FORM 10-Q/A
                                 AMENDMENT NO. 1
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

(Mark One)

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

For the quarterly period ended      September 30, 2005
                               -------------------------

                                       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       0-9624
--------------------------------------------------------------------------------
                    International Thoroughbred Breeders, Inc.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

         Delaware                                        22-2332039
---------------------------------         ------------------------------------
(State or other jurisdiction of           (I.R.S. Employer Identification No.)
 incorporation or organization)

       Suite 1300, 1105 N. Market Street, Wilmington, Delaware 19899-8985
      --------------------------------------------------------------------
               (Address of principal executive offices)(Zip Code)

                                 (302) 427-7599
          ------------------------------------------------------------
              (Registrant's telephone number, including area code)

             (Former name, former address and former fiscal year, if
                          changed since last report.)

     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 last 90 days. Yes X No___

     Indicate by check mark whether the registrant is an  accelerated  filer (as
defined in Rule 12b-2 of the Exchange Act.) Yes___ No X

     Indicate  by check as to whether  the  registrant  is a shell  company  (as
defined in Exchange Act Rule 12b-2). Yes ___ No X

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

     Indicate the number of shares  outstanding of each of the issuer's  classes
of common stock, as of the close of the latest practicable date.

            Class                              Outstanding at March 15, 2006
------------------------------                 -----------------------------
Common Stock, $ 2.00 par value                        11,367,487 Shares




<PAGE>



                    INTERNATIONAL THOROUGHBRED BREEDERS, INC.
                                   FORM 10-Q/A
                                QUARTERLY REPORT
                  for the Three Months ended September 30, 2005
                                   (Unaudited)

                                EXPLANATORY NOTE

This Amendment No. 1 on Form 10-Q/A amends the Registrant's  Quarterly Report on
Form 10-Q for the quarter ended September 30, 2005 as filed by the Registrant on
November  21,  2005  and is  being  filed  to  amend  and/or  restate  Financial
Statements,  footnotes 2 and 5, and  Management's  Discussion and Analysis.  The
Company is filing this Amended Quarterly Report in response to comments received
from the SEC.

No  attempt  has been  made to this  Form  10-Q/A  to  modify  or  update  other
disclosures presented in the original report on Form 10-Q, except as required to
reflect  the  effects  of the  restatement  of the  Loss for the  quarter  ended
September 30, 2005. The Form 10-Q/A does not reflect events  occurring after the
filing of the Form 10-Q or modify or update those  disclosures.  Information not
affected by the  restatement is unchanged and reflects the  disclosures  made at
the  time of the  original  filing  of the  Form  10-Q  on  November  21,  2005.
Accordingly,  this Form 10-Q/A  should be read in  conjunction  with our filings
made with the Securities and Exchange Commission subsequent to the filing of the
original Form 10-Q including any amendment to those filings.

The following represents the sections amended and the pages where the originally
filed information can be found in the Registrant's Quarterly Report on Form 10-Q
for the quarter ended September 30, 2005.


                                                           Page No. Of Origin-
PART I. FINANCIAL INFORMATION                            ally filed information

  Item 1. Financial Statements:

  Restated Consolidated Balance Sheets
           as of September 30, 2005 and June 30, 2005......................1-2

  Restated Consolidated Statements of Operations
           for the Three Months ended September 30, 2005 and 2004............3

  Restated Consolidated Statement of Stockholders' Equity
           for the Three Months ended September 30, 2005.....................4

  Restated Consolidated Statements of Cash Flows
           for the Three Months ended September 30, 2005 and 2004............5

Notes to Consolidated Financial Statements
  Footnote 2..............................................................8-10
  Footnote 5.............................................................17-19
  Item 2. Management's Discussion and Analysis of
          Financial Condition and Results of Operations..................34-35
          Revised Results of Operations for the quarter ended September 30, 2005
          to reflect changes made to the Amended Consolidated
          Statement of Operations for the quarter ended September 30, 2005


<PAGE>


                    INTERNATIONAL THOROUGHBRED BREEDERS, INC.
                                AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS
                   AS OF SEPTEMBER 30, 2005 AND JUNE 30, 2005

<TABLE>
                                                                          Restated
                                                                         September 30,
                                                                            2005         June 30,
                                                                         (UNAUDITED)        2005
                                                                        ------------   ------------
<CAPTION>
<S>                                                                    <C>           <C>
 CURRENT ASSETS:

          Cash and Cash Equivalents                                    $   2,044,886 $   1,204,384
          Accounts Receivable                                                 53,529     1,879,088
          Prepaid Expenses                                                 1,631,554     1,392,315
          Other Current Assets                                               372,769       443,481
          Assets of Discontinued Operations                                  401,710       401,747
                                                                        -------------  ------------
               TOTAL CURRENT ASSETS                                        4,504,448     5,321,015
                                                                        -------------  ------------


 VESSELS, EQUIPMENT & LIVESTOCK:
          Vessel - Palm Beach Princess - under Capital Lease              17,500,000    17,500,000
          Equipment                                                        3,164,503     3,118,284
          Leasehold Improvements                                           1,170,788       987,267
          Livestock                                                          328,247       328,247
          Vessel Not Placed in Service - Big Easy - under Capital Lease   24,318,989    24,318,989
          Vessel Not Placed in Service - Royal Star                        3,011,292     2,971,141
                                                                        -------------  ------------
                                                                          49,493,819    49,223,928
          LESS: Accumulated Depreciation and Amortization                  3,166,917     2,625,763
                                                                        -------------  ------------

                                                                        -------------  ------------
               TOTAL VESSELS, EQUIPMENT & LIVESTOCK- NET                  46,326,902    46,598,165
                                                                        -------------  ------------



 OTHER ASSETS:
          Notes Receivable                                                14,278,651    14,278,651
          Vessel Deposits - Related Parties                               10,262,758    10,228,758
          Deposits and Other Assets - Related Parties                      4,558,028     4,482,171
          Deposits and Other Assets - Non-Related Parties                  1,001,635     1,435,923
          Spare Parts Inventory                                              999,998     1,018,982
                                                                        -------------  ------------
               TOTAL OTHER ASSETS                                         31,101,070    31,444,485
                                                                        -------------  ------------


                                                                        -------------  ------------
 TOTAL ASSETS                                                          $  81,932,420 $  83,363,665
                                                                        =============  ============

</TABLE>
 See Notes to Consolidated Financial Statements.

