                   |                            |                  |        | Year Ended December 31,
|                                   |                            |                  |        |                        
|                                   |                            |                  |        | 2002                    |        | 2001 |         | 2000   
|                                   |                            |                  |        |                         |        |      |         |        
|                                   |                            |                  |        | (in thousands)         
|Net operating revenues:            |                            |                  |        |                         |        |      |         |         |        |   |         |       
|                                   | Fitzgeralds Las Vegas      |                  | $      |                        |        |      | $       | 49,440  |        |   | $       | 52,139 |       
|                                   | Fitzgeralds Tunica         |                  |        |                        |        |      |         | 76,713  |        |   |         | 75,062 |       
|                                   | Fitzgeralds Reno           |                  |        | 36,967                  |        |      |         | 38,333  |        |   |         | 40,241 |       
|                                   | Fitzgeralds Black Hawk     |                  |        |                        |        |      |         | 31,511  |        |   |         | 32,506 |       
|                                   | Other                      |                  |        | 34                      |        |      |         | 34      |        |   |         | 154    |       
|                                   |                            |                  |        |                         |        |      |         |         |        |   |         |       
|Total                              |                            | $                | 37,001 |                         |        | $    | 196,031 |         |        | $ | 200,102 |       
|                                   |                            |                  |        |                         |        |      |         |         |        |   |         |        |       
|Income (loss) from operations (1): |                            |                  |        |                         |        |      |         |         |        |   |         |       
|                                   | Fitzgeralds Las Vegas      |                  | $      | (223                    | )      |      | $       | (24,040 | )      |   | $       | (7     | )     
|                                   | Fitzgeralds Tunica         |                  |        | (213                    | )      |      |         | 41,972  |        |   |         | 9,018  |       
|                                   | Fitzgeralds Reno (2)       |                  |        | 1,909                   |        |      |         | (11,796 | )      |   |         | 2,716  |       
|                                   | Fitzgeralds Black Hawk (3) |                  |        | (486                    | )      |      |         | 7,224   |        |   |         | 6,385  |       
|                                   | Other                      |                  |        | (5,104                  | )      |      |         | (3,317  | )      |   |         | (3,581 | )     
|                                   |                            |                  |        |                         |        |      |         |         |        |   |         |        |       
|                                   |                            | Total Properties |        |                         | (4,117 | )    |         |         | 10,043 |   |         |        | 14,531 | 
|                                   | Nevada Club                |                  |        | 3                       |        |      |         | (74     | )      |   |         | (50    | )     
|                                   |                            |                  |        |                         |        |      |         |         |        |   |         |        |       
|Total                              |                            | $                | (4,114 | )                       |        | $    | 9,969   |         |        | $ | 14,481  |       
|                                   |                            |                  |        |                         |        |      |         |         |        |   |         |        |       

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

|                                                 |                                                  |   |                         |        |      |   |        |         |   |   |         |         |  
|------------------------------------------------ | ------------------------------------------------ | - | ----------------------- | ------ | ---- | - | ------ | ------- | - | - | ------- | ------- | -
|                                                 |                                                  |   | Year Ended December 31,
|                                                 |                                                  |   |                        
|                                                 |                                                  |   | 2002                    |        | 2001 |   | 2000  
|                                                 |                                                  |   |                         |        |      |   |       
|                                                 |                                                  |   | (in thousands)         
|                                                 | Total segment operating income                   |   | $                       | 987    |      |   | $      | 13,356  |   |   | $       | 18,112  |  
|                                                 | Nevada Club                                      |   |                         | 3      |      |   |        | (74     | ) |   |         | (50     | )
|                                                 | Other (4)                                        |   |                         | (5,104 | )    |   |        | (7,313  | ) |   |         | (7,581  | )
|                                                 | Eliminations                                     |   |                         | (795   | )    |   |        | (11,773 | ) |   |         | 11,572  |  
|                                                 | Interest income                                  |   |                         | 67     |      |   |        | 155     |   |   |         | 1,040   |  
|                                                 | Interest
income - shareholder and inter-company  |   |                         |       |      |   |        | 1,504   |   |   |         | 29,659  |  
|                                                 | Interest expense                                 |   |                         | (1,274 | )    |   |        | (4,682  | ) |   |         | (31,843 | )
|                                                 | Interest
expense - shareholder and inter-company |   |                         |       |      |   |        |        |   |   |         | (29,586 | )
|                                                 | Loss on sale of assets                           |   |                         | (6     | )    |   |        | (3,030  | ) |   |         | (50     | )
|                                                 | Other income (expense)                           |   |                         | 795    |      |   |        | 16,174  |   |   |         | (7,659  | )
|                                                 |                                                  |   |                         |        |      |   |        |         |   |   |         |        
|Net income (loss) before income tax              |                                                  | $ | (5,327                  | )      |      | $ | 4,317  |         |   | $ | (16,386 | )      
|                                                 |                                                  |   |                         |        |      |   |        |         |   |   |         |        
|Segment depreciation and amortization:           |                                                  |   |                         |        |      |   |        |         |   |   |         |        
|                                                 | Fitzgeralds Las Vegas                            |   | $                       |       |      |   | $      |        |   |   | $       | 3,698   |  
|                                                 | Fitzgeralds Tunica                               |   |                         |       |      |   |        |        |   |   |         | 6,235   |  
|                                                 | Fitzgeralds Reno                                 |   |                         |       |      |   |        |        |   |   |         | 2,231   |  
|                                                 | Fitzgeralds Black Hawk                           |   |                         |       |      |   |        |        |   |   |         | 1,755   |  
|                                                 | Other                                            |   |                         | 30     |      |   |        | 34      |   |   |         | 59      |  
|                                                 |                                                  |   |                         |        |      |   |        |         |   |   |         |         |  
|Total                                            |                                                  | $ | 30                      |        |      | $ | 34     |         |   | $ | 13,978  |        
|                                                 |                                                  |   |                         |        |      |   |        |         |   |   |         |         |  
|Segment assets:                                  |                                                  |   |                         |        |      |   |        |         |   |   |         |        
|                                                 | Fitzgeralds Las Vegas                            |   | $                       | 171    |      |   | $      | 1,530   |   |   | $       | 42,657  |  
|                                                 | Fitzgeralds Tunica                               |   |                         | 98     |      |   |        | 764     |   |   |         | 65,943  |  
|                                                 | Fitzgeralds Reno                                 |   |                         | 18,559 |      |   |        | 18,007  |   |   |         | 34,579  |  
|                                                 | Fitzgeralds Black Hawk                           |   |                         | 94     |      |   |        | 1,027   |   |   |         | 38,728  |  
|                                                 | Other                                            |   |                         | 16,544 |      |   |        | 30,044  |   |   |         | 6,141   |  
|                                                 |                                                  |   |                         |        |      |   |        |         |   |   |         |         |  
|Total                                            |                                                  | $ | 35,466                  |        |      | $ | 51,372 |         |   | $ | 188,048 |        
|                                                 |                                                  |   |                         |        |      |   |        |         |   |   |         |         |  
|Expenditures for additions to long-lived assets: |                                                  |   |                         |        |      |   |        |         |   |   |         |        
|                                                 | Fitzgeralds Las Vegas                            |   | $                       |       |      |   | $      | 249     |   |   | $       | 1,619   |  
|                                                 | Fitzgeralds Tunica                               |   |                         |       |      |   |        | 627     |   |   |         | 6,199   |  
|                                                 | Fitzgeralds Reno                                 |   |                         | 349    |      |   |        | 730     |   |   |         | 4,103   |  
|                                                 | Fitzgeralds Black Hawk                           |   |                         |       |      |   |        | 178     |   |   |         | 1,518   |  
|                                                 | Other                                            |   |                         | 45     |      |   |        | 31      |   |   |         | 25      |  
|                                                 |                                                  |   |                         |        |      |   |        |         |   |   |         |         |  
|Total                                            |                                                  | $ | 394                     |        |      | $ | 1,815  |         |   | $ | 13,464  |        
|                                                 |                                                  |   |                         |        |      |   |        |         |   |   |         |         |  



---

|(1) |  | Includes loss on sale of assets of $25.3 million for Fitzgeralds
Las Vegas and a gain on sale of assets of $24.1 million and $12.7
million for Fitzgeralds Tunica and Fitzgeralds Black Hawk,
respectively to Majestic in 2001. Such gains and losses are included
in Reorganization items.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Includes write down of assets of $14.8 million in 2001 at
Fitzgeralds Reno.                                                                                                                                                                                                                

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|(3) |  | Includes write down of assets of $13.0 million in 2001 at
Fitzgeralds Black Hawk.                                                                                                                                                                                                                                                                                                                                                      
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(4) |  | Other includes (i) corporate expenses not allocated to the
Operating Properties for all periods presented, which include $3.2
million of pre-petition professional fees and expenses incurred with
the Companys restructuring for 2000 and $1.8 million, $3.5 million
and $0.1 million of post-petition professional fees and expenses, net
of interest income included in reorganization items for 2002, 2001 and
2000, respectively.



|16. |  | GUARANTEE OF THE NOTES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    |  | The Companys obligations under the Notes are fully and unconditionally
guaranteed, jointly and severally, by all subsidiaries of the Company (other
than NCI). Subject to certain exceptions, the guarantee of the Notes is
secured by a lien on substantially all assets of the Guarantor Subsidiaries
other than certain excluded assets, as defined. Such excluded assets
include, among other things, (i) cash, deposit accounts and other cash
equivalents of $14,525,165 and $25,608,202 at December 31, 2002 and 2001,
respectively; (ii) property and equipments with a net book value of
$2,926,656 and $3,203,237 at December 31, 2002 and 2001, respectively,
securing certain non-recourse indebtedness; and (iii) any agreements,
permits, licenses or the like that cannot be subjected to a lien without the
consent of third parties, which consent is not obtainable by the Company
(including all gaming licenses of the Company and its restricted
subsidiaries as defined), provided that excluded assets do not include the
proceeds of the assets under clauses (ii) or (iii) or any other collateral
to the extent such proceeds do not constitute excluded assets under clause
(i) above. On December 6, 2001, the Company sold substantially all of the
Assets of Fitzgeralds Las Vegas, Fitzgeralds Tunica and Fitzgeralds Black
Hawk to Majestic.

