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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 20-F

o ANNUAL REPORT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES
      EXCHANGE ACT OF 1934ORANNUAL
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934For the fiscal year ended December 31, 2003ORo TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
      SECURITIES EXCHANGE ACT OF 1934Commission
      file number: 0-28954


International Thunderbird Gaming Corporation(Exact Name of Registrant as Specified in its Charter )Not Applicable(Translation of Registrant's Name into English)British Columbia(Jurisdiction of Incorporation or Organization)12155 Dearborn Place, Poway, CA 92064(Address of principal executive offices)Securities registered or to be
      registered pursuant to Section 12(b) of the Act: Not Applicable.Securities registered or
      to be registered pursuant to Section 12(g) of the Act:
      common shares without par value(Title of Class)Securities for which there
      is a reporting obligation pursuant to Section 15(d) of the Act: Not
      Applicable.
      Indicate the number of outstanding shares of each of the issuer's
      classes of capital or common stock as of the close of the period covered
      by the annual report. As of December 31, 2002, there were 23,475,868
      shares issued and outstanding.
      
      
      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.
      
      
      Indicate by check mark which financial statement item the registrant
      has elected to follow.
      [X] Item 17 [ ] Item 18.(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
      PROCEEDINGS DURING THE PAST FIVE YEARS.)
      
      
      Indicate by check mark whether the registrant has filed
      all documents and reports required to be filed by Sections 12, 13 or 15(d)
      of the Securities Exchange Act of 1934 subsequent to the distribution of
      securities under a plan confirmed by a court. Not Applicable.
      
      
      [ ] Yes [ ] No




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TABLE OF CONTENTS

GLOSSARY
      3PART IItem 1 - Identity of Directors, Senior Management and Advisors
      3Item 2 -
      Offer Statistics and Expected Timetable
      3Item 3 -
      Key Information
      3Item 4 - Information on the
      Company
      8Item 5 -
      Operating and Financial Review and Prospects
      25Item 6 -
      Directors, Senior Management and Employees
      34Item
      7 - Major Shareholders and Related Party Transactions
      42Item 8 - Financial Information
      44Item 9 - The Offering and Listing
      45Item 10 - Additional
      Information
      46Item 11 - Quantitative and Qualitative Disclosures About Market Risk
      52Item 12 - Description of Securities Other, than Equity SecuritiesPART IIItem
      13 - Defaults, Dividend Arrearages and Delinquencies
      52Item 14 - Material Modifications to the Rights of Security Holders and Use
      of Proceeds
      54Item 15 - [Reserved]Item 16 - [Reserved]Item 16A - Audit
      Committee Financial Expert
      55Item 16B - Code of Ethics
      58PART IIIItem
      17 - Financial Statements
      54Item 18 - Financial Statements
      54Item 19 -
      Exhibits
      55SIGNATURE
      63CONSOLIDATED FINANCIAL
      STATEMENTSCERTIFICATES




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Glossary
      
      
      Casino - a building or location designed to allow
      individuals to play various games of chance for money.
      
      Gaming Machine - a computerized slot machine that
      incorporates a central processing unit, memory, computer software and a
      number of reels to determine the frequency and amount of payout of prizes.
      It is distinguished from a VGT through the use of a number of reels as
      opposed to a video terminal screen to display the game to the user.
      
      Slot Machine - a machine, providing a game of chance,
      worked by the insertion of a coin and a random payout of coins based on
      the correct alignment of a number of reels.
      
      VGT or Video Gaming Terminal - a computerized video
      gaming machine that incorporates a video terminal screen, central
      processing unit, memory and computer software to determine the frequency
      and amount of payout of prizes.
      
      Skill Game - a game in which the player based on
      utilization of his sight, motor skills and dexterity may affect the
      outcome of the game.
      Item 1 - Identity of Directors, Senior Management and Advisers
      
      
      Not applicable.
      
      Item 2 - Offer
      Statistics and Expected Timetables
      
      
      Not applicable.
      
      Item 3 - Key
      Information
      
      
      Exchange Rate Information
      
      
      
      Except as otherwise indicated, all financial information
      in this annual report is presented in U.S. dollars.
      
      The Company's reporting currency is the U.S. dollar, as a
      significant portion of the Company's operating, investment and financing
      activities are now transacted in U.S. dollars. All figures have been
      stated in U.S. dollars. For companies in the group that maintain their
      records in Canadian dollars, monetary assets and liabilities have been
      translated into U.S. dollars at the year end rate, non-monetary items are
      translated at historical rates, and revenues and expenses translated at
      average rates for the period with any resulting gain or loss charged to
      operations.
      
      The current rate method is used to translate the financial
      statements of foreign operations. Under the current rate method, assets
      and liabilities are translated at exchange rates in effect at the balance
      sheet date and items in the statement of operations are translated at
      weighted average rates. Exchange gains and losses arising from the
      translation of the financial statements are deferred and included in the
      cumulative translation account in shareholders' equity until there has
      been a realized reduction in the net investment. The cumulative
      translation account at December 31, 2002, 2001, 2000 and 1999 relates
      mainly to the Company's Guatemalan operations.
      
      Selected Financial Data
      
      
      
      The following tables set forth selected consolidated
      financial data. Such data for and as of the end of the fiscal years ended
      December 31, 2002, 2001, 2000, 1999, and 1998 is derived from the
      consolidated financial statements of the Company. The selected financial
      data as at December 31, 2002 and 2001 and in each of the years in the
      three year period ended December 31, 2002, should be read in conjunction
      with the Consolidated Financial Statements of the Company and the Notes
      thereto contained elsewhere in this Annual Report.
      
      The Consolidated Financial Statements of the Company have
      been prepared in accordance with accounting principles generally accepted
      in Canada ("Canadian GAAP"). These principles, as applied to the Company,
      differ from those generally accepted in the United States ("U.S. GAAP") as
      set forth in Note 23 to the Consolidated Financial Statements of the
      Company.
      
      The following is a summary of certain selected financial
      data for the years ended December 31, 2002, 2001, 2000, 1999, and 1998.
      
      Fiscal year ended December 31,


(All in $1,000s
      except 
      earnings (loss) per 
      share)
      2002
      2001
      2000
      1999
      1998Canadian GAAPFor
      the period:Revenues:
      $18,519
      $16,420
      $16,194
      $13,943
      $10,944Net income (loss):
      324
      (3,080)
      (1,291)
      812
      (11,287)Net income (loss) 
   from continuing 
   operations:
      283
      (1,893)
      (629)
      936
      (2,685)Earnings (loss) per 
    share (basic):
      0.01
      (0.13)
      (0.06)
      0.03
      (0.49)Earnings (loss) per 
    share from 
    continuing 
    operations (basic):
      0.01
      (0.08)
      (0.03)
      0.04
      (0.12)Earnings (loss) per 
    share (diluted):
      0.01
      (0.13)
      (0.06)
      0.03
      (0.49)End of period working 
     capital (deficiency):
      (2,806)
      (3,081)
      (2,102)
      (1,180)
      (5,353)Total assets:
      14,553
      13,799
      13,789
      15,501
      16,791Long term debt:
      4,232
      4,296
      1,896
      2,060
      1,694Total liabilities and minority
      interest:
      13,066
      12,766
      9,733
      10,202
      12,196Share capital:
      21,085
      21,089
      21,032
      20,981
      20,964Number of shares (000's omitted)
      23,476
      23,490
      23,314
      23,159
      23,090Cumulative translation
      (277)
      (411)
      (411)
      (408)
      (283)Deficit:
      (19,321)
      (19,645)
      (16,565)
      (15,274)
      (16,086)Fiscal year ended December 31,


(All in $1,000s except 
      earnings (loss) per share)
      2002
      2001
      2000
      1999
      1998US GAAP for periods for which financial statements of the
      Company are included in this Annual ReportFor the period:Revenues:
      $18,519
      $16,420
      $16,194
      $13,943
      $10,944Net income (loss):
      478
      (2,849)
      (1,941)
      498
      (10,651)Net income (loss) 
     from continuing 
     operations:
      437
      (1,928)
      (1,013)
      622
      (2,685)Earnings (loss) per 
     share (basic):
      0.01
      (0.12)
      (0.09)
      0.02
      (0.46)Earning (loss) per 
     share from 
     continuing 
     operations (basic):
      0.01
      (0.08)
      (0.05)
      0.04
      (0.12)Earnings (loss) per 
     share (diluted):
      0.01
      (0.12)
      (0.09)
      0.02
      (0.46)End of period working 
     capital (deficiency):
      (4,691)
      (5,226)
      (2,102)
      (1,180)
      (5,353)Total assets:
      14,483
      13,566
      13,268
      15,501
      16,791Long term debt:
      2,374
      2,151
      1,896
      2,060
      1,694Total liabilities and 
     minority interest:
      13,066
      12,766
      9,733
      10,202
      12,196Share capital:
      21,630
      21,634
      21,475
      20,981
      20,964Cumulative 
     translation
      (277)
      (411)
      (411)
      (408)
      (283)Deficit:
      (19,900)
      (20,378)
      (17,529)
      (15,588)
      (16,086)




The Company has never declared a dividend.
      
      The information includes the results of the operations of
      the subsidiaries from the date of acquisition.
      
      Risk Factors
      
      
      The Company, and thus the securities of the Company,
      should be considered a highly speculative investment and investors should
      carefully consider all of the information disclosed in this Annual Report
      prior to making an investment in the Company. The Company operates in a
      risky business environment. There are a number of risks inherent to the
      Company's business. In addition to the other information presented in this
      Annual Report, the following risk factors should be given special
      consideration when evaluating an investment in any of the Company's
      securities.1.
      Going Concern. The consolidated financial
      statements have been prepared on a going concern basis in accordance with
      Canadian generally accepted accounting principles, which assumes that the
      Company will continue in operation for the foreseeable future and be able
      to realize its assets and discharge its liabilities and commitments in the
      normal course of business. However, the Company has incurred significant
      losses to the year ended December 31, 2001, has a working capital
      deficiency at December 31, 2002 of $2,806,000 (2001 - $3,081,000) and has
      recently had to seek a waiver from its primary lender relating to covenant
      violations on certain borrowings as at December 31, 2002 (see Note 9 to
      the Audited Financial Statements - loans payable).
      
      During the year ended December 31, 2001, Fiesta Casinos
      Guayana, C.A. ("Fiesta Casinos Guayana"), the Venezuelan company in which
      the Company has an equity interest, may have been subjected by the
      National Casinos, Bingo Parlors and Slot Machines Commission of Venezuela
      (the "Commission") to penalties and fines because it transferred all of
      its shares to a national financial institution as security, thereby
      violating certain provisions of the Control of Casinos, Bingo Parlors and
      Slot Machines Act. On December 21, 2001, in response to Fiesta Casinos
      Guayana's request for authorization to keep the security in force, the
      Commission asked the Company to add a clause to the final loan contract
      stipulating that Fiesta Casinos Guayana must obtain prior authorization
      from the Commission to proceed to judicial sale or undertake any other
      legal transaction which implies transfer of ownership of the shares put up
      as security, initially or as a result of a capital increase by Fiesta
      Casinos Guayana. Fiesta Casinos Guayana had not made the change in the
      final loan contract required by the Commission and had not made any
      provisions in its financial statements at December 31, 2001 for any
      possible penalties and fines relating to this issue. During the current
      year the loan was paid in full and consequently the Company is no longer
      in violation as at December 31, 2002.
      
      Since July 2001, the Company has been working to develop
      future profitable operations and improve the working capital position of
      the Company. During the year ended December 31, 2001, the Company
      refocused its efforts toward the operation and profitability of current
      facilities as opposed to the development of new facilities. As a result,
      the Company reduced its development and support staff and related
      expenses. In addition, the Company reduced its staff levels in the
      Republic of Panama and refinanced a portion of its debt during the year.
      
      The ability of the Company to continue as a going concern
      and to realize the carrying value of its assets and discharge its
      liabilities when they become due is dependent on the success of its core
      operations. Management believes that the core operations, in conjunction
      with the expected increase in profits from the Company's investments in
      Venezuela and Nicaragua, which commenced operations in the year ended
      December 31, 2001, will mitigate the adverse conditions and events which
      raise doubt about the validity of the going concern assumption used in
      preparing these financial statements.
      
      During 2001, the Mexican government closed the skill game
      facilities in Matamoros, Nuevo Laredo and Reynosa, Mexico in which the
      Company has an equity interest, alleging the operations are in violation
      of the law. The Company is currently pursuing a claim under section 11 of
      the North American Free Trade Agreement.
      
      The auditor's report on the Company's December 31, 2002
      financial statements includes additional comments that state that the
      financial statements are affected by conditions and events that cast doubt
      on its ability to continue as a going concern. The financial statements do
      not include any adjustments that may result from the outcome of that
      uncertainty.2.
      Regulatory. The ability to sell or place
      Gaming Machines in any country is dependent upon the regulatory
      authorities of various levels of government. The rulings made by the
      governments continue to fluctuate and are dependent upon a number of
      political, economic and public-oriented factors. The Company is dependent
      upon the government ruling in favor of allowing casino gaming and
      specifically VGTs and slot machines in their jurisdiction. Adverse
      government rulings may have a significant impact on the Company's ability
      to generate revenue.
      
      Gobernacion, an agency of the Mexican government, on
      October 11, 2001, shut down the Company's Mexico Operations. The Company
      filed a NAFTA claim and a trial is scheduled for April 2004.3.
      Competition. The
      Company's products compete against those of other established companies,
      some of which have greater financial, marketing, and other resources than
      those of the Company. These competitors may be able to institute and
      sustain price wars, or imitate the features of the Company's products,
      resulting in a reduction of the Company's share of the market and reduced
      price levels and profit margins. In addition, there are no significant
      barriers to new competitors entering the marketplace.4.
      Marketplace. The
      marketplace for the Company's products and services is constantly
      undergoing change. Currently, revenue earned in the casino gaming industry
      in the global market continues to increase. As the casino gaming market
      matures, global demand will be expected to stabilize. The Company's
      continued profitability and growth will be dependent upon maintaining and
      expanding its market share of global markets.5.
      Management. The
      Company is dependent on a relatively small number of key employees, the
      loss of any one of whom could have an adverse effect on the Company.6.
      Marketing Plan. The
      Company's internal marketing plan is based on a number of assumptions,
      which may or may not prove valid. Marketing expenditures are to be funded
      partly from cash flow from operations. Poor market acceptance of the
      Company's products or other unanticipated events may result in lower
      revenues than anticipated, making the planned expenditures on advertising
      and promotion unachievable.7.
      Exchange Rate Fluctuation.
      The profitability of the Company may be adversely affected by fluctuations
      in the rate of exchange among various currencies. The Company does not
      currently take any steps to hedge against currency fluctuations.These business risks should be considered in the context
      of the Company's business, which is described below.
      
      Item 4 -
      Information on the Company
      
      
      History and Development of the Company
      
      
      Overview of the Business. The Company is a holding
      company that provides financial and managerial resources to its operating
      subsidiaries. It carries out its business through its operating
      subsidiaries.1.
      Discontinued Operations from 1994 to 2002.A.
      Before April 30, 1994, the Company was in the business of exploring and
      developing natural resource properties. All of these properties were
      abandoned and written off by the Company by December 31, 1993.B.
      Since April 30, 1994, the Company completed a number of
      acquisitions and joint ventures by which it has acquired a number of
      operating entities.(1)
      The Company acquired 51% of the issued and outstanding
      common shares of Thunderbird Carolina (formerly Pars Electronics, Inc. and
      Thunderbird Gaming (North Carolina) Inc.), a North Carolina corporation,
      effective December 31, 1994. The purchase of the remaining 49% of
      Thunderbird Carolina was effective January 1, 1995. Thunderbird Carolina
      previously assembled and distributed a series of touch screen and button
      control VGTs in an assembly plant in Charlotte, North Carolina. The plant
      has wound up its assembly operations in 1998 and liquidated its holdings
      in the South Carolina sale and service location.(2)
      The Company acquired 51% of Thunderbird Greeley (formerly
      Ram Star, Inc. and Thunderbird Gaming (Colorado) Inc.), a Colorado
      corporation, effective December 31, 1994. The purchase of the remaining
      49% of Thunderbird Greeley was effective January 1, 1995. Thunderbird
      Greeley was purchased to complement Thunderbird Carolina's line of touch
      screen VGTs with a line of button control VGTs that were assembled in a
      plant in Greeley, Colorado. Subsequent to the acquisition, Thunderbird
      Greeley established a sales and service warehouse in Temecula, California
      to service the California market. As well, Thunderbird Greeley jointly
      placed machines on a revenue sharing basis in the Hopland, Sho-Ka-Wah
      casino with the Viejas (Baron Long) Group of Capital Grande Bank of the
      Diegueno Mission Indians of the Viejas Reservation, California ("Viejas").
      In 1998, the Company liquidated its assembly plant in Greeley, Colorado
      and the sales and service branch in Temecula, California. Since December
      31, 1994, Thunderbird Greeley has manufactured gaming machines for third
      parties and for sale to its related affiliates for revenue sharing
      agreements. In 1998, as part of its effort to cut costs, the Company
      assessed the costs involved in assembling its gaming machines and
      determined that the costs of assembling "in-house" exceeds the costs to
      outsource the assembly. As a result, the Company closed its Colorado
      facility.(3)
      International Thunderbird Gaming SRL ("ITGS") was
      organized as a Society with Restricted Liability under the laws of
      Barbados on March 7, 1996 and was owned 10% by ITG-NS and 90% by TGI. On
      January 23, 1998, 100% of the ownership was transferred to Thunderbird
      Greeley, Inc. ITGS placed gaming machines and other equipment on
      California Native American lands, either by sale or revenue share
      agreements. On March 31, 1996, all revenue share arrangements held by TGI
      were transferred to ITGS, along with the transfer of the related revenue
      share VGTs. On May 13, 1998, ITGS ceased collecting revenue from three
      non-compacted California Native American tribes as mandated by the U.S.
      Attorneys. On August 21, 1998, ITGS assigned these revenue share
      agreements to a third party. The assets related to these tribes were
      written off or agreed to be sold to a third party. In 1999, the third
      party's collection efforts proved to be unsuccessful and they were left
      with no alternative but to pursue litigation. Due to the third party's own
      business interests and goodwill with the Tribes, the Company and the third
      party agreed to a mutual rescission of the sale and assignment of the
      Company's California based revenue share agreements and the California
      gaming assets reverted back to the Company. The Company continued to
      collect revenue from one of its five revenue share arrangements since May
      13, 1998, that being the Table Mountain Tribe. Table Mountain entered into
      a state compact on May 13, 1998, thereby avoiding any legal confrontation
      with the U.S. government. As of January 1, 2000, ITGS assigned this
      revenue share agreement to Thunderbird Greeley, Inc.(4)
      Pursuant to a share purchase agreement effective October
      10, 1997, the Company acquired 90% of the issued and outstanding common
      shares of Calsino, a manufacturer of electronic signs. On May 1, 1999, the
      Company acquired the remaining 10% interest in Calsino, Inc. On October 1,
      2000, the Company sold substantially all the assets and liabilities of
      Calsino to the management of the subsidiary.(5)
      On November 12, 1997, the Company acquired Oceanside
      Casino N.V., operators of the Aruba Palm Beach Hotel's casino on the
      island of Aruba pursuant to an agreement dated November 7, 1997. The
      Company, through its subsidiary, Oceanside Casinos N.V., an Aruba entity,
      operated the Casino Merengue in Aruba through October of 1998. The Company
      shut down operations of the casino due to lack of profitability with no
      prospects of a turnaround. The Oceanside Casino N.V. subsidiary filed a
      petition for bankruptcy in November of 1998.(6)
      In March 2000, the Company, through its subsidiary
      Fiestacasinos.com, entered into an agreement with Cryptologic's
      subsidiary, Intertainet Overseas Licensing Limited (IOLL), in which IOLL
      provides its Internet gaming software and support services to
      Fiestacasinos.com. Operations began in June 2000, with all U.S. and
      Panamanian based customers blocked from accessing the on-line casino. In
      June 2001, the Company determined that the market for on-line casinos
      outside of the U.S. and Panama was not sufficient to support the business.
      The Company sold the subsidiary to a third party willing to take U.S. and
      Panamanian-based customers.(7)
      Manufacture and Installation of Gaming and Commercial
      Signage & Display: The Company operated a casino signage and design
      company ("Calsino") that also developed a commercial signage business.
      Calsino was active in marketing and installing commercial and casino
      gaming machine signage and lighting systems. Calsino designed signage and
      displays for gaming establishments, which historically update their themes
      and change decor often to continually attract patrons. The signage
      division offered a wide range of graphics, incorporating state of the art
      3-D sculptured displays, utilizing multi-colored fiber optics and
      interactive multimedia displays with lights, sound and animation. The
      manufacturing and installation of the signage was outsourced through
      various subcontractors. Calsino also sold multi-faced, multi-level signage
      and progressive meter systems for slot and video machines. As of May 13,
      1998, the Company ceased receiving revenue from four non-compacted
      California Native American tribes as mandated by the U.S. Attorneys. On
      August 21, 1998, the revenue share agreements with these four tribes were
      assigned to a third party.(8)
      The effects on revenue and assets resulting from the
      cessation of activities related to gaming on certain Tribal lands have
      been significant. The Company ceased its revenue share agreement
      activities with non-compacted tribes in California on May 13, 1998. The
      Company was averaging $1,438,000 per month in revenue from California
      revenue share operations for the period January 1, 1998 to May 13, 1998.
      The Company continued to collect revenue from one of its five revenue
      share arrangements since May 13, 1998, that being the Table Mountain
      Tribe. Table Mountain entered into a state compact on May 13, 1998,
      thereby avoiding any legal confrontation with the U.S. government. The
      Company continued to receive revenues until the first quarter of 2001 from
      Table Mountain.(9)
      The Company sold and assigned all of its rights in its
      California based Revenue Share Agreements with the various non-compacted
      Tribes to Support Consultants, Inc. ("SCI"), an unrelated California
      corporation, in furtherance of its commitment to honor the mandate set by
      the U.S. Attorneys in California. The assignment included transfer of the
      Company's rights to revenue from the revenue share arrangements with the
      various Tribes as well as assignment of loans. Title to the machines was
      not transferred to SCI. In consideration for the assignment to SCI, the
      Company accepted a note receivable (the "Note") in the amount of
      $4,500,000 to be paid in installments over three years, contingent upon
      SCI's success in collecting such sums from the various Tribes. The amount
      of consideration was based on numerous factors, including the present
      value of the revenue stream, the assumption of all support and maintenance
      obligations by SCI, and the likelihood that any revenue and loans will be
      collected by SCI. The transaction was not recorded as a sale in the
      December 31, 1998 financial statements, but rather the Company's
      California assets were presented as "Assets Held for Disposal", as the
      collection of the consideration from SCI was dependent on SCI collecting
      sufficient payments from the Native Tribes on assets sold once the legal
      status of Native Gaming in California was settled.(10)
      In 1999, SCI's collection efforts proved to be
      unsuccessful and SCI was left with no alternative but to pursue
      litigation. Due to SCI's own business interests and goodwill with the
      Tribes, the Company and SCI agreed to a mutual rescission of the sale and
      assignment of the Company's California based revenue share agreements and
      the California gaming assets reverted back to the Company. Since the
      rescission of the assignments, the Company has successfully pursued the
      various Tribes for collection of the unpaid revenue share amounts and
      loans receivable. To date, the Company has collected in excess of
      $4,894,000 from various Tribes. The Company continues to aggressively
      pursue collection of additional amounts from other Tribes.(11)
      Distributions of Gaming Products (Shuffler): In June 1999,
      Calsino acquired the U.S. and Central American distribution rights for a
      mechanical card shuffler, manufactured by a third-party Australian
      company. In May 2000, due to poor sales performance and lack of
      profitability, the Company entered into an agreement with the above third
      party Australian company to relinquish the distribution rights of the
      mechanical card shuffler. In exchange for the Company's efforts, the
      Australian Company has agreed to pay a royalty to the Company on all
      machines sold in the former areas held. In May 2001, the third-party
      Australian company entered into various agreements with Shuffle Master,
      Inc. ("SM") whereby SM acquired certain assets and assumed certain
      liabilities of the third party Australian company. In May 2002 the Company
      received a settlement payment from SM of $150,000. The Company does expect
      to receive any more monies from this transaction.(12)
      On October 1, 2000, the Company's interest in the signage
      business was sold to the management of Calsino in exchange for an interest
      bearing, five-year note receivable, secured by the assets of the signage
      business. During fiscal 2001, the note receivable was written down to nil,
      reflecting management's uncertainty of its ability to collect under the
      terms of the note.(13)
      Internet Gaming (outside of the U.S. and Panama): In March
      2000, the Company, through its subsidiary Fiestacasinos.com, entered into
      an agreement with Cryptologic's subsidiary, Intertainet Overseas Licensing
      Limited (IOLL), in which IOLL provides its Internet gaming software and
      support services to Fiestacasinos.com. Operations began in June 2000, with
      all U.S. and Panamanian based customers blocked from accessing the on-line
      casino. In June 2001, the Company determined that the market for on-line
      casinos outside of the U.S. and Panama was not sufficient to support the
      business. The Company has sold the subsidiary to a third party willing to
      take U.S. and Panamanian based customers.(14)
      The Company, through its investments in EDM - Matamoros,
      EDM - Laredo and EDM- Reynosa operated skill game locations in Matamoros,
      Nuevo Laredo and Reynosa, Mexico. The Matamoros facility opened in August
      2000, the Nuevo Laredo facility opened in February 2001 and the Reynosa
      facility opened in August 2001. The Company accounts for the investments
      on an equity basis, based on its respective ownership percentage. The
      Company owns 36.67% of EDM - Matamoros, 33.33% of EDM - Laredo and 40% of
      EDM - Reynosa. In October 2001, the facilities were shut down by Mexico's
      ministry of the interior (Gobernacion) and are now the subject matter of a
      NAFTA claim filed by the Company contending that such operations were
      illegally shut down. The NAFTA trial is schedule for the week of April 24,
      2004.2.
      Current OperationsA.
      The Company, through its subsidiary, International Thunderbird Gaming
      (Panama) Corporation, was successful in its January 1998 bid for the Group
      "A" package consisting of five complete casino licenses within the
      Republic of Panama. A complete casino license offers a combination of
      gaming tables and Type A slot machines, along with any other combination
      of gaming or gambling devices. During 1998, the Company successfully
      developed and opened four casinos. In 2000 the subsidiary opened a fifth
      facility on the island of Contadora. During 2001, due to a lack of
      business the Company closed its casino on the island of Contadora. The
      Company through Thunderbird Panama now operates six casinos in the
      Republic of Panama under the name "Fiesta Casinos" under a renewable
      20-year concession. The six casinos operate in the El Panama Hotel, Hotel
      Soloy, Hotel Nacional, Hotel Washington, Hotel Guayacanes and Hotel
      Decameron.B.
      In September 1997, the Company, through its subsidiary,
      Thunderbird de Guatemala, entered into an agreement with Public Gaming
      Research Institute, Inc. ("PGR"), and its wholly owned subsidiary,
      Institute for the Lotteries of Latin America and the Caribbean ("ILAC"),
      to supply and manage gaming machines for gaming facilities in Central
      America. PGR, through ILAC, has been issued a license to operate lottery
      establishments and PGR selected the Company to supply machines under a
      revenue sharing agreement for a term of five years. Operations commenced
      in February 1998 at the Camino Real Hotel in Guatemala City. In 2003, the
      Company entered into a seven-year agreement with ILAC to continue
      operations of its video lottery terminals at the Camino Real Hotel in
      Guatemala City.C.
      During 2000, the Company, though its subsidiary
      Thunderbird de Nicaragua, leased space under a five-year lease, with an
      option for another five years in the Hotel InterContinental, Managua,
      Nicaragua, and commenced demolition and renovation. The casino opened in
      February 2001 with 77 table positions and 37 machines in operation. At the
      end of December 31, 2002, the Company owned a direct 74% interest in the
      subsidiary and an additional 5% interest through Thunderbird Panama, for a
      combined ownership interest of 79%. The Company through Thunderbird de
      Nicaragua operates a casino in the Republic of Nicaragua under the name
      Fiesta Casinos. In March 2003, the Company merged its operation with
      Hopewell Ltd's Pharaoh's Casino and now owns a 21% share in the merged
      operation.D.
      The Company, through its investment in South America
      Entertainment Investment owns a 36% interest in Fiesta Casino Guayana
      C.A., and operates a casino in the InterContinental Hotel in Guayana,
      Venezuela. During 2000, the Company leased space in the Hotel
      InterContinental Guayana in Guayana, Venezuela, and pursued a gaming
      license for the property. The facility opened on August 16, 2001 with
      approximately 115 table positions and 100 slot machines. The size of the
      casino can be expanded to 24,000 square feet, should market demand warrant
      such an expansion. The term of the lease is ten years from August 2000,
      with an additional ten-year option to renew subject to renegotiation of
      major terms. As part of the agreement, the casino has secured the right to
      build and operate a 20,000 square foot Events Center. The Events Center
      shall have a dual purpose: (1) to enhance hotel marketability and (2) to
      host casino special events, concerts and sporting events. Management
      believes that the Events Center will give the casino and hotel operations
      a unique strategic advantage. The Company accounts for the investments on
      an equity basis, based on its respective ownership percentage.E.
      The Company focused on:
      The opening of Chitre Casino (Guayacanes) in Panama, two
        major expansions at Soloy Casino in Panama and the major expansion and
        upgrade of the El Panama Casino in Panama City;
        The renegotiations of rent and stabilization of
        operations in Managua as a prelude to a successful merger with Pharaoh's
        casino in Managua, Nicaragua in March 2003;
        Initiation of the NAFTA litigation and assembly of a
        litigation team with a trial scheduled in April 2004 concerning the
        Mexico operation;
        Settlement and recovery of all remaining California
        tribal receivables;
        Securing long-term business in Guatemala and completing
        the arbitration. The Company entered into a seven-year agreement with
        ILAC to continue operations of its video lottery terminals at the Camino
        Real Hotel in Guatemala City. The Company will be entitled to 65% of
        revenue and will be responsible for 100% of the operating expenses while
        ILAC and the Pediatric Foundation share the remaining 35% of the
        revenues. The Company is assessing an expansion of video lottery
        machines and is confident that the Guatemala operation will continue to
        be a steady profitable business;
        Stabilizing the corporation's board and management with
        knowledgeable and engaged professionals;
        Stabilization of management and costs in Venezuela
        allowing survival in a difficult situation. The Company previously
        reported that the Fiesta Casino in Puerto Ordaz, Venezuela continues to
        meet its debt service and monthly operational expenses in spite of major
        political and civil unrest. The Intercontinental Hotel agreed to tie
        rent charges to a percentage of gross revenue determined on the basis of
        the Bolivar, which will significantly reduce the operations risk with
        respect to devaluation;
        Consolidation of the non-project corporate management to
        6 people, including the entire legal and accounting group;
        Saving more than 40% on the 2002 audit costs over the
        2001 expense; Renegotiating all the debt of the company to long-term
        payoffs with good concessions;
        Attaining good cash flows to handle obligations.3.     Business Plan: The
      Company has developed a management team with extensive experience and
      diverse backgrounds in state-regulated lotteries, gaming operations,
      international sales and law. The management team researches gaming
      opportunities when presented to the Company to determine their suitability
      with respect to the Company's short and long-term goals. The team
      typically researches financial viability, political risk issues, potential
      security risk, relevant state, federal or national gaming license
      requirements, and local labor law and tax issues, staffing requirements
      and projected revenue and expenses of a proposed opportunity. After
      development is complete, the Operations Team's responsibility shifts to
      the daily operation and maintenance of each facility. To successfully
      accomplish this, the team must acquire office space and staff, investigate
      the background of each potential employee prior to an offer of employment,
      research shipping and importation issues and regulations, duty taxes where
      applicable, and computer network capabilities and communication equipment
      requirements. Human Resource issues such as visas, work permits, payroll
      issues, and local labor law requirements, are researched in-depth prior to
      the commencement of operations in foreign locations. Finance and
      accounting personnel are hired locally to ensure compliance with relevant
      local tax and reporting requirements.4.     Business Strategy. The
      Company's business model is now well refined: diversify operations across
      a number of different partners, properties and jurisdictions, commit the
      minimum level of financial capital consistent with maximizing the
      opportunity so as to minimize project-specific risk, develop our human
      resources internally and through external hiring and establish
      relationships with well-established local partner sources of capital to
      help minimize jurisdiction-specific political risk.
      