                                        1

<PAGE>

                    INTERNATIONAL THOROUGHBRED BREEDERS, INC.
                                AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS
                   AS OF SEPTEMBER 30, 2005 AND JUNE 30, 2005

                      LIABILITIES AND STOCKHOLDERS' EQUITY

<TABLE>
                                                                         Restated
                                                                         September 30,
                                                                            2005         June 30,
                                                                         (UNAUDITED)       2005
                                                                        ------------   -----------
<CAPTION>
<S>                                                                    <C>           <C>
 CURRENT LIABILITIES:
          Accounts Payable                                             $   5,068,244 $   5,505,374
          Accrued Expenses                                                 3,707,751     2,710,584
          Short-Term Debt                                                    935,717     1,090,479
          Vessel Lease Payable - Current Portion                           6,164,293     5,020,136
          Current Advances From Related Parties                            3,276,705     2,983,271
          Deferred Interest - Short-Term                                     504,053       497,685
          Short-Term Debt - Related Parties                                  496,164       196,164
          Liabilities of Discontinued Operations                             403,400       401,000
                                                                        -------------  ------------
               TOTAL CURRENT LIABILITIES                                  20,556,327    18,404,693
                                                                        -------------  ------------

 LONG-TERM LIABILITIES:
          Vessel Lease Payable - Long Term Portion                        27,581,056    29,530,585
          Long-Term Debt - Net of Current Portion                          2,623,611     2,683,432
          Deferred Interest - Long-Term                                    1,370,396     1,501,185
          Long-Term Advances From Related Parties                             77,650        98,099
                                                                        -------------  ------------
               TOTAL LONG-TERM LIABILITIES                                31,652,713    33,813,301
                                                                        -------------  ------------

 DEFERRED INCOME                                                           1,577,304     1,595,220

 COMMITMENTS AND CONTINGENCIES                                                -             -


 STOCKHOLDERS' EQUITY:
          Series A Preferred Stock, $100 Par Value,
             Authorized 500,000 Shares, 362,844
             Issued and Outstanding                                       36,284,375    36,284,375
          Series B Convertible Preferred Stock, $10 Par Value,
             Authorized 500,000 Shares, 197,300
             Issued and Outstanding                                        1,973,000             -
          Common Stock, $2 Par Value, Authorized 25,000,000 Shares,
            Issued, 11,482,564 and Outstanding, 10,567,487                22,965,125    22,965,125
          Capital in Excess of Par                                        20,960,486    20,112,328
          (Deficit) (subsequent to June 30, 1993,
             date of quasi-reorganization)                               (53,578,956)  (49,352,173)
                                                                        -------------  ------------
                                                                          28,604,030    30,009,655
          LESS:
             Treasury Stock, 915,077 Shares                                 (457,538)     (457,538)
             Deferred Compensation, Net                                         (416)       (1,666)
                                                                        -------------  ------------
               TOTAL STOCKHOLDERS' EQUITY                                 28,146,076    29,550,451
                                                                        -------------  ------------


 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                            $  81,932,420 $  83,363,665
                                                                        =============  ============

</TABLE>
 See Notes to Consolidated Financial Statements.

                                        2
<PAGE>


                    INTERNATIONAL THOROUGHBRED BREEDERS, INC.
                                AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS
             FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
                                   (UNAUDITED)

<TABLE>

                                                                                 Restated
                                                                        ---------------------------
                                                                         September 30,  September 30,
                                                                            2005          2004
                                                                        -------------  ------------
<CAPTION>
<S>                                                                    <C>            <C>
 OPERATING REVENUES:

          Gaming                                                       $   6,232,595  $  5,329,507
          Fare                                                               627,080       540,665
          On Board                                                           467,529       411,328
          Other                                                               63,863        96,822
                                                                        -------------  ------------
          NET OPERATING REVENUES                                           7,391,067     6,378,322
                                                                        -------------  ------------


 OPERATING COSTS AND EXPENSES:
          Gaming                                                           2,142,029     2,114,088
          Fare                                                               975,632       960,198
          On Board                                                           218,295       211,113
          Maritime & Legal Expenses                                        1,846,962     1,467,781
          General & Administrative Expenses                                  611,824     1,004,193
          General & Administrative Expenses - Parent                         573,730       427,583
          Ship Development Costs - Big Easy                                2,332,773             -
          Ship Development Costs - Royal Star                                350,569             -
          Equine Costs                                                       241,504             -
          Development Costs - Other                                          274,019       524,814
          Depreciation & Amortization                                        657,198       398,879
          Loss on Impairment of Note Receivable                                    -       200,000
                                                                        -------------  ------------
          TOTAL OPERATING COSTS AND EXPENSES                              10,224,535     7,308,649
                                                                        -------------  ------------


 OPERATING INCOME (LOSS)                                                  (2,833,468)     (930,327)
                                                                        -------------  ------------


 OTHER INCOME (EXPENSE):
          Interest and Financing Expenses                                 (1,321,432)   (1,011,600)
          Interest and Financing Expenses - Related Party                   (151,438)     (155,991)
          Interest Income                                                     13,667        74,343
          Interest Income Related Parties                                     64,541         3,974
          Other Income                                                         8,347           241
                                                                        -------------  ------------
          TOTAL OTHER INCOME (EXPENSE)                                    (1,386,315)   (1,089,033)
                                                                        -------------  ------------


 INCOME (LOSS) BEFORE TAX PROVISION
 AND EXTRAORDINARY ITEM                                                   (4,219,783)   (2,019,360)
           Income Tax Expense (Benefit)                                        7,000       (42,000)
                                                                        -------------  ------------


 INCOME (LOSS) BEFORE EXTRAORDINARY ITEM                                  (4,226,783)   (1,977,360)

 EXTRAORDINARY ITEM -  Fees charged to related
          parties for Master Settlement Agreement ( Note 13).                      -     3,560,000
                                                                        -------------  ------------


 NET INCOME (LOSS)                                                     $  (4,226,783) $  1,582,640
                                                                        =============  ============


 INCOME (LOSS) PER COMMON SHARE:
          Basic:
          Income (Loss) before Extroardinary Item                      $       (0.40) $      (0.20)
          Extraordinary Item                                                       -          0.37
                                                                        -------------  ------------
          Net Income (Loss)                                            $       (0.40) $       0.16
                                                                        =============  ============
          Diluted:
          Income (Loss) before Extroardinary Item                      $       (0.40) $      (0.19)
          Extraordinary Item                                                       -          0.35
                                                                        -------------  ------------
          Net Income (Loss)                                            $       (0.40) $       0.15
                                                                        =============  ============

 WEIGHTED AVERAGE COMMON
    SHARES OUTSTANDING - Basic                                            10,567,487     9,718,796
                                                                        =============  ============

 WEIGHTED AVERAGE COMMON
    SHARES OUTSTANDING - Diluted                                          10,567,487    10,258,358
                                                                        =============  ============

</TABLE>
See Notes to Consolidated Financial Statements.

                                        3
<PAGE>

                    INTERNATIONAL THOROUGHBRED BREEDERS, INC.
                                AND SUBSIDIARIES

             RESTATED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                  FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2005
                                   (UNAUDITED)

<TABLE>
                                                  Series A            Series B Convertible
                                                 Preferred               Preferred                 Common
                                            ----------------------   --------------------- -------------------------
                                            Number of                Number of              Number of
                                            Shares      Amount       Shares     Amount      Shares         Amount
                                            -------   ------------    -------  ----------- ---------    ------------
<CAPTION>
<S>                                         <C>       <C>                      <C>         <C>          <C>
BALANCE - JUNE 30, 2005                     362,844   $ 36,284,375       -     $       -   11,482,564   $ 22,965,125

   Series B Convertible Preferred
      Shares Issued                                                   197,300    1,973,000
   Compensation for Options Granted
      to Non-Employees
   Beneficial Conversion Feature of
      Convertible Preferred Stock
   Amortization of Deferred Compensation Costs    -             -          -            -          -              -
   Net (Loss) for the Three Months Ended
      September 30, 2005 -  as Restated           -             -          -            -          -              -

