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

                             FORM 10-K

(Mark One)

[x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended    December 31, 1998      
                          ----------------------------------------
                                 OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934
For the transition period from                 to                 
                               ---------------    ----------------
              Commission file number   1-5440        
                                     ----------------
                         AZTAR CORPORATION
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      (Exact name of registrant as specified in its charter)

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

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

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

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

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

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

                               None

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

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

    The aggregate market value of the voting common equity held by non-
affiliates of the registrant was $216,839,628 at March 1, 1999 and is based
on a closing price of $4.8125 and 45,057,585 common shares outstanding.

    At March 1, 1999, the registrant had outstanding 45,339,401 shares of
its common stock, $.01 par value.

                DOCUMENTS INCORPORATED BY REFERENCE

    Certain information contained in the registrant's 1999 definitive Proxy
Statement, to be filed with the Commission, is incorporated by reference
into this Form 10-K.  The following cross-referenced index details the
location of such information.  All other sections of the 1999 Proxy
Statement are not required in Form 10-K and should not be considered a part
thereof.

Part and Item of the Form 10-K                   1999 Proxy Statement
------------------------------                   --------------------

            PART III
            --------

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

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

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









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

The Company operates in major domestic gaming markets with casino hotel
facilities in Atlantic City, New Jersey, and Las Vegas and Laughlin,
Nevada.  The Company operates riverboat casinos in Caruthersville,
Missouri, and Evansville, Indiana.  The Company is an experienced developer
and operator of casinos that provide an excellent gaming environment for
middle- to upper-tier customers.

TROPICANA ATLANTIC CITY

Tropicana Casino and Resort encompasses approximately 10 acres and has
ocean beach frontage of 220 yards along the Boardwalk in Atlantic City. 
Tropicana Atlantic City's approximate 124,000-square-foot casino contains
3,700 slot machines and 172 table games, a baccarat lounge, a poker room
and keno.  The Tropicana Atlantic City complex contains 1,624 hotel rooms
and approximately 47,000 square feet of meeting, convention and banquet
space.  The facility also includes parking for 3,300 vehicles and a 1,700-
seat theatrical showroom which regularly presents headliner entertainment. 
Other amenities include four gourmet restaurants, several medium-priced
restaurants, indoor and outdoor swimming pools, tennis courts, a health and
fitness club and a jogging track.

The Atlantic City gaming market has demonstrated continued growth despite
the proliferation of new gaming venues across the country.  The 12 hotel
casinos in Atlantic City generated approximately $4.0 billion in gaming
revenues in 1998, a 3% increase over 1997.  There are plans for the
expansion of existing gaming capacity in Atlantic City, as well as the
development of new gaming projects.  Major casino operators have announced
plans to develop projects in the Marina and Boardwalk areas; however, these
are not expected to open for a few years.

TROPICANA LAS VEGAS

Tropicana Resort and Casino is located on a 34-acre site at the
intersection of Las Vegas Boulevard (the famed Strip) and Tropicana Avenue
(known as the "New Four Corners") in Las Vegas, Nevada.  The New Four
Corners area of Las Vegas contains the MGM Grand, Excalibur, Luxor, Monte
Carlo and New York-New York mega-resorts.  Tropicana Las Vegas has one of
the world's largest indoor/outdoor swimming pools, as well as a five-acre
water park and tropical garden.  The casino occupies approximately 85,000
square feet and contains 1,686 slot machines and 49 table games.  The hotel
has 1,872 rooms and suites as well as approximately 100,000 square feet of 



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convention and exhibit space, plus an array of fine restaurants and
extensive parking.  Tropicana Las Vegas is home for the Folies Bergere, the
longest-running production show in Las Vegas.

The Las Vegas gaming market consisted of approximately 110,000 hotel rooms
at the end of 1998.  Gaming revenue in Las Vegas grew to $5.0 billion in
1998, a 2% increase over 1997.  In October 1998, a new mega-resort named
Bellagio opened on the Strip.  Three additional mega-resorts containing
approximately 10,000 rooms have announced openings on the Strip for 1999. 
These three are known as Mandalay Bay, Venetian and Paris.

The Tropicana Las Vegas site and facility are leased by the Company from an
unconsolidated partnership in which the Company has a 50% interest.  On
February 2, 1998, the Company acquired an option to purchase the 50%
partnership interest that it does not own.  On February 1, 1999, the
Company amended this option.  The amended option agreement gives the
Company an unconditional right, but not the obligation, to purchase the
partnership interest for $120 million until as late as February 1, 2002. 
The Company has engaged an investment bank to explore alternatives for a
major redevelopment of the property.  The amount and timing of any future
expenditure, and the extent of any impact on existing operations, will
depend on the nature of the redevelopment ultimately undertaken by the
Company.

RAMADA EXPRESS

Ramada Express Hotel and Casino is located on approximately 28 acres in
Laughlin, Nevada, which is situated on the Colorado River at Nevada's
southern tip.  The facility features a Victorian-era railroad theme, which
includes a train that carries guests between the parking areas and the
casino hotel.  Ramada Express has 1,500 hotel rooms; a 50,000-square-foot
casino containing 1,580 slot machines and 33 table games; a 1,100-vehicle
parking garage; additional surface parking for 1,200 vehicles; three
restaurants and a lounge; and special event and retail space.

The Laughlin gaming market consists of approximately 11,000 rooms and its
gaming revenues for 1998 were $0.5 billion, a 2% increase over 1997.  This
increase in 1998 follows four years of declining gaming revenues for this
market.

CASINO AZTAR EVANSVILLE 

Casino Aztar Evansville operates on the Ohio River in Evansville, Indiana. 
The casino riverboat is certified to carry 2,700 passengers and a crew of
300.  The facility contains approximately 37,250 square feet of casino
space with 1,319 slot machines and 72 table games.  Casino Aztar Evansville
has a 250-room hotel, a 1,600-space parking garage and a pavilion for 
passenger ticketing that contains three restaurants, a sidewalk cafe, an
entertainment lounge and a gift shop.

There are three other riverboats operating in Southern Indiana on the Ohio
River.  Two of these riverboats operate in the Cincinnati, Ohio market area
and one riverboat opened in November 1998 in the Louisville, Kentucky
market area.  A certificate of suitability has been granted to operate a
riverboat between the Louisville area and the Cincinnati area.  This
riverboat is anticipated to open in mid- to late-2000.  Gaming revenue in
the Southern Indiana market grew by 46% in 1998 to $0.5 billion.

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CASINO AZTAR CARUTHERSVILLE 

Casino Aztar Caruthersville operates on a 37-acre site on the Mississippi
River in Caruthersville, Missouri near Interstates 55 and 155.  The casino
riverboat has a capacity of 800 passengers plus crew and contains
approximately 10,400 square feet of casino space with 461 slot machines and
22 table games.  A passenger pavilion provides ticketing and pre-boarding
facilities, including a restaurant, a sports lounge, a snack bar and other
amenities.  In addition, a climate-controlled pavilion and an outdoor arena
are used for exhibitions, entertainment, rodeo competitions and other
events.  The Company has some unused land at this site and is searching for
development opportunities with other entities to use the land for
facilities that would complement the Company's operations.  Other main
elements are a barge at river's edge for passenger boarding and
disembarking, and parking for more than 1,000 vehicles, including
recreational vehicles.

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

YEAR 2000

The information concerning the Year 2000 is included in this report on
pages F-50 through F-53 under the caption "Year 2000".

COMPETITION AND SEASONALITY

  Competition

The Company faces intense competition in each of the markets in which its
land-based gaming facilities are located from other companies in the gaming
industry, some of which have significantly greater financial resources than
the Company.  Such competition results, in part, from the geographic
concentration of competitors.  All of the Company's land-based casinos
primarily compete with other casinos in their immediate geographic area.
The Company's Caruthersville riverboat casino primarily competes with a
riverboat casino in Metropolis, Illinois and riverboat casinos in
Mississippi that attract residents of its secondary Memphis, Tennessee
market.  Casino Aztar Caruthersville also competes to a lesser extent with
riverboat casinos in other cities in Missouri, none of which are in its
primary 60-mile radius market area.  Casino Aztar Evansville primarily
competes with an Indiana riverboat in the Louisville, Kentucky market area
that opened in November 1998 and the riverboat casino in Metropolis,
Illinois.  Casino Aztar Evansville also competes with other Indiana
riverboat casinos on the Ohio River in the Cincinnati, Ohio market area and
to a lesser extent with riverboat casinos in other Indiana locations, none
of which are in its primary 50-mile radius market area.  All of the
Company's casinos compete to a lesser extent with casinos in other
locations, including Native American lands and on cruise ships, and with
other forms of legalized gaming in the United States, including state-
sponsored lotteries, off-track wagering and card parlors.  Several
additional states have considered legalizing casino gaming and others may
in the future.  Legalization of large-scale, unlimited casino gaming in or 


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<PAGE>
near any major metropolitan area or increased gaming in other areas could
have an adverse economic impact on the business of any or all of the
Company's gaming facilities.  There can be no assurance that the Company
will be able to compete successfully in these markets.

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

Since the Mirage opened in late 1989, several other major casino hotels
have been opened on the Strip.  In addition, casino hotels have opened or
have been expanded in other parts of Las Vegas or near Las Vegas.  Downtown
Las Vegas has added the "Fremont Street Experience" that provides a cover
for the street and light show in order to attract customers.  Four  major
casino hotels on the Strip are under construction, of which three are
expected to open in 1999, and announcements have been made for other new
developments.  The experience through 1998 has been that these new
developments have expanded the Las Vegas gaming market.  There can be no
assurance, however, that the increased competition from the new casinos
will not have an adverse effect on Tropicana Las Vegas.

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

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




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management the flexibility to match the promotions of competitors, the
number of the Company's casino patrons may decline, with an adverse effect
on its financial performance.  

  Seasonality

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

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

CREDIT POLICY AND CONTROL PROCEDURES

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

Gaming operations at the casinos are subject to risk of substantial loss as
a result of employee or patron dishonesty, credit fraud or illegal slot
machine manipulation.  The Company has in place stringent control
procedures to minimize such risks; however, there can be no assurance that
losses will not occur.  Current controls include supervision of employees,
monitoring by electronic surveillance equipment and use of two-way mirrors.
In New Jersey, the Company's activities are observed and monitored on an
ongoing basis by agents of both the New Jersey Casino Control Commission
and the New Jersey Division of Gaming Enforcement, each of which maintains
a staff on the premises of Tropicana Atlantic City.  Similarly, in Nevada 

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the Company's gaming subsidiaries must comply with certain regulatory
requirements concerning casino and game security and surveillance, and the
gaming operations of Tropicana Las Vegas and Ramada Express are subject to
routine audit and supervision by agents of the Nevada State Gaming Control
Board.  In Missouri and Indiana, the Company's casino riverboat operations
are subject to the control procedures of the Missouri Gaming Commission and
the Indiana Gaming Commission, respectively.  The Missouri Gaming
Commission maintains a staff at Casino Aztar Caruthersville and the Indiana
Gaming Commission maintains a staff at Casino Aztar Evansville.

REGULATION

  General

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

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

  Regulation and Licensing - Nevada

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



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

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

The Nevada Gaming Authorities may investigate any individual who has a
material relationship to, or material involvement with, the Company, HRN or
Express in order to determine whether such individual is suitable or should
be licensed as a business associate of a gaming licensee.  Officers,
directors and certain key employees of HRN and Express must file
applications with the Nevada Gaming Authorities and may be required to be
licensed or found suitable by the Nevada Gaming Authorities.  Officers,
directors and key employees of the Company who are actively and directly
involved in gaming activities of HRN and Express may be required to be
licensed or found suitable by the Nevada Gaming Authorities.  The Nevada
Gaming Authorities may deny an application for licensing for any cause
which they deem reasonable.  A finding of suitability is comparable to
licensing, and both require submission of detailed personal and financial
information followed by a thorough investigation.  The applicant for
licensing or a finding of suitability must pay all the costs of the
investigation.  Changes in licensed positions must be reported to the
Nevada Gaming Authorities and in addition to their authority to deny an
application for a finding of suitability or licensure, the Nevada Gaming
Authorities have jurisdiction to disapprove a change in a corporate
position.

If the Nevada Gaming Authorities were to find an officer, director or key
employee unsuitable for licensing or unsuitable to continue having a
relationship with the Company, HRN or Express, the companies involved would
have to sever all relationships with such person.  In addition, the Nevada 

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Commission may require the Company, HRN or Express to terminate the
employment of any person who refuses to file appropriate applications. 
Determinations of suitability or of questions pertaining to licensing are
not subject to judicial review in Nevada.

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

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

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

The Nevada Act requires any person who acquires more than 5% of the
Company's voting securities to report the acquisition to the Nevada
Commission.  The Nevada Act requires that beneficial owners of more than
10% of the Company's voting securities apply to the Nevada Commission for a
finding of suitability within thirty days after the Chairman of the Nevada
Board mails the written notice requiring such filing.  Under certain
circumstances, an "institutional investor," as defined in the Nevada Act,
which acquires more than 10%, but not more than 15%, of the Company's
voting securities may apply to the Nevada Commission for a waiver of such
finding of suitability if such institutional investor holds the voting
securities for investment purposes only.  An institutional investor shall
not be deemed to hold voting securities for investment purposes unless the
voting securities were acquired and are held in the ordinary course of
business as an institutional investor and not for the purpose of causing,
directly or indirectly, the election of a majority of the members of the
board of directors of the Company, any change in the Company's corporate
charter, bylaws, management, policies or operations of the Company, or any
of its gaming affiliates, or any other action which the Nevada Commission
finds to be inconsistent with holding the Company's voting securities for
investment purposes only.  Activities which are not deemed to be
inconsistent with holding voting securities for investment purposes only
include: (i) voting on all matters voted on by stockholders; (ii) making
financial and other inquiries of management of the type normally made by 

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securities analysts for informational purposes and not to cause a change in
its management, policies or operations; and (iii) such other activities as
the Nevada Commission may determine to be consistent with such investment
intent.  If the beneficial holder of voting securities who must be found
suitable is a corporation, partnership or trust, it must submit detailed
business and financial information including a list of beneficial owners. 
The applicant is required to pay all costs of investigation.

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

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

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




                                     11
<PAGE>
The Company may not make a public offering of any securities without the
prior approval of the Nevada Commission if the securities or the proceeds
therefrom are intended to be used to construct, acquire or finance gaming
facilities in Nevada, or to retire or extend obligations incurred for such
purposes.  Such approval, if given, does not constitute a finding,
recommendation or approval by the Nevada Commission or the Nevada Board as
to the accuracy or adequacy of the prospectus or the investment merits of
the securities.  Any representation to the contrary is unlawful.

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

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

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

                                     12
<PAGE>
the number of gaming devices operated; or (iii) the number of table games
operated.  A casino entertainment tax is also paid by HRN and Express where
entertainment is furnished in connection with the selling of food,
refreshments or merchandise in a cabaret, nightclub, cocktail lounge or
casino showroom.

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

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

  Regulation and Licensing - New Jersey

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

The New Jersey Act and regulations concern primarily the financial
stability and character of casino licensees, their intermediary and holding
companies, their employees, their security holders and others financially
interested in casino operations, the nature of hotel and casino facilities
and a wide range of gaming and non-gaming related operations.  The New
Jersey Act and regulations include detailed provisions concerning, among
other things, financial and accounting practices used in connection with
casino operations, residence and equal employment opportunities for
employees of casino operators, contractors for casino facilities and
others; rules of games, levels of supervision of games and methods of
selling and redeeming chips; manner of granting credit, duration of credit
and enforceability of gaming debts; manufacture, distribution and sale of
gaming equipment; security standards, management control procedures,
accounting and cash control methods and reports to gaming authorities;
advertising of casinos and standards for entertainment and distribution of 

                                     13
<PAGE>
alcoholic beverages in casinos.  A number of these provisions require
practices which are different from those in Nevada and some of them result
in casino operating costs being higher than those in comparable facilities
in Nevada.

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

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

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

The New Jersey Act further provides that each person who directly or
indirectly holds any beneficial interest or ownership of the securities
issued by a casino licensee or any of its intermediary or holding
companies, those persons who, in the opinion of the New Jersey Commission,
have the ability to control the casino licensee or its intermediary or
holding companies or elect a majority of the board of directors of said
companies, other than a banking or other licensed lending institution which
makes a loan or holds a mortgage or other lien acquired in the ordinary
course of business, and lenders and underwriters of said companies may be
required to seek qualification from the New Jersey Commission. However,
because the Company is a publicly traded holding company, in accordance
with the provisions of the New Jersey Act, a waiver of qualification may be
granted by the New Jersey Commission, with the concurrence of the Director
of the New Jersey Division, if it is determined that said persons or
entities are not significantly involved in the activities of Adamar and, in
the case of security holders, do not have the ability to control the
Company or elect one or more of its directors.  There exists a rebuttable 


                                     14
<PAGE>
presumption that any person holding 5% or more of the equity securities of
a casino licensee's intermediary or holding company or a person having the
ability to elect one or more of the directors of such a company has the
ability to control the company and thus must obtain qualification from the
New Jersey Commission.

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

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

The New Jersey Act further requires that corporate licensees and their
subsidiaries, intermediaries and holding companies adopt certain provisions
in their certificates of incorporation that require certain remedial action
in the event that an individual owner of any security of such company is
found disqualified under the New Jersey Act.  The required certificate of
incorporation provisions vary depending on whether the stock of the company
subject to the requirements of the New Jersey Act is publicly or privately 


                                     15
<PAGE>
traded.  Pursuant to the New Jersey Act, the certificate of incorporation
of a publicly held company must provide that any securities of such
corporation are held subject to the condition that if a holder is found to
be disqualified by the New Jersey Commission pursuant to the New Jersey Act
such holder shall dispose of his interest in such company.  The certificate
of incorporation of a privately held company must create the absolute right
of the company to repurchase at the market price or purchase price,
whichever is the lesser, any security, share or other interest in the
company in the event the New Jersey Commission disapproves a transfer in
accordance with the provisions of the New Jersey Act.

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

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

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

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

The New Jersey Act imposes an annual tax of eight percent on gross revenues
(as defined in the New Jersey Act).  In addition, casino licensees are
required to invest one and one-quarter percent of gross casino revenues for
the purchase of bonds to be issued by the Casino Reinvestment Development
Authority or make other approved investments equal to that amount; in the
event the investment requirement is not met, the casino licensee is subject
to a tax in the amount of two and one-half percent on gross revenues.





                                     16
<PAGE>
  Regulation and Licensing - Missouri

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

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

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

Opponents of gaming in Missouri have brought several legal challenges to
gaming in the past and may possibly bring similar challenges in the future. 
On November 25, 1997, the Missouri Supreme Court overturned a state lower
court and held that a portion of the Missouri Gaming Law that authorized
excursion gaming facilities in "artificial basins" up to 1,000 feet from
the Mississippi or Missouri rivers was unconstitutional.  This ruling
created uncertainty as to the legal status of several excursion gaming
riverboat facilities in the state; however, as Aztar Missouri facilities
were fully on the Mississippi River, they did not appear to be affected. 
On November 3, 1998, a statewide referendum was held, whereby the voters
amended the constitution to allow "artificial basins" for existing
facilities, effectively overturning the above Missouri Supreme Court
decision.  There can be no assurances that any future challenges, if
brought, would not further interfere with full-scale gaming operations in
Missouri, including the operations of Aztar Missouri.