      Thunderbird's business model is a first mover strategy
      targeted at capturing dominant market shares in the secondary markets of
      the region such as Central America and Mexico's provincial areas, a
      strategy reinforced by offering a distinctive product tailored to each
      individual market's consumer tastes and regulatory environment. The
      Company typically enters markets through local partnership structures,
      which provide critical local market, regulatory, and legal knowledge that
      mitigates many of the risk factors of entering and operating in the
      region.
      
      The Company has historically exploited the region's
      secondary markets in order to achieve high levels of market share within
      short time frames, specifically avoiding the highly competitive
      environments that exist in the primary segments of large markets such as
      Mexico City. The objective of this strategy is the creation of a
      pan-regional platform with the longer-term intent of expanding the
      platform into Latin America's larger primary markets.
      
      Another key aspect of Thunderbird's strategy is its use of
      product differentiation to achieve and retain market share. The Company's
      casinos are built around adapting the U.S. "Las Vegas" model that is more
      culturally attuned to the Latin consumer mindset than the "European" model
      which has traditionally prevailed in the region. This product distinction
      is further enhanced by a localization strategy that tailors operations to
      the specific tastes of each marketplace.
      This basic business model is reinforced by a management
      and control infrastructure that provides Thunderbird with a significant
      advantage over its peer group. Thunderbird's management team, drawn from
      both U.S. and local sources, has a successful track record of operating
      gaming facilities in both the U.S. markets and in Latin America, including
      significant experience in Latin American gaming regulatory issues. This
      management strength is further complemented by a point of sale monitoring
      system that provides a unique ability to monitor the firm's local
      operations and cash flows on a real time basis.
      
      This business model does not require the Company to raise
      capital through share offerings to finance growth, and no such offerings
      are planned.5.     Business Risks. The
      Company operates in a risky business environment. There are a number of
      risks inherent to the Company's business. These may be summarized as
      follows:A.
      Competition. The Company's products compete against
      those of other established companies, some of which have greater
      financial, marketing, and other resources than those of the Company. These
      competitors may be able to institute and sustain price wars, or imitate
      the features of the Company's products, resulting in a reduction of the
      Company's share of the market and reduced price levels and profit margins.
      In addition, there are no significant barriers to new competitors entering
      the marketplace.B.
      Marketplace. The marketplace for the Company's
      products and services is constantly undergoing change. Currently, revenue
      earned in the casino gaming industry in the global market continues to
      increase. As the casino gaming market matures, global demand will be
      expected to stabilize. The Company's continued profitability and growth
      will be dependent upon maintaining and expanding its market share of
      global markets.C.
      Management. The Company is dependent on a
      relatively small number of key employees, the loss of any one of whom
      could have an adverse effect on the Company.D.
      Marketing Plan. The Company's internal marketing
      plan is based on a number of assumptions, which may or may not prove
      valid. Marketing expenditures are to be funded partly from cash flow from
      operations. Poor market acceptance of the Company's products or other
      unanticipated events may result in lower revenues than anticipated, making
      the planned expenditures on advertising and promotion unachievable.E.
      Exchange Rate Fluctuation. The profitability of the
      Company may be adversely affected by fluctuations in the rate of exchange
      among various currencies. The Company does not currently take any steps to
      hedge against currency fluctuations.F.
      Regulatory. The ability to sell or place Gaming
      Machines in any country is dependent upon the regulatory authorities of
      various levels of government. The rulings made by the governments continue
      to fluctuate and are dependent upon a number of political, economic and
      public-oriented factors. The Company is dependent upon the government
      ruling in favor of allowing casino gaming and specifically VGTs and slot
      machines in their jurisdiction. Adverse government rulings may have a
      significant impact on the Company's ability to generate revenue.
      
      These business risks should be considered in the context
      of the Company's business, which is described above.






























Major Revenue Sources
          
          
          The following table outlines the consolidated revenues
          of the Company by category for the fiscal years ended December 31,
          2002, 2001 and 2000:Revenues by Category
          Year Ended
                       
          December 31, 2002
          Year Ended
                      
          December 31,
                        
          2001
          Year Ended
                       
          December 31,
                        
          2000Continuing operations:Revenue sharing revenues:
          $   1,088,000
          $   1,239,000
          $   1,424,000Casino operations:
          17,431,000
          15,181,000
          14,770,000Subtotal
          18,519,000
          16,420,000
          16,194,000Discontinued operations:Signage and equipment:
          ---
          ---
          1,004,000Subtotal
          ---
          ---
          1,004,000Total:
          $ 18,519,000
          $16,420,000
          $17,198,000




The Company's Subsidiaries
          
          
          The following table outlines the revenues of the
          Company for the fiscal years ended December 31, 2002, 2001 and 2000
          for each operating subsidiary.Revenues by Subsidiary
          Year Ended
    December 31, 
    2002
          Year Ended
            December 31,
            2001
          Year Ended
            December 31,
            2000Thunderbird Greeley Inc. (Thunderbird
          Greeley)
          $ 12,000
          $ 109,000
          $ 344,000International Thunderbird Gaming (Panama)
          Corporation
          14,717,000
          13,253,000
          14,379,000Thunderbird de Guatemala,
          S.A.
          1,762,000
          1,645,000
          1,449,000Fiestacasinos.com
          ---
          45,000
          22,000Thunderbird De Nicaragua
          2,028,000
          1,368,000
          ---18,519,000
          16,420,000
          16,194,000Discontinued operations:Calsino, Inc.
          ---
          ---
          1,004,000Subtotal
          ---
          ---
          1,004,000Total:
          $ 18,519,000
          $16,420,000
          $17,198,000




The following is a discussion of each of the Company's
          major operating subsidiaries.
          
          Thunderbird Greeley Inc.
          
          
          Thunderbird Greeley commenced operations as a
          partnership on November 22, 1988 under the name of F&G Partnership. On
          January 14, 1994, the business was incorporated under the laws of the
          State of Colorado under the name Ram Star, Inc. Its operations
          consisted of the assembly and sale of button control VGTs
          predominantly to the amusement industry. Sales to the gambling
          industry commenced in 1993. The Company acquired 51% of Ram Star
          effective December 31, 1994, and the remaining 49% of Ram Star was
          aquired effective January 1, 1995. Ram Star, Inc. changed its name to
          Thunderbird Greeley Inc. on June 21, 1996.
          
          In 1998, as part of its effort to cut costs, the
          Company assessed the costs involved in assembling its gaming machines
          and determined that the costs of assembling "in-house" exceeded the
          costs to outsource the assembly.
          
          Button control and touch screen VGTs for the gaming
          industry were sold by Thunderbird Greeley to independent third parties
          and other Thunderbird entities. Prior to 1998, a significant portion
          of these gaming machines were installed into Native casinos in
          California. In order to target and service this key market better,
          Thunderbird Greeley opened a servicing branch warehouse in Temecula,
          California in the second quarter of 1996. On August 21, 1998, the
          Company sold all the assets of the Temecula service center, including
          inventory, to a third party. The Temecula facility was also turned
          over to the same third party.
          
          During 1996, Thunderbird Greeley formed a joint
          venture with Viejas to install up to 500 VGTs on a revenue
          participation basis at a new casino in California north of San
          Francisco. The casino is being operated by the Hopland Band of Pomo
          Indians and commenced business in August 1996. As of December 31,
          1999, approximately 304 VGTs have been placed in the casino by the
          joint venture. All proceeds from the joint venture's portion of
          operations of the gaming terminals were being split as to 50% each by
          Viejas and Thunderbird Greeley based on an oral agreement between the
          two joint venture partners. As of May 13, 1998, the Company ceased
          receiving revenue from this non-compacted California Native American
          tribe.
          
          As of January 1, 2000, ITGS assigned Thunderbird
          Greeley its rights in the revenue share contract with the Table
          Mountain Tribe. Thunderbird Greeley continued to collect revenues
          under this contract until first quarter 2001.
          In August 2001 Thunderbird Greeley entered into a
          revenue share agreement with EDM-Reynosa.
          
          The following is a breakdown of Thunderbird Greeley's
          revenues:






Revenues of Thunderbird Greeley
          Year Ended 
                 
          December 31, 
                 
          2002
          Year Ended 
                    
          December 31,
                     
          2001
          Year Ended 
                   
          December 31, 
                   
          2000Revenue sharing revenue (continuing operations):
          $12,000
          $109,000
          $344,000VGT sales revenues (discontinued operations):
          ---
          ---
          ---Total:
          $12,000
          $109,000
          $344,000Calsino, Inc.
          
          
          Pursuant to a share purchase agreement effective
          October 10, 1997, the Company acquired 90% of the issued and
          outstanding common shares of Calsino, Inc., a manufacturer of
          electronic signs, with a 12,000 square foot manufacturing facility in
          Santee, California. In May of 1998, Calsino opened a commercial sign
          division with a sales and marketing office located in Kansas City,
          Missouri. In the fourth quarter of 1998 the Company determined it to
          be cost effective to outsource its fabrication and installation
          activities. As a result, the Company shut down its manufacturing
          facility in Santee and moved its sales and marketing staff to the San
          Diego corporate headquarters during the first quarter of 1999. On May
          1, 1999 the Company acquired the remaining 10% interest in Calsino,
          Inc.
          
          In June 1999, Calsino acquired the U.S. and Central
          American distribution rights for a mechanical card shuffler
          manufactured by a third-party Australian company.
          
          In May 2000, due to poor sales performance and lack of
          profitability, the Company entered into an agreement with the above,
          third-party Australian company to relinquish the distribution rights
          of the mechanical card shuffler. In exchange for the Company's
          efforts, the Australian company has agreed to pay a royalty to the
          Company on all machines sold in the former areas held. The royalty
          will be paid at a rate of $500 per machine for the first 800 machines
          sold in those regions that the Company had originally held
          distribution rights. In May 2001, the third-party Australian company
          entered into various agreements with Shuffle Master, Inc ("SM")
          whereby SM acquired certain assets and assumed certain liabilities of
          the third-party Australian company. The Company is currently engaged
          in discussions with SM to determine whether SM assumed the third-party
          Australian company's liability with respect to the aforementioned
          royalty arrangement. In May 2002 the Company received a settlement
          payment from SM of $150,000. The Company does expect to receive any
          more monies from this transaction
          
          On October 1, 2000 the Company's interest in the
          signage business was sold to the management of Calsino in exchange for
          a five-year note receivable for $266,000, bearing interest at 15% per
          annum, secured by the assets of the signage business.
          
          The following is a breakdown of Calsino's revenue:






Revenues of Calsino
          Year Ended
                       
          December 31, 
                       
          2002
          Year Ended
                       
          December 31, 
                       
          2001
          Year Ended
                      
          December 31, 
                      
          2000Signage and equipment:
          $               
          n/a
          $              
          n/a
          $1,004,000






International Thunderbird Gaming (Panama) Corporation
          
          
          In January 1998 the Company's Panamanian subsidiary,
          International Thunderbird Gaming (Panama) Corporation ("Thunderbird
          Panama"), which was incorporated on November 25, 1996 under the laws
          of the Republic of Panama, was awarded a renewable 20-year concession
          to operate casinos in the Republic of Panama.
          
          The Company's bid of US$3.55 million was the winning
          bid for the Group "A" package of five casinos in Panama and was
          therefore awarded this concession by the Government of the Republic of
          Panama to operate these casinos. Fifty percent of the bid price was
          advanced to the Company in the form of an arm's length Panamanian
          third-party loan that was converted to a 50% equity interest in the
          Panamanian subsidiary.
          
          The Company's 50% interest in the revenues of Panama
          is as follows:Revenues of Thunderbird Panama
          Year Ended 
                    
          December 31, 
                    
          2002
          Year Ended 
                            
          December 31,
                            
          2001
          Year Ended 
                      
          December 31, 
                      
          2000Casino Operations:
          $14,717,000
          $13,253,000
          $14,379,000During 1998, the Company developed and opened four properties in the
          Republic of Panama. On August 23, 1998 the El Soloy Hotel Casino was
          opened. It is located in Panama City. On September 7, 1998 the El
          Panama Hotel Casino was opened in Panama City. On October 18, 1998 the
          Washington Hotel Casino was opened in Colon, Panama. On December 13,
          1998 the Nacional Hotel Casino was opened in David, Panama.
          
          The existing operations in Panama expanded in 1999
          with the four casinos expanding their cumulative area from 1,860 to
          2,865 square meters, increasing the number of positions at table games
          from 295 to 339 and increasing the number of slot and video lottery
          terminals ("VLT's") from 424 to 537. Net win per machine in Panama has
          remained constant despite the significant increase in the number of
          machines. The Company has also developed of a VIP lounge in the El
          Panama property in Panama City.
          
          On December 1, 2000 the Company opened a fifth casino
          on the Island of Contadora off the coast of Panama within the
          Contadora Hotel. During 2001, due to a lack of business the Company
          closed this casino.
          
          The Guayacanes Casino opened in August 2002 and
          Decameron initiated operations in April 2003.
          
          The following table summarizes the size and number of
          gaming positions currently available at each casino:






El Panama Casino
          Soloy
          Casino
          Washington 
          Casino
          Nacional 
          Casino
          Guayacanes
          Casino
          Decameron
          CasinoTable games:Black Jack
          70
          28
          28
          28
          14
          21Roulette
          18
          6
          12
          12
          6
          12Baccarat
          32
          ---
          9
          7
          14
          14Craps
          16
          ---
          ---
          ---
          ---
          ---Fiesta Poker
          21
          7
          14
          14
          ---
          ---Total table positions
          157
          41
          63
          61
          34
          47Slot machines
          320
          193
          97
          119
          64
          50Square meters
          2,100
          325
          710
          630
          230
          682




Marketing and Competition
          
          
          Although the six casinos in Panama are located in
          large hotels and do benefit from some tourist traffic, the overall
          customer base is primarily made up of the local population. Marketing
          for the most part focuses on this local population and utilizes
          newspapers, local radio and television, billboards, direct mail and
          special events (tournaments and give-a-ways) to attract customers.
          
          Including Thunderbird Panama, there are five major
          gaming companies in Panama. Crown Casinos operates three casinos in
          Panama City, which in aggregate consist of approximately 50 table
          games and 300 slot machines. Gaming and Services Corporation operates
          approximately 14 slot parlors throughout Panama City. Lucky Games
          operates several slot parlors, which in aggregate, consist of
          approximately 400 to 500 slot machines. Equus Gaming Corporation
          operates a racetrack.
          
          Thunderbird de Guatemala, S.A.
          
          
          In September of 1997, the Company entered into an
          agreement with Public Gaming Research Institute, Inc. ("PGR") and its
          wholly owned subsidiary, Institute for the Lotteries of Latin America
          and the Caribbean ("ILAC") to supply and manage up to 2,000 gaming
          machines for gaming facilities in Central America. PGR, through ILAC,
          has been issued a license to operate gaming establishments, and PGR
          selected the Company to supply machines under a revenue sharing
          agreement for a term of five years. Operations commenced in February
          1998. This operation has successfully defended against regulatory and
          legal action initiated by the federal government in Guatemala. Final
          appeals were heard during 2000 and the Company enjoys regulatory
          tranquility in Guatemala.
          
          The Company completed arbitration proceeding against
          its partner ILAC and was awarded $161,000. In addition, a new contract
          with ILAC was entered into for 7 years beginning March 15, 2003. The
          Company will be entitled to 65% of revenue and will be responsible for
          100% of the operating expenses while ILAC and the Pediatric Foundation
          share the remaining 35% of the revenues.
          
          Thunderbird Guatemala's revenues are as follows:




Revenues of Thunderbird de Guatemala
          Year Ended 
       December 31, 
       2002
          Year Ended 
              
          December 31, 
              
          2001
          Year Ended 
              
          December 31, 
              
          2000Revenue Sharing revenues:
          $1,076,000
          $1,130,000
          $1,080,000Casino Operations
          686,000
          515,000
          369,000Total:
          $1,762,000
          $1,645,000
          $1,449,000Marketing and Competition
          
          
          Operations commenced on February 4, 1998 at the Camino
          Real Hotel, Guatemala City's premier hotel. The facility is 700 square
          meters and houses 255 video gaming machines. As in Panama, Thunderbird
          Guatemala's customer base is predominantly made up of the local
          population. The Company engages in a relatively modest marketing
          effort. This facility is the only government sanctioned video lottery
          operation in the country. The only other gaming operation is one large
          bingo parlor.
          
          Fiestacasinos.com
          
          
          In March 2000, the Company, through its subsidiary
          Fiestacasinos.com, entered into an agreement with Cryptologic's
          subsidiary, Intertainet Overseas Licensing Limited (IOLL), in which
          IOLL provides its Internet gaming software and support services to
          Fiestacasinos.com. Operations began in June 2000, with all U.S. and
          Panamanian based customers blocked from accessing the on-line casino.
          In June 2001, the Company determined that the market for on-line
          casinos outside of the U.S. and Panama was not sufficient to support
          the business. The Company has sold the subsidiary to a third party
          willing to take U.S. and Panamanian based customers. The following is
          a breakdown of the revenues of Fiestacasinos.com:






Revenues of Fiestacasinos.com
          Year Ended 
                      
          December 31, 
                      
          2002
          Year Ended 
                       
          December 31, 
                       
          2001
          Year Ended 
                     
          December 31,
                     
          2000Casino Operations:
          $           
          n/a
          $       45,000
          $        22,000The on-line casino targeted Spanish-speaking players throughout the
          world, with the exception of the U.S. and Panama. Marketing of
          Fiestacasinos.com is achieved in a two-fold approach. The Company
          contracted with a Mexico-based media provider. The contract called for
          in exchange for a percentage of the profit the media provider
          advertised the web-site on its cable network and print media. The
          second method was the use of on-line affiliates where the affiliate
          was paid a percentage of the profits generated from players who they
          direct to Fiestacasinos.com's home page.
          
          Thunderbird De Nicaragua
          
          
          During 2000, the Company, through its subsidiary
          Thunderbird De Nicaragua, leased space under a five-year lease, with
          an option for another five years in the Hotel Intercontinental,
          Managua, Nicaragua, and commenced demolition and renovation. The
          casino opened in February 2001 with 77 table positions and 37 machines
          in operation. At the end of December 31, 2002, the Company owned a
          direct 74% interest in the subsidiary and an additional 5% interest
          through Thunderbird Panama, for a combined ownership interest of 79%.
          In March 2003, the Company merged its operation with Hopewell Ltd's
          Pharaoh's Casino and now owns a 21% share in the merged operation.






Revenues of Thunderbird De Nicaragua
          Year Ended 
                     
          December 31, 
                     
          2002
          Year Ended 
                            
          December 31, 
                            
          2001
          Year Ended 
                     
          December 31, 
                     
          2000Casino Operations:
          $2,028,000
          $1,368,000
          $ n/aThe Corporate Organization
          
          
          A. Incorporation. International Thunderbird
          Gaming Corporation ("the Company") was incorporated by registration of
          its memorandum and articles under the Company Act (British Columbia)
          on September 4, 1987 under the name "Winters Gold Hedley Ltd.". The
          Company changed its name to "Regal Gold Corporation" and consolidated
          its share capital on a 2.5:1 basis effective August 26, 1993. The
          Company subsequently changed its name to International Thunderbird
          Gaming Corporation, and updated its articles, effective June 23, 1994.
          
          The Company continued into the Yukon effective
          February 5, 1999, as approved by the shareholders of the Company on
          June 18, 1998.
          
          The Company's head and principal office is located at
          12155 Dearborn Place, Poway, California 92064. The Company's
          registered and records office and address for service in the Yukon is
          in care of its solicitors, Preston, Lackowicz & Shier, Suite 300 - 204
          Black Street, Whitehorse, Yukon, Canada Y1A 2M9.
          
          B. Subsidiaries. The Company owns and manages
          the following wholly or partially owned subsidiaries (the
          "Subsidiaries"):






Name of Subsidiary
          Percentage of
          Voting Shares
          Beneficially
          Owned or
          Controlled 
          by the
          Company
          Date of Incorporation
          Jurisdiction of IncorporationThunderbird Carolina Inc.
          100%
          Dec. 22, 1989
          North CarolinaThunderbird Gaming Inc.
          100%
          Mar. 30, 1992
          British ColumbiaThunderbird Greeley, Inc.
          100%
          Jan. 14, 1994
          ColoradoInternational Thunderbird Gaming SRL
          100%
          Mar. 7, 1996
          BarbadosThunderbird Development, Inc.
          100%
          Mar. 19, 1996
          CaliforniaInternational Thunderbird Gaming (Panama) Corp
          50%
          Nov. 25, 1996
          PanamaThunderbird (Barbados) Inc.
          100%
          Jan. 27, 1997
          Barbados537481 British Columbia Ltd.
          100%
          Feb. 27, 1997
          British ColumbiaInternational Thunderbird Gaming - Nova Scotia
          100%
          June 23, 1997
          Nova ScotiaThunderwatch Partnership
          100%
          July 2, 1997
          British ColumbiaCamino Real (BVI) Investments Ltd.
          100%
          Aug. 29, 1997
          British Virgin IslandsInternational Thunderbird (BVI) Ltd.
          100%
          Aug. 29, 1997
          British Virgin IslandsInternational Thunderbird Brazil (BVI) Ltd.
          100%
          Oct. 2, 1997
          British Virgin IslandsThunderbird de Guatemala, S.A. ("Thunderbird
          Guatemala")
          100%
          Oct. 15, 1997
          GuatemalaThunderwatch (Barbados) Inc.
          100%
          Oct. 16, 1997
          BarbadosThunderbird do Brazil, S.A.
          100%
          Oct. 30, 1997
          BrazilThunderbird Panama (BVI) I Ltd.
          100%
          Apr. 22, 1998
          British Virgin IslandsThunderbird Panama (BVI) II Ltd.
          Juegos De Mexico Inc.
          Skill Game Equipment (BVI) Limited
          Servicios De Destraza S.A.
          Casinos Pajaro Trueno, S.A
          Thunderbird De Nicaragua
          South American Entertainment Investment
          100%
          100%
          100%
          100%
          100%
          79%
          100%
          Apr. 22, 1998
          June 23, 2000
          July 14, 2000
          July 31, 2000
          Aug. 9, 2000
          Oct. 28, 2000
          Jan. 11, 2000
          British Virgin Islands
          British Virgin Islands
          British Virgin Islands
          Mexico
          Costa Rica
          Nicaragua
          British Virgin IslandsImmobiliaria Bilbao
          50%
          Jan. 8, 2001
          PanamaAll of the subsidiaries were held directly by the Company or
          indirectly through another subsidiary. None of the subsidiaries have
          any non-voting shares outstanding.
          
          C. Investments. The Company has investments in
          the following entities:






Name of Entity
          Percentage of 
          Voting Shares 
          Owned by the
          Company
          Date of Incorporation
          Jurisdiction of IncorporationEntertainmens de Mexico -Nuevo Laredo-SRL
          33.3%
          November 7, 2000
          MexicoEntertainmens de Mexico-Matamoros- SRL
          37.18%
          December 15, 2000
          MexicoEntertainmens de Mexico-Reynosa SRL
          40%
          June 5, 2001
          MexicoFiesta Casino Guayana C.A.
          36%
          April 2000
          VenezuelaProperty, Plant and Equipment
          The Company currently occupies 12155 Dearborn Place,
          Poway, California. The property currently provides office space for
          management, administration, investor relations and accounting
          employees.
          
          Thunderbird Guatemala leases space for its office
          located at Murano Center, 14th St 3-51 Zone 10, Guatemala.
          
          The Thunderbird-Panama office is located at Calle 51 y
          Aquilino de la Guardia, Panama City, Panama.
          
          Panama Leases:      Soloy
              Hotel Property
                             
              El Panama Hotel Property 
                             
              Washington Hotel Property 
                             
              Nacional Hotel Property 
                             
              Guayacanes Hotel Property
          
          The Thunderbird Nicaragua office is located at Hotel
          Intercontinental Managua, Octava Calle Suroeste No. 101, and P.O. Box
          3278, Managua, Nicaragua.
          