                                            -------   ------------    -------  ----------- ---------    ------------
BALANCE - SEPTEMBER 30, 2005                362,844   $ 36,284,375    197,300  $ 1,973,000 11,482,56    $ 22,965,125
                                            =======   ============    =======  =========== =========    ============
</TABLE>


<TABLE>
                                            Capital                        Treasury    Deferred
                                            in Excess                      Stock       Compen-
                                            of Par          (Deficit)      At Cost     sation       Total
                                           ------------   -------------   ----------   --------   -------------
<CAPTION>
<S>                                        <C>            <C>             <C>          <C>        <C>
BALANCE - JUNE 30, 2005                    $ 20,112,328   $ (49,352,173)  $ (457,538)  $ (1,666)  $  29,550,451

   Series B Convertible Preferred
      Shares Issued                             656,915                                               2,629,915
   Compensation for Options Granted
      to Non-Employees                          130,843                                                 130,843
   Beneficial Conversion Feature of
      Convertible Preferred Stock                60,400                                                  60,400
   Amortization of Deferred Compensation Costs       -               -            -       1,250           1,250
   Net (Loss) for the Three Months Ended
      September 30, 2005 -  as Restated              -       (4,226,783)          -          -       (4,226,783)

                                           ------------   -------------   ----------   --------   -------------
BALANCE - SEPTEMBER 30, 2005               $ 20,960,486   $ (53,578,956   $ (457,538)  $   (416)  $  28,146,076
                                           ============   =============   ==========   ========   =============
</TABLE>

    See Notes to Consolidated Financial Statements.

                                       4

<PAGE>

                    INTERNATIONAL THOROUGHBRED BREEDERS, INC.
                                AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
             FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
                                   (UNAUDITED)
<TABLE>
                                                                                  Restated
                                                                                 September 30, September 30,
                                                                                -------------  ------------
                                                                                    2005          2004
                                                                                -------------  ------------
<CAPTION>
<S>                                                                            <C>            <C>
 CASH FLOWS FROM OPERATING ACTIVITIES:
      INCOME (LOSS) BEFORE DISCONTINUED OPERATIONS                             $  (4,226,783) $  1,582,640
       Adjustments to reconcile income (loss) to net cash (used in)
        provided by operating activities:
       Depreciation and Amortization                                                 657,198       398,879
       Compensation for Options Granted                                              191,243             -
       Impairment of Note                                                                  -       200,000
       Increase in Deferred Income                                                   (17,916)      190,863
       (Decrease) in Deferred Income - Related Parties                                     -    (4,000,000)
       Changes in Operating Assets and Liabilities -
          Decrease in Accounts Receivable ($1.3 million received from PDS)         1,825,554         4,596
          (Increase) Decrease in Other Assets                                         70,712       (14,278)
          (Increase) in Prepaid Expenses                                            (239,239)     (259,740)
          Increase in Accounts Payable and Accrued Expenses                          508,586       298,865
                                                                                -------------  ------------
      CASH (USED IN) OPERATING ACTIVITIES BEFORE
        DISCONTINUED OPERATIONS                                                   (1,230,645)   (1,598,175)
      CASH PROVIDED BY DISCONTINUED OPERATING ACTIVITIES                               2,400         2,400
                                                                                -------------  ------------
      NET CASH (USED IN) OPERATING ACTIVITIES                                     (1,228,245)   (1,595,775)
                                                                                -------------  ------------

 CASH FLOWS FROM INVESTING ACTIVITIES:
     Purchase and Improvements of Big Easy - Related Party                                 -    (3,701,297)
     Purchase and Improvements of Royal Star                                         (40,151)     (771,196)
     Note Receivable Collected - Related Party                                             -     2,600,748
     Advances Collected -  Related Party                                                   -       921,789
     Livestock Expenditures                                                                -      (275,971)
     Capital Expenditures                                                           (229,031)     (295,313)
     (Increase) Decrease in Other Investment Activity                                 24,276       (64,911)
          NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES                       (244,907)   (1,586,151)

 CASH FLOWS FROM FINANCING ACTIVITIES:
     Proceeds from Sale of Series B Preferred Stock                                2,959,500             -
     Fees Paid on Sale of Series B Preferred Stock                                  (244,500)            -
     Advances Received from Related Parties                                          100,073             -
     Principal Payments on Short Term Notes                                          (11,026)       (6,029)
     Principal Payments on Long Term Notes                                          (490,432)            -
     Principal Payments on Long Term Debt - Related Parties                                -      (313,195)
     Decrease in Balances Due to/From Discontinued Subsidiaries                        2,438         1,687
                                                                                -------------  ------------
          CASH (USED IN) FINANCING ACTIVITIES
            BEFORE DISCONTINUED FINANCING ACTIVITIES                               2,316,054      (317,537)
          CASH (USED IN) DISCONTINUED FINANCING ACTIVITIES                            (2,438)       (1,687)
                                                                                -------------  ------------
          NET CASH (USED IN) FINANCING ACTIVITIES                                  2,313,616      (319,224)
                                                                                -------------  ------------

 NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                840,464    (3,501,150)
           LESS CASH AND CASH EQUIVALENTS  FROM
             DISCONTINUED OPERATIONS                                                      38          (713)
          CASH AND CASH EQUIVALENTS AT BEGINNING OF THE PERIOD                     1,204,384     7,508,632
                                                                                -------------  ------------

          CASH AND CASH EQUIVALENTS AT END OF THE PERIOD                       $   2,044,886  $  4,006,769
                                                                                =============  ============

          Supplemental Disclosures of Cash Flow Information:
          Cash paid during the period for:
          Interest                                                             $   1,434,991  $    654,862
          Income Taxes                                                         $           -  $          -

</TABLE>

 See Notes to Consolidated Financial Statements.

                                       5
<PAGE>

                                   FORM 10-Q/A
                                 AMENDMENT NO. 1
                          QUARTERLY REPORT ON FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2005


(2) UNREGISTERED SALES OF EQUITY SECURITIES

     On July 13, 2005 the Company began accepting subscriptions for the purchase
of shares of the  Company's  Series B  Convertible  Preferred  Stock,  par value
$10.00 per share (the "Series B Preferred Stock").  The subscriptions for Series
B  Preferred  Stock  have  been  received  by the  Company  as part of a private
offering  of up to  500,000  shares  of  its  Series  B  Preferred  Stock,  at a
subscription price of $15.00 per share ($7.5 million,  in the aggregate,  if all
500,000 shares of Series B Preferred Stock are sold in the offering).  Under the
Subscription  Agreement,  each such subscriber  will be entitled to receive,  in
addition  to shares of Series B  Preferred  Stock at $15.00 per  share,  a stock
purchase  warrant for the purchase of 1.2 shares of the  Company's  common stock
for each  share of  Series B  Preferred  Stock  purchased.  Accordingly,  if all
500,000  shares of Series B  Preferred  Stock are  subscribed  for,  warrants to
purchase an aggregate of 600,000 shares of the Company's common stock would then
be issuable. The exercise price under each such warrant will be $3.25 per common
share,  and the warrants  issued to purchasers  of the Series B Preferred  Stock
will be  exercisable  for a term of three (3)  years  beginning  one year  after
issuance.  As of September 30, 2005 the Company has accepted  subscriptions  for
the  purchase  of 197,300  shares of Series B Preferred  Stock and has  received
approximately $2.7 million in net proceeds.