Under the Missouri Gaming Law, the ownership and operation of riverboat
gaming facilities in Missouri are subject to extensive state and local 

                                     17
<PAGE>
regulation.  Aztar, Aztar Missouri, any subsidiaries, and certain of their
officers and employees are and will be subject to certain regulations.  As
part of the application and licensing process for a gaming license, the
applicant must submit detailed financial, operating and other reports to
the Missouri Gaming Commission.  Each applicant has an ongoing duty to
update the information provided to the Missouri Gaming Commission in the
application.  Aztar Missouri has frequently updated its application
materials since it was initially licensed.  In addition to the information
required of the applicant, directors, officers and other key persons must
submit Personal Disclosure Forms which include detailed personal financial
information and are subject to thorough investigations.  In addition,
certain officers and directors of Aztar, as well as Aztar itself, have
submitted Personal Disclosure Forms and applications to the Missouri Gaming
Commission.  All gaming employees must obtain an occupational license
issued by the Missouri Gaming Commission.

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

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

The Missouri Gaming Commission may revoke or suspend gaming licenses and
impose other penalties for violations of the Missouri Gaming Law and the
rules and regulations promulgated thereunder, including without limitation,
forfeiture of all gaming equipment used for improper gaming and fines of up
to three times an operator's highest daily gross adjusted receipts during
the preceding twelve months.  The gaming licenses may not be transferred
nor pledged as collateral, and the Missouri Gaming Law regulations bar a
licensee from taking any of the following actions without prior notice to,
and approval by, the Missouri Gaming Commission: any issuance of an
ownership interest of five percent or more of the issued and outstanding
ownership interest, any private incurrence of debt by the licensee or any
holding company of $1,000,000 or more, any public issuance of debt by a
licensee or its holding company, and certain defined "significant related
party transactions".  In addition, the licensee must notify the Missouri
Gaming Commission of other transactions, including the transfer of five
percent or more of an ownership interest in the licensee or holding company
and any transaction of at least $1,000,000. The restrictions on transfer of
ownership apply to the Company as well as the direct licensee, Aztar
Missouri.



                                     18
<PAGE>
Missouri statutes and administrative rules contain detailed requirements
concerning the operation of a licensed excursion gaming boat facility. 
These include a charge of two dollars per gaming customer that licensees
must pay to the Missouri Gaming Commission, requirements regarding minimum
payouts, a 20% tax on adjusted gross receipts, prohibitions against
providing credit to gaming customers (except for the use of credit cards
and cashing checks) and a requirement that each licensee reimburse the
Missouri Gaming Commission for all costs of any Missouri Gaming Commission
staff necessary to protect the public on the licensee's riverboat. 
Licensees also must submit audited quarterly financial reports to the
Missouri Gaming Commission and pay the associated auditing fees.  Other
areas of operation which are subject to regulation under the Missouri rules
are the size, denomination and handling of chips and tokens; the
surveillance methods and computer monitoring of electronic games;
accounting and audit methods and procedures; and approval of an extensive
internal control system.  The Missouri rules also require that all of an
operator's purchases must be from suppliers licensed by the Missouri Gaming
Commission.

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

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

  Regulation and Licensing - Indiana

The ownership and operation of riverboat casinos in certain designated
waters are subject to extensive state regulation under the Indiana
Riverboat Gambling Act (the "Indiana Act") and regulations which the
Indiana Gaming Commission is authorized to adopt under the Indiana Act. 
The Indiana Act and the regulations of the Indiana Gaming Commission are
significant to the Company's prospects for successfully operating its
Evansville, Indiana based riverboat casino and associated developments.

                                     19
<PAGE>
The Indiana Act extends broad and pervasive regulatory powers and authority
to the Indiana Gaming Commission.  The Indiana Gaming Commission took
office in September 1993, and its activities have been predominantly
directed toward establishing a regulatory and administrative infrastructure
for licensing of prospective applicants for the limited number of riverboat
owner's licenses authorized by the Indiana Act (five for operations docking
on Lake Michigan, one on a landlocked lake in Southwestern Indiana and five
on the Ohio River, including the Company's facility in Evansville,
Indiana), and on developing systems and "rules of the game" for the actual
operation of riverboat casinos.  The Indiana Gaming Commission has issued
(i) the five authorized riverboat owner's licenses on Lake Michigan, (ii)
four riverboat owner's licenses on the Ohio River, including the Company's
facility, and (iii) a certificate of suitability to another applicant for a
fifth facility, subject to final licensure, on the Ohio River.  The Indiana
Gaming Commission has not considered applicants for the license on Patoka
Lake in Southwestern Indiana, since that site has been determined by the
United States Army Corps of Engineers to be unsuitable for a riverboat
casino project.  A licensee may own no more than a 10% interest in any
other owner's license under the Indiana Act.  The Indiana Commission has
adopted regulations under the Indiana Act which covers numerous operational
matters concerning riverboat casinos licensed by the Commission, including
rules for authorized games, internal control procedures, accounting
records, security, gaming equipment, and extensions of credit. 

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

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


                                     20
<PAGE>
entering Kentucky waters, under its currently approved cruising route,
thereby avoiding those issues.

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

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

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

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

                                     21
<PAGE>
three alcoholic beverage permits which are subject to annual renewal: one
for riverboat excursions and two for land support facilities.  All building
permits and other approvals for the permanent facilities have been
received, and the project is complete.

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

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

Minimum and maximum wagers on games on the riverboat are left to the
discretion of the licensee.  Wagering may not be conducted with money or
other negotiable currency.  No person under the age of 21 is permitted to
wager on a riverboat.

An institutional investor which acquires 5% or more of any class of voting
securities of a holding company of a licensee is required to notify the
Indiana Gaming Commission and to provide additional information, and may be
subject to a finding of suitability.  A person who acquires 5% or more of
any class of voting securities of a holding company of a licensee is
required to apply to the Indiana Gaming Commission for a finding of
suitability.  A riverboat licensee or an affiliate may not enter into a
debt transaction of $1 million or more without approval of the Indiana
Gaming Commission.  The Company received approval from the Indiana Gaming
Commission in March 1998 for a senior secured reducing revolving credit
facility and for a senior secured term loan for a combined total of up to
$350 million.  A riverboat owner's license is a revocable privilege and is
not a property right under the Indiana Act.  A riverboat owner licensee or
any other person may not lease, hypothecate, borrow money against or loan
money against a riverboat owner's license.

Pursuant to agreements with the City of Evansville, as reflected in the
owner's license issued to the Company, the Company agreed to certain fixed
commitments to the City of Evansville.  In lieu of the Company contributing
the remaining $2 million for the Dress Plaza, the Company donated two 

                                     22
<PAGE>
parcels of real estate on Main Street to the City of Evansville in January
1997, and the Indiana Gaming Commission had no objection to this
transaction.

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

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

  Environmental Matters

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

  Other Regulations

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


                                     23
<PAGE>
EMPLOYEES

The Company employs approximately 10,800 people, of which approximately
3,300 employees are represented by unions.  Of the approximately 5,000
employees at Tropicana Atlantic City, approximately 1,800 are covered by
collective bargaining contracts.  Substantially all of such employees are
covered by a contract that expires on September 14, 1999 and a small number
are covered by contracts that expire in 2001.  At Tropicana Las Vegas,
approximately 1,500 of the 2,600 employees are covered by collective
bargaining contracts.  Substantially all of such employees are covered by
contracts that expire in 2002 and a small number of such employees are
covered by contracts that expire on March 31, 1999 and July 31, 1999.  The
remainder of such employees are covered by contracts that expire in 2000 or
2003.  At Ramada Express there are approximately 1,500 employees, none of
which are covered by collective bargaining agreements.  The Company has
approximately 1,200 employees and 400 employees, respectively, at Casino
Aztar Evansville and Casino Aztar Caruthersville, none of which are covered
by collective bargaining agreements.

TRADEMARKS

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

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

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

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

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

Tropicana Atlantic City is located on an approximate 10-acre site in
Atlantic City, New Jersey.  In July 1993, Tropicana Atlantic City became
wholly owned by the Company.  The Company has accumulated approximately 
3 1/2 acres next to its operating site for future development.




                                     24
<PAGE>
     TROPICANA LAS VEGAS

Tropicana Las Vegas is located on a 34-acre site in Las Vegas, Nevada. 
Tropicana Las Vegas is owned by Tropicana Enterprises and is leased to HRN,
which operates the casino and hotel under the lease ( the "Tropicana
Lease"), which expires in 2011.  The Company, through its wholly-owned
subsidiary, Adamar of Nevada, owns a noncontrolling 50% general partnership
interest in Tropicana Enterprises.  The remaining 50% general partnership
interest in Tropicana Enterprises is held by various individuals and trusts
associated with the Jaffe family subject to certain preferences on
liquidation.  On February 2, 1998, the Company acquired an option to
purchase the 50% partnership interest that it does not own.  On February 1,
1999, the Company amended this option.  The amended option agreement gives
the Company an unconditional right, but not the obligation, to purchase the
partnership interest for $120 million until as late as February 1, 2002. 
The Company has engaged an investment bank to explore alternatives for a
major redevelopment of the property.  The amount and timing of any future
expenditure, and the extent of any impact on existing operations, will
depend on the nature of the redevelopment ultimately undertaken by the
Company.

     RAMADA EXPRESS

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

     CASINO AZTAR EVANSVILLE

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

     CASINO AZTAR CARUTHERSVILLE

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

     GENERAL

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

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

ITEM 3.  LEGAL PROCEEDINGS
--------------------------
The Company and more than 40 other major casino operators, as well as
various manufacturers and distributors of video poker and electronic slot
machines, have been named as defendants in an action originally filed in 


                                     25
<PAGE>
the United States District Court for the Middle District of Florida,
Orlando Division, entitled William H. Poulos, On Behalf of Himself and All
Others Similarly Situated v. Caesars World, Inc., et al., Case No. 94-478-
CIV-ORL-22, filed on April 26, 1994.  This action was consolidated with
another subsequently filed action in that court entitled William Ahearn, On
Behalf of Himself and All Others Similarly Situated v. Caesars World, Inc.,
et al., Case No. 94-532-CIV-ORL-22 (the "Actions" or collectively, the
"Poulos/Ahearn Case").  Both Actions were brought under RICO and state
common law and seek compensatory and punitive damages in excess of $1
billion from the defendants.  The complaints allege that the defendants
took part in a scheme intended to induce people to play video poker and
electronic slot machines based on false beliefs concerning how those
machines actually operate as well as the extent to which there is actually
an opportunity to win on any given play.  The precise nature of the
Company's alleged role in the alleged fraud and conspiracy to defraud is
not discernible from the complaints.

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

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

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

On September 26, 1995, an action entitled Larry Schreier, On Behalf of
Himself and All Others Similarly Situated v. Caesars World, Inc., et al.,
Case No. CV-S-95-00923-DWH(RJJ)(the "Schreier Case") was commenced in the
United States District Court for the District of Nevada.  The case was
thereafter transferred to District Judge Lloyd D. George and assigned the
Case No. CV-S-95-00923-LDG(RJJ).  The Schreier Case is identical to the
Poulos/Ahearn Case in all material respects, except that the named
plaintiff in the Schreier Case purports to represent a smaller and more
precisely defined class of persons than the plaintiffs in the Poulos/Ahearn
Case.  The defendants (including the Company) moved to dismiss the Schreier
complaint on the same grounds as in the previously described Poulos/Ahearn
Case, as well as on the ground that this case was filed for an improper
purpose, an attempt to circumvent prior rulings of the Court in the 

                                     26
<PAGE>
Poulos/Ahearn Case.  On August 15, 1996, District Judge Lloyd D. George
granted the motion to dismiss, without prejudice.  An amended complaint
containing the same principal allegations was filed on September 30, 1996. 
The defendants (including the Company) filed motions to dismiss the amended
complaint for failure to state a claim and on other grounds.  The Plaintiff
opposed these motions.

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

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

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

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

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

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

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

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

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

The plaintiffs in the Consolidated Cases filed a second consolidated
amended complaint on January 9, 1998.  The second consolidated amended
complaint contains claims which are nearly identical to those in the
previously dismissed complaints.  The defendants answered, denying the
substantive allegations of the second consolidated amended complaint.  The
parties have submitted an updated case management order which has been
approved, in part, by the court.  On March 18, 1998, the plaintiffs filed a
motion for class certification.  On March 19, 1998, the Magistrate Judge
granted defendants' motion seeking to bifurcate discovery into "class" and
"merits" phases, and to stay "merits" discovery pending a decision on
plaintiffs' motion for class certification.  "Class" discovery was 

                                     27
<PAGE>
completed on July 17, 1998; however, plaintiffs have filed a motion to
compel further discovery from the defendants.  The Magistrate Judge has
recommended denial of that motion, and the plaintiffs have sought review of
that recommendation by the Judge.  The defendants have opposed the review
sought by the plaintiffs.  If that motion is granted, defendants could be
required to provide additional documents and information to plaintiffs. 
The defendants filed their opposition to the motion for class
certification.  The plaintiffs have filed a reply memorandum and the matter
has been submitted to the judge for decision.  The stay of merits discovery
remains in effect until the court decides the motion for class
certification.

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

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

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
------------------------------------------------------------
None

EXECUTIVE OFFICERS OF THE REGISTRANT
------------------------------------
     The registrant has elected not to include information concerning its
executive officers in its 1999 Proxy Statement, as allowed by the Proxy
Statement instructions.  The registrant relies on General Instruction G(3)
of this report on Form 10-K in presenting the following information on its
executive officers.
                                                             Tenure      
                                                        -----------------
                                                           With   Present
       Name                     Office             Age   Company  Position
-------------------  ----------------------------  ---  --------  --------
Paul E. Rubeli       Chairman of the Board,        55   20 years  7 years
                     President and Chief
                     Executive Officer 
                     
Robert M. Haddock    Executive Vice President      54   18 years 12 years
                     and Chief Financial
                     Officer

Nelson W. Armstrong, 
 Jr.                 Vice President,               57   26 years  9 years
                     Administration, and Secretary

Joe C. Cole          Vice President,               60   11 years 11 years
                     Corporate Communications

Meridith P. Sipek    Controller                    52   21 years  9 years

Neil A. Ciarfalia    Treasurer                     51    4 years  4 years

                                     28
<PAGE>
EXECUTIVE OFFICERS OF THE REGISTRANT (continued)
------------------------------------------------
Paul E. Rubeli.  Mr. Rubeli joined Ramada in 1979 as Group Vice President,
Industrial Operations.  He served as Executive Vice President, Gaming, of
Ramada from 1982 to December 1989, when he was appointed President and Chief
Operating Officer, of the Company in the Restructuring.  He was appointed
President and Chief Executive Officer in February 1990 and was appointed
Chairman of the Board in addition to his other positions in February 1992.

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

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

Joe C. Cole.  Mr. Cole joined Ramada in March 1988 as Vice President,
Corporate Communications, after having been affiliated with Phoenix Newspapers
Inc. for 26 years as a reporter, columnist and editor.  He became Vice
President, Corporate Communications, of the Company in the Restructuring.

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

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

                                    PART II
                                    -------

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
------------------------------------------------------------------------------
Aztar had 9,400 shareholders of record as of March 1, 1999. 

The additional information required by this Item 5 is included in this report
on F-18, F-32, F-42 and F-56.

ITEM 6. SELECTED FINANCIAL DATA
-------------------------------
The information required by Item 6 is included in this report on page F-56.








                                      29
<PAGE>
ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
------------------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------
The information required by Item 7 is included in this report on pages F-42
through F-55.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
--------------------------------------------------------------------

The information required by Item 7A is included in this report on pages F-49
and F-50 under the caption "Market Risk".

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

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

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

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

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

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

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





                                      30
<PAGE>
                                    PART IV
                                    -------

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

(a)  1.  Financial Statements:

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

     2.   Financial Statement Schedules:

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

     3.  Exhibits:

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

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

(b)  Reports on Form 8-K:

         The Company did not file any report on Form 8-K during the
         quarter ended December 31, 1998.

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

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









                                      31
<PAGE>
                                  SIGNATURES
     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.

     AZTAR CORPORATION  By ROBERT M. HADDOCK            March 9, 1999
     -----------------     -------------------------   ------------------
     Registrant            Robert M. Haddock                   Date
                           Executive Vice President and
                           Chief Financial Officer

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

PAUL E. RUBELI               Chairman of the Board, President   March 9, 1999
-------------------------    and Chief Executive Officer, and ----------------
Paul E. Rubeli               Director

ROBERT M. HADDOCK            Executive Vice President and       March 9, 1999
-------------------------    Chief Financial Officer, and     ----------------
Robert M. Haddock            Director

MERIDITH P. SIPEK            Controller                         March 9, 1999
-------------------------                                     ----------------
Meridith P. Sipek

JOHN B. BOHLE                Director                           March 9, 1999
-------------------------                                     ----------------
John B. Bohle

E. M. CARSON                 Director                           March 9, 1999
-------------------------                                     ----------------
Edward M. Carson

LINDA C. FAISS               Director                           March 9, 1999
-------------------------                                     ----------------
Linda C. Faiss

JOHN R. NORTON, III          Director                           March 9, 1999
-------------------------                                     ----------------
John R. Norton, III

ROBERT S. ROSOW              Director                           March 9, 1999
-------------------------                                     ----------------
Robert S. Rosow

R. SNELL                     Director                           March 9, 1999
-------------------------                                     ----------------
Richard Snell

TERENCE W. THOMAS            Director                           March 9, 1999
-------------------------                                     ----------------
Terence W. Thomas





                                      32
<PAGE>
                 INDEX TO FINANCIAL STATEMENTS AND SCHEDULES


I.  Financial Statements                                             Page
                                                                     ----

  1. Aztar Corporation and Subsidiaries


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

     Consolidated Balance Sheets at December 31, 1998 and 
       January 1, 1998 . . . . . . . . . . . . . . . . . . . . . . .  F-3

     Consolidated Statements of Operations for the years ended
       December 31, 1998, January 1, 1998 and January 2, 1997  . . .  F-5

     Consolidated Statements of Cash Flows for the years ended 
       December 31, 1998, January 1, 1998 and January 2, 1997. . . .  F-7

     Consolidated Statements of Shareholders' Equity for the 
       years ended December 31, 1998, January 1, 1998 and 
       January 2, 1997 . . . . . . . . . . . . . . . . . . . . . . .  F-9

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



  2. Tropicana Enterprises


     Report of Independent Accountants . . . . . . . . . . . . . . . F-33

     Balance Sheets at December 31, 1998 and January 1, 1998   . . . F-34

     Statements of Operations for the years ended December 31, 
       1998, January 1, 1998 and January 2, 1997 . . . . . . . . . . F-35

     Statements of Cash Flows for the years ended December 31, 
       1998, January 1, 1998 and January 2, 1997 . . . . . . . . . . F-36

     Statements of Partners' Capital for the years ended 
       December 31, 1998, January 1, 1998 and January 2, 1997. . . . F-37

     Notes to Financial Statements . . . . . . . . . . . . . . . . . F-38


II. Financial Statement Schedules - Aztar Corporation and Subsidiaries

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

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

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

                                     F-1
<PAGE>





REPORT OF INDEPENDENT ACCOUNTANTS


To the Shareholders and Board of Directors
Aztar Corporation

In our opinion, the accompanying consolidated balance sheets and the
related consolidated statements of operations, cash flows and shareholders'
equity present fairly, in all material respects, the financial position of
Aztar Corporation and Subsidiaries (the "Company") at December 31, 1998 and
January 1, 1998, and the results of their operations and their cash flows
for each of the three years in the period ended December 31, 1998, in
conformity with generally accepted accounting principles.  These financial
statements are the responsibility of the Company's management; our
responsibility is to express an opinion on these financial statements based
on our audits.  We conducted our audits of these statements in accordance
with generally accepted auditing standards which 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, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall
financial statement presentation.  We believe that our audits provide a
reasonable basis for the opinion expressed above.