          Nicaragua Lease:   Hotel
              Intercontinental Managua Property
          
          In the aggregate, the financial commitment for the
          leases for the twelve months ended December 31, 2002 is $2,233,000.
          
          The following table summarizes the size and number of
          gaming positions currently available at each casino:






El 
             Panama
             Casino
          Soloy 
         Casino
          Washington 
   Casino
          Nacional 
          Casino
          Guayacanes
  Casino
          Decameron
    CasinoTable games:Black Jack
          70
          28
          28
          28
          14
          21Roulette
          18
          6
          12
          12
          6
          12Baccarat
          32
          ---
          9
          7
          14
          14Craps
          16
          ---
          ---
          ---
          ---
          ---Fiesta Poker
          21
          7
          14
          14
          ---
          ---Total table positions
          157
          41
          63
          61
          34
          47Slot machines
          320
          193
          97
          119
          64
          50Square meters
          2,100
          325
          710
          630
          230
          682




Thunderbird de Nicaragua leases space under a
          five-year lease, with an option for another five years in the Hotel
          InterContinental, Managua, Nicaragua. The operation has 14 black jack
          positions, 35 Fiesta poker positions, 12 roulette positions and 45
          slot machines in the 300 square meter facility.
          
          Item 5
          - Operating and Financial Review and Prospects
          
          
          The application of U.S. GAAP differs from results
          applied under Canadian GAAP as set forth in Note 23 to the
          Consolidated Financial Statements of the Company.
          
          Critical accounting policies:
          
          
          
          The preparation of financial statements in conformity
          with generally accepted accounting principles requires us to make
          estimates and assumptions that affect the reported amounts of assets
          and liabilities, the disclosure of contingent assets and liabilities
          at the date of the financial statements and the reported amounts of
          revenues and expenses during the reporting periods. As described
          below, significant estimates are used in determining the application
          of the going concern concept, allowance for doubtful accounts and the
          useful lives of capital assets. We evaluate our estimates on an
          ongoing basis, including those related to bad debt, investments,
          capital assets, income taxes and contingencies and litigation and
          other contingencies. We base our estimates on historical experience
          and on various other assumptions that are believed to be reasonable
          under the circumstances, the results of which form the basis for
          making judgments about carrying values of assets and liabilities that
          are not readily apparent from other sources. Actual results may differ
          from these estimates under different assumptions or conditions.
          
          We believe the following critical accounting policies
          affect our more significant judgments and estimates used in the
          preparation of our financial statements:
          
          Amounts receivable:
          
          Amounts receivable include of the following:


2002
          2001Costs recoverable from third party participation in
          Guatemalan operation (a)
          161
          530Apuestas Continentales, S.A. (b)
          408
          408Tristar Media, Inc. (c)
          -
          335Fiesta Juegos de Costa Rica (d)
          269
          269Hopland Band of Pomo Indians (e)
          625
          -(a)     Costs recoverable from
          third party participant in Guatemalan operation:
          The Company was eligible to recover leasehold
          improvement costs incurred for the Guatemalan operations from a third
          party participant in the Guatemalan revenue and net profit sharing
          agreement ("Profit Share Agreement"). The amounts were collectible on
          a monthly basis from the third party's share of revenue and net
          profits from the operations. The costs recoverable were non-interest
          bearing. During fiscal 2000, the third party ceased reimbursing these
          costs and was disputing eligibility for reimbursement of certain of
          these costs under the agreement. An arbitration proceeding concerning
          this dispute was completed in March 2002. At December 31, 2002, the
          amounts were written down by $369,000 to the amount awarded by the
          arbitrator of $161,000. In addition to the Company's claim for
          reimbursement of the leasehold improvement costs, the Company claimed
          in the proceeding that the expiration of the Profit Share Agreement,
          entered into in October 1997, should be extended past the five year
          contract term of October 2002 as operations did not commence until
          February 1998. The arbitrator in his ruling decided in favor of the
          Company with regard to the extension.
          
          (b)   Apuestas
          Continentales, S.A.:
          
          The Company has a promissory note dated March 1, 2000
          for the sale of gaming machines to Apuestas Continentales, S.A.
          ("Apuestas"). The note is non-interest bearing, with 24 monthly
          payments of $22,000 beginning April 1, 2001 and maturing on March 1,
          2003. Apuestas has not made any payments as required under the terms
          of the note during fiscal 2002 or 2001. The Company entered into
          discussions with Apuestas as payments have not been received as
          required under the terms of the note and is actively pursuing various
          options to collect the remaining balance owing under the note. If the
          Company is not able to collect the outstanding balance, a provision
          will be required for the excess.
          
          (c)    
          Tristar Media, Inc. (successor to Sing Security Services, Ltd.):
          
          On June 30, 2001, the Company sold its internet gaming
          business, FiestaCasinos.com, to Sing Security Services Ltd. for
          proceeds consisting of a $340,000 note receivable and the assumption
          of a related liability in the amount of $70,000, resulting in a gain
          of $208,000. The note receivable bears interest at 10% and requires
          monthly payments of interest of $2,333 commencing July 31, 2001
          through to December 31, 2001, and monthly payments of principal and
          interest of $7,224 from January 31, 2002 through to December 31, 2006.
          The note receivable is secured by the shares of FiestaCasinos.com. In
          addition, under the terms of the sale, the Company has the right until
          June 30, 2006 to buy-back a 50% interest in FiestaCasinos.com at a
          price based on FiestaCasinos.com's current earnings before interest,
          taxes, depreciation and amortization. During the year ended December
          31, 2002, the Company established a reserve against the receivable as
          a result of the FiestaCasino.com's future operations will impact the
          value, if any, of this buy-back option.
          
          (d)    
          Fiesta Juegos de Costa Rica S.A.:
          
          On August 23, 2001, the Company sold its gaming
          subsidiary, Fiesta Juegos de Costa Rica S.A. ("Fiesta Juegos"), to a
          third party for proceeds consisting of a note receivable for $269,000,
          resulting in a gain on sale of $203,000 which has been deferred at
          December 31, 2001. The gain will be recognized in income as the note
          receivable is collected. The note receivable bears interest at 12%,
          with monthly payments consisting of 25% of the net income from the
          operations of Fiesta Juegos, beginning the earlier of 45 days after
          Fiesta Juegos achieves positive cash flows from operations or November
          1, 2001. In 2002, the Company entered into discussions with the
          purchaser of Fiesta Juegos as payments have not been received as
          required under the terms of the note. The outcome of these
          discussions, which is not determinable at this time, could impact the
          carrying value of the note receivable and other amounts reported in
          the consolidated financial statements.
          
          (e)    
          Hopland Band of Pomo Indians
          The Company previously entered into various agreements
          for the financing, design and construction of a gaming facility on the
          Hopland Indian Reservation ("Hopland") which included a one-half
          interest in a Gaming Hardware Lease Agreement (the "Lease"). Pursuant
          to a settlement agreement dated May 31, 2002, Hopland agreed to pay
          the Company $750,000 in satisfaction of all obligations owing under
          the Lease and accordingly, the Company recorded a recovery of
          $750,000. The amount receivable from Hopland bears interest at 12% per
          annum and is repayable in monthly instalments of $24,900.
          
          Going Concern:
          
          
          These consolidated financial statements have been
          prepared on a going concern basis in accordance with Canadian
          generally accepted accounting principles, which assumes that the
          Company will continue in operation for the foreseeable future and be
          able to realize its assets and discharge its liabilities and
          commitments in the normal course of business. However, the Company has
          incurred significant losses to the year ended December 31, 2001, has a
          working capital deficiency at December 31, 2002 of $2,806,000 (2001 -
          $3,081,000) and has recently had to seek a waiver from its primary
          lender relating to covenant violations on certain borrowings as at
          December 31, 2002 (see Note 9 to Audited Financial Statement - loans
          payable).
          
          During the year ended December 31, 2001, Fiesta
          Casinos Guayana, C.A. ("Fiesta Casinos Guayana"), the Venezuelan
          company in which the Company has an equity interest, may have been
          subjected by the National Casinos, Bingo Parlors and Slot Machines
          Commission of Venezuela (the "Commission") to penalties and fines
          because it transferred all of its shares to a national financial
          institution as security, thereby violating certain provisions of the
          Control of Casinos, Bingo Parlors and Slot Machines Act. On December
          21, 2001, in response to Fiesta Casinos Guayana's request for
          authorization to keep the security in force, the Commission asked the
          Company to add a clause to the final loan contract stipulating that
          Fiesta Casinos Guayana must obtain prior authorization from the
          Commission to proceed to judicial sale or undertake any other legal
          transaction which implies transfer of ownership of the shares put up
          as security, initially or as a result of a capital increase by Fiesta
          Casinos Guayana. Fiesta Casinos Guayana had not made the change in the
          final loan contract required by the Commission and had not made any
          provisions in its financial statements at December 31, 2001 for any
          possible penalties and fines relating to this issue. During the
          current year the loan was paid in full and consequently the Company is
          no longer in violation as at December 31, 2002.
          
          Since July 2001, the Company has been working to
          develop future profitable operations and improve the working capital
          position of the Company. During the year ended December 31, 2001, the
          Company refocused its efforts toward the operation and profitability
          of current facilities as opposed to the development of new facilities.
          As a result, the Company reduced its development and support staff and
          related expenses. In addition, the Company reduced its staff levels in
          the Republic of Panama and refinanced a portion of its debt during the
          year.
          
          The ability of the Company to continue as a going
          concern and to realize the carrying value of its assets and discharge
          its liabilities when they become due is dependent on the success of
          its core operations. Management believes that the core operations, in
          conjunction with the expected increase in profits from the Company's
          investments in Venezuela and Nicaragua, which commenced operations in
          the year ended December 31, 2001, will mitigate the adverse conditions
          and events which raise doubt about the validity of the going concern
          assumption used in preparing these financial statements.
          
          During 2001, the Mexican government closed the skill
          game facilities in Matamoros, Nuevo Laredo and Reynosa, Mexico in
          which the Company has an equity interest, alleging the operations are
          in violation of the law. The Company is currently pursuing a claim
          under section 11 of the North American Free Trade Agreement.
          The auditor's report on the Company's December 31,
          2002 financial statements includes additional comments that state that
          the financial statements are affected by conditions and events that
          cast doubt on its ability to continue as a going concern. The
          financial statements do not include any adjustments that may result
          from the outcome of that uncertainty
          
          Capital assets:
          
          
          At December 31, 2002, the Company has $7,826,000 (2001
          - $6,512,000) in carrying value of fixed and intangible assets.
          Intangible assets primarily relate to the gaming license for Panama.
          Management of the Company periodically assesses the amortization
          periods and potential for impairment in the carrying value of theses
          assets after consideration of expected future use and utilization,
          projected cash flows and other indicators of value. When the fair
          value of the specific asset is less than the carrying value, an
          impairment charge is recorded for the differences. In the future,
          events or conditions could arise that are outside of the Company's
          control, including changes in economic environments, competition,
          customer demands and regulations which could impact such assets fair
          value. In addition, changes in management's business objectives or
          plans could also result in an impairment charge.
          
          Operations:
          
          
          A. Selected Consolidated Financial Information.
          The tables set out below set forth selected consolidated financial
          data. Such data is derived from the consolidated financial statements
          of the Company, which have been audited by Davidson & Company,
          Chartered Accountants, for 2002 and KPMG LLP for 2001 and 2000.
          
          The selected financial data should be read in
          conjunction with the Consolidated Financial Statements of the Company
          and the Notes thereto.
          
          The Consolidated Financial Statements of the Company
          have been prepared in accordance with accounting principles generally
          accepted in Canada ("Canadian GAAP"). (All in US $000's except
          earnings per share)






Audited (1)
          Fiscal Year ended December 31For the Period:
          2002
          2001
          2000Revenue:
          18,519
          16,420
          16,194Net earnings: (loss)
          324
          (3,080)
          (1,291)Earnings (loss) per share
          0.01
          (0.13)
          (0.06)(Basic):End of period working
          capital: (deficiency)
          (2,806)
          (3,081)
          (2,102)Total assets:
          14,553
          13,799
          13,789Long term debt (2):
          4,232
          4,296
          1,896Total liabilities:
          13,066
          12,766
          9,733Share capital (3):
          21,085
          21,089
          21,032Foreign exchange adjustment
          (277)
          (411)
          (411)Deficit:
          (19,321)
          (19,645)
          (16,565)Under Canadian GAAP.
            Excludes the current portion of the long-term debt.
            The Company has only one kind and class of shares
            issued and outstanding, being common shares.






No dividends were paid during the periods reported
          above.
          
          B. Comparison of Results of Operations - Fiscal
          Year ended December 31, 2002 Compared to Fiscal Year Ended December
          31, 2001.
          
          Revenues for the year 2002 from continuing operations
          were $18.5 million, an increase of 13% over 2001 revenues from
          continuing operations of $16.4 million.
          
          Net earnings for the year were $324,000 compared with
          a loss of $3.1 million in 2001. General and Administrative expenses
          decreased 6% from $7.4 million in 2001 to $7.0 million in 2002. The
          decrease in G&A expenses reflects cost savings from reduced payroll,
          staff, audit fees and corporate rent.
          
          In 2002, the Company incurred a total of $745,000 in
          income taxes compared with $791,000 in 2001. The increase in the
          expense for depreciation is directly related to the increased capital
          assets associated with the expansion in Panama.
          
          In 2002, the Company achieved EBITDA before
          discontinued operations (Earnings Before Interest, Taxes, Depreciation
          and Amortization) of $3.9 million or $0.17 per share, compared to $1.3
          million or $0.05 per share in 2001. The growth in EBITDA is a result
          primarily of increased revenues. Earnings per share from continuing
          operations were $0.01 in 2002 compared to a loss of $0.08 in 2001.
          
          Cash provided by continuing operations increased to
          $2.8 million for the year ended December 31, 2002 from $2.1 million
          for the year ended December 31, 2001. The Company's cash flow from
          operations consists primarily of cash flows from its joint venture
          interest in the Panama Fiesta Casinos and Guatemalan revenue sharing
          arrangements. Cash and cash equivalents decreased to $1.2 million at
          December 31, 2002 from $1.5 million at December 31, 2001. The working
          capital deficiency of $3.1 million at the end of 2001 has been reduced
          to $2.8 million at the end of 2002. The decrease in the deficiency is
          due, in part, by renegotiating debt, moving portions to long term, and
          collecting certain receivables, which were previously classified as
          long term. Total long-term debt and capital lease obligations at
          December 31, 2001 were $4.3 million and has decreased to $4.2 million
          at December 31, 2002. The reason for such an insignificant change is
          due to additional debt incurred in Panama to finance that expansion.
          During the year ended December 31, 2002, the Company renegotiated the
          terms of two of its loans in which it was previously in arrears and/or
          in default, such that at December 31, 2002, the Company is no longer
          in arrears in payments or in default in respect of any loans.
          
          C. Comparison of Results of Operations - Fiscal
          Year ended December 31, 2001 Compared to Fiscal Year Ended December
          31, 2000.
          
          Revenues for the year 2001 from continuing operations
          were $16.4 million, an increase of 1.4% over 2000 revenues from
          continuing operations of $16.2 million.
          
          Net loss for the year 2001 was $3.1 million compared
          with a loss of $1.3 million in 2000. The loss for 2001 included a loss
          from equity in associated companies of $1.4 million; this loss is
          related to Mexico and Venezuela, as disclosed in Note 5 of the
          financial statements. The 2001 year-end loss also included a loss from
          discontinued operations related to product sales, including signage,
          of $1.2 million as compared to a loss of $662 thousand in 2000.
          General and Administrative expenses increased 28.3% from $5.8 million
          in 2000 to $7.4 million in 2001. The growth in G&A expenses reflects
          expenses incurred in Nicaragua and additional locations in Mexico
          beyond our locations in the cities of Matamoras, Nuevo Laredo and
          Reynosa. Depreciation and Amortization expenses increased 13.2% from
          $1.1 million in 2000 to $1.3 million in 2001, which is due to a full
          year of expense from the Nicaragua operation and the addition of the
          office building through Inmobiliaria in Panama.
          
          In 2001, the Company incurred a total of $791 thousand
          in income taxes compared with $1.5 million in 2000.
          
          The loss per share before discontinued operations was
          $0.08 in 2001, $0.13 after discontinued operations, compared with a
          loss per share before discontinued operations of $0.03 in 2000, $0.06
          after discontinued operations.
          
          In 2001, the Company achieved EBITDA before
          discontinued operations (Earnings Before Interest, Taxes, Depreciation
          and Amortization) of $1.3 million or $0.05 per share, compared to $3.2
          million or $0.14 per share in 2000.
          
          The working capital deficiency of $2.1 million at the
          end of 2000 has increased to $3.1 million at the end of 2001. The
          increase in the deficiency is due, in part, by the Company funding its
          investment in the associated companies out of its operating cash
          flows, the write off of certain Amounts Receivable from the 2000
          balance sheet and the reclass of certain Amounts Receivable from
          current, in year 2000, to long term in year 2001 based on uncertainty
          as to when payments will be received. Total debts of the Company,
          including working capital deficiency, capital lease obligations, loans
          payable, and future income taxes, have increased from $4.7 million in
          2000 to $8.2 million in 2001. The change relates to the increases in
          the working capital deficiency and loans payable.
          
          D. Effect of Recent Developments on Operations
          
          1. Nicaragua Merger. Thunderbird's Fiesta
              Casino-Managua is steadily improving in its revenue results
              following the Company's merger with Hopewell Ltd. The merger was
              completed on March 1, 2003.
              2. Guatemala. The Company entered into a
              7-year agreement with ILAC and FPG in which the Company will
              continue to operate the Lotteria at the Camino Real Hotel in
              Guatemala City, Guatemala. The Company will receive 65% of the
              revenue and will be responsible for all operating expenses.
              3. Venezuela. The Company is concerned over
              the recent political issues in Venezuela. The Company will
              continue to monitor the situation to determine the effect of
              Venezuela's recent political problems on the operation.
              4. Mexico. The Company's Mexico Operations
              were shut down by Gobernacion on October 11, 2001. The Company is
              currently litigating a NAFTA claim against the government of
              Mexico. Management believes this litigation will be protracted
              because of past and continued stonewalling by the Mexican
              government. The Company has a trial date of April 2004. At this
              point, the Company is in the midst of exchanging documents through
              the arbitration process. Another Mexican skill game operator
              continues to operate without any hindrance from the Mexican
              government.
              5. Recovery of Disposition of Discontinued
              Operations. The Company finalized and settled all of its
              claims against California tribes and collected receivables
              stemming from discontinued operations.E. Capital Resources and Liquidity. Cash
          provided by continuing operations increased to $2.8 million for the
          year ended December 31, 2002 from $2.1 million for the year ended
          December 31, 2001. The Company's cash flow from operations consists
          primarily of cash flows from its joint venture interest in the Panama
          Fiesta Casinos and Guatemalan revenue sharing arrangements. Cash and
          cash equivalents decreased to $1.2 million at December 31, 2002 from
          $1.5 at December 31, 2001. The working capital deficiency of $3.1
          million at the end of 2001 has been reduced to $2.8 million at the end
          of 2002. The decrease in the deficiency is due, in part, by
          renegotiating debt, moving portions to long term, and collecting
          certain receivables, which were previously classified as long term.
          Total long-term debt and capital lease obligations at December 31,
          2001 were $4.3 million and has decreased to $4.2 million at December
          31, 2002. The reason for such an insignificant change is due to
          additional debt incurred in Panama to finance that expansion. During
          the year ended December 31, 2002, the Company renegotiated the terms
          of two of its loans in which it was previously in arrears and/or in
          default, such that at December 31, 2002, the Company is no longer in
          arrears in payments or in default in respect of any loans
          
          The Company raised $5,000 during the year ended
          December 31, 2002 by way of issuance of shares on exercise of options.
          
          The Company anticipates paying its obligations and
          working capital deficiency from cash flow generated from operations
          and collection of amounts receivable and recoverable. The Company
          currently does not plan to raise capital by the issuance of shares in
          the near future.
          
          As of December 31, 2002, the Company had outstanding
          share options exercisable for up to 4,087,614 common shares at prices
          ranging from CDN$0.08 to CDN$1.25 per share. If all share options are
          exercised, to which no assurance can be given, 4,087,614 common shares
          would be issued generating proceeds of CDN$1,856,474.
          
          Material Commitments for Capital Expenditures
          
          
          The Company through its 36% effective equity
          investment in Fiesta Casinos Guayana is in the process of building out
          a 20,000 square foot Events Center in the InterContinental Hotel
          Guayana. The Events Center shall have a dual purpose: (1) to enhance
          Hotel marketability and (2) to host casino special events, concerts
          and sporting events. The total capital expenditures for this project
          are estimated to be $2,758,000 and at the time of this filing
          approximately $1,200,000 is still required. The source of the funds to
          build out the location is through investor contributions and financing
          secured with a bank in Venezuela.
          
          In June 2002, Thunderbird Panama began an expansion of
          its casino in the El Panama Hotel. This expansion when completed will
          add approximately 1,000 square meters of gaming and entertainment
          space including 120 new slot machines, 5 table games and a facility
          for live music and shows. In addition, the existing bar will be
          converted to a restaurant. The expansion also includes the addition of
          a Race and Sports betting facility. The total capital expenditures for
          this project are estimated to be $3,000,000. The source of the funds
          to complete this project will come from financing secured with a bank
          in Panama.
          
          Research and Development:
          
          
          The Company expenses all development costs as they are
          incurred. These costs relate to the identification of gaming locations
          and development of the locations prior to opening. For the year ended
          December 31, 2002, the Company expensed $267,000. For the year ended
          December 31, 2001, the Company expensed $1,573,000, including amounts
          reflected in the loss from associated companies. For the year ended
          December 31, 2000 the Company expensed $1,316,000.
          
          Item 6 -
          Directors, Senior Management and Employees
          
          
          The following is a list of the current directors and
          senior officers of the Company, their municipalities of residence,
          their current positions with the Company and their principal
          occupations during the past five years.


Name and Municipality
          Of Residence
          Principal Occupation for Previous Five YearsJack R. Mitchell (1)
          Panama City, Panama
          President, Chief Executive Officer and Director
          President and Chief Executive Officer of the Company
          since April 1997; Partner, Mitchell & Skola from 1986 to March 1997, a
          law firm in San Diego, California.Albert W. Atallah 
          El Cajon, California USA
          General Counsel and Director
          General Counsel to the Company since July 1997;
          Private practice in California and Michigan from 1981 to present;
          Certified Tax Specialist; LLM Taxation; BBA University of Michigan.Clay Hardin
          Estes Park, Colorado USA
          Vice President-Operations
          Vice President, Operations of the Company since April
          1997; President, Gaming Resources International, Inc. from October
          1995 to March 1997.Booker T. Copeland III
          Oceanside, California USA
          Chief Financial Officer
          Corporate Secretary
          Senior Accountant at Burnham & Company in San Diego
          since 1998; Corporate Accounting Manager to the Company from 1999 to
          2001; Corporate Controller from 2001 to 2002; Chief Financial Officer
          and Corporate Secretary since October 2002Jorge Montano
          Mexico City, Mexico
          Director
          President of CW/Latin America Partners, LLC as well as
          Asesoria y Analysis S.A. de CV from 1995 until 2001; Director since
          June 2000Jean Duval (1)
          Carnigan, Quebec, Canada
          Director
          Vice-President of XTL Transport in Ontario from 1990
          to 2001; Vice-President of STCH in Quebec from 2001 to the present;
          Director since June 2002Salomon Guggenheim (1)
          Baech, Switzerland
          Director
          Managing Director with Rabo Investment Management Ltd.
          In Zurich from 1987 to Dec. 2001; self-employed since January 2002;
          Director since June 2002Member of the Company's Audit Committee.
            The directors of the Company received $10,000 in 2002 and $8,000
            in 2001, as cash compensation for their services as directors.
            Directors are eligible to receive stock options pursuant to the
            Company's stock option plan. See "Principal Holders of Securities"
            for particulars of the shares and stock options held by the
            directors and senior officers.Appointment of Directors
          
          
          The Articles of Continuance of the Company provide for
          a minimum of three (3) and a maximum of seven (7) directors. The
          numbers of directors proposed to be elected at the Meeting are two
          (2).
          
          Pursuant to the amendment to the articles of the
          Company (allowing for staggered terms), following the 2001 Annual and
          Special Meeting, directors of the Company served for various one, two
          and three year terms. Dave Michelson was elected for a one-year term
          expiring at the 2003 Annual General Meeting of Shareholders (AGM) but
          resigned his position immediately following the 2002 AGM and was
          replaced by Jean Duval who is up for election to serve a one-year term
          expiring at the 2004 AGM. Albert W. Atallah and Jorge Montano were
          elected to two year terms at the 2001 AGM and are now up for
          re-election to be elected for a two-year term expiring at the 2005 AGM
          or until their successors are elected or appointed. Jorge Montano is
          not seeking a re-election. The directors to be elected for a
          three-year term expiring at the 2004 AGM or until their successors are
          elected or appointed are Jack R. Mitchell and Salomon Guggenheim.
          
          Jorge Montano's board seat will remain vacant until
          after this years AGM. The newly constituted board of directors will
          fill this seat with a selection of an unrelated director. The articles
          of the Company permit the directors to appoint directors to fill any
          casual vacancies that may occur on the board. The articles of the
          Company also permit the directors to add additional directors to the
          board between successive annual general meetings so long as the number
          appointed does not exceed more than one-third of the number of
          directors appointed at the last annual general meeting. Individuals
          appointed as directors to fill casual vacancies on the board or added
          as additional directors hold office like any other director until the
          next annual general meeting at which time they may be reelected or
          replaced.
          
          Executive Compensation
          
          Set out below are particulars of compensation paid to
          the following persons (the "Named Executive Officers"):
          
          the Company's Chief Executive Officer;
            each of the Company's four most highly compensated executive
            officers who were serving as executive officers at the end of the
            most recently completed financial year and whose total salary and
            bonus exceeded $100,000 per year; and
            any additional individuals for whom disclosure would have been
            provided under (b) but for the fact that the individual was not
            serving as an officer of the Company at the end of the most recently
            completed financial year.
          As at December 31, 2002, the end of the most recently
          completed fiscal year of the Company, the Company had four Named
          Executive Officers: Jack R. Mitchell, the President and Chief
          Executive Officer and a director of the Company; Clay Hardin, the
          Vice-President, Operations; and Albert Atallah, Chief Operating
          Officer and General Counsel and a director of the Company, and Booker
          Copeland, Chief Financial Officer and Corporate Secretary.
          
          Summary of Compensation
          
          
          The following table is a summary of compensation paid
          to the Named Executive Officers for each of the Company's three most
          recently completed fiscal years.
          
          Summary Compensation Table








Annual Compensation
          Long Term CompensationAwards
          PayoutsName and Principal Position
          Fiscal
          Year
          End-
          ing
          Salary (1)
          Bonus (1)
          Other 
          Annual
          Comp-
          nsation 
          (1)(2)
          Securi-
          ties
          Under
          Options
          Granted
          Restrict
          -ed
          Shares
          or 
          Restrict-
          ed Share
          Units
          LTIP
          Pay-
          Outs
          All 
          Other 
          Compen-
          sation (1) (4)Jack R. Mitchell
          President and CEO and Director
          2002
          2001
          2000
          $225,000
          $225,000
          $225,000
          Nil
          $17,000
          Nil
          $2,000
          $7,000
          $2,000
          400,000
          35,000
          Nil
          Nil
          Nil
          Nil
          N/A
          N/A
          N/A
          $74,000
          Nil
          NilAlbert Atallah
          General Counsel and Director
          2002
          2001
          2000
          $150,000
          $150,000
          $123,000
          Nil
          $12,000
          Nil
          $2,000
          $7,000
          $2,000
          50,000
          130,000
          Nil
          Nil
          Nil
          N/A
          N/A
          N/A
          $62,000
          Nil
          NilClay Hardin
          Vice-President,
          Operations
          2002
          2001
          2000
          $150,000
          $150,000
          $150,000
          $45,000
          $10,000
          $15,000
          Nil
          Nil
          Nil
          100,000
          15,000
          130,000
          Nil
          Nil
          Nil
          N/A
          N/A
          N/A
          $17,000
          Nil
          NilBooker
          Copeland
          Chief Financial
          Officer and
          Corporate
          Secretary
          2002
          $95,000
          Nil
          Nil
          100,000
          Nil
          N/A
          $25,000


(1) These monies were paid in United States dollars.
          (2) These monies were paid as directors' fees.
          (3) These monies were paid in Canadian dollars.
          (4) On June 4, 2002 the company was informed of a "dissident proxy
          battle" that was planned on being filed by a group of shareholders (as
          disclosed in a Press Release). The dissidents requested board and
          officer resignations and threatened legal action. Resignations were
          offered in order to serve the best interest of the Company. After
          learning more about the difficulties of the foreign operations and
          that management would not support the group of dissidents, the
          dissidents determined not to proceed in removing directors and
          management. The compensation paid to Jack R. Mitchell, Albert W.
          Atallah, Clay Hardin and Booker Copeland was initially paid as
          severance and thereafter retained by these members of management as
          compensation to assure that the Company work out its financial
          problems and bolster its operations.
          Long-Term Incentive Plans - Awards in Most Recently
          Completed Fiscal Year
          
          The Company has no long-term incentive plans and
          therefore no awards were made under any long-term incentive plan to
          the Named Executive Officers during the Company's most recently
          completed fiscal year. A "Long-Term Incentive Plan" is a plan under
          which awards are made based on performance over a period longer than
          one fiscal year, other than a plan for options, SARs (stock
          appreciation rights) or restricted share compensation.
          Options/SARs Granted During the Most Recently
          Completed Fiscal Year
          No SARs (stock appreciation rights) were granted to
          the Named Executive Officers during the most recently completed fiscal
          year.
          