     The Series B Preferred Stock has been established by the Board of Directors
pursuant to its authority under the Company's  Certificate of  Incorporation  to
fix the relative rights and preferences of the authorized but unissued preferred
stock of the Company. Upon accepting subscriptions for purchases of the Series B
Preferred  Stock,  the Company has entered into a Registration  Rights Agreement
with the  purchasers,  pursuant  to  which  the  Company  has  agreed  to file a
Registration Statement under the Securities Act of 1933, as amended, in order to
register the resale of the shares of common stock of the Company  issuable  upon
conversion  of the  Series B  Preferred  Stock and the  shares  of common  stock
issuable upon exercise of the accompanying stock purchase  warrants,  and to use
its best efforts to cause such Registration Statement to be declared effective.

     The Series B Preferred  Stock will  automatically  be converted into common
stock upon the effective date of the Registration  Statement covering the common
shares issuable upon conversion. The initial conversion price is $2.00 per share
of common stock,  declining by $.02 for each full calendar quarter elapsing from
July 1, 2005 to the date on which the conversion  shall occur.  Upon conversion,
each share of Series B Preferred Stock will be converted into a number of shares
of common stock determined by dividing the subscription price, $15.00 per share,
by the conversion price then in effect.  Based upon the initial conversion price
of $2.00  and the  subscription  price of  $15.00  for  each  share of  Series B
Preferred Stock, the number of common shares initially  issuable upon conversion
is 7.5 shares of common stock for each share of Series B Preferred  Stock, or up
to  3,750,000  additional  new  common  shares if the Series B  Preferred  Stock
offering is fully subscribed.

     During the  quarter  our net loss was  increased  by a non-cash  expense of
$60,400 as the  result of the  accounting  for the sale of Series B  convertible
preferred stock. This non-cash item, known as a "Beneficial Conversion Feature",
is the result of the  application  of the Emerging  Issues Task  Force's  (EITF)
Issues 98-5 and 00-27. The beneficial  conversion  feature was calculated as the
difference  between  the  effective  conversion  price and the fair value of the
common stock, multiplied by the estimated number of common shares into which the
security is  convertible.  The number of common  shares the  Preferred  Stock is
convertible  into has been  estimated,  assuming a  conversion  before March 31,
2006,  at a price of $1.96 per share.  Upon  conversion,  each share of Series B
Preferred  Stock  will be  converted  into a number of  shares  of common  stock
determined by dividing the subscription price of $15 per share by the conversion
price then in effect.  We have  estimated  that as of March 31,  2006 a total of
3,826,530  shares of Common  Stock  would be issued upon  conversion  of all the
Series B Preferred Stock, which represents an additional 76,530 shares

                                        6

<PAGE>


                                   FORM 10-Q/A
                                 AMENDMENT NO. 1
                          QUARTERLY REPORT ON FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2005

above the  original  number  had the price been $2.  The value  assigned  to the
beneficial  conversion  feature on the  Preferred  Stock was credited to paid in
capital and charged to earnings as interest  expense for those  Preferred  Stock
securities sold during the quarter.


     The stock  purchase  warrants  to be issued to  purchasers  of the Series B
Preferred Stock may be exercised, beginning one year after issuance, at any time
over the next three years,  at an exercise  price of $3.25 per share  payable at
the time of exercise.  In lieu of paying the exercise price,  the holder has the
right to effectuate a cashless  exercise in which the Company would issue to the
holder a number  of  shares  of common  stock  computed  by using the  following
formula: X=Y (A-B)/A,  where X equals the number of shares of common stock to be
issued to the  holder;  Y equals the number of shares of common  stock for which
the warrant is being exercised; A equals the market price of one share of common
stock;  and B equals the warrant  exercise  price.  As a result,  the holder may
receive a number of  shares  representing  the  unrealized  appreciation  in the
warrant.

     Pursuant to the Subscription Agreement, the Company also agreed to increase
the size of its Board of Directors from four to seven  members,  and to fill two
of those  vacancies  with one person to be  designated  by MBC  Global,  LLC, an
Illinois  limited  liability  company which introduced some of the purchasers of
the  Series  B  Preferred  Stock  to the  Company,  and a  second  person  to be
designated by another group of purchasers of the Series B Preferred Stock. As of
the date  hereof,  the  Company  has  increased  the size of its  Board to seven
members and expects to fill the vacancies thereby created in due course.

     The  Company  will pay a finder's  fee of 5% of the  purchase  price of the
Series B Preferred Stock (in addition to fees payable to MBC Global as described
below).  Accordingly,  if all  500,000  shares of the Series B  Preferred  Stock
offered are purchased in the private offering,  generating $7.5 million of gross
proceeds,  a finder's fee of $375,000 would be payable. The Company plans to use
the net  proceeds  of the sale of Series B  Preferred  Stock for parent  company
operating  expenses  and for  working  capital  of the  parent  company  and its
subsidiaries, including our ITG Vegas subsidiary.

     Also on July 13, 2005, the Company entered into an Advisory Agreement dated
as of June 30, 2005,  and an amendment  thereto dated as of July 12, 2005,  with
MBC Global,  LLC,  pursuant to which the Company  retained  the  services of MBC
Global as financial advisor on a non-exclusive basis. The Advisory Agreement has
a minimum  term of two (2) years,  and  requires the Company to pay a consulting
fee of $10,000 per month to MBC Global,  a merger and  acquisition  fee of 2% of
the purchase  price upon closing of a merger or acquisition  transaction  with a
target introduced by MBC Global, and an advisory fee upon closing of a financing
transaction  with a source  introduced  by MBC  Global  equal to 7% of the gross
proceeds in the case of an equity  transaction,  3% of the gross proceeds in the
case of any  mezzanine  debt,  and 1% of the gross  proceeds  in the case of any
senior debt. MBC Global agreed to reduce its compensation in connection with the
sale of our Series B Preferred  Stock to 5% of the gross  proceeds of such sales
to investors introduced by MBC Global.

     As additional compensation to MBC Global, the Company agreed to issue three
(3) stock purchase warrants to MBC Global, one for the purchase of up to 150,000
shares of the Company's  common stock at $2.50 per share,  a second  warrant for
the purchase of up to 100,000 shares of the Company's  common stock at $3.50 per
share,  and a third  warrant  for the  purchase of up to an  additional  150,000
shares of the  Company's  common stock at $4.50 per share.  The actual number of
common shares purchasable under each of these warrants will be determined by the
number of shares of Series B Preferred Stock, described above, subscribed for in
the Company's  private offering by July 22, 2005 (or by such later date to which
the Company may extend its private  offering of Series B Preferred  Stock).  All
three stock purchase  warrants will have a term of four (4) years. In connection
with the  Advisory  Agreement  and such  warrants,  the Company  entered  into a
Registration Rights Agreement with MBC Global pursuant

                                        7

<PAGE>


                                   FORM 10-Q/A
                                 AMENDMENT NO. 1
                          QUARTERLY REPORT ON FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2005

to which the  Company  has  agreed to file a  Registration  Statement  under the
Securities  Act of 1933,  as  amended,  covering  the resale of shares of common
stock purchasable under such MBC Global warrants, and to use its best efforts to
cause such Registration Statement to be declared effective.