PRICEWATERHOUSECOOPERS LLP






Phoenix, Arizona
February 3, 1999













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

<CAPTION>
                                                 December 31,  January 1,
                                                    1998          1998    
                                                 -----------   ----------
<S>                                            <C>            <C> 
Assets
Current assets:
 Cash and cash equivalents                      $    58,600    $   46,129 
 Accounts receivable, net                            31,496        44,133 
 Inventories                                          6,496         6,779 
 Prepaid expenses                                     9,234        10,374 
 Deferred income taxes, net                          15,957        11,403 
                                                 ----------    ---------- 
     Total current assets                           121,783       118,818 
        
Investments in and advances to 
  unconsolidated partnership                          8,437         9,375 
Other investments                                    21,005        22,319 
        
Property and equipment:
 Buildings, riverboats and equipment, net           778,420       802,230 
 Land                                                99,035        98,762 
 Construction in progress                             2,153         1,215 
 Leased under capital leases, net                     7,782           672 
                                                 ----------    ---------- 
                                                    887,390       902,879 

Deferred income taxes, net                               --           331 
Other deferred charges and assets                    39,087        37,774 
                                                 ----------    ---------- 
                                                 $1,077,702    $1,091,496 
                                                 ==========    ========== 
</TABLE>

















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

                                     F-3
<PAGE>
<TABLE>
                     AZTAR CORPORATION AND SUBSIDIARIES
                   CONSOLIDATED BALANCE SHEETS (continued)
                  ----------------------------------------
                      (in thousands, except share data)


<CAPTION>
                                                 December 31,   January 1, 
                                                     1998          1998    
                                                 -----------    ---------- 
<S>                                               <C>           <C>   
Liabilities and Shareholders' Equity
Current liabilities:
 Accounts payable and accruals                    $   52,935    $   56,939 
 Accrued payroll and employee benefits                26,208        23,630 
 Accrued interest payable                             12,608        13,167 
 Income taxes payable                                  3,185           896 
 Current portion of long-term debt                     2,537        27,166 
 Current portion of other long-term liabilities        2,921         2,931 
                                                  ----------    ---------- 
     Total current liabilities                       100,394       124,729 
        
Long-term debt                                       487,543       491,932 
Other long-term liabilities                           22,882        24,204 
Deferred income taxes                                  5,635            -- 
Contingencies and commitments
Series B ESOP convertible preferred stock 
 (redemption value $7,147 and $6,857)                  7,147         6,593 
        
Shareholders' equity:
 Common stock, $.01 par value (45,337,834 
   and 45,198,889 shares outstanding)                    492           491 
 Paid-in capital                                     412,528       412,029 
 Retained earnings                                    58,207        48,654 
 Less: Treasury stock                                (17,126)      (17,126)
       Unearned compensation                              --           (10)
                                                  ----------    ---------- 
     Total shareholders' equity                      454,101       444,038 
                                                  ----------    ---------- 
                                                  $1,077,702    $1,091,496 
                                                  ==========    ========== 

</TABLE>












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

                                     F-4
<PAGE>
<TABLE>
                      AZTAR CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
  For the Years Ended December 31, 1998, January 1, 1998 and January 2, 1997 
                      -----------------------------------
                     (in thousands, except per share data)
<CAPTION>
                                                 1998      1997      1996   
                                              ---------  --------- ---------
<S>                                           <C>        <C>       <C>
Revenues
  Casino                                      $666,360   $645,604  $652,707
  Rooms                                         56,064     53,126    47,977
  Food and beverage                             52,671     51,776    51,299
  Other                                         31,041     31,851    25,489
                                              --------   --------  --------
                                               806,136    782,357   777,472

Costs and expenses
  Casino                                       300,625    298,104   314,732
  Rooms                                         31,912     30,258    27,931
  Food and beverage                             53,714     54,736    53,249
  Other                                         26,365     25,378    25,300
  Marketing                                     86,618     88,360    86,202
  General and administrative                    76,331     70,215    74,396
  Utilities                                     13,322     14,249    15,076
  Repairs and maintenance                       24,399     23,741    24,429
  Provision for doubtful accounts               14,913     12,944     5,892
  Property taxes and insurance                  23,425     24,093    23,285
  Rent                                          19,373     21,379    15,698
  Depreciation and amortization                 53,493     51,508    49,406
  Preopening costs                                  --         --     2,933
                                              --------   --------  --------
                                               724,490    714,965   718,529 
                                              --------   --------  --------
Operating income                                81,646     67,392    58,943

  Interest income                                2,154      2,026     2,367
  Interest expense                             (59,588)   (62,543)  (58,577)
                                              --------   --------  --------
Income before other items, income 
  taxes and extraordinary items                 24,212      6,875     2,733

  Equity in unconsolidated partnership's loss   (4,336)    (4,618)   (4,793)
                                              --------   --------  --------
Income (loss) before income taxes and
  extraordinary items                           19,876      2,257    (2,060)

  Income taxes                                  (8,368)     2,185    22,699
                                              --------   --------  --------
Income before extraordinary items               11,508      4,442    20,639

  Extraordinary items                           (1,346)        --        --
                                              --------   --------  --------

Net income                                    $ 10,162   $  4,442  $ 20,639
                                              ========   ========  ========
</TABLE>
[FN]
The accompanying notes are an integral part of these financial statements.

                                      F-5
<PAGE>
<TABLE>
                      AZTAR CORPORATION AND SUBSIDIARIES
               CONSOLIDATED STATEMENTS OF OPERATIONS (continued)
  For the Years Ended December 31, 1998, January 1, 1998 and January 2, 1997
                      -----------------------------------
                     (in thousands, except per share data)
<CAPTION>
                                             1998      1997      1996
                                           --------  --------  --------
<S>                                        <C>       <C>       <C>  
Earnings per common share:
  Income before extraordinary items        $    .24  $    .08  $    .48
  Extraordinary items                          (.03)       --        --
                                           --------  --------- --------

  Net income                               $    .21  $    .08  $    .48
                                           ========  ========  ========

Earnings per common share assuming 
  dilution:
  Income before extraordinary items        $    .23  $    .08  $    .46
  Extraordinary items                          (.03)       --        --
                                           --------  --------  --------
  Net income                               $    .20  $    .08  $    .46
                                           ========  ========  ========
  
Weighted-average common shares
  applicable to:
  Earnings per common share                  45,230    45,121    41,121
  Earnings per common share assuming 
    dilution                                 46,614    46,687    43,132




</TABLE>




















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

                                      F-6
<PAGE>
<TABLE>
                      AZTAR CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
  For the Years Ended December 31, 1998, January 1, 1998 and January 2, 1997
                                --------------
                                (in thousands)

<CAPTION>
                                              1998       1997       1996   
                                           ---------- ---------- ----------
<S>                                        <C>        <C>        <C>
Cash Flows from Operating Activities
Net income                                 $  10,162  $   4,442  $  20,639 
Adjustments to reconcile net income
  to net cash provided by operating 
  activities:
   Depreciation and amortization              55,735     54,216     52,478 
   Provision for losses on accounts 
     receivable                               14,913     12,944      5,892 
   Loss on reinvestment obligation                52        569        729 
   Rent expense                                 (900)      (984)      (732)
   Distribution in excess of equity in 
     income of partnership                       938        985      1,107 
   Deferred income taxes                       1,412       (184)   (22,451)
   Change in assets and liabilities:
    (Increase) decrease in accounts 
       receivable                               (387)   (15,128)   (23,701)
    (Increase) decrease in refundable 
       income taxes                               --      1,201         60 
    (Increase) decrease in inventories 
       and prepaid expenses                      847     (1,141)    (1,787)
    Increase (decrease) in accounts 
       payable, accrued expenses and 
       income taxes payable                       93     (8,324)     8,476 
    Other items, net                           3,536        893      7,429 
                                           ---------  ---------  --------- 
   Net cash provided by (used in) 
     operating activities                     86,401     49,489     48,139 
                                           ---------  ---------  --------- 
Cash Flows from Investing Activities
Payments received on notes receivable          1,493      1,310      1,150 
Reduction in other investments                 4,057      8,194      2,427 
Purchases of property and equipment          (25,088)   (25,117)  (120,426)
Additions to other long-term assets          (11,102)    (7,714)    (7,623)
                                           ---------  ---------  --------- 
   Net cash provided by (used in) 
     investing activities                  $ (30,640) $ (23,327) $(124,472)
                                           ---------  ---------  --------- 
</TABLE>








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

                                      F-7
<PAGE>
<TABLE>
                      AZTAR CORPORATION AND SUBSIDIARIES
               CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
  For the Years Ended December 31, 1998, January 1, 1998 and January 2, 1997
                                --------------
                                (in thousands)
<CAPTION>
                                                1998      1997      1996   
                                              --------- --------- ---------
<S>                                           <C>       <C>       <C>
Cash Flows from Financing Activities
Proceeds from issuance of long-term debt      $478,400  $237,700  $220,200 
Proceeds from issuance of common stock             402       697    58,051 
Principal payments on long-term debt          (517,178) (259,419) (177,421)
Principal payments on other long-term 
  liabilities                                   (1,527)   (1,777)   (5,126)
Debt issuance costs                             (2,246)     (195)     (478)
Preferred stock dividend                          (649)     (689)     (726)
Redemption of preferred stock                     (492)     (481)     (563)
                                              --------  --------  -------- 
   Net cash provided by (used in) 
     financing activities                      (43,290)  (24,164)   93,937 
                                              --------  --------  -------- 
Net increase (decrease) in cash and 
  cash equivalents                              12,471     1,998    17,604 

Cash and cash equivalents at beginning 
  of year                                       46,129    44,131    26,527 
                                              --------  --------  -------- 
     Cash and cash equivalents at end 
       of year                                $ 58,600  $ 46,129  $ 44,131 
                                              ========  ========  ======== 
Supplemental Cash Flow Disclosures

Summary of non-cash investing and 
  financing activities:
    Reduction in land and other long-term
      liabilities                             $     --  $  2,000  $     -- 
    Capital lease obligations incurred
      for property and equipment                 9,625       552        -- 
    Tax benefit from stock options 
      and preferred stock dividend                 140       247       916 
    Issuance of restricted stock                    --        --       136 
    Forfeiture of restricted stock                  --        24        75 

Cash flow during the year for the following:
    Interest paid, net of amount capitalized  $ 57,913  $ 60,041  $ 58,037 
    Income taxes paid (refunded)                 3,803    (3,233)    1,086 


</TABLE>







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

                                      F-8
<PAGE>

<TABLE>
                      AZTAR CORPORATION AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
  For the Years Ended December 31, 1998, January 1, 1998 and January 2, 1997 
                                --------------
                                (in thousands)
<CAPTION>
                                                          Unearned
                     Common  Paid-in  Retained  Treasury   Compen-
                      Stock  Capital  Earnings   Stock      sation    Total
                    -------- -------- --------- --------- --------- --------
<S>                 <C>      <C>      <C>       <C>       <C>       <C>
Balance,
 December 28, 1995  $    422 $352,221 $ 24,922  $(17,027) $   (879) $359,659
 Issuance of common
  stock in public
  offering                63   55,813                                 55,876
 Stock options
  exercised                4    2,171                                  2,175
 Issuance of 
  restricted stock                136                         (136)       --
 Tax benefit
  from stock
  options exercised               817                                    817
 Preferred stock
  dividend and losses
  on redemption, net 
  of income tax 
  benefit                                 (715)                         (715)
 Forfeiture of
  restricted stock                                   (75)       75        --
 Amortization of
  unearned
  compensation                                                 823       823
 Net income                             20,639                        20,639
                    -------  -------- --------  --------  --------  --------
Balance,
 January 2, 1997        489   411,158   44,846   (17,102)     (117)  439,274
 Stock options
  exercised               2       695                                    697
 Tax benefit
  from stock
  options exercised               176                                    176
 Preferred stock
  dividend and losses
  on redemption, net 
  of income tax 
  benefit                                 (634)                         (634)
 Forfeiture of
  restricted stock                                   (24)       24        --
 Amortization of
  unearned
  compensation                                                  83        83
 Net income                              4,442                         4,442
                    -------  -------- --------  --------  --------  --------
Balance,
 January 1, 1998    $   491  $412,029 $ 48,654  $(17,126) $    (10) $444,038
                    =======  ======== ========  ========  ========  ========
</TABLE>
[FN]
The accompanying notes are an integral part of these financial statements.

                                      F-9
<PAGE>

<TABLE>
                      AZTAR CORPORATION AND SUBSIDIARIES
          CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (continued)
  For the Years Ended December 31, 1998, January 1, 1998 and January 2, 1997 
                                 -------------
                                (in thousands)
<CAPTION>
                                                          Unearned
                     Common  Paid-in  Retained  Treasury   Compen-
                      Stock  Capital  Earnings   Stock      sation    Total
                     ------- -------- --------- --------- --------- --------
<S>                  <C>     <C>      <C>       <C>       <C>       <C>
Balance, 
  January 1, 1998    $   491 $412,029 $ 48,654  $(17,126) $    (10) $444,038
  Stock options
   exercised               1      401                                    402
  Tax benefit
   from stock
   options exercised               98                                     98
  Preferred stock
   dividend and losses
   on redemption, net 
   of income tax 
   benefit                                (609)                         (609)
  Amortization of
   unearned
   compensation                                                 10        10
  Net income                            10,162                        10,162
                     ------- -------- --------  --------  --------  --------
Balance,
  December 31, 1998  $   492 $412,528 $ 58,207  $(17,126) $     --  $454,101
                     ======= ======== ========  ========  ========  ========

</TABLE>






















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

                                     F-10
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1.  SIGNIFICANT ACCOUNTING POLICIES

Basis of Consolidated Statements

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

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

The consolidated financial statements include the accounts of Aztar and all
of its controlled subsidiaries and partnerships.  All subsidiary companies
are wholly owned.  In consolidating, all material intercompany transactions
are eliminated.  The Company uses a 52/53 week fiscal year ending on the
Thursday nearest December 31, which included 52 weeks in 1998 and 1997 and
53 weeks in 1996. 

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

Cash and Cash Equivalents

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

Short-term Investments

Short-term investments purchased with an original maturity of over three
months but less than one year are stated at cost, which approximates fair
value because of their short maturity.  There were no short-term
investments at December 31, 1998 or January 1, 1998. 

Inventories

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



                                    F-11
<PAGE>
Advertising Costs

Costs for advertising are expensed as incurred, except costs for direct-
response advertising, which are capitalized and amortized over the period
of the related program.  Direct-response advertising costs consist
primarily of mailing costs associated with direct-mail programs. 
Capitalized advertising costs, included in prepaid expenses, were
immaterial at December 31, 1998 and January 1, 1998.  Advertising costs
that were expensed during the year were $17,439,000 in 1998, $18,423,000 in
1997 and $19,699,000 in 1996. 

Other Investments

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

Property and Equipment

Property and equipment are stated at cost.  During construction, the
Company capitalizes interest and other direct and indirect development
costs.  Interest is capitalized monthly by applying the effective interest
rate on certain borrowings to the average balance of expenditures.  There
was no interest capitalized during 1998 or 1997.  The interest capitalized
during 1996 was $4,503,000.

Depreciation and amortization are computed by the straight-line method
based upon the following useful lives:  buildings and improvements, 3-40
years; riverboats, barge, docking facilities and improvements, 3-25 years;
furniture and equipment, 3-15 years; and leasehold improvements, shorter of
lease term or asset useful life.  Accumulated depreciation and amortization
on buildings, riverboats and equipment was $307,541,000 at December 31,
1998 and $262,654,000 at January 1, 1998. 
 
Improvements, renewals and extraordinary repairs that extend the life of
the asset are capitalized; other repairs and maintenance are expensed.  The
cost and accumulated depreciation applicable to assets retired are removed
from the accounts and the gain or loss, if any, on disposition is
recognized in income as realized.

Deferred Charges

Debt issuance costs are capitalized as incurred and amortized using the
interest method.  Capitalized debt issuance costs, net of accumulated
amortization of $4,916,000 and $7,301,000, were $9,690,000 and $11,447,000
at December 31, 1998 and January 1, 1998, respectively.

Costs incurred to obtain initial gaming licenses to operate a casino are
capitalized as incurred and amortized evenly over ten years beginning with
the commencement of operations; subsequent renewal costs are amortized
evenly over the renewal period.  Deferred licensing costs consist primarily
of payments or obligations to civic and community organizations, legal and
consulting fees, application and selection fees with associated
investigative costs and direct internal salaries and related costs of
development personnel.  Deferred licensing costs in connection with initial
gaming licenses, net of accumulated amortization of $8,868,000 and
$6,351,000, were $16,567,000 and $17,874,000 at December 31, 1998 and
January 1, 1998, respectively.

                                    F-12
<PAGE>
Preopening costs directly related to the opening of a gaming operation or
major addition to a gaming operation are capitalized as incurred and
expensed in the period the related facility commences operations. Effective
January 1, 1999, preopening costs are expensed as incurred.  Preopening
costs consist primarily of salaries and wages, marketing, temporary office
expenses, professional fees and training costs.  There were no capitalized
preopening costs at December 31, 1998 or January 1, 1998.

Development costs associated with pursuing opportunities in gaming
jurisdictions, as well as in jurisdictions in which gaming has not been
approved, are expensed as incurred until a particular opportunity is
determined to be viable, generally when the Company has been selected as
the operator of a new gaming facility, has applied for a gaming license or
has obtained rights to a specific site.  Development costs incurred
subsequent to these criteria being met are capitalized.  Development costs
consist of deferred licensing costs and site acquisition costs.  In
jurisdictions in which gaming has not been approved, only site acquisition
costs are capitalized.  In the event a project is later determined not to
be viable or the Company is not licensed to operate a facility at a site,
the capitalized costs related to this project or site would be expensed. 
At December 31, 1998 and January 1, 1998, the Company had capitalized
development costs of $2,630,000 and $954,000, respectively.  It is
reasonably possible that management's estimate of viability with regard to
a development project may change in the near term.