          The following table shows the stock options granted to
          the Named Executive Officers during the most recently completed fiscal
          year.
          
          Option Grants During the Most Recently Completed
          Financial Year


Name
          Date of Grant
          Securities
          Under
          Options
          Granted
          (#)
          Exercise or 
          Base Price
          (Cdn. $/ 
          Security)
          % of Total 
          Options 
          Granted to
           Employees 
          in Fiscal 
          year
          Market Value
          of Securities
          Underlying 
          Options on 
          the Date of 
          Grant (Cdn.
          $/Security)(1)
          Expiration 
          DateJack R. Mitchell
          9/18/02
          400,000
          0.09
          35%
          $36,000
          9/18/07Albert Atallah
          9/18/02
          50,000
          0.09
          4%
          $4,500
          9/18/07Clay Hardin
          9/18/02
          100,000
          0.09
          8%
          $9,000
          9/18/07Booker Copeland
          9/18/02
          100,000
          0.09
          8%
          $9,000
          9/18/07




(1) Calculated as the closing price in Canadian
          dollars of the Company's shares on The Toronto Stock Exchange on the
          date of grant.Aggregated Option/SAR Exercises during the Most Recently
          Completed Fiscal Year and Fiscal Year End Option/SAR
          Values
          The following table sets out incentive stock options
          exercised by the Named Executive Officers during the most recently
          completed fiscal year as well as the fiscal year end value of stock
          options held by the Named Executive Officers. During this period, no
          SARs were held by the Named Executive Officers.
          Aggregated Option Exercises During the Most Recently
          Completed Financial Year




Name
          Securities
          Acquired on 
          Exercise (#)
          Aggregate 
          Value 
          Realized 
          (Cdn.$)
          Unexercised
          Options at
          Fiscal Year-End
          Exercisable / 
          Unexercisable 
          #)
          Value of
          Unexercised 
          In-the-Money 
          Options at Fiscal 
          Year-End (Cdn.$) 
          Exercisable / 
          Unexercisable (1)Jack R. Mitchell
          25,494
          $0.32
          1,148,364
          0Albert Atallah
          0
          0
          512,500
          0Clay Hardin
          0
          0
          505,000
          0Booker Copeland
          0
          0
          150,000
          0




(1)
          In-the-Money Options are those where the market value
          of the underlying securities as at the most recent fiscal year end
          exceeds the option exercise price. The closing market price of the
          Company's shares as at December 31, 2002 (i.e. fiscal year end) was
          Cdn. $0.09.Option and SAR Repricings
          
          There were no options or SARs held by the Named
          Executive Officers that were repriced downward during the most
          recently completed financial year end of the Company.
          Defined Benefit or Actuarial Plan Disclosure
          The Company does not have a defined benefit/actuarial
          plan under which benefits are provided to the Company's officers and
          key employees determined by final compensation or years of service.
          Executive Compensation and Formulation of a
          Compensation Committee
          
          The Company intends to formulate a compensation
          committee comprised of two outside board of directors, Salomon
          Guggenheim and Juan Duval for the current year, but for the previous
          years, the Company's Board of Directors has administered Executive
          officer compensation on an ad hoc basis. The compensation of executive
          officers consists of a base salary and various prerequisites,
          discretionary annual bonuses and participation in the Company's common
          share option plan. The compensation of each executive officer is based
          on an assessment of the value to the Company of the officer concerned,
          the standard of performance during the past year by the officer
          concerned and the duties comprising the office.
          
          Personnel
          
          
          As at December 31, 2002, the Company, including
          Thunderbird Panama in which the Company has a 50% interest, Fiesta
          Casino Guayana, in which the Company has a 36% interest, Thunderbird
          de Nicaragua in which the Company had a 79% interest and Thunderbird
          de Guatemala, had a total of 1,188 employees. Of these 1,188
          employees, 91 employees serve in a management, operation and
          administration capacity, 1,073 employees serve in a sales and
          marketing capacity, and 24 serve in a technical support capacity.
          These employees are divided among the Company's operations as follows:






Office Location
          Mgmt. & Admin.
          Marketing & Sales
          Tech. Support
          TotalRepublic of Panama
          50
          727
          8
          785San Diego, CA
          6
          0
          0
          6Venezuela
          20
          201
          2
          223Nicaragua
          10
          87
          6
          103Guatemala
          5
          58
          8
          71Totals:
          91
          1,073
          24
          1,188






For particulars on the Company's directors and senior officers, see
          "Directors and Officers".
          
          The foregoing full and part-time personnel are sufficient to meet
          the Company's stated business objectives. Additional personnel will be
          added as and when circumstances warrant.
          
          Bonus Plans
          
          
          No employee bonus plans currently exist in the Company and any
          bonuses paid to the employees are at the discretion of management.
          These bonuses may impact on the Company's ability to pay dividends in
          the future.
          
          Item 7 - Major Shareholders and Related Party Transactions
          
          
          As of December 31, 2002, the Company had a total of 23,475,868
          common shares issued and outstanding. As of December 31, 2002, there
          were no persons and companies that owned of record or are known by the
          Company to have owned beneficially, directly or indirectly, more than
          5% of the outstanding common shares of the Company. The following
          table sets forth the beneficial ownership by all directors and
          executive officers of the Company, as a group, of outstanding common
          shares of the Company as of December 31, 2002.
          
          Name                                 
          No. Of Common Shares (1)          
          % of SharesOfficers and Directors                      
          751,965                                    
          3.2%
          
          As well, there exist stock options, held by directors and
            officers of the Company, pursuant to which up to 2,900,829 common
            shares can be purchased.
          Indebtedness of Directors and Executive and Senior Officers
          
          During the last completed fiscal year, no director, executive
          officer, senior officer or nominee for director of the Company or any
          of their associates has been indebted to the Company or any of its
          subsidiaries, nor has any of these individuals been indebted to
          another entity which indebtedness is the subject of a guarantee,
          support in agreement, letter of credit, or other similar arrangement
          or understanding provided by the Company or any of its subsidiaries,
          except as set forth below.
          The Company loaned the sum of $9,000 to Jack R. Mitchell, the
          President, Chief Executive Officer and a director of the Company. The
          loan is secured by the Company's shares and is interest bearing and
          payable on demand. The loan was made for the purpose of enabling Mr.
          Mitchell to purchase common shares of stock of the Company.
          The Company loaned the sum of $6,750 to Albert W. Atallah, Chief
          Operating Officer, General Counsel and a director of the Company. The
          loan is secured by the Company's shares and is interest bearing and
          payable on demand. The loan was made for the purpose of enabling Mr.
          Mitchell to purchase common shares of stock of the Company.
          The Company loaned the sum of $9,000 to Clay Hardin, Vice President
          of Operations. The loan is secured by the Company's shares and is
          interest bearing and payable on demand. The loan was made for the
          purpose of enabling Mr. Hardin to purchase common shares of stock of
          the Company.
          The Company loaned the sum of $4,500 to Booker Copeland, currently
          Chief Financial Officer and Corporate Secretary but Controller of the
          Company at the time the loan was made. The loan is secured by the
          Company's shares and is interest bearing and payable on demand. The
          loan was made for the purpose of enabling Mr. Copeland to purchase
          common shares of stock of the Company.
          The Company loaned the sum of $15,724 to Jack R. Mitchell, the
          President, Chief Executive Officer and a director of the Company. The
          loan was unsecured non-interest-bearing and payable on demand. The
          loan was not made for the purpose of enabling Mr. Mitchell to purchase
          securities of the Company.
          Interest of insiders in material transactions
          
          Except as disclosed herein, since the commencement of the last
          completed fiscal year, no insider of the Company, nominee for
          director, or any associate or affiliate of an insider or nominee, had
          any material interest, direct or indirect, in any transaction or any
          proposed transaction which has materially affected or would materially
          affect the Company.
          Except as disclosed herein, no person has any material interest,
          direct or indirect, by way of beneficial ownership of securities or
          otherwise, in matters to be acted upon at the meeting. For the purpose
          of this paragraph, "person" includes each person (a) who has been a
          director, senior officer or insider of the Company at any time since
          the commencement of the Company's last fiscal year, (b) who is a
          proposed nominee for election as a director of the Company, or (c) who
          is an associate or affiliate of a person included in subparagraphs (a)
          or (b).
          
          Related Party Receivables
          
          
          Included in accounts receivable is $1,650,000 (2001 - $746,000) due
          from Thunderbird Panama. Also included in accounts receivable is
          $18,000 (2001 - $17,000) receivable from officers of the Company. The
          receivable amounts are unsecured, non-interest bearing and due on
          demand. Included in loans payable is $285,000 (2001 - $799,000) due to
          related parties.
          
          Included in amounts receivable are share purchase loans totaling
          $36,000 (2001 - $45,000) due from certain management and officers of
          the Company. The amount is secured by non-interest bearing notes due
          on the earlier of November 2004 or upon ceasing employment.
          Included in loans payable is $nil (2001 - $155,000) due to
          Thunderbird Panama. This amount represents the balance due in excess
          of the Company's proportionate share of the net assets included on
          consolidation.
          
          During the year, the Company recorded management fees of $nil (2001
          - $200,000; 2000 - nil) from the Nuevo Laredo operation pursuant to
          the "Management Agreement" dated November 2000 and management fees of
          $nil (2001 - $80,000; 2000 - nil) from the Reynosa operation pursuant
          to the "Management Agreement" dated June 2001. Subsequent to December
          31, 2001, the "Management Agreement" for the Reynosa operation was
          terminated pursuant to the terms of the agreement due to the closure
          of the skill game facility and the failure to re-open within a period
          of six months. In addition, the Company charged administrative and
          overhead costs of $nil (2001 - $111,000; 2000 - $148,000) to the
          Matamoros operation, $nil (2001 - $24,000; 2000 - nil) to the Nuevo
          Laredo operation, $nil (2001 - $32,000; 2000 - nil) to the Reynosa
          operation, and $48,000 (2001 - $151,000; 2000 - $40,000) to the
          Venezuelan operation.
          
          Item 8 - Financial
          Statements
          
          
          The Company has included as part of this filing our Audited
          Consolidated Balance Sheets as at December 31, 2002 and 2001, and the
          Consolidated Statements of Operations and Deficit, and Cash Flows for
          each of the years in the three year period ended December 31, 2002.
          See Consolidated Financial Statements listed in response Item 17,
          herein.
          
          Item 9 - The Offering
          and Listing
          
          
          Trading History
          
          
          The common shares of the Company were listed for trading on the
          Vancouver Stock Exchange ("VSE") on July 15, 1988 and on the Toronto
          Stock Exchange ("TSE") on February 13, 1996. The Company delisted from
          the VSE in March of 1999 due to lack of trading on the VSE. The
          Company's common shares continue to be listed for trading on the TSE.
          The closing price of the Company's common shares on December 31, 2000
          was Cdn $0.80. The following summarizes the reported high and low
          prices and the volume of trading of the Company's common shares on the
          VSE and TSE for the periods indicated:
          
          Trading information for trading of the Company's common shares on
          the VSE




Period Ended
          High      
          (Cdn $)
          Low       
          (Cdn $)
          VolumeYear ended:December 31, 1996
          6.00
          2.66
          4,576,434December 31, 1997
          2.10
          1.30
          59,700December 31, 1998
          0.65
          0.59
          44,500The common shares of the Company were listed for
          trading on the TSE on February 13, 1996. The closing price of the
          Company's common shares on December 31, 2002 was CDN $0.09. The TSX
          suspended the Company's shares from trading effective November 1,
          2002. The following summarizes the reported high and low prices and
          the volume of trading of the Company's common shares on the TSE for
          the periods indicated:
          
          Trading information for trading of the Company's
          common shares on the TSE.






Period Ended
          High ($)
          Low ($)
          VolumeYear ended:December 31, 1996
          5.87
          2.26
          11,969,500December 31, 1997
          2.75
          1.00
          15,756,438December 31, 1998
          1.90
          0.20
          10,890,145Quarter ended:March 31, 1999
          1.00
          0.45
          1,647,114June 30, 1999
          0.90
          0.45
          2,446,768September 30, 1999
          1.45
          0.65
          2,667,778December 31, 1999
          1.20
          0.55
          2,591,236March 31, 2000
          2.10
          0.69
          3,615,208June 30, 2000
          1.60
          1.00
          1,169,319September 30, 2000
          1.71
          1.10
          1,849,829December 31, 2000
          1.41
          0.71
          1,163,081Month ended:January 31, 2001
          0.85
          0.50
          262,781February 28, 2001
          1.24
          0.64
          621,662March 31, 2001
          1.23
          0.77
          333,100April 30, 2001
          1.12
          0.80
          312,999May 31, 2001
          1.09
          0.75
          330,250June 30, 2001
          0.92
          0.73
          213,178July 31, 2001
          0.78
          0.50
          566,528August 31, 2001
          0.66
          0.47
          500,376September 30, 2001
          0.62
          0.55
          332,715October 31, 2001
          0.57
          0.37
          632,990November 30, 2001
          0.48
          0.37
          262,200December 31, 2001
          0.44
          0.27
          954,681January 31, 2002
          0.425
          0.340
          355,070February 28, 2002
          0.53
          0.33
          510,875March 31, 2002
          0.495
          0.385
          431,350April 30, 2002
          0.405
          0.20
          348,908May 31, 2002
          0.26
          0.12
          470,575June 30, 2002
          0.18
          0.14
          271,550July 31, 2002
          0.15
          0.05
          130,125August 30, 2002
          0.20
          0.08
          582,280September 30, 2002
          0.10
          0.04
          583,076October 31, 2002
          0.10
          0.02
          2,980,799November 30, 2002
          0.09
          0.06
          33,000December 31, 2002
          N/a
          N/a
          N/aJanuary 31, 2003
          N/a
          N/a
          N/aFebruary 28, 2003
          N/a
          N/a
          N/aMarch 31, 2003
          N/a
          N/a
          N/aApril 30, 2003
          N/a
          N/a
          N/aAt December 31, 2002, there is no active trading market for the common
          shares in the United States, although United States residents may
          purchase common shares in Canada. The following table indicates the
          approximate number of record holders of common shares with United
          States addresses and the portion and percentage of common shares so
          held in the United States. On such date, 23,475,868 common shares were
          outstanding.






Total Number of 
          Holders
          Number of U.S. 
          Holders
          Number of 
          Common Shares 
          Held in the U.S.
          Percentage of 
          Common Shares 
          Held in the U.S.133
          109
          5,662,314
          24%The computation of the number and percentage of common shares held in
          the United States is based upon the number of common shares held by
          record holders with United States addresses and by trusts, estates or
          accounts with United States addresses as disclosed to the Company
          following inquiry to all record holders known to the Company to be
          trustees, executors, guardians, custodians or other fiduciaries
          holding common shares for one or more trusts, estates or accounts.
          United States residents may beneficially own common shares held of
          record by non-United States residents.
          
          A substantial number of common shares are held in
          "street name" by trustees, executors, guardians, custodians or other
          fiduciaries, including depositories, brokerage firms and financial
          institutions. Based on the number of annual reports and proxy
          statements requested by such nominees, management of the Company
          estimates that the number of beneficial holders of common shares
          exceeds 2,850.
          
          Item 10 -
          Additional Information
          
          
          Memorandum and Articles of Association
          
          
          International Thunderbird Gaming Corporation ("the
          Company") was incorporated by registration of its memorandum and
          articles under the Company Act (British Columbia) on September 4, 1987
          under the name "Winters Gold Hedley Ltd.". The Company changed its
          name to "Regal Gold Corporation" and consolidated its share capital on
          a 2.5:1 basis effective August 26, 1993. The Company subsequently
          changed its name to International Thunderbird Gaming Corporation, and
          updated its articles, effective June 23, 1994.The Company continued
          into the Yukon effective February 5, 1999, as approved by the
          shareholders of the Company on June 18, 1998.
          The Company's "corporate access" number in the Yukon
          is 26985.
          
          The Company's objectives and purposes are described in
          its Bylaws (see section 2 of the Bylaws) and its Articles of
          Continuance, attached as Exhibit 1.
          
          The following comprises the summary of provisions of
          the articles of continuance and bylaws relating to directors: Nothing
          in the Articles of Continuance affects the rights of directors as
          identified in this section. The By-Laws, (section three) identifies
          the director's responsibilities and restrictions if any; section five
          provides for Indemnity for the Directors.
          
          The company is authorized to issue an unlimited number
          of shares divided into Common and Preferred shares as identified in Exhibit 2(a), which describes the rights, preferences and
          restrictions attaching to each class.
          
          See attached Exhibit 2(a) which describes what
          action is necessary to change the rights of holders of the stock
          
          Provisions relating to the Annual and Special meetings
          of Shareholders are set forth in Section 8 of the Articles of
          Continuance attached as Exhibit 1.
          
          Exhibit 2(a) contains any and all restrictions
          with respect to shareholders rights.
          
          Exhibit 2(a) may be viewed as having an effect of
          delaying, deferring or preventing change in control of the company in
          that the Articles provide for a rotating board of directors whereby
          two directors are voted on every three years, two additional directors
          are voted on every two years and two are voted on every year. In
          addition, the directors are authorized to issue an unlimited number of
          preferred shares as described in the schedule.
          
          Nothing contained in the Articles or in the Bylaws
          governs the ownership threshold above which shareholder ownership must
          be disclosed. The Canadian securities laws provide that such ownership
          must be disclosed when any single individual or entity has 5% or
          greater ownership.
          
          Material Contracts
          
          
          
          The following contracts were previously provided and
          are incorporated herein by reference:
          Thunderbird de Guatemala: The Company entered into
            an agreement dated 10/6/97 with ILAC to develop, construct and
            manage a video gaming parlor within the Camino Real Hotel in
            Guatemala City, Guatemala. The facility opened for operation in
            February 1998. The Company's agreement is for a term of five years.
            The Company shares profit with ILAC and the Pediatric Foundation, a
            Guatemalan charitable organization set up to aid Guatemalan
            children.
          International Thunderbird Gaming (Panama)
            Corporation: The Company and a group of Panamanian individuals and
            entities entered into a Second and Fully Restated Shareholder
            Agreement dated 3/1/00 which outlines and defines the rights of the
            owners in the Company's affiliate, a Panamanian entity that owns and
            operates six Casinos in the Republic of Panama.
          Lease Agreement dated 8/10/00 with the Hotel
            Presidente between Daniel Mikowski Hun, Fiesta Juegos De Costa Rica,
            S.A., and Clay Hardin: This lease agreement pertains to the
            Company's Costa Rica Casino operation proposed to open in October,
            2001. The initial lease term is for five years with a five-year
            option. The space is located within the Presidente Hotel in San
            Jose, Costa Rica.
          Leasing Contract dated 9/1/00 between Hotel
            Intercontinental, International Thunderbird Gaming Corporation, and
            Thunderbird de Nicaragua S.A. This lease agreement pertains to the
            Company's Nicaragua Casino operation, which opened for business in
            February 2001. The initial lease term is for five years with two
            renewable options for five years each. The space is located within
            the Intercontinental Hotel in Managua, Nicaragua.
          Asset Purchase Agreement dated 9/30/00 between
            Calsino, Inc., a Kansas corporation, Calsino, Inc., a California
            corporation, Thunderbird Greeley, Inc., a Colorado corporation, and
            International Thunderbird Gaming Corporation, a Canadian
            corporation: The Company's subsidiary, Calsino Inc. had been engaged
            in manufacturing and installing commercial and gaming signs. The
            Company sold substantially all of its assets to the former manager
            of Calsino.
          Letter Agreement dated 11/3/00 between Provident
            Group Limited and International Thunderbird Gaming Corporation:
            Thunderbird engaged Provident as its exclusive financial advisor
            wherein Provident would seek equity and or debt financing for
            various Thunderbird projects. The agreement was terminated on the
            basis that Provident could not find any sources.
          Venezuela preliminary casino license received on
            11/3/00: the Company's affiliate, Fiesta Casino Guayana C.A., a
            Venezuelan entity, received an operations license to operate a
            casino at the Intercontinental Hotel in Puerto Ordaz, Venezuela.
          Entertainmens de Mexico-Nuevo Laredo, S. De R.L.
            (Subscription Agreement, Quota Agreement, Franchise Agreement,
            Management Agreement dated 11/5/00) by and among International
            Thunderbird Gaming Corporation, Peter Watson, Mauricio Girault,
            Muffy Bennett, Michael Snow, Wayne Rudd, RNST, LLC, and
            Entertainmens de Mexico, Nuevo-Laredo SRL: This set of agreements
            establishes the rights and obligations of the various parties with
            respect to the Company's Skill Game operation located in Nuevo
            Laredo, Mexico. The company owns an equity interest in the operation
            along with the other parties who invested cash in exchange for
            equity and profit participation.
          Lease for space in Laredo Mexico dated 11/17/00: The
            company's affiliate, Entertainmens de Mexico-Laredo, S. de R.L. R.L.
            entered into a real property lease agreement to lease a skill game
            operations in Nuevo Laredo, Mexico. The lease is for a term of one
            year with two extensions for an additional five-year option and
            three-year option, respectively.
          Termination Agreement dated 11/23/00 between Telerey
            S.A. de C.V., Fiestacasinos.com N.V. and MVS: The company's
            subsidiary, Fiestacasinos.com N.V. terminated its agreement with MVS
            which had been engaged to advertise and promote the
            Fiestacasinos.com Internet gaming (outside the U.S.) website.
          Loan & Security Agreement dated 12/21/00 between
            Fiesta Casinos Guayana, Borrower, and Del Sur, Entidad de Ahorro y
            Prestamos, Lender (Construction Draw Note): The Company's affiliate,
            Fiesta Casino Guyana C.A., a Venezuelan entity entered into a
            construction loan agreement with a local Venezuelan bank wherein FCG
            would draw funds to complete the construction of the Casino facility
            located within the Intercontinental Hotel in Guayana, Venezuela.
          Thunderbird de Nicaragua S.A.: (Promissory Notes,
            Subscription Agreement and Quota Agreement dated 12/21/00) by and
            among International Thunderbird Gaming Corporation, FFFH Inc., ANCAR
            Inc., El Tejar Inc., Inversiones Inc.: This set of agreements
            establishes the rights and obligations of the various parties with
            respect to the Company's Casino operation located within the
            Intercontinental Hotel in Managua, Nicaragua. The Company's
            subsidiary (Thunderbird Panama BVI) owns an equity interest in the
            operation along with the other parties who invested cash in exchange
            for equity and profit participation.
          Letter Agreement dated 3/1/01 between First Access
            Financial Group, Inc. and International Thunderbird Gaming
            Corporation: First Access Group was engaged by Thunderbird to work
            alongside MRG (see above) to arrange for financing for various
            Mexico projects that Thunderbird is putting together.
          Loan Agreement dated 3/9/01 and Development
            Agreement dated 5/18/01 between Management Resources Group and
            International Thunderbird Gaming Corporation: The Company entered
            into this agreement with a group out of Kansas City, Kansas whereby
            MRG loaned the Company approximately $1.3 million payable in 5 years
            but subject to conversion rights wherein MRG, at its option could
            convert the principal on the loan to common stock at US $(.60). In
            addition the agreements provide that MRG will raise, invest, or fund
            and participate as an equity participant in various Thunderbird
            projects.
          Settlement Agreement dated 4/5/01 between
            International Thunderbird Gaming Corporation and Tule River Indian
            Tribe. The company was engaged in litigation with a California
            gaming tribe that allegedly owed the company several million dollars
            stemming from a Video Gaming Machine Revenue Share Agreement. The
            Company and the tribe settled the case for $500,000 plus returns of
            the used machines.
          Entertainmens de Mexico-Matamoros S. De R.L.
            (Subscription Agreement, Quota Agreement, Franchise Agreement,
            Management Agreement dated 6/20/01) by and among International
            Thunderbird Gaming Corporation, Peter Watson, Mauricio Girault,
            Frank Bennett, Michael Snow, Kevin McDonald, FFFH Inc., and two
            other investors whose entities are yet to be established: This set
            of agreements establishes the rights and obligations of the various
            parties with respect to the Company's Skill Game operation located
            in Matamoros, Mexico. The Company owns an equity interest in the
            operation along with the other parties who invested cash in exchange
            for equity and profit participation.
          Entertainmens de Mexico-Reynosa S. De R.L.
            (Subscription Agreement, Quota Agreement, Franchise Agreement,
            Management Agreement dated 6/22/01) by and among International
            Thunderbird Gaming Corporation, Peter Watson, Mauricio Girault, and
            MRG Entertainment of Reynosa LLC and Entertainmens de Mexico-
            Reynosa SRL: This set of agreements establishes the rights and
            obligations of the various parties with respect to the Company's
            Skill Game operation located in Reynosa, Mexico. The Company owns an
            equity interest in the operation along with the other parties who
            invested cash in exchange for equity and profit participation.
          Material Contracts Provided with this Filing:
          
          
          Amendment to Loan Agreement of 3/9/01 between
            International Thunderbird Gaming Corporation as Borrower and
            Management Resources Group as Lender
            Loan Participation Agreement and Security Agreement
            between MRG Entertainment of Puerto Ordaz Venezuela LLC and Fiesta
            Casino Guayana C.A.
            Loan Agreement Secured by Pledge Agreement, Pledge
            Agreement, and Amended and Restated Loan Agreement among
            International Thunderbird Gaming Corporation and MRG Entertainment,
            LLC
            Loan and Security Agreement between Fiesta Casinos
            Guayana and Del Sur
            Memorandum of Understanding, Amended and Restated
            Memorandum of Understanding, Second Restated Memorandum of
            Understanding, and Third Restated Memorandum of Understanding
            between International Thunderbird Gaming Corporation, T.H.E.
            Venezuelan Entertainment, C.A., Entertainment & Ventures
            Consultants, Inc., and International Thunderbird Gaming (Panama)
            Corporation.
            Stock Purchase Agreement among Skill Game Equipment
            BVI Limited, International Thunderbird BVI Limited, and Creditek
            Siglo Veintiuno S.A.
            Release Agreement between International Thunderbird Gaming
            Corporation and Hopland Band of Pomo Indians ($500,000 settlement)
            Release Agreement between International Thunderbird Gaming
            Corporation and Hopland Band of Pomo Indians ($750,000 settlement)
            Settlement Agreement and Mutual General Release between
            International Thunderbird Gaming Corporation and Shuffle MasterExchange Controls and Other Limitations Affecting
          Security Holders
          
          
          
          There is no law or governmental decree or regulation
          in Canada that restricts the export or import of capital, or affects
          the remittance of dividends, interest or other payments to a
          non-resident holder of common shares, other than withholding tax.
          
          There is no limitation imposed by Canadian law or by
          the constituent documents of the Company on the right of a
          non-resident to hold or vote common shares, other than as provided in
          the Investment Canada Act (the "Act"). The following summarizes the
          principal features of the Act.
          