(5) NOTES RECEIVABLE

     Second Cherry Hill Note

     A portion  of the  proceeds  from the sale of the  non-operating  former El
Rancho  Hotel and  Casino in Las Vegas to  Turnberry/Las  Vegas  Boulevard,  LLC
("Turnberry")  on May 22, 2000 was used by us to purchase a  promissory  note of
the buyer in the face amount of $23,000,000 (the "Las Vegas Note"). The interest
rate under  such note was to be  adjusted  from time to time since the  interest
actually  payable  was to be  dependent  upon,  and  payable  solely out of, the
buyer's  net  cash  flow  available  for   distribution  to  its  equity  owners
("Distributable  Cash").  After the equity  investors  in the buyer had received
total  distributions  equal to their capital  contributions  plus an agreed upon
return on their invested capital, the next $23 million of Distributable Cash was
to be paid to us. We were to receive payments under the note equal to 33 1/3% of
all  Distributable  Cash until the maturity date, which was to occur on the 30th
anniversary  of our  purchase  of the note.  We had the  option to  convert  the
promissory  note into a 33 1/3% equity  interest in the buyer during a six month
period  beginning at the 15th  anniversary  of the issuance of the note.  If not
then  converted,  the note was to be converted into a 33 1/3% equity interest in
the  buyer  at the  30th  anniversary  of  its  issuance.  Fair  value  and  the
collectability of this note were determined by a real estate appraisal completed
in July, 2003 for a bank in anticipation of financing for Turnberry.

     On June 16, 2004,  the Company sold the Las Vegas Note to Cherry Hill at El
Rancho LP (the  "Buyer"),  a limited  partnership  which is affiliated  with the
maker of the Las Vegas Note.

     In exchange for the Las Vegas Note, the Company received cash payments from
the Buyer of $2.8 million, a non-recourse loan from Turnberry Development,  LLC,
an  affiliate of the Buyer,  in the amount of $5 million and a  promissory  note
issued by Soffer/Cherry  Hill Partners,  L.P. ("Cherry Hill Partners"),  another
affiliate of the Buyer,  in the  principal  amount of  $35,842,027  (the "Second
Cherry Hill Note").  The principal  amount of the Second Cherry Hill Note equals
the difference between the unpaid principal plus all accrued and unpaid interest
(at 22%)  under the Las Vegas  Note,  less the $2.8  million in  purchase  price
payments  and $5  million  non-recourse  loan paid to the  Company.  As  further
consideration, the Company received the right to use aircraft owned or leased by
the  Buyer or its  affiliates,  for up to 64 hours in total,  which the  Company
valued at approximately $224,000.

         The Company is not liable for repayment of the principal of the $5
million loan included in the foregoing consideration. However, the Company is
obligated to pay interest and fees on such loan aggregating $600,000 per year
($50,000 per month) for five (5) years.

         The Second Cherry Hill Note received by the Company matures in 2015 and
is similar to the Las Vegas Note which was sold, in that it generally is payable
prior to maturity only from distributable cash of the maker. The maker under the
Second Cherry Hill Note is one of the principal partners in the entity which
purchased the Garden State Park real property from a Company subsidiary in
November of 2000, and such obligor will only have funds with which to pay the
Second Cherry Hill Note out of its profits from the development of Garden State
Park. The development of Garden State Park, located in Cherry Hill, New Jersey,
was delayed as a result of community opposition to certain elements of the
development plan, and, while the Company believes that the development plan is
now moving forward, the timing and amount of profits there also remain
uncertain. The Company already holds a promissory note in the face amount of $10
million, received from the purchaser of

                                        8

<PAGE>


                                   FORM 10-Q/A
                                 AMENDMENT NO. 1
                          QUARTERLY REPORT ON FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2005

Garden State Park in connection  with the sale of such real property,  which the
Company expects will be fully paid in time.  While the Company expects that note
to be fully paid, it is not optimistic that this Second Cherry Hill Note will be
fully paid, and accordingly, the Company has written down the Second Cherry Hill
Note (defined  above) on its books.  The interest  portion of the Las Vegas Note
amounting to approximately  $20,866,000 has never been included as income on the
Company's books, therefore the interest capitalized under the Second Cherry Hill
Note is not subject to a write down. The remaining  portion of the Second Cherry
Hill Note has been written down to  $4,278,651  which  resulted in an impairment
charge of the new note of  $12,786,589,  recorded  in the fourth  quarter of the
Company's  June 30,  2004  fiscal  year and  additional  impairment  charges  of
$500,000 in Fiscal 2005. The Company had previously  recorded deferred income of
$2,786,589 on the original sale of the El Rancho  property in May,  2000,  which
amount was used to reduce the impairment charge to $10,000,000 at June 30, 2004.
In addition,  if before July 31, 2005,  there is a sale or other  disposition of
the El Rancho Property,  or a sale or other  disposition of the entire direct or
indirect interest of the owner of such property, then fifty percent (50%) of any
profit in excess of $10  million  realized on such sale also shall be paid to us
as a mandatory  prepayment  of the Second  Cherry  Hill Note.  The July 31, 2005
deadline by which a sale of the El Rancho  Property would have to occur in order
to trigger a possible  prepayment to the Company will be extended to January 31,
2006 if a  portion,  but less than  all,  of the El  Rancho  Property  or if the
Owner's direct or indirect  ownership  interest is sold before July 31, 2005. In
its  assessment  of the fair value of the Second  Cherry Hill Note,  the Company
estimated  that its share of  proceeds  from the sale of the El Rancho  property
prior to July 31, 2005 would  generate  approximately  $500,000.  As of June 30,
2005 the Company recorded an additional impairment loss on this note of $500,000
because a sale did not occur prior to July 31, 2005.

     The  Second  Cherry  Hill Note is  secured  by a pledge  of stock  owned by
Raymond  Parello,  an  affiliate  of the  Buyer,  in Palm Beach  Empress,  Inc.,
representing  fifty  percent  (50%) of the  stock in that  company.  Palm  Beach
Empress,  Inc. is the entity  formed to acquire the Big Easy,  the second vessel
which is chartered to a subsidiary of the Company, and which the Company expects
to operate as a casino  cruise  ship,  similar  to the  operation  of the casino
"cruise to nowhere"  business  conducted  by a subsidiary  of the Company  since
April of 2001. The other fifty percent (50%) of the stock in Palm Beach Empress,
Inc. is owned by PBMC, a corporation  owned by Francis W. Murray,  the Company's
Chief Executive Officer. PBMC presently owns and charters to a subsidiary of the
Company the Palm Beach Princess vessel,  the operation of which is the Company's
primary operating business.

     Mr. Parello will have the right to acquire the Second Cherry Hill Note from
the Company in exchange  for his stock in Palm Beach  Empress,  Inc.  Such "put"
option held by Mr. Parello  (giving him the right to put his stock in Palm Beach
Empress,  Inc.  to the  Company  in  exchange  for the  Cherry  Hill  Note) will
effectively limit the value to the Company of the Second Cherry Hill Note to the
value of Mr.  Parello's  one-half  interest  in Palm  Beach  Empress,  Inc.  Mr.
Parello's "put" right will be exercisable upon the later to occur of (1) payment
by or for the account of Cherry Hill  Partners of  $483,205.48  under the Second
Cherry  Hill  Note,  and (2)  payment  of the  entire  principal  balance of the
non-recourse loan received by our Orion subsidiary in the principal amount of $5
million, referred to above (upon which repayment the Company's obligation to pay
interest  and fees of  $600,000  per year on such loan  would  end).  Such "put"
option is set forth in the  Shareholders'  Agreement  among Palm Beach  Empress,
Inc.,  Raymond Parello and PBMC, to which our Orion subsidiary has joined solely
for the purpose of confirming its agreement to the "put" option.