Valuation of Long-Lived Assets

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

The Company performed such a review at December 31, 1998, in connection
with its riverboat operation in Caruthersville, Missouri.  The Company had
approximately $42,932,000 in carrying value of long-lived assets and
certain identifiable intangibles associated with Casino Aztar
Caruthersville at December 31, 1998.  A number of factors were considered
in the evaluation of recoverability, including, but not limited to,
anticipated revenues and the duration thereof, expected operating costs,
the competitive environment and future legislative and regulatory changes. 
Although the results of the Company's analysis did not have an effect on
the carrying value for Casino Aztar Caruthersville at December 31, 1998, it
is reasonably possible that management's evaluation of recoverability could
change in the near term.

Equity Instruments

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

                                    F-13
<PAGE>
Revenue Recognition
<TABLE>
Casino revenue consists of gaming win net of losses.  Revenues exclude the
retail value of complimentary food and beverage, accommodations and other
goods and services provided to customers.  The estimated costs of providing
such complimentaries have been classified as casino expenses through
interdepartmental allocations as follows (in thousands):
<CAPTION>
                           1998      1997      1996  
                         --------  --------  --------
    <S>                  <C>       <C>       <C>
    Rooms                $ 22,172  $ 22,710  $ 23,615
    Food and beverage      49,599    47,755    42,765
    Other                   3,053     2,957     2,716
                         --------  --------  --------
                         $ 74,824  $ 73,422  $ 69,096
                         ========  ========  ========
</TABLE>
Income Taxes

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

Earnings per Share

Earnings per common share excludes dilution and is computed by dividing
income applicable to common shareholders by the weighted-average number of
common shares outstanding.  Earnings per common share, assuming dilution,
is computed based on the weighted-average number of common shares
outstanding after consideration of the dilutive effect of stock options and
the assumed conversion of the preferred stock at the stated rate. 

NOTE 2.  CONCENTRATIONS OF CREDIT RISK

Financial instruments that potentially subject the Company to 
concentrations of credit risk consist principally of cash and cash
equivalents, long-term investments and trade accounts receivable.  The
Company places its cash and temporary cash investments with high-credit-
quality financial institutions.  At times, such investments may be in
excess of the FDIC and SIPC insurance limits.  

The Atlantic City Tropicana has a concentration of credit risk in the
northeast region of the U.S.  Approximately 63% of the receivables at the
Nevada operations are concentrated in Asian and Latin American customers
and the remainder of their receivables are concentrated in California and
the southwest region of the U.S.  As a general policy, the Company does not
require collateral for these receivables.  At December 31, 1998 and January
1, 1998, the net receivables at Tropicana Atlantic City were $16,645,000
and $20,910,000, respectively, and the net receivables at Tropicana Las
Vegas and Ramada Express combined were $13,441,000 and $21,778,000, 
respectively.


                                    F-14
<PAGE>
An allowance for doubtful accounts is maintained at a level considered
adequate to provide for possible future losses.  At December 31, 1998 and
January 1, 1998, the allowance for doubtful accounts was $25,296,000 and
$17,919,000, respectively.

NOTE 3.  INVESTMENTS IN AND ADVANCES TO UNCONSOLIDATED PARTNERSHIP

The Company's investment in unconsolidated partnership is a noncontrolling
partnership interest of 50% in Tropicana Enterprises, a Nevada general
partnership that owns the real property and certain personal property that
the Company leases in the operation of the Las Vegas Tropicana.  The
Company uses the equity method of accounting for this investment and in
connection with the lease expensed rents of $16,540,000 in 1998,
$16,554,000 in 1997 and $16,652,000 in 1996, of which 50% was eliminated in
consolidation.  On February 2, 1998, the Company acquired an option to
purchase the 50% partnership interest that it does not own.  On February 1,
1999, the Company amended this option.  The amended option agreement gives
the Company an unconditional right, but not the obligation, to purchase the
partnership interest for $120,000,000 until as late as February 1, 2002.
<TABLE>
Summarized balance sheet information and operating results for the
unconsolidated partnership are as follows (in thousands):
<CAPTION>
                                  December 31,  January 1,
                                     1998          1998  
                                  -----------   ----------
     <S>                           <C>           <C>
     Income producing properties   $ 52,018      $ 54,741    
     Other assets                    10,891        11,971
     Bank term loan payable          60,228        63,304
     Other liabilities                  938           884

<CAPTION>
                                     1998          1997        1996  
                                  ----------    ----------   --------
     <S>                           <C>           <C>         <C>
     Revenues                      $ 16,568      $ 16,591    $ 16,698
     Operating expenses              (2,743)       (2,743)     (2,797)
                                   --------      --------    --------
     Operating income                13,825        13,848      13,901
     Interest expense                (4,833)       (5,397)     (5,693)
                                   --------      --------    --------
     Net income                    $  8,992      $  8,451    $  8,208
                                   ========      ========    ========
</TABLE>
<TABLE>
The Company's share of the above operating results, after intercompany
eliminations, is as follows (in thousands):
<CAPTION>
                                     1998          1997        1996  
                                   --------      --------    --------
     <S>                          <C>           <C>         <C>
     Equity in unconsolidated 
      partnership's loss           $ (4,336)     $ (4,618)   $ (4,793)

</TABLE>







                                    F-15
<PAGE>
NOTE 4.  OTHER INVESTMENTS
<TABLE>
Other investments consist of the following (in thousands):
<CAPTION>
                                               December 31,   January 1,
                                                  1998           1998   
                                                --------      ---------
           <S>                                 <C>            <C>
           CRDA deposits, net of a valuation 
             allowance of $6,452 and $6,706     $16,645        $17,986 
           CRDA bonds, net of an unamortized
             discount of $1,912 and $1,920        4,360          4,333 
                                                -------        ------- 
                                                $21,005        $22,319 
                                                =======        ======= 
</TABLE>
The Company deposits funds with the CRDA to satisfy a New Jersey assessment
based upon its casino revenues.  Deposits with the CRDA bear interest at
two-thirds of market rates resulting in a fair value lower than cost.  If
not used for other purposes, the CRDA deposits are used to invest in bonds
issued by the CRDA as they become available that also bear interest at two-
thirds of market rates.  The CRDA bonds have various contractual maturities
that range from 16 to 49 years.  Actual maturities may differ from
contractual maturities because of prepayment rights.

The Company has an agreement with the CRDA for approximately $24,000,000 in
funding in connection with a completed expansion project at the Atlantic
City Tropicana.  The Company receives funds from the CRDA based on
expenditures made for the project to the extent that the Company has
available funds on deposit with the CRDA that qualify for this funding.  As
of December 31, 1998, the Company has received approximately $15,300,000 in
funding from the CRDA under this agreement.  At December 31, 1998 and
January 1, 1998, the Company had approximately $800,000 and $900,000,
respectively, in available deposits with the CRDA that qualified and
accordingly reclassified these amounts to accounts receivable.  

NOTE 5.  LAS VEGAS TROPICANA REDEVELOPMENT

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

The net book value of the property and equipment used in the operation of
the Las Vegas Tropicana was $34,144,000 at December 31, 1998.  It is
reasonably possible that the carrying value of some or all of these assets
may change in the near term.











                                    F-16
<PAGE>
NOTE 6.  LONG-TERM DEBT
<TABLE>
Long-term debt consists of the following (in thousands):
<CAPTION>
                                                    December 31, January 1,
                                                       1998         1998  
                                                    -----------  ----------
<S>                                                   <C>         <C>
11% Senior Subordinated Notes Due 2002; redeemable
 at 101.571%                                          $200,000    $200,000
13 3/4% Senior Subordinated Notes Due 2004 ($180,000
 principal amount, 14% effective interest rate);
 redeemable beginning October 1, 1999 at 106.875%;
 net of unamortized discount                           178,243     178,061
Reducing revolving credit note; floating rate; 
 matures December 31, 1999                                  --     139,000
Reducing revolving credit note; floating rate,
 7.36% at December 31, 1998; matures June 30, 2003      53,100          --
Term loan; floating rate, 8.04% at December 31, 1998;
 matures June 30, 2005                                  50,000          --
Other notes payable; 7% to 14.6%; maturities to 2002       868       1,213
Obligations under capital leases                         7,869         824
                                                      --------    --------
                                                       490,080     519,098 
Less current portion                                    (2,537)    (27,166)
                                                      --------    --------
                                                      $487,543    $491,932
                                                      ========    ========
</TABLE>
Maturities of long-term debt for the five years subsequent to December 31,
1998 are as follows (in thousands):

          1999                         $  2,537
          2000                            3,577
          2001                            2,598
          2002                          201,424
          2003                           53,804

The 11% Senior Subordinated Notes ("11% Notes") are due on October 1, 2002. 
Interest on the 11% Notes is payable semiannually on April 1 and October 1. 
The 11% Notes are redeemable at the option of the Company, in whole or in
part, at 101.571% of the principal amount plus interest declining to 100%
of the principal amount plus interest beginning October 1, 1999. 

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

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



                                    F-17
<PAGE>
Notes limit the ability of the Company to incur indebtedness or engage in
mergers, consolidations or sales of assets.  

On May 28, 1998, the Company completed new financing consisting of a
$250,000,000 reducing revolving credit note maturing on June 30, 2003
("Revolver") and a $50,000,000 term loan maturing on June 30, 2005 ("Term
Loan").  The funds borrowed under the Revolver were used to prepay the
balance outstanding and extinguish the prior reducing revolving credit note
maturing on December 31, 1999 ("Original Credit Facility").  The funds
received under the Term Loan were used to repay a portion of the Revolver. 
The Company's $25,000,000 supplemental reducing revolving loan agreement
maturing on March 15, 1999 ("Supplemental Credit Facility"), was
extinguished concurrently with the Original Credit Facility.  There were no
borrowings outstanding under the Supplemental Credit Facility from its
inception through the date it was extinguished.

The maximum amount available under the Revolver will be reduced quarterly
by $10,000,000 commencing on September 30, 2000.  Interest is computed on
the outstanding principal balance of the Revolver based upon, at the
Company's option, a one-, two-, three- or six-month Eurodollar rate plus a
margin ranging from 1.00% to 2.25%, or the prime rate plus a margin ranging
from zero to 1.00%.  The applicable margin is dependent upon the Company's
outstanding indebtedness and operating cash flow.  As of December 31, 1998,
the margin was at 0.5% less than the highest level.  Interest computed
based upon the Eurodollar rate is payable quarterly or on the last day of
the applicable Eurodollar interest period, if earlier.  Interest computed
based upon the prime rate is payable quarterly.  The Company incurs a
commitment fee ranging from 0.225% to 0.4375% per annum on the unused
portion of the Revolver.

The Term Loan calls for quarterly principal payments of $125,000 beginning
on September 30, 1999 through June 30, 2004, and $11,875,000 beginning on
September 30, 2004 through maturity.  Interest is computed on the Term Loan
based upon, at the Company's option, a one-, two-, three- or six-month
Eurodollar rate plus a margin of 2.5%.  Interest is payable quarterly or on
the last day of the applicable Eurodollar interest period, if earlier.

The collateral securing the Revolver and the Term Loan, shared on a pari
passu basis, consists of all the property of Tropicana Atlantic City,
Ramada Express and the casino riverboat operations and, with certain
exceptions, the stock of the Company's subsidiaries.  The Revolver imposes
various restrictions on the Company, including limitations on its ability
to incur additional debt, commit funds to capital expenditures and
investments, merge or sell assets.  The Revolver also prohibits dividends
on the Company's common stock, other than those payable in common stock,
and repurchases of the Company's common stock in excess of $30,000,000 with
certain limited exceptions.  In addition, the Revolver has certain
quarterly financial tests, including a minimum requirement for operating
cash flow, a minimum ratio of debt service coverage and maximum ratios of
total debt and senior debt to operating cash flow.  The restrictions
imposed on the Company by the Term Loan are similar to those imposed by the
Company's subordinated debt.

NOTE 7.  LEASE OBLIGATIONS

The Company is a lessee under a number of noncancelable lease agreements
involving land, buildings, leasehold improvements and equipment, some of 

                                    F-18
<PAGE>
which provide for contingent rentals based on revenues, the consumer price
index and/or interest rate fluctuations.  The leases extend for various 
periods up to 12 years and generally provide for the payment of executory
costs (taxes, insurance and maintenance) by the Company.  Certain of these
leases have provisions for renewal options ranging from 1 to 15 years,
primarily under similar terms, and/or options to purchase at various dates.
<TABLE>
Properties leased under capital leases are as follows (in thousands):
<CAPTION>
                                                    December 31, January 1,
                                                        1998        1998  
                                                    -----------  ----------
          <S>                                        <C>          <C>
          Furniture and equipment                    $ 18,714     $  9,945
          Less accumulated amortization               (10,932)      (9,273)
                                                     --------     --------
                                                     $  7,782     $    672
                                                     ========     ========
</TABLE>
Amortization of furniture and equipment leased under capital leases,
computed on a straight-line basis, was $2,357,000 in 1998, $269,000 in 1997
and $146,000 in 1996. 
<TABLE>
Minimum future lease obligations on long-term, noncancelable leases in
effect at December 31, 1998 are as follows (in thousands):
<CAPTION>
         Year                                         Capital     Operating
         ----                                        --------     ---------
         <S>                                         <C>          <C>
         1999                                        $  2,771     $ 11,879
         2000                                           3,294       10,132
         2001                                           1,906        9,034
         2002                                             781        8,441
         2003                                             231        8,250
         Thereafter                                       159       52,651
                                                     --------     -------- 

                                                        9,142     $100,387
                                                                  ========
         Amount representing interest                  (1,273)
                                                     --------
         Net present value                              7,869
         Less current portion                          (2,138)
                                                     --------
         Long-term portion                           $  5,731
                                                     ========
</TABLE>
The above net present value is computed based on specific interest rates
determined at the inception of the leases.  
<TABLE>
Rent expense is detailed as follows (in thousands):
<CAPTION>
                                               1998      1997      1996  
                                             --------  --------  --------
         <S>                                 <C>       <C>       <C>
         Minimum rentals                     $ 15,968  $ 18,099  $ 12,379
         Contingent rentals                     3,405     3,280     3,319
                                             --------  --------  --------
                                             $ 19,373  $ 21,379  $ 15,698
                                             ========  ========  ========

</TABLE>

                                    F-19
<PAGE>
NOTE 8.  OTHER LONG-TERM LIABILITIES
<TABLE>
Other long-term liabilities consist of the following (in thousands):
<CAPTION>
                                            December 31, January 1,
                                               1998         1998  
                                            -----------  ----------
         <S>                                 <C>          <C>
         Deferred compensation and
           retirement plans                  $ 11,871     $ 10,776
         Accrued rent expense                  10,427       11,327
         Obligation to City of Evansville
           and other civic and community
           organizations                        3,050        4,550
         Las Vegas Boulevard
           beautification assessment              455          482
                                             --------     --------
                                               25,803       27,135
         Less current portion                  (2,921)      (2,931)
                                             --------     --------
                                             $ 22,882     $ 24,204
                                             ========     ========
</TABLE>
NOTE 9.  REDEEMABLE PREFERRED STOCK

A series of preferred stock consisting of 100,000 shares has been
designated Series B ESOP Convertible Preferred Stock ("ESOP Stock") and
those shares were issued on December 20, 1989, to the Company's Employee
Stock Ownership Plan ("ESOP").  The ESOP purchased the shares for
$10,000,000 with funds borrowed from a subsidiary of the Company.  These 
funds are repayable in even semiannual payments of principal and interest
at 13 1/2% per year over a 10-year term.  During 1998, 1997 and 1996,
respectively, 4,737 shares, 4,555 shares and 4,644 shares were redeemed
primarily in connection with employee terminations. At December 31, 1998,
cumulative redemptions totaled 21,259 shares.  The ESOP Stock has an annual
dividend rate of $8.00 per share per annum payable semiannually in arrears. 
These shares have no voting rights except under certain limited, specified
conditions.  Shares not allocated to participant accounts and those shares
not vested may be redeemed at $100 per share.  Shares may be converted into
common stock at $9.46 per share of common stock and have a liquidation
preference of $100 per share. 

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

NOTE 10.  CAPITAL STOCK

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

                                    F-20
<PAGE>
The Company is authorized to issue 100,000,000 shares of common stock with
a par value of $.01 per share.  Shares issued were 49,244,268 at December
31, 1998, and 49,120,863 at January 1, 1998.  Common stock outstanding was
net of 3,906,434 and 3,921,974 treasury shares at December 31, 1998 and
January 1, 1998, respectively.  One preferred stock purchase right
("Right") is attached to each share of the Company's common stock.  Each
Right will entitle the holder, subject to the occurrence of certain events,
to purchase a unit with no par value ("Unit") consisting of one one-
thousandth of a share of Series A Junior Participating Preferred Stock at a
purchase price of $40.00 per Unit subject to adjustment.  The Rights will
expire in December 1999 if not earlier redeemed by the Company at $.01 per
Right.

In 1996, the Company issued 6,279,200 shares of common stock in a public
offering.  The Company issued shares of restricted common stock in 1995 to
certain executive officers and key employees; however, 3,668 and 11,334 of
these shares were forfeited in 1997 and 1996, respectively.  The
restrictions on 122,998 of the unforfeited shares lapsed over a three-year
period commencing on the date of issuance.  The restrictions on 34,000 of
the unforfeited shares lapsed during 1996 after the common stock price hit
a certain performance target.  Compensation expense in connection with this
issuance of restricted common stock was $10,000, $83,000 and $823,000 in
1998, 1997 and 1996, respectively.

In accordance with the Merger agreement, 666,572 shares of common stock
that had not been claimed by the shareholders of Ramada were returned to
the Company in December 1990 to be held as treasury shares until claimed. 
During 1998, 1997 and 1996, respectively, 15,540, 24,255 and 25,606 shares
were claimed; the balance of unclaimed shares was 328,047 as of December
31, 1998.

During 1990, the Board of Directors authorized the Company to make
discretionary repurchases of up to 4,000,000 shares of its common stock
from time to time in the open market or otherwise and at December 31, 1998,
there remained 591,900 shares that could be repurchased under this
authority.  No shares were repurchased under this program in 1998, 1997 or 
1996.  Repurchased and forfeited shares are stated at cost and held as
treasury shares to be used for general corporate purposes.

At December 31, 1998, January 1, 1998 and January 2, 1997, common shares
reserved for future grants of stock options under the Company's stock
option plans were 122,000, 589,000 and 1,036,000, respectively.  At
December 31, 1998, common shares reserved for the conversion of the ESOP
Stock were 833,000 and shares of preferred stock reserved for exercise of
the Rights were 50,000.

NOTE 11.  STOCK OPTIONS

The Company has elected to follow Accounting Principles Board Opinion No.
25 entitled "Accounting for Stock Issued to Employees" ("APB 25") and
related Interpretations in accounting for its stock-based employee
compensation arrangements because the alternative fair-value-based method
of accounting provided for under Financial Accounting Standards Board
Statement of Financial Accounting Standards No. 123 entitled "Accounting
for Stock-Based Compensation" ("SFAS 123") requires use of option valuation
models that were not developed for use in valuing employee stock options. 