          The Act requires certain "non-Canadian" individuals,
          governments, corporations or other entities who wish to acquire a
          "Canadian business" (as defined in the Act), or establish a "new
          Canadian business" (as defined in the Act) to file either a
          notification or an application for review with a governmental agency
          known as "Investment Canada." The Act requires that certain
          acquisitions of control of a Canadian business by a "non-Canadian"
          must be reviewed and approved by the Minister responsible for the Act
          on the basis that the Minister is satisfied that the acquisition is
          "likely to be of net benefit to Canada," having regard to criteria set
          forth in the Act.
          
          Only acquisitions of control are reviewable under the
          Act. However, the Act provides detailed rules for the determination of
          whether control has been acquired and, pursuant to those rules, the
          acquisition of one-third or more of the voting shares of a corporation
          may, in some circumstances, be considered to constitute an acquisition
          of control. Certain reviewable acquisitions of control may not be
          implemented before being approved by the Minister. If the Minister
          does not ultimately approve a reviewable acquisition, which has been
          completed, the acquired Canadian business must be divested.
          
          Failure to comply with the review provisions of the
          Act could result in, among other things, an injunction or a court
          order directing disposition of assets or shares.
          
          Taxation
          
          
          A brief description of certain provisions of the tax
          treaty between Canada and the United States is included below,
          together with a brief outline of certain taxes, including withholding
          provisions to which United States security holders are subject under
          existing laws and regulations of Canada and the United States; the
          consequences, if any, of state and local taxes are not considered. The
          following information is general and security holders should seek the
          advice of their own tax advisors, tax counsel or accountants with
          respect to the applicability or effect of their own individual
          circumstances of not only the matters referred to herein, but also any
          state or local taxes. The Company has not paid dividends on the common
          shares in any of its last five fiscal years, and has no plans to pay
          dividends in the immediate future.
          
          Canadian federal tax legislation would require a 25%
          withholding from any dividends paid or deemed to be paid to the
          Company's non-resident shareholders. However, individual shareholders
          resident in the United States would generally have this rate reduced
          to 15% through the tax treaty between Canada and the United States. If
          a company resident in the United States owns at least 10 % of the
          voting stock of the Company, the withholding rate is further reduced
          by the tax treaty to 5%." The amount of stock dividends paid to
          non-residents of Canada would be subject to withholding tax at the
          same rate as cash dividends. The amount of a stock dividend (for tax
          purposes) would generally be equal to the amount by which the stated
          capital of the Company had increased by reason of the payment of such
          dividend. The Company will furnish additional tax information to
          shareholders in the event of such a dividend. Interest paid or deemed
          to be paid on the Company's debt securities held by non-Canadian
          residents may also be subject to Canadian withholding tax. The rate of
          withholding is reduced to 10% by the tax treaty between Canada and the
          United States.
          
          Gains derived from a disposition of shares of the
          Company by a non-resident shareholder will be subject to tax in Canada
          if, generally, not less than 25% of any class of shares of the Company
          was owned by the non-resident shareholder and/or persons with whom the
          non-resident did not deal at arm's length at any time during the
          five-year period immediately preceding the disposition. In such cases,
          gains derived by a U.S. shareholder from a disposition of shares of
          the Company would likely be exempt from tax in Canada by virtue of the
          Canada-U.S. tax treaty, except generally where the U.S. shareholder
          was previously resident in Canada for ten years and has not been a
          non-resident of Canada for at least ten years immediately preceding
          the disposition.
          
          All security holders are advised to consult their own
          tax advisors with respect to the specific tax consequences of
          purchasing common shares.
          
          Item 11 - Quantitative and Qualitative Disclosures about Market Risk
          
          
          The profitability of the Company may be adversely
          affected by fluctuations in the rate of exchange among various
          currencies. The Company does not currently take any steps to hedge
          against currency fluctuations. The Company is exposed in all of its
          operating entities except in Panama, where the local currency is tied
          1:1 to the U.S. Dollar.
          
          Item 12 - Description of Securities Other, than Equity Securities
          
          
          Not Applicable
          
          Item 13 - Defaults, Dividend Arrearages and Delinquencies
          
          
          In June of 2002, the Company was faced with a
          potential proxy fight threatened by certain dissident shareholders. In
          this threatened action, Alex Winch, the former Chairman of the Board
          of the Corporation, notified Mr. Mitchell and Mr. Atallah that he was
          leading a group of dissident shareholders who were requesting the
          resignation of all of the directors of the Corporation in favour of
          their appointees to the board failing which they intended to solicit
          proxies from all shareholders to appoint their slate of nominees to
          the board to replace the existing directors. They further advised that
          if the existing board would not agree to their request and they were
          subsequently successful in electing their nominees to the board, they
          would terminate the employment of all of the officers without
          severance and relocate the head office of the Company to Toronto. Mr.
          Winch represented to Mr. Mitchell and Mr. Atallah that he had the
          support of shareholders holding a sufficient number of shares of the
          Company to carry out his objectives. After making these demands and
          contacting a number of the Company's business partners and lenders,
          the dissidents concluded that they would not be in a position to carry
          on successfully the various Company's business relationships without
          the existing management, and Mr. Winch withdrew his demands. This led
          to subsequent discussions between the existing management and Mr.
          Guggenheim, who Mr. Winch had requested be part of his dissident
          group, and he agreed to join the board. Mr. Duval, a long time
          shareholder of the Company, was recommended to the Company by other
          sources. The management expects a good working relationship with both
          of the new directors.
          The disruption in management caused by the dissident
          group has led the Company's primary lender and development partner,
          MRG Entertainment LLC, to serve notices of default in respect of loans
          totaling $2,880,000 made by MRG and its affiliates to the Company,
          with respect to the following listed loan agreements:
          
          a. Pursuant to a loan agreement dated as of March 9,
          2001 and a first amendment to loan agreement, dated May 1, 2001
          (collectively, the "Agreement") between International Thunderbird
          Gaming Corporation (the "Corporation") and Management Resources
          Group, LLC ("MRG"), MRG loaned the Corporation $1,312,800 under the
          Term Loan, as defined in the Agreement (the "Convertible Loan");
          
          The Agreement provided that the Term Loan and all
          amounts payable thereunder were convertible into 2,000,000 Common
          shares of the Corporation based on a conversion price of $0.65 per
          share (the "Conversion Privilege");
          
          b. On or before October 1, 2001, the Agreement was
          assigned to MRG Entertainment, LLC ("MRG Entertainment") and the
          Corporation borrowed an additional $300,000 from MRG Entertainment
          which was added to the $1,312,800 Convertible Loan, for a total of
          $1,612,800 ("Term Loan 1") with the same terms and conditions, all as
          set out in the amended and restated loan agreement secured by pledge
          agreement dated October 1, 2001 between the Corporation and MRG
          Entertainment (the "First Entertainment Agreement"), which amended and
          restated the Agreement in its entirety.
          c.Pursuant to the First Entertainment
          Agreement, a warrant certificate and agreement was issued which
          provided that $1,300,000 of the principal amount outstanding of Term
          Loan 1 could be converted to 2,000,000 Common shares of the
          Corporation at $0.65 per share, and that a further $120,750 of the
          principal amount outstanding of Term Loan 1 could be converted to
          345,000 Common shares of the Corporation at $0.35 per share, which
          warrant certificate and agreement bears the date of issue of March 7,
          2004 (the "First Warrant") and which replaced in entirety the
          Conversion Privilege.
          d.Pursuant to a loan participation agreement
          dated August 8, 2001, MRG Entertainment of Puerto Ordaz Venezuela, LLC
          loaned to Fiesta Casino Guayana C.A. the sum of $530,000 ("Term Loan
          2"). MRG Entertainment is owned 99.9% by The Langley Entertainment
          Group, Ltd., and 0.1% by Dennis Langley individually. MRG
          Entertainment of Puerto Ordaz Venezuela, LLC, a Kansas LLC is owned
          99.9% by The Langley Entertainment Group, Ltd, and 0.1% by MRG
          Entertainment. 
          e.Pursuant to a loan agreement secured by
          pledge agreement dated as of October 1, 2001 (and noted as being made
          as of September 30, 2001), MRG Entertainment loaned to the Corporation
          the sum of $750,000 ("Term Loan 3").
          
          The Notices claim a default on the basis of a "change
          of control" in management and in the composition of the board of
          directors. The loan documents provide the Company with a 30 day period
          to cure defaults, and the reconstitution of the board and
          reappointments of the officers of the Company referred to above
          rectify the circumstances on which default was claimed within the 30
          day cure period. As a result of the Company's covenant violations at
          December 31, 2001, in relation to its loan with Prime Leasing,
          mentioned below, the Company is also in default of its loans with MRG.
          The Company has obtained a waiver from the MRG as of December 31, 2001
          through April 1, 2003 and therefore, has classified the short-term and
          long-term portions of the Term Loans in accordance with the terms of
          the loan agreements. The Company subsequently re-negotiated the MRG
          Loans on the following basis:
          
          MRG Entertainment incurred various cost and charges,
            which the Corporation was responsible to pay which as of October 1,
            2002 amounted to approximately $300,000 (the "Miscellaneous
            Charges").
            The Corporation has agreed to assume the obligation
            to repay Term Loan 2 and has further agreed to refinance Term Loan 1
            and Term Loan 3 and to pay the Miscellaneous Charges pursuant to a
            loan agreement dated October 1, 2002 between the Corporation and MRG
            Entertainment (the "Consolidated Term Loan Agreement" and the
            "Consolidated Term Loan", respectively). As at December 31, 2002 the
            total outstanding principal balance of the Consolidated Term Loan
            was $2,974,643.
            In conjunction with the Consolidated Term Loan
            Agreement, the Corporation issued a warrant certificate and
            agreement effective December 30, 2002 which gives MRG Entertainment
            the right to convert a portion of the Consolidated Term Loan into
            2,345,000 Common shares of the Corporation at the rate of the lesser
            of CDN $0.15 or US $0.10 per share (the "Second Warrant" and the
            "Second Warrant Shares", respectively).
            The Second Warrant replaces the First Warrant in its
            entirety. Although the Second Warrant refers to Series A and Series
            B Warrants, that is a typographical error and there are no series of
            warrants.
            MRG has assigned all of its interest in the
            Agreement and the Conversion Privilege to MRG Entertainment. MRG
            Entertainment confirms that the Consolidated Term Loan Agreement and
            the Second Warrant replaces all previous documents relating to or
            issued on account of the indebtedness for Term Loan 1, Term Loan 2
            and Term Loan 3 recited in the Consolidated Term Loan Agreement.
            There are no warrants or any other rights or options outstanding
            that entitle MRG Entertainment to purchase shares of the
            Corporation, other than the Second Warrant
          As of July 15, 2002, the Company was behind on three
          payments to Prime Leasing, totaling $63,807. During the year ended
          December 31, 2000, the Company renegotiated the terms of this loan on
          which it was in arrears in payments and in default. The loan was
          replaced by the 13% interest rate loan amortized over 26 months with
          monthly payments of principal and interest of $33,000. During the year
          ended December 31, 2001, the Company was again in arrears and in
          default and renegotiated the terms of the loan. The loan amortization
          period was extended to 48 months with monthly payments of principal
          and interest of $21,270. During the period subsequent to the
          renegotiation and as at year-end, the Company was in violation of
          certain covenants specified under the terms of the loan. The Company
          has obtained a waiver from the lender as of December 31, 2001 through
          January 1, 2004 and therefore, has classified the short-term and
          long-term portions of the loan in accordance with the renegotiated
          terms. The Company thereafter entered into a settlement agreement with
          Prime Leasing whereby the Company agreed to pay Prime $730,000 over a
          period of 73 months at no interest. All payments are current.
          
          As of July 15, 2002 the Company is behind on two
          payments to EH&P, totaling $62,850. The two payments due EH&P
          represent the total balance due on that loan. The Company has now paid
          EH&P in full.
          
          In addition, Thunderbird Gaming, Inc. has past due tax
          liabilities associated with the year ended December 31, 1997 with the
          IRS of $96,099 (includes penalties and interest), which was the result
          of an IRS audit completed in June of 2002, this liability was recorded
          in the second quarter of 2002, and the California Franchise Tax board
          of $184,540 (includes penalties and interest), which was accrued prior
          to December 31, 2001. International Thunderbird Gaming Corporation has
          a past due tax liability associated with the year ended December 31,
          1997 with the IRS of $62,945 (includes penalties and interest), which
          was accrued prior to December 31, 2001. International Thunderbird
          Gaming SRL has a past due tax liability associated with the year ended
          December 31, 1997 with Barbados of $160,110 (includes penalties and
          interest), which was accrued prior to December 31, 2001. As of the
          date of this filing, the Company plans on applying to the various
          taxing authorities for offers in compromise to eliminate or
          substantially reduce the tax liabilities but has no assurance of
          success nor its ability to pay these liabilities.
          
          The Company, and thus the securities of the Company,
          should be considered a highly speculative investment and investors
          should carefully consider all of the information disclosed in this
          Annual Report prior to making an investment in the Company. The
          Company operates in a risky business environment. There are a number
          of risks inherent to the Company's business. In addition to the other
          information presented in this Annual Report, the following risk
          factors should be given special consideration when evaluating an
          investment in any of the Company's securities.
          
          These consolidated financial statements have been
          prepared on a going concern basis in accordance with Canadian
          generally accepted accounting principles, which assumes that the
          Company will continue in operation for the foreseeable future and be
          able to realize its assets and discharge its liabilities and
          commitments in the normal course of business. However, the Company has
          incurred significant losses to the year ended December 31, 2001, has a
          working capital deficiency at December 31, 2002 of $2,806,000 (2001 -
          $3,081,000) and has recently had to seek a waiver from its primary
          lender relating to covenant violations on certain borrowings as at
          December 31, 2002 (see Note 9 to Audited Financial Statement - loans
          payable).
          
          During the year ended December 31, 2001, Fiesta
          Casinos Guayana, C.A. ("Fiesta Casinos Guayana"), the Venezuelan
          company in which the Company has an equity interest, may have been
          subjected by the National Casinos, Bingo Parlors and Slot Machines
          Commission of Venezuela (the "Commission") to penalties and fines
          because it transferred all of its shares to a national financial
          institution as security, thereby violating certain provisions of the
          Control of Casinos, Bingo Parlors and Slot Machines Act. On December
          21, 2001, in response to Fiesta Casinos Guayana's request for
          authorization to keep the security in force, the Commission asked the
          Company to add a clause to the final loan contract stipulating that
          Fiesta Casinos Guayana must obtain prior authorization from the
          Commission to proceed to judicial sale or undertake any other legal
          transaction which implies transfer of ownership of the shares put up
          as security, initially or as a result of a capital increase by Fiesta
          Casinos Guayana. Fiesta Casinos Guayana had not made the change in the
          final loan contract required by the Commission and had not made any
          provisions in its financial statements at December 31, 2001 for any
          possible penalties and fines relating to this issue. During the
          current year the loan was paid in full and consequently the Company is
          no longer in violation as at December 31, 2002.
          
          Since July 2001, the Company has been working to
          develop future profitable operations and improve the working capital
          position of the Company. During the year ended December 31, 2001, the
          Company refocused its efforts toward the operation and profitability
          of current facilities as opposed to the development of new facilities.
          As a result, the Company reduced its development and support staff and
          related expenses. In addition, the Company reduced its staff levels in
          the Republic of Panama and refinanced a portion of its debt during the
          year.
          
          The ability of the Company to continue as a going
          concern and to realize the carrying value of its assets and discharge
          its liabilities when they become due is dependent on the success of
          its core operations. Management believes that the core operations, in
          conjunction with the expected increase in profits from the Company's
          investments in Venezuela and Nicaragua, which commenced operations in
          the year ended December 31, 2001, will mitigate the adverse conditions
          and events which raise doubt about the validity of the going concern
          assumption used in preparing these financial statements.
          
          These financial statements do not reflect adjustments
          that would be necessary if the Company is unable to continue as a
          going concern. If the going concern assumption is not appropriate for
          these financial statements, then adjustments would be necessary in the
          carrying value of assets and liabilities, the reported net losses, and
          the balance sheet classifications used.
          
          During 2001, the Mexican government closed the skill
          game facilities in Matamoros, Nuevo Laredo and Reynosa, Mexico in
          which the Company has an equity interest, alleging the operations are
          in violation of the law. The Company is currently pursuing a claim
          under section 11 of the North American Free Trade Agreement and the
          trial on the claim is set for the week of April 24, 2004.
          
          The auditor's report on the Company's December 31,
          2002 financial statements includes additional comments that state that
          the financial statements are affected by conditions and events that
          cast substantial doubt on its ability to continue as a going concern.
          The financial statements do not include any adjustments that may
          result from the outcome of that uncertainty.
          
          Item 14 - Material Modifications to the Rights of Security Holders and
          Use of Proceeds
          
          
          Not Applicable
          
          Item 15
          Controls and Procedures.
          
          (a) The conclusions of the registrant's principal
          executive officer or officers and principal financial officer or
          officers, or persons performing similar functions, about the
          effectiveness of the registrant's disclosure controls and procedures
          (as defined in ss240.13a-15(c) and 240.15d-15(c)) based on their
          evaluation the controls and procedures as of a date within 90 days
          prior to the filing date of the report are:The Company has
          designed and continues to maintain an appropriate system of internal
          controls to provide reasonable assurance that the accounting systems
          provide timely, accurate and reliable financial information and to
          safeguard the Company's assets. These controls are reviewed and
          improved, when and where applicable, on an ongoing basis.
          (b) There were no significant changes in the
          registrant's internal controls or in other factors that could
          significantly affect these controls subsequent to the date of their
          evaluation, including any corrective actions with regard to
          significant deficiencies and material weaknesses.
          
          Item 16A -Audit Committee Financial Expert
          
          Generally speaking, the Board supervises the
          management of the business and affairs of the Company. More
          specifically, the Board has a mandate to provide guidance to the
          Company's management in the following areas:
          
          Long-term strategic planning;
            Risk analysis and monitoring of risk management
            systems;
            Overseeing the appointment and training of senior
            management and monitoring their performance, including succession
            planning;
            Establishing and monitoring the Company's
            communications policy as implemented by the Company's investor
            relations personnel and ensuring that they address the feedback and
            concerns of shareholders in particular;
            Ensuring the integrity of the Company's systems for
            internal controls and management information;
            Developing and implementing the Company's corporate
            governance guidelines;
            Reviewing management's performance on a regular
            basis, being at least annually;
            Reviewing the Company's business plan on a regular
            basis, being at least annually;
            Reviewing and approving the terms of all debt and
            equity financings, mergers, acquisitions and divestitures and the
            granting of incentive stock options;
            Reviewing and approving the quarterly and annual
            financial statements;
            Calling shareholders' meetings;
            Reviewing and approving all major public disclosure
            documents; and
            Appointing members to the various committees.Composition of the Board
          
          The Company's current board consists of five
          directors: two inside directors (Jack R. Mitchell and Albert Atallah)
          and three outside directors (Salomon Guggenheim, Jean Duval and Jorge
          Montano). Jack R. Mitchell and Salomon Guggenheim are elected as board
          members until the 2004 Annual General Meeting of Shareholders. Jean
          Duval, Albert W. Atallah, and Jorge Montano are up for re-election at
          this year's Annual General Meeting of Shareholders but Jorge Montano
          will not seek another term. Jorge Montano's board seat will remain
          vacant until after this years Annual Meeting of Shareholders. The
          newly constituted board of directors will fill this seat with a
          selection of an unrelated director.
          The articles of the Company permit the directors to
          appoint directors to fill any casual vacancies that may occur on the
          board. The articles of the Company also permit the directors to add
          additional directors to the board between successive annual general
          meetings so long as the number appointed does not exceed more than
          one-third of the number of directors appointed at the last annual
          general meeting. Individuals appointed as directors to fill casual
          vacancies on the board or added as additional directors hold office
          like any other director until the next annual general meeting at which
          time they may be reelected or replaced
          The Company's board of directors is presently
          constituted with a majority of individuals who qualify as unrelated
          directors. The newly constituted board of directors will fill Jorge
          Montano's vacant seat with a selection of an unrelated director for
          the ensuing year. An unrelated director is a director who is
          independent of management and is free from any interest and any
          business or other relationship which could, or could reasonably be
          perceived to, materially interfere with the director's ability to act
          with a view to the best interests of the corporation, other than
          interests and relationships arising from shareholding. A related
          director is a director who is not an unrelated director.
          The Company's board of directors has in place
          appropriate structures and procedures to ensure that the board can
          function independently of management. To that end, the board has (i)
          appointed a chair of the board who is not a member of management with
          responsibility to ensure the board discharges its responsibilities, or
          (ii) alternatively the board would adopt means such as assigning this
          responsibility to a committee of the board or to a director also known
          as a "lead director." The board recognizes that appropriate procedures
          could involve the board meeting on a regular basis without management
          present or it could involve expressly assigning the responsibility for
          administering the board's relationship to management to a committee of
          the board.
          The board of directors has examined its board size
          and, with a view to determining the impact of the number upon
          effectiveness, will undertake where appropriate, a program to reduce
          or increase the number of directors to a number which facilitates more
          effective decision-making.
          The Company does not have a "significant shareholder"
          who is able to elect a majority of the Company's Board.
          Committees
          
          The Board presently has one committee, an Audit
          Committee (referenced below), to which it assigned specific
          responsibilities. However, due to the size of the Company and its
          Board, the entire Board instead performs the following functions,
          which the TSE recommends that committees perform:
          considering and approving compensation of management
            and of the Board and ensuring that it is commensurate with the level
            of responsibility and risk involved;
            assessing effectiveness of the Board, performance of
            committees and the contribution of individual directors;
            proposing new nominees for the Board and assessing
            directors on an ongoing basis;
            providing orientation and education for newly
            appointed directors;
            defining responsibilities for the Board and
            management;
            developing corporate objectives to be met by the
            CEO;
            approval of all business decisions relating to
            expenditures;
            developing and implementing the Company's corporate
            governance guidelines; and
            proposing new nominees for the Board and assessing
            directors on an ongoing basis.Audit Committee
          
          Following the previous meeting of shareholders, an
          Audit Committee consisting of three directors, two of whom were
          outside and unrelated directors, was properly constituted. The Audit
          Committee carries out the following responsibilities:
          reviewing the Company's audited financial
            statements; and
            Meeting with the Company's management and auditors
            for that purpose.The members of the Audit Committee are identified
          under "Election of Directors". To ensure that the Board is able to
          function independently from management, the Company appointed an Audit
          Committee of three directors (see disclosure under "Committees" in
          this section). The Company's audit committee is currently comprised of
          Jean Duval (independent outside board member), Salomon Guggenheim
          (independent outside board member) and Jack R. Mitchell (President,
          CEO and Director) in compliance with section 173 (2) of the Act.
          The financial statements for the Corporation for the
          year ended December 31, 2002 (the "Financial Statements") have been
          prepared by the auditors for the Corporation, Davidson & Company.
          The Registrant's auditor for the periods ending
          December 31, 2001 and December 31, 2000 was KPMG, an independent
          accountant who was previously engaged as the principal accountant to
          audit the Registrant's financial statements.  KPMG resigned its
          position effective November 15, 2002 and was replaced by Davidson &
          Company, Chartered Accountants. The Registrant filed required
          documentation with each of the appropriate securities commissions to
          advise of the change of accountants. Such documentation established
          that the former accountant, KPMG's report on the financial statement
          for the past two years (December 31, 2001 and December 31, 2000) was
          unqualified and did not contain an adverse opinion or a disclaimer of
          opinion. The decision to change accountants was approved by the
          Registrant's board of directors. Further, during the Registrant's two
          most recent fiscal years (December 31, 2001 and December 31, 2000) and
          any subsequent interim period preceding such resignation, there were
          no disagreements with the former accountant, KPMG on any matter of
          accounting principles or practices, financial statement disclosure, or
          auditing scope of procedure, which disagreement(s), if not resolved to
          the satisfaction of the former accountant, KPMG, would have caused it
          to make reference to the subject matter of the disagreement(s) in
          connection with its report. Effective November 15, 2002, the
          Registrant engaged Davidson & Company, as its new independent
          accountant to audit the Registrant's financial statements for the
          period ending December 31, 2002. The new accountant, Davidson &
          Company's report on the financial statement for the period ending
          December 31, 2002 was unqualified and did not contain an adverse
          opinion or a disclaimer of opinion.
          Outside Advisors
          
          The board of directors has implemented a system, which
          enables an individual director to engage an outside adviser at the
          expense of the Company in appropriate circumstances. The engagement of
          the outside advisor should be subject to the approval of an
          appropriate committee of the board.
          Item 16B- Code of
          Ethics
          
          (a) The Registrant has adopted a code of ethics that
          applies to the Registrant's principal executive officer, principal
          financial officer, principal accounting officer or controller, or
          persons performing similar functions.
          (b) "code of ethics" means written standards that are
          reasonably designed to deter wrongdoing and to promote:
          (1) Honest and ethical conduct, including the ethical
          handling of actual or apparent conflicts of interest between personal
          and professional relationships;
          (2) Full, fair, accurate, timely, and understandable disclosure in
          reports and documents that a registrant files with, or submits to, the
          Commission and in other public communications made by the registrant;
          (3) Compliance with applicable governmental laws, rules and
          regulations;
          (4) The prompt internal reporting of violations of the code to an
          appropriate person or persons identified in the code; and
          (5) Accountability for adherence to the code.
          (c) The registrant has:
          (1) Filed with the Commission a copy of its code of ethics that
          applies to the registrant's principal executive officer, principal
          financial officer, principal accounting officer or controller, or
          persons performing similar functions, as an exhibit to this annual
          report;
          (2) Undertaken in its annual report filed with the Commission to
          provide to any person without charge, upon request, a copy of such
          code of ethics and explain the manner in which such request may be
          made.
          Item 17 -
          Financial Statements
          
          
          
          The Company has included as part of this filing our
          Audited Consolidated Balance Sheets as at December 31, 2002 and 2001
          and the Consolidated Statements of Operations and Deficit, and Cash
          Flows for each of the years in the three year period ended December
          31, 2002, together with the Auditors' Reports.
          