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Condensed consolidating financial statement information for Fitzgeralds Gaming
Corporation, the Guarantor Subsidiaries, the Non-Guarantor Subsidiaries and
Eliminating Entries (which consist principally of the elimination of
inter-company loan and investment accounts) follows:

Condensed consolidating balance sheet information as of December 31, 2002:

|                                         |                                     |                           |              |             |            |              |             |              |           |             |    |    |    |   |              |              |             |     |  |  |  |   |              |            |            | 
|---------------------------------------- | ----------------------------------- | ------------------------- | ------------ | ----------- | ---------- | ------------ | ----------- | ------------ | --------- | ----------- | -- | -- | -- | - | ------------ | ------------ | ----------- | --- |  |  |  | - | ------------ | ---------- | ---------- | 
|                                         |                                     |                           |              | Fitzgeralds |            |              |             |              |           | Non         |    |    |    |   |              |              |             |     |  |  |  |  
|                                         |                                     |                           |              | Gaming      |            | Guarantor    |             | Guarantor    |           | Eliminating |    |    |    |   |              | Consolidated
|                                         |                                     |                           |              | Corporation |            | Subsidiaries |             | Subsidiaries |           | Entries     |    |    |    |   |              | Total       
|                                         |                                     |                           |              |             |            |              |             |              |           |             |    |    |    |   |              |             
|ASSETS                                   |                                     |                           |              |             |            |              |             |              |           |             |    |    |    |   |              |              |             |     |  |  |  |   |              |           
|CURRENT ASSETS:                          |                                     |                           |              |             |            |              |             |              |           |             |    |    |    |   |              |              |             |     |  |  |  |   |              |           
|                                         | Cash and cash equivalents           |                           | $            | 10,518,030  |            |              | $           | 4,007,135    |           |             | $  | 83 |    |   | $            |             |             |     |  |  |  |   | $            | 14,525,248 |           
|                                         | Accounts and notes receivable, net  |                           |              | 83          |            |              |             | 357,113      |           |             |    |   |    |   |              |             |             |     |  |  |  |   |              | 357,196    |           
|                                         | Inventories                         |                           |              |            |            |              |             | 464,550      |           |             |    |   |    |   |              |             |             |     |  |  |  |   |              | 464,550    |           
|                                         | Prepaid and other current assets    |                           |              | 178,015     |            |              |             | 1,275,790    |           |             |    |   |    |   |              |             |             |     |  |  |  |   |              | 1,453,805  |           
|                                         |                                     |                           |              |             |            |              |             |              |           |             |    |    |    |   |              |              |             |     |  |  |  |   |              |           
|                                         |                                     | Total current assets      |              |             | 10,696,128 |              |             |              | 6,104,588 |             |    |    | 83 |   |              |              |            |     |  |  |  |   |              |            | 16,800,799 | 
|PROPERTY AND EQUIPMENT, NET              |                                     |                           | 70,139       |             |            |              |            |              |           |             |   |    |    |   |             |              |             |     |  |  |  |   | 70,139       |           
|NET ASSETS HELD FOR SALE                 |                                     |                           |             |             |            |              | 12,490,263  |              |           |             |   |    |    |   |              |              |             |     |  |  |  |   | 12,490,263   |           
|OTHER ASSETS                             |                                     |                           | 53,020,500   |             |            |              | 34,179,271  |              |           |             |   |    |    |   | (81,094,862  | )            | (b)         |     |  |  |  |   | 6,104,909    |           
|                                         |                                     |                           |              |             |            |              |             |              |           |             |    |    |    |   |              |              |             |     |  |  |  |   |              |           
|TOTAL                                    |                                     | $                         | 63,786,767   |             |            | $            | 52,774,122  |              |           | $           | 83 |    |    | $ | (81,094,862  | )            |             |     |  |  |  | $ | 35,466,110   |           
|                                         |                                     |                           |              |             |            |              |             |              |           |             |    |    |    |   |              |              |             |     |  |  |  |   |              |           
|LIABILITIES AND STOCKHOLDERS DEFICIENCY |                                     |                           |              |             |            |              |             |              |           |             |    |    |    |   |              |              |             |     |  | 
|CURRENT LIABILITIES:                     |                                     |                           |              |             |            |              |             |              |           |             |    |    |    |   |              |              |             |     |  |  |  |   |              |           
|                                         | Current portion of long-term debt   |                           | $            |            |            |              | $           | 121,946      |           |             | $  |   |    |   | $            |             |             |     |  |  |  |   | $            | 121,946    |           
|                                         | Accounts payable, accrued and other |                           |              | 16,057,629  |            |              |             | 4,757,675    |           |             |    | 83 |    |   |              | (17,426,444  | )           | (a) |  |  |  |   |              | 3,388,943  |           
|                                         |                                     |                           |              |             |            |              |             |              |           |             |    |    |    |   |              |              |             |     |  |  |  |   |              |           
|                                         |                                     | Total current liabilities |              |             | 16,057,629 |              |             |              | 4,879,621 |             |    |    | 83 |   |              |              | (17,426,444 | )   |  |  |  |   |              |            | 3,510,889  | 
|                                         |                                     |                           |              |             |            |              |             |              |           |             |    |    |    |   |              |              |             |     |  |  |  |   |              |           
|LONG TERM DEBT, Net of current portion   |                                     |                           |             |             |            |              | 2,173,642   |              |           |             |   |    |    |   |             |              |             |     |  |  |  |   | 2,173,642    |           
|LIABILITIES SUBJECT TO COMPROMISE        |                                     |                           | 107,250,025  |             |            |              | 104,165,814 |              |           |             |   |    |    |   | (119,426,501 | )            | (a)         |     |  |  |  |   | 91,989,338   |           
|                                         |                                     |                           |              |             |            |              |             |              |           |             |    |    |    |   |              |              |             |     |  |  |  |   |              |           
|                                         | Total liabilities                   |                           |              | 123,307,654 |            |              |             | 111,219,077  |           |             |    | 83 |    |   |              | (136,852,945 | )           |     |  |  |  |   |              | 97,673,869 |           
|CUMULATIVE REDEEMABLE
PREFERRED STOCK    |                                     |                           | 52,552,570   |             |            |              |            |              |           |             |   |    |    |   |             |              |             |     |  |  |  |   | 52,552,570   |           
|STOCKHOLDERS DEFICIENCY                 |                                     |                           | (112,073,457 | )           |            |              | (58,444,955 | )            |           |             |    |    |    |   | 55,758,083   |              | (c)         |     |  |  |  |   | (114,760,329 | )         
|                                         |                                     |                           |              |             |            |              |             |              |           |             |    |    |    |   |              |              |             |     |  |  |  |   |              |           
|TOTAL                                    |                                     | $                         | 63,786,767   |             |            | $            | 52,774,122  |              |           | $           | 83 |    |    | $ | (81,094,862  | )            |             |     |  |  |  | $ | 35,466,110   |           
|                                         |                                     |                           |              |             |            |              |             |              |           |             |    |    |    |   |              |              |             |     |  |  |  |   |              |           



|(a) |  | To eliminate inter-company accounts and notes payable.                                                           
|--- |  | -----------------------------------------------------------------------------------------------------------------
|   
|(b) |  | To eliminate inter-company accounts and notes receivable, investment in
subsidiaries and other capitalized costs.
|   
|(c) |  | To eliminate investment in subsidiaries and other capitalized costs.                                             

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---



##### Table of Contents



Condensed consolidating balance sheet information as of December 31, 2001:

|                                         |                                     |                           |             |             |            |              |             |              |           |             |        |       |       |   |              |              |             |     |  |  |  |   |              |             |            | 
|---------------------------------------- | ----------------------------------- | ------------------------- | ----------- | ----------- | ---------- | ------------ | ----------- | ------------ | --------- | ----------- | ------ | ----- | ----- | - | ------------ | ------------ | ----------- | --- |  |  |  | - | ------------ | ----------- | ---------- | 
|                                         |                                     |                           |             | Fitzgeralds |            |              |             |              |           | Non         |        |       |       |   |              |              |             |     |  |  |  |  
|                                         |                                     |                           |             | Gaming      |            | Guarantor    |             | Guarantor    |           | Eliminating |        |       |       |   |              | Consolidated
|                                         |                                     |                           |             | Corporation |            | Subsidiaries |             | Subsidiaries |           | Entries     |        |       |       |   |              | Total       
|                                         |                                     |                           |             |             |            |              |             |              |           |             |        |       |       |   |              |             
|ASSETS                                   |                                     |                           |             |             |            |              |             |              |           |             |        |       |       |   |              |              |             |     |  |  |  |   |              |            
|CURRENT ASSETS:                          |                                     |                           |             |             |            |              |             |              |           |             |        |       |       |   |              |              |             |     |  |  |  |   |              |            
|                                         | Cash and cash equivalents           |                           | $           | 20,401,627  |            |              | $           | 5,206,575    |           |             | $      | 810   |       |   | $            |             |             |     |  |  |  |   | $            | 25,609,012  |           
|                                         | Accounts and notes receivable, net  |                           |             | 16,091      |            |              |             | 439,668      |           |             |        |      |       |   |              |             |             |     |  |  |  |   |              | 455,759     |           
|                                         | Inventories                         |                           |             |            |            |              |             | 493,020      |           |             |        |      |       |   |              |             |             |     |  |  |  |   |              | 493,020     |           
|                                         | Prepaid and other current assets    |                           |             | 65,612      |            |              |             | 2,879,581    |           |             |        |      |       |   |              |             |             |     |  |  |  |   |              | 2,945,193   |           
|                                         |                                     |                           |             |             |            |              |             |              |           |             |        |       |       |   |              |              |             |     |  |  |  |   |              |            
|                                         |                                     | Total current assets      |             |             | 20,483,330 |              |             |              | 9,018,844 |             |        |       | 810   |   |              |              |            |     |  |  |  |   |              |             | 29,502,984 | 
|PROPERTY AND EQUIPMENT, NET              |                                     |                           | 55,397      |             |            |              |            |              |           |             |       |       |       |   |             |              |             |     |  |  |  |   | 55,397       |            
|NET ASSETS HELD FOR SALE                 |                                     |                           |            |             |            |              | 12,000,000  |              |           |             |       |       |       |   |              |              |             |     |  |  |  |   | 12,000,000   |            
|OTHER ASSETS                             |                                     |                           | 55,671,963  |             |            |              | 34,679,361  |              |           |             |       |       |       |   | (80,537,572  | )            | (b)         |     |  |  |  |   | 9,813,752    |            
|                                         |                                     |                           |             |             |            |              |             |              |           |             |        |       |       |   |              |              |             |     |  |  |  |   |              |            
|TOTAL                                    |                                     | $                         | 76,210,690  |             |            | $            | 55,698,205  |              |           | $           | 810    |       |       | $ | (80,537,572  | )            |             |     |  |  |  | $ | 51,372,133   |            
|                                         |                                     |                           |             |             |            |              |             |              |           |             |        |       |       |   |              |              |             |     |  |  |  |   |              |            
|LIABILITIES AND STOCKHOLDERS DEFICIENCY |                                     |                           |             |             |            |              |             |              |           |             |        |       |       |   |              |              |             |     |  | 
|CURRENT LIABILITIES:                     |                                     |                           |             |             |            |              |             |              |           |             |        |       |       |   |              |              |             |     |  |  |  |   |              |            
|                                         | Current portion of long-term debt   |                           | $           |            |            |              | $           | 110,791      |           |             | $      |      |       |   | $            |             |             |     |  |  |  |   | $            | 110,791     |           
|                                         | Accounts payable, accrued and other |                           |             | 18,005,758  |            |              |             | 4,352,890    |           |             |        | 4,066 |       |   |              | (17,664,018  | )           | (a) |  |  |  |   |              | 4,698,696   |           
|                                         |                                     |                           |             |             |            |              |             |              |           |             |        |       |       |   |              |              |             |     |  |  |  |   |              |            
|                                         |                                     | Total current liabilities |             |             | 18,005,758 |              |             |              | 4,463,681 |             |        |       | 4,066 |   |              |              | (17,664,018 | )   |  |  |  |   |              |             | 4,809,487  | 
|                                         |                                     |                           |             |             |            |              |             |              |           |             |        |       |       |   |              |              |             |     |  |  |  |   |              |            
|DUE TO MAJESTIC                          |                                     |                           |            |             |            |              | 3,812,945   |              |           |             |       |       |       |   |             |              |             |     |  |  |  |   | 3,812,945    |            
|LONG TERM DEBT, Net of current portion   |                                     |                           |            |             |            |              | 2,295,588   |              |           |             |       |       |       |   |             |              |             |     |  |  |  |   | 2,295,588    |            
|LIABILITIES SUBJECT TO COMPROMISE        |                                     |                           | 112,447,753 |             |            |              | 104,314,069 |              |           |             |       |       |       |   | (119,426,501 | )            | (a)         |     |  |  |  |   | 97,335,321   |            
|                                         |                                     |                           |             |             |            |              |             |              |           |             |        |       |       |   |              |              |             |     |  |  |  |   |              |            
|                                         | Total liabilities                   |                           |             | 130,453,511 |            |              |             | 114,886,283  |           |             |        | 4,066 |       |   |              | (137,090,519 | )           |     |  |  |  |   |              | 108,253,341 |           
|CUMULATIVE REDEEMABLE
PREFERRED STOCK    |                                     |                           | 43,902,161  |             |            |              |            |              |           |             |       |       |       |   |             |              |             |     |  |  |  |   | 43,902,161   |            
|STOCKHOLDERS DEFICIENCY                 |                                     |                           | (98,144,982 | )           |            |              | (59,188,078 | )            |           |             | (3,256 | )     |       |   | 56,552,947   |              | (c)         |     |  |  |  |   | (100,783,369 | )          
|                                         |                                     |                           |             |             |            |              |             |              |           |             |        |       |       |   |              |              |             |     |  |  |  |   |              |            
|TOTAL                                    |                                     | $                         | 76,210,690  |             |            | $            | 55,698,205  |              |           | $           | 810    |       |       | $ | (80,537,572  | )            |             |     |  |  |  | $ | 51,372,133   |            
|                                         |                                     |                           |             |             |            |              |             |              |           |             |        |       |       |   |              |              |             |     |  |  |  |   |              |            



---

|(a) |  | To eliminate inter-company accounts and notes payable                                                            
|--- |  | -----------------------------------------------------------------------------------------------------------------
|   
|(b) |  | To eliminate inter-company accounts and notes receivable, investment in
subsidiaries and other capitalized costs.
|   
|(c) |  | To eliminate investment in subsidiaries, other capitalized costs and
inter-company deferred interest income.     

F - 30



---



##### Table of Contents



Condensed consolidating statement of operations information for the year ended
December 31, 2002:

|                              |                                     |             |            |             |           |              |         |              |            |             |       |         |        |              |          |          |   |     |  |   |            |            |            | 
|----------------------------- | ----------------------------------- | ----------- | ---------- | ----------- | --------- | ------------ | ------- | ------------ | ---------- | ----------- | ----- | ------- | ------ | ------------ | -------- | -------- | - | --- |  | - | ---------- | ---------- | ---------- | 
|                              |                                     |             |            | Fitzgeralds |           |              |         |              |            | Non         |       |         |        |              |          |          |   |     |  |  
|                              |                                     |             |            | Gaming      |           | Guarantor    |         | Guarantor    |            | Eliminating |       |         |        | Consolidated
|                              |                                     |             |            | Corporation |           | Subsidiaries |         | Subsidiaries |            | Entries     |       |         |        | Total       
|                              |                                     |             |            |             |           |              |         |              |            |             |       |         |        |             
|OPERATING REVENUES:           |                                     |             |            |             |           |              |         |              |            |             |       |         |        |              |          |          |   |     |  |   |            |           
|                              | Casino                              |             | $          |            |           |              | $       | 30,675,029   |            |             | $     |        |        |              | $        |         |   |     |  |   | $          | 30,675,029 |           
|                              | Food and beverage                   |             |            |            |           |              |         | 5,976,575    |            |             |       |        |        |              |          |         |   |     |  |   |            | 5,976,575  |           
|                              | Rooms                               |             |            |            |           |              |         | 5,080,463    |            |             |       |        |        |              |          |         |   |     |  |   |            | 5,080,463  |           
|                              | Other                               |             |            | 33,440      |           |              |         | 765,618      |            |             |       |        |        |              |          |         |   |     |  |   |            | 799,058    |           
|                              |                                     |             |            |             |           |              |         |              |            |             |       |         |        |              |          |          |   |     |  |   |            |           
|                              |                                     | Total       |            |             | 33,440    |              |         |              | 42,497,685 |             |       |         |       |              |          |          |  |     |  |   |            |            | 42,531,125 | 
|                              | Less promotional allowances         |             |            |            |           |              |         | 5,530,198    |            |             |       |        |        |              |          |         |   |     |  |   |            | 5,530,198  |           
|                              |                                     |             |            |             |           |              |         |              |            |             |       |         |        |              |          |          |   |     |  |   |            |           
|                              |                                     | Net revenue |            |             | 33,440    |              |         |              | 36,967,487 |             |       |         |       |              |          |          |  |     |  |   |            |            | 37,000,927 | 
|                              |                                     |             |            |             |           |              |         |              |            |             |       |         |        |              |          |          |   |     |  |   |            |           
|OPERATING COSTS AND
EXPENSES: |                                     |             |            |             |           |              |         |              |            |             |       |         |        |              |          |          |   |     |  |   |            |           
|                              | Casino                              |             |            |            |           |              |         | 15,775,848   |            |             |       |        |        |              |          |          |   |     |  |   |            | 15,775,848 |           
|                              | Food and beverage                   |             |            |            |           |              |         | 4,004,888    |            |             |       |        |        |              |          |          |   |     |  |   |            | 4,004,888  |           
|                              | Rooms                               |             |            |            |           |              |         | 1,763,134    |            |             |       |        |        |              |          |          |   |     |  |   |            | 1,763,134  |           
|                              | Other operating expense             |             |            |            |           |              |         | 357,066      |            |             |       |        |        |              |          |          |   |     |  |   |            | 357,066    |           
|                              | Selling, general and administrative |             |            | 3,544,069   |           |              |         | 13,835,816   |            |             |       | 51,862  |        |              |          |          |   |     |  |   |            | 17,431,747 |           
|                              | Depreciation and amortization       |             |            | 30,342      |           |              |         |             |            |             |       |        |        |              |          |          |   |     |  |   |            | 30,342     |           
|                              | Write-down of assets                |             |            |            |           |              |         | 55,117       |            |             |       | (55,117 | )      |              |          |          |   |     |  |   |            |           |           
|                              | Reorganization items                |             |            | 1,562,546   |           |              |         | 189,033      |            |             |       |        |        |              |          |          |   |     |  |   |            | 1,751,579  |           
|                              |                                     |             |            |             |           |              |         |              |            |             |       |         |        |              |          |          |   |     |  |   |            |           
|                              |                                     | Total       |            |             | 5,136,957 |              |         |              | 35,980,902 |             |       |         | (3,255 | )            |          |          |  |     |  |   |            |            | 41,114,604 | 
|                              |                                     |             |            |             |           |              |         |              |            |             |       |         |        |              |          |          |   |     |  |   |            |           
|INCOME (LOSS) FROM OPERATIONS |                                     |             | (5,103,517 | )           |           |              | 986,585 |              |            |             | 3,255 |         |        |              |         |          |   |     |  |   | (4,113,677 | )         
|OTHER INCOME (EXPENSE):       |                                     |             |            |             |           |              |         |              |            |             |       |         |        |              |          |          |   |     |  |   |            |           
|                              | Interest income                     |             |            | 66,973      |           |              |         |             |            |             |       |        |        |              |          |          |   |     |  |   |            | 66,973     |           
|                              | Interest expense                    |             |            | (1,036,387  | )         |              |         | (237,542     | )          |             |       |        |        |              |          |          |   |     |  |   |            | (1,273,929 | )         
|                              | Loss on sale of asset               |             |            |            |           |              |         | (5,918       | )          |             |       |        |        |              |          |          |   |     |  |   |            | (5,918     | )         
|                              | Other income (expense)              |             |            | 794,864     |           |              |         |             |            |             |       |         |        |              |          | (794,864 | ) | (e) |  |   |            |           |           
|                              |                                     |             |            |             |           |              |         |              |            |             |       |         |        |              |          |          |   |     |  |   |            |           
|NET (LOSS) INCOME             |                                     | $           | (5,278,067 | )           |           | $            | 743,125 |              |            | $           | 3,255 |         |        | $            | (794,864 | )        |   |     |  | $ | (5,326,551 | )         
|                              |                                     |             |            |             |           |              |         |              |            |             |       |         |        |              |          |          |   |     |  |   |            |           