                                    F-21
<PAGE>
Under APB 25, because the exercise price of the Company's stock options
equals the market price of the underlying stock on the date of grant, no
compensation expense is recognized.

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

Pro forma information regarding net income and earnings per share is
required by SFAS 123, and has been determined as if the Company had
accounted for its stock option plans under the fair-value-based method of
that Statement.  The fair value for these options was estimated at the date
of grant or modification using a Black-Scholes option pricing model with
the following weighted-average assumptions: risk-free interest rate of 5.1%
in 1998, 6.5% in 1997 and 6.4% in 1996, no dividend in 1998, 1997 or 1996,
volatility factor of the expected market price of the Company's common
stock of .51 in 1998, .29 in 1997 and .42 in 1996, and an expected life of
the option of 4.7 years in 1998, 5.2 years in 1997 and 5.3 years in 1996.

The Black-Scholes option valuation model was developed for use in
estimating the fair value of traded options which have no vesting or
trading restrictions and are fully transferable.  In addition, option
valuation models require the input of highly subjective assumptions
including the expected stock price volatility.  Because the Company's
employee stock options have characteristics significantly different from
those of traded options, and because changes in the subjective input
assumptions can materially affect the fair value estimate, in management's
opinion, the existing models do not necessarily provide a reliable single
measure of the fair value of its stock options.
<TABLE>
For purposes of pro forma disclosures, the estimated fair value of the
options is amortized to expense over the options' vesting period.  The pro
forma information for 1998, 1997 and 1996 follows (in thousands except for
earnings per share information):
<CAPTION>
                                               1998      1997      1996    
                                             --------  --------  --------
  <S>                                        <C>       <C>       <C>
  Pro forma net income                       $  8,342  $  3,693  $ 20,122

  Pro forma earnings per share:
    Net income per common share              $    .17  $    .07  $    .47
    Net income per common share 
      assuming dilution                      $    .17  $    .07  $    .45

</TABLE>




                                    F-22
<PAGE>
During 1998, options to purchase 170,220 shares of the Company's common
stock at an exercise price of $6.16 that were to expire in 1998 were
extended to 2000.  In addition, options to purchase 555,000 shares of the
Company's common stock at an exercise price of $5.00 that were to expire in
2001 were extended to 2006.  In connection with the extension of these
option periods, the Company recorded approximately $483,000 of compensation
expense.
<TABLE>
A summary of the Company's other stock option activity and related
information for the years ended December 31, 1998, January 1, 1998 and
January 2, 1997 follows (in thousands of shares):
<CAPTION>
                      1998               1997               1996
                -----------------  -----------------  -----------------
                        Weighted-          Weighted-          Weighted-
                Shares  Average    Shares  Average    Shares  Average
                Under   Exercise   Under   Exercise   Under   Exercise
                Option  Price      Option  Price      Option  Price
                ------  ---------  ------  ---------  ------  ---------
<S>              <C>      <C>       <C>      <C>       <C>      <C>
Beginning balance 
 outstanding     3,503    $5.29     3,230    $5.00     3,687    $4.96
  Granted          527    $7.38       514    $7.00        88    $9.44
  Exercised       (124)   $3.26      (178)   $3.92      (441)   $4.93
  Forfeited        (60)   $8.75       (63)   $8.19       (58)   $7.37
  Expired           --    $  --        --    $  --       (46)   $8.15
                ------             ------             ------
Ending balance 
 outstanding     3,846    $5.59     3,503    $5.29     3,230    $5.00
                ======             ======             ======
Exercisable at 
 end of year     3,012    $5.12     2,774    $4.77     2,703    $4.47
                ======             ======             ======
Weighted-average 
 fair value
 of options
 granted during 
 the year       $ 3.81             $ 2.39             $ 4.17

</TABLE>



















                                    F-23
<PAGE>
<TABLE>
The following table summarizes additional information about the Company's
stock options outstanding at December 31, 1998, January 1, 1998 and January
2, 1997 (in thousands of shares):
<CAPTION>
                       Options Outstanding        Options Exercisable
                 ------------------------------   -------------------
                          Weighted- 
                           Average    Weighted-             Weighted-
                 Shares   Remaining   Average     Shares    Average
  Range of       Under   Contractual  Exercise    Under     Exercise
Exercise Prices  Option     Life       Price      Option      Price  
---------------  ------  -----------  ---------   ------    ---------
<S>               <C>     <C>           <C>       <C>         <C>
1998
----
$3.19             1,202   1.0 year      $3.19      1,202      $3.19
$4.06 to $5.06      650   7.7 years     $4.94        610      $5.00
$5.50 to $7.75    1,843   7.1 years     $7.06      1,062      $6.80
$9.13 to $11.00     151   6.8 years     $9.48        138      $9.43
                 ------                           ------
                  3,846   5.3 years     $5.59      3,012      $5.12
                 ======                           ======
1997
----
$3.19 to $5.00    1,922   2.6 years     $3.76      1,922      $3.76
$5.50 to $7.75    1,390   7.1 years     $6.83        739      $6.68
$9.13 to $11.00     191   7.9 years     $9.51        113      $9.46
                 ------                           ------
                  3,503   4.7 years     $5.29      2,774      $4.77
                 ======                           ======
1996
----
$3.19 to $5.00    2,082   3.6 years     $3.75      2,082      $3.75
$5.50 to $7.63      917   6.7 years     $6.73        554      $6.57
$8.50 to $11.00     231   8.8 years     $9.39         67      $9.36
                 ------                           ------
                  3,230   4.8 years     $5.00      2,703      $4.47
                 ======                           ======
</TABLE>
NOTE 12.  BENEFIT PLANS
<TABLE>
The Company has nonqualified defined benefit pension plans and a deferred
compensation plan.  These plans are unfunded.  The following table shows a
reconciliation of the changes in the plans' benefit obligation for the
years 1998 and 1997 and a statement of the funded status as of December 31,
1998 and January 1, 1998 (in thousands):













                                    F-24
<PAGE>

<CAPTION>
                         Defined Benefit Plans   Deferred Compensation Plan
                         ----------------------  --------------------------
                           1998         1997           1998         1997
                         --------     --------       --------     --------
<S>                      <C>          <C>            <C>          <C>
Projected benefit 
 obligation at 
 beginning of year       $  6,096     $  6,050       $  4,649     $  4,457
Service cost                   --           --             15           17
Interest cost                 509          504            387          370
Actuarial gain               (130)        (187)           (48)         (16)
Benefits paid                (271)        (271)          (184)        (179)
                         --------     --------       --------     --------
Projected benefit 
 obligation at end 
 of year                    6,204        6,096          4,819        4,649
                         --------     --------       --------     --------
Plan assets                    --           --             --           --
                         --------     --------       --------     --------
Funded status              (6,204)      (6,096)        (4,819)      (4,649)
Unrecognized actuarial 
 gain                        (533)        (384)          (622)        (588)
Unrecognized prior 
 service cost                 790          941             --           --
                         --------     --------       --------     --------
Net amount recognized    $ (5,947)    $ (5,539)      $ (5,441)    $ (5,237)
                         ========     ========       ========     ========
</TABLE>
<TABLE>
The following table shows the amounts recognized in the consolidated
balance sheets (in thousands):
<CAPTION>
                         Defined Benefit Plans   Deferred Compensation Plan
                         ----------------------  --------------------------
                         December 31, January 1,   December 31, January 1,
                            1998         1998         1998         1998
                         ------------ ----------   ------------ ----------
<S>                      <C>          <C>          <C>          <C>
Accrued benefit 
 liability               $ (5,947)    $ (5,539)    $ (5,441)    $ (5,237)
</TABLE>
<TABLE>
The components of benefit plan expense are as follows (in thousands):
<CAPTION>
                         Defined Benefit Plans   Deferred Compensation Plan
                         ----------------------  --------------------------
                          1998    1997    1996      1998    1997    1996
                         ------  ------  ------    ------  ------  ------
<S>                      <C>     <C>     <C>       <C>     <C>     <C>
Service cost             $   --  $   --  $   --    $   16  $   17  $   19
Interest cost               509     504     495       387     370     357
Amortization of prior
 service cost               150     166     198        --      --      --
Recognized net actuarial
 (gain) loss                 19      19    (108)      (15)    (16)    (19)
Cash surrender value 
 increase net of premium
 expense                     --      --      --      (219)   (201)   (180)
                         ------  ------  ------    ------  ------  ------
                         $  678  $  689  $  585    $  169  $  170  $  177
                         ======  ======  ======    ======  ======  ======
</TABLE>
                                    F-25
<PAGE>
<TABLE>
The assumptions used in the measurement of the Company's benefit obligation
are as follows:
<CAPTION>
                         Defined Benefit Plans   Deferred Compensation Plan
                         ----------------------  --------------------------
                          1998    1997    1996      1998    1997    1996
                         ------  ------  ------    ------  ------  ------
<S>                       <C>     <C>     <C>       <C>     <C>     <C>
Discount rate             8.5%    8.5%    8.5%      8.5%    8.5%    8.5%
Rate of compensation
 increase                 5.0%    5.0%    5.0%      N/A     N/A     N/A
</TABLE>
The Company has a defined contribution savings plan that covers
substantially all employees who are not covered by a collective bargaining
unit.  The savings account feature of the plan allows employees, at their
discretion, to make contributions of their before-tax earnings to the plan
up to an annual maximum amount.  Effective July 1, 1997, the Company
matches 50% of the employee contributions that are based on up to 4% of an
employee's before-tax earnings.  Compensation expense with regard to
Company matching contributions was $1,578,000 and $771,000 in 1998 and
1997, respectively.  Additional Company contributions to the savings plan
are discretionary and there were none in 1998, 1997 or 1996.  The Company
contributed $2,840,000, $2,711,000 and $2,563,000 in 1998, 1997 and 1996,
respectively, to trusteed pension plans under various collective bargaining
agreements.

The Company's ESOP covers substantially all nonunion employees.  The
Company makes contributions to the ESOP so that, after the dividends are
paid on the Company's ESOP Stock, the ESOP can make its debt service
payments to the Company.  Cash dividends and contributions, respectively,
paid to the ESOP were $649,000 and $1,226,000 in 1998, $689,000 and
$1,186,000 in 1997 and $726,000 and $1,149,000 in 1996.  Compensation
expense recognized in 1998, 1997 and 1996, respectively, was $718,000,
$862,000 and $993,000.

NOTE 13.  INCOME TAXES 
<TABLE>
The (provision) benefit for income taxes is comprised of (in thousands):
<CAPTION>
                                              1998       1997      1996  
                                            --------   --------  --------

 <S>                                        <C>        <C>       <C>
 Current:
   Federal                                  $ (6,057)  $  1,331  $   (860)
   State                                        (899)       670     1,108
                                            --------   --------  --------
                                              (6,956)     2,001       248
 Deferred:                                  --------   --------  --------
   Federal                                    (1,188)     2,151    28,700
   State                                        (224)    (1,967)   (6,249)
                                            --------   --------  --------
                                              (1,412)       184    22,451
                                            --------   --------  --------
                                            $ (8,368)  $  2,185  $ 22,699
                                            ========   ========  ========
</TABLE>
The Company is responsible, with certain exceptions, for the taxes of
Ramada through December 20, 1989.  The Internal Revenue Service ("IRS") has
completed its examinations of the income tax returns for the years 1988
through 1991 and has settled for all but one issue.  The effect on the
Company of settling prior years was an income tax benefit of $2,323,000 in
1997, primarily related to cash received as a result of the settlement, and
$21,028,000 in 1996 that included a reduction in the beginning-of-year 
                                    F-26
<PAGE>
valuation allowance.  The IRS is examining the income tax returns for the
years 1992 through 1996.  Management believes that adequate provision for
income taxes and interest has been made in the financial statements.
<TABLE>
General business credits are taken as a reduction of the provision for
income taxes during the year such credits become available.  The
(provision) benefit for income taxes differs from the amount computed by
applying the U.S. federal income tax rate (35%) because of the effect of
the following items (in thousands):
<CAPTION>
                                              1998       1997      1996  
                                            --------   --------  --------
<S>                                         <C>        <C>       <C>
Tax (provision) benefit at U.S. federal 
  income tax rate                           $(6,957)   $  (790)  $   721
    State income taxes, net                    (726)      (788)       29
    Nondeductible business expenses          (1,586)      (727)     (640)
    IRS examination                             158      1,498     1,158
    General business credits                    356        286       237
    Change in valuation allowance                --         --     3,641
    Ramada tax sharing agreement                 --      2,323    17,387
    Other, net                                  387        383       166 
                                            -------    -------   -------
                                            $(8,368)   $ 2,185   $22,699
                                            =======    =======   =======
</TABLE>
<TABLE>
The income tax effects of loss carryforwards, tax credit carryforwards and
temporary differences between financial and income tax reporting that give
rise to the deferred income tax assets and liabilities are as follows (in
thousands):
<CAPTION>
                                            December 31,       January 1,
                                                1998              1998   
                                            ------------       ----------
<S>                                           <C>               <C>
Net operating loss carryforward               $ 16,440          $ 21,739 
Accrued rent expense                             6,007             5,795 
Accrued bad debt expense                        13,002             9,228 
Accrued compensation                             6,420             5,695 
Accrued liabilities                              9,712             7,966 
General business credit carryforward            14,350             8,161 
                                              --------          -------- 
Gross deferred tax assets                       65,931            58,584 
                                              --------          -------- 
Deferred tax asset valuation allowance          (3,343)           (4,881)
                                              --------          -------- 
Other                                          (12,881)           (5,675)
Partnership investment                          (5,075)           (5,153)
Depreciation and amortization                  (34,310)          (31,141)
                                              --------          -------- 
Gross deferred tax (liabilities)               (52,266)          (41,969)
                                              --------          -------- 
Net deferred tax assets (liabilities)         $ 10,322          $ 11,734 
                                              ========          ======== 
</TABLE>
Gross deferred tax assets are reduced by a valuation allowance. Realization
of the net deferred tax asset at December 31, 1998, is dependent on
generating sufficient taxable income prior to expiration of the net
operating loss carryforward.  Although realization is not assured,
management believes it is more likely than not that all of the net deferred
tax asset will be realized.  The amount of the deferred tax asset 

                                    F-27
<PAGE>
considered realizable, however, could change in the near future if
estimates of future taxable income during the carryforward period are
changed.  The beginning-of-year valuation allowance was reduced during 1998
and 1996, which caused a decrease in income tax expense of $1,715,000 and
$3,641,000, respectively.  The beginning-of-year valuation allowance was
increased during 1997, which caused an increase in income tax expense of
$876,000.  

At December 31, 1998, tax benefits are available for federal income tax
purposes as follows (in thousands):

Net operating losses                                   $35,791
General business credits                                 4,742

These tax benefits will expire in the years 2003 through 2018 if not used. 
The Company also has alternative minimum tax credit carryforwards of 
$9,608,000 that can be carried forward indefinitely and offset against the
regular federal income tax liability.  In addition, the Company has net
operating loss carryforwards for state income tax purposes that will expire
in the following years if not used (in thousands):

                    1999                 $ 3,258
                    2000                   5,729
                    2001                   9,684
                    2002                     480
                    2003 to 2018          60,340

NOTE 14.  EXTRAORDINARY ITEMS

During 1998, the Company expensed the remaining unamortized deferred
financing costs in connection with the extinguishment of the Original
Credit Facility and the Supplemental Credit Facility.  These items were
reflected in the 1998 Consolidated Statement of Operations as an
extraordinary loss of $1,346,000, which was net of an income tax benefit of
$725,000.

NOTE 15.  EARNINGS PER SHARE
<TABLE>
The computations of earnings per common share and earnings per common
share, assuming dilution, are as follows:
<CAPTION>
                                              1998       1997      1996  
                                            --------   --------  --------
<S>                                         <C>        <C>       <C>
Income before extraordinary items           $ 11,508   $  4,442  $ 20,639

Less: preferred stock dividends and
  losses on redemption (net of income
  tax benefits of $42, $71 and $99,
  credited to retained earnings)                (609)      (634)     (715)
                                            --------   --------  --------
Income before extraordinary items
  applicable to computations                  10,899      3,808    19,924

Extraordinary items                           (1,346)        --        --
                                            --------   --------  --------
Net income applicable to computations       $  9,553   $  3,808  $ 19,924
                                            ========   ========  ========

                                    F-28
<PAGE>
Weighted-average common shares
  applicable to earnings per common 
  share                                       45,230     45,121    41,121

Effect of dilutive securities:
  Stock option incremental shares                525        657     1,051
  Assumed conversion of preferred stock          859        909       960
                                            --------   --------  --------
                                               1,384      1,566     2,011
Weighted-average common shares              --------   --------  --------
  applicable to earnings per common 
  share assuming dilution                     46,614     46,687    43,132
                                            ========   ========  ========

Earnings per common share:
  Income before extraordinary items         $    .24   $    .08  $    .48
  Extraordinary items                           (.03)        --        --
                                            --------   --------  --------
  Net income                                $    .21   $    .08  $    .48
                                            ========   ========  ========

Earnings per common share assuming dilution:
  Income before extraordinary items         $    .23   $    .08  $    .46
  Extraordinary items                           (.03)        --        --
                                            --------   --------  --------
  Net income                                $    .20   $    .08  $    .46
                                            ========   ========  ========
</TABLE>
NOTE 16.  CONTINGENCIES AND COMMITMENTS

The Company agreed to indemnify Ramada against all monetary judgments in
lawsuits pending against Ramada and its subsidiaries as of the conclusion
of the Restructuring on December 20, 1989, as well as all related
attorneys' fees and expenses not paid at that time, except for any
judgments, fees or expenses accrued on the hotel business balance sheet and
except for any unaccrued and unreserved aggregate amount up to $5,000,000
of judgments, fees or expenses related exclusively to the hotel business. 
Aztar is entitled to the benefit of any crossclaims or counterclaims
related to such lawsuits and of any insurance proceeds received.  In
addition, the Company agreed to indemnify Ramada for various lease
guarantees made by Ramada relating to the restaurant business.  In
connection with these matters, the Company has an accrued liability of
$3,894,000 and $3,905,000 at December 31, 1998 and January 1, 1998,
respectively.

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

The Tropicana Las Vegas lease agreement contains a provision that requires
the Company to maintain an additional security deposit with the lessor of
$21,000,000 in cash or a letter of credit if the Tropicana Las Vegas
operation fails to meet certain financial tests.  A determination was made
for the period ended December 31, 1998, that the additional security 

                                    F-29
<PAGE>
deposit would be required by May 15, 1999; however, the lessor has waived
the requirement.  The Company has a 50% partnership interest in the lessor.