          Item 18 -
          Financial Statements
          
          
          Not Applicable
          
          Item 19 - Exhibits












EXHIBIT
          NUMBER
          DOCUMENT DESCRIPTION
          DATE1.
          Previously filed and incorporated herein by reference:
          Articles of Incorporation and By-Laws
          2/5/992(a)
          Previously filed and incorporated herein by reference:
          Schedules A-E
          A - Share provisions of both common and preferred shares of
            International Thunderbird Gaming Corporation
            B - Special Resolution of the shareholders of International
            Thunderbird Gaming Corporation
            C - Dissent Provisions
            D - Special Resolution of the shareholders of International
            Thunderbird Gaming Corporation
            E - Ordinary Resolution of the shareholders of International
            Thunderbird Gaming Corporation
          2/5/992 (b)
          Previously filed and
          incorporated herein by reference:
          Amendment to Loan Agreement of 3/9/01 between International
            Thunderbird Gaming Corporation as Borrower and Management Resources
            Group as Lender
            Loan Participation Agreement and Security Agreement between MRG
            Entertainment of Puerto Ordaz Venezuela LLC and Fiesta Casino
            Guayana C.A.
            Loan Agreement Secured by Pledge Agreement, Pledge Agreement,
            and Amended and Restated Loan Agreement among International
            Thunderbird Gaming Corporation and MRG Entertainment, LLC
            Loan and Security Agreement between Fiesta Casinos Guayana and
            Del Sur
          5/1/01
          
          8/8/01
          
          10/1/01
          
          1/4/012(b)(ii)
          Previously filed and incorporated herein by reference:
          Toronto Stock Exchange Approval of Proposed Private Placement (Loan
          Agreement)
          2/19/01 & 3/26/012(b)(iii)
          None2(c)
          None3.
          None4(a)(1)
          Memorandum of Understanding between International Thunderbird Gaming
          Corporation, T.H.E. Venezuelan Entertainment, C.A., Entertainment &
          Ventures Consultants, Inc., and International Thunderbird Gaming
          (Panama) Corporation.
          12/22/004(a)(2)
          Amended and Restated Memorandum of
          Understanding between International Thunderbird Gaming Corporation,
          T.H.E. Venezuelan Entertainment, C.A., Entertainment & Ventures
          Consultants, Inc., and International Thunderbird Gaming (Panama)
          Corporation.
          2/9/014(a)(3)
          Second Restated Memorandum of
          Understanding between International Thunderbird Gaming Corporation,
          T.H.E. Venezuelan Entertainment, C.A., Entertainment & Ventures
          Consultants, Inc., and International Thunderbird Gaming (Panama)
          Corporation.
          7/1/014(a)(4)
          Third Restated Memorandum of
          Understanding between International Thunderbird Gaming Corporation,
          T.H.E. Venezuelan Entertainment, C.A., Entertainment & Ventures
          Consultants, Inc., and International Thunderbird Gaming (Panama)
          Corporation.
          10/1/014(a)(5)
          Release Agreement between
          International Thunderbird Gaming Corporation and Hopland Band of Pomo
          Indians ($500,000 settlement)
          10/11/014(a)(6)
          Release Agreement between
          International Thunderbird Gaming Corporation and Hopland Band of Pomo
          Indians ($750,000 settlement)
          5/02/024(a)(7)
          Settlement Agreement and Mutual
          General Release between International Thunderbird Gaming Corporation
          and Shuffle Master
          5/14/024(a)(8)
          Settlement Agreement and Mutual General
          Release between International Thunderbird Gaming Corporation and the
          Spotlight 29 Tribe ($730,000)
          4/21/034(a)(9)
          Consolidated Note Agreement between MRG Entertainment and
          International Thunderbird Gaming Corporation ($3,000,000)
          1/1/034(a)(10)
          Stipulation for Entry of
          Judgment and Dismissal, Order Thereon between Thunderbird-Greeley and
          Prime Receivables (aka Stellar Financial Company aka U.S. Bancorp
          Portfolio Services) ($730,000)
          10/024(a)(11)
          NAFTA arbitration filing between
          International Thunderbird Gaming Corporation and the Government of
          Mexico
          Trial-April, 20044(b)(i)
          None4(b)(ii)
          None4(b)(iii)
          None4(b)(iv)
          None4(c)
          None5.
          None6.
          None7.
          None8.
          List of All
          Subsidiaries9.
          None10.
          None21.
          KPMG
          Auditor's Report








---



INTERNATIONAL THUNDERBIRD GAMING

CORPORATION





CONSOLIDATED
    FINANCIAL STATEMENTS

(Expressed in United States Dollars)





DECEMBER 31, 2002





---









DAVIDSON&
          COMPANYA Partnership of Incorporated
          ProfessionalsChartered AccountantsINDEPENDENT AUDITORS' REPORT
          
          To the Shareholders of
          International Thunderbird Gaming Corporation
          
          We have audited the consolidated balance sheet of
          International Thunderbird Gaming Corporation as at December 31, 2002
          and the consolidated statements of operations and deficit and cash
          flows, expressed in United States Dollars, for the year then ended.
          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 audit.
          
          We conducted our audit in accordance with Canadian
          and United States generally accepted auditing standards. Those
          standards require that we plan and perform an audit to obtain
          reasonable assurance whether the financial statements are free of
          material misstatement. An audit includes examining, on a test basis,
          evidence supporting the amounts and disclosures in the financial
          statements. An audit also includes assessing the accounting principles
          used and significant estimates made by management, as well as
          evaluating the overall financial statement presentation.
          
          In our opinion, these consolidated financial
          statements present fairly, in all material respects, the financial
          position of the Company as at December 31, 2002 and the results of its
          operations and its cash flows, expressed in United States Dollars, for
          the year then ended in accordance with Canadian generally accepted
          accounting principles."DAVIDSON & COMPANY"Vancouver, Canada
          Chartered AccountantsMarch 28, 2003COMMENTS BY AUDITORS FOR U.S. READERS ON CANADA -
          U.S. REPORTING DIFFERENCE
          In the United States, reporting standards for
          auditors require the addition of an explanatory paragraph (following
          the opinion paragraph) when the financial statements are affected by
          conditions and events that cast substantial doubt on the Company's
          ability to continue as a going concern, such as those described in
          Note 1 to the financial statements. Our report to the shareholders
          dated March 28, 2003 is expressed in accordance with Canadian
          reporting standards which do not permit a reference to such events and
          conditions in the auditors' report when these are adequately disclosed
          in the financial statements.




"DAVIDSON & COMPANY"Vancouver, Canada
          Chartered AccountantsMarch 28, 2003A Member of
          SC International1200 - 609 Granville Street, P.O. Box 10372, Pacific
          Centre, Vancouver, BC, Canada, V7Y 1G6
          Telephone: (604) 687-0947  Fax (604) 687-6172




---





INTERNATIONAL
          THUNDERBIRD GAMING CORPORATIONCONSOLIDATED BALANCE SHEET
          (Expressed in thousands of United States Dollars)
          AS AT DECEMBER 312002
          2001ASSETSCurrent assetsCash and cash equivalents
          $     
          1,162
          $     
          1,494Accounts receivable
          2,243
          2,285Inventories (Note 3)
          293
          212Prepaid expenses
          393
          183Current portion of amounts
          receivable
          398
          9Total current assets
          4,489
          4,183Restricted cash
          707
          660Amounts receivable (Note 4)
          1,101
          1,588Investments in and advances to equity investees
          (Note 5)
          430
          856Capital assets (Note 6)
          6,356
          5,003Other assets (Note 7)
          1,470
          1,509$     
          14,553
          $     
          13,799




- continued -



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

---







INTERNATIONAL THUNDERBIRD GAMING CORPORATIONCONSOLIDATED BALANCE SHEET
          (Expressed in thousands of United States Dollars)
          AS AT DECEMBER 312002
          2001Continued.LIABILITIES AND SHAREHOLDERS' EQUITYCurrent liabilitiesAccounts payable and
          accrued liabilities
          $     
          4,497
          $     
          4,362Income taxes payable
          597
          1,073Current portion of capital
          lease obligations
          28
          90Current portion of loans
          payable
          2,005
          1,739Current portion of other
          payables
          168
          -Total current liabilities
          7,295
          7,264Capital lease obligations (Note 8)
          15
          22Loans payable (Note 9)
          3,626
          4,274Other payables (Note 10)
          591
          -Deferred gain (Note 11)
          848
          203Future income taxes (Note 15)
          691
          796Non-controlling interest
          -
          20713,066
          12,766Stockholders' equityCapital stock (Note 12)Authorized100,000,000 common shares without par valueIssued and outstanding23,475,868 (2001 - 23,490,374) common shares
          21,085
          21,089Deficit
          (19,321)
          (19,645)Foreign exchange
          adjustment
          (277)
          (411)1,487
          1,033$    
          14,553
          $     
          13,799Nature of operations (Note 1)Commitments and contingencies(Notes 1 and 17)Subsequent events(Note 22)


On behalf of the Board:Director
          
          DirectorJack Mitchell
          
          Albert Attallah




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

---







INTERNATIONAL THUNDERBIRD GAMING CORPORATIONCONSOLIDATED STATEMENT OF OPERATIONS AND DEFICIT
          (Expressed in thousands of United States Dollars)
          YEAR ENDED DECEMBER 312002
          2001
          2000REVENUEGaming operations
          $     18,519
          $     16,420
          $     16,194COSTS AND EXPENSESGaming operations
          6,935
          7,130
          6,257General and administrative
          6,984
          7,413
          5,779Amortization
          1,779
          1,296
          1,145Financing costs
          1,098
          1,086
          1,129Equity loss in equity
          investees and write-down of 
          equity  investment
          (Note 5)
          578
          1,366
          972Uncollectible receivables
          (Note 4)
          604
          -
          -Gain on sale of
          investments (Note 4)
          -
          (208)
          -Recovery of amounts
          receivable previously written-down
          (487)
          (494)
          -17,491
          17,589
          15,282Income (loss) before income taxes
          1,028
          (1,169)
          912Income taxes (Note 15)Current
          598
          695
          935Future
          147
          96
          606745
          791
          1,541Income (loss) from continuing operations before
          non-controlling interest
          283
          (1,960)
          (629)Non-controlling interest (Note 5)
          -
          67
          -Income (loss) from continuing operations
          283
          (1,893)
          (629)Income (loss) from discontinued operations 
          (Note 20)
          41
          (1,187)
          (662)Net income (loss) for the year
          324
          (3,080)
          (1,291)Deficit, beginning of year
          (19,645)
          (16,565)
          (15,274)Deficit, end of year
          $    (19,321)
          $    (19,645)
          $    (16,565)Basic and diluted earnings (loss) per share 
          (Note 13)Continuing operations
          $           0.01
          $         (0.08)
          $         (0.03)Discontinued operations
          -
          (0.05)
          (0.03)Net earnings (loss)
          $           0.01
          $         (0.13)
          $         (0.06)




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









INTERNATIONAL THUNDERBIRD GAMING CORPORATIONCONSOLIDATED STATEMENT OF CASH FLOWS
          (Expressed in thousands of United States Dollars)
          YEAR ENDED DECEMBER 312002
          2001
          2000CASH FLOWS FROM OPERATING ACTIVITIESIncome (loss) from
          continuing operations
          $       
          283
          $   
          (1,893)
          $     
          (629)Items not affecting cash:Amortization
          1,779
          1,296
          1,145Equity loss in associated companies
          578
          1,366
          972Future income taxes
          147
          96
          606Loss on disposal or write down of assets, net
          604
          (125)
          9Recovery of amounts previously written down
          (487)
          -
          -Minority interests
          -
          (67)
          -Other
          231
          98
          (27)Changes in non-cash
          working capital items:(Increase) decrease in accounts receivable
          (680)
          351
          (4)Increase in inventories and prepaid expenses
          (291)
          (264)
          409Increase in accounts payable and accrued liabilities
          939
          1,044
          (807)Increase (decrease) in income taxes payable
          (297)
          220
          316Continuing operations
          2,806
          2,122
          1,990Discontinued operations
          (Note 20)
          41
          -
          (740)Net cash provided by
          operating activities
          2,847
          2,122
          1,250CASH FLOWS FROM INVESTING ACTIVITIESLoans receivable, net
          152
          (332)
          442Expenditures on capital
          assets, net
          (3,033)
          (2,128)
          (709)Proceeds on disposal of
          capital assets
          -
          -
          15Shuffler rights
          -
          -
          11Expenditure on internet
          gaming license
          -
          -
          (250)California gaming amounts
          recoverable
          -
          626
          335Investment in and advances
          to equity investees
          (359)
          (1,264)
          (1,799)(Increase) decrease in
          restricted cash
          (47)
          51
          (217)(Increase) decrease in
          other assets
          (71)
          (67)
          -Proceeds on sale of
          partial interest in subsidiary (Note 5)
          -
          285
          -Net cash used in investing
          activities
          (3,358)
          (2,829)
          (2,172)




- continued -



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

---







INTERNATIONAL THUNDERBIRD GAMING CORPORATIONCONSOLIDATED STATEMENT OF CASH FLOWS
          (Expressed in thousands of United States Dollars)
          YEAR ENDED DECEMBER 312002
          2001
          2000Continued.CASH FLOWS FROM FINANCING ACTIVITIESNet proceeds from issuance
          of common shares
          5
          57
          51Loans payable
          1,698
          4,436
          1,868Repayment of convertible
          debentures
          -
          -
          (202)Repayment of loans and
          leases payable
          (1,524)
          (3,225)
          (2,164)Net cash provided by (used
          in) financing activities
          179
          1,268
          (447)Change in cash and cash equivalents during the year
          (332)
          561
          (1,369)Cash and cash equivalents, beginning of year
          1,494
          933
          2,302Cash and cash equivalents, end of year
          $     
          1,162
          $     
          1,494
          $       
          933Supplemental disclosure with respect to cash flows
          (Note 14):Interest paid
          $       
          659
          $       
          911
          $     
          1,095Income taxes paid
          711
          498
          667








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

---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          1.          NATURE OF
          OPERATIONS
          
          
          The Company's primary business activity is the
            provision of services to the gaming industry. The Company is or has
            been involved in the following business activities:
          Managing gaming operations under a Casino Administration and
              Operations contract dated January 29, 1998, at five (2001 - four)
              casinos in the Republic of Panama in which the Company also has a
              50% equity interest;
          Managing a video lottery operation in Guatemala, on a revenue
              and net profit sharing basis, under a Service and Supply agreement
              expiring October 2002. During the current year, the Company began
              renegotiating the agreement and subsequent to year end, a new
              seven year agreement was entered into on a revenue sharing basis,
              expiring March 2010;
          Managing operations at three skill game locations in Mexico in
              which the Company has an equity interest. During 2001, the Mexican
              government closed the skill game facilities in Matamoros, Nuevo
              Laredo and Reynosa, Mexico in which the Company had an equity
              interest, alleging the operations are in violation of the law. The
              Company has filed a $100 million claim under section 11 of the
              North American Free Trade Agreement ("NAFTA") subsequent to
              exhausting all other avenues for an equitable settlement with the
              Mexican government;
          Managing a gaming operation in Nicaragua, which opened in
              February 2001, under a five year lease agreement, expiring
              September 2005. The agreement can be renewed for two additional
              five year terms at the option of the Company;
          Managing a casino in Venezuela, which opened in August 2001,
              in which the Company has an equity interest;
          Participating in an internet gaming operation, on a net
              revenue share basis. In June 2001, the Company sold its interest
              in the internet gaming operation;
          Participating, on a revenue sharing basis, in a Native gaming
              operation in California; and
          Distribution of card shufflers in the United States and
              Central America. In May 2000, the Company sold the distribution
              rights and obtained a royalty interest in future sales of the card
              shufflers in the United States.
          The Company actively evaluates new opportunities
            presented or identified from time to time in the gaming industry.
          
          These consolidated financial statements have been
            prepared on a going concern basis in accordance with Canadian
            generally accepted accounting principles, which assumes that the
            Company will continue in operation for the foreseeable future and be
            able to realize its assets and discharge its liabilities and
            commitments in the normal course of business. However, the Company
            has incurred significant losses to the year ended December 31, 2001,
            has a working capital deficiency at December 31, 2002 of $2,806,000
            (2001 - $3,081,000) and has recently had to seek a waiver from its
            primary lender relating to covenant violations on certain borrowings
            as at December 31, 2002 (see Note 9 - loans payable).




---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          1.                      
          NATURE OF OPERATIONS (cont'd.)
          
          During the year ended December 31, 2001, Fiesta
              Casinos Guayana, C.A. ("Fiesta Casinos Guayana"), the Venezuelan
              company in which the Company has an equity interest, may have been
              subjected by the National Casinos, Bingo Parlors and Slot Machines
              Commission of Venezuela (the "Commission") to penalties and fines
              because it transferred all of its shares to a national financial
              institution as security, thereby violating certain provisions of
              the Control of Casinos, Bingo Parlors and Slot Machines Act. On
              December 21, 2001, in response to Fiesta Casinos Guayana's request
              for authorization to keep the security in force, the Commission
              asked the Company to add a clause to the final loan contract
              stipulating that Fiesta Casinos Guayana must obtain prior
              authorization from the Commission to proceed to judicial sale or
              undertake any other legal transaction which implies transfer of
              ownership of the shares put up as security, initially or as a
              result of a capital increase by Fiesta Casinos Guayana. Fiesta
              Casinos Guayana had not made the change in the final loan contract
              required by the Commission and had not made any provisions in its
              financial statements at December 31, 2001 for any possible
              penalties and fines relating to this issue. During the current
              year the loan was paid in full and consequently the Company is no
              longer in violation as at December 31, 2002.
              
              Since July 2001, the Company has been working
              to develop future profitable operations and improve the working
              capital position of the Company. During the year ended December
              31, 2001, the Company refocused its efforts toward the operation
              and profitability of current facilities as opposed to the
              development of new facilities. As a result, the Company reduced
              its development and support staff and related expenses. In
              addition, the Company reduced its staff levels in the Republic of
              Panama and refinanced a portion of its debt during the year.
              
              The ability of the Company to continue as a
              going concern and to realize the carrying value of its assets and
              discharge its liabilities when they become due is dependent on the
              success of its core operations. Management believes that the core
              operations, in conjunction with the expected increase in profits
              from the Company's investments in Venezuela and Nicaragua, which
              commenced operations in the year ended December 31, 2001, will
              mitigate the adverse conditions and events which raise doubt about
              the validity of the going concern assumption used in preparing
              these financial statements.
              
              These financial statements do not reflect
              adjustments that would be necessary if the Company is unable to
              continue as a going concern. If the going concern assumption is
              not appropriate for these financial statements, then adjustments
              would be necessary in the carrying value of assets and
              liabilities, the reported net losses, and the balance sheet
              classifications used.2.                      
          SIGNIFICANT ACCOUNTING POLICIES
          
          
          Basis of consolidation
          
          These consolidated financial statements include
              the accounts of International Thunderbird Gaming Corporation (the
              "Company") and its wholly and partially owned subsidiaries. The
              Company owns a 50% interest in International Thunderbird Gaming
              (Panama) Corporation ("Thunderbird Panama"), an incorporated joint
              venture which operates five casinos (2001 - four) in the Republic
              of Panama. The interest in the joint venture is accounted for in
              these financial statements under the proportionate consolidation
              method. All significant inter-company transactions and balances
              have been eliminated.




---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          2.                      
          SIGNIFICANT ACCOUNTING POLICIES (cont'd.)
          
          Cash and cash equivalents
              
              
              Cash equivalents consist of highly liquid
              investments that are readily convertible to known amounts of cash
              and generally have original maturities of three months or less.
              
              Inventories
              
              
              Inventory is recorded at the lower of cost and
              estimated net realizable value. Cost is determined using the
              weighted average method.
              
              Investments in and advances to equity investees
              
              
              The investments in and advances to equity
              investees are accounted for using the equity method. Under the
              equity method, the original cost of the shares is adjusted for the
              Company's share of post-acquisition earnings or losses and is
              reduced for dividends received.
              
              Restricted cash
              
              
              Restricted cash includes the Company's portion
              of the casino's bankroll and hopper loads in the Republic of
              Panama and Nicaragua.
              Capital assets
              
              
              Capital assets are recorded at cost.
              Amortization of capital assets is provided on a straight-line
              basis over their estimated useful lives as follows:


Building
          30 yearsFurniture, fixtures and equipment
          3 - 5 yearsGaming operations equipment
          3 - 5 yearsLeasehold improvements
          Over the lease termMachinery and equipment
          3 yearsVehicles
          3 - 5 years






















Other assets
              
              The Company's proportion of the fee for the
              right to operate casinos and slot machines in the Republic of
              Panama has been capitalized as license rights. The amount is being
              amortized on a straight-line basis over 20 years, being the term
              of the operating rights.




---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          2.                      
          SIGNIFICANT ACCOUNTING POLICIES (cont'd.)
          
          Income taxes
              
              
              The Company uses the asset and liability method
              of accounting for income taxes. Under the asset and liability
              method, future tax assets and liabilities are recognized for the
              future tax consequences attributable to differences between the
              financial statement carrying amounts of existing assets and
              liabilities and their respective tax bases. Future tax assets are
              recognized to the extent that realization of those assets is more
              likely than not. Future tax assets and liabilities are measured
              using enacted or substantively enacted tax rates expected to apply
              to taxable income in the years in which those temporary
              differences are expected to be recovered or settled. The effect on
              future tax assets and liabilities of a change in tax rates is
              recognized in income in the period that includes the date of
              enactment or substantive enactment. Withholding taxes, where
              applicable, on earnings of foreign operations are provided in the
              accounts only to the extent earnings are expected to be
              repatriated.
              
              Project development and pre-opening costs
              
              
              Project development costs incurred in an effort
              to identify and develop new gaming locations are expensed as
              incurred. Pre-opening costs for new projects that are not
              recoverable from third parties are expensed as incurred.
              
              Revenue recognition
              
              
              The Company recognizes as gaming revenues the
              net win from gaming activities which is the difference between
              coins and currencies deposited into the machines and payments to
              customers and, for other games, the difference between gaming wins
              and losses.
              Use of estimates
              
              
              The preparation of financial statements in
              conformity with Canadian generally accepted accounting principles
              requires management to make estimates and assumptions that affect
              the reported amounts of assets and liabilities and disclosure of
              contingent assets and liabilities at the date of the financial
              statements and the reported amounts of revenues and expenses
              during the reporting period. Significant areas requiring the use
              of management estimates include the determination of the
              recoverability of accounts and amounts receivable, investments,
              capital assets and other assets, the amortization rates of capital
              assets and other assets, and the valuation of inventory. Actual
              results could differ from those estimates.
              Reporting currency and foreign currency
              translation
              
              
              The Company reports all transactions in U.S.
              dollars except where noted. For companies in the group that
              maintain their records in Canadian dollars, monetary assets and
              liabilities have been translated at the year end rate,
              non-monetary items are translated at historical rates, and
              revenues and expenses translated at average rates for the period
              with any resulting gain or loss charged to operations.




---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          2.                      
          SIGNIFICANT ACCOUNTING POLICIES (cont'd.)
          
          Reporting currency and foreign currency
              translation (cont'd.)
              
              The current rate method is used to translate
              the financial statements of foreign operations. Under the current
              rate method, assets and liabilities are translated at exchange
              rates in effect at the balance sheet date and items in the
              statement of operations are translated at weighted average rates.
              Exchange gains and losses arising from the translation of the
              financial statements are deferred and included in the foreign
              exchange adjustment account in shareholders' equity until there
              has been a realized reduction in the net investment. The foreign
              exchange adjustment account at December 31, 2002 relates mainly to
              the Company's Guatemalan and Nicaraguan operations (2001 - mainly
              to Company's Guatemalan operations).
              
              An exception to the use of the current method
              for translating the financial statements of foreign operations may
              occur when the economic environment of the foreign operation is
              highly inflationary. In such events, the temporal method is used
              to translate the financial statements of the foreign operation.
              
              Earnings (loss) per share
              
              
              The Company uses the treasury stock method to
              compute the dilutive effect of options, warrants and similar
              instruments. Under this method the dilutive effect on earnings per
              share is recognized on the use of the proceeds that could be
              obtained upon exercise of options, warrants and similar
              instruments. It assumes that the proceeds would be used to
              purchase common shares at the average market price during the
              period.
              
              Basic earnings (loss) per share is calculated
              using the weighted-average number of shares outstanding during the
              year.Stock-based compensation plan
          
          Effective January 1, 2002, the Company adopted
              the new CICA Handbook Section 3870 "Stock-Based Compensation and
              Other Stock-Based Payments", which recommends the fair value-based
              methodology for measuring compensation costs. The new section also
              permits, and the Company has adopted, the use of the intrinsic
              value-based method, which recognizes compensation cost for awards
              to employees only when the market price exceeds the exercise price
              at date of grant, but requires pro-forma disclosure of earnings
              and earnings per share as if the fair value method had been
              adopted. The Company has elected to adopt the intrinsic
              value-based method for employees awards. Any consideration paid by
              the option holders to purchase shares is credited to share
              capital. There is no effect on the financial statements for the
              years presented.3.                      
          INVENTORIES






2002
          2001Parts and supplies
          $        293
          $        212






---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          4.                     
          AMOUNTS RECEIVABLE
          
          
          Amounts receivable consist of the following:




2002
          2001Costs recoverable from third party participant in
          Guatemalan operation
          $       
          161
          $        530Apuestas Continentales, S.A.
          408
          408Tristar Media, Inc.
          -
          335Fiesta Juegos de Costa Rica, S.A.
          269
          269Hopland Band of Pomo Indians
          625
          -Other
          36
          551,499
          1,597Current portion of amounts receivable
          (398)
          (9)$     
          1,101
          $      1,588a)         
          Costs recoverable from third party participant in Guatemalan operation
          
          
          The Company is eligible to recover leasehold
            improvement costs incurred for the Guatemalan operation from a third
            party participant in the Guatemalan revenue and net profit sharing
            agreement ("Profit Share Agreement"). The amounts are collectible on
            a monthly basis from the third party's share of revenue and net
            profits from the operations. The costs recoverable are non-interest
            bearing. During the year ended December 31, 2000, the third party
            ceased reimbursing these costs and is currently disputing
            eligibility for reimbursement of certain of these costs under the
            agreement. An arbitration proceeding concerning this dispute was
            completed in March 2002. At December 31, 2002, the amounts were
            written down by $369,000 to the amount awarded by the arbitrator of
            $161,000.
          b)        
          Apuestas Continentales, S.A.
          
          
          The Company has a promissory note dated March 1,
            2000 for the sale of gaming machines to Apuestas Continentales, S.A.
            ("Apuestas"). The note is non-interest bearing, with 24 monthly
            payments of $22,000 beginning April 1, 2001 and maturing on March 1,
            2003. Apuestas has not made any payments as required under the terms
            of the note. The Company entered into discussions with Apuestas as
            payments have not been received as required under the terms of the
            note and is actively pursuing various options to collect the
            remaining balance.










---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          4.                    
          AMOUNTS RECEIVABLE (cont'd.)
          
          
          c)         
              Tristar Media, Inc. (successor to Sing Security Services, Ltd.)
              
              
              On June 30, 2001, the Company sold its
                internet gaming business, FiestaCasinos.com, to Sing Security
                Services Ltd. for proceeds consisting of a $340,000 note
                receivable and the assumption of a related liability in the
                amount of $70,000, resulting in a gain of $208,000. The note
                receivable bears interest at 10% and requires monthly payments
                of interest of $2,333 commencing July 31, 2001 through to
                December 31, 2001, and monthly payments of principal and
                interest of $7,224 from January 31, 2002 through to December 31,
                2006. The note receivable is secured by the shares of
                FiestaCasinos.com. In addition, under the terms of the sale, the
                Company has the right until June 30, 2006 to buy-back a 50%
                interest in FiestaCasinos.com at a price based on
                FiestaCasinos.com's current earnings before interest, taxes,
                depreciation and amortization. During the year ended December
                31, 2002, the Company established a reserve against the
                receivable as a result of the uncertainty of collectibility.
                However, the Company continues to pursue collection.d)        
              Fiesta Juegos de Costa Rica S.A.
              
              
              On August 23, 2001, the Company sold its
                gaming subsidiary, Fiesta Juegos de Costa Rica S.A. ("Fiesta
                Juegos"), to a third party for proceeds consisting of a note
                receivable for $269,000, resulting in a gain on sale of $203,000
                (Note 11). The note receivable bears interest at 12%, with
                monthly payments consisting of 25% of the net income from the
                operations of Fiesta Juegos, beginning the earlier of 45 days
                after Fiesta Juegos achieves positive cash flows from operations
                or November 1, 2001. The Company entered into discussions with
                the purchaser of Fiesta Juegos as payments have not been
                received as required under the terms of the note and is actively
                pursuing various options to collect the remaining balance.e)         
              Hopland Band of Pomo Indians
              
              The Company previously entered into various
                agreements for the financing, design and construction of a
                gaming facility on the Hopland Indian Reservation ("Hopland")
                which included a one-half interest in a Gaming Hardware Lease
                Agreement (the "Lease"). Pursuant to a settlement agreement
                dated May 31, 2002, Hopland agreed to pay the Company $750,000
                in satisfaction of all obligations owing under the Lease and
                accordingly, the Company recorded a recovery of $750,000. The
                amount receivable from Hopland bears interest at 12% per annum
                and is repayable in monthly instalments of $24,900.




---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          4.                                   
          AMOUNTS RECEIVABLE (cont'd.)
          
          f)           
          California gaming amounts receivable
          
          During the year ended December 31, 1998, the
                Company agreed to sell a substantial majority of its interest in
                its California revenue share agreements, loans receivable from
                California Native Tribes and inventory. The transaction was not
                recorded as a sale, but rather the Company's California assets
                were presented as assets held for disposal, as the collection of
                the consideration from the buyer was dependent upon the buyer
                collecting sufficient payments from the Native Tribes on the
                assets sold once the legal and regulatory status of Native
                Gaming in California was settled. The carrying amount at
                December 31, 1998 represented the net book value of the assets
                at the date of the transaction and management's best estimate of
                the minimum amount that will be realized based on its evaluation
                of all relevant available information. During the year ended
                December 31, 1999, the sales agreement was rescinded by the
                parties and the California gaming assets reverted back to the
                Company. The Company collected $335,000 of the amount during the
                year ended December 31, 2000 and accordingly, reduced the amount
                recoverable. During the year ended December 31, 2001, an
                additional $1,120,000 was collected, resulting in a reduction of
                the amount recoverable balance to $Nil and a gain on collection
                of the Californian gaming amounts recoverable of $494,000.g)         
              Calsino, Inc.
              