---

|(e) |  | To eliminate inter-company interest in income of subsidiaries.
|--- |  | --------------------------------------------------------------

F - 31



---



##### Table of Contents



Condensed consolidating statement of operations information for the year ended
December 31, 2001:

|                              |                                     |             |            |             |           |              |            |              |             |             |         |         |        |              |             |             |            |     |  |   |           |             |             | 
|----------------------------- | ----------------------------------- | ----------- | ---------- | ----------- | --------- | ------------ | ---------- | ------------ | ----------- | ----------- | ------- | ------- | ------ | ------------ | ----------- | ----------- | ---------- | --- |  | - | --------- | ----------- | ----------- | 
|                              |                                     |             |            | Fitzgeralds |           |              |            |              |             | Non         |         |         |        |              |             |             |            |     |  |  
|                              |                                     |             |            | Gaming      |           | Guarantor    |            | Guarantor    |             | Eliminating |         |         |        | Consolidated
|                              |                                     |             |            | Corporation |           | Subsidiaries |            | Subsidiaries |             | Entries     |         |         |        | Total       
|                              |                                     |             |            |             |           |              |            |              |             |             |         |         |        |             
|OPERATING REVENUES:           |                                     |             |            |             |           |              |            |              |             |             |         |         |        |              |             |             |            |     |  |   |           |            
|                              | Casino                              |             | $          |            |           |              | $          | 182,099,883  |             |             | $       |        |        |              | $           |            |            |     |  |   | $         | 182,099,883 |            
|                              | Food and beverage                   |             |            |            |           |              |            | 24,192,643   |             |             |         |        |        |              |             |            |            |     |  |   |           | 24,192,643  |            
|                              | Rooms                               |             |            |            |           |              |            | 20,497,604   |             |             |         |        |        |              |             |            |            |     |  |   |           | 20,497,604  |            
|                              | Other                               |             |            | 34,435      |           |              |            | 4,364,513    |             |             |         |        |        |              |             |            |            |     |  |   |           | 4,398,948   |            
|                              |                                     |             |            |             |           |              |            |              |             |             |         |         |        |              |             |             |            |     |  |   |           |            
|                              |                                     | Total       |            |             | 34,435    |              |            |              | 231,154,643 |             |         |         |       |              |             |             |           |     |  |   |           |             | 231,189,078 | 
|                              | Less promotional allowances         |             |            |            |           |              |            | 35,158,058   |             |             |         |        |        |              |             |            |            |     |  |   |           | 35,158,058  |            
|                              |                                     |             |            |             |           |              |            |              |             |             |         |         |        |              |             |             |            |     |  |   |           |            
|                              |                                     | Net revenue |            |             | 34,435    |              |            |              | 195,996,585 |             |         |         |       |              |             |             |           |     |  |   |           |             | 196,031,020 | 
|                              |                                     |             |            |             |           |              |            |              |             |             |         |         |        |              |             |             |            |     |  |   |           |            
|OPERATING COSTS AND
EXPENSES: |                                     |             |            |             |           |              |            |              |             |             |         |         |        |              |             |             |            |     |  |   |           |            
|                              | Casino                              |             |            |            |           |              |            | 85,714,549   |             |             |         |        |        |              |             |            |            |     |  |   |           | 85,714,549  |            
|                              | Food and beverage                   |             |            |            |           |              |            | 14,432,471   |             |             |         |        |        |              |             |            |            |     |  |   |           | 14,432,471  |            
|                              | Rooms                               |             |            |            |           |              |            | 11,745,026   |             |             |         |        |        |              |             |            |            |     |  |   |           | 11,745,026  |            
|                              | Other operating expense             |             |            |            |           |              |            | 2,001,112    |             |             |         |        |        |              |             |            |            |     |  |   |           | 2,001,112   |            
|                              | Selling, general and administrative |             |            | 4,524,689   |           |              |            | 51,693,628   |             |             |         | 73,906  |        |              |             | (4,000,000  | )          | (g) |  |   |           | 52,292,223  |            
|                              | Depreciation and amortization       |             |            | 33,083      |           |              |            | 803          |             |             |         |        |        |              |             |            |            |     |  |   |           | 33,886      |            
|                              | Write-down of assets                |             |            |            |           |              |            | 27,769,923   |             |             |         |        |        |              |             |            |            |     |  |   |           | 27,769,923  |            
|                              | Reorganization items                |             |            | 2,788,952   |           |              |            | (10,716,513  | )           |             |         |        |        |              |             |            |            |     |  |   |           | (7,927,561  | )          
|                              |                                     |             |            |             |           |              |            |              |             |             |         |         |        |              |             |             |            |     |  |   |           |            
|                              |                                     | Total       |            |             | 7,346,724 |              |            |              | 182,640,999 |             |         |         | 73,906 |              |             |             | (4,000,000 | )   |  |   |           |             | 186,061,629 | 
|                              |                                     |             |            |             |           |              |            |              |             |             |         |         |        |              |             |             |            |     |  |   |           |            
|INCOME (LOSS) FROM OPERATIONS |                                     |             | (7,312,289 | )           |           |              | 13,355,586 |              |             |             | (73,906 | )       |        |              | 4,000,000   |             |            |     |  |   | 9,969,391 |            
|OTHER INCOME (EXPENSE):       |                                     |             |            |             |           |              |            |              |             |             |         |         |        |              |             |             |            |     |  |   |           |            
|                              | Interest income                     |             |            | 1,621,596   |           |              |            | 36,690       |             |             |         |        |        |              |             | (1,504,076  | )          | (h) |  |   |           | 154,210     |            
|                              | Interest expense                    |             |            | (4,394,492  | )         |              |            | (287,896     | )           |             |         |        |        |              |             |            |            |     |  |   |           | (4,682,388  | )          
|                              | Gain on sale of asset               |             |            |            |           |              |            | (3,029,280   | )           |             |         |        |        |              |             | 1,904,150   |            | (e) |  |   |           | (1,125,130  | )          
|                              | Other income (expense)              |             |            | 16,129,242  |           |              |            | (106,148     | )           |             |         | 151,396 |        |              |             | (16,173,125 | )          | (f) |  |   |           | 1,365       |            
|                              |                                     |             |            |             |           |              |            |              |             |             |         |         |        |              |             |             |            |     |  |   |           |            
|NET INCOME                    |                                     | $           | 6,044,057  |             |           | $            | 9,968,952  |              |             | $           | 77,490  |         |        | $            | (11,773,051 | )           |            |     |  | $ | 4,317,448 |            
|                              |                                     |             |            |             |           |              |            |              |             |             |         |         |        |              |             |             |            |     |  |   |           |            



---

|(e) |  | To eliminate inter-company loss on sale of asset.                                                                                                       
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(f) |  | To eliminate interest in loss of subsidiaries and inter-company management
fee expense.                                                                 
|   
|(g) |  | To eliminate inter-company management fee expense.                                                                                                      
|   
|(h) |  | To eliminate inter-company interest income, inter-company management fee
income, inter-company deferred interest
income, and other inter-company income.

F - 32



---



##### Table of Contents



Condensed consolidating statement of operations information for the year ended
December 31, 2000:

|                              |                                     |             |             |             |           |              |             |              |             |             |         |         |              |   |            |             |            |     |   |             |             |             | 
|----------------------------- | ----------------------------------- | ----------- | ----------- | ----------- | --------- | ------------ | ----------- | ------------ | ----------- | ----------- | ------- | ------- | ------------ | - | ---------- | ----------- | ---------- | --- | - | ----------- | ----------- | ----------- | 
|                              |                                     |             |             | Fitzgeralds |           |              |             |              |             | Non         |         |         |              |   |            |             |            |     |  
|                              |                                     |             |             | Gaming      |           | Guarantor    |             | Guarantor    |             | Eliminating |         |         | Consolidated
|                              |                                     |             |             | Corporation |           | Subsidiaries |             | Subsidiaries |             | Entries     |         |         | Total       
|                              |                                     |             |             |             |           |              |             |              |             |             |         |         |             
|OPERATING REVENUES:           |                                     |             |             |             |           |              |             |              |             |             |         |         |              |   |            |             |            |     |   |             |            
|                              | Casino                              |             | $           |            |           |              | $           | 181,724,286  |             |             | $       |        |              |   | $          |            |            |     |   | $           | 181,724,286 |            
|                              | Food and beverage                   |             |             |            |           |              |             | 25,809,006   |             |             |         |        |              |   |            |            |            |     |   |             | 25,809,006  |            
|                              | Rooms                               |             |             |            |           |              |             | 22,060,254   |             |             |         |        |              |   |            |            |            |     |   |             | 22,060,254  |            
|                              | Other                               |             |             | 153,571     |           |              |             | 4,396,112    |             |             |         |        |              |   |            |            |            |     |   |             | 4,549,683   |            
|                              |                                     |             |             |             |           |              |             |              |             |             |         |         |              |   |            |             |            |     |   |             |            
|                              |                                     | Total       |             |             | 153,571   |              |             |              | 233,989,658 |             |         |         |             |   |            |             |           |     |   |             |             | 234,143,229 | 
|                              | Less promotional allowances         |             |             |            |           |              |             | 34,041,653   |             |             |         |        |              |   |            |            |            |     |   |             | 34,041,653  |            
|                              |                                     |             |             |             |           |              |             |              |             |             |         |         |              |   |            |             |            |     |   |             |            
|                              |                                     | Net revenue |             |             | 153,571   |              |             |              | 199,948,005 |             |         |         |             |   |            |             |           |     |   |             |             | 200,101,576 | 
|                              |                                     |             |             |             |           |              |             |              |             |             |         |         |              |   |            |             |            |     |   |             |            
|OPERATING COSTS AND
EXPENSES: |                                     |             |             |             |           |              |             |              |             |             |         |         |              |   |            |             |            |     |   |             |            
|                              | Casino                              |             |             |            |           |              |             | 84,739,719   |             |             |         |        |              |   |            |            |            |     |   |             | 84,739,719  |            
|                              | Food and beverage                   |             |             |            |           |              |             | 15,398,511   |             |             |         |        |              |   |            |            |            |     |   |             | 15,398,511  |            
|                              | Rooms                               |             |             |            |           |              |             | 12,793,036   |             |             |         |        |              |   |            |            |            |     |   |             | 12,793,036  |            
|                              | Other operating expense             |             |             |            |           |              |             | 2,115,389    |             |             |         |        |              |   |            |            |            |     |   |             | 2,115,389   |            
|                              | Selling, general and administrative |             |             | 7,564,174   |           |              |             | 52,831,618   |             |             |         | 50,884  |              |   |            | (4,000,000  | )          | (g) |   |             | 56,446,676  |            
|                              | Depreciation and amortization       |             |             | 58,259      |           |              |             | 13,919,596   |             |             |         |        |              |   |            |            |            |     |   |             | 13,977,855  |            
|                              | Reorganization items                |             |             | 110,569     |           |              |             | 38,967       |             |             |         |        |              |   |            |            |            |     |   |             | 149,536     |            
|                              |                                     |             |             |             |           |              |             |              |             |             |         |         |              |   |            |             |            |     |   |             |            
|                              |                                     | Total       |             |             | 7,733,002 |              |             |              | 181,836,836 |             |         |         | 50,884       |   |            |             | (4,000,000 | )   |   |             |             | 185,620,722 | 
|                              |                                     |             |             |             |           |              |             |              |             |             |         |         |              |   |            |             |            |     |   |             |            
|INCOME (LOSS) FROM OPERATIONS |                                     |             | (7,579,431  | )           |           |              | 18,111,169  |              |             |             | (50,884 | )       |              |   | 4,000,000  |             |            |     |   | 14,480,854  |            
|OTHER INCOME (EXPENSE):       |                                     |             |             |             |           |              |             |              |             |             |         |         |              |   |            |             |            |     |   |             |            
|                              | Interest income                     |             |             | 30,528,357  |           |              |             | 168,070      |             |             |         | 2,150   |              |   |            | (29,658,631 | )          | (h) |   |             | 1,039,946   |            
|                              | Interest expense                    |             |             | (31,531,365 | )         |              |             | (29,897,611  | )           |             |         |        |              |   |            | 29,586,392  |            | (e) |   |             | (31,842,584 | )          
|                              | Other income (expense)              |             |             | (7,691,360  | )         |              |             | (1,711       | )           |             |         | (15,851 | )            |   |            | 7,644,380   |            | (f) |   |             | (64,542     | )          
|                              |                                     |             |             |             |           |              |             |              |             |             |         |         |              |   |            |             |            |     |   |             |            
|NET LOSS                      |                                     | $           | (16,273,799 | )           |           | $            | (11,620,083 | )            |             | $           | (64,585 | )       |              | $ | 11,572,141 |             |            |     | $ | (16,386,326 | )          
|                              |                                     |             |             |             |           |              |             |              |             |             |         |         |              |   |            |             |            |     |   |             |            



---

|(e) |  | To eliminate inter-company interest expense.                                                                                                            
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(f) |  | To eliminate interest in loss of subsidiaries and inter-company
management fee expense.                                                                 
|   
|(g) |  | To eliminate inter-company management fee expense.                                                                                                      
|   
|(h) |  | To eliminate inter-company interest income, inter-company management fee
income, inter-company deferred interest
income, and other inter-company income.

F - 33



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##### Table of Contents



Condensed consolidating statement of cash flows information for the year ended
December 31, 2002:

|                                            |                                                     |   |             |            |              |   |              |          |             |   |               |   |  |   |   |   |  |   |             |            |  
|------------------------------------------- | --------------------------------------------------- | - | ----------- | ---------- | ------------ | - | ------------ | -------- | ----------- | - | ------------- | - |  | - | - | - |  | - | ----------- | ---------- | -
|                                            |                                                     |   | Fitzgeralds |            |              |   |              |          | Non         |   |               |   |  |   |   |   | 
|                                            |                                                     |   | Gaming      |            | Guarantor    |   | Guarantor    |          | Eliminating |   | Consolidating
|                                            |                                                     |   | Corporation |            | Subsidiaries |   | Subsidiaries |          | Entries     |   | Total        
|                                            |                                                     |   |             |            |              |   |              |          |             |   |              
|NET CASH USED IN OPERATING
ACTIVITIES       |                                                     | $ | (7,396,073  | )          |              | $ | (592,468     | )        |             | $ | (727          | ) |  | $ |  |   |  | $ | (7,989,268  | )         
|                                            |                                                     |   |             |            |              |   |              |          |             |   |               |   |  |   |   |   |  |   |             |           
|CASH FLOWS FROM INVESTING
ACTIVITIES:       |                                                     |   |             |            |              |   |              |          |             |   |               |   |  |   |   |   |  |   |             |           
|                                            | Acquisition of property and equipment               |   |             | (45,084    | )            |   |              | (348,912 | )           |   |               |  |  |   |   |  |  |   |             | (393,996   | )
|                                            | Increase in restricted cash                         |   |             | 3,785,268  |              |   |              |         |             |   |               |  |  |   |   |  |  |   |             | 3,785,268  |  
|                                            |                                                     |   |             |            |              |   |              |          |             |   |               |   |  |   |   |   |  |   |             |           
|                                            | Net cash provided by (used in)
investing activities |   |             | 3,740,184  |              |   |              | (348,912 | )           |   |               |  |  |   |   |  |  |   |             | 3,391,272  |  
|                                            |                                                     |   |             |            |              |   |              |          |             |   |               |   |  |   |   |   |  |   |             |           
|CASH FLOWS FROM FINANCING
ACTIVITIES:       |                                                     |   |             |            |              |   |              |          |             |   |               |   |  |   |   |   |  |   |             |           
|                                            | Repayment of Senior Notes                           |   |             | (6,227,708 | )            |   |              |         |             |   |               |  |  |   |   |  |  |   |             | (6,227,708 | )
|                                            | Repayment of long-term debt                         |   |             |           |              |   |              | (258,060 | )           |   |               |  |  |   |   |  |  |   |             | (258,060   | )
|                                            |                                                     |   |             |            |              |   |              |          |             |   |               |   |  |   |   |   |  |   |             |           
|                                            | Net cash used in financing activities               |   |             | (6,227,708 | )            |   |              | (258,060 | )           |   |               |  |  |   |   |  |  |   |             | (6,485,768 | )
|                                            |                                                     |   |             |            |              |   |              |          |             |   |               |   |  |   |   |   |  |   |             |           
|NET DECREASE IN CASH AND
CASH EQUIVALENTS   |                                                     |   | (9,883,597  | )          |              |   | (1,199,440   | )        |             |   | (727          | ) |  |   |  |   |  |   | (11,083,764 | )         
|CASH AND CASH EQUIVALENTS
BEGINNING OF YEAR |                                                     |   | 20,401,627  |            |              |   | 5,206,575    |          |             |   | 810           |   |  |   |  |   |  |   | 25,609,012  |           
|                                            |                                                     |   |             |            |              |   |              |          |             |   |               |   |  |   |   |   |  |   |             |           
|CASH AND CASH EQUIVALENTS
END OF YEAR       |                                                     | $ | 10,518,030  |            |              | $ | 4,007,135    |          |             | $ | 83            |   |  | $ |  |   |  | $ | 14,525,248  |           
|                                            |                                                     |   |             |            |              |   |              |          |             |   |               |   |  |   |   |   |  |   |             |           