     In the event Mr. Parello receives any dividends or other  distributions on,
or proceeds from, any sale of, his shares in Palm Beach Empress,  Inc., the same
will be applied as a mandatory prepayment of the Second Cherry Hill Note.


                                        9

<PAGE>


                                   FORM 10-Q/A
                                 AMENDMENT NO. 1
                          QUARTERLY REPORT ON FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2005

     The fair  value of the Second  Cherry  Hill Note was  determined  using the
present value of the additional benefits derived from the sale of the note after
the cash proceeds of $7.8 million.


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS
OF OPERATIONS


Critical Accounting Policies and Estimates

     Financial  Reporting  Release No. 60 requires  all  companies  to include a
discussion of critical  accounting policies or methods and estimates used in the
preparation  of  financial  statements.  We prepare our  Consolidated  Financial
Statements in conformity with accounting  principles  generally  accepted in the
United States. Certain of our accounting policies, including the estimated lives
assigned to our assets, asset impairment,  and the calculation of our income tax
liabilities,  require  that  we  apply  significant  judgment  in  defining  the
appropriate  assumptions for calculating  financial estimates.  By their nature,
these judgments are subject to an inherent degree of uncertainty.  Our judgments
are  based on our  historical  experience,  terms  of  existing  contracts,  our
observance  of trends in the  industry  and  information  available  from  other
outside sources,  as appropriate.  There can be no assurance that actual results
will  not  differ  from  our  estimates.  Note 1 to the  Consolidated  Financial
Statements  describes the significant  accounting  policies we have selected for
use in the preparation of our financial statements and related  disclosures.  We
believe  the  following  to  be  the  most  critical  accounting  estimates  and
assumptions affecting our reported amounts and related disclosures.

     Notes Receivable

     Statement  of  Financial  Accounting  Standards  No.  114,  "Accounting  by
Creditors for Impairment of a Loan" as amended,  requires  management  judgments
regarding the future  collectability of notes receivable and the underlying fair
market  value of  collateral.  As a result of the sale of the Garden  State Park
Racetrack property in Cherry Hill, NJ, and the sale of the non-operating  former
El Rancho Hotel and Casino in Las Vegas,  NV, portions of the proceeds from each
sale were paid in the form of  promissory  notes.  During the fiscal  year ended
June 30, 2004 we sold the note  receivable we held on the Las Vegas, NV property
for cash and other future  benefits and  transferred the balance of the note to,
and it is now  secured by, the Cherry  Hill,  NJ  property  (Second  Cherry Hill
Note). We had previously  received a note receivable from the sale of the Garden
State Park property in the amount of $10 million and  together,  these notes are
classified on the Balance Sheet as Long Term Notes  Receivables in the amount of
$14,278,651 as of June 30, 2005. Estimates are required to be used by management
to assess the  recoverability of our notes  receivable.  We regularly review our
receivables  to determine if there has been any decline in value.  These reviews
require management judgments that often include estimating the outcome of future
events and  determining  whether  factors  exist that  indicate  impairment  has
occurred.  We evaluate real estate appraisals,  financial balance sheets for the
Cherry  Hill  development,  earnings  and  cash  forecasts  of the  Cherry  Hill
investors.  Our returns on the Cherry Hill Notes are subject to debt incurred by
the property and the developers capital contributions that precede the debt owed
to us. Our returns are also subject to factors  affecting the  profitability and
saleability  of the project.  Our  assumptions,  estimates and  evaluations  are
subject to the  availability of reliable data and the uncertainty of predictions
concerning  future events.  Accordingly,  estimates of  recoverable  amounts and
future cash flows are subjective and may not ultimately be achieved.  Should the
underlying  circumstances  change, the estimated  recoverable amounts and future
cash flows could change by a material amount.


                                       10

<PAGE>


                                   FORM 10-Q/A
                                 AMENDMENT NO. 1
                          QUARTERLY REPORT ON FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2005

     When making our impairment  review for the year ended June 30, 2004 for the
Note  Receivable on the Las Vegas  property we determined  that a portion of the
Second  Cherry  Hill  Note  should  be  impaired  by  $12,786,589  (or a net  of
$10,000,000  when offset by  $2,786,589  of deferred gain on the sale of the Las
Vegas property) based on the  collectability  of the note when assigned from the
Las Vegas  property to the Cherry Hill property  since we already held a note in
the amount of $10,000,000 on that same  property.  Additionally  during the year
ended June 30, 2005 an additional  impairment charge of $500,000 was recorded on
the Second Cherry Hill Note because projected future events did not materialize.

         Valuation of Vessels and Vessel Deposits - Related Parties

     In July, 2004 we entered into  Sub-Bareboat  Charters of the vessels,  Palm
Beach  Princess and Big Easy and pursuant to a  restructuring  of the PDS Gaming
transaction in June, 2005, we now charter the vessels directly from our Chairman
and CEO. The charter and PDS Gaming loan  agreement for the Palm Beach  Princess
has been  accounted  for as a capital  lease.  In  according  with our lease and
purchase agreement for the Palm Beach Princess we have the right to purchase the
vessel for $17,500,000 at the end of the lease term. Payments made by us against
the PDS Gaming debt in the amount of  $14,000,000  will be  credited  toward the
purchase price.  The carrying value of the Palm Beach Princess of $17,500,000 is
less than the fair value  appraisal  on the  vessel.  The charter and PDS Gaming
loan  agreement for the Big Easy has also been accounted for as a capital lease.
In accordance with our lease and purchase agreement for the Big Easy we have the
right to purchase the Big Easy for the appraised value of the vessel which would
be determined upon the refitting and refurbishing of the vessel. The Company had
an appraisal  completed  as of June 23, 2005 and it indicated an estimated  fair
market  value of  approximately  $40  million.  Based on a July 2002 fair market
appraisal of the Palm Beach Princess of $20.5 million,  management  believed the
appraisal of the Big Easy could be  overstated  and looked for  alternatives  to
determine the capitalized fair value for the vessel. The Company determined that
it would capitalize 1) costs it had incurred for improvements it had made to the
Big Easy; 2) all payments  required  under the PDS Gaming loans for the Big Easy
of $12.6 million;  and 3) all payments required under the charter hire fees, for
a total capitalized  amount as of June 30, 2005 of $24,318,989.  The Company has
Vessel Deposit  credits in the amount of $10,228,758  which are available to use
against the  purchase  costs for the  vessels.  Should the Company  elect not to
purchase one or either  vessel at the end of the lease,  the Company  could lose
some or all of the value of the Vessel  Deposit  credits  unless other terms are
negotiated with the owner of the vessels."