The Company has severance agreements with certain of its senior executives. 
Severance benefits range from a lump-sum cash payment equal to three times
the sum of the executive's annual base salary and the average of the
executive's annual bonuses awarded in the preceding three years plus
payment of the value in the executive's outstanding stock options and
vesting and distribution of any restricted stock to a lump-sum cash payment
equal to the executive's annual base salary.  In certain agreements, the
termination must be as a result of a change in control of the Company. 
Based upon current salary levels and stock options, the aggregate
commitment under the severance agreements should all these executives be
terminated was approximately $11,000,000 at December 31, 1998.

NOTE 17.  FAIR VALUE OF FINANCIAL INSTRUMENTS
<TABLE>
The following table presents (in thousands) the carrying amounts and
estimated fair values of the Company's financial instruments.  The fair
value of a financial instrument is the amount at which the instrument could
be exchanged in a current transaction between willing parties, other than
in a forced or liquidation sale.
<CAPTION>
                                December 31, 1998      January 1, 1998  
                               -------------------   -------------------
                               Carrying     Fair     Carrying     Fair  
                                Amount     Value      Amount     Value  
                               --------   --------   --------   --------
<S>                           <C>        <C>        <C>        <C>
Assets
  Other investments           $ 21,005   $ 21,005   $ 22,319   $ 22,319 

Liabilities
  Current portion of long-term
    debt                         2,537      2,537     27,166     27,166 
  Current portion of other 
    long-term liabilities        1,550      1,482      1,550      1,482 
  Long-term debt               487,543    512,200    491,932    526,871 
  Other long-term liabilities    1,500      1,321      3,000      2,542 

Series B ESOP convertible 
  preferred stock                7,147      7,147      6,593      6,857 

Off-Balance-Sheet
  Letters of credit                 --      5,774         --      8,368 
</TABLE>
The carrying amounts shown in the table are included, if applicable, in the
Consolidated Balance Sheets under the indicated captions.  All of the
Company's financial instruments are held or issued for purposes other than
trading.

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

Other investments consisted of deposits with the CRDA and CRDA bonds that
bear interest at two-thirds of market rates resulting in a fair value lower
than cost.  The carrying amounts of these deposits and bonds are presented
net of a valuation allowance and an unamortized discount that result in an
approximation of fair values.

                                    F-30
<PAGE>
The fair values of the Company's publicly traded debt were estimated based
on the bid prices in the public bond markets.  The carrying amounts of the
Revolver and the Term Loan are reasonable estimates of fair values because
this debt is carried with a floating interest rate.

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

The fair value reported for the Series B ESOP convertible preferred stock
represents the latest appraised fair value as determined by an independent
appraisal.

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

NOTE 18.  LONG-TERM DEBT REFINANCING

The Company's 11% Notes are callable at a premium and become callable at
par on October 1, 1999.  The Company's 13 3/4% Notes become callable at a
premium on October 1, 1999.  If credit is available at favorable rates, the
Company may pursue a refinancing of its senior subordinated debt during
1999.  If the Company were successful in refinancing this debt, the
unamortized deferred financing charges and unamortized discount associated
with the existing senior subordinated debt would be written off as an
extraordinary charge.  At December 31, 1998, these unamortized items
totaled $9,500,000.  Any premium paid to retire this debt would also be an
extraordinary charge.



























                                    F-31
<PAGE>
NOTE 19.  UNAUDITED QUARTERLY RESULTS/COMMON STOCK PRICES
<TABLE>
The following unaudited information shows selected items in thousands, except
per share data, for each quarter in the years ended December 31, 1998 and
January 1, 1998.  The Company's common stock is listed on the New York Stock
Exchange.
<CAPTION>
                                   First    Second    Third     Fourth 
                                 --------  --------  --------  --------
<S>                              <C>       <C>       <C>       <C>
1998
----
Revenues                         $196,825  $203,168  $210,089  $196,054
Operating income                   16,866    21,582    25,431    17,767
Income before income taxes
  and extraordinary items           1,021     6,146    10,099     2,610
Income taxes                         (403)   (2,427)   (4,472)   (1,066)
Extraordinary items                    --    (1,346)       --        --
Net income                            618     2,373     5,627     1,544
Earnings per common share:
  Income before extraordinary
   items                              .01       .08       .12       .03
  Net income                          .01       .05       .12       .03
Earnings per common share 
  assuming dilution:
  Income before extraordinary 
   items                              .01       .08       .12       .03
  Net income                          .01       .05       .12       .03

1997
----
Revenues                         $189,756  $200,387  $201,874  $190,340
Operating income                   17,054    21,750    21,311     7,277 
Income (loss) before income 
  taxes                               597     5,355     5,040    (8,735)
Income taxes                        2,080    (1,926)   (1,797)    3,828 
Net income (loss)                   2,677     3,429     3,243    (4,907)
Earnings per share:
  Net income (loss) per common 
   share                              .06       .07       .07      (.11)
  Net income (loss) per common 
   share assuming dilution            .05       .07       .07      (.11)

Common Stock Prices
-------------------
1998 - High                        $ 9.94    $ 8.56    $ 6.88    $ 5.88
     - Low                           6.19      6.13      3.69      2.88
1997 - High                          8.50      7.75      7.88      8.00
     - Low                           6.63      6.13      6.50      5.88
</TABLE>









                                    F-32
<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

To the Partners
Tropicana Enterprises

In our opinion, the accompanying balance sheets and the related statements of
operations, cash flows and partners' capital  present fairly, in all material
respects, the financial position of Tropicana Enterprises (a Nevada General
Partnership)(the "Partnership") at December 31, 1998 and January 1, 1998, and
the results of its operations and its cash flows for each of the three years
in the period ended December 31, 1998, in conformity with generally accepted
accounting principles.  These financial statements are the responsibility of
the Partnership's management; our responsibility is to express an opinion on
these financial statements based on our audits.  We conducted our audits of
these statements in accordance with generally accepted auditing standards
which 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, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation.  We believe that
our audits provide a reasonable basis for the opinion expressed above.










PRICEWATERHOUSECOOPERS LLP




Phoenix, Arizona
February 3, 1999

















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

                               BALANCE SHEETS
                    -------------------------------------
                               (in thousands)
<CAPTION>
                                                 December 31,   January 1,
                                                     1998         1998    
                                                 ------------  -----------
<S>                                                <C>          <C>
Assets

  Income producing properties                      $  52,018    $  54,741 
  Cash                                                     1            1 
  Other receivable                                       904          943 
  Other assets                                         9,986       11,027 
                                                   ---------    --------- 
                                                   $  62,909    $  66,712 
                                                   =========    ========= 

Liabilities and Partners' Capital

  Term loan payable                                $  60,228    $  63,304 
  Unearned rental income                                 938          884 
                                                   ---------    --------- 
                                                      61,166       64,188 
  Partners' capital                                    1,743        2,524 
                                                   ---------    --------- 
                                                   $  62,909    $  66,712 
                                                   =========    ========= 
</TABLE>





















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


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

                          STATEMENTS OF OPERATIONS

 For the years ended December 31, 1998, January 1, 1998 and January 2, 1997
                     -----------------------------------
                               (in thousands)

<CAPTION>
                                           1998        1997        1996   
                                        ----------  ----------  ----------
<S>                                     <C>         <C>         <C>
Revenues:
  Rent                                  $  16,540   $  16,554   $  16,652 
  Interest                                     28          37          46 
                                        ---------   ---------   --------- 
                                           16,568      16,591      16,698 
                                        ---------   ---------   --------- 

Costs and expenses:
  General and administrative                    8           8           9 
  Interest                                  4,833       5,397       5,693 
  Depreciation and amortization             2,735       2,735       2,788 
                                        ---------   ---------   --------- 
                                            7,576       8,140       8,490 
                                        ---------   ---------   --------- 
Net income                              $   8,992   $   8,451   $   8,208 
                                        =========   =========   ========= 
</TABLE>
























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


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

                          STATEMENTS OF CASH FLOWS

 For the years ended December 31, 1998, January 1, 1998 and January 2, 1997
                    ------------------------------------
                               (in thousands)
<CAPTION>
                                           1998        1997        1996   
                                        ----------  ----------  ----------
<S>                                     <C>         <C>         <C> 
Cash flows from operating activities:
  Net income                            $   8,992   $   8,451   $   8,208 
  Adjustments to reconcile net income 
    to net cash provided by operating
    activities:
      Depreciation and amortization         2,735       2,735       2,788 
      Changes in assets and liabilities:
        Other receivable                       39          15        (122)
        Other assets                        1,029       1,037       1,110 
        Unearned rental income                 54         (45)         14 
                                        ---------   ---------   --------- 
    Net cash provided by operating 
      activities                           12,849      12,193      11,998 
                                        ---------   ---------   --------- 

Cash flows from financing activities:
  Repayment of term loan                   (3,076)     (2,867)     (2,674)
  Distribution to partners                 (9,773)     (9,326)     (9,324)
                                        ---------   ---------   --------- 
    Net cash (used in) provided by 
      financing activities                (12,849)    (12,193)    (11,998)
                                        ---------   ---------   --------- 
Net change in cash                             --          --          -- 

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

Supplemental disclosure of cash 
  flow information:
    Interest paid                       $   4,863   $   5,407   $   5,633 
                                        =========   =========   ========= 

</TABLE>








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

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

                       STATEMENTS OF PARTNERS' CAPITAL

 For the years ended December 31, 1998, January 1, 1998 and January 2, 1997
                     -----------------------------------
                               (in thousands)
<CAPTION>

                                                                  Total   
                                                                Partners' 
                                          Adamar      Jaffe      Capital  
                                        ----------  ----------  ----------
<S>                                     <C>         <C>         <C>
Balance, December 28, 1995              $    (551)  $   5,066   $   4,515 
  Net income                                4,104       4,104       8,208 
  Cash withdrawals                         (4,662)     (4,662)     (9,324)
                                        ---------   ---------   --------- 
Balance, January 2, 1997                   (1,109)      4,508       3,399 
  Net income                                4,225       4,226       8,451 
  Cash withdrawals                         (4,663)     (4,663)     (9,326)
                                        ---------   ---------   --------- 
Balance, January 1, 1998                   (1,547)      4,071       2,524 
  Net income                                4,496       4,496       8,992 
  Cash withdrawals                         (4,886)     (4,887)     (9,773)
                                        ---------   ---------   --------- 
Balance, December 31, 1998              $  (1,937)  $   3,680   $   1,743 
                                        =========   =========   ========= 


</TABLE>
























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

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

                        NOTES TO FINANCIAL STATEMENTS

1.  Significant Accounting Policies:

  Basis of Financial Statements

  The financial statements include the accounts of Tropicana Enterprises, a
  Nevada General Partnership (the "Partnership").  Adamar of Nevada
  ("Adamar"), a wholly-owned subsidiary of Aztar Corporation ("Aztar"), and
  the Jaffe Group ("Jaffe") each hold a 50% partnership interest.  On February
  2, 1998, Aztar acquired an option to purchase the Jaffe partnership
  interest.  On February 1, 1999, Aztar amended this option.  The amended
  option agreement gives Aztar an unconditional right, but not the obligation,
  to purchase the Jaffe partnership interest until as late as February 1,
  2002.  The Partnership uses a 52/53 week fiscal year ending on the Thursday
  nearest to December 31, which included 52 weeks in 1998 and 1997, and 53
  weeks in 1996. 

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

  Estimates

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

  Properties

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

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

  Deferred Lease Costs

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

  Revenue Recognition

  Rental revenue is recorded on a straight line basis over the term of the
  lease.  Accrued rent, recorded in the accompanying balance sheets as other
  assets, represents cumulative amounts receivable in excess of cash basis
  rental revenue.
                                    F-38
<PAGE>
                            TROPICANA ENTERPRISES
                       (A Nevada General Partnership)

                  NOTES TO FINANCIAL STATEMENTS-(Continued)

  Income Taxes

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

2.  Customer Concentration:

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

3.  Income Producing Properties:
<TABLE>
  The income producing properties consist of the following (in thousands):
<CAPTION>
                                           December 31,     January 1,
                                               1998            1998   
                                           ------------     ----------
          <S>                                <C>            <C>
          Buildings                          $  84,226      $  84,226 
          Less accumulated depreciation        (43,625)       (40,902)
                                             ---------      --------- 
                                                40,601         43,324 
          Land                                  11,417         11,417 
                                             ---------      --------- 
                                             $  52,018      $  54,741 
                                             =========      ========= 
</TABLE>
4.  Other Assets:
<TABLE>
  Other assets consist of the following (in thousands):
<CAPTION>
                                           December 31,     January 1,
                                               1998            1998   
                                           ------------     ----------
          <S>                                <C>            <C>
          Accrued rent                       $   9,867      $  10,896 
          Deferred lease costs                     119            131 
                                             ---------      --------- 
                                             $   9,986      $  11,027 
                                             =========      ========= 
</TABLE>
5.  Term Loan Payable:

  On October 5, 1994, the Partnership entered into a term loan of $72,523,000
  with a group of banks.  During 1998, the maturity of the term loan was
  extended to June 30, 2003.  The term loan was used to refinance a prior loan
  in the same amount.  The term loan is collateralized by the Tropicana
  Property and is serviced through rent payments made by the Tropicana
  operation.  Interest is computed based upon, at the Partnership's option,
  a one-, two-, three- or six-month Eurodollar rate plus a margin ranging from
  


                                    F-39
<PAGE>
                            TROPICANA ENTERPRISES
                       (A Nevada General Partnership)

                  NOTES TO FINANCIAL STATEMENTS-(Continued)

  1.00% to 2.25%, or the prime rate plus a margin ranging from zero to 1.00%. 
  The applicable margin to be used in connection with either rate is
  determined based upon outstanding indebtedness and operating cash flow of
  Aztar.  Interest based on the Eurodollar rate is payable quarterly or on the
  last day of the applicable Eurodollar interest period, if earlier.  Interest
  based on the prime rate is payable quarterly.  The effective interest rate
  was 7.8% for the year ended December 31, 1998.

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

  Maturities of the term loan for the five years subsequent to December 31,
  1998 are as follows (in thousands):

                                 1999                 $  3,297
                                 2000                    3,536
                                 2001                    3,791
                                 2002                    4,101
                                 2003                   45,503
                                                      --------
                                                      $ 60,228
                                                      ========

6.  Lease Agreement:

  In 1984, the Partnership signed an agreement to lease its operating
  facilities at the Tropicana, which expires in January 2011.  The lease
  agreement provides for contingent rental income based on the consumer price
  index and/or interest rate fluctuations in the prime or Eurodollar rates. 
  The lease of the facility is treated as an operating lease except for the
  portion related to the furniture and equipment which was capitalized.  The
  accompanying statements of operations reflect rent revenue on a straight
  line basis over the term of the lease.  Included in the accompanying balance
  sheets under other assets is accrued rent of $9,867,000 and $10,896,000, as
  of December 31, 1998 and January 1, 1998, respectively, which represents
  future rent payments.

  Minimum future rentals on the non-cancelable operating lease as of December
  31, 1998, excluding contingent rental income as described above, are as
  follows (in thousands):

                                 1999                $  14,178
                                 2000                   14,178
                                 2001                   14,288
                                 2002                   14,325
                                 2003                   14,325
                                 Thereafter            101,468
                                                     ---------
                                                     $ 172,762
                                                     =========



                                    F-40
<PAGE>
                            TROPICANA ENTERPRISES
                       (A Nevada General Partnership)

                  NOTES TO FINANCIAL STATEMENTS-(Continued)

7.  Related Parties:

  The Partnership leases substantially all of the operating facilities at the
  Tropicana Property to HRN.  The Partnership recognized rental income of   
  $16,540,000 in 1998, $16,554,000 in 1997 and $16,652,000 in 1996 related to
  this lease.

  Aztar performs various accounting and administrative services on behalf of
  the Partnership.  No expense is allocated to the Partnership for these
  services.











































                                    F-41
<PAGE>
Management's Discussion and Analysis

Financial Condition -
Liquidity and Capital Resources

  Sources and Uses

During 1998, the company obtained new financing consisting of a $250 million
reducing revolving credit note maturing on June 30, 2003 ("Revolver") and a
$50 million term loan maturing on June 30, 2005 ("Term Loan").  The Revolver
and the Term Loan bear interest at a floating rate.  The new financing is an
improvement over the company's prior credit facilities because it increases
the availability of funds, provides more flexibility, reduces interest margins
and extends the maturity.  The funds borrowed under the Revolver were used to
prepay the balance outstanding and extinguish the prior reducing revolving
credit note maturing on December 31, 1999 ("Original Credit Facility").  The
balance outstanding under the Original Credit Facility at the time of
prepayment was $135 million.  The funds received under the Term Loan were used
to repay a portion of the Revolver.  The company's $25 million supplemental
reducing revolving loan agreement maturing on March 15, 1999 ("Supplemental
Credit Facility"), was extinguished concurrently with the Original Credit
Facility.  There were no borrowings under the Supplemental Credit Facility
from its inception through the date it was extinguished.

At December 31, 1998, the outstanding balance under the Revolver was $53.1
million.  The $250 million maximum amount available under the Revolver will
be reduced quarterly by $10 million commencing on September 30, 2000.  The
Revolver imposes various restrictions on the company, including limitations
on its ability to incur additional debt, commit funds to capital expenditures,
merge or sell assets.  The Revolver prohibits dividends on the company's
common stock, other than dividends payable in common stock, and repurchases
of the company's common stock in excess of $30 million with certain limited
exceptions.  In addition, the Revolver contains certain quarterly financial
tests, including a minimum requirement for operating cash flow, a minimum
ratio of debt service coverage and maximum ratios of total debt and senior
debt to operating cash flow.  At December 31, 1998, the ratio of total debt
to operating cash flow was 3.44 to 1 and the maximum ratio allowable was 5.25
to 1.  This maximum ratio allowable decreases to 5.00 to 1 at June 30, 1999
and continues to decrease periodically, beginning June 30, 2000, in increments
of .25 or .50, until it is 4.00 to 1 at June 30, 2002 and thereafter.  At
December 31, 1998, the ratio of senior debt to operating cash flow was 1.09
to 1 and the maximum ratio allowable was 3.50 to 1. This maximum ratio
allowable decreases to 3.00 to 1 at June 30, 1999 and thereafter.

The $50 million Term Loan calls for quarterly principal payments of $125,000
beginning on September 30, 1999 through June 30, 2004, and $11,875,000
beginning on September 30, 2004 through maturity. The Term Loan imposes
restrictions on the company that are similar to those imposed by the company's
subordinated debt.

During 1998, the company's cash flow from operating activities was principally
used to pay down debt and to purchase property and equipment that was
primarily routine in nature. 





                                    F-42
<PAGE>
The company's 11% Senior Subordinated Notes Due 2002 are callable at a premium
and become callable at par on October 1, 1999.  The company's 13 3/4% Senior
Subordinated Notes Due 2004 become callable at a premium on October 1, 1999. 
If credit is available at favorable rates, the company may pursue a
refinancing of its senior subordinated debt during 1999.  If the company were
successful in refinancing this debt, the unamortized deferred financing
charges and unamortized discount associated with the existing senior
subordinated debt would be written off as an extraordinary charge.  At
December 31, 1998, these unamortized items totaled $9.5 million.  Any premium
paid to retire this debt would also be an extraordinary charge. 