F - 34



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##### Table of Contents



Condensed consolidating statement of cash flows information for the year ended
December 31, 2001:

|                                                                      |                                                     |   |             |              |              |   |              |            |             |   |               |   |  |   |   |   |  |   |             |              |  
|--------------------------------------------------------------------- | --------------------------------------------------- | - | ----------- | ------------ | ------------ | - | ------------ | ---------- | ----------- | - | ------------- | - |  | - | - | - |  | - | ----------- | ------------ | -
|                                                                      |                                                     |   | Fitzgeralds |              |              |   |              |            | Non         |   |               |   |  |   |   |   | 
|                                                                      |                                                     |   | Gaming      |              | Guarantor    |   | Guarantor    |            | Eliminating |   | Consolidating
|                                                                      |                                                     |   | Corporation |              | Subsidiaries |   | Subsidiaries |            | Entries     |   | Total        
|                                                                      |                                                     |   |             |              |              |   |              |            |             |   |              
|NET CASH USED IN OPERATING
ACTIVITIES                                 |                                                     | $ | (13,291,137 | )            |              | $ | (8,805,626   | )          |             | $ | (9,699        | ) |  | $ |  |   |  | $ | (22,106,462 | )           
|                                                                      |                                                     |   |             |              |              |   |              |            |             |   |               |   |  |   |   |   |  |   |             |             
|CASH FLOWS FROM INVESTING
ACTIVITIES:                                 |                                                     |   |             |              |              |   |              |            |             |   |               |   |  |   |   |   |  |   |             |             
|                                                                      | Proceeds from sale of assets                        |   |             | 141,017,544  |              |   |              | 32,426     |             |   |               |  |  |   |   |  |  |   |             | 141,049,970  |  
|                                                                      | Acquisition of property and equipment               |   |             | (30,727      | )            |   |              | (1,784,070 | )           |   |               |  |  |   |   |  |  |   |             | (1,814,797   | )
|                                                                      | Increase in restricted cash                         |   |             | (4,195,732   | )            |   |              |           |             |   |               |  |  |   |   |  |  |   |             | (4,195,732   | )
|                                                                      |                                                     |   |             |              |              |   |              |            |             |   |               |   |  |   |   |   |  |   |             |             
|                                                                      | Net cash provided by (used in)
investing activities |   |             | 136,791,085  |              |   |              | (1,751,644 | )           |   |               |  |  |   |   |  |  |   |             | 135,039,441  |  
|                                                                      |                                                     |   |             |              |              |   |              |            |             |   |               |   |  |   |   |   |  |   |             |             
|CASH FLOWS FROM FINANCING
ACTIVITIES:                                 |                                                     |   |             |              |              |   |              |            |             |   |               |   |  |   |   |   |  |   |             |             
|                                                                      | Repayment of Senior Notes                           |   |             | (105,266,358 | )            |   |              |           |             |   |               |  |  |   |   |  |  |   |             | (105,266,358 | )
|                                                                      | Repayment of long-term debt                         |   |             |             |              |   |              | (350,869   | )           |   |               |  |  |   |   |  |  |   |             | (350,869     | )
|                                                                      |                                                     |   |             |              |              |   |              |            |             |   |               |   |  |   |   |   |  |   |             |             
|                                                                      | Net cash used in financing activities               |   |             | (105,266,358 | )            |   |              | (350,869   | )           |   |               |  |  |   |   |  |  |   |             | (105,617,227 | )
|                                                                      |                                                     |   |             |              |              |   |              |            |             |   |               |   |  |   |   |   |  |   |             |             
|NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS                  |                                                     |   | 18,233,590  |              |              |   | (10,908,139  | )          |             |   | (9,699        | ) |  |   |  |   |  |   | 7,315,752   |             
|CASH AND CASH EQUIVALENTS
BEGINNING OF YEAR                           |                                                     |   | 2,168,037   |              |              |   | 6,002,842    |            |             |   | 10,509        |   |  |   |  |   |  |   | 8,181,388   |             
|CASH AND CASH EQUIVALENTS
NET ASSETS HELD FOR SALE,
BEGINNING OF YEAR |                                                     |   |            |              |              |   | 10,111,872   |            |             |   |              |   |  |   |  |   |  |   | 10,111,872  |             
|                                                                      |                                                     |   |             |              |              |   |              |            |             |   |               |   |  |   |   |   |  |   |             |             
|CASH AND CASH EQUIVALENTS
END OF YEAR                                 |                                                     | $ | 20,401,627  |              |              | $ | 5,206,575    |            |             | $ | 810           |   |  | $ |  |   |  | $ | 25,609,012  |             
|                                                                      |                                                     |   |             |              |              |   |              |            |             |   |               |   |  |   |   |   |  |   |             |             

F - 35



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##### Table of Contents



Condensed consolidating statement of cash flows information for the year ended
December 31, 2000:

|                                                               |                                       |   |             |            |              |   |              |             |             |   |         |         |               |   |   |         |   |     |  |   |             |             |  
|-------------------------------------------------------------- | ------------------------------------- | - | ----------- | ---------- | ------------ | - | ------------ | ----------- | ----------- | - | ------- | ------- | ------------- | - | - | ------- | - | --- |  | - | ----------- | ----------- | -
|                                                               |                                       |   | Fitzgeralds |            |              |   |              |             | Non         |   |         |         |               |   |   |         |   |     | 
|                                                               |                                       |   | Gaming      |            | Guarantor    |   | Guarantor    |             | Eliminating |   |         |         | Consolidating
|                                                               |                                       |   | Corporation |            | Subsidiaries |   | Subsidiaries |             | Entries     |   |         |         | Total        
|                                                               |                                       |   |             |            |              |   |              |             |             |   |         |         |              
|NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES            |                                       | $ | (4,034,421  | )          |              | $ | 14,603,192   |             |             | $ | (5,206  | )       |               | $ |  |         |   |     |  | $ | 10,563,565  |            
|                                                               |                                       |   |             |            |              |   |              |             |             |   |         |         |               |   |   |         |   |     |  |   |             |            
|CASH FLOWS FROM INVESTING
ACTIVITIES:                          |                                       |   |             |            |              |   |              |             |             |   |         |         |               |   |   |         |   |     |  |   |             |            
|                                                               | Proceeds from sale of assets          |   |             |           |              |   |              | 41,971      |             |   |         |        |               |   |   |        |   |     |  |   |             | 41,971      |  
|                                                               | Acquisition of property and equipment |   |             | (24,500    | )            |   |              | (10,865,165 | )           |   |         |        |               |   |   |        |   |     |  |   |             | (10,889,665 | )
|                                                               | Decrease in restricted cash           |   |             | (2,799,000 | )            |   |              |            |             |   |         |        |               |   |   |        |   |     |  |   |             | (2,799,000  | )
|                                                               | Dividend received                     |   |             |           |              |   |              | 89,827      |             |   |         |        |               |   |   | (89,827 | ) | (a) |  |   |             |            |  
|                                                               |                                       |   |             |            |              |   |              |             |             |   |         |         |               |   |   |         |   |     |  |   |             |            
|                                                               | Net cash used in investing activities |   |             | (2,823,500 | )            |   |              | (10,733,367 | )           |   |         |        |               |   |   | (89,827 | ) |     |  |   |             | (13,646,694 | )
|                                                               |                                       |   |             |            |              |   |              |             |             |   |         |         |               |   |   |         |   |     |  |   |             |            
|CASH FLOWS FROM FINANCING
ACTIVITIES:                          |                                       |   |             |            |              |   |              |             |             |   |         |         |               |   |   |         |   |     |  |   |             |            
|                                                               | Repayment of long-term debt           |   |             | (178,470   | )            |   |              | (560,735    | )           |   |         |        |               |   |   |        |   |     |  |   |             | (739,205    | )
|                                                               | Repayment of long-term debt           |   |             |           |              |   |              |            |             |   |         | (89,827 | )             |   |   | 89,827  |   | (a) |  |   |             |            |  
|                                                               |                                       |   |             |            |              |   |              |             |             |   |         |         |               |   |   |         |   |     |  |   |             |            
|                                                               | Net cash used in financing activities |   |             | (178,470   | )            |   |              | (560,735    | )           |   |         | (89,827 | )             |   |   | 89,827  |   |     |  |   |             | (739,205    | )
|                                                               |                                       |   |             |            |              |   |              |             |             |   |         |         |               |   |   |         |   |     |  |   |             |            
|NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS           |                                       |   | (7,036,391  | )          |              |   | 3,309,090    |             |             |   | (95,033 | )       |               |   |  |         |   |     |  |   | (3,822,334  | )          
|CASH AND CASH EQUIVALENTS
BEGINNING OF YEAR                    |                                       |   | 9,204,428   |            |              |   | 12,805,624   |             |             |   | 105,542 |         |               |   |  |         |   |     |  |   | 22,115,594  |            
|CASH AND CASH EQUIVALENTS INCLUDED
IN NET ASSETS HELD FOR SALE |                                       |   |            |            |              |   | (10,111,872  | )           |             |   |        |         |               |   |  |         |   |     |  |   | (10,111,872 | )          
|                                                               |                                       |   |             |            |              |   |              |             |             |   |         |         |               |   |   |         |   |     |  |   |             |            
|CASH AND CASH EQUIVALENTS
END OF YEAR                          |                                       | $ | 2,168,037   |            |              | $ | 6,002,842    |             |             | $ | 10,509  |         |               | $ |  |         |   |     |  | $ | 8,181,388   |            
|                                                               |                                       |   |             |            |              |   |              |             |             |   |         |         |               |   |   |         |   |     |  |   |             |            



---

|(a) |  | To eliminate inter-company advances.
|--- |  | ------------------------------------