              
              The Company has a promissory note dated
                October 1, 2000 resulting from the sale of the assets and
                liabilities of Calsino, Inc. ("Calsino"), including the name of
                the business, to former employees of Calsino (the "Employees").
                The note bears interest at 15%, with quarterly payments of
                $20,000 beginning April 15, 2001, and maturing on January 15,
                2006. The note is secured by an interest in certain assets.
                During the year ended December 31, 2001, the Employees ceased
                making the payments required under the terms of the promissory
                note. At December 31, 2001, the amount receivable was written
                down to $Nil, reflecting management's uncertainty of its ability
                to collect under the terms of the promissory note. During the
                year ended December 31, 2002, the Company collected and recorded
                a gain on settlement of $150,000 included in discontinued
                operations (Note 20).5.                      
          INVESTMENTS IN AND ADVANCES TO EQUITY INVESTEES
          
          
          Through its equity investments, the Company
              manages operations at one gaming operation in Venezuela (Note 5b)
              and managed operations in various skill game locations in Mexico
              (Note 5a). The equity investments of the Company and the Company's
              share of loss from these investments are as follows:






---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          5.                     
          INVESTMENTS IN AND ADVANCES TO EQUITY INVESTEES (cont'd.)






2002
          
          
          
          2001Mexico
          Venezuela
          Total
          
          Mexico
          Venezuela
          TotalInvestment
          $     
          100
          $     
          1,644
          $     
          1,744
          
          $       
          100
          $     
          1,894
          $     
          1,994Advances
          1,172
          430
          1,602
          
          896
          304
          1,2001,272
          2,074
          3,346
          
          996
          2,198
          3,194Loss/write-down ofequity investment
          (1,272)
          (1,644)
          (2,916)
          
          (996)
          (1,342)
          (2,338)$       
          -
          $       
          430
          $        430
          
          $         
          -
          $        856
          $        856


The equity losses of the
          Company's investees include pre-opening costs which are expensed by
          the investees in the year the costs are incurred.a)
          In Mexico, as at December 31, 2002 the Company has a 37% (2001 - 37%)
          equity interest in the operation located in Matamoros, a 33% (2001 -
          33%) equity interest in the operation located in Nuevo Laredo, and a
          40% (2001 - 40%) equity interest in the operation located in Reynosa,
          which was opened during 2001.As described in
          Note 1, during the year ended December 31, 2001, the Mexican
          government closed the three skill game facilities in Mexico in which
          the Company has an equity interest, alleging the operations are in
          violation of the law. Although the Company has filed a $100 million
          NAFTA claim against the Mexican government in relation to the closure
          of the Mexican operations, at December 31, 2001, the Company had
          written-down its investment in Mexico to $Nil due to the uncertainty
          of being able to recover its investment.b)
          The Company has a 36%
          equity (2001 - 40%) interest in the Venezuelan operation. During the
          year ended December 31, 2001, this interest was transferred, through a
          series of transactions, to a subsidiary in which a third party holds a
          non-controlling interest. During the year ended December 31, 2001, a
          portion of the Company's advances to the Venezuelan operation was
          capitalized to equity, thereby increasing the cost of its investment.
          During the year ended December 31, 2002, the subsidiary was
          re-structured to remove the third party minority interest and the
          Company recorded an impairment charge of $149,000 to reduce the
          balance of the investment and advances to the estimated net realizable
          value.








---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          6.                        
          CAPITAL ASSETS






2002
          
          
          
          2001Cost
          Accumulated
          Amortization
          Net
          Book Value
          
          Cost
          Accumulated
          Amortization
          Net
          Book ValueGaming operations 
     equipment
          $      4,837
          $      2,586
          $      2,251
          
          $      3,678
          $      1,679
          $      1,999Leasehold 
     improvements
          2,694
          552
          2,142
          
          1,967
          567
          1,400Machinery and 
     equipment
          1,068
          649
          419
          
          880
          469
          411Furniture, fixtures
     and equipment
          1,492
          652
          840
          
          858
          431
          427Building
          529
          53
          476
          
          529
          20
          509Land
          175
          -
          175
          
          175
          -
          175Vehicles
          125
          72
          53
          
          102
          55
          47Construction
     in progress
          -
          -
          -
          
          35
          -
          35$      10,920
          $      4,564
          $      6,356
          
          $      8,224
          $      3,221
          $      5,003








7.
          OTHER ASSETS2002
          2001Panama gaming
          license, net of amortization of $422 (2001 - $333)
          $      1,353
          $      1,442Other
          117
          67$      1,470
          $      1,509








---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          
          8.                      
          CAPITAL LEASE OBLIGATIONS
          
          
          The following minimum lease payments of the
              Company and the Company's share of minimum lease payments of its
              joint venture relating to various capital leases are as follows:






2002
          2001Year ending December 31:2003
          $         
          33
          $         
          1052004
          9
          242005
          6
          22006
          3
          -Total minimum lease payments
          51
          131Amount representing interest
          (8)
          (19)Balance of obligations
          43
          112Current portion of capital lease obligations
          (28)
          (90)Non-current portion of capital lease obligations
          $         
          15
          $         
          229.
          LOANS PAYABLE
          
          
          Loans payable consist of the following:














2002
          2001The Company and wholly
          owned subsidiaries:13% loan payable due in
          monthly instalments of principal only of $10,000 (2001 - $21,270),
          maturing October 2008 (2001 - September 2005), and secured by a
          certain lease of gaming machines (Note 9a).
          $        690
          75515% loan payable due in
          monthly instalments of principal and interest of $31,425, maturing May
          2002. The Company has pledged its ownership in Thunderbird Guatemala
          and the California gaming amounts recoverable as security for the loan
          and has offered a second security interest position in its ownership
          of Thunderbird Panama but only to the extent permitted by the terms of
          the licenses and by applicable Panamanian law.
          62
          180






- continued -



---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          9.                         
          LOANS PAYABLE (cont'd.)








2002
          2001Continued.The Company and wholly
          owned subsidiaries: (cont'd.)8.75% note payable due in
          monthly payments of principal and interest of $1,700, maturing August
          2004, and secured by certain assets.
          43
          4714% (30% upon the
          occurrence of an event of default) term loan due in quarterly payments
          of interest only ranging between $56,400 and $57,700, due through June
          2004, and secured by the shares of Thunderbird Panama (Note 9b).
          1,613
          1,61314% (16% upon the
          occurrence of an event of default) term loan due in monthly payments
          of principal and interest of $26,500, due through November 2004, and
          secured by the shares of Thunderbird Panama (Note 9b).
          532
          758Thunderbird Panama:Commercial loans due in
          monthly instalments of $20,800, plus annual interest at LIBOR six
          months plus 3%, due through December 2002 and unsecured.
          -
          250Commercial loan due in
          monthly instalments of $4,100, plus annual interest at LIBOR six
          months plus 3% reviewed semi annually, due through October 2003,
          secured by equipment.
          41
          91Commercial loan due in
          monthly instalments of $8,300, plus annual interest rate at prime rate
          plus 1%, with a minimum of 9%, maturing November 2003.
          83
          186Mortgage loan due in
          monthly instalments of $5,800, plus annual interest rate at prime rate
          plus 2.5%, maturing March 2011.
          589
          66518% notes payable, due in
          monthly instalments of $4,700, including interest, through October
          2003 (Note 16).
          45
          93Note payable due in
          monthly instalments of $24,000, plus annual interest at 12.5%,
          maturing in December 2003.
          268
          501




- continued -

---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          9.                       
          LOANS PAYABLE (cont'd.)








2002
          2001Continued.Thunderbird
          Panama: (cont'd.)Commercial
          loan due in monthly instalments of $4,000, plus annual interest at
          10%, maturing August 2002.
          -
          2512.6% notes
          payable, due in monthly instalments of $8,000 in 2001, including
          interest, through June 2002, guaranteed by equipment.
          -
          4618% note
          payable, due in monthly instalments of $5,600 including interest,
          through April 2002.
          -
          21Commercial
          loan due in monthly instalments of $17,800 plus interest at LIBOR six
          months with a minimum of 9%, with maturity date in January 2007.
          700
          -15% (2001 -
          18%) notes payable, due in monthly instalments including interest,
          ranging between $734 and $2,600 (2001 - $2,300 and $4,700) through
          April 2004 (Note 16).
          170
          15510.5% note
          payable due in monthly instalments of $5,400, including interest,
          through July 2003.
          35
          -8% note
          payable due in monthly instalments of $8,500, including interest,
          through January 2004.
          106
          -10% note
          payable due in monthly instalments of $16,800, including interest,
          through October 2004.
          336
          -10% commercial
          loan due in monthly instalments of $5,800, including interest, with
          maturity date in January 2003.
          6
          -8% commercial
          loan due in monthly instalments of $9,900, including interest, with
          maturity date in October 2003.
          96
          -8% commercial loan due in monthly instalments of
          $2,200, including interest, through November 2003.
          21
          -




- continued -

---

INTERNATIONAL THUNDERBIRD GAMING
          CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          9.                       
          LOANS PAYABLE (cont'd.)




2002
          2001Continued.Thunderbird
          Panama: (cont'd.)8% commercial loan due in monthly instalments of
          $3,700, including interest, with maturity date in December 2003.
          47
          -10% commercial loan due in monthly instalments of
          $3,700, including interest, with maturity date in May 2003.
          15
          -12.23% commercial loan due in monthly instalments
          of $800, including interest, with maturity date in May 2003.
          4
          -7.5% commercial loan due in monthly instalments of
          $5,800, including interest, with maturity date in October 2003.
          59
          -8% note payable due in monthly instalments of
          $4,000, including interest, through October 2004 (Note 16).
          39
          -15% note payable due in monthly instalments of
          $2,700, including interest, through January 2004 (Note 16).
          31
          -Thunderbird de Nicaragua:12% note payable due in monthly instalments of
          principal and interest of $2,100, maturing January 2004, secured by
          shares of Thunderbird de Nicaragua.
          -
          6212% note payable due in monthly instalments of
          principal and interest of $3,100, maturing January 2004, secured by
          shares of Thunderbird de Nicaragua.
          -
          9312% note payable due in monthly instalments of
          principal and interest of $4,100, maturing January 2004, secured by
          shares of Thunderbird de Nicaragua.
          -
          124






- continued -

---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          9.                         
          LOANS PAYABLE (cont'd.)








2002
          2001Continued.Thunderbird de
          Nicaragua: (cont'd.)12% note payable due in monthly instalments of
            principal and interest of $6,400, maturing January 2004, secured by
            shares of Thunderbird de Nicaragua.
          -
          19312% note payable due in monthly instalments of
            principal and interest of $2,500, maturing January 2004 (Note 16).
          -
          7612% note payable due in monthly instalments of
            principal and interest of $2,600, maturing April 2004 (Note 16).
          -
          795,631
          6,013Current portion of loans payable
          (2,005)
          (1,739)$      3,626
          $     4,274




a)
          13% loan:
          During the year ended December 31, 2000, the Company renegotiated the
          terms of a loan on which it was in arrears in payments and in default.
          The loan was replaced by the 13% interest rate loan amortized over 26
          months with monthly payments of principal and interest of $33,000.
          During the year ended December 31, 2001, the Company was again in
          arrears and in default and renegotiated the terms of the loan. The
          loan amortization period was extended to 48 months with monthly
          payments of principal and interest of $21,270. During the period
          subsequent to the renegotiation and as at December 31, 2001, the
          Company was in violation of certain covenants specified under the
          terms of the loan. The Company has obtained a waiver from the lender
          as of December 31, 2001 through January 1, 2004 and therefore, has
          classified the short-term and long-term portions of the loan in
          accordance with the renegotiated terms. During the year ended December
          31, 2002, the Company renegotiated the terms to $10,000 per month for
          73 months, without interest.b)
          14% term loans:
          As a result of the Company's covenant violations at December 31, 2001
          with respect to its 13% loan (Note 9a), the Company was also in
          default of its 14% term loans (the "Term Loans") at December 31, 2001.
          The Company obtained a waiver from the lender as of December 31, 2001
          through April 1, 2003 and therefore, has classified the short-term and
          long-term portions of the Term Loans in accordance with the terms of
          the loan agreements. The Term Loans are secured by the Company's 50%
          interest in Thunderbird Panama.








---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          9.                         
          LOANS PAYABLE (cont'd.)b)
          14% term loans (cont'd.):
          During the year ended December 31, 2002, the Company entered into
          negotiations to replace its 14% term loans and warrants with a new
          consolidated term loan and new warrants. The new consolidated term
          loan is effective January 1, 2003 (Note 22). The Company is in
          violation of certain covenants relating to the negotiation of its
          consolidated term loan. The Company has obtained a waiver from the
          lender and accordingly, only the amounts due in the next fiscal year
          pursuant to the term loans have been included as a current portion of
          loans payable.
          In connection with the Term Loans, the Company granted the Lender the
          right to purchase up to 2,000,000 common shares of the Company at a
          price of $0.65 per share ("Series A Exercise Price") and up to 345,000
          common shares of the Company at a price of $0.35 per share ("Series B
          Exercise Price") during the four month period from March 7 to July 7,
          2004 (collectively, the "Warrant"). Under the terms of the Warrant,
          the Series A Exercise Price and the Series B Exercise Price shall
          first be paid by reduction of the principal and interest on the Term
          Loans. In addition, if the Company prepays part or all of the Term
          Loans at any time and the weighted average trading price of the
          Company's common shares for 20 trading days (the "Average Price") is
          less than $4.00 per share at any time after the prepayment, the Lender
          will have the option to pay a portion of the Series A Exercise Price
          in cash up to the prepayment amount. This option will terminate on the
          earlier of September 1, 2003 or 30 days after the Company has notified
          the Lender that the Average Price has reached $4.00 per share. Under
          the terms of the Warrant, the Company also has, at any time after
          March 9, 2002, a one-time option to require the Lender to exercise all
          or any portion of the Warrant ("Forced Exercise"), except that the
          option may not be exercised unless the Average Price of the Company's
          common shares immediately prior to the exercise of the Company's
          option is at least $4.00 per share. If within 20 days after receiving
          notice of the Company's Forced Exercise, the Lender does not agree in
          writing to the Forced Exercise, the Company can prepay all amounts
          owing under the Term Loan and the Warrant will expire. If the Lender
          accepts the Forced Exercise and, at any time during the two year
          period following the Forced Exercise, sells any of the Warrant shares
          on the open market for a price per share of less than $2.00 per share,
          then at the end of the two year period, the Company will be required
          to pay the Lender the difference between the weighted average price at
          which the Warrant shares were sold and $2.00 per share.10.                      
          OTHER PAYABLES










2002
          2001Support Consultants, Inc.
          $        194
          $         
          -Former directors and associated companies
          468
          -Other
          97
          -759
          -Current portion of other payables
          (168)
          -$        591
          $         
          -






---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          10.                   
          OTHER PAYABLES (cont'd.)
          
          Support Consultants, Inc.
          
          On July 1, 2002, the Company entered into an
              agreement with Support Consultants, Inc. ("SCI") pursuant to which
              the Company, as a result of settlements with various California
              Native Tribes, agreed to pay SCI an additional $263,000 recorded
              as a reduction of amounts recovered from the Tribes. The Company
              also agreed to combine all amounts owing to and from SCI resulting
              in a net payable of $214,000 of which $20,000 has been paid to
              December 31, 2002. The remaining amount is repayable on a pro-rata
              basis from the amounts received from Hopland.Former directors and associated companies
          
          Effective December 31, 2002, the Company
              renegotiated the terms on accrued liabilities of $468,000, owed to
              former officers and an associated company, due on demand. The
              repayment terms were extended to instalments of $5,000 per month
              from January 1, 2003 to June 1, 2004, then $6,500 per month from
              July 1, 2004 to June 1, 2005, then $5,000 per month to June 1,
              2010.11.                    
          DEFERRED GAIN




2002
          2001Fiesta Juegos de Costa
          Rica S.A.
          $        203
          $        203Thunderbird de Nicaragua, S.A.
          645
          -$        848
          $        203Fiesta Juegos de Costa Rica S.A.
              
              
              The gain on the sale of Fiesta Juegos of
              $203,000 (Note 4) has been deferred at December 31, 2001 and 2002
              and will be recognized in income as the note receivable is
              collected.
              
              Thunderbird de Nicaragua, S.A.
              
              
              Subsequent to the year ended December 31, 2002,
              the Company entered into an agreement to merge its majority owned
              Nicaraguan subsidiary, Thunderbird de Nicaragua, S.A.
              ("Thunderbird Nicaragua"), with the operations of Hopewell
              Limited, S.A. ("Hopewell") (Note 22). In November, 2002, in
              preparation for the merger, the non-controlling shareholders'
              loans to Thunderbird Nicaragua of $645,000 were capitalized to the
              equity of Thunderbird Nicaragua. The effects of this
              capitalization will be recognized on merger of Thunderbird
              Nicaragua with Hopewell. The Company's equity interest in
              Thunderbird Nicaragua remained unchanged subsequent to the
              capitalization.








---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          12.                     
          SHARE CAPITAL






Number
          of Shares
          AmountIssuedBalance as at December 31, 1999
          23,159,312
          $     20,981Exercise of options
          155,000
          51Balance as at December 31,
          2000
          23,314,312
          21,032Exercise of options
          176,062
          57Balance as at December 31,
          2001
          23,490,374
          21,089Exercise of options
          25,494
          5Shares returned to treasury
          (40,000)
          (9)Balance as at December 31,
          2002
          23,475,868
          $     21,085Options
          The Company, through its Board of Directors and shareholders, adopted
          a July 1, 1997 Stock Option Plan. The Company has granted a number of
          stock options and entered into various agreements for which up to
          4,125,114 shares are available for purchase pursuant to options
          granted under this plan. All of the stock options issued under this
          plan are nontransferable and terminate on the earlier of the expiry
          date or 30 days after the grantee ceases to be employed by the
          Company. All options are vested when issued.






Number
          of Shares
          Weighted
          Average
          Exercise Price
          (CDN $)Balance as at December 31, 1999
          4,257,250
          $         
          0.75Granted
          622,500
          1.19Exercised
          (155,000)
          0.50Cancelled
          (610,535)
          0.91Balance as at December 31, 2000
          4,114,215
          0.81Granted
          245,000
          0.64Exercised
          (176,062)
          0.50Cancelled
          (193,000)
          1.40Balance as at December 31, 2001
          3,990,153
          0.77Granted
          1,165,000
          0.10Exercised
          (25,494)
          0.32Cancelled
          (1,042,045)
          1.29Balance as at December 31, 2002
          4,087,614
          $         
          0.45








---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          12.                  
          SHARE CAPITAL (cont'd.)
          
          Options (cont'd.)
              
              The following table summarizes information
              about the stock options outstanding at December 31, 2002:






Range of 
          Exercise prices (CDN $)
          Number 
          Outstanding
          Weighted Average
          Remaining Life
          Weighted Average
          Exercise Price
          (CDN $)$0.08 - $0.09
          1,120,000
          4.71 years
          $    0.09$0.32 - $0.55
          1,334,305
          1.06 years
          0.39$0.60 - $1.00
          1,234,559
          0.73 years
          0.63$1.10 - $1.25
          398,750
          2.97 years
          1.17$0.08 - $1.25
          4,087,614
          2.15 years
          0.45Stock-based compensation
          The Company granted 1,165,000 stock options to employees and directors
          during the current year. The Company has elected to measure
          compensation costs using the intrinsic value method for employee stock
          options. Under this method, no compensation expense was recognized
          when the stock options were granted. Had compensation costs been
          determined based on the fair value of the options granted using the
          Black-Scholes option-pricing model, additional compensation expense
          would have been recorded as follows:










Net income for the year as reported
          $ 324Additional compensation expense
          (65)Pro-forma net income
          $ 259Pro-forma earnings per share
          $ 0.01The weighted average fair value of each option granted during the
              current year was $0.10.The following weighted average assumptions were
              used for the Black-Scholes method of valuation of stock options
              granted during the year:










Risk-free interest rate
          4.5%Expected life of options
          5 yearsAnnualized volatility
          70%Dividend rate
          0%








---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          13.                   
          EARNINGS PER SHARE
          
          
          The following weighted average number of shares
              were used for computation of earnings per share:




2002
          2001
          2000Weighted average shares used in computation of
          basic 
     earnings per share and diluted earnings per share
          23,512
          23,398
          23,210Income (Loss) from continuing operations
          $        283
          $     (1,893)
          $        
          (629)Income (Loss) from discontinued operations
          41
          (1,187)
          (662)Net income (loss) for the year
          $        324
          $     (3,080)
          $      (1,291)Basic and fully diluted (loss) per shareContinuing operations
          $        0.01
          $       (0.08)
          $        (0.03)Discontinued operations
          -
          (0.05)
          (0.03)Net income (loss)
          $        0.01
          $     (0.13)
          $        (0.06)14.
          SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS
          
          Significant non-cash transactions for the year ended December 31, 2002
          included:






a)
          The Company negotiated an
          agreement pursuant to which amounts owing to SCI of $291,000 and due
          from SCI of $242,000 were combined into other payables.b)
          The Company acquired and
          cancelled 40,000 common shares in exchange for a loan receivable from
          a director of $9,000.c)
          The Company renegotiated
          the terms on accrued liabilities of $468,000, agreeing to pay $60,000
          in monthly instalments of $5,000 over the next fiscal year and
          extending the payment of $408,000 to non-current portion of other
          payables.d)
          The non-controlling
          shareholders' loans to Thunderbird Nicaragua of $645,000 were
          capitalized to the equity of Thunderbird Nicaragua resulting in a
          deferred gain.e)
          The Company acquired the
          non-controlling interest of a subsidiary held by a third party in
          exchange for a 4% equity interest in the Venezuelan operation.






---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          15.                     
          INCOME TAXES
          
          
          A reconciliation of income taxes at statutory rates is as follows:






2002
          2001
          2000Computed "expected" tax expense (recovery) at
          statutory rates
          $         
          371
          $        (450)
          $         
          360Increase (reduction) in income taxes resulting
          from:Lower effective income tax
          rate on income of foreign subsidiaries
          (571)
          (208)
          (135)Benefit of losses not
          reflected in accounts
          816
          1,351
          1,247Application of previously
          unrecognized tax losses
          -
          (53)
          (53)Other
          129
          151
          122$         
          745
          $         
          791
          $      1,541a)     Future tax assets and
          liabilities:
          
          The tax
          effects of temporary differences that give rise to significant future
          tax assets and future tax liabilities are as follows:










2002
          2001
          2000Future income tax assets:Non-capital loss carry forwards
          $     7,519
          $      7,955
          $      7,888Capital assets - unamortized
          tax cost in excess of net book value
          694
          755
          583Other
          -
          359
          -Total future tax assets
          8,213
          9,069
          8,471Valuation allowance
          (8,161)
          (8,964)
          (8,306)Future income tax assets,
          net of allowance
          52
          105
          165Future income tax
          liabilities:Capital assets - net book value in excess of unamortized capital cost
          217
          221
          195Other assets - net book value in excess of unamortized tax cost
          406
          432
          459Withholding tax on repatriation of retained earnings from foreign
          subsidiaries
          120
          248
          211Total future tax
          liabilities
          743
          901
          865Net future income tax
          liability
          $         
          691
          $         
          796
          $         
          700








---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          15.                    
          INCOME TAXES (cont'd.)b)
          Potential future tax benefitsAt December 31, 2002, the Company has Canadian
          non-capital loss carry forwards of approximately $8.3 million, United
          States' operating losses of approximately $13.6 million, Panama loss
          carry forwards of $0.2 million and Nicaraguan loss carry forwards of
          approximately $0.6 million. The Canadian non-capital loss carry
          forwards and United States' operating losses expire at various dates
          prior to 2009 and 2022, respectively. The Nicaraguan loss carry
          forwards are available to deduct against taxable income through 2006.
          Under Panamanian tax laws, the Panamanian loss carry forwards will be
          applied evenly against available taxable income through 2003. The
          potential income tax benefits related to the Canadian loss carry
          forwards, the United States' operating losses and the Nicaraguan loss
          carry forwards have not been reflected in the accounts.16.                    
          RELATED PARTY TRANSACTIONS
          
          
          Included in accounts receivable is $18,000
              (2001 - $17,000) receivable from officers of the Company. The
              receivable amounts are unsecured, non-interest bearing and due on
              demand. Included in loans payable is $285,000 (2001 - $799,000)
              due to related parties.
              
              Included in amounts receivable are share
              purchase loans totalling $36,000 (2001 - $45,000) due from certain
              management and officers of the Company. The amounts are secured by
              non-interest bearing notes due on the earlier of November 2004 or
              upon ceasing employment.
              Included in accounts receivable is $1,650,000
              (2001 - $746,000) due from Thunderbird Panama and included in
              loans payable is $Nil (2001 - $155,000) due to Thunderbird Panama.
              These amounts represents the balances due in excess of the
              Company's proportionate share of the net assets included on
              consolidation.
              
              During the year, the Company recorded
              management fees of $Nil (2001 - $200,000; 2000 - $Nil) from the
              Nuevo Laredo operation pursuant to the "Management Agreement"
              dated November 2000 and management fees of $Nil (2001 - $80,000;
              2000 - $Nil) from the Reynosa operation pursuant to the
              "Management Agreement" dated June 2001. During the year ended
              December 31, 2002, the "Management Agreement" for the Reynosa
              operation was terminated pursuant to the terms of the agreement
              due to the closure of the skill game facility and the failure to
              re-open within a period of six months. In addition, the Company
              charged administrative and overhead costs of $Nil (2001 -
              $111,000; 2000 - $148,000) to the Matamoros operation, $Nil (2001
              - $24,000; 2000 - $Nil) to the Nuevo Laredo operation, $Nil (2001
              - $32,000; 2000 - $Nil) to the Reynosa operation, and $48,000
              (2001 - $151,000; 2000 - $40,000) to the Venezuelan operation.






---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          17.                   
          COMMITMENTS AND CONTINGENCIESa)
          As at December 31, 2002, minimum
          operating lease payments of the Company and the Company's share of
          minimum operating lease payments of joint ventures were as follows:






2003
          $        7052004
          6572005
          5292006
          1162007
          116$     2,123




a)
          In addition to the above, Thunderbird
          Panama is committed to pay minimum annual rentals for two of the
          casinos equal to 9% of the net win less the income participation
          payable to the Government of the Republic of Panama.b)
          Thunderbird Panama is committed to pay
          the Government of the Republic of Panama an annual minimum income
          participation equal to $4,216,000 in the first year, which increases
          at 2% per year, or 10% of Thunderbird Panama's gross income, whichever
          is higher. This commitment commenced in August 1998, on the opening of
          the first casino in the Republic of Panama and related payments
          commenced shortly thereafter. Amounts paid under the agreement by
          Thunderbird Panama were $4,539,868 in 2002 (2001 - $4,428,577).c)
          Thunderbird Panama is committed to pay
          a 2% profit interest, defined as gross revenue less operating
          expenses, in the Panamanian operations to a third party. The Company
          is committed to pay to a third party $13,000 each month while
          operations continue in the Republic of Panama commencing July 1999,
          for a maximum of 10 years.d)
          Thunderbird Nicaragua is committed to
          pay a monthly poker license fee of $2,500 for the lease of a control
          and promotional system for the four poker tables at Fiesta Casino
          through to February 15, 2004. Amounts paid under the license agreement
          by Thunderbird Nicaragua were $30,000 in 2002 ($25,400 in 2001).e)
          In connection with the equity
          investment in Venezuela, the Company has pledged its shares of the
          equity investment as collateral on a $2,322,000 loan made available by
          a Venezuelan financial institution to the investee.f)
          As at December 31, 2002, principal
          payments required under the terms of the loan agreements and their
          liabilities in each of the next five years are as follows:




Year ending December 31:2003
          $      2,0332004
          2,7192005
          4012006
          4212007
          237$      5,811








---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          18.                  
          DISCLOSURES ABOUT FAIR VALUES OF FINANCIAL INSTRUMENTS
          
          Fair value:
          
          
          The carrying amount of cash and equivalents,
              accounts receivable, accounts payable and accrued liabilities and
              income taxes payable approximate their fair value because of the
              short-term maturities of these items. The carrying amount of the
              restricted cash approximates fair value because of the high
              liquidity of the item. Certain of the Company's amounts
              receivable, loans payable and other payables do not bear any
              interest, bear fixed rates of interest or are due to related
              parties. Due to the number and differing underlying terms and
              conditions of these receivables and debts, it is not practical to
              determine the fair value of these financial instruments with
              sufficient reliability.Credit risk:
          
          
          The Company is exposed to credit risk only with
              respect to uncertainties as the timing and amount of
              collectibility of accounts receivable and amounts receivable. The
              Company mitigates credit risk through standard credit and
              reference checks.Currency risk:
          
          
          The Company is exposed to financial risk
              arising from fluctuations in foreign exchange rates and the degree
              of volatility of these rates. The Company does not use derivative
              instruments to reduce its exposure to foreign currency risk.19.                   
          INVESTMENT IN JOINT VENTURES
          
          
          Amounts included in these financial statements related to the
              Company's interest in joint ventures are as follows:






2002
          2001Current assets
          $     1,238
          $     1,349Long-term assets
          7,902
          5,850Current liabilities
          3,430
          2,485Long-term liabilities
          1,757
          1,771Revenue
          14,717
          13,253Expenses
          12,865
          11,258Net income before taxes
          1,852
          1,995Cash flows from operating activities
          3,471
          2,164Cash flows from financing activities
          (547)
          (632)Cash flows from investing activities
          (2,950)
          (1,251)








---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          20.                   
          DISCONTINUED OPERATIONS
          
          
          During the year ended December 31, 2000, the Company discontinued
              the operations of its gaming products business. This operation
              consisted primarily of the gaming and commercial signage and
              display businesses, operated through Calsino, and the sale of
              gaming machines and the distribution of card shufflers in the
              United States and Central America.
              