  Future Development

Tropicana Enterprises, a Nevada general partnership in which the company is
a noncontrolling 50% partner, owns the real property and certain personal
property that the company leases in the operation of the Las Vegas Tropicana. 
On February 2, 1998, the company acquired an option to purchase the 50%
partnership interest that it does not own.  On February 1, 1999, the company
amended this option.  The amended option agreement gives the company an
unconditional right, but not the obligation, to purchase the partnership
interest for $120 million until as late as February 1, 2002.  The company has
engaged an investment bank to explore alternatives for a major redevelopment
of the property.  The amount and timing of any future expenditure, and the
extent of any impact on existing operations, will depend on the nature of the
redevelopment ultimately undertaken by the company.

The company owns land that is in proximity to its facilities in Atlantic City. 
This land could be used for additional development.

  Commitments

The company is committed to making rent payments that service a bank term loan
("Bank Term Loan") payable by Tropicana Enterprises.  During 1998, the
maturity of the Bank Term Loan was extended to June 30, 2003 from December 31,
1999.  The Bank Term Loan calls for monthly principal payments of $0.3 million
to $0.4 million, with a final payment of approximately $43 million due at
maturity.  The Bank Term Loan balance at December 31, 1998, was approximately
$60 million.

The Tropicana Las Vegas lease agreement contains a provision that requires the
company to maintain an additional security deposit with the lessor of
approximately $21 million in cash or a letter of credit if the Tropicana Las
Vegas operation fails to meet certain financial tests.  A determination has
been made for the year ended December 31, 1998, that the additional security
deposit would be required by May 15, 1999; however, the lessor has waived the
requirement.  The financial tests are calculated quarterly based on the
preceding twelve months of operations.

Results of Operations -
1998 versus 1997

Aztar's consolidated revenues were $806.1 million for 1998, an increase of 3%
from $782.4 million in 1997.  Casino revenue was the primary source of the
increase and the Atlantic City Tropicana was the principal location providing
the increase.



                                    F-43
<PAGE>
Consolidated operating income in 1998 was $81.6 million compared with $67.4
million in 1997.  The consolidated provision for doubtful accounts increased
by $2.0 million in 1998 compared with 1997 as a result of increasing the
allowance for potential uncollectible markers associated with the emphasis on
the games segment of the market at the Atlantic City Tropicana.  Excluding the
increase in the consolidated provision for doubtful accounts, operating costs
increased by only 1% in 1998.  Consolidated rent expense decreased $2.0
million in 1998 compared with 1997 primarily as a result of buying out
operating leases or converting them to capital leases at the Atlantic City
Tropicana.  The analysis of the performance of each of Aztar's properties
follows.

  Tropicana Atlantic City

Tropicana Casino and Resort in Atlantic City, New Jersey had total revenues
of $418.9 million in 1998 compared with $399.2 million in 1997 and operating
income of $66.5 million in 1998 compared with $50.7 million in 1997.  Casino
revenue was up $18.2 million in 1998 from 1997.  Tropicana Atlantic City
continued its emphasis that began in 1995 on the games revenue segment of the
business and benefited from an increase in the table games hold percentage to
15.8% in 1998 from 14.5% in 1997.  Games revenue increased by $10.2 million
or 8% in 1998 compared with 1997.  Slot revenue also increased in 1998
compared with 1997.  Slot revenue was up 3% in 1998.  The slot revenue
percentage of total casino revenue decreased to 65% in 1998 from 66% in 1997. 
The percentage was 71% in 1996 and 76% in the 1995 to 1993 time frame.  Rooms
revenue increased 21% in 1998 compared with 1997 as a result of an increase
in rooms occupied on a non-complimentary basis and an increase in the average
daily room rate.  

Rooms costs were 18% higher in 1998 compared with 1997 primarily due to the
increase in rooms revenue.  The provision for doubtful accounts was $3.8
million higher in 1998 compared with 1997 as a result of the emphasis on the
games business. Excluding the provision for doubtful accounts, operating costs
in 1998 were essentially even with 1997.  Utilities expense was $1.1 million
lower in 1998 compared with 1997 primarily due to a favorable electrical power
contract that began in November 1997.  Operating income is after depreciation
and amortization of $24.3 million in 1998 compared with $22.1 million in 1997
and rent expense of $4.5 million in 1998 compared with $7.3 million in 1997. 
Rent expense decreased as a result of a shift away from operating leases to
capital leases or ownership.

  Tropicana Las Vegas

Tropicana Resort and Casino in Las Vegas, Nevada had total revenues of $154.2
million in 1998 compared with $156.4 million in 1997 and an operating loss of
$10.6 million in 1998 compared with an operating loss of $9.3 million in 1997. 
Operating loss is after rent expense of $10.0 million in 1998 compared with
$9.8 million in 1997 and depreciation and amortization of $9.8 million in 1998
compared with $9.5 million in 1997.

Casino revenue decreased by $3.6 million in 1998 from 1997 as a result of a
decrease in table games revenue.  Table games revenue other than baccarat
decreased as a result of a decrease in the hold percentage, which decreased
to 15.6% from 18.6% in 1997.  The volume of baccarat play decreased by 35% in 




                                    F-44
<PAGE>
1998 from 1997 on top of a 40% decrease in 1997 from 1996 as the company
experienced a decrease in baccarat play by Asian guests as a result of
economic turmoil in Asia and a strategic decision to place less emphasis on
Asian players.  The volume of baccarat play was much higher in 1996 than it
had been in recent prior years.  Baccarat revenue as a percent of casino
revenue declined to 9% in 1998 and 1997 compared to 14% in 1996.  Baccarat
revenue was only 1% of casino revenue in 1995.  Baccarat revenue in 1998
benefited from an increase in the hold percentage, which increased to 28.8%
from 18.6% in 1997.  Slot revenue increased by 5% in 1998 over 1997.  Casino
costs were substantially unchanged in 1998 from 1997.  The hotel occupancy
rate increased to 92% in 1998 from 88% in 1997 in spite of the increased
competition in the Las Vegas market.  

  Ramada Express

Ramada Express Hotel and Casino in Laughlin, Nevada had total revenues of
$85.3 million in 1998 compared with $83.4 million in 1997.  Casino revenue
increased by $2.0 million in 1998 compared with 1997.  The trends in 1998 were
similar to those experienced in 1997 and 1996 with the exception of the
overall market.  The overall market was slightly up in 1998 from 1997, which
is in contrast to the last several years of decreases in the overall market. 
However, the overall market remains weak as competition continues from Indian
casinos and expansions in Las Vegas.  Casino costs and marketing costs were
higher as the company incurred increased costs in order to increase market
share in this market.  As a result, the operating margin, as measured by
operating income before depreciation and amortization, declined to 20% in 1998
from 21% in 1997, compared with 22% in 1996 and 24% in 1995.

Operating income at Ramada Express was $10.6 million in 1998 compared with
$10.6 million in 1997.  Operating income is after depreciation and
amortization of $6.2 million in 1998 compared with $7.1 million in 1997 and
rent expense of $0.6 million in 1998 compared with $0.5 million in 1997.

  Casino Aztar Evansville

Casino Aztar Evansville in Evansville, Indiana had total revenues of $123.6
million in 1998 compared with $119.3 million in 1997. Casino revenue was up
4% in 1998 from 1997 in spite of increased competition from expanded riverboat
capacity in the Cincinnati, Ohio market area and a new riverboat in the
Louisville, Kentucky market area.  The admissions in 1998 and 1997 were 2.1
million and the win per admission was $52.83 in 1998 compared with $51.18 in
1997.  The new riverboat in the Louisville area opened in November 1998.  In
fiscal December 1998, the company had an 18% decrease in casino revenue;
however, there was severe winter weather in Evansville's feeder markets in the
last week of December 1998 compared with December 1997.  The company
anticipates a decrease in casino revenue in 1999 as a result of this new
riverboat.  In addition, a certificate of suitability was granted to operate
a riverboat casino on the Ohio River to be located in Indiana between the
Louisville area and the Cincinnati area.  This riverboat is anticipated to
open in mid- to late-2000.

Operating income was $29.8 million in 1998 compared with $28.8 million in
1997.  Operating income is after depreciation and amortization of $9.8 million
in 1998 compared with $9.3 million in 1997 and rent expense of $3.9 million
in 1998 compared with $3.4 million in 1997.



                                    F-45
<PAGE>
  Casino Aztar Caruthersville

Casino Aztar Caruthersville in Caruthersville, Missouri had total revenues of
$24.1 million in 1998 and 1997 and an operating loss of $1.5 million in 1998
compared with an operating loss of  $2.8 million in 1997.  The operating
losses are after depreciation and amortization of $3.2 million in 1998
compared with $3.3 million in 1997.  During 1998, the company focused on
reducing its operating costs and was able to reduce these costs by 5% compared
with 1997 and at the same time was able to maintain its revenue stream.  The
company has some unused land at this site and is searching for development
opportunities with other entities to use the land for facilities that would
complement the company's operations.  

  Development Costs

In connection with the company pursuing the development of its business in
certain gaming jurisdictions, the company expensed approximately $0.5 million
in 1998 compared with $0.1 million in 1997.

  Interest Expense

Interest expense was $59.6 million in 1998 compared with $62.5 million in
1997.  The decrease in interest expense was primarily a result of lower levels
of debt outstanding.

  Income Taxes

The company is responsible, with certain exceptions, for the taxes of Ramada
Inc. ("Ramada") through December 20, 1989.  See "Note 1. Significant
Accounting Policies - Basis of Consolidated Statements of the Notes to
Consolidated Financial Statements".  Income taxes for 1997 included a non-
recurring tax benefit of $2.3 million primarily related to cash received as
a result of a settlement between the IRS and Ramada.  Income taxes for 1996
included a benefit of approximately $21 million related to this settlement.

  Extraordinary Items

During 1998, the company expensed the remaining unamortized deferred financing
costs in connection with the extinguishment of the Original Credit Facility
and the Supplemental Credit Facility.  These items were reflected as an
extraordinary loss of $1.3 million, which was net of an income tax benefit of
$0.7 million.

Results of Operations -
1997 versus 1996

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




                                    F-46
<PAGE>
Consolidated operating income in 1997 was $67.4 million.  Consolidated
operating income in 1996 was $58.9 million after the effects of $3.0 million
in preopening cost writeoffs in connection with the new hotel tower at the
Atlantic City Tropicana and the fourth-quarter 1996 opening of a pavilion,
parking garage and hotel at Casino Aztar Evansville.  The consolidated
provision for doubtful accounts increased by $7.1 million in 1997 compared
with 1996 as a result of increasing the allowance for potential uncollectible
markers associated with Asian guests at the Las Vegas Tropicana and the
premium table game business at both Tropicanas.  Consolidated rent expense
increased $5.7 million in 1997 compared with 1996 primarily as a result of an
increased number of operating leases associated with expanded casino
facilities at the Atlantic City Tropicana.  The analysis of the performance
of each of Aztar's properties follows.

  Tropicana Atlantic City

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

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

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

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





                                    F-47
<PAGE>
  Tropicana Las Vegas

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

Casino revenue decreased by 12% in 1997 from 1996 primarily as a result of a
decrease in baccarat revenue.  The volume of baccarat play decreased by 40%
in 1997 compared to 1996 as the company experienced a decrease in baccarat
play by Asian guests.  Slot revenue decreased by 10% in 1997 compared to 1996
due to a supply increase in the market.  Casino costs were 6% lower in 1997
than in 1996 as a result of the lower casino revenue.  The provision for
doubtful accounts increased by $5.0 million in 1997 compared with 1996 as a
result of increasing the allowance for uncollectible markers associated with
Asian guests and the premium table game business.  

  Ramada Express

Ramada Express Hotel and Casino had total revenues of $83.4 million in 1997
compared with $82.5 million in 1996.  Casino revenue increased in an overall
market that again declined in 1997. Casino costs and marketing costs were
higher as the company incurred increased costs in order to increase market
share in this declining market.

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

  Casino Aztar Evansville

Casino Aztar Evansville had total revenues of $119.3 million in 1997 compared
with $115.2 million in 1996 and operating income of $28.8 million in 1997
compared with $27.5 million in 1996.  The 1996 operating income is after the
writeoff of $0.7 million of preopening costs associated with the opening of
the passenger pavilion, parking garage and 250-room hotel. Casino revenue was
down only slightly in 1997 from 1996 as a decrease in admissions as a result
of the increased competition from other riverboats in Indiana was offset by
an increase in win per admission. The admissions in 1997 were 2.1 million
compared with 2.4 million in 1996 and the win per admission was $51.18 in 1997
compared with $45.85 in 1996.  Rooms revenue was $2.7 million in 1997, an
increase of $2.6 million over 1996 as the hotel opened in December 1996.  Food
and beverage revenue increased $3.0 million over 1996 as the passenger
pavilion containing expanded food and beverage facilities opened in the fourth
quarter of 1996.

Rooms costs and food and beverage costs increased with the increase in
revenues.  As a result of the expanded facilities, property taxes and
insurance, along with depreciation and amortization, also increased.  Casino
Aztar Evansville reduced marketing costs by 20% in 1997 from 1996.  These
costs were higher in 1996 as the operation established itself in the market. 
Operating income is after depreciation and amortization of $9.3 million in
1997 compared with $8.3 million in 1996 and rent expense of $3.4 million in
1997 compared with $3.0 million in 1996.

                                    F-48
<PAGE>
  Casino Aztar Caruthersville

Casino Aztar Caruthersville had total revenues of $24.1 million in 1997
compared with $26.5 million in 1996 and an operating loss of $2.8 million in
1997 compared with an operating loss of  $3.7 million in 1996.  The operating
losses are after depreciation and amortization of $3.3 million in 1997
compared with $3.5 million in 1996.  During 1997, the company eliminated some
marginal business, which resulted in lower revenues and reduced costs.  In
addition, the company implemented its plans and opened a climate-controlled
pavilion and an outdoor arena.  These facilities are used for exhibitions,
entertainment, rodeo competitions and other events.

  Development Costs

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

  Interest Expense

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

Market Risk

Market risk is the risk of loss arising from adverse changes in market rates
and prices, such as interest rates, foreign currency exchange rates, commodity
prices and equity prices.  The company's primary exposure to market risk is
interest rate risk associated with its Casino Reinvestment Development
Authority ("CRDA") investments, long-term debt and Series B ESOP convertible
preferred stock.  The company does not utilize these financial instruments for
trading purposes.  The company manages its interest rate risk on long-term
debt by managing the mix of its fixed-rate and variable-rate debt.






















                                    F-49
<PAGE>
<TABLE>
The following table provides information at December 31, 1998, about the
company's financial instruments that are sensitive to changes in interest
rates.  The table presents principal cash flows (in millions) and related
weighted average interest rates by expected maturity dates.

<CAPTION>
                                                       There-         Fair
                      1999  2000   2001   2002   2003  after   Total  Value
<S>                   <C>   <C>   <C>   <C>     <C>    <C>     <C>    <C>
Assets
  Other investments
      Fixed rate        --    --    --     --     --   $ 21.0  $ 21.0 $ 21.0
      Average 
        interest rate   --    --    --     --     --      4.9%

Liabilities
  Long-term debt,
    including current
    portion
      Fixed rate      $2.4  $3.1  $2.0  $200.9  $ 0.2  $178.4  $387.0 $411.6
      Average
        interest rate  9.8%  9.4%  9.7%   11.0%  10.6%   14.0%

      Variable rate   $0.1  $0.5  $0.6  $  0.5  $53.6  $ 47.8  $103.1 $103.1
      Average 
        interest rate*

Series B ESOP
  convertible 
  preferred stock
      Fixed rate        --   --     --    --        -- $  7.1  $  7.1 $  7.1
      Average 
        dividend rate   --   --     --    --        --    8.0%

* Interest is based upon, at the company's option, a one-, two-, three- or
  six- month Eurodollar rate plus a margin of 2.5% for the $50 million Term
  Loan and a one-, two-, three- or six month Eurodollar rate plus a margin
  ranging from 1.00% to 2.25%, or the prime rate plus a margin ranging from
  zero to 1.00% for the Credit Facility.  The applicable margin is dependent
  upon the company's outstanding indebtedness and operating cash flow.
</TABLE>
Year 2000

  Background

In the past, many computer software programs were written using two digits
rather than four to define the applicable year.  As a result, date-sensitive
computer software may recognize a date using "00" as the year 1900  rather
than the year 2000.  This is generally referred to as the Year 2000 issue. 
If this situation occurs, the potential exists for computer system failures
or miscalculations by computer programs, which could disrupt operations.

The company utilizes computer systems in virtually all aspects of its
business.  In particular, Year 2000 problems in the hotel or casino systems
at the company's properties could disrupt operations at the affected
properties and have a material adverse impact upon the company's operating
results.  The company is also exposed to the risk that one or more of its 


                                    F-50
<PAGE>
suppliers could experience Year 2000 problems that impact the ability of such
suppliers to provide goods and services.  Though this is not considered as
significant a risk with respect to the suppliers of goods, due to the
availability of alternative suppliers, the disruption of certain services,
such as utilities, could, depending upon the extent of the disruption, have
a material adverse impact on the company's operations.

  Approach

The company has established a coordinated effort between its corporate level
and responsible parties at each of its properties to address the company's
response to Year 2000 issues.  Among the efforts underway to monitor Year 2000
readiness is each property's monthly submission to the corporate office of a
Year 2000 status report, which is then reviewed with each property.  The
status of each property's Year 2000 readiness is in turn discussed at least
quarterly with the Audit Committee of the company's Board of Directors.  The
company has established a program for the Year 2000 issue that consists of the
following phases:

     Phase 1    Compilation of an inventory of information technology (IT) and
                non-IT systems that may be sensitive to the Year 2000 problem.

     Phase 2    Identification and prioritization of the critical systems from
                the systems inventory compiled in Phase 1 and inquiries of
                third parties with whom the company does significant business
                (i.e., vendors and suppliers) as to the state of their Year
                2000 readiness.

     Phase 3    Analysis of critical systems to determine which systems are
                not Year 2000 compliant and evaluation of the costs to repair
                or replace those systems.

     Phase 4    Repair or replace noncompliant systems and testing of those
                systems for which representation as to Year 2000 compliance
                has not been received or for which representation was received
                but has not been confirmed.
  Status

          IT Systems
     
          The company utilizes software purchased from vendors in virtually
          all critical technology systems at its properties.  In certain
          instances, such vendor-supplied software is modified through the use
          of internal programming to enhance these systems.  In many cases,
          the solution to the Year 2000 issue is simply to install a vendor-
          tested software upgrade ("Upgrade") and further test the Upgrade
          through internally generated test data. In other cases, the company
          is purchasing and installing new vendor software ("Conversion") that
          is Year 2000 compliant.  The cost and effort to install and test new
          software systems is more extensive than the aforementioned Upgrade
          and therefore these Conversions contain more risks to the company.