F - 36



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##### Table of Contents



17.     CONDENSED QUARTERLY RESULTS (Unaudited)

|     |                               |         |   |            |       |         |   |            |       |         |   |            |       |   |   |            |       |  
|---- | ----------------------------- | ------- | - | ---------- | ----- | ------- | - | ---------- | ----- | ------- | - | ---------- | ----- | - | - | ---------- | ----- | -
|     |                               |         |   | First      |       | Second  |   | Third      |       | Fourth 
|     |                               |         |   | Quarter    |       | Quarter |   | Quarter    |       | Quarter
|     |                               |         |   |            |       |         |   |            |       |        
|2002 |                               |         |   |            |       |         |   |            |       |         |   |            |       |   |   |           
|     | Net operating revenue         |         | $ | 8,274,172  |       |         | $ | 10,247,281 |       |         | $ | 10,455,715 |       |   | $ | 8,023,759  |      
|     | Income (loss) from operations |         |   | (1,969,455 | )     |         |   | (397,758   | )     |         |   | 526,662    |       |   | $ | (2,273,127 | )    
|     | Income (loss) from operations |         |   | (2,280,998 | )     |         |   | (709,699   | )     |         |   | 215,171    |       |   | $ | (2,551,026 | )    
|     | Net income (loss) per share:  |         |   |            |       |         |   |            |       |         |   |            |       |   |   |            |      
|     |                               | Basic   |   | $          | (0.79 | )       |   | $          | (0.51 | )       |   | $          | (0.36 | ) |   | $          | (0.88 | )
|     |                               | Diluted |   | $          | (0.79 | )       |   | $          | (0.51 | )       |   | $          | (0.36 | ) |   | $          | (0.88 | )

|     |                               |         |   |            |      |         |   |            |      |         |   |            |      |  |   |             |       |  
|---- | ----------------------------- | ------- | - | ---------- | ---- | ------- | - | ---------- | ---- | ------- | - | ---------- | ---- |  | - | ----------- | ----- | -
|     |                               |         |   | First      |      | Second  |   | Third      |      | Fourth 
|     |                               |         |   | Quarter    |      | Quarter |   | Quarter    |      | Quarter
|     |                               |         |   |            |      |         |   |            |      |        
|2001 |                               |         |   |            |      |         |   |            |      |         |   |            |      |  |   |            
|     | Net operating revenue         |         | $ | 52,129,477 |      |         | $ | 53,875,456 |      |         | $ | 53,645,218 |      |  | $ | 36,380,869  |      
|     | Income (loss) from operations |         |   | 7,762,173  |      |         |   | 7,958,079  |      |         |   | 8,634,874  |      |  |   | (12,239,273 | )    
|     | Net income (loss)             |         |   | 7,304,552  |      |         |   | 7,443,821  |      |         |   | 8,054,153  |      |  |   | (16,338,616 | )    
|     | Net income (loss) per share:  |         |   |            |      |         |   |            |      |         |   |            |      |  |   |             |      
|     |                               | Basic   |   | $          | 1.00 |         |   | $          | 1.02 |         |   | $          | 1.12 |  |   | $           | (3.72 | )
|     |                               | Diluted |   | $          | 1.00 |         |   | $          | 1.02 |         |   | $          | 1.12 |  |   | $           | (3.72 | )

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##### Table of Contents



|                                                      |  |            
|----------------------------------------------------- |  | -----------
|FITZGERALDS GAMING CORPORATION (DEBTOR-IN-POSSESSION) |  | SCHEDULE II

CONSOLIDATED VALUATION AND QUALIFYING ACCOUNTS

ALLOWANCE FOR DOUBTFUL ACCOUNTS RECEIVABLE

|         |  |           |         |           |  |            |         |  |  |         |          |   |  |        |  |  |  |   |         | 
|-------- |  | --------- | ------- | --------- |  | ---------- | ------- |  |  | ------- | -------- | - |  | ------ |  |  |  | - | ------- | 
|         |  |           |         |           |  | Additions  |         |  |  |         |          |   |  |        |  |  |  |  
|         |  |           |         |           |  | Charged to |         |  |  |         |          |   |  |        |  |  |  |  
|         |  | Beginning |         | Costs and |  |            |         |  |  |         |          |   |  | Ending
|FYE      |  | Balance   |         | Expenses  |  | Deductions |         |  |  | Balance
|         |  |           |         |           |  |            | (1)     |  |  |        
|12/31/00 |  | $         | 405,003 |           |  | $          | 147,640 |  |  | $       | (277,970 | ) |  |        |  |  |  | $ | 274,673 | 
|12/31/01 |  |           | 274,673 |           |  |            | 72,882  |  |  |         | (298,555 | ) |  |        |  |  |  |   | 49,000  | 
|12/31/02 |  |           | 49,000  |           |  |            | 47,490  |  |  |         | (72,078  | ) |  |        |  |  |  |   | 24,412  | 

ALLOWANCE TO WRITE ASSETS HELD FOR SALE TO ESTIMATED REALIZABLE VALUE

|         |  |           |   |           |  |            |            |         |  |        |   |  |  |   |            | 
|-------- |  | --------- | - | --------- |  | ---------- | ---------- | ------- |  | ------ | - |  |  | - | ---------- | 
|         |  |           |   |           |  | Additions  |            |         |  |        |   |  |  |  
|         |  |           |   |           |  | Charged to |            |         |  |        |   |  |  |  
|         |  | Beginning |   | Costs and |  |            |            |         |  | Ending
|FYE      |  | Balance   |   | Expenses  |  | Disposal   |            | Balance
|         |  |           |   |           |  |            |            |        
|12/31/00 |  | $         |  |           |  | $          |           |         |  | $      |  |  |  | $ |           | 
|12/31/01 |  |           |  |           |  |            | 14,764,341 |         |  |        |  |  |  |   | 14,764,341 | 
|12/31/02 |  |           |  |           |  |            |           |         |  |        |  |  |  |   |           | 



---

|(1) |  | Write-offs of uncollectible accounts receivable, net of recoveries.
|--- |  | -------------------------------------------------------------------

F - 38



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##### Table of Contents



Index to Exhibits

|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |              |  | 
|------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------ |  | 
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  | Sequentially
|Exhibit |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  | Numbered    
|Number  |  | Document                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | Page        
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |             
|2(a)    |  | (i) Recapitalization Agreement, dated March 14, 1994, among Fitzgeralds South,
Inc. (formerly Fitzgeralds Gaming Corporation), Fitzgeralds Las Vegas, Inc. and
certain stockholders thereof; (ii) Plan of Reorganization and Stockholders
Agreement, dated December 5, 1994, among Fitzgeralds Gaming Corporation and
stockholders of Fitzgeralds Reno, Inc., Fitzgeralds South, Inc., Fitzgeralds Inc.,
Nevada Club, Inc.; and (iii) Supplement to Plan of Reorganization and Stockholders
Agreement, dated December 30, 1994, between Fitzgeralds Gaming Corporation and the
stockholders of Fitzgeralds Reno, Inc. and Nevada Club, Inc.(1)
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|3(a)    |  | (i) Articles of Incorporation, as amended, and (ii) By-Laws of Fitzgeralds Gaming
Corporation, as amended.(1)(7)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|3(b)    |  | (i) Articles of Incorporation, as amended, and (ii) By-Laws of Fitzgeralds South,
Inc.(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|3(c)    |  | (i) Articles of Incorporation, as amended, and (ii) By-Laws of Fitzgeralds Reno,
Inc., as amended.(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|3(d)    |  | (i) Articles of Incorporation, as amended, and (ii) By-Laws of Fitzgeralds
Incorporated.(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|3(e)    |  | (i) Articles of Incorporation, as amended, and (ii) By-Laws of Nevada Club, Inc.(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|3(f)    |  | (i) Articles of Incorporation, as amended, and (ii) By-Laws of Fitzgeralds Las
Vegas, Inc.(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|3(g)    |  | (i) Articles of Incorporation, as amended, and (ii) By-Laws of Fitzgeralds Fremont
Experience Corporation.(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|3(h)    |  | (i) Articles of Incorporation, as amended, and (ii) By-Laws of Fitzgeralds
Mississippi, Inc.(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|3(i)    |  | (i) Articles of Incorporation, as amended, and (ii) By-Laws of Fitzgeralds Black
Hawk, Inc.(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|3(j)    |  | (i) Articles of Incorporation, as amended, and (ii) By-Laws of Fitzgeralds Black
Hawk II, Inc.(3)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|3(k)    |  | (i) Certificate of Organization, as amended and (ii) Second Amended and Restated
Operating Agreement of 101 Main Street Limited Liability Company.(3)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|4(a)    |  | Form of Indenture dated as of December 30, 1997, by and among Fitzgeralds Gaming
Corporation, Fitzgeralds South, Inc., Fitzgeralds Reno, Inc., Fitzgeralds
Incorporated, Fitzgeralds Las Vegas, Inc., Fitzgeralds Fremont Experience
Corporation, Fitzgeralds Mississippi, Inc., Fitzgeralds Black Hawk, Inc.,
Fitzgeralds Black Hawk II, Inc. and 101 Main Street Limited Liability Company, and
The Bank of New York, as trustee.(2)                                                                                                                                                                                                        