              The assets of Calsino were sold to a third
              party on September 30, 2000 for proceeds of approximately
              $266,000, consisting of a note receivable, bearing interest at
              15%, with quarterly payments of $20,000 beginning April 15, 2001
              and maturing January 15, 2006. The note is secured by an interest
              in certain assets. The distribution rights to the Quick Draw
              Shuffler, acquired in 1999, were converted to a royalty interest
              whereby the Company will receive $500 per machine sold in the
              United States by the manufacturer. During 2001, these amounts were
              written down to $Nil, reflecting management's uncertainty of its
              ability to collect under the terms of the note and the royalty
              interest agreement, respectively. In addition, the inventory with
              a book value of $339,000 was written-off in fiscal 2001. During
              the year ended December 31, 2002, the Company collected and
              recorded a gain of $150,000 in settlement of the receivable
              previously written down.
              
              The amounts included in the balance sheet as at
              December 31 relating to the discontinued operations are as
              follows:






2002
          2001Amounts receivable (Note 4b)
          $         
          408
          $         
          408Capital lease obligations
          (9)
          (23)$         
          399
          $         
          385Revenue and
          expenses of the gaming products discontinued operations were as
          follows:










2002
          2001
          2000Sales
          $         
          -
          $         
          -
          $      1,004Cost of sales and general and administrative
          expenses
          -
          -
          1,744Depreciation and amortization
          -
          -
          25Gain on disposal of assets
          -
          -
          (103)General and administrative expenses
          (40)
          -
          -(Recovery) write-down of assets
          150
          (1,187)
          -Earnings (loss) before taxes
          110
          (1,187)
          (1,666)Income tax expense
          69
          -
          -Income (loss) for the year
          $         
          41
          $    (1,187)
          $      (662)


















---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          20.                    
          DISCONTINUED OPERATIONS (cont'd.)
          
          The cash provided by (used in) discontinued
              operations is as follows:






2002
          2001
          2000Income (loss) from discontinued operations
          $         
          41
          $    (1,187)
          $        (662)Write-down of assets
          -
          1,187
          -Gain on disposal of assets
          -
          -
          (103)Amortization
          -
          -
          25$         
          41
          $          
          -
          $        (740)21.
          SEGMENTED INFORMATIONManagement has
          organized the enterprise based on a combination of differences in
          products and services provided and geographic areas of operations.
          Based on this organization, the Company has the following reportable
          segments, excluding the revenue, expenses and assets from the
          discontinued operations disclosed in Note 20. The accounting policies
          of the segments are the same as those described in Note 2 of the
          financial statements.










2002
          Panama
          Gaming
          Guatemala
          Video
          Lottery
          California
          Gaming
          Nicaragua
          Corporate
          And Other
          TotalExternal
          revenue
          $
          14,717
          $
          1,762
          $
          -
          $
          2,028
          $
          12
          $
          18,519Amortization
          1,192
          310
          
          115
          162
          1,779Loss on
          disposal 
     of capital assets
          3
          -
          -
          -
          7
          10Income tax
          expense
          651
          91
          -
          -
          3
          745Net income
          (loss) from 
     continuing operations
          1,326
          928
          -
          (252)
          (1,719)
          283Segment assets
          9,140
          988
          -
          603
          3,423
          14,154






2001
          Panama
          Gaming
          Guatemala
          Video
          Lottery
          California
          Gaming
          Nicaragua
          Corporate
          And Other
          TotalExternal
          revenue
          $ 13,253
          $ 1,645
          $ 22
          $ 1,368
          $ 132
          $ 16,420Amortization
          884
          190
          -
          87
          135
          1,296Gain (loss) on
          disposal 
     of capital assets
          8
          -
          -
          -
          (68)
          (60)Income tax
          expense
          727
          58
          -
          -
          6
          791Net income
          (loss) from 
     continuing operations
          1,268
          930
          516
          (911)
          (3,696)
          (1,893)Segment assets
          7,199
          1,790
          -
          701
          3,724
          13,414








---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          21. SEGMENTED INFORMATION (cont'd.)






2000
          Panama
          Gaming
          Guatemala
          Video
          Lottery
          California
          Gaming
          Nicaragua
          Corporate
          And Other
          TotalExternal revenue
          $    
          14,379
          $     
          1,449
          $       
          344
          $           
          -
          $          
          22
          $    
          16,194Amortization
          824
          159
          6
          -
          156
          1,145Gain (loss) on disposal
          
    of capital assets
          18
          (6)
          -
          -
          (3)
          9Income tax expense
          1,144
          329
          -
          -
          68
          1,541Net income (loss) from 
     continuing operations
          1,897
          833
          338
          -
          (3,697)
          (629)Segment assets
          8,207
          1,877
          626
          -
          1,557
          12,267Geographic information as at December 31, 2002:










Panama
          Guatemala
          Nicaragua
          United
          States
          Other
          TotalRevenue
          $    
          14,717
          $     
          1,762
          $     
          2,028
          $         
          12
          $          
          -
          $    
          18,519Capital assets
          5,671
          121
          384
          180
          -
          6,356Geographic information as at December 31, 2001:






Panama
          Guatemala
          Nicaragua
          United
          States
          Other
          TotalRevenue
          $    
          13,253
          $     
          1,645
          $     
          1,368
          $          
          22
          $       
          132
          $    
          16,420Capital assets
          3,794
          380
          496
          333
          -
          5,003








Geographic information as at December 31, 2000:





Panama
          Guatemala
          Nicaragua
          United
          States
          Other
          TotalRevenue
          $    
          14,379
          $     
          1,449
          $          
          -
          $       
          344
          $        
          22
          $    
          16,194Capital assets
          3,332
          711
          -
          161
          22
          4,226








---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          22.                    
          SUBSEQUENT EVENTS
          The following events occurred subsequent to
              December 31, 2002:a)
          In March, 2003, the
          Company entered into an agreement to merge the Company's gaming
          operations in Nicaragua with the gaming operations of Hopewell
          Limited, S.A.. The Company will own a 20.54% equity interest in the
          merged entity.b)
          Effective January 1, 2003,
          the Company negotiated a consolidated term loan in the amount of
          $2,975,000 bearing interest at 14% per annum (20% upon the occurrence
          of an event of default) due in monthly instalments of $81,300 and
          secured by the shares of Thunderbird Panama. This loan was obtained in
          exchange for the Company's 14% term loans outstanding as at December
          31, 2002 in the amount of $2,145,000, a Loan Participation Agreement
          representing an additional 6% equity interest in the gaming operation
          in Venezuela in the amount of $530,000 and additional transaction
          costs of $300,000.In connection with the
          consolidated term loan, the Company also granted the lender warrants
          to acquire up to 2,345,000 common shares of the Company at a price of
          the lesser of CDN$0.15 or US$0.10. The exercise price shall first be
          paid by reduction of the principal and interest on the consolidated
          term loan. The warrants commence expiring February, 2005 and continue
          each month thereafter in an amount equal to 97,708 warrants per month
          until fully expired.c)
          In January 2003, the
          Company was notified of a legal claim seeking damages of $350,000 with
          respect to the Mexico operations. However, in the opinion of
          management, this claim is without merit and the Company intends to
          vigorously defend itself against the lawsuit.23.                    
          UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES
          These financial statements have been prepared
              in accordance with Canadian generally accepted accounting
              principles ("Canadian GAAP") which differ in some respects from
              those generally accepted accounting principles in the United
              States ("U.S. GAAP") and from practices prescribed by the
              Securities and Exchange Commission ("SEC"). The significant
              differences and their effect on these consolidated financial
              statements are as follows:a)
          Accounting for stock-based
          compensation
          Under U.S. GAAP, Statements of Financial Accounting Standards No. 123,
          "Accounting for Stock-based Compensation" ("SFAS 123") requires
          companies to establish a fair market value based method of accounting
          for stock-based compensation plans. The Company has chosen to account
          for stock-based compensation using Accounting Principles Board Opinion
          No. 25 "Accounting for Stock Issued to Employees" ("APB 25").
          Accordingly, compensation cost for stock options is measured as the
          excess, if any, of the quoted market price of the Company's stock at
          the date of grant over the option price. As the exercise prices of
          options granted by the Company approximate market values at the date
          of the grant, the Company has determined that the application of the
          intrinsic value method for stock based compensation to employees has
          no material effect on its reported results of operations.












---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          23. UNITED STATES GENERALLY ACCEPTED ACCOUNTING
          PRINCIPLES (cont'd.)a)
          Accounting for stock-based compensation (cont'd.)
          
          Stock options granted to non-employees for services
          rendered to the Company are required to be accounted for as
          stock-based compensation and charged to operations based on the fair
          value of the services provided or the consideration issued as the
          services are provided and the options earned. Under U.S. GAAP, the
          Company recorded additional compensation expense during the current
          year of $Nil (2001 - $102,000; 2000 - $129,000) based on the fair
          value of options granted to non-employees.
          In addition, for any options granted subsequent to
          January 18, 2001 where the exercise price of the options is
          denominated in a currency other than the functional currency of either
          the employer or the employee, U.S. GAAP requires variable accounting.
          As the Company's and the Company's employees' functional currency is
          the U.S. dollar but the exercise price of the stock options granted by
          the Company is denominated in Canadian dollars, options granted
          subsequent to January 18, 2001 by the Company require variable
          accounting whereby compensation expense for the period is recognized
          for the difference between the intrinsic value of the options at the
          end of the period and the intrinsic value of the options when granted,
          less any compensation expense recognized in prior periods. The use of
          variable accounting for these awards does not result in any
          compensation expense for the year ended December 31, 2002 as the
          market price at December 31, 2002 is less than the exercise prices.
          Under Canadian GAAP, the reporting of stock-based
          compensation expense in the Company's financial statements was not
          required for the years ended December 31, 2001 and 2000. New
          accounting and disclosure standards were introduced under Canadian
          GAAP (Note 12) for fiscal years ending December 31, 2002. Accordingly,
          there is no difference between Canadian GAAP and U.S. GAAP on the
          accounting for stock-based compensation for the year ended December
          31, 2002.b)
          Investment in joint
          ventures
          Investment in joint ventures are accounted for under the proportionate
          consolidation method for purposes of Canadian GAAP. Under U.S. GAAP,
          investments in joint ventures are accounted for under the equity
          method. However, rules prescribed by the SEC permit the use of the
          proportionate consolidation method in the reconciliation to U.S. GAAP
          provided the joint venture is an operating entity and the significant
          financial operating policies of which are, by contractual arrangement,
          jointly controlled by all parties having an equity interest in the
          joint venture entity. The SEC's policy requires specified disclosures
          which have been made in Note 19. Accordingly, for purposes of
          reconciliation to U.S. GAAP, the Company has used the proportionate
          consolidation method and no GAAP difference arises.










---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          23.                        
          UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (cont'd.)c)
          Imputation of interest
          
          U.S. GAAP requires that where property, goods or
          services is exchanged for a note receivable that does not bear
          interest at market rates, the transaction should be recorded at the
          discounted present value. Any premium or discount recorded on the note
          should then be accounted for an as element of interest over the life
          of the note. There is no similar requirement under Canadian GAAP.
          Accordingly, at December 31, 2002 the Company's note receivable from
          Apuestas Continentales, S.A. recorded at $408,000 (2001 - $408,000)
          for Canadian GAAP, would be reduced to approximately $374,000 (2001 -
          $374,000) under U.S. GAAP. In addition, interest income would increase
          by $Nil (2001 - $66,000; 2000 - decrease by $100,000) under U.S. GAAP,
          resulting in no change in the reported loss for the year (2001 -
          $66,000 decrease in the reported loss for the year; 2000 - $100,000
          increase in the reported loss for the year).d)
          Investments in and
          advances to equity investeesUnder both Canadian
          GAAP and U.S. GAAP, when accounting for investments in companies using
          the equity method, an investor is required to recognize its pro rata
          share of any post-acquisition losses of an investee by way of a
          reduction in the carrying amount of its investment, including
          advances, in the investee. However, where an investor owns common
          stock and other investments in or has advances to the investee, is not
          required to advance additional funds to the investee and where losses
          have reduced the common stock investment to zero, while Canadian GAAP
          does not prescribe a method for determining an investor's "pro rata
          share" of any post-acquisition losses of an investee, U.S. GAAP
          prohibits the recognition of equity method losses by an investor based
          solely on the percentage of investee common stock held by an investor.
          
          During the year ended December 31, 2002, for
          Canadian GAAP purposes the Company recorded aggregate equity losses in
          equity investees of $578,000 (2001 - $1,366,000; 2000 - $972,000)
          which was calculated based on the percentage of common stock of the
          equity investees held by the Company. Under U.S. GAAP, the aggregate
          equity losses in equity investees would decrease to $424,000 (2001 -
          decreased to $1,365,000; 2000 - increased to $1,127,000), resulting in
          a reduction in the carrying value of the Company's Mexican and
          Venezuelan investments by $Nil (2001 - $Nil; 2000 - $27,000) and $Nil
          (2001 - $154,000; 2000 - $128,000), respectively.e)
          Gain on disposal of discontinued operations
          
          For Canadian GAAP purposes, the Company recorded a
          gain on disposal of the Calsino, Inc. operations during the year ended
          December 31, 2000 as described in Note 20. For U.S. GAAP purposes the
          gain would be deferred until the note receivable is paid. As described
          in Note 4(g), the note receivable was written down to $Nil during
          fiscal 2001, reflecting management's uncertainty of its ability to
          collect under the terms of the note receivable.f)
          Share purchase loans
          
          Under Canadian GAAP, the Company includes share
          purchase loans totaling $36,000 (2001 - $45,000) due from certain
          management and officers of the Company in amounts receivable. Under
          U.S. GAAP, these loans are recorded as a deduction to shareholders'
          equity.






---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          23.                 
          UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (cont'd.)g)
          Term loans
          Under Canadian GAAP, the term loans (Note 9(b)) are classified between
          current and long-term liabilities based on their scheduled repayment
          dates. These loans become repayable on demand upon the occurrence of
          specified events of default, one of which, is the occurrence of a
          material adverse change (as defined in the loan agreements). Under
          U.S. GAAP, as a result of such a subjective acceleration charge,
          $1,885,000 (2001 - $2,145,000) classified as long-term debt under
          Canadian GAAP would be classified as a current liability.h)
          New accounting standards
          In June 2001, the Financial Accounting Standards Board ("FASB")
          approved the issuance of Statements of Financial Accounting Standards
          No. 142, "Goodwill and Other Intangible Assets" ("SFAS 142"). SFAS 142
          requires that goodwill no longer be amortized to earnings, but instead
          be reviewed for impairment. The statement is effective for fiscal
          years beginning after December 15, 2001, and is required to be applied
          at the beginning of an entity's fiscal year and to be applied to all
          goodwill and other intangible assets recognized in its financial
          statements at that date. Impairment losses for goodwill and
          indefinite-lived intangible assets that arise due to the initial
          application of this statement (resulting from a transitional
          impairment test) are to be reported as resulting from a change in
          accounting principle. Under an exception to the date at which this
          statement becomes effective, goodwill and intangible assets acquired
          after June 30, 2001, will be subject immediately to the
          non-amortization and amortization provisions of this statement.
          In June 2001, FASB issued Statements of Financial Accounting Standards
          No. 143, "Accounting for Asset Retirement Obligations" ("SFAS 143")
          that records the fair value of the liability for closure and removal
          costs associated with the legal obligations upon retirement or removal
          of any tangible long-lived assets. The initial recognition of the
          liability will be capitalized as part of the asset cost and
          depreciated over its estimated useful life. SFAS 143 is required to be
          adopted effective January 1, 2003.
          In August 2001, FASB issued Statements of Financial Accounting
          Standards No. 144, "Accounting for the Impairment on Disposal of
          Long-lived Assets" ("SFAS 144"), which supersedes Statements of
          Financial Accounting Standards No. 121, "Accounting for the Impairment
          of Long-lived Assets and for Long-lived Assets to be Disposed of".
          SFAS 144 requires that long-lived assets that are to be disposed of by
          sale be measured at the lower of book value or fair value less cost to
          sell. Additionally, SFAS 144 expands the scope of discontinued
          operations to include all components of an entity with operations that
          (1) can be distinguished from the rest of the entity and (2) will be
          eliminated from the ongoing operations of the entity in a disposal
          transaction. SFAS 144 is effective for fiscal years beginning after
          December 15, 2001, and, generally, its provisions are to be applied
          prospectively.
          In April 2002, FASB issued Statements of Financial Accounting
          Standards No. 145, "Rescission of FASB Statements No. 4, 44 and 64,
          Amendment of FASB Statement No. 13, and Technical Corrections" ("SFAS
          145"). SFAS 145 eliminates the requirement that gains and losses from
          the extinguishment of debt be aggregated and, if material, classified
          as an extraordinary item, net of the related income tax effect and
          eliminates an inconsistency between the accounting for sale-leaseback
          transactions and certain lease modifications that have economic
          effects that are similar to sale-leaseback transactions. Generally,
          SFAS 145 is effective for transactions occurring after May 15, 2002.








---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          23.                 
          UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (cont'd.)h)
          New accounting standards (cont'd.)
          
          In June 2002, FASB issued Statements of Financial
          Accounting Standards No. 146, "Accounting for Costs Associated with
          Exit or Disposal Activities" ("SFAS 146") that nullifies Emerging
          Issues Task Force No. 94-3, "Liability Recognition for Certain
          Employee Termination Benefits and Other Costs to Exit an Activity
          (Including Certain Costs Incurred in a Restructuring)" ("EITF 94-3").
          SFAS 146 requires that a liability for a cost associated with an exit
          or disposal activity be recognized when the liability is incurred,
          whereby EITF 94-3 had recognized the liability at the commitment date
          to an exit plan. The provisions of this statement are effective for
          exit or disposal activities that are initiated after December 31, 2002
          with earlier application encouraged.
          
          In October 2002, FASB issued Statements of
          Financial Accounting Standards No. 147, "Accounting of Certain
          Financial Institutions - an amendment of FASB Statements No. 72 and 44
          and FASB Interpretation No. 9" ("SFAS 147"). SFAS 147 requires the
          application of the purchase method of accounting to all acquisitions
          of financial institutions, except transactions between two or more
          mutual enterprises. SFAS 147 is effective for acquisitions for which
          the date of acquisition is on or after October 1, 2002.
          
          In December 2002, FASB issued Statements of
          Financial Accounting Standards No. 148, "Accounting for Stock-Based
          Compensation - Transition and Disclosure - an amendment of FASB
          Statement No. 123" ("SFAS 148"). SFAS 148 amends FASB Statement No.
          123 to provide alternative methods of transition for a voluntary
          change to the fair value based method of accounting for stock-based
          employee compensation. In addition, SFAS 148 amends the disclosure
          requirements of FASB Statement No. 123 to require prominent
          disclosures in both annual and interim financial statements about the
          method of accounting for stock-based employee compensation and the
          effect of the method used on reported results. SFAS 148 is effective
          for fiscal years ending after December 15, 2002.
          
          In April 2003, FASB issued Statements of Financial
          Accounting Standards No. 149 "Amendment of Statement 133 on Derivative
          Instruments and Hedging Activities" ("SFAS 149"). SFAS 149 amends and
          clarifies financial accounting and reporting for derivative
          instruments, including certain derivative instruments embedded in
          other contracts and for hedging activities under FASB Statement No.
          133 "Accounting for Derivative Instruments and Hedging Activities".
          SFAS 149 is generally effective for contracts entered into or modified
          after June 30, 2003.
          
          In May 2003, FASB issued Statements of Financial
          Accounting Standards No. 150 "Accounting for Certain Financial
          Instruments with Characteristics of both Liabilities and Equity"
          ("SFAS 150"). SFAS 150 establishes standards for how an issuer
          classifies and measures certain financial instruments with
          characteristics of both liabilities and equity. SFAS 150 is effective
          for financial instruments entered into or modified after May 31, 2003.
          
          The adoption of these new pronouncements is not
          expected to have a material effect on the Company's consolidated
          financial position or results of operations.








---

INTERNATIONAL THUNDERBIRD GAMING CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          (Expressed in United States dollars)
          (Tabular amounts expressed in thousands of dollars except per share
          amounts)
          DECEMBER 31, 2002
          
          
          
          
          23.                    
          UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (cont'd)
          The effects of the above differences between
              Canadian GAAP and U.S. GAAP on the consolidated balance sheets and
              statements of operations are as follows:






2002
          2001Share capital under Canadian GAAP
          $ 21,085
          $ 21,089Adjustment for stock-based compensation to
          non-employees (a)
          545
          545Share capital under U.S. GAAP
          $ 21,630
          $ 21,634








2002
          2001Deficit under Canadian GAAP
          $ (19,321)
          $ (19,645)Adjustment for stock-based compensation to
          non-employees (a)
          (545)
          (545)Adjustment for imputation of interest cost (c)
          (34)
          (34)Adjustment for accounting losses of equity
          accounted investments (d)
          -
          (154)Deficit under U.S. GAAP
          $ (19,900)
          $ (20,378)








2002
          2001
          2000Income (loss) from continuing operations under
          Canadian GAAP
          $        
          283
          $    (1,893)
          $      (629)Stock-based compensation to non-employees (a)
          -
          (102)
          (129)Imputation of interest cost (c)
          -
          66
          (100)Gain (loss) of equity accounted investments (d)
          154
          1
          (155)Income (loss) from continuing operations under U.S.
          GAAP
          437
          (1,928)
          (1,013)Income (loss) from discontinued operations under
          Canadian GAAP
          41
          (1,187)
          (662)Adjustment to gain on discontinued operations (e)
          -
          266
          (266)Income (loss) from discontinued operations under
          U.S. GAAP
          41
          (921)
          (928)Net income (loss) under U.S. GAAP
          $        
          478
          $   
          (2,849)
          $   
          (1,941)Basic and fully diluted earnings (loss) per share
          under U.S. GAAPContinuing operations
          $       
          0.01
          $     
          (0.08)
          $     
          (0.05)Discontinued operations
          -
          (0.04)
          (0.04)Net earnings (loss)
          $       
          0.01
          $     
          (0.12)
          $     
          (0.09)The impact of
          the above differences between Canadian GAAP and U.S. GAAP do not
          materially affect the consolidated statements of cash flows.






SIGNATURE
          
          The registrant hereby certifies that it meets all of
          the requirements for filing on Form 20-F and that it has duly caused
          and authorized the undersigned to sign this annual report on its
          behalf.Dated: June 30, 2003
          INTERNATIONAL THUNDERBIRD GAMING CORPORATION
          Per:
          
          
          
          
          Albert W. Atallah
          Chief Operating OfficerCERTIFICATE
          I, Jack R. Mitchell, certify that:
          I have reviewed this annual report on Form 20-F of International
            Thunderbird Gaming Corporation;
            Based on my knowledge, this annual 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 annual report;
            Based on my knowledge, the financial statements, and other
            financial information included in this annual report, fairly present
            in all material respects the financial condition, results of
            operations and cash flows of the registrant as of, and for, the
            periods presented in this annual report;
            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 have:designed such disclosure controls and procedures to ensure
              that material information relating to the registrant, including
              its consolidated subsidiaries, is made known to us by others
              within those entities, particularly during the period in which
              this annual report is being prepared;
              evaluated the effectiveness of the registrant's disclosure
              controls and procedures as of a date within 90 days prior to the
              filing date of this annual report (the "Evaluation Date"); and
              presented in this annual report our conclusions about the
              effectiveness of the disclosure controls and procedures based on
              our evaluation as of the Evaluation Date;
          5. The registrant's other certifying 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 function):
          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
              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 annual report whether or not there were significant changes in
          internal controls or in other factors that could significantly affect
          internal controls subsequent to the date of our most recent
          evaluation, including any corrective actions with regard to
          significant deficiencies and material weaknesses.Date: July 10, 2003
          ______________________________________
          Jack R. Mitchell
          President and CEO
          International Thunderbird Gaming CorporationCERTIFICATE
          I, Albert W. Atallah, certify that:
          I have reviewed this annual report on Form 20-F of International
            Thunderbird Gaming Corporation
            Based on my knowledge, this annual 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 annual report;
            Based on my knowledge, the financial statements, and other
            financial information included in this annual report, fairly present
            in all material respects the financial condition, results of
            operations and cash flows of the registrant as of, and for, the
            periods presented in this annual report;
            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 have:designed such disclosure controls and procedures to ensure
              that material information relating to the registrant, including
              its consolidated subsidiaries, is made known to us by others
              within those entities, particularly during the period in which
              this annual report is being prepared;
              evaluated the effectiveness of the registrant's disclosure
              controls and procedures as of a date within 90 days prior to the
              filing date of this annual report (the "Evaluation Date"); and
              presented in this annual report our conclusions about the
              effectiveness of the disclosure controls and procedures based on
              our evaluation as of the Evaluation Date;
          5. The registrant's other certifying 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 function):
          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
              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 annual report whether or not there were significant changes in
          internal controls or in other factors that could significantly affect
          internal controls subsequent to the date of our most recent
          evaluation, including any corrective actions with regard to
          significant deficiencies and material weaknesses.Date: July 10, 2003
          ___________________________________
          Albert W. Atallah
          General Counsel and
          Chief Operating Officer
          International Thunderbird Gaming CorporationCERTIFICATE
          I, Booker T. Copeland III, certify that:
          1.I have reviewed this annual report on Form 20-F of International
          Thunderbird Gaming Corporation
          2. Based on my knowledge, this annual 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 annual report;
          3. Based on my knowledge, the financial statements, and other
          financial information included in this annual report, fairly present
          in all material respects the financial condition, results of
          operations and cash flows of the registrant as of, and for, the
          periods presented in this annual 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 have:
          designed such disclosure controls and procedures to ensure
              that material information relating to the registrant, including
              its consolidated subsidiaries, is made known to us by others
              within those entities, particularly during the period in which
              this annual report is being prepared;
              evaluated the effectiveness of the registrant's disclosure
              controls and procedures as of a date within 90 days prior to the
              filing date of this annual report (the "Evaluation Date"); and
              presented in this annual report our conclusions about the
              effectiveness of the disclosure controls and procedures based on
              our evaluation as of the Evaluation Date;
          5. The registrant's other certifying 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 function):
          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
              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 annual report whether or not there were significant changes in
          internal controls or in other factors that could significantly affect
          internal controls subsequent to the date of our most recent
          evaluation, including any corrective actions with regard to
          significant deficiencies and material weaknesses.Date: July 10, 2003
          _____________________________________
          Booker T. Copeland, III
          Chief Financial Officer
          International Thunderbird Gaming Corporation




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