                                    F-51
<PAGE>
<TABLE>
          The company is currently in Phase 4 on all critical IT systems at
          all properties.  The following chart shows for each critical IT
          system at each of its properties whether an Upgrade or Conversion
          is underway and the date when installation and testing of such
          systems is expected to be completed.  In addition, the chart
          identifies those IT systems where internal programming is required
          and the extent of such programming requirements.  The more
          programming required, the greater the risk to the company's Year
          2000 readiness.
<CAPTION>
              TROPICANA
              ATLANTIC    TROPICANA    RAMADA    CASINO AZTAR CASINO AZTAR 
 SYSTEM        CITY       LAS VEGAS    EXPRESS    EVANSVILLE CARUTHERSVILLE
---------    ----------   ---------  ----------- --------------------------
<C>          <C>           <C>        <C>          <C>         <C>
Casino       Conversion    Upgrade     Upgrade      Upgrade     Upgrade   
                 *           **    
                5/99        Done         6/99         6/99        6/99    

Slots         Upgrade      Upgrade    Conversion    Upgrade     Upgrade   
                             **           *     
                3/99        Done         9/99         3/99        3/99    

Hotel        Conversion    Upgrade    Conversion    Upgrade       N/A     
                 **      
               Done         Done        Done         Done    

Financial    Conversion    Upgrade     Upgrade      Upgrade     Upgrade   
               Done         Done         6/99         6/99        6/99    

Point of
 Sale/        Upgrade      Upgrade    Conversion    Upgrade     Upgrade   
Inventory       3/99         6/99        6/99         4/99        4/99    

   *  Indicates more significant internal programming also required
  **  Indicates minor internal programming also required
</TABLE>
          Non-IT Systems

          The company utilizes embedded technology such as microcontrollers
          or date-sensitive computer chips in its facilities including, fire
          safety and security systems, elevators, heating and cooling
          monitoring systems and surveillance systems ("Non-IT Systems").  The
          company is in Phase 3 and 4 in the process of ensuring Year 2000
          readiness in these Non-IT Systems.  Procedures being utilized
          include: vendor letters to critical Non-IT Systems providers asking
          for the Year 2000 status for each embedded chip or technology;
          meetings with vendors who provide maintenance for these Non-IT
          Systems to assess Year 2000 readiness; and testing of such systems
          using test data wherever possible.  The company expects to have
          completed Year 2000 compliance on Non-IT Systems by April 1999.

  Costs

The total cost to the company of making its systems Year 2000 compliant is
estimated to be approximately $7.9 million.  Approximately $7.5 million of 



                                    F-52
<PAGE>
this amount relates to the acquisition of new computer hardware and software
systems as follows:  new hardware and software at Tropicana Atlantic City
($5.7 million); new software at Ramada Express ($1.2 million) and personal
computer upgrades and other systems companywide ($0.6 million).  These costs
will be capitalized and depreciated over their expected useful lives.

The estimated costs related to internal programming modifications and the
company's administration of its Year 2000 project are approximately $0.4
million, and such costs are being expensed as incurred.  Approximately $0.2
million of these costs were expensed in 1998.

As of December 31, 1998, approximately $5.5 million has been spent on Year
2000 issues.  The Year 2000 issue has not caused other company IT system
projects to be deferred; in fact, it has accelerated the spending on IT
systems overall.

  Risk Assessment

The greatest risk to the company is if one or more of its properties' critical
IT systems, such as casino or hotel, or Non-IT Systems, such as cooling or
heating, experience problems due to Year 2000 issues which cause business
interruptions or customer service problems.  The company is also exposed to
the risk of possible failure of systems external to the company's operations
("External Risk Factors").  These External Risk Factors arise from the fact
that the company's operations, like most businesses, are dependent upon
numerous other private, public and governmental entities.  While these
External Risk Factors are not the responsibility of the company and the
remediation of these factors is beyond the company's control, we are
attempting to monitor these risks and form contingency plans as warranted. 
As a result of these External Risk Factors, the company may be adversely
impacted even if its own IT systems and Non-IT Systems are Year 2000
compliant.  External Risk Factors being monitored include utility service to
the company's properties; banking networks which may affect properties' or
customers' access  to cash and travel service disruptions to the company's
properties.  The company believes that any Year 2000 problems, should they
arise, would be short-term in nature and not affect the company's liquidity
or financial condition.  However, because New Year's week is a very busy
period for the company's properties, Year 2000 problems at a given property
could negatively impact first-quarter 2000 results.

  Contingency Plans

The company has had general discussions regarding contingency plans should
Year 2000 problems arise, including the possibility of utilizing other Aztar
properties' systems should a problem arise at a given property.  However, a
formal contingency plan has not been completed.  

Contingency plans will be assessed, by property, considering risk levels of
non-compliance as the Year 2000 implementation and testing process continues. 
On an on-going basis, each property maintains certain emergency manual
procedures and back-up plans.  These alternatives will be considered as each
property assesses its formal Year 2000 contingency plan.






                                    F-53
<PAGE>
Other Matters

In April 1998, the Accounting Standards Executive Committee of the American
Institute of Certified Public Accountants issued Statement of Position No. 98-
5 entitled "Reporting on the Costs of Start-up Activities" ("SOP").  The SOP
stipulates that all costs that meet its definition of start-up activities,
which the company has referred to as preopening costs, must be expensed as
incurred.  The provisions of the SOP are effective for fiscal years beginning
after December 15, 1998.  Upon adoption, entities are required to write off
all capitalized start-up costs as a cumulative effect of a change in
accounting principle. Entities are not required to report the pro forma effect
of retroactive application.  The company will adopt this SOP when required.
The company's policy has been to capitalize these costs as incurred and to
expense them in the period the related facility commences operations. 
Adoption of the SOP will have only a prospective effect on the company's
financial statements, as there were no capitalized preopening costs at
December 31, 1998. 

In June 1998, the Financial Accounting Standards Board ("FASB") adopted
Statement of Financial Accounting Standards No. 133 entitled "Accounting for
Derivative Instruments and Hedging Activities" ("SFAS 133"), which establishes
accounting and reporting standards for derivative instruments and for hedging
activities.  It requires that an entity  recognize all derivatives as either
assets or liabilities in the statement of financial position and measure those
instruments at fair value.  If certain conditions are met, a derivative may
be specifically designated as a hedge of certain financial exposures.  The
accounting for changes in the fair value of a derivative depends on the
intended use of the derivative and, if it is used in hedging activities, it
depends on its effectiveness as a hedge.  SFAS 133 is effective for all fiscal
quarters of fiscal years beginning after June 15, 1999.  SFAS 133 should not
be applied retroactively to financial statements of prior periods.  The
company will adopt SFAS 133 when required.  Because of the company's minimal
use of derivatives, the company does not anticipate that the adoption of SFAS
133 will have a significant effect on its earnings or its financial position.

In accordance with the FASB Statement of Financial Accounting Standards No.
121 entitled "Accounting for the Impairment of Long-Lived Assets and for Long-
Lived Assets to Be Disposed Of", the company performed a review of whether
anticipated net cash flows in connection with its Casino Aztar Caruthersville
operation will be sufficient to recover the company's investment in that
operation.  At December 31, 1998, the company had approximately $43 million
in carrying value of long-lived assets and certain identifiable intangibles
associated with Casino Aztar Caruthersville.  In performing this review, the
company considered a number of factors, including, but not limited to,
anticipated revenues and the duration thereof, expected operating costs, the
competitive environment and future legislative and regulatory changes. 
Although the results of the company's review did not have an effect on the
carrying value for Casino Aztar Caruthersville at December 31, 1998, there can
be no assurance that this will be true in the future.









                                    F-54
<PAGE>
Private Securities Litigation Reform Act

Certain information included in Aztar's 1998 Form 10-K and other materials
filed or to be filed by the company with the Securities and Exchange
Commission ("SEC") (as well as information included in oral statements or
other written statements made or to be made by the company including those
made in Aztar's 1998 annual report) contains statements that are forward-
looking.  These include forward-looking statements relating to the following
activities, among others: operation and expansion of existing properties,
including future performance; redevelopment of the Las Vegas Tropicana and
financing and/or concluding an arrangement with a partner for such
redevelopment; other business development activities; refinancing of the
company's indebtedness; use of derivatives; and the Year 2000 issue.  These
activities involve important factors that could cause actual results to differ
materially from those expressed in any forward-looking statements made by or
on behalf of the company.  These include, but are not limited to, the
following factors as well as other factors described from time to time in the
company's reports filed with the SEC: construction and development factors,
including zoning issues, environmental restrictions, soil conditions, weather
and other hazards, site access matters and building permit issues; factors
affecting leverage and debt service, including sensitivity to fluctuation in
interest rates; access to available and feasible financing; regulatory and
licensing approvals; third-party consents, approvals and representations, and
relations with partners, owners, suppliers and other third parties; reliance
on key personnel; business and economic conditions; litigation, judicial
actions and political uncertainties, including gaming legislation and
taxation; and the effects of competition, including locations of competitors
and operating and marketing competition.  Any forward-looking statements are
made pursuant to the Private Securities Litigation Reform Act of 1995 and, as
such, speak only as of the date made. 




























                                    F-55
<PAGE>
<TABLE>
SUMMARY OF SELECTED FINANCIAL DATA
Aztar Corporation and Subsidiaries
For the Five Years Ended December 31, 1998
<CAPTION>
                    1998        1997        1996        1995         1994  
                 ----------  ----------  ----------  ----------   ---------
<S>               <C>        <C>         <C>         <C>          <C>
Statement of
 Operations
 Data (in 
 thousands)
Revenues          $  806,136 $  782,357  $  777,472  $  572,869   $541,440 
Operating income     81,646      67,392      58,943      42,701     69,407 
Net interest 
 income and 
 expense            (57,434)    (60,517)    (56,210)    (47,801)   (46,572)
Equity in 
 unconsolidated 
 partnership's 
 loss                (4,336)     (4,618)     (4,793)     (5,081)    (4,169)
Income taxes         (8,368)      2,185      22,699       5,187     (1,862)
Income (loss) 
 before 
 extraordinary 
 items               11,508       4,442      20,639      (4,994)    16,804 
Extraordinary 
 items               (1,346)         --          --          --     (2,708)
Net income (loss)    10,162       4,442      20,639      (4,994)    14,096 

Common Stock Data 
 (per share)
Income (loss) 
 before 
 extraordinary 
 items: 
   Income (loss) 
     per common 
     share       $      .24  $      .08  $      .48  $     (.15)  $    .43 
   Income (loss) 
     per common  
     share 
     assuming 
     dilution           .23         .08         .46        (.15)       .41 
Cash dividends 
 declared                --          --          --          --         -- 
Equity                10.02        9.82        9.76        9.40       9.65 

Balance Sheet 
 Data (in 
 thousands at 
 year end)
Total assets     $1,077,702  $1,091,496  $1,119,582  $1,013,238   $915,359 
Long-term debt      487,543     491,932     527,006     496,439    430,212 
Series B ESOP 
 convertible 
 preferred 
 stock                7,147       6,593       6,022       5,459      4,711 
Shareholders' 
 equity             454,101     444,038     439,274     359,659    361,368 
</TABLE>
                                    F-56
<PAGE>
                      REPORT OF INDEPENDENT ACCOUNTANTS
                      ---------------------------------







To the Shareholders and Board of Directors
Aztar Corporation




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

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









PRICEWATERHOUSECOOPERS LLP






Phoenix, Arizona
February 3, 1999














                                     S-1
<PAGE>
<TABLE>
               SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                     AZTAR CORPORATION AND SUBSIDIARIES
 For the Years Ended December 31, 1998, January 1, 1998 and January 2, 1997 
                               (in thousands)
<CAPTION>

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

                      Balance at                                Balance at
                      Beginning                                   End of
   Description         of Year    Additions      Deductions        Year    
------------------- ------------ ------------    ----------    ------------
<S>                 <C>          <C>             <C>           <C>
Allowance for 
 doubtful accounts 
 receivable:
 1998               $  17,919    $  14,913(a)    $   7,536(b)  $  25,296
 1997                  11,261       12,944(a)        6,286(b)     17,919
 1996                   9,905        5,892(a)        4,536(b)     11,261

Deferred income 
 tax asset 
 valuation 
 allowance:
 1998               $   4,881    $     303(a)    $   1,841(c)  $   3,343
 1997                   4,328        1,206(a)          653(b)      4,881
 1996                   8,196          718(a)        4,586(c)      4,328

Valuation allowance
 for interest 
 differential on CRDA
 deposits 
 1998               $   6,706    $      52(a)    $       6(d)  $   6,452
                                                       300(e)
 1997                   6,425          569(a)          288(d)      6,706
 1996                   5,927          729(a)          231(d)      6,425

(a)  Charged to costs and expenses.

(b)  Related assets charged against the account.

(c)  Reflects reductions of $1,715,000 and $3,641,000 in 1998 and 1996,
     respectively, with a corresponding decrease in income tax expense.  The
     remainder of the reductions in 1998 and 1996 represented charges of
     deferred tax assets against the valuation allowance account.

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

(e)  Reflects reduction with a corresponding decrease in assets in connection
     with the purchase of assets with funds deposited with the CRDA. 
</TABLE>







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

3.2       Second Amended and Restated By-Laws of Aztar Corporation, as
          adopted February 25, 1998, filed as Exhibit 3 to Aztar
          Corporation's Form 10-Q for the quarter ended April 2, 1998 and
          incorporated herein by reference.

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

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

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

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

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

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

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

*10.3(b)  Amendment to Severance Agreement, dated March 23, 1998, by and
          between Aztar Corporation and Paul E. Rubeli, filed as Exhibit 10.1
          to Aztar Corporation's Form 10-Q for the quarter ended April 2,
          1998 and incorporated herein by reference.

*Indicates a management contract or compensatory plan or arrangement. 
                                    E-1
<PAGE>
EXHIBIT INDEX
-------------
*10.3(c)  Severance Agreement, dated July 17, 1995, by and between Aztar
          Corporation and Robert M. Haddock, filed as Exhibit 10.2 to Aztar
          Corporation's Form 10-Q for the quarter ended September 28, 1995
          and incorporated herein by reference.

*10.3(d)  Amendment to Severance Agreement, dated March 24, 1998, by and
          between Aztar Corporation and Robert M. Haddock, filed as Exhibit
          10.2 to Aztar Corporation's Form 10-Q for the quarter ended April
          2, 1998 and incorporated herein by reference.

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

*10.3(f)  Amendment to Severance Agreement, dated March 24, 1998, by and
          between Aztar Corporation and Nelson W. Armstrong, Jr., filed as
          Exhibit 10.3 to Aztar Corporation's Form 10-Q for the quarter ended
          April 2, 1998 and incorporated herein by reference.

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

*10.3(h)  Amendment to Severance Agreement, dated March 24, 1998, by and
          between Aztar Corporation and Meridith P. Sipek, filed as Exhibit
          10.4 to Aztar Corporation's Form 10-Q for the quarter ended April
          2, 1998 and incorporated herein by reference.

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

*10.3(j)  Amendment to Severance Agreement, dated March 24, 1998, by and
          between Aztar Corporation and Joe Cole, filed as Exhibit 10.5 to
          Aztar Corporation's Form 10-Q for the quarter ended April 2, 1998
          and incorporated herein by reference.

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

*10.3(l)  Amendment to Severance Agreement, dated March 24, 1998, by and
          between Aztar Corporation and Neil A. Ciarfalia, filed as Exhibit
          10.6 to Aztar Corporation's Form 10-Q for the quarter ended April
          2, 1998 and incorporated herein by reference.




*Indicates a management contract or compensatory plan or arrangement. 

                                    E-2
<PAGE>
EXHIBIT INDEX
-------------
10.4(a)   Amended and Restated Reducing Revolving Loan Agreement, dated as
          of May 28, 1998, among Aztar Corporation and the lenders therein
          named; Bankers Trust Company and Societe Generale, as documentation
          agents; Bank of Scotland, Credit Lyonnais Los Angeles Branch and
          PNC Bank, National Association, as co-agents; and Bank of America
          National Trust and Savings Association, as administrative agent,
          filed as Exhibit 10.1 to Aztar Corporation's Form 10-Q for the
          quarter ended July 2, 1998 and incorporated herein by reference.

10.4(b)   Amendment No. 1, dated October 8, 1998, to Amended and Restated
          Reducing Revolving Loan Agreement, dated as of May 28, 1998, among
          Aztar Corporation and the lenders therein named; Bankers Trust
          Company and Societe Generale, as documentation agents; Bank of
          Scotland, Credit Lyonnais Los Angeles Branch and PNC Bank, National
          Association, as co-agents; and Bank of America National Trust and
          Savings Association, as administrative agent, filed as Exhibit 10.1
          to Aztar Corporation's Form 10-Q for the quarter ended October 1,
          1998 and incorporated herein by reference.

10.4(c)   Term Loan Agreement, dated as of May 28, 1998, among Aztar
          Corporation and the lenders therein named; and Bank of America
          National Trust and Savings Association, as administrative agent,
          filed as Exhibit 10.2 to Aztar Corporation's Form 10-Q for the
          quarter ended July 2, 1998 and incorporated herein by reference.

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

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

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

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

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



*Indicates a management contract or compensatory plan or arrangement. 

                                    E-3
<PAGE>
EXHIBIT INDEX
-------------
10.7(a)   Agreement and Plan of Merger, dated as of April 17, 1989, among New
          World Hotels (U.S.A.), Inc., RI Acquiring Corp. and Ramada Inc.,
          as amended and Restated as of October 23, 1989, filed as Exhibit
          2.1 to Aztar Corporation's Registration Statement No. 33-32009 and
          incorporated herein by reference.

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

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

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

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

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

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

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







*Indicates a management contract or compensatory plan or arrangement. 

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

10.14(a)  Amendment No. 1, dated as of May 28, 1998, to Second Amended and
          Restated Loan Agreement dated as of October 4, 1994, among
          Tropicana Enterprises, Hotel Ramada of Nevada and the banks therein
          named; Bankers Trust Company and Societe Generale, as documentation
          agents; Bank of Scotland, Credit Lyonnais Los Angeles Branch and
          PNC Bank, National Association, as co-agents; and Bank of America
          National Trust and Savings Association, as administrative agent,
          filed as Exhibit 10.3 to Aztar Corporation's Form 10-Q for the
          quarter ended July 2, 1998 and incorporated herein by reference.

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

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

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

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

10.19     Option Agreement, dated February 2, 1998, among Adamar of Nevada,
          parties constituting the Jaffe Group, Aztar Corporation and Hotel
          Ramada of Nevada, filed as Exhibit 99.2 to Aztar Corporation's Form
          8-K/A, dated February 3, 1998, and incorporated herein by
          reference.

**10.19(a)First Amendment to Option Agreement, dated January 28, 1999, to
          Option Agreement, dated February 2, 1998, by and among Adamar of
          Nevada, parties constituting the Jaffe Group, Aztar Corporation and
          Hotel Ramada of Nevada.


*Indicates a management contract or compensatory plan or arrangement. 

**Filed herewith

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EXHIBIT INDEX
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**21.     Subsidiaries of Aztar Corporation. 

**23.     Consent of PricewaterhouseCoopers LLP

**27.     Financial Data Schedule.
















































**Filed herewith

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