E-1



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##### Table of Contents



|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  |              |  | 
|------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------ |  | 
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  | Sequentially
|Exhibit |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  | Numbered    
|Number  |  | Document                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  | Page        
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  |             
|4(b)    |  | Form of Registration Rights Agreement dated as of December 30, 1997, by and among
Fitzgeralds Gaming Corporation, Fitzgeralds South, Inc., Fitzgeralds Reno, Inc.,
Fitzgeralds Incorporated, Fitzgeralds Las Vegas, Inc., Fitzgeralds Fremont
Experience Corporation, Fitzgeralds Mississippi, Inc., Fitzgeralds Black Hawk,
Inc., Fitzgeralds Black Hawk II, Inc. and 101 Main Street Limited Liability
Company, and Jefferies & Company, Inc. and Merrill Lynch, Merrill, Lynch, Pierce,
Fenner and Smith Incorporated, as initial purchasers.(2)
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|4(c)    |  | Form of Security and Pledge Agreement dated as of December 30, 1997, by and among
Fitzgeralds Gaming Corporation, Fitzgeralds South, Inc., Fitzgeralds Reno, Inc.,
Fitzgeralds Incorporated, Fitzgeralds Las Vegas, Inc., Fitzgeralds Fremont
Experience Corporation, Fitzgeralds Mississippi, Inc., Fitzgeralds Black Hawk,
Inc., Fitzgeralds Black Hawk II, Inc., and 101 Main Street Limited Liability
Company, as grantors, and The Bank of New York, as collateral agent.(2)                                                                  
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|4(d)    |  | Forms of Deed of Trust, Security Agreement and Fixture Filing with Assignment of
Rents, dated as of December 30, 1997, by each of Fitzgeralds Las Vegas, Inc.,
Fitzgeralds Mississippi, Inc., and Fitzgeralds Reno, Inc., as trustor, the trustee
named therein, as trustee, and The Bank of New York, as beneficiary.(2)                                                                                                                                                                                                                          
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|4(e)    |  | Form of First Preferred Vessel Mortgage on the Whole of the Fitzgeralds Tunica
dated as of December 30, 1997, by and between Fitzgeralds Mississippi, Inc., as
owner and mortgagor and The Bank of New York, as trustee.(2)                                                                                                                                                                                                                                                                                                                        
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|4(f)    |  | Form of Assignment of Rents, Leases and Property dated as of December 30, 1997, by
each of Fitzgeralds Mississippi, Inc. and 101 Main Street Limited Liability
Company, each as an assignor, and The Bank of New York, as assignee.(2)                                                                                                                                                                                                                                                                                                             
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|4(g)    |  | Form of Certificate of Designation of Preferences and Rights for the Preferred
Stock.(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|4(h)    |  | Form of Warrant Agreement between the Company and The Bank of New York, as
successor in interest to First Interstate Bank of Nevada, N.A., as warrant
agent.(1)                                                                                                                                                                                                                                                                                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|4(i)    |  | Form of First Amendment to Warrant Agreement by and between Fitzgeralds Gaming
Corporation and The Bank of New York, as warrant agent.(2)                                                                                                                                                                                                                                                                                                                                                                                                          
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|10(a)   |  | (i) Lease, dated December 31, 1974, between Santino Oppio, as Lessor, and Center
Street Properties Corp., as Lessee, and (ii) Sublease and Agreement, dated
December 31, 1986, by Meta K. Fitzgerald, as Sublessor, and Lincoln Investments,
Inc. (now known as Fitzgeralds Reno, Inc.), as Sublessee.(1)                                                                                                                                                                                                                                          
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|10(b)   |  | Fitzgeralds Gaming Corporation Stock Option Incentive Plan, amended and restated
as of May 1, 1998.(4)                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|10(c)   |  | Employment Agreements between Fitzgeralds Gaming Corporation and (i) Philip D.
Griffith dated June 28, 1999; (ii) Michael E. McPherson dated July 5, 1999; and
(iii) each of Paul H. Manske and Max L. Page dated September 1, 1999.(6)(7)                                                                                                                                                                                                                                                                                                         
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|10(d)   |  | Fitzgeralds Gaming Corporation Executive Bonus Plan, amended and restated as of
January 1, 1999.(5)                                                                                                                                                                                                                                                                                                                                                                                                                                                

E-2



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##### Table of Contents



|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |              |  | 
|------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------ |  | 
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | Sequentially
|Exhibit |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | Numbered    
|Number  |  | Document                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  | Page        
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |             
|10(e)   |  | License Agreement, dated September 11, 1995, between Holiday Inns Franchising,
Inc. and Fitzgeralds Las Vegas, Inc.(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10(f)   |  | Indemnification Agreements, each dated July 14, 1995, between Fitzgeralds Gaming
Corporation and each of Philip D. Griffith, Jerome H. Turk, Terrance W. Oliver,
Fernando Bensuaski, Michael E. McPherson and Gerald C. Heetland.(1)                                                                                                                                                                                                                                                                                                                                                                 
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10(g)   |  | Shareholders Agreement, dated December 19, 1995, among the Shareholders listed
therein, Fitzgeralds Gaming Corporation and First Interstate Bank of Nevada,
N.A.(5)                                                                                                                                                                                                                                                                                                                                                                                                                                 
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10(h)   |  | Self Insurers Surety Bond, dated as of October 19, 2000, executed by Western
Bonding Company for $2.5 million, for Fitzgeralds Gaming Corporation to act as a
self-insured employer in the State of Nevada.(9)                                                                                                                                                                                                                                                                                                                                                                                      
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10(i)   |  | Form of Management Agreement, dated March 17, 1999, between Fitzgeralds Gaming
Corporation and each of Fitzgeralds Las Vegas, Inc., Fitzgeralds Mississippi,
Inc., Fitzgeralds Reno, Inc. and 101 Main Street Limited Liability Company.(5)                                                                                                                                                                                                                                                                                                                                                          
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10(j)   |  | Agreement Regarding Pre-Negotiated Restructuring dated December 1, 2000.(8)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10(k)   |  | Purchase and Sale Agreement, as amended dated as of November 22, 2000 by and among
Majestic Investor, LLC, a Delaware limited liability company; Fitzgeralds Las
Vegas, Inc., a Nevada Corporation; 101 Main Street Limited Liability, a Colorado
limited liability company doing business as Fitzgeralds Casino Black Hawk;
Fitzgeralds Mississippi, Inc., a Mississippi corporation; Fitzgeralds Gaming
Corporation, a Nevada corporation; and certain affiliates of the foregoing parties
with respect to the assets of Fitzgeralds Las Vegas, Fitzgeralds Black Hawk and
Fitzgeralds Tunica.(8)
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10(l)   |  | Consulting contract, dated June 1, 2001, between Fitzgeralds Gaming Corporation on
behalf of itself and each of its operating subsidiaries: Fitzgeralds Mississippi,
Inc., Fitzgeralds Reno, Inc., Fitzgeralds Las Vegas, Inc. and 101 Main Street,
LLC, and Meritage Employer Services, LLC. (10)                                                                                                                                                                                                                                                                                                   
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10(m)   |  | Service Agreement for Workers Compensation Self-Insurance Program, dated June 1,
2001 between Fitzgeralds Gaming Corporation on behalf of itself and each of its
operating subsidiaries: Fitzgeralds Mississippi, Inc., Fitzgeralds Reno, Inc.,
Fitzgeralds Las Vegas, Inc. and 101 Main Street, LLC, and Meritage Employer
Services, LLC. (10)                                                                                                                                                                                                                                                     
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10(n)   |  | The Liability Claims Investigation, Adjustment and Management Agreement, dated
June 1, 2001 between Fitzgeralds Gaming Corporation on behalf of itself and each
of its operating subsidiaries: Fitzgeralds Mississippi, Inc., Fitzgeralds Reno,
Inc., Fitzgeralds Las Vegas, Inc. and 101 Main Street, LLC, and Meritage Employer
Services, LLC. (10)                                                                                                                                                                                                                                                
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10(o)   |  | The Claims Processing and Managed Care Services Contract, dated June 1, 2001
between Fitzgeralds Gaming Corporation on behalf of itself and each of its
operating subsidiaries: Fitzgeralds Mississippi, Inc., Fitzgeralds Reno, Inc.,
Fitzgeralds Las Vegas, Inc. and 101 Main Street, LLC, and Meritage Employer
Services, LLC. (10)                                                                                                                                                                                                                                                               

E-3



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##### Table of Contents



|        |  |                                                                                                                                                                                                                                                                             |  |              |  | 
|------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------ |  | 
|        |  |                                                                                                                                                                                                                                                                             |  | Sequentially
|Exhibit |  |                                                                                                                                                                                                                                                                             |  | Numbered    
|Number  |  | Document                                                                                                                                                                                                                                                                    |  | Page        
|        |  |                                                                                                                                                                                                                                                                             |  |             
|10(p)   |  | Bankruptcy Court Order re Motion to Approve Amended and Restated Agreement
Regarding Pre-negotiated Restructuring and related exhibits dated as of November
1, 2002. (11)                                                                                                  
|        |  |                                                                                                                                                                                                                                                                            
|10(q)   |  | Bankruptcy Court Order: (1) Approving Adequacy of Disclosures in Debtors
Disclosure Statement, (2) Setting Deadlines for Balloting and Opposing
Conformation of Debtors Plan of Reorganization and (3) Setting Confirmation
Hearing: Notice of Confirmation Hearing. (11)
|        |  |                                                                                                                                                                                                                                                                            
|10(r)   |  | First Amended Debtors Plan of Reorganization dated as of February 12, 2003. (11)                                                                                                                                                                                          
|        |  |                                                                                                                                                                                                                                                                            
|10(s)   |  | Disclosure Statement to Accompany Debtors First Amended Plan of Reorganization.
(11)                                                                                                                                                                                       
|        |  |                                                                                                                                                                                                                                                                            
|21      |  | List of subsidiaries of the Company.(3)                                                                                                                                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                            
|24      |  | Power of Attorney. (12)                                                                                                                                                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                            
|99.1    |  | Certification pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                     
|        |  |                                                                                                                                                                                                                                                                            
|99.2    |  | Certification pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                     



---

|(1)  |  | Incorporated by reference to the Companys Registration Statement
on Form S-1, File No. 33-94624, which became effective on December
13, 1995.
|---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------
|    
|(2)  |  | Incorporated by reference to the Companys Report on Form 8-K, SEC
File No. 0-26518, filed January 12, 1998.                                  
|    
|(3)  |  | Incorporated by reference to the Companys Report on Form 10-K, SEC
File No. 0-26518, filed March 31, 1998.                                   
|    
|(4)  |  | Incorporated by reference to the Companys Report on Form 10-Q,
SEC. File No. 0-26518, filed June 28, 1998.                                   
|    
|(5)  |  | Incorporated by reference to the Companys Report on Form 10-K, SEC
File No. 0-26518, filed March 30, 1999.                                   
|    
|(6)  |  | Incorporated by reference to the Companys Report on Form 10-Q, SEC
File No. 0-26518, filed August 17, 1999.                                  
|    
|(7)  |  | Incorporated by reference to the Companys Report on Form 10-Q, SEC
File No. 0-26518, filed November 10, 1999.                                
|    
|(8)  |  | Incorporated by reference to the Companys Report on Form 8-K, SEC
File No. 0-26518, filed December 7, 2000.                                  
|    
|(9)  |  | Incorporated by reference to the Companys Report on Form 8-K, SEC
File No. 0-26518, filed December 19, 2001.                                 
|    
|(10) |  | Incorporated by reference to the Companys Report on Form 10-K, SEC
File No. 0-26518, filed April 15, 2002.                                   
|    
|(11) |  | Incorporated by reference to the Companys Report on Form 10-K, SEC
File No. 0-26518, filed February 27, 2003.                                
|    
|(12) |  | Filed herewith.                                                                                                                               

E-4