     Results of  Operations  for the Three Months Ended  September  30, 2005 and
2004

     Consolidated

     Revenue for the three  months  ended  September  30,  2005,  (fiscal  2006)
increased $1,012,745 from $6,378,322 in Fiscal 2005 to $7,391,067 in Fiscal 2006
primarily  as a result of  increase  in  revenues  generated  by the Palm  Beach
Princess operations during the comparable periods.  Operating expenses increased
$2,915,886  from  $7,308,649  in the  three  month  period  in  Fiscal  2005  to
$10,224,535 in Fiscal 2006 primarily the result of : 1) recording start up costs
for the Big Easy of $2,332,773 compared to last year when no start up costs were
recorded;  and  carrying  costs on the Royal Star of  $350,569;  2)  expenses of
$241,504  incurred  as a result of our entry  into the  equine  business;  3) an
increase  in  depreciation   and   amortization  of  $258,319  as  a  result  of
depreciation  being  recorded on the Palm Beach  Princess as a result of capital
leasing arrangements effective in July, 2004 and amortization of finance fees as
a result of the PDS  transactions;  4) an  increase  in the Palm Beach  Princess
operating  expenses,  before depreciation and interest expense of $37,369 due to
an increase in revenues and the increased  number of cruises as compared to last
year, offset by a decrease in other development costs of $250,795 as compared to
last year when the Company had more funds to actively search,  both domestically
and

                                       11

<PAGE>


                                   FORM 10-Q/A
                                 AMENDMENT NO. 1
                          QUARTERLY REPORT ON FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2005

internationally  for  additional  gaming  opportunities,  and a decrease  in the
impairment  on a Note  Receivable  of $200,000  which  reflects  the  impairment
recognized in Fiscal 2005.

     The  operating  (loss)  for  the  quarter  ended  September  30,  2005  was
($2,833,468)  as  compared  to  an  operating   (loss)  of  ($930,327)  for  the
comparative  quarter, an increase in loss of ($1,903,141) for the reasons stated
above.

     Other net expenses increased by $297,282 due to the additional interest and
financing  expense  of  $305,279  paid to PDS on the  additional  borrowings  we
received  from PDS  during  the last  fiscal  year and the 1)  expensing  of the
Beneficial  Conversion  Feature in the amount of $60,400 in connection  with the
sale of 197,300 shares of Series B Convertible Preferred Stock; 2) expensing the
400,000 options granted at various prices to our financial advisor in the amount
of $86,590  which  contract  was  effective  on July 1, 2005;  3) the  expensing
$44,250  due to the 236,760  warrants  issued to the  purchaser  of our Series B
Preferred  Stock as of September  30,  2005.  We began the quarter with note and
capital lease  borrowings  from PDS in the  approximate  amount of  $29,314,000,
compared  to the  first  quarter  of  last  fiscal  year  when  the  outstanding
borrowings from PDS were $27 million.  The net (loss) before  extraordinary item
for the  quarter  ended  September  30,  2005 was a (loss)  of  ($4,226,783)  as
compared to a (loss) of ($1,977,360) during the comparative quarter.

     The Net (loss) for the quarter ended September 30, 2005 was ($4,226,783) or
a (loss) of ($.40) per diluted  share as compared  to income of  $1,582,640,  or
($15) per diluted  share for the quarter ended  September  30, 2004.  During the
first quarter of the 2005 Fiscal year the Company recorded extraordinary income,
net of tax, of $3,560,00 as compared to this year when no  extraordinary  income
was recorded.

     For the quarter ended September 30, 2005 earnings before  interest,  taxes,
depreciation and  amortization  and our unusual items of  extraordinary  income,
impairment  losses and vessel  start up costs  (Adjusted  EBITDA) was $51,849 as
compared to a (loss) of ($331,207) for the quarter ended September 30, 2004. The
increase in Adjusted  EBITDA of $383,056 was  primarily due to EBITDA levels for
the Palm Beach Princess increasing from approximately $970,000 in Fiscal 2005 to
approximately  $1.6 million in Fiscal 2006. In the quarter  ended  September 30,
2004,  adjusted  EBITDA  levels  were  negatively  affected  by  the  hurricanes
experienced during that quarter.

Reconciliation of Non-GAAP Measures to GAAP

     Adjusted  EBITDA or  earnings  before  interest,  taxes,  depreciation  and
amortization  and unusual  items is not a measure of  performance  or  liquidity
calculated in accordance with generally accepted accounting  principles.  EBITDA
information  is  presented  as  a  supplemental  disclosure  because  management
believes  that it is a widely  used  measure of such  performance  in the gaming
industry. In addition, management uses Adjusted EBITDA as the primary measure of
the  operating  performance  of its  operations,  including  the  evaluation  of
management personnel.  Adjusted EBITDA should not be construed as an alternative
to operating income, as an indicator of the Company's operating performance,  or
as an  alternative  to cash flows  from  operating  activities,  as a measure of
liquidity,  or as any other measure of performance determined in accordance with
generally accepted  accounting  principles.  The Company has significant uses of
cash flows, including capital expenditures,  interest payments, taxes, lease and
debt principal repayments, which are not reflected in Adjusted EBITDA. It should
also be noted that other gaming  companies  that report EBITDA  information  may
calculate EBITDA in a different manner than the Company. A reconciliation of the
Company's  Adjusted  EBITDA and  unusual  items to net income  (GAAP),  is shown
below.



                                       12

<PAGE>


                                   FORM 10-Q/A
                                 AMENDMENT NO. 1
                          QUARTERLY REPORT ON FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2005


Reconciliation of Adjusted EBITDA to Net Income (GAAP)

                                         Three Months Ended Septmeber 30,
                                         ------------------------------
                                              2005             2004
                                         ---------------  -------------
Total Adjusted EBITDA                   $        51,849 $     (331,207)
     Depreciation & Amortization               (657,198)      (398,879)
     Interest & Financing Expenses           (1,368,217)    (1,167,591)
     Interest and Other Income                   86,556         78,317
     Income Tax (Expense) Benefit                (7,000)        42,000
Net Income (Loss) before Unusual Items       (1,894,010)    (1,777,360)
     Extraordinary Item                               -      3,560,000
     Start Up Costs for Big Easy             (2,332,773)             -
     Impairment Loss                                  -       (200,000)
                                         ---------------  -------------
Net Income (Loss)                       $    (4,226,783) $   1,582,640
                                         ===============  =============




                                       13

<PAGE>


                                   FORM 10-Q/A
                                 AMENDMENT NO. 1
                          QUARTERLY REPORT ON FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2005


ITEM 6. EXHIBITS

Exhibit
Description of Exhibit

31.1 CEO  Certification   pursuant  to  rule  13a-14(a)  and  15d-14(a)  of  the
     Securities Exchange Act of 1934

31.2 CFO  Certification   pursuant  to  rule  13a-14(a)  and  15d-14(a)  of  the
     Securities Exchange Act of 1934

32   CEO & CFO  Certification  pursuant to 18 U.S.C.  Section  1350,  As Adopted
     Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.




                                       14

<PAGE>


                                   FORM 10-Q/A
                                 AMENDMENT NO. 1
                          QUARTERLY REPORT ON FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2005




                    INTERNATIONAL THOROUGHBRED BREEDERS, INC.
                                AND SUBSIDIARIES

                                   SIGNATURES


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



April 3, 2006      /s/Francis W. Murray
                   ---------------------------------------------------------
                   Francis W. Murray, President, Chief Executive Officer and
                   Chief Financial Officer







                                       15

<PAGE>


                                   FORM 10-Q/A
                                 AMENDMENT NO. 1
                          QUARTERLY REPORT ON FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2005

                                                                    Exhibit 31.1

             CEO CERTIFICATION PURSUANT TO RULE 13A-14 AND 15D-14 OF
                     THE SECURITIES AND EXCHANGE ACT OF 1934

I, Francis W. Murray, certify that:

     1.   I have reviewed this quarterly  report on Form 10-Q/A of International
          Thoroughbred Breeders;

     2.   Based on my  knowledge,  this  quarterly  report  does not contain any
          untrue  statement of a material  fact or omit to state a material fact
          necessary to make the statements  made, in light of the  circumstances
          under which such  statements were made, not misleading with respect to
          the period covered by this quarterly report;

     3.   Based on my knowledge,  the financial statements,  and other financial
          information  included in this quarterly report,  fairly present in all
          material respects the financial  condition,  results of operations and
          cash flows of the registrant as of, and for, the periods  presented in
          this quarterly report;

     4.   The registrant's  other certifying  officers and I are responsible for
          establishing  and maintaining  disclosure  controls and procedures (as
          defined in Exchange  Act Rules  13a-14 and 15d-14) for the  registrant
          and we have:

               a)   designed such  disclosure  controls and procedures to ensure
                    that  material   information  relating  to  the  registrant,
                    including its consolidated subsidiaries, is made known to us
                    by others  within those  entities,  particularly  during the
                    period in which this quarterly report is being prepared;

               b)   evaluated the  effectiveness of the registrant's  disclosure
                    controls and procedures as of a date within 90 days prior to
                    the filing date of this  quarterly  report (the  "Evaluation
                    Date"); and

               c)   presented in this quarterly report our conclusions about the
                    effectiveness  of the  disclosure  controls  and  procedures
                    based on our evaluation as of the Evaluation Date;

     5.   The registrant's other certifying officers and I have disclosed, based
          on our most recent  evaluation,  to the registrant's  auditors and the
          audit  committee  of  registrant's  board  of  directors  (or  persons
          performing the equivalent functions);

               a)   all  significant  deficiencies in the design or operation of
                    internal   controls   which  could   adversely   affect  the
                    registrant's  ability  to  record,  process,  summarize  and
                    report   financial   data  and  have   identified   for  the
                    registrant's  auditors any material  weaknesses  in internal
                    controls; and

               b)   any fraud, whether or not material, that involves management
                    or  other  employees  who  have a  significant  role  in the
                    registrant's internal controls; and

     6.   The  registrant's  other  certifying  officers and I have indicated in
          this quarterly report whether or not there were significant changes in
          internal controls or in other factors that could significantly  affect
          internal   controls   subsequent  to  the  date  of  our  most  recent
          evaluation,   including   any   corrective   actions  with  regard  to
          significant deficiencies and material weaknesses.


Date: April 3, 2006

                       /s/Francis W. Murray
                       -------------------------------------------------------
                       Chairman/Chief Executive Officer/Chief Financial Officer



                                       16

<PAGE>


                                   FORM 10-Q/A
                                 AMENDMENT NO. 1
                          QUARTERLY REPORT ON FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2005

                                                                    Exhibit 31.2


             CFO CERTIFICATION PURSUANT TO RULE 13A-14 AND 15D-14 OF
                     THE SECURITIES AND EXCHANGE ACT OF 1934

I, Francis W. Murray, certify that:

     1.   I have reviewed this quarterly  report on Form 10-Q/A of International
          Thoroughbred Breeders;

     2.   Based on my  knowledge,  this  quarterly  report  does not contain any
          untrue  statement of a material  fact or omit to state a material fact
          necessary to make the statements  made, in light of the  circumstances
          under which such  statements were made, not misleading with respect to
          the period covered by this quarterly report;

     3.   Based on my knowledge,  the financial statements,  and other financial
          information  included in this quarterly report,  fairly present in all
          material respects the financial  condition,  results of operations and
          cash flows of the registrant as of, and for, the periods  presented in
          this quarterly report;

     4.   The registrant's  other certifying  officers and I are responsible for
          establishing  and maintaining  disclosure  controls and procedures (as
          defined in Exchange  Act Rules  13a-14 and 15d-14) for the  registrant
          and we have:

               a)   designed such  disclosure  controls and procedures to ensure
                    that  material   information  relating  to  the  registrant,
                    including its consolidated subsidiaries, is made known to us
                    by others  within those  entities,  particularly  during the
                    period in which this quarterly report is being prepared;

               b)   evaluated the  effectiveness of the registrant's  disclosure
                    controls and procedures as of a date within 90 days prior to
                    the filing date of this  quarterly  report (the  "Evaluation
                    Date"); and

               c)   presented in this quarterly report our conclusions about the
                    effectiveness  of the  disclosure  controls  and  procedures
                    based on our evaluation as of the Evaluation Date;

     5.  The registrant's other certifying officers and I have disclosed, based
         on our most recent evaluation, to the registrant's auditors and the
         audit committee of registrant's board of directors (or persons
         performing the equivalent functions);

              a)  all significant deficiencies in the design or operation of
                  internal controls which could adversely affect the
                  registrant's ability to record, process, summarize and report
                  financial data and have identified for the registrant's
                  auditors any material weaknesses in internal controls; and

              b)  any fraud, whether or not material, that involves management
                  or other employees who have a significant role in the
                  registrant's internal controls; and

     6.   The  registrant's  other  certifying  officers and I have indicated in
          this quarterly report whether or not there were significant changes in
          internal controls or in other factors that could significantly  affect
          internal   controls   subsequent  to  the  date  of  our  most  recent
          evaluation,   including   any   corrective   actions  with  regard  to
          significant deficiencies and material weaknesses.


Date: April 3, 2006

                        /s/Francis W. Murray
                        --------------------------------------------------------
                        Chairman/Chief Executive Officer/Chief Financial Officer


                                       17

<PAGE>


                                   FORM 10-Q/A
                                 AMENDMENT NO. 1
                          QUARTERLY REPORT ON FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2005

                                                                      Exhibit 32

                CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
                      AS ADOPTED PURSUANT TO SECTION 906 OF
                         THE SARBANES-OXLEY ACT OF 2002

     In  connection  with the filing of the  Quarterly  Report on Form 10-Q/A of
International  Thoroughbred Breeders,  Inc. (the "Company") for the three months
ended September 30, 2005 as filed with the Securities and Exchange Commission on
the date hereof (the "Report"), I, Francis W. Murray, Chief Financial Officer of
the Company,  hereby certify pursuant to 18 U.S.C.  ss.1350, as adopted pursuant
to  Section  906 of the  Sarbanes-Oxley  Act of  2002,  that,  to the best of my
knowledge:

     (1) The Report fully  complies  with the  requirements  of Section 13(a) or
Section 15(d) of the Securities Exchange Act of 1934; and

     (2)  The  information  contained  in the  Report  fairly  presents,  in all
material  respects,  the  financial  condition  and results of operations of the
Company.



/s/ Francis W. Murray
-----------------------
Name: Francis W. Murray
Title: Chief Financial Officer
April 3, 2006


                                       18

<PAGE>